Higher Technological Institute of Xalapa

industrial engineering

Logistics and Supply Chain

Company:
Coffee the sound of my land

Project:
Improvement in logistics and supply chain

Professor: Sandoval Erizo Mayerlin

Members:
Cristóbal Ramírez Sebastian
Zarate Lozano Ivonne

Xalapa, Ver. June 14, 2019

 Index
Introduction..............................................................................................................................................2
Justification..............................................................................................................................................3
Goals..........................................................................................................................................................3
General objective.................................................................................................................................4
Specific objectives..............................................................................................................................4
Theoretical framework...........................................................................................................................4
Product....................................................................................................................................................13
Direct materials..................................................................................................................................14
Indirect materials...............................................................................................................................14
Suppliers and selection criteria.........................................................................................................14
Customers...............................................................................................................................................14
Product process diagram....................................................................................................................15
Describe the process with machines...............................................................................................15
Company logistics, transportation, route.......................................................................................19
Supply chain diagram..........................................................................................................................20
Flowchart.................................................................................................................................................20
lay out.......................................................................................................................................................21
Every time they deliver to customers...............................................................................................22
Conclusions............................................................................................................................................23
Bibliographies........................................................................................................................................23

p. 2
Introduction

This research provides a comprehensive vision of the coffee agroindustry in Mexico,

characterizing the functionality and relationship of the links in the supply and value
chains of this production process, highlighting the competitive advantage and added
value of each of the stages. of the production process. The scope defined in the project
covers the cultivation, production process of the coffee bean, marketing and production
of coffee derivatives, which is why the investigative work focuses on 3 fundamental links
that will be seen in the development of the document. The characterization proposed in
this document is defined as the identification of all the factors and distinctive features
that intervene in a process and that must be controlled. This allows recognizing the
relationship with other internal or external processes, the inputs and outputs of the
process, suppliers and customers, making it easier for system users to know in a clear
and simple way the actions of the company and the management of its processes;
Likewise, facilitate future processes that help the competitiveness and sustainability of
the sector, which is for the state of Veracruz one of its strategic pillars of development of
the country.

Justification

The improvement of the supply chain arises from the need to assign a risk estimate to
each of its activities in terms of the most significant threats, where the most substantial
period of the procedure is undertaken, namely, that is, the justification of investing in the
model for the following:

 Establish and approve alternative suppliers.

 Invest capital in factory or supplies in critical condition.
 Maintain adequate levels of vital capital.

p. 3
Goals

General objective
Carry out the characterization of the value chain and the supply chain for the company
“Café Son de mi Tierra” in Cerrillos, Alto Lucero, Veracruz. Identifying the factors that
influence the grain harvest, processing, production and distribution of coffee.

Specific objectives
• Analyze the current processes of the supply chain of “coffee are from my land”
Cerrillos, Alto Lucero, Veracruz

• Identify the appropriate model to improve the supply chain in the company “Café son
de mi Tierra”, Cerrillos, Alto Lucero, Veracruz

Theoretical framework

Definition of supply chain

Ballou (2004) is a set of activities such as warehouse, transportation, etc., that are
repeated in the flow channel, where the raw material is transformed into a finished
product and value is added for the customer.

Terrado (2007) is a network of facilities and distribution means whose function is to

obtain materials, transform them into intermediate products and finished products and
distribute them to consumers. Components such as globalization have shown a
significant example in the progress and advancement of the study and assessment of
the supply chain, since companies are increasingly required to establish precise
relationships with their suppliers, especially if it is clear that The costs resulting from a
bad connection can be considerably expensive.

Chopra & Meindl (2008) the supply chain is all those parties that are involved either
directly or indirectly in the fulfillment of the customer's order. The supply chain not only
includes manufacturers and suppliers, but also transporters, sellers, warehousers and
even the customers themselves.

p. 4
Parts of the supply chain

Terrado (2007) the supply chain consists of three parts: supply, manufacturing and
distribution.

 The supply part is specified in how, where and when the raw materials for
manufacturing are obtained and supplied.
 Manufacturing converts these materials into finished products.
 Distribution ensures that these final products reach the consumer through a
network of distributors, warehouses and retailers.

The chain begins with your suppliers' suppliers and ends with your clients' customers.

Carretero & Pires (2007) there are four basic processes for the three parts of the supply
chain, being: plan, supply, make and deliver.

