Sustainable Logistics Mini project:

Industrial Engineering – Sustainable Logistics

Option

Title of the Mini project :

S&A Processed Seafood Company

Elaborated by :
 Aymane Benkhadra
 Adel Faiz
 Oumayma Ghalem
 Lina Ouidder
 Sidi Ould lamana
 Zineb Zakkour
Supervised by :
 Mrs. Ouhader Hanan

Année universitaire : 2022/2023

 Summary :

I. General Introduction....................................................................3

II. Industry Assessment.....................................................................4

III. Competitive Position within the Supply Chain...........................10

IV. Network Design and Geographic Considerations................... 11

V. Inventory and Flow Planning..................................................12

VI. Customer Service Level Tradeoffs...........................................13

VII. Technology Considerations.......................................................16

VIII. Conclusion..................................................................................17
List of Figures :

Figure 1 SWOT Method........................................................................................................................6

Figure 2 Porter’s five forces Method....................................................................................................6
 General Introduction:

S&A Seafood Company is a leading supplier of fresh and frozen seafood products in the global market. With
over 20 years of experience in the industry, the company has established itself as a trusted and reliable source
for high-quality seafood products. The company operates from its state-of-the-art facilities, where it sources,
processes, and delivers seafood products from some of the world’s richest fishing grounds. With a strong
focus on sustainability and ethical practices, it’s dedicated to providing customers with the best seafood
products, while also preserving the health of the oceans. Whether it's shrimp, salmon, lobster, or any other
seafood product, it has the expertise and resources to provide customers with the freshest and most delicious
seafood products available.

It has grown through acquisition to expand their product line. That broader offering of products has
improved sales in their current focus area of Western Europe. Sales have improved with the new product
acquisitions, but S&A now wishes to expand the entire product line into more of Eastern Europe. However,
the company realizes that their current model of putting a distribution center (DC) in each country that they
service may no longer be the best option as they look to expand. Their increased sales and plans for
aggressive growth will now require greater concentration on the design and operation of their supply chain.

S&A currently has five product lines that they sell to retailers in seven countries. Processed Mussel
customers have traditionally allowed delivery to take up to a week. The company now has one DC in each of
its seven markets and supplies each market from the DC in that country; for example, orders from customers
in Hungary are handled by the DC in Hungary. S&A sources all products from suppliers in Thailand.

Because the company’s headquarters is in London, all products are currently shipped from Thailand to the
DC in UK and then are distributed to the other DCs. Each of the S&A DCs have the ability to ship in bulk
(from DC to DC) and parcel (from DC to customers), plus ship domestically and internationally. S&A’s Thai
suppliers sell products at FOB, and the processed seafood is shipped in bulk via sea freight from Thailand to
the UK. The product is then shipped via trucks in mainland Europe.

We’ll treat these different parts including:

 Industry Assessment.
 Competitive Position within the Supply Chain.
 Network Design and Geographic Considerations.
 Inventory and Flow Planning.
 Customer Service Level Tradeoffs.
  Technology Considerations.

Industry Assessment:

Thorough industry analysis will help to understand such unique aspects of any industry and to look
at how a company compares to others that are in the same niche. Besides, it’s a tool that allows you
to understand your position among your competitors. When you conduct an industry analysis, you
can better plan effective strategies for your business.

The purpose of industrial analysis is to mobilize the analytical skills that each process needs for the
purpose of optimal control of it. It constitutes a real industrial added value allowing to increase the
productivity, to detect and measure the presence of the components but also to control the releases
in the environment. The development of a center of excellence in this field is necessary for the
management and optimization of the factories of the future.
There are many ways in which you can do this. However, we have zeroed down on two of the best
methods to help you analyse an industry:

SWOT Analysis Porter’s Five Forces

Figure 2 SWOT Method Figure 1 Porter’s five forces

Method
First, a SWOT analysis starts with your company's Strengths. Evaluate your strengths from an
internal view including:

 High-quality products: If S&A Seafood is known for offering fresh, high-quality seafood
products, this could be a major asset for the company. Its main objectif is that the costumer
receives the fish in a good condition and if that’s becomes spoiled is obviously unusable

 Mighty brand reputation: S&A Seafood has a significant organic revenue growth in the
European market growing to $550M over these last 3 years and they currently shipped all
their products from Thailand to the DC in UK and then are distributed to the other DCs
this shows that they built a solid reputation for quality and reliability, this
could be a key asset that sets it apart from its competition.

