Supply Chain

Of Cadbury

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 TABLE OF CONTENTS

SR. NO. CONTENTS PAGE NO.

1 INTRODUCTION TO CADBURY 3

2 ELEMENTS OF SUPPLY CHAIN 5

3 SUPPLY CHAIN MANAGEMENT 6

4 SWOT ANALYSIS OF CADBURY 7

5 SUPPLY CHAIN OF CADBURY 10

6 CONCLUSION 12

7 BIBLIOGRAPHY 13

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INTRODUCTION TO CADBURY
Cadbury, formerly Cadbury's and Cadbury Schweppes, has been owned by
Mondelez International (originally Kraft Foods) as a British multinational
confectionery corporation since 2010. This is the world's second-largest
confectionery company after Mars. Cadbury is based globally in Uxbridge,
West London, and operates worldwide in more than 60 countries.
Cadbury was founded in 1824 by John Cadbury in Birmingham, England who
sold tea, coffee, and chocolate. Cadbury and his brother Benjamin founded the
business and his sons Richard and George followed. George built the Bournville
estate, a model village designed to enhance living standards for the company's
employees
In 1854 Cadbury received his first Royal Warrant from Queen Victoria. Since
1955 it has held a Royal Warrant from Elizabeth II. Cadbury merged with J. S.
Fry & Sons (1919) and Schweppes (1969), until 2008 known as Cadbury
Schweppes, when the American beverage business was divided as Dr. Pepper
Snapple Group; since 2006, the rights ownership of the Schweppes brand had
already varied between different countries. Cadbury was a permanent
constituent of the FTSE 100 on the London Stock Exchange from the start of
the index in 1984 until Kraft Foods acquired the company in 2010.
Cadbury India
By importing chocolates, Cadbury India started its operations in India in 1948.
Cadbury was born in India on 19 July 1948. It now has factories in Thane,
Induri (Pune), Malanpur (Gwalior), Hyderabad, Bangalore and Baddi
(Himachal Pradesh), and distribution offices in New Delhi, Mumbai, Kolkata
and Chennai.
The head office of company is in Mumbai. The headquarters is actually located
at Pedder Street, Mumbai under the name "Cadbury House." After its formation
this colossal structure at Pedder Road has been a landmark for Mumbai
residents.
Cadbury has pioneered cocoa production in India after 1965. Cadbury has been
collaborating with Kerala Agricultural University for over two decades to
conduct research into cocoa.
Cadbury India currently operates in five categories-Chocolate, Beverages,
Biscuits, Gum and Candy. Its products include: Cadbury Dairy Milk, Dairy
Milk Silk, Bournville, 5-Star, Temptations, Perk, Eclairs, Bournvita,

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Celebrations, Gems, Bubbaloo, Cadbury Dairy Milk Shots, Toblerone, Halls,
Bilkul, Tang and Oreo.
It is the market leader in the chocolate confectionery sector with a market share
of over 70 percent. On 21 April 2014, Cadbury India changed its name to
Mondelez India Foods Limited. In 2017, Cadbury / Mondelez agreed to pay an
FCPA fine of $13 million for making illegal payments to government officials
to procure licenses and permits to develop a factory in Baddi.

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Elements of the Supply Chain
A simple supply chain consists of many elements connected together by the
movement of goods through it. The supply chain starts with the customer and
finishes with them.
Customer: Once the consumer wants to purchase a product which has been
provided for sale by a business, the chain of events begins. The customer must
contact the company's sales department, who will register the purchase order for
a specific amount to be shipped on a particular date. If the product has to be
manufactured, the sales order will include a requirement that needs to be
fulfilled by the production facility.

Planning: The requirement is combined with other orders triggered by the

customer's sales order. The planning department will create a production plan to
produce the products to meet the orders of the customer. The company will then
have to buy the needed raw materials to manufacture the products.

Purchasing: The purchasing department provides a list of the raw materials and
services needed to fulfil the customer's orders from the production department.
The purchasing department sends purchase orders to selected suppliers on the
correct date to supply the requisite raw materials to the fabrication site.

Inventory: The manufacturers obtain the raw materials, test for consistency and
accuracy and transfer them into the warehouse. The retailer would then give the
client an invoice for the products it supplied. The raw materials are processed
until the production department needs them.

Production: The raw materials are moved inventory to the manufacturing area
based on a production plan. The finished goods ordered by the customer are
manufactured using the suppliers 'raw materials purchased. Upon completion
and testing of the goods, they are placed back in the warehouse until distribution
to the customer.

Transportation: When the finished product arrives in the warehouse, the

shipping department determines the most efficient method to ship the products
so that they are delivered on or before the date specified by the customer. When

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the goods are received by the customer, the company will send an invoice for
the delivered products.

Supply Chain Management

Organizations have implemented supply chain management systems and

associated technologies to ensure that the supply chain works as effectively as
possible and achieves the highest level of customer satisfaction at the lowest
expense. Supply Chain Management has three types of operations that will
concentrate on the different sections of the company: strategic; tactical; and
operational.

