Peloton’s Supply Chain Can’t Peddle Fast Enough

Peloton’s Supply Chain Can’t Peddle Fast Enough

February 11, 2021

Delivery delays for Peloton’s exercise bikes have threatened the company’s market leader position.

Since the lockdown in March 2020 due to the pandemic, demand for Peloton’s exercise bikes and treadmills has surged.  However, with the shipping delays at ports from overseas manufacturers, Pelton is struggling to make timely deliveries, amidst order cancellations and requests for refunds.


Video Spotlight: Peloton tops earnings expectations, warns of supply issues due to uptick in sales amid coronavirus (Nov 6, 2020, Yahoo Finance)


This post is based on New York Post article, Peloton customers are canceling their orders after months-long waits, by Nicolas Vega, November 24, 2020; the Freight Waves article, COVID broke Peloton’s supply chain – can $100M fix it?, by Brian Straight, February 6, 2021; and the YouTube video in the Spotlight. Image source: SolStock/Getty Images

Discussion Questions:

1. Comment on the importance of accurate forecasting for Peloton’s supply chain.

Guidance: Peloton’s inability to accurately predict shipping delays from overseas manufacturers has caused product shortages that lead to missed deliveries and poor customer service.

2.  How are Peloton’s supplier sourcing policies relevant to the current shortage?

Guidance: Peloton sourced its bikes and Continue reading

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Forecasting Halloween During a Pandemic

Forecasting Halloween During a Pandemic

September 20, 2020

Tricky forecasting leaves chocolate companies wondering how candy sales will fare this Halloween.

Mars’ time horizon for planning for the Halloween season spans two years, yet no one could have known how different things would be this year because the pandemic.  For Hershey, Halloween spending comprises ten percent of annual sales.

No one is sure right now if “self-consumption,” when people buy Halloween candy to eat themselves rather than to distribute to others, will be enough to fill the gap of sales lost from trick-or-treating.


Video Spotlight: 


This post is based on the Fortune article reposted to Yahoo Finance, How scary will a COVID-19 Halloween be for candy companies?, by Beth Kowitt, August 29, 2020, and the YouTube video in the Spotlight. Image source: Shutterstock / Sandy Morelli

Discussion Questions:

1.   What role does aggregate planning play in the current availability of candy for Halloween of 2020?

Guidance: Many companies have a long planning horizon.  In part this may be to ensure adequate supplies of materials and resources when it comes time to manufacture product to meet demand. In addition, manufacturers need to Continue reading

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Wholesalers Reducing SKUs

Wholesalers Reducing SKUs

August 12, 2020

During the pandemic, many supply chains have been stressed with rapidly changing demand and disruptions in supply.

One way to reduce this stress is to simplify operations.  The supply chain can function better with fewer SKUs (Stock Keeping Units).  This allows supply chains to focus on fewer, more important items, which helps offset some of the additional problems added by the pandemic.

Many organizations are reducing their SKUs, including Kraft Heinz, Coca-Cola, and Hershey.  Coca-Cola has a goal of reducing SKUs by 25%, and has established a mechanism to identify SKUs to be eliminated.

To give you an idea of the complexity of the supply chain, the average grocery store stocks 33,000 SKUs; a Walmart Supercenter will carry around 120,000 items.  Over the years, the number of SKUs has tended to increase.

Offering a greater variety of SKUs provides the customer with a greater selection of items.  This works well when customers are taking their time shopping for items.  During the pandemic, however, many customers are trying to reduce their time in the store to avoid potential exposure to the coronavirus.  Reducing the number of variations of products allows customers to more easily Continue reading

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