A Project on Supply Chain Management_2

1. EXECUTIVE SUMMARY
As every business concern irrespective of its size, nature, and age needs an
adequate concentration on its supply chain to carry out regular business operations and
survive in the international competition. A supply chain is a system of organizations,
people, technology, activities, information and resources involved in moving a product or
service from supplier to customer. Supply chain activities transform natural resources,
raw materials and components into a finished product that is delivered to the end
customer.
The project report titled “A Supply Chain Management For Everest Industries
Ltd, Lakhmapur Works (Nashik)” deals with this matter and is based on the in-house
industrial training at Everest Industries Ltd, pertaining to the requirement for the
Master of Business Administration from “Kautilya Institute of Management &
Research, Wagholi, Pune”.
Everest Industries Ltd formerly subsidiary of ACC Ltd, Founded in 1934, is engaged in
building solutions like Roofing, Ceiling, Wall, Flooring, Cladding, Door and the Pre
Engineered steel Buildings for the Industrial, Commercial & Residential sector. Holcim,
world’s second largest cement producer gained control of Everest Industries after
acquiring ACC by gaining majority stake in Ambuja cements India from Sekhsarias. In
2006 Holcim exited from Everest Industries after selling their stake back to Everest
finvest (India) controlled by Sekhsarias for Rs 134 a share. Company is renowned
enterprise in India because of its continuously introduced innovative and modern building
products.
Historically, Everest has provided rural shelters by making corrugated roofing
sheets available to farmers at a competitive price. The company is poised to capitalize on
the opportunities in rural India where various housing and infrastructure initiatives are
envisaged by the Government. Today, Everest offers a complete range of building
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2. solutions which includes Ceilings, Walls, Flooring, Cladding, Doors, Roofing and Pre-
Engineered Steel Buildings.
Company has installed capacity of 710000 MT Building products and 30000 MT
Building steel with capacity utilization of 72.47% and 40.97% respectively.
Manufacturing facilities of the company are at Bhagwanpur, Nashik, Coimbatore,
Kolkata and Kymore. Everest is one of the most respected and renowned business entities
in India, and has dominated the market ever since.
The company is poised to capitalize on the opportunities in rural India where
various housing and infrastructure initiatives are envisaged by the Government.
Today, Everest offers a complete range of building solutions which includes
Ceilings, Walls, Flooring, Cladding, Doors, Roofing and Pre-Engineered Steel Buildings.
These are produced at Everest's state-of-the-art ISO: 14000 certified manufacturing
facilities at Kymore, Nashik, Coimbatore, Kolkata and Roorkee. With over 4000 retail
points spread across the nation together with the strength of over 1285 highly qualified
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3. and experienced engineers, designers and technicians, Everest provides building solutions
to the consumers that successfully meet the highest standards of quality and durability.
Trained manpower is the dedicated strength of Everest. Apart from continuous
development of employee skills, the company is also committed to their welfare.
After successfully catering to the Indian market, Everest Industries Limited has
widened its horizons in the international arena. With consistent exports to Europe, Africa,
Australia and Asia, Everest is all set to scale new heights and establish a strong
foundation in the global market. Banking on its 74 years of experience and highly
sophisticated technology, Everest assures to the customers that all its products live up to
its promise of Strength, Speed and Safety.
After successfully catering to the Indian market, Everest Industries limited has
widened its horizon in the international arena. With consistent exports to Europe, Africa,
Australia and Asia, Everest is all set to scale new heights and establish a strong
foundation in the global market.
As supply chain contains every small part which is playing a prominent role in the
production, the study of raw materials, work-in-progress (WIP), finished goods are very
crucial to analyze. The project contains the procedures for the analysis of supply chain,
raw materials, work-in-progress, finished goods.
Keeping this background in view, an attempt is made to examine the performance
of supply chain management in Everest Industries Ltd, Lakhmapur Works (Nashik).
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4. OBJECTIVES
To find out the efficiency of Supply chain management in Everest Industries
Ltd (Lakhmapur Works).
To study how supply chain management practices plays an important role in
supporting other activities of an organization.
Provide quality products in affordable prices to acquire customer satisfaction.
To gain familiarity with the various methods and techniques followed by Everest
Industries Ltd (Lakhmapur Works) in maintaining their inventories in order to
manage supply chain efficiently.
To study and come out with any solution for improvement of inventory
management in Everest Industries Ltd (Lakhmapur Works).
