Managing uncertainty in whiskey supply chain

Filed in archive Point of view on June 3, 2006

I used to work in an oil company, where we were producing lube oils for cars and industrial applications. Recently, I noticed that there are a lot of similarities between lube oil business and WHISKEY business from supply chain point of view.

Whiskey and whiskey business are wonderful things to look at and you can learn a lot from those companies on how to manage uncertainty in the supply chain.

There is an interesting article in Technology Evaluation titled "Must-have Requirements for the Whisky Industry" which discusses some major issues on how to deal with SCM challenges.

The whisky industry is an example of a process industry where it is impossible to predict what consumer demand will be when the product is ready for delivery. It is also an industry where companies must meticulously account for goods stocked as intermediates (partially finished) and as bulk goods (both finished and partially finished).

But, although it may be impossible to accurately predict consumer demand in the case of a twenty-year (or longer) product lifecycle, that certainly doesn't mean that the entire process has to be reduced to Alchemy. In fact, the more finely honed the process, the better able companies will be to adjust to rises and falls in demand.

Some of the most important issues to care about in this business are:

- Blend optimization:

- HM C&E documentation

- The ability to track and control the automatic billing of warehouse rents

- The management of both liquid inventory and casks:

I recommend you read this article. It worths taking a look.