Strategic: At this stage, company management will look at high-level strategic

decisions about the whole organization, such as the size and location of
manufacturing sites, supplier relationships, manufacturing goods and consumer
markets.

Tactical: Tactical decisions concentrate on taking cost-benefit steps such as

using industry best practices, developing a buying plan with preferred suppliers,
collaborating with logistics firms to improve cost-effective transport and
designing warehouse strategies to minimize inventory storage costs.

Operational: Decisions at this level are made on a daily basis in companies

which affect how the products move along the supply chain. Operational
decisions involve making changes to the production schedule, purchasing
agreements with suppliers, taking orders from customers and moving products
in warehouse.

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 SWOT analysis of Cadbury
Cadbury is one of India's top fmcg brands, and therefore there is no doubt that
Cadbury's strengths and opportunities are far more than its weaknesses and
threats. Let's dive deeper into the SWOT of Cadbury.

 Strengths

 World leader – Cadbury is the world leader in chocolates. Known to have the
best manufacturing and distribution channels, Cadbury has a presence in 160 or
more countries.

 Powerhouse brands and products – Cadbury has many strong brands in its
product portfolio, such as milk, Bournvita, Oreo, five stars and others. Products
are high quality products, and some of them are cash cows for Cadbury.

 Brand Name, Brand Equity and Brand Loyalty – Cadbury products are
blessed with great brand loyalty. Due to its marketing and strong branding over
the years, Cadbury's brand equity is also high and, as a result, Cadbury is
comfortable charging a premium for its product because of its high brand
equity. Finally, some of the brand names in the Cadbury family are known all
over the world and are desired by man.

 Positioning as a gift – Cadbury's smartest strategy over the years with products
such as milk and celebrations is to position these chocolates for gifts. The recent
bournville, in fact, has a complete focus on the gifting position. Thanks to this
smart strategy, Cadbury has distinguished itself from most of its competitors.

 Promotions-Cadbury has one of the strongest promotions in the fmcg industry

with an amazing tag line of "kuch meetha ho jaye”. This further gives Cadbury
strength because it provides excellent brand recall.

 Indian Connect – Cadbury is one of the few brands that connects so well with
the Indian diaspora. For Indians, family, friends and love are all important parts
of their lives. And Cadbury's focus has always been on emotional marketing to
connect with Indian audiences.

 Placement and Distribution – Cadbury has a superb distribution strategy in

place and, like all FMCG companies, uses a strategy to break down the bulk.

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 The distribution of more than 40 variants to 200 countries is not a small feat.
And Cadbury has been doing the same for many years. It is known to have one
of India's best FMCG distribution channels.

 Weaknesses in the SWOT analysis of Cadbury

 As mentioned earlier, a brand like Cadbury is expected to have many strengths
and few weaknesses, and the same is true. Cadbury's weakness is its rural
distribution, given that India has a large rural diaspora that can be covered.

 At the same time, a few cases have occurred here and there on the basis of the
quality of the product in which cockroaches or other rodents have been found in
chocolate. It is inexcusable for a brand like Cadbury to show such ignorance,
because such infected chocolates should never leave quality control. Quality
control must therefore be strengthened.

 Opportunities in the SWOT analysis of Cadbury

 Rural markets – What is weak can become an opportunity. The penetration of
rural markets and distribution in rural markets can be a great opportunity for
Cadbury. It is present in foreign countries and Cadbury needs a rural presence
that will boost brand presence and turnover.

 New Tastes – Indian consumers have a sweet tooth and often like to eat small
chocolates as well as chocolate bars. There are also different flavors that
consumers like. New tastes and new flavours, therefore, are an opportunity that
Cadbury can provide on a regular basis.

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 Threats in the SWOT analysis of Cadbury
 Cost and price increase – As the cost of fuel and transport increases, the cost
of distribution has increased. At the same time, the costs of procurement and
manufacturing are also high. Thus, over the years, the constant increase in
costing and thus pricing of the product is a threat to Cadbury as it creates a gap
for other companies to enter.
 Health awareness on the rise – Health awareness is on the rise among the
Indian population. Many people prefer to drink healthy juices as well as fruit
rather than chocolates. Every week, you'll see news articles as well as blogs that
advise against eating chocolate and spread the benefits of staying healthy. At
the same time, many parents have stopped giving chocolates to their kids
looking at the adverse effects.

 Rising demand from people, increasing buying power – Nowadays, if you

donate chocolate to children, they are likely to demand a toy car, a bicycle or a
computer for a young adult. As a result, with the rise in buying power, the
market for gifts has also risen in value, and chocolate alone does not suffice.
This is a threat to Cadbury, too.