Importance of the supply chain

Fontalvo & Carmona (2011) the importance of the supply chain lies in the adequate and
efficient flow of products and the good management of information for decision making
and the development of plans for the company. If one of the participants in the chain
fails, it would cause trauma in subsequent processes and consequently in the entire
network.

Chopra & Meindl (2008) the main or relevant aspect of the supply chain is based on the
need to make good decisions, its design, planning and operation. Companies need to
give greater importance to strategic levels in the supply chain.

Supply chain object

Tella & López (2005) the objective of a supply chain is to plan and coordinate all
activities in the chain that increase customer satisfaction levels, while keeping costs low.
It is also one of the processes that intervene directly in organizational operations and is
characterized by being fast, flexible and organized, it is the key to success and
achievement of competent and sustainable advantages.

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Ramírez & Peña (2011) the object and reason of the supply chain is to manage the
operational dimensions and organizational components that specify speed, adaptation
and training, facilitating managers and scholars of the subject, the evaluation of the
stages of the supply chain. same as regards these criteria, as well as the impulse to
investigate factors that prescribe an impact on profit.

Supply chain criteria

Arana, Alfalla, & Machuca (2012) the supply chain comprises three criteria, the following
being:

to. Agility

The concept of agility encompasses three components that define this criterion:

1) A light short-term medium.

2) Changes in demand and supply.
3) Quick response period.

Agility marks speed as a substantial characteristic within the chain. This could be
manifested by the growth of global competition, which establishes a framework to
compete.

b. Adaptability

The adaptability criterion is synonymous with potential in production because it responds

to constant changes in the business environment. Consequently, it is known that a
specific analysis regarding variables that manage the competitiveness of the company
has not been concluded.

Adaptability plays a very important role in the supply chain, since it meets the ability to
carry out different methods and use different skills to achieve goals. Furthermore, this
indicator is flexible, allowing the first component to develop more quickly, managing
each element structured in the chain.

c. Alignment

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When areas and departments are aligned, it is not only due to the demands of potential
clients, but also due to the pressure to remain competitive, since there are many
companies that have a global outlook, constantly innovating and aligning their areas with
the aim of define new patterns that predict a better future in the company.

Supply chain management

Capó, Expósito & Tomás (2007) the supply chain is a management system that creates
and controls the supply chain itself. A system that can contemplate and manage all the
elements of the chain, ensuring that these elements can be involved. The objective is to
seek common benefit and avoid working individually like classic supply chains. If these
premises are met, it will be the feasible start for the application of models.

Rey (2005) to optimally manage the flow of information in the supply chain, the
application of 5S is essential, which is a management technique from Japan, focused
on: Seiri “organize”, Seiton “order”, Seiso “ clean”, Seiketsu “maintain cleanliness” and
Shitsuke “discipline”. Well, this is about avoiding superfluous movements in the flow of
the supply chain and transforming the production team, leading it to an ideal state.

Supply chain activities

Ballou (2004) the activities that involve the operational process of the supply chain play
an important role in the business world, although it is true, every activity or operation of
an organization is related to other activities, if a single activity If it fails, it will possibly be
reflected in all other activities and as a consequence, there will be organizational
burnout. It is convenient to carry out an optimal study regarding the supply chain in order
to avoid subsequent costs and risks at the business level.

Chopra & Meindl (2008) supply chain activities include capacity planning, production,
promotions and purchasing. In relation to activities, an information system must be
available, since functions can be affected by the effects of planning processes. It is of
interest that all these activities are also integrated into the preparation of forecasts.

Coffee

p. 7
- Coffee is native to the African continent, Sudan and Ethiopia. - The typical variety was
brought from the Paris greenhouse to Cayenne in 1706. - It arrived in Peru and
developed commercially in the Chanchamayo Valley, starting in 1876.

Parchment coffee is dry coffee that has gone through a process until it has 12%
humidity.

Remy & Glave (2007) coffee associations must consider the integration of processes
and people, maintaining them over time, with the sole objective of promoting the
sustainable development of SMEs. The success of organizations will depend greatly on
the work environment and teamwork factor.

Coffee varieties

Peruvian Chamber of Coffee and Cocoa (sf) most varieties grow in the wild in the
intertropical zones of Africa, Insulindia, Malaysia, Mascarene Islands, etc., but they do
not present the greatest interest. Only ten species of Coffea are cultivated in the world.
In order of economic importance they are:

 Arabica coffee.
 Coffea canephora.
 Coffea liberica.
 Coffea dewevrei.
 Coffea stenophylla.
 Coffea congensis.
 Coffea abeokutae.
 Coffea klainii.
 Coffea zanguebariae.
 Coffea racemosa.