Reducing Inventory Cost, Lead Time, Transportation Cost, Warehouse Cost.
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5. SCOPE OF STUDY
In supply chain management, Inventories like raw materials, finished goods, work
in progress, supplies and other accessories constitute the principal item in the
working capital of the majority of trading and industrial companies.
To maintain the continuity in the operations of business enterprise, a continuous
supply of these inventories is required.
Management of inventory is designed to regulate the volume of investment in
goods on hand, the types of goods carried in stock to meet the needs of production
and sales while at the same time, the investment in them is to kept at a reasonable
level.
However, the physical control of inventory is the operating responsibility of stores
superintendent and financial personnel have nothing to do about it but the
financial control of these inventories in all lines of activity in which they
comprise a substantial part of the current assets is a frequent problem in the
management of supply.
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6. ABOUT THE COMPANY
EVEREST INDUSTRIES LTD.
NAME:
·Everest Industries Limited.
ADDRESS:
·Gat No. 152, Lakhmapur,
Tal: Dindori, Dist: Nashik. 422202 (Maharashtra)
·Everest Industries Limited is one of India's fastest growing building solution
companies. Everest offers a complete range like Roofing, Ceilings, Walls, Floors,
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7. Cladding, Doors, and Pre-Engineered Steel Buildings for the Industrial,
Commercial and Residential Sectors.
1. Roofing Solutions 2. Ceiling Solutions
3. Door Solutions 4. Wall Solutions
Broad Functions of EVEREST INDUSTRIES LTD.
Laying down policies.
Formulating long and short term strategies.
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8. Monitoring the functions of the subsidiary companies
Laying down suitable system and procedures.
Assisting the subsidiary companies to achieve their objectives
VISION AND MISSION OF THE COMPANY
Everest will be the deepest penetrated housing and building solutions provider to
deliver Strength, Speed and Safety to its customers in all its target markets.
MISSION
·To try to set new policies for achieving company’s objectives.
·To reach maximum customers with high quality products.
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9. ·Continually improvement in the quality by management responsibility, resource
management, product realization and measurement analysis &.improvement.
·Everest has its expansion plan in Orissa for 100000 MT in roofing business &
targets to cross 1000 Crore turnover in for year 2012 and 1300 Cr turnover
by for year 2013.
FUTURE PLAN OF ACTION:
•Development of boards for needs of building industry for quicker construction.
•Development of High strength products.
•Development of high performance boards for wet area application.
•Use of new processing methods to improve raw material characteristics and their
by improved strength in finished products.
•Development of new designer boards
•Use of new fibers for reinforcement.
COMPANY INFORMATION
Everest is one of the most respected and renowned business entities in India.
Everest is the IS / ISO 9001: 2000 certified manufacturing company.
Everest has the strength of over 1285 highly qualified and experienced
engineers, designers and technicians.
 Lakhmapur Works established in the year 1994-95, is about 60 acres & 35 km
away from holy city of Nashik.
Integrated township for employees & occupational Health centre.
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10. Canteen for employees / Workmen.
Good working environment in the company.
QUALITY POLICY
We, at Everest Industries Ltd., manufacturer of fibre cement products are strongly
committed to:
Manufacture and sell quality proven products.
Provide the most efficient service to our customers.
Continually improve effectiveness of quality management system by:
Regular monitoring and measurement of process and products to achieve the set
quality objectives.
Providing required resources and developing competence of the people in the
organization.
Periodic review of the system for sustainable development.
Comply with all relevant regulatory, statutory and other requirements.
The above policy is well implemented, maintained and communicated to all employees,
customers & other interested parties.
Our Motto
“Continuous customer delight is our reward”
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11. M. I. Gupta
Managing Director
__________________________________________An group Company
EVEREST SHAREHOLDING PATTERN
A.Public Shareholding (Indian & Foreign)
B.Promoter & Promoter Group
C.Public (More than 1 % of the total shares)
Below mentioned chart showing shareholding of persons belonging to the category
“Public” and holding more than 1% of the total number of shares.
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12. ·Reliance Capital Trustee Co Ltd is the biggest share-holder of the Everest
Industries Ltd. It has 46.29 % shares.
·Second highest customer share is of Everest Staff Welfare Trust.
·Other customer shares are also taken into consideration. They are IL & FS
Securities Ltd, India Optima Ltd, and Ramesh Damani etc.
