A system study on the concentrate operations of ARC Refreshments Corporation

• Main Author: de la Cruz, Angelica Pauline
• Format: text
• Language: English
• Published: Animo Repository 2017
• Subjects: Beverage industry—Production control; Root cause analysis; Drink concentrates; Operations Research, Systems Engineering and Industrial Engineering
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/18651
• Institution: De La Salle University

The study focuses on the Concentrate Operations of ARC Refreshments Corporation. This system repackages the measured premix and distributes it to the different manufacturing plants of the company in the Philippines, which acts as the customers of the system. The premixes, which are repackaged in terms of units, are the raw materials needed to create the syrup used in the production of carbonated drinks. These premixes are composed of two: dry ingredients and concentrates. Based on the findings of this study, the system experiences a loss if dry ingredients. More dry ingredients are withdrawn than what is needed by the system. During 2015, the Concentrate Operations yielded a total of 4,581.6 kilograms loss of dry ingredients equivalent to a total of PHP1,705,882.63. Loss of dry ingredients were divided into two main branches of the why-why diagram: losses in the warehouse (76.21%) and losses in the repackaging process (23.79%). For losses in the warehouse, it is contributed by the expiration of sacks and damages to sack packaging while in storage. On the other hand, losses in the repackaging process were contributed by withdrawal damages and spillage of dry ingredients. To address these issues, the researchers of the study designed a Storage and Withdrawal Technique that lets workers of the system comply with the First in First Out policy of the company. Aside from this, a layered rack, automatic sealer, and filtering mechanism was added in the system to eliminate losses contributed by dry ingredient spillage in between the weighing and sealing process. Through the solutions generated, the opportunity cost was eliminated because losses are prevented in both warehouse and repackaging process. This will greatly impact the company's overall performance as the Concentrate Operations act as the start of their supply chain.