Operation strategy for Black tea product

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The main content of this document is niche market and competitive priorities, designing of Viettea, process to produce Viettea, location for the manufacturing and roduction plan and MRP.

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Nội dung Text: Operation strategy for Black tea product

Operation strategy for Black tea product Viettea A product of VinaGangz.Ltd from the fllowing founder: 1. Tran Trong Dat 2. Nguyen Thị Ngọc Anh 3. Hoang Van Hanh 4. Nguyen Khanh Linh 5. Vu Hong Ha Introduction about Vinagangz: Operation strategy for our new product “ Viettea” I. Niche market and competitive priorities II. Designing of Viettea III. Process to produce Viettea IV. Location for the manufacturing V. Production plan and MRP VI. Scheduling VII. Inventory VIII. Quality management
I. Niche market and competitive priorities A. Niche market Our company has chosen Russia as the suitable market for our black tea products, Because 1. Small domestic market capacity Vietnam is considered as the "cradle" of the world tea industry, quality tea is good, has a long tea culture, but the consumption of tea in the country is too low. According to leaders of the Vietnam Tea Association, our country has nearly 90 million people, but the tea consumption in the country only reached 30,000 tons of tea per year, if the average per capita only reached 300gr tea / person / year. This figure is too low compared to the potential of the domestic market. According to the General Statistics Office of Vietnam, in 2016, the country has a tea plantation area of 131,500 hectares; Output reached 1,020,000 tons. Meanwhile, the average per capita tea consumption in China is more than 1kg of tea per capita per year, in Japan it is 2kg per capita per year, in
Middle East countries it is more than 2kg per capita per year in Russia. , England is over 2.5kg / person / year, nearly 10 times the consumption of tea in Vietnam. Market capacity is too small, which will be a difficult factor for Viettea when producing tea in the condition of limited tea demand. 2. Demand for tea in Russia is very high Tea is one of the most popular drinks of the Russian people, with about 98% of the population drinking tea, in the past few centuries, tea is increasingly asserting its position as the most popular drink in Russia with the effect The tea is the only beverage the government passes and the list of essential consumer items is a strategic item equal to salt, cooking oil and national reserves. war precautions, natural disasters. Russia is one of the 10 largest consumers of tea in the world and ranks third in the world's largest tea consumer. Average consumption of tea per capita increased from 0.56 kg / person 1994 to 1.01 kg / person 1997 and 1.1 kg / person since 2000. The growth rate of pepper demand average annual average of 11.3% in the last 10 years; With stable demand growth, total tea consumption of the mussel market is about 150 thousand tons / year, worth over 250 million USD / year. Currently there are around 3,000 different types of tea (green tea and processed tea) in the world. Among them, over 1000 kinds of tea have different brands. Black tea is the most popular and traditional tea consumed in Russia accounting for 90% of total tea consumption. Demand for highquality and highvalue tea has increased rapidly in recent years and accounts for about 5% of total consumption (green tea 1%, tea 4%). However, Russia has to import up to 99% of tea materials, mainly from Sri Lanka, India, China, Vietnam, Indonesia, Kenya. Therefore, the Russian market is a fertile market and there are many opportunities for development of Viettea's tea products. 3. Agreements and trade promotion programs between Vietnam and Russia. Free Trade Agreement Vietnam Eurasia Economic Union, 2018 (VNEAEU FTA)
On May 29, in Kazakhstan, Prime Minister Nguyen Tan Dung and other Prime Ministers of the Eurasian Economic Alliance, including Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan, officially signed the Trade Agreement (FTA) between Vietnam and the Eurasian Economic Coalition. Ministry of Foreign Affairs of Vietnam has informed in writing that the two sides have completed the ratification procedures and the FTA between Vietnam and the Eurasian Economic Union officially took effect from October 5, According to the Decree on the Free Trade Agreement between Vietnam and the EEA (VNEAEU FTA), in 2018, 5,535 tariff lines will be cut to 0% and 3,720 tariff lines will be continued. to 0% in which black tea products are taxed according to the schedule with tariffs of 26.7% in 2016 and to 2018 only 13.3%. This will be a great opportunity for Viettea to enter the Russian market when it is able to compete on prices for other tea products in the Russian market. Not only that, implementing the national trade promotion program approved by the Minister of Industry and Trade in Decision No. 4838 / QD BCT on 28/12/2018 Vietnam Tea Association organizes trade and tourism delegations. at the Coffee and Tea Expo Russian Market Through the program, enterprises can promote the promotion of Vietnamese tea products in this market and at the same time create opportunities for enterprises to meet directly with tea partners and importers. of Russia and its neighboring countries. Expanding the market and exploiting information, finding potential market partners, maintaining existing partnerships, promoting trade and import and export of tea. Organizing trade delegations to help businesses catch the latest happenings in the market, grasp the needs of consumers tastes learn about the packaging design products. Access to, understand the rules of international trade, the latest regulations on trade quality and regulation of the market 4. Support for transportation from Russia EXPERIENCE EXPOCENTRE, said Sergey Gusev, EXPOENTRE, has a subsidiary that provides transportation and cargo clearance services.
