QUESTION ONE [25] Read the following and answer the questions that follow: Beer — it’s been a staple in many cultures fo

[answerhappygod]

QUESTION ONE [25]
Read the following and answer the questions that follow: Beer —it’s been a staple in many cultures for thousands of years and isstill one of the world’s most popular drinks. From paddock to pint,an intricate set of systems and processes are undertaken to placethat frothy cold brew in your hand. Each link in the beer supplychain comes with its own issues and challenges. During 2020 theCovid-19 pandemic was one of these and will continue to be so forsome time. Post pandemic, evolving pressures will endure to disruptthe beer supply chain in 2021 and beyond. Beer supply chains willneed to be flexible to adapt and survive the changes and challengesahead.
The beer supply chain is a system of crucial steps taken fromrecipe conception through to production, brewing, bottling anddelivery to the consumer. This journey from the field to the fridgeincludes sourcing essential raw materials such as malt, hops, andyeast, along with the people, production activities, information,and resources involved in getting a beer into the hands of yourcustomers. Complex beer supply chains involve multiple channelmembers including growers, brewers, distributors, and retailers.Contemporary supply chains are based on the direct-to-consumermodel made possible through the growth in eCommerce and madenecessary through the Covid-19 pandemic. Beer, like any otherproduct, follows the rule of supply and demand, but the brewingprocess can be complicated and so too the beer supply chain. Itstarts first with the raw ingredients needed for production andpackaging and stops when the beer is delivered to the end user.This could be home delivery of a carton from an online order orwhen the barman pours a pint for a pub patron.
Raw materials
Raw materials include essentials such as water, malt, hops, andyeast. Additional ingredients like coffee beans, spices, and sugarare also used for innovations and twists on the traditional brew.It is estimated that 39 million hectares of barley was harvested in2019. Roughly 70 percent of that was used as animal feed while theother 30 percent or 11,817 hectares was used to produce malt forthe brewing of beer.
The beer industry is currently experiencing a scarcity of hopsdue to adverse weather, bush fires and other environmental events.With rising temperatures reducing soil moisture and draughtsexacerbating water shortages, climate change poses a real threat tothe availability of the raw materials of the beer supply chain.Additionally, Ramularia disease is affecting barley crops, and thearable land area used for growing crops are shrinking. Consumerdemand for sustainable crops and locally sourced produce is andwill continue to be key factors for raw ingredients in the beersupply chain.
Production
Beer production has always been labour-intensive, particularlyin the smaller craft and boutique breweries. Brewery software andsoftware-as-a-service platforms offer microbrewers real-timesolutions to improve the efficiency of brew production. These toolslink forecasts to production schedules and supplier contracts,providing complete and detailed insights to track ingredients andexpiry dates, and offer analytics to predict seasonal demandfluctuations. Software solutions replace manual methods ofinventory tracking to provide access to better management tools andaccurate financial data. Implementing basic automation into breweryoperations can reduce labour and improve product consistency.Simple automation reduces manual tasks like checking temperaturesusing single input computer chips and a single output coolingvalve. More complex well-designed automation systems are extremelyflexible, enabling brewers to make changes and easily program newrecipes.
Packaging
The increase in demand for craft beer has led to a correspondinggrowth in the beer packaging market. Beer packaging is the part ofthe beer supply chain that involves the bottling and labelling ofbottles, PETs, cases, and kegs. However, the many benefits of glassmean that glass packaging is expected to have the largest marketshare of the industry moving forward. Glass is reusable,recyclable, and it keeps beer fresher for longer compared to otherpackaging materials. Glass is also a good insulator which keepsbeer colder much longer than any other type of single-usepackaging. Additionally, glass reduces the risk of spoilage becauseit has a zero rate of chemical interaction with other products, andamber glass beer bottles prevent light from entering the bottle Thebeer packaging market is competitive and appears to be fragmented.Suppliers are competing on price, capacity, volume, and quality.The popularity and demand for original packaging solutions isexpected to continue therefore technological innovation is likelyto impact the market considerably.
Dispatch
Beer supply chains need to be supported by efficient shippingand logistics. Batch tracking using brewery software tools enablesproduct monitoring to determine the status of all inbound andoutbound deliveries to the warehouse. Ensuring timely deliveriesand customer stock replenishment. Automation is revolutionising thebeer supply chain through automatic storage and retrieval systemsthat improve warehousing and dispatch efficiency. With the additionof brewery software, brewers can account for all materials andshipping costs to ensure products are accurately priced to maximiserevenue.
Distribution
Distribution covers a wide range of activities and a variety ofsupply chain participants. Quality auditing, marketing, training,and food pairing are all distribution activities. Participants inthe beer supply chain vary from wholesalers to retailers,restaurants, bottle stores, pubs, and clubs. Distribution andsupply are vulnerable to an unpredictable customer, andever-changing preferences. Take for example the increased demandfor beers with less calories and lower ABV that is expected to behigh in flavour and with food-pairing compatibility. The beersupply chain was adversely affected in 2020 due to the Covid-19pandemic which caused nation-wide lockdowns, the closure ofhospitality venues and restrictions on social gatherings. Thepandemic changed the way in which beer was packaged anddistributed. It generated growth in eCommerce, online demand, anddirect-to-consumer supply due to whole nations being forced to stayat home. Brewers had to rethink packaging to meet this change indemand. Twelve-packs replaced kegs, and stock meant for hospitalityvenues was redirected to retail outlets such as supermarkets andbottle shops. Covid-19 has been extremely disruptive to thedistribution and supply of beer products and this is likely tolinger. International markets will dry-up as Covid-19 outbreakscontinue to shut down countries and more virulent strains emerge.Domestic consumers will remain loyal to local brewers.
Questions:
1.1 From the case study above, construct a graphicalrepresentation of the stages of the value chain for the productionof beer. (7)
1.2 In a table format, identify the activities of the valuechain for beer production. (10)
1.3 Conduct a risk assessment of the value chain for the beerproduction. (8)