HISTORY OF THE COMPANY
Everest Industries Ltd was incorporated in the name & style Asbestos Cement
Ltd., as a private limited Comp. under the Indian company Act, VII of 1913 with
two corporate shareholders viz., C.P. Cement Co. Ltd.
The Comp. was the first to set up facilities for manufacture of asbestos cement
roofing sheets in India with the commissioning of its first factory in May at
Kymore in Madhya Pradesh.
The manufacturing business was expanded progressively by establishing a second
sheeting factory at Mulund [Mumbai] in 1937, a third factory at Calcutta in
October 1938 & a fourth factory at Podanur near Coimbatore in Tamil Nadu in
November 1953.
Lakhmapur plant was incorporated in the year 1994-95.
Everest Industries has reported a sales turnover of Rs 144.92 crore and a net profit
of Rs 4.62 crore for the quarter ended Sep 2010.
The company’s turnover growth for last 5 years is about 24% CAGR.
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13. FINANCIAL PERFORMANCE AT GLANCE
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14. ·Increasing income per financial year i.e. from the year 2006 to 2011 (Except year
2007-08).
·Sales increased year after year.
ORGANIZATION CHART
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15. PURCHASE CYCLE
Major activities of Purchase Cycle
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16. PRODUCT PROFILE
1. ASBESTOS CEMENT CORRUGATED ROOFING SHEETS
It is available in many sizes, i.e.1 meter to 3.5 meters.
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17. 2. NON ASBESTOS FIBRE CEILING CEMENT BOARDS
Non-asbestos fibre cement boards have more than 1200 varieties.
3. COMPRESSED BOARDS
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18. 4. SOLID WALL PANELS
Solid wall panels are available in minimum 15 sizes. Some of the sizes can be given
as follows.
1. 600x600x50 mm
2. 300x600x50 mm
3. 900x600x50 mm
4. 1800x600x50 mm
5. 2100x600x50 mm
6. 2400x600x50 mm
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19. 7. 3000x600x75 mm
5. EVEREST WALL BOARDS
1. 3050X1220X10 mm
2. 3000x1200x10 mm
3. 1525x610x10 mm
4. 1525x1220x10 mm
There are also so many other moulded goods (Accessories) are produced by
Everest Industries Limited. It is providing various small parts for building constructions.
RAW MATERIALS FOR THESE PRODUCTS
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20. In the Everest Industries Ltd, there are some main raw materials are being used.
These are –
1.Cement:
In the most general sense of the word, cement is a binder, a substance that
sets and hardens independently, and can bind other materials together.
2.Paper Pulp:
Pulp is a fibrous material prepared by chemically or mechanically
separating cellulose fibers from wood, fibre crops or waste paper. Wood
pulp is the most common raw material in papermaking.
3.Fly Ash:
Fly ash is one of the residues generated in combustion, and comprises the
fine particles that rise with the flue gases.
4.Fibre:
Fiber (or fibre) is a class of materials that are continuous filaments or are
in discrete elongated pieces, similar to lengths of thread.
SUPPLIERS FOR RAW MATERIALS
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21. 1.CEMENT:
•ACC Cement
•India Cement
•Ultra-tech Cement
2.PULP:
•Pulp mostly imported from Russia, Canada, South Africa.
•Shakti Handmade Paper Ltd
•Saaket Enterprises
3.FLY ASH:
•Fly ash is the material available free of cost from Eklahare Thermal Power
Station. Only transportation required for it.
•Pooja Traders
•Meghdoot Suppliers
•Vinod Transport
4.FIBRE:
•Fibre is all imported by Brazil and Russia.
SUPPLY CHAIN MANAGEMENT
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22. Supply chain management is management of the entire flow of information,
materials, and services from raw material suppliers through factories and warehouses to
the final end-customer.
WHAT IS SUPPLY CHAIN MANAGEMENT
Supply chain management is the process of movement and storage of raw materials,
work-in-progress inventory, and finished goods from point of origin to point of
consumption. Supply chain includes design, planning, execution, control, and monitoring
with the objective of creating net value, building a competitive infrastructure, leveraging
worldwide logistics, regular supply with demand and measuring performance globally.
Inventory is one of the important aspects in the supply chain. Inventory is a list
for goods and materials, or those goods and materials themselves, held available in stock
by a business. Storage and supply of the raw materials to the various departments as per
demand is done in the company.
