Sarah Lessor Mgt 301 1.

Darden has four major supply chains for their small ware, canned food,
fresh foods, and sea food this has some advantages to it. First, Darden
Direct Distribution one of the advantage for small ware is it cuts down on
shipping price of these small items such as plates napkins since they are
all coming from the same area. It also helps to uniform all of their
restaurant together. Giving them all the same quality small ware. Most of
Darden restaurants have another one of their restaurant right next to
them, this helps by having the same delivery path and having common
carriers. With less travel and trips it cuts down on waste the big trucks
give off and makes them more environmentally friendly. Their distribution
is passed out of Orlando, FL. Everything being in this one location makes it
easy to manage, lowers cost, and easy to inventory. They can buy
economical bulk quantities. The supply chain advantages for the canned
food are that with its eleven distribution centers it makes it inexpensive to
operate. The eleven distribution centers also makes inventory
management more effective. Darden independent supply chain is where
they get their fresh vegetables and dairy products. They purchase these
items directly from independent suppliers, which is known as B2B. This
helps make sure that the suppliers they are getting the product from is
supplying them with the freshest products. They are ensured that these
distributers know how to grow and raise these products correctly. The last
one is the seafood supply chain. This chain has Independent suppliers
from 33 different countries. Then it is Flown to the U.S. and shipped to 16
distributors at 22 locations. This is a lot of work but they get it from
overseas to ensure its the best of the best. Every
different type of seafood is being caught by an expert fisherman in that
area. This makes sure that it is reliable and the best product. Darden has
these four different supply chains to ensure quality food for their
consumer and to gain loyal and satisfied customers.
2.The complications that go into having four supply chains is it is complex,
expensive to ship, communication, and then every individual supply chain
has its own set of problems. The supply chain is very complex, because of
how large it is. It has suppliers from 35 different countries. This mean
there is a lot of driving and flying around for their products. This can
result in things becoming unusable, old, or lost. This also hurts them
economically. It is not cheap flying things overseas and all the fuel it uses
to transport things once it is in America. It has issues with communication
because it is dealing with such a large number of people and many
different languages. The small ware distribution has complications,
because if something happens at the location in Orlando, FL they do not
have another distributer to get them small ware items and will be out of
luck on purchasing new ones. The canned goods distributer is rather
problem free. The independent supply chain has problems when it comes
to making sure everything stays fresh and gets to their locations on time.
The last supply chain of seafood has cost issues. They have inspectors
that they use to make sure that all the sea food is perfect. It is very
expensive to ship this fresh food overseas as well, high transportation

costs and high legal costs. All of these supply chains can have issues with
weather, quaintly control of packaging rather the small ware could get
broken or the food not be package good enough and go bad. They also will
have to spend lots of money on tracking all the
different orders and transportation vehicles. Managing four distinct supply
chains is a demanding management task that requires specialized talents,
organization, and budgeting, and career paths.
3.Ownership/title should be expected to change in each of Dardens four
supply chains.
During the small ware supply chain, ownership will change when it is
delivered to the warehouse in Florida. With the canned food chain title
changes when it is in the restaurants hands. For fresh food, title typically
changes at delivery to the restaurant as well. Last, for the sea food supply
chain title change is most likely to be when it is delivered to the U.S. from
overseas.
4.Dardens supply chain has a very well thought
out and unique supply chains. Their supply chains differ from the
automobile industry. The automobile industry develops new and
innovative supply chains such as vendor-managed inventory, with
suppliers holding the title to major modules up until delivery to the
assembly line. The distinction between
the automobile company and Dardens
is that the often fragile nature of Darden's raw material makes four very
odd and unique supply chains an economical and fresh approach.
Darden Restaurants Case Study
October 10, 2014
Darden is a company that owns and manages several niche
restaurants and restaurant chains. These restaurants cater to different
segments of the population so that Darden is able to reach multiple
markets. Looking across the full spectrum of segmentation variables,
Darden divides the sit-down dining market based on:
Behavioral segmentation: every one of their restaurants caters to a
different occasion and provides the consumer with different benefits. Olive
Garden fulfills the need for people wanted to go to a restaurant to get
emotional nourishment, so the occasions for visiting this restaurant will
mainly be family-related and the benefit is quality family time. For Red
Lobster, the occasion and benefits relate to seeking quality seafood that is
healthy too. For LongHorn Steakhouse, the occasion and benefits of the
visit to the restaurant are to provide a relaxing atmosphere that will
remind you of a ranchers home in the West with great tasting steakhouse
style meals. Consumers behavior has changed; the market has
experienced a decline in the number of customers who are visiting
restaurants and also, the number of visits of each customer to sit-down
style restaurants.

