Project Report632
Project Report632
Project Report632
ON
INVENTORY MANAGEMENT OF VERKA MILK PLANT
LUDHIANA
MASTER OF COMMERCE
CLASS:- M.COM
The most motivating aspect associated with pursing a course into one’s
personality & vision by accumulating wider knowledge developing
analytical & conceptual skills, not only by traditional way of teaching&
learning, but also by observing the things at work.
The assignment one gets in the form of projects, seminars, term papers
give a considerable exposures to students& provides them with an
opportunity to see the practical aspect of working or corporate world.
This assignment of ours is yet another opportunity for us to see the
application part of what we learn.
INTRODUCTION OF
INDIAN DAIRY
INDUSTRY
INTRODUCTION
The dairy sector in the India has shown remarkable development in the past decade and India
has now become one of the largest producers of milk and value added milk products in the
world. The dairy sector has developed through co-operatives in many parts of the state. During
1997-1998, the state had 60 processing plants with an aggregate processing capacity of 6 million
lack liters per day. In addition to these processing plants and 45 co-operative milk chilling centre
operate in the state.
With the increase in the milk production. Maharashtra now regularly exports milk to
neighboring states. It has also initiated a free school feeding scheme, benefitting more than three
million school children from over 19000 schools all over the state.
INDIAN DAIRY INDUSTRY
Dairy is a place where handling of milk and milk products is done and technology refers to the
application of scientific knowledge for practical purposes. Dairy technology has been defined as
that branch of dairy science, which deals with the processing of milk and the manufacture of
milk products on an industrial scale.
In developed dairying countries such as the U.S.A, the year 1850 is seen as the dividing line
between farm and factory scale production. Various factors contributed to this change in these
countries, viz. concentration of population in cities where jobs were plentiful, rapid,
industrialization, improvement of transportation facilities, development of machines, etc.
whereas the rural areas were identified for milk production, the urban areas were selected for the
location of milk processing plants and product manufacturing factories. These plants and
factories were rapidly expanded and modernized with improved machinery and equipment to
secure the various advantage of large scale production. Nearly all the milk in U.S.A before 1990
was delivered as raw(natural) milk. Gradually farmers within easy driving distance began
delivering milk over regular routes in the cities. This was the beginning of the fluid milk-sheds
which surround the large cities of today. Prior to the 1850s most milk was necessarily within a
short distance of the place of consumption because of lack of suitable means of transportation
and refrigeration.
The Indian Dairy Industry has made rapid progress since Independence. A large number of
modern milk plants and products factories have since been established. These organized dairies
have been successfully engaged in the routine commercial production of pasteurized bottled
milk and various. Western and Indian Dairy products. With modern knowledge of the protection
of milk during transportation, it became possible to locate diaries where land was less expensive
and crops could be grown more economically.
In India, the market milk technology may be considered to have commercial in 1950, with the
functioning of the Central Dairy of Aarey Milk colony, and milk product technology in 1956
with the establishment of AMUL DAIRY, Anand. The industry is still in its infancy and barely
10% of our total milk production under goes organizational handling.
EQUITY PARTICIPATION
The paid up equity of milkfed as on 31.3.2012 was to the tune of Rs.46.86
crores which comprises of Rs.28 crores from the cooperative member and
balance Rs.17.93 crores from State Government.
SCHEMES
COMMUNITY BASED SILAGE MAKING IN KANDI AREAS :-
Milkfed initiated community based silage making to fulfill shortage of green
fodder in kandi area of Hoshiarpur & Gurdaspur. This will ensure availability
of green fodder in the shape of Silage during scarcity period. This will help in
improving milk production. 50 Silo pits of capacity 150 M.T. each will be
constructed during the year 2009-10 Rs.10.15 crore shall be given as capital
grant for construction of Silo pits, chaff cutters, weighing balance and training.
FODDERSEED MULTIPLICATION PROGRAMME :-
FUTURE PLANNING:-
Punjab is the state, which has pioneered the green revolution in the country. It
is because of the efforts of the Punjab farmers that India now occupies an
enviable position of self-reliance in respect of food grains on the world map.
Consequent upon intensification of agriculture, Punjab agriculture has now
reached saturation level beyond which further growth appears to be limited.