There are various components are used in SCM, these are:
 Planning and control
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23.  Work structure
 Organization structure
 Product flow facility structure
These components are taking into consideration in the company. For that, buyer-
supplier relationship should be maintained at various levels.
DEFINITION OF SUPPLY CHAIN
A supply chain is a system of organizations, people, technology, activities,
information and resources involved in moving a product or service from supplier to
customer. Supply chain activities transform natural resources, raw materials and
components into a finished product that is delivered to the end user or consumer who
directly consumes the goods. In sophisticated supply chain systems, used products may
re-enter the supply chain at any point where residual value is recyclable.
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24. THE DEMING CYCLE (PDSA cycle) (PDCA cycle)
The Deming Cycle, or PDSA cycle, is a model for continuous improvement of
quality. It consists of a logical sequence of four repetitive steps for continuous
improvement and learning: PLAN, DO, STUDY (CHECK) and ACT. The PDCA cycle is
also known as the Deming Cycle, or as the Deming Wheel or as the Continuous
Improvement Spiral. It originated in the 1920s with the eminent statistics expert Mr.
Walter A. Shewart, who introduced the concept of Plan, Do and See. Deming modified
the cycle of Shewart towards: PLAN, DO, STUDY and ACT. The Deming Cycle is
related to Kaizen thinking and Just-in-time manufacturing.
BENEFITS OF THE DEMING CYCLE
·Daily routine management-for the individual and/or the team,
·The problem solving process,
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25. ·Project management,
·Continuous development,
·Vendor development,
·Human resources development,
·New product development, and
·Process trials.
The 4 parts of the Deming Cycle explained
·PLAN - Plan ahead for change. Analyze and predict the results.
·DO - Execute the plan, taking small steps in controlled
circumstances.
·STUDY (CHECK) - Study the results.
·ACT - Take action to standardize or improve the process.
OBJECTIVES OF SCM
The objective of every supply chain is to maximize the overall value generated.
The value a supply chain generates is the difference between what the final product is
worth to the customer and the effort the supply chain expends in filling the customer’s
request. For most commercial supply chains, value will be strongly correlated with
supply chain profitability, the difference between the revenue generated from the
customer and the overall cost across the supply chain.
For example, a customer purchasing a roofing sheet from Everest pays Rs. 700,
which represents the revenue the supply chain receives. Everest and other stages of the
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26. supply chain incur costs to convey information, produce components, store them,
transport them, transfer funds, and so on. The difference between the Rs. 700 that the
customer paid and the sum of all costs incurred by the supply chain to produce and
distribute the roofing sheet represents the supply chain profitability.
Supply chain profitability is the total profit to be shared across all supply chain
stages. The higher the supply chain profitability, the more successful the supply chain.
Supply chain success should be measured in terms of supply chain profitability and not in
terms of the profits at an individual stage.
MANAGING THE SUPPLY CHAIN
Supply chain should be managed effectively for the accurate production at the
right time. Some of the options for managing supply chain are given below:
Postponement, Channel assembly, Invoice-less purchasing, Electronic ordering and funds
transfer, Stockless purchasing, Standardization and Internet purchasing
VENDOR SELECTION
Selection of the supplier of the material is important part in the production point
of view. Vendor evaluation can be done by identifying & selecting potential vendors.
SUPPLIER SELECTION CRITERIA
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27. Company
Financial stability
Management
Location
Product
Quality
Price
Service
Delivery on time
Condition on arrival
Technical support
Training
NATURE OF SCM
Supply chain is defined as entire flow of information, materials, and services from
raw material suppliers through factories and warehouses to the final end-customer. These
are maintained on hand at or near a business's location so that the firm may meet demand
of the various departments, as well as customers and fulfil its reason for existence. If the
firm is a retail establishment, a customer may look elsewhere to have his or her needs
satisfied if the firm does not have the required item in stock when the customer arrives. If
the firm is a manufacturer, it must maintain some its chain of raw materials and work-in-
progress in order to keep the production running in good conditions.
If the firm exists in a volatile environment where demand is dynamic (i.e., rises
and falls quickly), an on-hand inventory could be maintained as a buffer against
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28. unexpected changes in demand. This buffer inventory also can serve to protect the firm if
a supplier fails to deliver at the required time, or if the supplier's quality is found to be
substandard upon inspection, either of which would otherwise leave the firm without the
necessary raw materials.
