Analysis of the Cost Structures of the Food and Beverage Consumer Packaged Goods Industry and Formulation of a KPI Framework to Quantify the Impact of Optimization
Leung, Daniel (2024)
2024
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024112931395
https://urn.fi/URN:NBN:fi:amk-2024112931395
Tiivistelmä
This product-based thesis analyzes the cost structures, value creation mechanisms, and measurement metrics within the Food and Beverage Consumer Packaged Goods industry. The com missioning company is a supply chain planning software provider, with a focus on quantifying the impact of computer optimization on the production process in the Consumer Packaged Goods sector.
The theoretical framework explores market structure, competitive dynamics, and supply chain management within the Consumer Packaged Goods industry. It also defines the concept of Cost-to-Serve analysis, discusses value measurement methodologies, and introduces mathe matical and heuristic optimization techniques. Following this, the development process and timelines of the project outcomes are detailed.
The thesis presents two main outcomes, each complementing the other: firstly, a Cost-to-Serve analysis, conducted through financial statement analysis, identifying and comparing key cost drivers like raw materials, distribution, and administrative expenses across product groups; and secondly, a Key Performance Indicator Framework based on the findings from the Cost-to Serve analysis. This framework proposes a set of ‘best practice’ KPIs to be integrated into the software for measuring the impact of optimization on cost elements. Together, these outcomes aim to provide measurable value to the commissioning company and its clients by establishing a practical measurement framework based on cost element analysis.
The discussion section analyzes the findings using insights from the theoretical framework and expert input from the commissioning company. The report concludes with recommendations for future development, an assessment of the reliability and usability of the results, and reflections on the author’s professional growth.
The theoretical framework explores market structure, competitive dynamics, and supply chain management within the Consumer Packaged Goods industry. It also defines the concept of Cost-to-Serve analysis, discusses value measurement methodologies, and introduces mathe matical and heuristic optimization techniques. Following this, the development process and timelines of the project outcomes are detailed.
The thesis presents two main outcomes, each complementing the other: firstly, a Cost-to-Serve analysis, conducted through financial statement analysis, identifying and comparing key cost drivers like raw materials, distribution, and administrative expenses across product groups; and secondly, a Key Performance Indicator Framework based on the findings from the Cost-to Serve analysis. This framework proposes a set of ‘best practice’ KPIs to be integrated into the software for measuring the impact of optimization on cost elements. Together, these outcomes aim to provide measurable value to the commissioning company and its clients by establishing a practical measurement framework based on cost element analysis.
The discussion section analyzes the findings using insights from the theoretical framework and expert input from the commissioning company. The report concludes with recommendations for future development, an assessment of the reliability and usability of the results, and reflections on the author’s professional growth.