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Supply Chain of Cadbury
Manufacturing Process of Cadbury
Supply Chain Management of Cadbury Dairy Soy Cadbury Soy Milk is enjoyed by everyone.
It is one of the most well-known and popular chocolates eaten worldwide. The journey of
Cadbury milk begins with the manufacturing process and finishes with the intake of
chocolate lovers.
The full cycle takes about 3-4 months in continuity, where the manufacturing process takes a
long time. The key players in the supply chain management of Cadbury milk are the
production process, the manufacturing process, the distribution process and the retailing
process. Because chocolate requires milk, cocoa and sugar as its key ingredients, the method
of production of all three is also different. The production process entails a higher risk and
expense, as if it were not up to the standard that no more chocolate manufacturing process
could be carried out. Nonetheless, management has a broad range of options to select the best
supplier of each of the three, i.e. milk, cocoa and sugar.
Cadbury has formed a long-term and close partnership with each of its suppliers. Many
European daily farms provide fresh drinking milk to their customers and to Cadbury, which
uses milk in the manufacturing process. Milk collected from cows and refrigerated for 48
hours. Then the milk is sent to the processing plants that have homogenized and pasteurized it
and refrigerated it again.
Afterwards, the milk is processed and sent to the milk processing department of Cadbury.
Cocoa beans are produced mainly from Ghana, Africa. In addition, cocoa is also produced in
Indonesia, India and the Caribbean, where it is grown and harvested. The cocoa pods are then
separated from the beans, which are then dried and stored in a row.
These stacks are then sent to the European area for processing factories that extract cocoa
butter / cocoa or cocoa powder. Sugar is derived from sugar cane which is grown in most
regions of Europe.
Tickets are obtained from the sugar cane harvested and sent to the processing plants that
supply processed sugar to the Cadbury manufacturing plant. Cocoa / butter / powder, milk
and sugar are taken to Cadbury Manufacturing in Bournville, where Cadbury milk is
processed and made.
Cadbury Factory sugar and cocoa are added to the condensed milk to make the creamy
chocolate drink. This liquid is then evaporated by a pin mill to produce a chocolate crumb. In
addition to chocolate flavourings, peanut butter and peanut liquor are combined. Emulsifiers
are added as thick chocolate is needed for moulded blocks.
However, a thinner consistency of chocolate liquid is needed to cover bars and assortments.
Dark chocolate and milk go through the same stages of processing, including conching and
tempering, in order to achieve the shine and smoothness of Cadbury chocolate.
When conching, the semi-liquid chocolate mixture is beaten and mixed to eliminate volatile
flavours and reduce the viscosity of the particle size. During the case of tempering, the liquid
chocolate is cooled and blended under closely regulated conditions to ensure that chocolate
crystallized fats are in stable shape.
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The chocolate liquid is used for this purpose by advanced machines specially designed for the
tempering process. This tempered chocolate could be used in a variety of ways to produce
products with different brands.
The tempered chocolate liquid is poured into the moulds that are shaken and then cooled.
Such shaped blocks are moved to high-speed wrapping plants. Once these chocolates are
cooled off, they're going to box. All these chocolates are packaged together and prepared for
delivery.

Packing
Value is also added when the chocolate is packaged to help it to stay fresh. For Cadbury this
means that the sales would increase because the packaging helps to sell the product, and also
keep the product in the condition it’s meant to be in (cool,dry,fresh,etc). Packaged goods are
delivered to warehouses from which goods are sold locally and globally in more than 60
countries. The basis of distribution is focused on the development of demand in a specific
country or region. Once the finished product, i.e. Cadbury milk, hits its target, which includes
the United Kingdom and other countries, it is then sold to stores selling its milk. Cadbury
milk is distributed to its final customers by supermarkets, hypermarkets, restaurants, local
small shops, etc.
If the packaging for the chocolate did not keep it in the condition its meant to be in then it
would have a negative impact for Cadbury over all because no one would want to purchase
the chocolate and go elsewhere, as chocolate is not a necessity but a luxury item and it has a
lot of substitutes (Elastic Product).

Distribution
Cadbury’s distribution channels include the manufacturing warehouses where the chocolate
production takes place. The first distribution channel is manufacturer, then wholesaler, then
retailer such as for example; ASDA, Sanisbury’s, Newsagents shops and other convenience
stores. Then it is the consumer which is the end result of the channels of distribution for
Cadbury’s.

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Conclusion
Cadbury has dominated market and it is closely followed by nestle. Cadbury has
everything inclined and synchronized. Their marketing strategy, Supply chain, their
market capital but, thing that sets them apart is their advertising agency. They always
come up with new ideas and innovation. They normally use emotional appeal to induce
their consumer and they have different campaigns for different age groups that keeps
them ahead from their competitors also the value added at each stage of production is
made to be more appealing for the customers to buy as the quality of the product is
improved. Adding value has a positive impact for Cadbury, because it aims to attract
more & more customers to buy the chocolate that is produced.

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Bibliography
http://www.managementparadise.com/forums/elements-logistics/211404-
supply-chain-management-cadbury.html
https://www.bartleby.com/topics/Cadbury-supply-chain
https://studymoose.com/supply-chain-of-cadbury-essay

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