Final Project on Supply Chain New

A PROJECT REPORT ON

“ANALYTICAL STUDY OF SUPPLY CHAIN MANAGEMENT PRACTICES ADOPTED BY DINSHAW’S DAIRY FOODS LTD.NAGPUR”

Submitted by RAUNAK RAVINDRA GAIKWAD

Under the guidance of Ms. MAMTA KAMBLE (Faculty MBA deptt.)

Submitted to GOVINDRAO WANJARI COLLEGE OF MANAGEMENT STUDIES AND RESEARCH, 156, Borkhedi (Gate), Near Railway Crossing, Butibori, Nagpur (M.S.) 1

GOVINDRAO WANJARI COLLEGE OF MANAGEMET STUDIES & RESEARCH BORKHEDI (GATE), BUTIBORI, NAGPUR, PH.NO.07104-329490 (Approved by AICTE New Delhi & Affiliated to Nagpur University)

Ref. No. :Date:-

Certificate This is to certify that Mr. Raunak Ravinda Gaikwad is bonafide student of Master of Business Administration course with specialization in Operations Management, for the session of 2009-2011 of Govindrao Wanjari College Of Management Studies and Research, Butibori, Nagpur. This candidate has worked under the supervision of Ms. Mamta Kamble and has satisfactorily finished his project work, in this academic session. The project submitted by his own work, and is complete so as to warrant its presentation for examination. His project work, entitled “to “ANALYTICAL STUDY OF SUPPLY CHAIN MANAGEMENT PRACTICES ADOPTED BY DINSHAW’S DAIRY FOODS LTD.NAGPUR” which is in partial fulfillment of requirement for the above course, and is being forwarded to Nagpur University for examination.

Date: Place: Nagpur

(Guide)

(Projectee)

Ms. Mamta Kamble

Mr. Raunak Ravindra Gaikwad

2

DECLARATION To, The Principal, Govindrao Wanjari College Of Management Studies and Research (MBA)

Respected Madam,

I RAUNAK RAVINDRA GAIKWAD, hereby declare that the project report entitled

“ANALYTICAL

STUDY

OF

SUPPLY

CHAIN

MANAGEMENT

PRACTICES ADOPTED BY DINSHAW’S DAIRY FOODS LTD.NAGPUR” is submitted by me for the partial fulfillment of MBA at Govindrao Wanjari College of Management Studies and Research (MBA). This report is an original work prepared by me.

Place: Nagpur

Name of Projectee

Date:

RAUNAK RAVINDRA GAIKWAD

3

ACKNOWLEDGEMENT

Any accomplishment requires the effort of many people and this work is not different. I am thankful to my faculty Ms. Mamta Kamble for supporting me and guiding me throughout the project. This report would not have been possible without her help.

I am equally thankful to the Principal, G.W.C.M.S.R, Butibori Dr. Asha Tiwari for encouraging me and inspiring me to do my project with full dedication.

RAUNAK GAIKWAD

4

INDEX Sr.no.

CHAPTERS

1

CHAPTER 1

PARTICULARS Abstract Aim Objectives

2

CHAPTER 2

Introduction of company

3

CHAPTER 3

Introduction of topic

4

CHAPTER 4

Literature review

5

CHAPTER 5

Research methodology

6

CHAPTER 6

Data analysis and interpretation

7

CHAPTER 7

Conclusion

8

CHAPTER 8

Suggestion

9

ANNEXURE 1 Bibliography

10

ANNEXURE 2 Questionnaire

5

PAGE NO.

AIM

“ANALYTICAL STUDY OF SUPPLY CHAIN MANAGEMENT PRACTICES ADOPTED BY DINSHAW’S DAIRY FOODS LTD.NAGPUR”

OBJECTIVES •

To study supply chain management at Dinshaw’s dairy foods ltd.

•

To study milk procurement process at Dinshaw’s dairy foods ltd.

•

To study production process at Dinshaw’s dairy foods ltd.

•

To study distribution network of Dinshaw’s dairy foods ltd.

•

To focus on product distribution process.