This necessities a fresh look at the agriculture scenario prevailing in the state
so that the Punjab farmer who is very enterprising and is receptive to new
technology
continues to reaps the fruits of his labour without permanent damaging his
environment.
The programme aims at bringing a voluntary oriented programmes directly
benefiting the farmer of Punjab. Under the programme following schemes are
proposed for Dairy Development concerning Milk fed, Punjab:-
STRENGTH:-
WEAKNESS:-
Situated between two rivers Ravi and Beas and prone of floods and
sometimes havoc is caused which ultimately affects the cattle of
population in the crease.
Indo pak border is near to gurdaspur at which situation always
distributing local population which ultimately affects cattle rearing by
the people.
Highly completive markets.
Financial position of plants is very weak from many years.
Sufficient working capital is not available.
Stagnation in milk procurement.
OPPURTUNITIES:-
THREATS:-
CHAPTER-3
INVENTORY
MANAGEMENT
INVENTORY MANAGEMENT
“ Inventory management is a science primarily about specifying the shape and
percentage of stocked goods. It is required at different locations of within a
facility or within many locations of a supply network to precede the regular
and planned course of production and stock of materials.”
CHAPTER-4
TYPES OF
INVENTORIES
TYPES OF INVENTORIES:-
TRANSIT INVENTORIES:-
Inventory many times have to be transported from one location to the other as
they pass through the levels of manufacturing. These inventories are called
transit or pipeline inventories as they are in transit form a location to another.
Automobile manufactures make use of freight consolidations to pool in their
investors.
CASE :- HPCL handles the transportation from refineries to customers through
various modes like roadways, shipping, pipelining etc.
BUFFER INVENTORIES:-
Inventories are sometimes used to count attrack the uncertaines of demand and
supply. They could also be used to take care of unforeseen situation like poor
transportation, poor quality etc. The more safety stock of a firm has very small
is its probability of running in to stock out situation.
APPLICATION INVENTORIES:-
Firm often purchase and hold stock which is much higher than their present
requirements in anticipation of a future event. These events can include:
Seasonal variation in demand
Price variations
Labour strike
This method firms to build up their inventory reserves when the demand is
declining and as the demand shoots up they can utilize the inventory. The firm
need not increase their inventory.
DECOUPLING INVENTORY:-
The production time of each machine in a manufacturing plant varies. Some
system produce more products in the same time duration. The fatering of any
machine must not affect the entire production process.
CASE:- Consider a book manufacturing firm. If it is known that the paper
manufacturing machine is not working for few days then the manager forecasts
the requirement and carries out other activities like binding so that the entire
processes still intact.
THE MOST COMMON USED
INVENTORIES :
RAW MATERIAL
WORK-IN-PROGRESS
FINISHED GOODS
MAINTAINANCE, REPAIR AND
OVERHAUL
CHAPTER -5
DETAIL OF
STORE
INVENTORY
IN VERKA
MILK PLANT
DETAIL OF STORE INVENTORY IN VERKA
VEHICLE SPARES:-
PREVIOUS YEAR AMOUNT-131905.15
CURRENT YEAR AMOUNT-204903.30
MACHINERY SPARES:-
PREVIOUS YEAR AMOUNT-7683936.70
CURRENT YEAR AMOUNT-8354041.25
OTHER CONSUMABLES STORES:-
They would soon become consumables in the market and that made me a bit
unhappy because I really valued their originality.
PREVIOUS YEAR AMOUNT-9722301.10
CURRENT YEAR AMOUNT-51393039.95
CHAPTER-6
REVIEW OF
LITERATURE
LITERATURE REVIEW ON INVENTORY
MANAGEMENT
In today’s world every business tries to strike a balance in inventory between
what is needed and what is demanded, considering the major factor of cost
cutting/reduction. This control is called inventory management or inventory
control. . Inventory is basically assets which are stock of any business.
Inventory management focus on the capacity of the inventory, the place in
which it is located so that one can use it when needed, supply chain
management of the raw materials and goods. Inventory management deals with
the demand forecasting, asset management of the raw material and goods, to
forecasts the demand of future. This helps the top level manager to understand
and coordinate with the supply chain management or production management
are satisfactory level of service.