Geographic segmentation: Dardens different restaurants are located all

across the United States; they target markets based on other
segmentation variables that are not geographic segmentation. Geographic
localization might occur where menus or communications campaigns vary
from region to region, but overall the idea is that you can also find a
restaurant from the chain wherever you go, that will adhere to the same
standards and provide you with the same experience that your local
restaurant would provide. In addition to this, in the article it is mentioned
that LongHorn Stakehouse restaurants are located primarily in the east
side of the country, which gives the chain an opportunity for westbound
expansion.
Demographic and Psychographic segmentation: by having different types
of restaurants, Darden is trying to cater to different segments of the
population. Offering alternatives like ethnic food in Bahamas Breeze,
Italian food in Olive Garden, seafood in Red Lobster and steakhouse meals
in LongHorn Steakhouse, there are plenty of options just among Dardens
chains to fulfill the customers needs, likes, lifestyles and personalities.
Taking into account their customers income, Red Lobster was created to
fill in the gap that was found between expensive restaurants and fast food
seafood chains.
As explained before, Darden restaurant chains cater to different
segments of the market. Additionally, they are also differentiated brands
that are positioned in the market as separate brands, even if the
operations of the individual restaurants are handled almost identically.
Darden has found a way to optimize the restaurants operations to
maximize results and increase revenue. This standardization and
collaboration is catered to improving the services and the lowering the
preparation times of items in the menu. They have standardized what
happens behind the counter and in the kitchen but they havent
standardized the look and feel of their restaurants, nor the type of food
each restaurant serves. As a result of this standardization, expertise in
targeting and market segmentation, and scale, each chain is able to
provide superior customer value with a competitive advantage: quality
products that cater to your wants and needs, served on a timely manner.
For example, one differentiating aspect that Olive Garden offers is that
their menu has been created as a result of a partnership with Olive
Gardens Culinary Institute of Tuscany, Italy. Red Lobsters differentiation
strategy was to expand to offer healthier menu choices that are fresh and
cooked in the grill. As a result of their differentiation strategies and their
knowledge and understanding of the of customers, they have positioned
themselves on top of their competitors and we can see this reflected in
the Darden restaurant chains performance:
Red Lobster was named the best sit-down chain in America by Mens
Health magazine.
LongHorn Steakhouses customer traffic is increasing and surpassing Olive
Garden and Red Lobsters traffic growth.

Dardens restaurants outperformed the rest of the industry during the

Great Recession.
Dardens standardization has resulted in more efficient and cost
effective operation efforts but that doesnt mean their competitors arent
concerned about catching up and surpassing Darden Restaurants
performance. Darden Restaurants is the largest full-service restaurant
operation in the world but they need to be careful about sharing their
corporate secrets and efficiency strategy because a competitor with that
information and other initiatives/ideas may gain more competitive
advantages over Darden Restaurants. Of course they are not going to
share their secrets with the competition, but sharing secrets about their
strategy with the overall scope of employees puts the company at risk.
Moreover, sharing the standardization practices with the general public
puts the company at risk of loosing clients that would prefer to bring their
business to a more localized or family-owned restaurant, instead of
bringing the business to a multi-chain nation-wide company. The
standardization practices that Darden Restaurant has put into practice can
backfire if the differentiation and positioning of each separate restaurant
chains arent carried correctly and constantly, and if the experience of
visiting any of their chains is similar to visiting another one. Lines
shouldnt be blurry when we are talking about the customers experience
at each restaurant chain; the experience at each chain should be
differentiated and aimed at their specific target market.
If Darden Restaurants continues to constantly position and
differentiate their restaurant chains while providing superior customer
value, they will continue to dominate the market. With their current goal
of increasing revenue by at least 50% in the next five years, Darden
Restaurants is trying to capture a bigger market share of customers. The
company also has the option of expanding several restaurant chains to
new geographical regions so that their growth is also extended to new
markets.
To keep themselves at the top dominating the market, and to keep
growing, Darden Restaurants chains may want to add more healthy food
to their menu, emphasizing that they care about their customers well
being and health, they appreciate the customers business and they also
want to take care of their customers like family. On another hand, Darden
Restaurants should implement a strategy for each chain to get connected
with the community through different events, like charity and aid events.
This will help the chains be connected more deeply with the customers
life and develop a corporate image that is closer to the customers heart,
thus increasing customer loyalty to their brand.