Therefore, when participating in the fairs and exhibitions in the Russian Federation, Vietnamese companies contacting the company will be instructed very specifically about each type of documents. On the issue of geographic location, the Russian Federation Government is considering a special mechanism to transport rail freight from Southeast Asia to the Russian Federation. This mechanism will be very favorable for Vietnamese enterprises because rail transportation will be faster and more economical than air and sea transportation. This will help ease the cost of transporting tea products from Vietnam to Russia. B. Competitive priorities Our Black Tea product have a lot of competitive priorities with other beverage product like: 1. Boosts Heart Health There have been numerous studies revealing black tea’s positive impact on heart health. A study published in 2017 looked at the effects of tea consumption on the risk of ischaemic heart disease. The study looked at more than 350,000 men and women between the ages of 30 and 79 from 10 areas in China. When the researchers followed up about seven years later, they found that consumption of tea was associated with a reduced risk of ischaemic heart disease as well as a lower risk of major coronary events (like a heart attack). Another study compared black tea (without additives) drinkers to plain hot water drinkers for a period of 12 weeks. The black tea contained high amounts of flavan3ols, flavonols, theaflavins and gallic acid derivatives. The researchers found that daily consumption of nine grams of black tea resulted in “a highly significant decrease” of cardiovascular risk factors, including triglyceride levels and fasting serum glucose. There was also a significant decrease in the ratio of LDL to HDL cholesterol as well as an increase in HDL (“healthy”) cholesterol levels. Overall, the researchers conclude that drinking black tea “within a normal diet” leads to a decrease in major cardiovascular risk factors, and it also boosts antioxidant levels in humans. 2. May Help Fight Cancer Cancer fighter is also on the list of black tea benefits, as black tea consumption has been linked with the reduction of certain types of cancer. For starters, a 2013 study
published in the American Journal of Epidemiology investigated the effects of consuming flavonoidrich black tea on prostate cancer risk in over 58,000 men in the Netherlands who provided detailed baseline information on several cancer risk factors. Black tea is considered a major source of healthpromoting flavonoids like catechin, epicatechin, kaempferol and myricetin. The study revealed that increased flavonoid and black tea intake was linked to a lower risk of advanced stage prostate cancer. However, no associations were observed for overall and earlier stages of prostate cancer. Another promising study published in 2016 showed how the theaflavin3 found in black tea had a very strong ability to stop the growth of cisplatinresistant ovarian cancer cells. A highly impressive finding since cisplatin is said to be “one of the most effective broadspectrum anticancer drugs.” In addition, the theaflavin3 was less toxic to the healthy ovarian cancer cells, which is awesome since many conventional anticancer drugs kill both cancerous and healthy cells. 3. Helps Reduce Risk of Diabetes Diabetes is an evergrowing chronic health problem around the world. A study published in the journal Diabetologia wanted to look at tea (and coffee) consumption in relationship to the development of type 2 diabetes. The study involved 40,011 participants, and at the mean followup time of 10 years, the researchers found that 918 subjects had developed type 2 diabetes. They also found that drinking both tea and coffee was linked with a decreased risk of type 2 diabetes. Specifically, consumption of at least three cups of tea or coffee per day reduced the risk of type 2 diabetes by about 42 percent. This makes black tea beneficial as part of a diabetic diet plan. 4. Potentially Staves Off Strokes A metaanalysis published in 2009 found that drinking black or green teadaily may prevent ischemic stroke. Specifically, the researchers found that regardless of what country the subjects came from, the people who drank the equivalent of three or more cups of tea each day had an overall 21 percent lower risk of stroke as compared to the subjects who drank less than one cup daily. 5. Relieves an Upset Stomach If you have an upset stomach and are experiencing diarrhea, then one nice strong cup of black tea may be just the answer. The tannins present in black tea have a