 Strong partnerships and a network of suppliers: It has established strong

relationships with suppliers and distributors, this could be a major asset that allows it to access
high quality products and bring them to market quickly.

 Global Market Expansion: With increasing globalization of trade, there may be opportunities
for a seafood company to expand into new international markets. This can help the company
reach new customers and increase its overall sales.

Second, it followed by your company's Weaknesses:

 Dependence on natural resources: Businesses that depend on seafood are vulnerable to

ecosystem changes, such as overfishing, pollution, and unpredictable weather.

 Lack of differentiation: Companies in the seafood industry may find it difficult to

differentiate themselves from their competitors, making it difficult to differentiate in a
crowded market.

 Supply chain challenges: Seafood companies may face challenges in managing their supply
chains, including maintaining a stable and reliable source of high-quality seafood products.

 Price volatility: Seafood prices can fluctuate significantly due to variations in supply and
demand, making it difficult for businesses to plan their activities and remain competitive.
 Here are some potential Opportunities that a seafood company might consider:

 Growing demand for seafood: The demand for seafood has been increasing globally due to
its health benefits and as a source of protein. A company specializing in seafood products can
capitalize on this trend by expanding its product offerings and increasing its production
capacity.

 Niche markets: The seafood industry is diverse and there may be opportunities to specialize
in niche markets such as organic or sustainably sourced seafood. By targeting these niche
markets, a company can differentiate itself from its competitors and potentially charge a
higher price for its products.

 Diversification of product offerings: In addition to traditional seafood, a company could

consider offering value-added products such as prepackaged meals or ready-to-cook seafood.
This can help the company reach new customer segments and increase sales.

 Experienced Management and Staff: While S&A Seafood has a team of experienced
professionals with in-depth industry knowledge and expertise, This could be a major asset that
helps the company meet challenges and take advantage of opportunities.

It is important to note that these are just a few of the many potential opportunities for a
seafood company. The company should conduct extensive market research and carefully
assess its internal resources and capabilities before pursuing any of these opportunities.

Finally, it ends with your company's Threats:

 Competition: Intense competition from other seafood companies, large and small, can pose a
threat to S&A Seafood Company’s market share and profitability.

 Economic slowdown: The seafood industry is sensitive to economic fluctuations, and a

slowdown in the economy could negatively impact S&A Seafood Company’s sales and
profitability.
 Food security concerns: the seafood industry is highly regulated and any food security
incidents, such as contamination or an outbreak, could damage the reputation of S&A Seafood
Company and negatively impact sales.

 Supply chain disruptions: disruptions to the seafood supply chain, such as overfishing,
changes in fishing regulations or transportation, storage or distribution issues, could
negatively impact the operations and profitability of S&A Seafood Company.

In other way, there’s a second method is Porter’s five forces:

 Threat of new entrants:

 Strict regulations: Related to quality, food safety and the environment can be a challenge
for new market entrants.

 High barriers to entry: High barriers to entry, such as the high costs of starting a seafood
business, could discourage new entrants into the market.

 Limited Access to the Supply Chain: Limited access to quality product suppliers can be a
barrier for new entrants to the market.

 Threat of substitute products:

 Competing Products: Other companies in the same industry can offer similar products that
can replace S&A Seafood Company offerings. This competition can reduce demand for the
company’s products and lead to lower sales and market share.

 Alternative sources of protein: Consumers can focus their food preferences on alternative
sources of protein, such as plant-based products or other meats, which can replace seafood.

 Rising prices: If the cost of seafood increases significantly, consumers can choose cheaper
alternatives, such as other protein sources or vegetarian options, to meet their nutritional
needs.
  Competitive rivalry within an industry:
Competitive rivalry is a key aspect of the business environment for companies operating in the
seafood industry, including the seafood company S&A. Rivalry refers to competitive actions
and decisions taken by companies in the same market, which affect each other directly or
indirectly.