Most company measures the ability to satisfy the customer by the following 3
factors/ methods:
1. Number of order which act per schedule.
2. Number of order which are sipped as per schedule.
3. The idle time in inventory as well as shortage.
CHAPTER – 7
LIMITATIONS
LIMITATIONS OF TRADITIONAL
INVENTORY MANAGEMENT PRACTICES:
Inventory management is affected by variations at any stage of production,
transportation or even warehousing. Proper inventory management will
increase the company’s flexibility with the right product available at the right
time at the right place.
DEFICIENT DEFINITIONS:
Any channel strategy has to revolve around the ultimate objective- a satisfied
customer. The issue that arises here is inadequacy in defining the customer
service. Since it is highly individual concept and cannot really be measured,
evaluation of performance is concern.
UNRELIABLE DELIVERY SCHEDULES:
Inventory-in-transit can lead to confusion in the ranks of both manufacturers
and the distributors. While the stock has already left the manufacturers
warehouses, any distributors in-transit can throw the distributors completely
off-schedule.
INFORMATION SYSTEMS:
Most of the manufactures and channel partners use information systems to
streamline their operations. However, these information systems operate in
isolation without any integration between themselves. This led to duplication
and redundancy in work.
SIMPLISTIC POLICIES:
Most inventory policies are centred on the quality of usage of goods stocked.
However, they do not always consider the unpredictability surrounding the
usage. Once they are also considered, the stocking policies will be more
flexible resulting in minimal stock- outs and inventory pile-ups.
IMPACT OF UNCERTAINTIES:
Most policies are formulated under a set of assumptions about the future.
Ideally, the potential variations from the projections should be predicted and
accommodated in the planning. When they are not, the impact of these
uncertainties will bear heavy on the inventory management.
ORGANISATIONAL BOTTLENECKS:
In case of business units and other profit centres, the internal suppliers have
their own goals to achieve, which derails the pursuit of synergy. Inter-
departmental and other bureaucratic issues have often been the cause of many
pitfalls.
THE METRICS:
Supply chains today have morphed into complex and confusing structures.
Measuring performance of even internal partners can at times be difficult;
therefore evaluating the supply chain can be cumbersome task.
CHAPTER-8
OBJECTIVES
OF
STUDY
OBJECTIVES
Diagnose the financial statement.
Asses the earning capacity or the profitability of an organization.
To ascertain the efficiency with which the firm is utilizing its assets in
generation sales revenue.
To give remunerative prices to farmers and to ensure permanent market
for the whole year.
To provide ISI marks good quality balanced cattle feed and fodder seeds
to the farmers.
To provide technical inputs like artificial insemination, to improve the
breed of aniamls, animals health services, preventive disease treatment
and awareness regarding farm mangement etc.
CHAPTER-9
RESEARCH
METHODOLOGY
RESEARCH METHODOLOGY
Research design is the arrangement of conditions for collection and
analysis data in manner to combine relevance to the researcher purpose
with economy in procedure. Research methodology is a way to
systematically solve the research problems. It deals with the objective of
a research study, the method of defining the research problem the type of
hypothesis formulated, the type of data collected, method used for data
collecting and analysing the data etc. The methodology includes
collection of primary and secondary data.
RESEARCH:
Any efforts which are directed to study of strategy neede to identify the
problems and selection of best solutions for better results are known as
research.
RESEARCH DESIGN:
In view of the objects of the study listed above an exploratory research
design has been adopted. Exploratory research is one which is largely
interprets and already available information and it lays particular
emphasis on anaysis and interpretation of the existing and available
information.
To know the financial status of the company.
To know the credit worthiness of the company.
To offer suggestions based on research finding.
TYPES OF RESEARCH:
DISCRIPTIVE RESEARCH:
The study follows descriptive research method. Descriptive studies aims at
portraying accurately the characteristics of a particular group or situation.
Descriptive research is concerned with describing characteristics of a particular
individual or a group. Here the researcher attempts to presents the fact by
collecting data.
RESEARCH DESIGN:
A research design is a basic of framework, which provides guidelines for the
rest of research process. It is the map of a blueprint according to which the
research is to be conducted.