helpful astringent effect on the intestinal lining, which can help calm inflammation in the intestines and get the diarrhea under control. If you’re concerned you’re dehydrated, you can opt for decaffeinated black tea. A 2016 study showed that in 2 to 12yearold patients with acute nonbacterial diarrhea, black tea tablets were not only an effective, but also a safe and inexpensive way to help manage diarrhea not caused by bacteria. 6. Holds Antibacterial Ability Black tea isn’t just a tasty beverage hot or cold — it also possesses potent antibacterial and antioxidant powers. Research has shown that black tea’s phenolic compounds as well as its tannins have the ability to inhibit some types of bacteria. In addition, the nonpolymeric phenolic compounds are able to be absorbed by the gastrointestinal tract, making these bacteriakilling components of black tea orally active. Black tea consumed with honey has also been shown to specifically kill H. pylori bacteria, which can prevent all kinds of unwanted symptoms of a H. pylori, infection including ulcers. 7. Lowers Stress Hormones This is definitely one of my favorite black tea benefits. While coffee is known for getting some people a little too energetic, tea has a reputation for being more of a balanced caffeine source and even a relaxation beverage that can work as a stress reliever. Research has shown that black tea can actually help its drinkers better recover from the common daily stresses of life by bringing stress hormones, like cortisol, back down. In one study, 75 healthy male tea drinkers with an average age of 33 all gave their usual caffeinated beverages and were split into two groups. For the following six weeks, one group consumed a fruitflavored caffeinated black tea mixture containing the active ingredients found in a cup of tea while the other group drank a beverage that tasted the same and had the same level of caffeine yet did not contain any other active tea components. The subjects then underwent stressinducing situation similar to what they would experience in normal life. Researchers kept track of their stress hormone and blood pressure levels as well as their heart rates and selfreported stress levels. What did they find? The tasks were definitely stressinducing according to all of the monitored health variables, yet 50 minutes after the stressor took place, the real black tea drinking group experienced a lowering of their cortisol levels that was noticeably lower in comparison to the fake black tea drinkers. The real black tea consumers also had
their sense of relaxation rise after the stressful event compared to the fake group. And to add one more positive result of this study — black tea drinkers had lower blood platelet activation, which is involved in blood clot formation, which raises the risk of heart attack. With other Black Tea product we still have some advantage to compete like: First, we focus on raw materials, ie, looking for the best quality tea leaves. This requires a high level of expertise. Therefore, we have a team of experts to try their own tea to ensure the quality of tea is best. Viettea's experts not only understand the tea leaves but also understand the growers of these products because the process is very much related to the human factor. In addition to natural conditions such as climate, soil and tea varieties, skills and ingenious hands of the people to create the best quality tea is one of the things that we own. The second is the mixing technique. Tea leaves picked from the same tea garden at two different times will have different flavors due to the influence of weather changes. Therefore, in order to maintain the quality and stability of flavor, Viettea tea is mixed from many tea leaves of different tea gardens in a certain percentage. Thirdly, all employees of Viettea are professional tea testers. People share their passion and really care about the quality of what is created to serve the customer. Therefore, "secret weapon" of Viettea tea is passion. II. Designing of Viettea In keeping with the rationale that we had previously created for the range of Viettea, we stripped back the unnecessary detail to create strong, singleminded designs that feature a clear and singleminded approach to colour to establish and differentiate the range clearly in the fixture. To achieve this, we enlisted the help of fashion illustrator Van Hanh to bring his trademark distinctive ink illustrations and expertise from big projects to help bring the Black Tea designs to life, and to enheighten premium cues and allow Viettea to market the range at a higher price point. The core black teas have a clean look and feel with Ihe typeface lending a dash of the East, and reflecting the origins of the tea. Viettea built on the core range design for the flavour blend teas, exploring ways of bringing in refreshment through a range of colours and evocative imagery to create an abstract expression of the taste and experience of the tea blends. The Viettea black tea designs now challenge the category trend of showing photography of the ingredients,