In the seafood industry, competition can come from a variety of sources, including large
multinational corporations, regional players and local businesses. Some of the factors that
drive competition in this industry include product quality, pricing, distribution channels,
marketing and innovation.

It is important for the S&A seafood company to keep a close eye on the competitive
environment and constantly adapt its strategies to stay ahead of its rivals. This may involve
investing in research and development to improve product quality, offering competitive prices,
or expanding its distribution network to reach new customers.

Ultimately, the success of a seafood company will depend on its ability to compete effectively
with competitors and differentiate itself through offerings, marketing and customer service.

 Bargaining power of customers:

The trading power of the S&A Seafood Company’s

customers may vary depending on several factors such as the
demand for seafood, the availability of substitute products,
the degree of differentiation of product offerings and the
level of customer brand loyalty.

If the demand for seafood is high and the availability of substitutes is limited, customers can
have a high negotiating power as they are able to dictate the prices and quality of the products
they buy. On the other hand, if the demand for seafood is low and there are many alternative
products readily available, customers may have little bargaining power.

The degree of differentiation of product offerings can also have an impact on the bargaining
power of customers. If the seafood company S&A offers unique, high-quality products,
customers may have less bargaining power as they are less likely to turn to other suppliers.
 However, if the company offers generic and standardized products, customers may have a
higher bargaining power because they have more options to choose from.

Finally, the level of customer brand loyalty can also affect customers' negotiating power. If
customers are very loyal to the S&A seafood brand, they may have less bargaining power as
they are less likely to turn to other suppliers. However, if customers are less loyal to the brand,
they may have greater bargaining power as they are more likely to turn to other suppliers for
better prices or quality.

Overall, the negotiating power of the S&A seafood company’s

customers depends on the balance between supply and demand,
differentiation

 Bargaining power of suppliers:

The negotiating power of the S&A seafood company’s suppliers is moderate. The
seafood industry is a highly competitive market and many suppliers are available. This
means that the S&A seafood company has some leverage when negotiating with
suppliers, but not as much as it could in an industry with fewer suppliers.

On the other hand, some suppliers may have strong bargaining power because of the
unique or high-quality products they offer. This may limit the trading power of the S&A
seafood company as it may depend on these suppliers for its business.

In addition, the cost of raw materials, such as seafood, may be affected by factors
beyond the control of the S&A seafood company and its suppliers, such as weather
conditions, epidemics and international trade policies. This can limit the bargaining
power of both parties.

In conclusion, the negotiating power of the S&A seafood company’s suppliers is

moderate and is influenced by factors such as competition, product quality and external
factors that affect the cost of raw materials.

Competitive Position within the Supply Chain

Supply chain management is the integration of activities of the procurement of materials and
services, conversion into semi-finished goods and finished products, as well as delivery to
customers through the distribution system. Viewing the concept of supply chain logistics
management is seen as more wide ranging from basic goods to finished goods used by end
consumers, which is the chain of supply of goods. The main core of supply chain management
is the process of distribution. Distribution is the process for moving and storing goods, starting
from the supplier to the customer level in the supply chain. Products with low price is not
enough, because of the inclusion of the value, variety of products, speed of response, time,
innovation and flexibility become very important. It required a concerted effort from a supplier
of natural raw materials to process into raw materials for the components into finished products,
transport firm that send raw materials from suppliers to the plant, as well as distribution
network delivering products to the customer.

1-Company’s place in SCM :

- S&A Processed Seafood Company is distributor of processed seafood products. and sells to
other distributors.

-Products are not to be sold directly to consumers.

- S&A Processed Seafood Company manages all of its own transportation and warehousing
from pre-production to final storage.

- The company now has one DC in each of its seven markets and supplies each market from the
DC in that country.

- S&A’s Thai suppliers sell products at FOB, and the processed seafood is shipped in bulk via
sea freight from Thailand to the UK.

2- Competitive Advantage :

Competitors in the market in the same industry can achieve competitive advantage according
the ability of a firm to achieve the economic benefits in the income it. Firm that have a
competitive advantage has always had the ability to understand the changing market structure
and being able to choose an effective marketing strategy. One key to the success of an
enterprise is the ability to have and maintain one or several competitive advantages. Further, he
said that the source of competitive advantage lies in the ability of the firm to differentiate itself
from competitors and how he works at a low cost.