Raw material:
Raw materials are inventory items that are used in the manufacturer's
conversion process to produce components, subassemblies, or finished products. These
inventory items may be commodities or extracted materials that the firm or its subsidiary
has produced or extracted. They also may be objects or elements that the firm has
purchased from outside the organization. Even if the item is partially assembled or is
considered a finished good to the supplier, the purchaser may classify it as a raw material
if his or her firm had no input into its production. Typically, raw materials are
commodities such as ore, grain, minerals, petroleum, chemicals, paper, wood, paint, steel,
and food items. However, items such as nuts and bolts, ball bearings, key stock, casters,
seats, wheels, and even engines may be regarded as raw materials if they are purchased
from outside the firm.
Work in Progress:
Work-in-progress (WIP) is made up of all the materials, parts (components),
assemblies, and subassemblies that are being processed or are waiting to be processed
within the system. This generally includes all material from raw material that has been
released for initial processing up to material that has been completely processed and is
awaiting final inspection and acceptance before inclusion in finished goods. Any item
that has a parent but is not a raw material is considered to be work-in-progress.
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29. Finished goods:
A finished good is a completed part that is ready for a customer order.
Therefore, finished goods inventory is the stock of completed products. These goods have
been inspected and have passed final inspection requirements so that they can be
transferred out of work-in-progress and into finished goods inventory. From this point,
finished goods can be sold directly to the final user, sold to retailers, sold to wholesalers,
sent to distribution centres, or held in anticipation of a customer order. The levels of the
above 3 kinds of inventories differ depending upon the nature of business.
VARIOUS COSTS INCLUDED IN SCM
ORDERING COSTS
For a large organization like Everest Industries, it is necessary to have a separate
purchase office to purchase thousands of items. The demands received are technically
scrutinized and for purchasing them, inquiries are issued, tenders are received and
evaluated, orders are progressed, materials are received and inspected and lastly, the
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30. payments are arranged. All these mean additional costs to the organization. All these
costs together constitute what is called cost of ordering or cost of acquisition.
CARRYING COSTS:
The very fact that the items are required to be kept in stock means additional
expenditure has to be arranged in the organization. The different elements of costs
involved in holding these inventories are as follows:
1. Capital costs:
When materials are kept in stock money representing the value of materials is
blocked. In a multi-national economy, capital is extremely scarce and as such, the real
value of capital is much higher than the nominal rate of interest which the organization
like Railways may be paying. The money which is blocked up is not available to the
organization to do more business or to use it for alternative productive investment.
2. Obsolescence and depreciation:
The costs because of obsolescence and depreciation are very important even
though they are very difficult to assess. This factor is relatively higher for spare parts
inventory as against raw material inventory. Larger the stock we keep more the risk of
obsolescence and as such, the costs are expressed as the percentage costs to the average
inventory holding and can be between 2 to 5%.
3. Cost of storage, handling and stock verification:
There are additional costs because of the clerical work involved in handling of
materials in the ward, in stock verification, in preservation of materials as well as the
costs because of various equipments and facilities created for the purpose of materials.
A part of this cost is of a fixed nature. The major portion of the cost including the
cost of staff, however, can be treated as variable costs at least in the long run.
4. Insurance Costs:
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31. Materials in stocks are either insured against theft, fire etc., or we may have to
employ watch & ward organization and also fire fighting organizations. Cost of this may
also be 1 to 2%. The average inventory carrying costs can, therefore, be as follows:
A.Interest/costs of capital/opportunity cost 15 to 25%.
B.Obsolescence and depreciation cost 2 to 5%.
C.Storage, handling 3 to 5%.
D.Insurance costs 1 to 2%.
E.Total 21 to 37%.
SHORTAGE COSTS:
Whenever an item is out of stock and as such cannot be supplied, it means that
some work or the other is delayed and this, in turn, leads to financial loss associated with
such stoppage or delay of work.
For example, if a locomotive remains idle for want of spare parts, the Earning
capacity of the locomotive is lost for the duration of this period. On the other hand, the
spare parts required will have to be purchased on Emergency basis or have to be specially
manufactured resulting in Additional costs.
Stock out costs can vary from item to item and from situation to situation
depending upon the emergency action possible. No attempt therefore, is normally made
to evaluate a stock out cost of an item. Nevertheless, it is Important to understand the
concept of stock out costs, even though the Actual quantification is not possible.