Sourcing
Approach
Achieving Darden's sustainability goals and upholding our commitment to
food safety, seafood sustainability and animal welfare depends on actions
taken at every step of the supply chain.
Highlights

Saving over 38 million miles of driving, and the accompanying gas

and emissions, during FY2012

Developing of the world's first fully integrated lobster aquaculture

park

Increasing supply of tilapia and catfish meeting "best aquaculture

practices" standard

Darden's supply chain is large and

complex. We buy about $2.5 billion in
food products from 2,000 suppliers in 35
different countries every year which
affects
the
environment,
local
economies and people's lives in myriad
ways. For example, all of the different
foods we purchase require inputs of
water,
energy
and
other
natural
resources to produce and process. The
food and other products we purchase
must also be packaged and transported
to our distribution centers and then to
more than 1,500 restaurants. Hundreds
of thousands of people's livelihoods
depend on helping produce or provide
the goods and services we buy.

Managing Supply Chain Sustainability

Over the past few years, one of Darden's key areas of focus has been to
better understand and manage sustainability issues in our supply chain
and explore how we can influence positive change. In addition, we have
established expectations for and regularly engage our suppliers on a
range of sustainability issues, from human and labor rights to animal
welfare to seafood sustainability. Our approach is to develop long-term,
mutually-beneficial relationships with our suppliers, and to work with them
constructively and cooperatively to improve their sustainability
performance when needed. We continue to explore waste reduction
through our Supplier Packaging Optimization program. By working with
our suppliers to reduce the amount of packaging, we reduce the amount
of fuel needed to transport goods while reducing the waste packaging that
can generate downstream.
Darden Direct
We have also made a significant investment in implementing a best-inclass food distribution system, called Darden Direct, which dramatically
increases the efficiency of our logistics and distribution activities. This not
only has financial benefits, but also environmental ones because it results
in fewer miles being driven on Darden's behalf resulting in less fuel
consumption and fewer emissions. Also as part of Darden Direct, we are
beginning to examine fleet fuel economy and explore alternative fuel
vehicles for transporting Darden products.

Aquaculture
In FY2012, we took a significant step toward the development of the
world's first fully integrated lobster aquaculture park when we announced
plans to build the facility in Malaysia. After several years of research and
investment in hatchery technology, we selected Malaysia as the site since
we intend to grow a species of Spiny Lobster known as panulirus
ornatus that is indigenous to the region. While we're excited about the
prospects for this initiative, it will be several years (2017) before it's
operational and even longer (2029) before production is expected to reach
scale.
By the end of FY2011, approximately 75% of the aquaculture tilapia
Darden buys was certified to the Global Aquaculture Alliance (GAA) "best
aquaculture practices" tilapia standard. Darden has already achieved
100% supplier certification for aquaculture shrimp (see Seafood
Stewardship).

Food Quality & Safety

Approach
Darden's industry-leading food safety, animal welfare and total quality
program ensures that all 320 million meals served annually meet our
stringent safety and quality standards.
Highlights

Automating traceability to improve tracking of food supply chain

Industry-leading food safety and animal welfare programs

Stricter food safety regulations for suppliers

Developed Third Party Food Safety audit process for locally-sourced

fresh produce

We serve approximately 1 million meals each day made up of 2,000+

different ingredients and there is no single issue more important to
Darden than food safety. We have an international team of more than 50
biologists, food scientists and public health professionals dedicated to
implementing and continually improving our industry-leading food
safety/total quality program.

Food Safety
In Darden's view, the best way to ensure the
safety of the food we purchase is to go directly
to the source as well as to multiple points across
the supply chain. Our objective is to have
traceability from "pond to plate" or from "farm
to fork." We use a risk-based, Hazard Analysis of
Critical Control Points (HACCP) approach which
provides the highest level of security across all
levels of the supply chain. We employ field plant
inspectors in the U.S. and abroad who inspect
food plants, processes and products to verify
they meet our standards before they are
shipped. We also have 18 total quality managers
in the field who, as registered sanitarians,
review and certify in-restaurant food processes
to ensure the integrity of the system all the way
through to when the meal is delivered to the
guest.

Traceability
Darden is transitioning our entire supplier base to Global Food Safety
Initiative (GFSI) Third Party Audits. While we have long conducted food
safety audits of our suppliers utilizing Darden TQ personnel and Third
Party auditors, our objective is to harmonize the process, ensuring that we
are applying the same, internationally recognized food safety standards
across our global supply chain. GS1 barcodes have been used on
packaged goods for decades, but have only recently begun being used for
fresh food products.
Animal Welfare
Darden believes that ensuring the welfare of animals in the food supply
chain is both an ethical issue and an important aspect of food safety.
Darden has a set of Food Animal Welfare Principles and Policies and
suppliers are required to certify their animal welfare practices, which are
confirmed through third-party audits. Darden regularly reviews our
principles and policies as new science and information becomes available
and, in FY2013, we updated them to more clearly outline our supplier
audit process.