resulting in a more evocative and artistic look and feel that is unique and stands out from the crowd. The relaunch saw the introduction of new black teas, crafted to be marketed at a more premium level`. These designs were inspired by Ihe provenance of these special, handpicked, single origin flush teas. The mountainous Thai Nguyen regions are depicted on the front of pack, whilst the background maintains the design features of the core range, making the world of black teas easier for the consumer to explore. III. Process to produce Viettea Process of processing black tea standard in the world we do as follows: a) Wilt phase: The purpose of this stage is to reduce the amount of water in the tea buds, facilitating the process of tormenting. By wilting, the tea's buds shrink by 3840%, making the tea buds more resilient to help the crumbling process. When the amount of water is reduced, the content of dry matter becomes dense, which facilitates the biochemical reactions and other alteration processes, facilitating the improvement of tea quality. Protein changes deeply to form dissolved amino acids. Some other substances such as vitamin C, chlorophyll, and starch decrease, caffeine has increased slightly due to acidic form of caffeine. The conditions required to wilt well are: Humidity: 60 70% Temperature of air: 44 45oC Withering time: 3 4 hours b) Stage torment: Watersoluble substances in the cell, especially Catechins, which are required for oxidation under the action of polyphenols and peroxidases must have access to oxygen, thus breaking down the skin and cell membranes. Transfer the enzymes as their substrates to the leaf surface. In addition, due to the process of melting, the dissolved substances will enter the hot water well and faster when the tea is mixed, and the volume of tea mass is also reduced. The process of reaching the cell tilt of 7075%. Depending on the scale of production, each crane weighs 120160kg. Crushed 3 times. The duration is 45 minutes, the temperature is 22 240 C, the humidity is 90 92%.
The process of sorting between juices aimed at separating the small part of the tea from the mass of the tea leaves, creating favorable conditions to reduce the temperature and create new mechanical properties for the next process. be favorable. After sorting through the sieve, the specimens were sized and crushed to a depth of 4 5 cm and fed to the fermentation process. c) Fermentation stage Fermentation is the center of black tea processing, a process that is extremely important to the quality of tea. Thanks to this process, the raw materials after the two preliminary preparations are wilted and subjected to profound chemical transformation to produce the color, taste and appearance of the finished tea. The scientists divide the tea leaves into two phases (two phases). At one stage, the leaf cells are broken down after the first stage, which lasts for 23 hours. Phase two from the beginning of the tea into the fermentation room until the fermentation process ends. To facilitate the fermentation, the chamber and fermentation must maintain the temperature in the limit of 24 260C and air humidity must reach 95 98%; the air in the room and fermentation need to adjust to ensure every 7 100kg of tea has about 1m3 of clean air. d) Drying stage The purpose of this stage is to use high temperature to suspend fermentation processes in order to stabilize the quality of the tea, resulting in approximately 7 9% of the remaining water required by the market. The drying temperature is from 95 to 1050C and the drying time is from 30 to 40 minutes. After the drying phase is completed the process of processing tea finished, through the classification system, classified packaging and put into the market. e) Stage of tea preparation There are two types of tea: Yarn is crispy, called traditional tea or OTD tea (OTD tea): After sorting in the refining process divided into many types depending on the quality of tea as OP (Orange Pekoe, Pekoe Shouchong, BOP, Broken Pekoe, BPS, Fanning S, Dust, From young buds, leafy leaves, old leaves. Cut into small pieces, called CTC tea (Crushing = Tearing = Tear): Taste, flavor like black tea OTD but fast, convenient to use, very popular in industrialized countries.
