2. Background & Aims Growing demand for coffee
To meet growing demand – Costa Express Machines
Petrol stations
Companies
Airports
Railway stations
Convenience stores
Hospitals etc.
Aim in 2011 – increase Costa Express Machines from 900 in UK to 3,000 by 2016

3. Managing & replenishing coffee making ingredients to partner sites
Old System
Send out coffee-making supplies (for free) and share revenue with partner
Managed by finance division of Costa
Wasted stock / turned away deliveries
Too much data from telemetry chips inside machines – not put to best use
Logistics provider managed purchasing of ingredients
Costa had few relationships with ingredient suppliers

4. A Fresh Start – Supply Chain Manager Appointed
Move responsibility for replenishing machines to supply chain team
Make better use of telemetry data
Tender for new logistics partner
Purchase ingredients directly
Gives better control of quality & costs
One central warehouse location enabling next day delivery
Greener transportation
New IT system to improve forecasting accuracy

6. Savings / Wins 20% fall in stock being held at ‘partner’ sites
50% fewer delivery refusals
Centralised stock-holding locations reduced from 9 to 1
Developed direct purchasing relationships with 15 suppliers
Negotiated new product prices and pack sizes leading to a reduction in the purchase price to consumer for some items
30% fall in annual logistical operating costs
CO2 emissions reduced by 70 metric tons

7. Other benefits
Employees can focus on serving customers and increase sales
Increased revenue and customer satisfaction

8. Going Forward 3,000 machine target achieved by 2013
Now introducing Costa Express machines in Ireland and ‘Costa Heaven’ machines in Poland