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CASE STUDY
7- ELEVEN JAPAN CO.
PRESENTED BY:
Richa GuptaSana Sayeed
Seema.P
Satish.P
Santosh.S
Ranjith
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INTRODUCTION
The goal of this case is to illustrate how a firm can be
successful by structuring its supply chain to support its
supply chain strategy. Once Seven-Eleven Japan decided
to provide responsiveness by rapid replenishment, itthen structured its facilities, inventory, information, and
distribution to support this choice. The case also brings
up the question of whether the same approach can
work in the United States.
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QUESTION.1
As responses - uncertainty
(Convenience Store)
Local Capacity
Local Inventory
Rapid Replenishment
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QUESTION 2
Risk associated with attempting to micro match
supply and demand are:
High cost of Transportation
High order cost
As they have reduced vehicles they dont have any
back up plan
IT Breakdown
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QUESTION 3
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FACILITIES
INVENTORY
Less in no.
Held no
inventory
Decreased
efficiency
DC
More in no.
Kept
inventory
on shelf
Located in
abundanceand
dominated
market
More
responsive
Stores
No inventory
Highlyefficient
Poor at
responsivene
ss
DC
Kept dailystock
Low
inventory
More
efficient
VeryResponsive
Stores
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CONTI..
TRANSPORTATION
At two levels:
-Vendors To DC and
-DC to Store
Mode:
Trucks
-High Frequency
-High Responsiveness.
INFORMATION
Graphic Order Terminal
Scanner Terminal
Store computer
POS Register
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QUESTION 4
BENEFITS OF DISTRIBUTION CENTRES:
Reduces complexity at store level
Organizes store demand at DC
Reduces complexity and cost for vendors to directly
delivery at the store
DSD MORE APPROPRIATE:
Variety of product is less
Order size is more
Delivery destinations are few.
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QUESTION 5
The 7dream concept allows e-commerce sites to
use Seven-Eleven stores as drop-off and collection
points for Japanese e-commerce customers. It hasbeen extremely successful; a recent survey
revealed that 92 percent of the customers of one
e-commerce company preferred to have their
items shipped this way.
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CONTI
This concept will be more successful in Japan as
compared to US because :
Store density is high in Japan
As store density is high, Seven-Eleven to offer alower cost alternative to having a package carrierdeliver the product at home
Suburban customers in the US would likely find itincredibly inconvenient and avoid it unless homedelivery was not possible .
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QUESTION 6
Pros
Ensures fresh supply of items
Operational efficiency
It will reduce vehicles for distribution
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CONT
Cons: The difficulty of duplicating the Japan supply
chain structure in the United States follows
primarily from the much lower density of U.S.Seven-Eleven stores.
Wholesalers may have issues because of the
distribution centers
Manufacturers may prefer DSD as they have morecontrol here
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QUESTION 7
Pros
Cost effective
CDC (Combined distribution centre) makes seven
eleven networking strong. Given the lower density of stores, a distributor is
able to aggregate deliveries across many
competing stores.
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CONT
Cons
Less control over replenishment cycles and
over quality of items
May not be responsive as having own
distribution system
DCs should maintain inventory
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CONCLUSION
Supply chain system adopted by 7-Eleven in
Japan is very effective. Here they managed
Efficiency & Responsiveness and by thisachieved strategic fit.
Thus we realize that by integrating the supply
chain certain constraints of business can be
minimized and customer service levels can
be improved through executing information
technology systems.
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