For the tea varieties of shan tea (good quality: TB14, LD97) due to the large buds can be processed in accordance with CTC technology process to overcome the large appearance of the processing process OTD. IV. Location for the manufacturing Location has a major impact on the overall risk and profit of the company. Some costs that maybe influenced by location included transportation costs, taxes, wages, raw material costs, and rents. When all the costs are considered, location may alter total operating expenses as much as 50%. The objective of location strategy is to maximize the benefit of location to the firm. Because of the stated reasons, we decide to choose Thai Nguyen as a suitable place for tea manufacturing. Natural conditions and economics conditions are the decisive factors effect on the location decision. 1. Natural conditions: Topography: Thai Nguyen is a midland mountainous province, but the terrain is not very complicated compared to other midland and mountainous provinces, which is a good advantage of Thai Nguyen for agroforestry and development. The socio economic situation in general compared to other mountainous and midland provinces. Forest resources: Forests in Thai Nguyen are mainly artificial forests and planted forests under Program 327, PAM plantations, Xinjiang tea areas and other crops of the people. Climate, rivers: Favorable conditions for development of perennial crops, especially tea plants, river systems with many rivers flowing through the province can build many hydropower plants combined with irrigation small scale, with abundant groundwater reserves, which is favorable for irrigation system cultivation. The soil of the famous tea areas of Thai Nguyen as Xinjiang; La Bang or Hoang Nien contain the best trace elements suitable for tea tree grow best. Because the land here is formed on the ancient alluvium and sandstone. The form of red sand clay with clay in this place makes Thai Nguyen tea is always flowing and sweet lasting characteristics that only here. 2. Economics conditions: Economic: Thai Nguyen's economy is growing and it is impossible not to mention the agricultural economy of "tea plantation". Thai Nguyen has long been famous for
its history of tea cultivation. The tea gardens, green tea fields are open, it is thanks to the hands of the people here, and in it the most famous is still Xinjiang tea, with special taste, where tea is not anywhere. Xinjiang tea has made a brand and become the key economic of the region and the city of Thai Nguyen. Low labor cost Thai Nguyen is located near the large consumption areas such as Ha Noi, Vinh Phuc, Phu Tho,… V. Production and MRP plan 1. Production plan Through surveys of the black tea consumption market at the time of year and evaluation of Viettea's product testing by customers in Russia, the company analyzed and forecasted the demand for Viettea tea products. As follows: Demand forecast Period Tons 1 40 2 47 3 59 4 65 This figure is not really because Viettea have to compete with other world famous tea products such as Lipton, Dilmah, Cozy ... and also because Vietnamese tea products are not really famous and be popular with the customer in Russia. Although the demand is relatively low but the company has just set up and directed to high quality black tea so only 1 modern production line was imported from Japan. Therefore, the output of black tea can not be produced enough to meet the demand of tea. Therefore, the company needs a proper production strategy to minimize costs The time required for the production of Viettea tea: Wilt phase: 4 hours Stage torment: 3 hours Fermentation stage: 4 hours Drying stage: 0.5 hours
Sorting and packaging: 0.5 hours So, the current production line can only produce 300kg black tea per day, equivalent to 36 tons per quarter. If employees work overtime 4 hours, there will be 100 kilograms of black tea more per day equivalent to 12 tons per quarter. The company can rent out equipment to compensate for the lack of black tea at a relatively high price of $ 80 / tons with a maximum production volume of 20 tons per quarter. Specific information: Initial iventory: 10 tons Regular cost per ton: $50 Overtime cost per ton: $65 Subconstract cost per ton: $80 Carrying cost per tons per period: $1 Back order cost per ton per period: $4 De Sup man Total capacity available ply d Fro for m Unused Period 1 Period 2 Period 3 Period 4 capacity Begi nni ng 0 1 2 3 0 10 inve ntor y 10 Peri Reg 50 51 52 53 0 od 1 ular time 30 6 Ove 65 66 67 68 0 36 rtim 4 8 12 e 80 81 82 83 0