Of these ten species, the first three are the most widespread. Arabica is, without a
doubt, the most cultivated (90%) and the most appreciated of all.

Most cultivated coffee varieties in the world market

p. 8
Infocafés (2006) in the international green coffee market, the following market types are
distinguished:

- The conventional

The conventional type is the one that is governed by the New York Stock Exchange,
with Arabica coffee having a 70% share of the total market in the world. This type of
coffee comes from high coffee-growing areas and has a high degree of cup quality, due
to its acidity, and reaches very high prices in the coffee market. Also, on the London
Stock Exchange, the coffee with the greatest participation is the robusto coffee of the
canephora species, which has 30% of the market. This coffee has a high yield, but has a
weak quality in the cup.

- Specialty coffees

Its trade is distinguished because prices are set based on quality, certification of
production processes in harmony with the environment and social work of producer
organizations.

- The “Caturra” variety (red and yellow)

Also known as red or yellow, they are mutants of the “Bourbón” coffee variety
propagated in Brazil and introduced to Peru through the Tingo María Experimental
Station in 1950. They are dwarf in size and stand out for their high productivity, requiring
constant fertilization and productive pruning. The grain size compared to Typica is
relatively small. In the red mutant of Caturra the fruits acquire a wine red color at
maturity, while in the yellow mutant, a yellow color. The latter has shown somewhat
more productivity, although less retention of ripe fruits in relation to the “Red Caturra”.

- The “Pache” variety

It is native to Guatemala and introduced to Peru by the Beltsville Plant Introduction

Center, State of Maryland, United States of North America in 1950. It is a variety similar
in size to the Caturras, rustic, with high productivity and the grain size very similar to that
of the Typica. Its yields per plant are favored by constant fertilization.

p. 9
- The “Catimor” variety

It is a hybrid that originates from the crossing of “Caturra Roja” and a hybrid of “Timor”, it
comes from the Tropical Agricultural Research and Teaching Center of Turrialba in
Costa Rica and was introduced in Peru in 1983. It has relatively

high productivity in areas subject to intensive coffee growing activity, with large amounts
of fertilizers and is resistant to rust.

coffee market

Remy & Glave (2007) coffee is the main agricultural export product in Peru. It is a
permanent crop that is developed throughout the eastern slope of the Andes and only in
the department of Piura on the western slope. The production areas, mainly high jungle,
are rugged, with steep slopes between 800 meters above sea level and 1,900 meters
above sea level.

Ministry of Agriculture (2002) coffee is produced in 338 districts, 47 provinces, 12

regions of the 24 existing in the country. It is essential to be able to study the available
resource to effectively and efficiently distribute the final product, in order to corner the
markets and propose competitive strategies that improve parchment coffee exports.

Supply chains as a system

Supply chains (SC) or sourcing are described as the interconnected resources and
activities necessary to create and deliver products and services to customers, therefore
they extend from the point where natural resources are extracted to the consumer [2]. .
In the food industry, CS are complex, continually changing systems that involve many
participants [3], including suppliers, producers, distributors, wholesalers and retailers,
regulatory entities, consumers and others. This characteristic of the SC makes them
behave as a multidisciplinary organism, which seeks to satisfy the demands of the End
customer through the effective coordination of the flows of information, products and
Financial resources that travel through it, from the supplier's supplier to the client's client
[4]. This coordination is effective if the information is known and managed, that is, the

p. 10
flows of materials and services that can be considered as a system [5] of elements that
share information to meet an objective.

When considering CS as a system, it is necessary to remember Bertalanffy and his

general systems theory, which emerged in 1950, in which it is argued that the whole of a
system is more than its parts, due to the existence of dependencies between its
elements. . This aspect is critical in CSAs, not only because it is made up of various
actors, such as people, structures and technologies, [6], among others, but because of
the importance of the relationships between them. The ability to manage relationships
(or alliances) between actors determines the quality of the product [7]. And it is there
where the system concept takes shape in the CSA, requiring the sum of the elements to
create and deliver products in accordance with the requirements of the demand. A
relevant aspect for harmony in a system is the fidelity of the information, which requires
formal platforms or structures that manage to maintain this integrity. The
conceptualization of these structures can be achieved through models that allow us to
represent a specific situation and, from there, propose practices that improve its
management. One form of representation for the case of CS is the SCOR operations
reference model, which analyzes business processes, metrics, best practices and
technological characteristics to support information management between CS actors
and, therefore, In this way, improve its effectiveness [8].

