Supply Chain Failure: KFC’s Chicken Shortage

Supply Chain Failure: KFC’s Chicken Shortage

March 19, 2018

It seems hard to imagine that KFC would run out of chicken.  That’s their main menu item! How can they operate without chicken?

Turns out, they can’t. The majority of KFC’s UK restaurants were forced to close due to a chicken shortage.  Approximately 650 of the 900 KFCs closed in February 2018, while many of those that remained open, operated with a reduced menu.

The origins of the shortage: KFC decided to switch suppliers from Bidvest to DHL and QSL (a food distributor) in October 2017. They promised to “revolutionize the UK foodservice distribution market.”  Part of the promise included reducing logistics emissions to net zero over the life of the contract.

The change in distributors affected Bidvest and DHL.  Bidvest laid off 255 employees after it lost the contract, while DHL and QSL opened a new distribution center, and hired approximately 300 new employees.

Although improved performance was promised, not everyone saw such a rosy future.  GMB, the UK trade union for the displaced Bidvest employees, warned KFC of potential problems with the switch to DHL.  Mick Rix, the GMB’s national officer said:

“We warned them a few months Continue reading

What the Cluck Happened to KFC?

What the Cluck Happened to KFC?

March 5, 2018

UPDATE 3/5/18: The good news is that 97% of UK restaurants are restocked with chicken. The bad? KFC ran into another shortage, this time of gravy.

Original post:

In the UK, about 800 of the 900 KFC locations were closed on Monday, February 19th, 2018 due to a shortage of chicken.

How could KFC be out of chicken?

Supply chain operations are normally taken for granted, until something fails.  And fail they did.

A combination of events led to the chicken shortage. At the front of the line is KFC’s switch of their logistics partner from Bidvest to DHL.  Delivering fresh chicken to over 900 restaurants is not an easy task, as DHL found out.

KFC’s former logistics, Bidvest, is a food distributor.  DHL, known for success and innovation in the logistics field, is learning how to be a food distributor.

Add in that Bidvest had a network of six distribution centers to DHL’s one new center.  A combinations of traffic accidents around the one center, new employees at the new center, a facility that wasn’t registered for food, IT failures, and other problems led to KFC’s chicken shortage.

It may have been Continue reading

Hospitals Work Around IV Bag Shortage

Hospitals Work Around IV Bag Shortage

January 26, 2018

A shortage of IV bag has limited the ability of hospitals nationwide to deliver IV-administered drugs to patients.

The IV bag shortage results from a disruption of IV bag production at Puerto Rican plants, after the hurricane cut the power supply.  The shortage has hospitals scrambling to find alternatives and workarounds to handle an influx of patients during the flu season.

This post is based on the USA Today article, Hospitals find other ways to deliver medicine amid IV bag shortage, by Anne Saker and Shari Rudavsky, January 14, 2018.

Discussion Questions
1. How does the IV bag shortage affect health services?

Guidance: Issues include inability to provide patients with the IV-administered drugs, devise less effective and efficient alternatives and workarounds, stop elective procedures

2. What are healthcare providers’ responses to the IV bag shortage issue?

Guidance: They’re finding secondary suppliers where possible, rescheduling patients, and finding ways to permanently reduce the use of IV bags.

3. In what ways can the IV bag shortage issue be better understood from a supply chain management perspective?

Guidance: Supply chain disruption and risk mitigation is of particular importance to the health care industry; alternative means to provide Continue reading