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Lumi Juice: From Concept to Store- Part II

Read the real-life case study to further understand and apply how to identify and prioritize risks.
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© Copyright 2015 by the University of Virginia Darden School Foundation

During week 3 we are going to revisit the Lumi Juice example in order to examine and understand identifying, prioritizing, and planning for risks. You were provided important background information and context for the case study in the previous section. Now, we are going to understand the project “From Concept to Store.” To review Exhibits 1 and 2, please download the full case study article PDF attachment below under “Downloads” called Lumi Juice Case Study.

On June 28, 2013, Lewis set out to make her dream a reality. She began by laying out the scope of the project and identifying the key activities required to put a product on the shelves of a major retailer. Activities were grouped into the following categories: (1) facility identification, outfitting, and equipment preparation, (2) process design, (3) finances, (4) information technology, (5) HACCP training and certification,10 (6) packaging (labels, bottles, and closures), (7) developing liquid recipes (8) human resources, (9) marketing and sales, and (10) produce sourcing. See Exhibit 1 for a high-level work breakdown structure. See Exhibit 2 for a detailed work breakdown structure.

The facility activities would involve scouting a location, signing the lease, and preparing the facility for manufacturing, including setting up all the necessary utilities (electrics, water, Internet, and compressed air for the HPP machine) and ordering all the equipment (the HPP machine, cold storage, juicers, batch tanks, fillers, cappers and labelers, fork lift, drying racks, and soaking bins). Activities associated with the process design would include researching the design and finalizing the process. Finance activities would include securing a lease on the HPP machine and insurance for the plant and equipment. Information technology would involve setting up financial software.

Where HACCP certification was concerned, a consultant would need to be hired, Lewis herself would need to be trained and certified, and finally Lumi would need to file for approval from both the Virginia Department of Agriculture and the Food and Drug Administration (FDA).

The packaging tasks would revolve around designing, finalizing, and ordering labels; ordering bottles and closures; and identifying any secondary packaging required for shipping. The liquid step involved defining a product line of delicious juices, including nutritional content, drink names, and narratives. In terms of HR, Lewis knew she would need to hire a production crew and an operations manager. Marketing and sales would require her to estimate demand and, following an analysis of the costs, determine a sale price. Finally, produce sourcing would require obtaining prices from suppliers and ordering the produce from which the juices would be made.

Once you have completed reading this case study, visit the discussion questions to discuss key risks in this project.

© Copyright 2015 by the University of Virginia Darden School Foundation
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