SYSTEM COSTS:
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32. These are the costs which are associated with the nature of the control
systems selected. If a very sophisticated model of the relationship between stock out
costs, inventory holding cost and cost of ordering is used and operated with the help of a
computer, it may give the theoretical minimum of the other costs but the cost of such
control system may be sufficiently high to offset the advantages achieved.
PRICING OF RAW MATERIAL:
Several methods are used for pricing inventories used in production. The
important ones are:
·First-in first-out (FIFO) method.
·Last-in first-out (LIFO) method.
·Weighted average cost method.
·Standard cost (price) method.
FIFO Method:
This method assumes that the order in which materials are received in the stores is
the order in which materials are issued from the stores. Hence, the material which is
issued first is priced on the basis of the cost of material received earliest, so on and so
forth.
LIFO Method:
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33. This method is the opposite of FIFO method: It assumes that the material which is
acquired last is issued first. Hence material issues are priced on the basis of the cost of
most recent material purchases.
Weighted Average Cost Method:
Under this method, material issues are priced at a weighted average cost of
materials in stock. To get an up-to-date weighted average cost figure, a new weighted
average cost is calculated each time a delivery is received.
Standard Price (Cost) Method:
Under this method a standard price is predetermined. When materials are
purchased the stock amount is debited with the standard price. The difference between
the actual price & standard price is carried to a variance account. Material issued is
charged as per the standard price.
Everest Industry following the FIFO methods in regular production. But
sometimes, managers also use Last in First Out method to use the material. It is depend
on the prices and availability of the raw materials.
SUPPLY CHAIN AND DEMAND CHAIN
•Demand chain is defined as the system by which organizations manage sales and
distribution of products and services to end users.
•Conceptually incorrect to look at demand chain separately
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34. •A supply chain is a system of organizations, people, technology, activities,
information and resources involved in moving a product or service from supplier
to customer.
•Supply chain activities transform natural resources, raw materials and components
into a finished product that is delivered to the end customer.
STEPS INVOLVED IN SCM
1. Designing the supply chain:
Determine the supply chain network
Identify the levels of service required.
2. Optimizing the supply chain:
Determine pathways from suppliers to the end customer
Customer markets to Distribution centers
Distribution centers to production plants
Raw material sources to production plants
Identify constraints at vendors, plants and distribution centers
Plan the procurement, production and distribution of product groups rather
than individual products in large time periods- quarters or years.
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35. RESEARCH METHODOLOGY
Research:
Research in common parlance refers to a search for knowledge. Research is an
endeavor to discover answers to problems (intellectual and practical) through the
application of scientific method to the knowable universe.
Research is essentially a systematic enquiry seeking acts through objectives
verifiable methods in order to discover the relationship among them and to deduce from
and them broad principles or laws. It is really a method of critical thinking. It comprises
defining and re-defining problems, formulating hypothesis or suggested solutions,
collecting, organizing and evaluating data making deductions and making conclusions to
determine whether they fit the formulated hypothesis. Thus the term ‘research
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36. experimentation or examination’ has as its aim the revision of accepted conclusions, in
the light of newly discovered facts.
Research may be defined as,
“The systematic and objective analysis and recording of controlled
observations that may lead to the development of generalizations principles or
theories resulting in prediction and possibly ultimate control of events”.
Research also defined as,
“A Careful investigation or inquiry especially through search for new facts in
any branch of new knowledge”
Research Methodology:
It is a systematic way to solve the research problem. It may be understood as a science of
studying how research is done scientifically. In it we study the various steps that are
generally adopted by researcher in studying his research problem along with the logic
behind them. Population is totally of items under the consideration.
OBJECTIVES OF RESEARCH:
The objective of the research is to reach new conclusion to establish fact to study
a subject scientifically and verify the knowledge. The purpose of research is to discover
answers to questions through the application of scientific procedures. The main aim of
research is to find out the truth which is hidden and which has its own specific purpose.
1. To gain familiarity with a phenomenon or to achieve new insights into it
(studies with this object in view are termed as exploratory of formulate research studies).
2. To portray accurately the characteristics of a particular individual, situation or a
group (studies with this object in view are known as descriptive research studies).
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37. 3. To determine the frequency with which something occurs or with which it is
associated with something else (studies with this object in view are known as diagnostic
research studies).
4. To test a hypothesis of a causal relationship between variables (such studies are
known as hypothesis-testing research studies).