For the agri-food sector, these process reference models have been important since the
appearance of software architecture, as they have allowed the sector to be evaluated
from different branches of agriculture, including fruit production. However, there is no
active example of a process reference model for Fruit supply chains [9], which means
that there is great room to deepen this knowledge, especially in analyzing the chains
from a perspective broader and less operational.

Factors affecting supply chain modeling

There are various factors that affect the modeling and management of CSAs, one of
them is the territory (or location), which determines the quality of the products and

p. 11
generates, or not, competitive advantages. This situation has forced not only operational
aspects but also social and cultural aspects to be incorporated into the studies, which
lead to a comprehensive approach to the management of SCs. In this sense, the
integration of the territory through productive chains as a competitive strategy is
associated with the generation of new forms of production, which go beyond the free
competition market and which exert a strong influence on companies and localities [10],
from various dimensions according to the context.

The analysis of these integration initiatives shows that social harmony and coordination
are basic elements for the competitiveness of these chains in the long term and, in
particular, the importance of collaboration and competition to generate innovations [11]
or new ways of responding to the market, particularly the food market, which
increasingly uses differentiation strategies in products [12], [13], which implies a greater
effort in terms of productivity, quality, marketing, etc., but in the future, better conditions
for all members of the CS. In CSAs, not only innovation plays an important role, but also
compliance with private standards, a situation that has become a form of competitive
advantage for leading companies that use certain characteristics (organic, fair trade) to
differentiate products [ 14].

In this sense, the integration of CSA requires knowing the environment and the best
ways to design and manage information [13], which is fed by the organizations
responsible for providing, producing, distributing, processing and marketing agricultural
products to final consumers. .

However, the management of CSAs differs from that of other supply chains, due to the
importance of factors such as climate variability; The quality of products; food security
[15]; the management of perishable products and life cycles [16]; the variability of
demand and prices [13]; the availability of workers; crop yield; labor costs and those
associated with the collection of products [17]; volume, location and seasonality [18]; the
use of efficient means of transportation that provide a balance between time to market
and cost; post-harvest management of crops; the degree of maturity of the product; the
maximum time for delivery; the availability of the products; transportation time and

p. 12
delivery costs [19]; characteristics such as freshness and safety of products; the
percentages for losses due to perfectibility [20]; the distance that the product must travel
to reach the consumer (food miles), which determines the economic, social and
environmental impact [21]; the presence of natural phenomena; reforms to the laws of
the sector; free trade agreements; devaluation processes; the application of new
Phytosanitary standards for marketing [11], [14], traceability or localization and
monitoring of the product's trajectory [7]; the quality of the Packaging and Branding
system; efficient logistics for procurement; the high added value with lower operating
costs [25]; the constant price changes due to excess or shortage of products, among
others.

Product

The first image was one of the first bags in which the ground coffee was bagged for
sale. It was something basic, a proposal for improvement that was provided to the
company with a design in the shape of 1kg bags for a better presentation and more
striking for clients, consumers and we hope that it has a good impact on the market and
increases demand.

p. 13
Direct materials
 coffee cherries

Indirect materials
 pulping machine
 hulling machine
 cleaning machine
 grain separation machine
 Roasting and drying machine
 grinding machine

Suppliers and selection criteria

The coffee company is from my land, they themselves are its suppliers since the two
partners and owners of the company have hectares of coffee crops that are located in
the same community of Cerrillo de Díaz Veracruz, they are the ones that provide the
material. cousin.

Customers

The clients that are supplied with our coffee product are in the following cities,
communities in the different stands, institutions and food stands are:

Mexico: Hotel Yillow

Xalapa: Institutions such as INE, SEDESOL, schools and some breakfast

establishments.

Alto Lucero: Local town shops and restaurants.

Cerrillo de Díaz: In the same place where they process the coffee, local shops in the
town are also sold.