SOURCES OF DATA:
The task of data collection begins after research problems has been identified
and research design chalked out. Data collected are classified into primary and
secondary data.
PRIMARY DATA:
Includes unstructured personal interviews from account officers in the
enterprise.
SECONDARY DATA:
Includes the annual report, website of the company and which of the company
and which of the company and which contains details, which is helpful for
making my project report.
TYPES OF SAMPLING DESIGN IN RESEARCH
METHODOLOGY:
When creating a sample design, a researcher decides from who or what they’ll
collect data. They also choose the techniques and procedures they’ll use to
select items or individuals for the sample. There are several types of sample
design that fall into two main categories:
PROBABILITY SAMPLING
SURVEYS
FOCUS GROUP
OBSERVATIONS
DOCUMENTS AND RECORDS
QUANTATIVE DATA ANALYSIS
DESCRIPTIVE ANALYSIS
INTERENTIAL ANALYSIS
CONTENT ANALYSIS
NARRATIVE ANALYSIS
CHAPTER-10
SUGGESTIONS
SUGGESTIONS
Lets keep it simple: inventory is the lifeblood of the supply chain. It’s what
flows from node to node.And at each node it’s critical to figure out that
perfect balance of supply and demand,or else suffer dire consequences. If
you have too little inventory you risk lost sales and customers from “ out of
stocks”. If you have too much inventory, you’ll need more of everything-
more space, more transportation,more handling, more labour and more
money.
1. Consider inventory optimization tools:
Inventory optmization tools have been gaining ground as companies
seek to evaluate their entire network and determine the best inventory
policies for each product at each node in their supply chain. These are
typically stand-alone software tools that use data from WMS and ERP
systems.
2. Employee business solutions thatb use real-time analytics
under one platform:
According to mechael wohlwend, vice president of SAP Americans and
this year’s vice president of the warehousing Education and research
council, “ the days of managing inventory using Excel Spreadsheets are
passe”
3. Don’t treat all SKUs the same:
There is no such thing as a one size fits all solutions. “ Each and every
product does not have the same supply and demand variability pattern”
says Sapra. “ Focus on these 20% that statistically make up 80% of the
volume and manage that inventory really well,so you maximise sales
and profits”.
4. Keep an eye on your suppliers:
There are suppliers that don’t necessarily stick to their schedule or
deliver on their commitments. “ It’s not only in terms of timing, but also
fill rate,” says Wheeler. “ If you ordered 1000 cases of pencils and the
order shows up at the door with only 900, then that’s a problem.
5. Track essential attributes:
Over the past few years, tracking product genealogy and tracebility are at
the top of inventory managers’must have lists.
“It’s not enough to just track your lot numbers,” says Curt Sardeson,
managing principle of the Open Sky Group, a consulting firm
specializing in supply chain management solution. “ If you used
subcomponents and subassembles that you mix into your product, you
also need to know those lot numbers in case your product has a recall.
6. Leverage Mobile Devices:
Mobile technologies and mobile user interfaces are new ubiquitous for
capturing data on inventory. “ It’s time for even businesses that don’t
see themselves as complex to demand mobility solutions for accuracy,”
says Oracle’s Sherman.
CHAPTER-11
FINDING
INVENTORIES
FINDING INVENTORIES
A Finding aid is a document that assists researchers in navigating a
large archival collection. It usually provides a biography of the
individual who created the collection, a chronology, a brief overview of
the material, and
a fodder-by-fodder list of contents. Findings aids for distinct collections
will be added to this site as they become available.
BEGINNING INVENTORY:
Beginning inventory is defined as the total dollar value of the
company’s inventory at the beginning of an accounting period.
Beginning inventory includes finished goods, work-in-progress, and
raw materials. The inventory is valued at its cost to the company,
including the purchase price, transportation costs, and other associated
expenses.
BEGINNING INVENTORY FORMULA:
BEGINNING INVENTORY =
SALES (COGS)+ENDING INVENTORY-PURCHASE(INVENTORY
ADDED TO STOCK)
ENDING INVENTORY=
BEGINNING INVENTORY+PURCHASE-SALES (COGS)
CHAPTER-12
CONCLUSION
CONCLUSION
BALANCE SHEET
CHAPTER-13
BIBLIOGRAPHY