Strengthening of the chain, which on one hand should lead to greater consciousness and

comprehension of the competitive realities on part of the individual operators, and on the other
hand favour those actions that increase systematic cohesion in the chain. The last fact is to a
large degree linked to the degree of available information and the nature of information flows
within the system.

Growth of advanced systems of logistics

 for competing food commodities (poultry, etc) may further damage the competitive situation of
the Italian seafood sector;

Network Design and Geographic Considerations

In this section, we well describe and analyse the company’s supply chain
network.

SUPPLIERS

- FLEXIT: Oldest partner + High quality - TECHSOFT has a fulfillment target of

standards. 98%, also TECHSOFT expects the
WORLDCOMM: Best prices + uncertainty to be similar to the past
High flexibility in services. performances.

TECHSOF
T
Manufacturing: Transportation:
Opportunity : Being able to Opportunity: No import tarriff
change the order lead time. from Singapore to the US.
Constraints: Constraints:
3. No changes in production 1. In every flaw in supply
capacity or set up costs chain procurement,
and transportation Techsoft is obliged to
practices. send products via air
4. TECHSOFT doesn’t have expedited.
Warehouses to store 2. In what comes to
finished inventory in transport, less
North America. transportation time means
more costs.
 CUSTOMERS

The opportunity that presents itself is being able to

reduce the service level from 98% to 95% and
90% ( positive response from customers).

Inventory and Flow Planning

Inventory is stored materials that serve a current or impending need. Production and
manufacturing organisations hold raw materials, finished items or works-in-progress to
incorporate into new goods. Retailers stock finished or processed items to sell directly to
customers.
Almost every organisation holds inventory. Even service organisations, such as hotels or
software development companies, keep maintenance, repair and operations (MRO) stock to
support the business. Examples of inventory for a non-production or non-retail company might
include towels and soap, drain cleaner, light bulbs, garbage bags for cubicle bins, pens and
timing belts for delivery trucks. Inventory is one of the largest assets on a company’s books.
Organisations hold inventory for several reasons. By keeping inventory, production or retail
establishments can ensure they operate continuously and independently, with coverage for
variations in consumer demand or stock delivery. In manufacturing, adequate inventory enables
companies to be flexible in output scheduling. You can leverage bulk orders for discounts with
planned inventory.

Staying Strategic in the Warehouse with Better Inventory Flow

Throughout the entire order fulfillment process, companies have a duty to ensure optimum
warehouse efficiency by appropriately controlling inventory flow. Warehouse management
rests at the heart of an effective transportation management strategy, and an inefficient, error-
laden system results in poor shipping procedures, poor customer satisfaction, and deviations
from best practices.
Companies must also consider the potential impact of returns and warehouse capacity. An
overstocked warehouse leads to misplaced product in unusual slots and lost costs. Similarly, an
understocked warehouse results in delayed shipments, irate customers, and poor company
performance.
Every time an item moves in the warehouse, the opportunity for errors exists. Unfortunately,
this includes all possible processes, data collection points, and inbound to manufacturing areas.
Fortunately, a dedicated transportation management system (TMS) in combination with a
warehouse management

Customer Service Level Tradeoffs

 In generale for Customer service, There are often trade-offs that must be made
between different aspects of service quality. These trade-offs can be thought of as
balancing the cost of providing a high level of service with the benefits that it provides
to customers.

Here are some common customer service level trade-offs:

1. Cost vs Convenience : Providing round-the-clock customer service can be

expensive, but it may also be necessary to meet customer demand for convenience.
2. Speed vs accuracy: Rapid response times are desirable, but they must be balanced
with the need for accurate information and solutions.
3. Personalization vs standardization: Customizing solutions for individual customers
can improve satisfaction, but it can also increase the time and resources required to
deliver service.
4. Accessibility vs privacy: Making it easy for customers to reach you can improve
service quality, but it may also compromise their privacy.
5. Proactivity vs reactivity: Anticipating customer needs and proactively addressing
them can improve satisfaction, but it may also increase the cost of service delivery.

Ultimately, the trade-offs that are made will depend on the specific needs and goals
of the organization and the preferences of its customers. The key is to find a balance that
meets both the needs of the business and those of its customers.