Sub cons 20 tract Peri Reg 54 50 51 52 0 36 od 2 ular time 36 Ove 69 65 66 67 0 12 rtim 5 7 e Sub 84 80 81 82 0 20 cons 20 tract Peri Reg 58 54 50 51 0 36 od 3 ular time 36 Ove 73 69 65 66 0 12 rtim 12 e Sub 88 84 80 81 0 20 cons 20 tract Peri Reg 62 58 54 50 0 36 od 4 ular time 36 Ove 77 73 69 65 0 12 rtim 12 e Sub 92 88 84 80 0 20 cons 9 11 tract Total demand 40 47 59 65 71 282 Cost: Period 1: 10*0 + 30*50 = $1.500 Period 2: 6*51 + 36*50 + 5*65 = $ 2.431 Period 3: 4*67+ 7*66 + 36*50 + 12*65 = $3.310 Period 4: 8*68 + 36*50 + 12*65 + 9*80 = $3.884
Total cost: $11.125 2. MRP plan Viettea is produced 100% pure fresh tea, so the company needs to calculate the amount of tea to ensure enough for production needs. However, the company currently has only 32 hectares of tea that can be harvested at a yield of 5 tons / ha / year, equivalent to 160 tons of tea per year. Therefore, in order to meet the demand for production, the company needs to purchase more tea on its own farms with the specific quantity of tea as follows: Period 1: 0 ton Period 2: 7 tons Period 3: 19 tons Period 4: 25 tons The company will screen and thoroughly examine the tea products purchased from outside to ensure the quality and standard of the company. The price paid for the farmers' tea is $ 400 per ton. VI. Scheduling Scheduling is defined as the process of arranging, controlling and optimizing work and workloads in a production process or manufacturing process. Viettea uses it in order to response to large customer orders, accommodate resource changes, reduce costs and increase overall production efficiency. The objective of scheduling is to allocate and prioritize demand (generated by either forecasts or customer orders) to available facilities. The strategic importance of scheduling: Effective scheduling means faster movement of goods and services through a facility to lowers cost. Add capacity, faster throughput, and the related flexibility mean better customer service through faster delivery. Good scheduling contributes to realistic commitments, hence dependable delivery. Scheduling techniques are categorized as forward scheduling and backward scheduling
Forward scheduling: Viettea begins the schedule as soon as the requirements are known. We use a variety of organizations such as manufacture and package factories, stocks, sale agency, supermarkets, retailers… and make sure that jobs are performed to customer order, and delivery is often requested as soon as possible. Backward scheduling: Viettea also begins with the date by scheduling the final operation first and the other job steps in reverse order. The 4 scheduling criteria are: Minimize completion time Maximize utilization Minimize workinprocess (WIP) inventory Minimize customer waiting time Scheduling processfocused facility: A highvariety, lowvolume system commonly found in manufacturing and services, also called an intermittent, or job shop, facility. VIII. Quality management Viettea’s Quality Policy: We are committed to ensuring our continuous development through the use of quality management systems and standards, thereby also increasing trust and acknowledgement for the brands we market In order to meet our quality and business objectives we use some of quality management technique. One of the most outstanding strategy is kaizen theory Kaizen is a Japanese word. KAI means change and ZEN means better, the two words together mean change for the better, or improvement. This 5S system describes how to fill the organization work gap to improve the efficiency and the effectiveness by identifying and storing the items used, maintaining the areas and items, and sustain according to the new order. o SEIRI : Sort through and sort out o SEITON : Standardize and share information o SEISO : Set in order o SEIKETSUS : Sustain the improvements made
o SHITSUKES : Shine and inspect through cleaning Viettea use kaizen for o Small improvements first rather than on the big ones, o Utilizing everyone’s potential and knowledge rather than depending on a few experts o Implementing a continual stream of small improvements at a steady pace rather than some big changes once in a while, o Done at every place where some work is done. Another technique Training: o Viettea has identified and documents the skill requirements for each position and competency levels necessary for each employee to perform their job safely and effectively Customer Satisfaction: o Viettea has implemented a procedure for measurement and analysis of customer satisfaction data against established customer requirements and expectations and takes actions to ensure they are met Continual Improvement: o Viettea has continually improve the effectiveness of its quality management system using the business plan, quality statement, objectives and metrics, audit results, analysis of data, corrective and preventive actions, and management review Viettea use the ISO 9001 system and other quality standards determined by the management of the company (HACCP Hazard Analysis and Critical Control Points, …).