DATA COLLECTION METHODOLOGY
The data which I have collected for making this project is combination of both
primary and secondary data.
PRIMARY DATA:
This data had been collected through meetings and interviews with various
managers and employees of the Store, Quality and Dispatch department of
Everest Industries Ltd (Lakhmapur Works). At the same time I had visited
various other departments for collection of data. The departments that had been
visited are as follows.
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38. Production Department.
Research & Development Department.
SECONDARY DATA:
Apart from the primary data certain secondary data were required for this project.
Following are the sources of secondary data:
Raw Materials Report.
Production Reports.
Sales Reports.
Inventory Reports.
The initial step of the project was studying about the company and the
industry. For this study, the size of the company has been taken into consideration.
Quarterly Results of Everest Industries
(In Rs. Crore)
Month Mar’ 10Jun’ 10 Sep’ 10 Dec’ 10 Mar’ 11
Sales 186.68 200.04 144.92 180.32 197.82
Other Income 3.61 0.60 --- 7.75 0.79
Total Income190.29 200.64 144.92 188.07 198.61
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39. Interpretation:
The above table indicates that the quantum of sales in Everest Industries lit,
Nashik. It showed a consistent trend during the five months i.e. in March 2010 to March
2011. During the first quarter, the sale is increased up to 10 crore. Then, it reduces up to
144 crore. It means in the month of July, August and September, the sale is decreased up
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40. to 25 %. But from September 2010 sales level increased to 180 crores. This analysis
suggests that the company earnings profit in the month of first two quarters as well as last
quarter of the year. We can say, the first quarter of the year is the period when company
earnings maximum profit.
SUGGESTIONS
Everest Industries Ltd is one of the leading companies which are providing
building solutions like roofing sheets, walls, floors, ceilings, claddings, doors and steel
buildings. Even though, company needs some plan of actions for the betterment. Some of
the points can be mentioned as below.
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41. •Company should try to use some modern techniques for time saving. JIT (just in
time) is one of the good methods for it. This will help in minimizing precious time
as well as blockage of the materials.
•Proper concentration should be given on the mode of transportation i.e. Trucks
and find an optional way to prevent loss in production.
•Prepare a blueprint for change that maps linkages among initiatives.
•Assess the entire supply chain from supplier relationships to internal operations to
the market place, including customers, competitors and industry as a whole.
•The management of the plant incorporated with TQM (Total quality
management), but it should be not only on paper. It has to be followed by regular
basis for its better benefits.
•If the management takes actions to investigate the causes of differences/ shortages
of Stores and spares and thus remove the losses from the accounts, it will help to
increase inventory turnover.
LIMITATIONS
Topic:
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42. Considering the vast subject of the project, it was hardly possible to cover up all
the detail analysis of the overall view of the cost reduction and cost control on supply
chain of the company.
Regarding data Collection:
The data collected is small and it is difficult to make conclusion regarding whole
industries. More details information needed for more deep study of the company and
calculations.
Time limitation:
The duration of project work was for two months. Within this short period it is not
possible to collect large data. For supply chain management lot of discussion and
practical knowledge is required. So, the time limit was short for duration of project.
CONCLUSION
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43. The overall performance in respect to utilization of materials is satisfactory during
the study period.
The inventory level may also be reduced to the possible level in order to release
idle funds absorbed in inventories.
The efficiency of the company in regular production is fair because it’s regularity
in the material providing. Store department takes necessary actions for it. If only
20% materials is available in store, then the materials manager ordering the
materials from the suppliers with specific period.
The company is maintaining good relations with its suppliers. The analysis of the
annual report shows that there is very less possibility of errors because of the
skilled workers, technical staff.
The proportion of inventory out of total current assets had been efficiently
reduced by the management thereby reflecting a better supply chain management.
There had been significant consistency in the production of every plant.
On the whole it can be said that Everest Industries Ltd., which follows best
techniques of supply chain management as it is one of the well-known and
leading international building solutions provider company.
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44. BIBLOGRAPHY
Websites
http://www.everestind.com
http://everestbuildingsolutions.com
http://www.moneycontrol.com
Financial Daily
Economic Times.
Financial Express.
Books
Sunil Chopra and Peter Meindel. Supply Chain Management:
Strategy, Planning, and Operation, Prentice Hall of India, 2002.
N. Viswanadham and Y. Narahari. Performance Modeling of
Automated manufacturing Systems, Prentice Hall of India, 1998.
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