Seafood Stewardship
Approach
We have a vested interest in seafood stewardship to ensure that the
supply of seafood remains available, affordable and meets the quality and
safety standards we expect.
Highlights

Launching the Honduras Spiny Lobster Fishery Improvement Project

Promoting more of the GAA "best aquaculture practices" standards

Fisheries
In FY2011, Darden announced a commitment to rebuilding troubled
fisheries through three targeted Fishery Improvement Projects. The
commitment is part of Darden's membership in the Clinton Global
Initiative (CGI) and was recognized by CGI as an exemplary approach to
addressing environmental challenges. The initial FIP was launched in
partnership with Publix Super Markets and Sustainable Fisheries
Partnership in the U.S. Gulf of Mexico. The focus is to support the
rebuilding of commercial reef fish fisheries, primarily grouper and red
snapper, using several tools including the development of data collection
methods to enhance management, testing different gear types to reduce
interactions with sea turtles, and building new markets for the fish as
populations recover. In FY2013, Darden announced its second FIP
commitment, this one involving the Honduras Spiny Lobster Fishery. We
are collaborating on this effort with the National Fish and Wildlife
Foundation and the Walton Family Foundation, creating a Fishery
Improvement Fund for Honduras and beyond.
In FY2009, Darden helped launch the Atlantic Lobster Sustainability
Foundation, a nonprofit organization that works with fisherman,
processors, buyers, government agencies and other stakeholders to
preserve and enhance a viable, strong and sustainable lobster industry.
Darden provided $200,000 in seed money, and continues to play an active
role in the organization. (seewww.lobstersustainability.ca)
Aquaculture

We are continuing to work with our

aquaculture suppliers to help them
implement the GAA "best aquaculture
practices" standards. Darden regularly
evaluates our purchasing practices to
ensure they support and encourage
sustainable fisheries. In partnership
with the New England Aquarium, we
maintain and regularly update a list of
wild harvest species that we do not buy
due to overfishing or mismanagement.
We have also committed to require that
all aquaculture species be certified to
Global Aquaculture Alliance (GAA)
standards, as they become available.
By FY2013, we were working with our
suppliers to implement GAA standards
for four species, including catfish and
salmon.

Health and Wellness

Approach
Darden's Health and Wellness commitments are an exciting response to
our guests increasing interest in healthy eating.

Highlights
Reducing our calorie and sodium footprint and enhancing the nutrition of
our children's menus
Providing a growing number of lower calorie dining options
Increasing availability of nutritional information online and in restaurants
One of Darden's core strengths is our ability to continually evolve to meet
the consumer's ever-changing needs. When it comes to health and
wellness, we know our guests are increasingly interested in healthy
dining. We believe that responding to this growing demand will help us
strengthen our relationship with our current guests, while expanding our
appeal to a broader base of future guests.
Darden's approach to health and wellness is guided by three core
principles:
Transparency:
Ensuring guests have easy access to the menu information they want
Choice and
Variety:
Providing options on all of our menus to suit individual tastes and dietary
needs
Innovation and
Collaboration:
Creatively identifying new and different ways to support guests' individual
health and wellness goals
Partnership for a Healthier America
Darden has made the most comprehensive
health and wellness commitment in the
restaurant industry to date. Working with the
Partnership for a Healthier America, in 2011
Darden has pledged to reduce our overall
calorie and sodium footprint by 10% by 2016
and by 20% by 2021.
We are making progress on our calorie and
sodium goals and, in FY2013, Darden released
new childrens menus that are compliant with our promise - including
offering 1% milk as the default beverage, a fruit or a vegetable as the
default side and prominently promoting at least one item that meets
defined nutrition criteria. We have also made significant investments to
enhance our nutrition analysis capabilities. These new capabilities help us
to make nutritional considerations a more integral part of recipe
development, in the same way taste, quality and cost have always been.
This new approach has proven critical to helping us develop lighter dishes
on many of our menus.
Offering Guest Options

Darden's brands are offering our guests

increasing
options
through
lighter-fare
selections. Seasons 52 is a pioneer in this
approach and today, almost all Darden
brands offer lighter fare selections. As
consumers diets continue to evolve, Darden
is providing options, including vegetarian, gluten-free and many others.
The goal is to continue to provide an atmosphere where guests can be
nourished while meeting their goals.
Online Availability
In addition to providing our nutritional
information on all of our casual dining
restaurant websites, in FY2010 Darden joined
HealthyDiningFinder.com, an online resource
center that provides consumers with "dietitianapproved" menu options, to extend the online
availability of our nutritional information.