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Complex Coffee

2 March, 2010 by James Lawther Leave a Comment

I came across this youtube video for Baileys Coffee and I started to wonder, do Baileys actually make any money out of it?

How much does the extra complexity cost them.

First there is the product complexity: extra labels, different flavours, extra SKU’s…
Secondly there is process complexity: change overs, work arounds, reduced forecast accuracy…
Finally there is organisational complexity: extra brand managers, coffee buyers, business groups…

And all of those issues interact, the new brand manager won’t forecast accurately so they run out of labels.

As they have Original, Crème Caramel, Mint Chocolate and Coffee flavours the cost maths isn’t 4+4+4 = 12; it is 4x4x4 = 64.

Mind you, the bottle I got for Christmas still tastes great.

Photo by Kobby Mendez on Unsplash

Filed Under: Blog, Operations Analysis Tagged With: complexity, manufacturing, marketing, video

About the Author

James Lawther
James Lawther

James Lawther is a middle-aged, middle manager.

To reach this highly elevated position he has worked in numerous industries, from supermarket retailing to tax collecting.  He has had several operational roles, including running the night shift in a frozen pea packing factory and carrying out operational research for a credit card company.

As you can see from his C.V. he has either a wealth of experience or is incapable of holding down a job.  If the latter is true this post isn’t worth a minute of your attention.

Unfortunately, the only way to find out is to read it and decide for yourself.

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