Our best in the part of our clients that the company has, since it is a new company in the
market it is barely becoming known in other cities, the best thing is to make our coffee
known, present it in different stalls. food, stores whether small or large, in the different
states, cities, towns to have more customers and grow the company, its demand, etc.

p. 14
Product process diagram

Describe the process with machines

p. 15
Pulping: the pulping machine consists of one or several discs with a diameter of 45cm,
assembled around an axis that rotates horizontally. The cherries are placed on either
side of the discs. The rough sides of the discs move the cherries and the cherries are
squeezed between the pulper bars and the discs. A separator plate separates the pulp
from the coffee beans. The pulper bar and the separator plate can both be adjusted
according to the size of the cherries to avoid leaving unpulped cherries and to avoid
damaging the grain.

Hulling: Coffee hulling is removing the parchment skin (also called "parchment") from
the coffee bean.

Parchment is a naturally occurring papery substance that surrounds the coffee bean,
much like the endocarp (membrane-like layer) that surrounds many other types of fruit
seeds (such as apple seeds). Rubbing the parchment is optional because some coffee
beans are sold "in parchment" (or "in parchment").

The time it takes is very short, approximately 5 minutes for the process.

p. 16
Cleaning: a very important moment arrives, that of washing. It is in this instance that the
remains of fruit that may have been impregnated into the grain are removed. And sugars
are also eliminated, resulting in something closer to what you will drink later.

The cleaning time it takes in the machine is somewhat quick, about 5 to 10 minutes for
good purification.

Bean separation: When supplying coffee beans to the machine, the finex separator is a
very effective machine when it comes to separating coffee beans, providing capacities of
up to 3.5 tons/hour. It is important that broken beans are removed to ensure that a
product of constant and high quality is achieved. This operation takes a few minutes,
about 5 minutes.

p. 17
Roasting: the coffee is roasted in a rotating drum of a machine called a roaster, through
which very hot air circulates, reaching maximum temperatures close to 200ºC. Roasting
time is approximately 15-20 minutes.

In conventional roasters, the coffee beans are roasted by direct contact against the walls
of the drum, which is heated by a flame and passed through by hot air. The heat
transmission is not homogeneous and the beans easily burn on the outside, leaving little
roasted on the inside, although this also depends on the quality of the coffee roasters. In
this case, the temperature and time are more complicated to adjust than to regulate.

Coffee grinding: The grinder is the main tool for producing small, exact, uniform
quantities of coffee. There are different types of mills that can be found and they vary in

p. 18
their characteristics, therefore, it is important to check which direction your mill has and
which one will make the grind finer and which other will make it coarser. Grinding the
already roasted coffee beans is very quick in just a few minutes.

There are also factors that can influence your grind, such as humidity/moisture in the air,
for this you will need to make some readjustments to your grinding routine so that these
changes do not interfere.

Company logistics, transportation, route.

Since the same company is the distributor of the same raw material, the transportation
of moving the coffee beans is done using trucks until they reach the company, where the

p. 19
aforementioned coffee process begins to obtain the finished product, which is the bags
of coffee. one kilo coffee for distribution, since the company does not have many
resources, it takes an amount only necessary for customers, and its distribution is done
using closed vans for transportation.

The routes that are currently handled in the distribution are to Mexico City, Xalapa, Alto
Lucero and the same municipality of Cerrillo de Días, and will soon reach more
destinations in different parts of the republic.

Supply chain diagram

Flowchart

p. 20
lay out

p. 21
Every time they deliver to customers

p. 22
It is supplied to the customer when they require more, since it can vary in some places,
in restaurants in one or up to two weeks they require our coffee, since in stores it can
take more than a month depending on whether the population consumes it.

Conclusions

CS can generate more sustainable processes and more efficient results if it is

considered as a set of elements that relate to each other, in a coordinated and orderly
manner, that manages information at all levels (suppliers, producers, distributors,
wholesalers and retailers. , regulatory entities, consumers, etc.), and whose purpose is
to meet customer expectations, without losing value.

It is common for SCs to be demand-driven, which is why emphasis is placed on

controlling or predicting market dynamics, to deliver products according to their
requirements. However, in the case of some CSAs of perishable, seasonal products and
with low production volumes, it is complex to establish a reference model towards
demand, specifically in time and volume requirements, which forces the market to
consume at specific times. of abundance, and the SC to adapt to the conditions of both
production and its variability, as well as the need for demand.

CSA planning requires the design of management models that can broadly identify the
dynamics of the territory, taking into account aspects such as the size of farmers,
primary production conditions, technology, market demand, financial capacity and
management practices, among others, which implies the development of designs that
adapt to the specific conditions of the territory, a process that is currently facilitated
thanks to stochastic models that allow a broader group of variables to be managed.

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