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Running head: OPERATIONS MANAGEMENT: KUDLER FINE FOODS
Operations Management: Kudler Fine Foods
Operations Management: Kudler Fine Foods
Kudler Fine Foods (KFF) is an upscale gourmet food store in the San Diego metropolitan
area. Over the past five years the company has grown and now operates three local stores.
As a result of the company rapid growth, the owner, Kathy Kudler, has decided to begin
contracting with local growers of organic produce. If the company proceeds with this plan,
operational changes will be necessary. This paper will identify the business processes that
will be affected by this decision, how the supply chain will be affected, and describe the
quality control tools and performance standards that Kudler will need to put in place to
ensure the effectiveness of the operation.
At this time, KFF does not have a purchasing department in any of its stores. The
department managers at each of the three stores are responsible for placing their own
orders and ensuring that they get the best possible price from the suppliers. The department
managers primarily use a make-to-stock process to maintain inventory levels for the
customers. Using this process, the department managers forecast future sales based on
historical sales data. However, the forecasting method has not been as successful as the
company expected and these shortcomings have led to excess inventory that resulted in
discontinuing some products and drastically reducing the prices of others (University of
Phoenix, 2003). Contracting with local growers of organic produce will allow KFF to
transition its business process from a make-to-stock process to a just-in-time (JIT) system.
In a JIT system, the firm inventory of input