But for a seafood company, the trade-offs in customer service level may look different
than for other industries, but there are still some common considerations. Here are some
customer service level trade-offs that a seafood company might face :

 Freshness vs delivery time

 Product quality vs Price
 Custom orders vs standard products
 Availability vs sustainability
 Consistency vs. Variety

Ultimately, the trade-offs that a seafood company makes will depend on its specific
goals, values, and the preferences of its customers. The key is to find a balance that
meets both the needs of the business and those of its customers while considering
sustainability and the impact on the environment.
  Freshness vs delivery time.

Maintaining the freshness of seafood products is essential for ensuring that customers
receive high-quality products. However, delivering the products quickly and efficiently
can be a challenge, as fresh seafood can be perishable and may require specialized
refrigeration and handling during transportation. To balance freshness and delivery
time, the seafood company may need to invest in specialized refrigerated transportation,
implement real-time monitoring and tracking of delivery processes, and ensure that its
staff is trained in proper handling techniques. Additionally, the company may need to
partner with suppliers and distributors who are equipped to handle fresh seafood
products and ensure that the products are delivered in a timely and efficient manner.

 Product quality vs Price

Providing high-quality seafood products is a top priority for a seafood company, but
sourcing and processing the best ingredients can be expensive. To balance product
quality and price, the company may need to implement cost-saving measures, such as
automating certain processes, streamlining supply chains, and outsourcing certain
activities. Additionally, the company may need to implement quality control measures
to ensure that products meet high standards and consistently meet customer
expectations.

 Custom orders vs standard products

Custom orders can be a great way to increase customer satisfaction, but they also add
complexity and cost to the order fulfillment process. To balance custom orders and
standard products, the seafood company may need to establish clear policies and
procedures for processing custom orders and manage inventory levels and ordering
processes effectively. Additionally, the company may need to invest in technology to
automate certain processes and minimize the manual effort required to fulfill custom
orders.

 Availability vs Sustainability

Providing a wide selection of seafood products is important to customers, but it may

also require sourcing from less sustainable fishing practices. To balance availability and
 sustainability, the seafood company may need to implement sustainability policies and
processes, such as sourcing from sustainable fishing practices and using
environmentally-friendly packaging and transportation methods. Additionally, the
company may need to invest in research and development to find new and innovative
ways to provide high-quality seafood products that are both environmentally-friendly
and meet customer demand.

 Consistency vs Variety

Maintaining consistent product quality and taste is important to customers, but it may
limit the company's ability to offer new and unique seafood products. To balance
consistency and variety, the seafood company may need to invest in research and
development to develop new and innovative seafood products while also maintaining
the quality and taste of its existing products. Additionally, the company may need to
implement quality control measures to ensure that new products meet the same high
standards as its existing products.

Technology Considerations
Investing in technology can bring good results in long
term, and here we recommend two solutions:

 Establish an ERP to manage and control the inventory and

the supply chain, which contribute to reduce overall costs.

 Use RFID systems in supply chain.

 Use a tracking software like FlashTrac.

RFID is a technology that makes it possible to identify from distance. Radio

Frequency Identification (RFID) chips, barcodes and scanners are vital pieces of
equipment that can provide innumerable benefits to TECHSOFT. For example,
RFID chips or barcodes can be placed on every product, which gives the
company a way to easily track inventory.
Software like FlashTrac enables the company to consolidate all aspects
of their supply chain in one place. It can digitally organize inventory
data, monitor and manage shipping and tracking information, and create
electronic invoices with ease.

Conclusion

logistics is an essential function of many organizations today. All companies look to

minimize the cost of attaining logistics objectives. Logistics deals with moving
goods from one place to another, handling and storing them. Primary logistics
functions include warehousing, inventory management, transportation, and logistics
information management.

As mentioned above, one of the functions of logistics is warehousing. One must

wonder just why warehousing is that important anyway. It seems like it is only about
storing goods in a prominent place. There is much more to it in the background. It
involves all the other functions of logistics; that is, all processes are interrelated and
affect each other. For example, effective inventory management is essential for
minimizing warehousing costs.

This is where Warehouse Management System, or WMS, comes in – to achieve

logistics functions in the most efficient and cost-effective manner.