Pratik Mehta's Profile
Megan, this discussion reminds me of the classroom discussion for the Ikea case. Even though Amazon has taken several steps to become more sustainable within its business model, its current business model remains unsustainable with individual delivery and packaging for each purchase. Since Amazon does not disclose carbon emissions data unlike peers and did not hire sustainability personnel until last year, it seems that Amazon remains more focused on growth and customer convenience rather than on sustainability.
Due to SEC rules, Amazon identified no suppliers that were sourcing through a supply chain that benefited armed groups in the Congo. Thus, it seems possible, though likely expensive, to conduct a similar review for specific sustainability purposes.
J, it seems like these warehouses can be digitized even further in the medium term by increasing machines and reducing employees for the loading roles. Like the Barilla distribution video, machines should be able to move pallets appropriately, to the warehouse or to trailers, if the pallets are marked as a certain type of beer and quantity. This additional digitization may reduce space, utility, and labor costs, as some of the field trip participants described in class, even though it requires upfront capital expenditures to purchase these machines.
As you mention, each warehouse is different based on its SKUs, direct loading rate, and space. Managing adjustments to Interleaving or the machines described above for each warehouse will always require human input, which may be a bottleneck as it is in Cartersville.
Minghao, thanks for introducing me to this Chinese company. YiGuo’s digitization focuses on farmers and direct producers, but digitization can also apply to intermediaries like farmers’ markets and supermarkets. If consumers demand a certain product at a certain time, YiGuo may be able to source it closer to the consumer and provide delivery. I wonder if this intermediate digitization fits with YiGuo’s customer promise.
You do not focus on YiGuo’s mapping and delivery optimization, but hopefully the company is able to batch orders by pockets of farmers and pockets of consumers. In a way, the company is returning to old days, where milk would be delivered to each home in the morning. Farmers should have greater point-of-sale data about consumer needs for future growing seasons from this company too.
Sarah, I appreciate the non-public access to the effect of isolationism on LFP. I suspect that other food producers and businesses relying on low-income labor near the US/Mexico border are facing similar effects. I am surprised that the e-verify agency faces no potential for penalties or legal action. The e-verify agency should owe a duty to its customers that it will not lie about or distort workers’ legal documentation.
It would be interesting to quantify the effect of isolationism on LFP. You mention overtime, increased salaries, switching costs to another e-verify agency, and development programs to train unskilled workers. The total increase in labor costs as a result of isolationism could serve as a focal point for LFP’s policy-oriented lobbying efforts. Politicians may not be considering the full impact of isolationism on businesses.
Melissa, I agree with your recommendations of lobbying and licensing in order to avoid unfavorable tariffs. Unfortunately, none of the other major alcohol producers are headquartered in the UK and similarly impacted by Brexit as Diageo. AB InBev is in Belgium, Pernod Ricard is in France, Heineken is in the Netherlands, Constellation is in the US, etc. Diageo may be going it alone or leading the charge in its UK lobbying efforts. Thus, Diageo may need to rely on licensing or sourcing locally, even though that step may lead to lower quality and efficiency.