•

To study transport management system.

6

CHAPTER 2 INTRODUCTION OF COMPANY

DINSHAW’S ICE CREAM

INCEPTION

Early 1930s: Two enterprising brothers, DINSHAW and ERUCH RANA, started a small dairy business in Gittikhadan, on the outskirts of Nagpur. Their obsession with quality and transparent business practices, brought prosperity and confidence to the young businessmen. When opportunity knocked in the form of an Englishman who suggested that they try manufacturing ice cream, the idea was readily translated into reality. “DINSHAW’S ICE CREAM” was born in 1933 when Nagpurians came to know the creamy, hand churned delicacy.

INTIAL GROWTH An alien concept, ice cream eating was considered a luxury, which could only be indulged in, on very special days during the sweltering heat of Nagpur’s grueling summer. The conviction of their ultimate success, and the vision of these young entrepreneurs, far outweighed the difficulties of running a purely seasonal business with its vagaries of demand. By mid forties, Nagpur’s gentry had extended ice cream eating into the winter and the name DINSHAW’S had become synonymous with the ice cream in Nagpur.

7

THE SECOND GENERATION GROWTH: SAM DINSHAW RANA and JIMMY ERUCH RANA put on the mantles of their august fathers. Burning with the same zeal to succeed, the same uncompromising attitude towards quality and service, the Rana cousins struck out for wider horizons in 1981. With an investment of just Rs.5 Lakhs, a small factory came up to replace the cattle pounds. The dairy business gracefully gave way to its prospering offspring, the ice-cream business.

The magic of” “DINSHAW’S goodwill spawned a net work of enthusiastic dealerfranchises all over central India, where DINSHAW’S enjoy near monopoly even today.

Success breeds Success. The sound business principles of the founders, which gave them their initial success, became the foundation of DINSHAW’S business edifice. Quality consciousness went beyond the quality of relations with employees, business associates and its ultimate consumer. By 1987 DINSHAW’S was known in central India as not only the company, which made the best ice creams, but also the company that built best relations.

Persistent efforts from prospective distributors and dealers of other areas and greater demand for varieties from existing areas forced DINSHAW’S to expand its manufacturing capacities. Imported continuous freezers expand plants and storage facilities wide with market demand.

8

By 1989 cold storage depots had sprung up in Raipur, Jabalpur, Indore, Akola, Aurangabad, Pune, Hyderabad, Guntur and Vishakhapatnam more by pressures of demand than by design. Consumer appreciation for its products and for its credo of “VALUE FOR MONEY” forced continuous expansion and modernization of manufacturing capacities which today are to the tune of 35000 Liters of ice-cream per day. By 1990 the business was experiencing difficulty in getting regular supplies of good quality to need its ever-increasing needs. The obstacles were turned into an opportunity to diversify into Diary business.

The firm had turned full circle by coming back to its parent business of Diary which today has a capacity to process and pouch 1lac liters of Milk per day. The citizens of 9

Nagpur who were dependent only on milk supplied by Government Milk Scheme and local vendors welcomed the supply of standardized quality milk and DINSHAW’S became the first branded milk to be sold in Nagpur.

Being a responsible corporate citizen and being aware of the needs of protecting its environment, DINSHAW’S have invested more than Rs.70 Lakhs in an Effluent Treatment Plant, which is a model for any industry of its size.

As in all other areas,

Dinshaw’s foray in Bombay has been on a low key. DINSHAW’S have been able to grow in the face of competition from national and multinational giants of the industry because of the inherent strength of its products, policies and people.

10

CHAPTER 3 INTRODUCTION OF TOPIC The topic supply chain management is basically concerned with the following process of supply chain management and operations, like 1. Procurement and Production 2. Packaging 3. Distribution Practices followed by Dinshaw’s Dairy Products ltd. Nagpur.

1. PROCUREMENT AND PRODUCTION PROCESS AT DINSHAW’S The very first step of production at the Dinshaw’s dairy foods ltd. is procurement process Procurement of raw milk plays a crucial and key role in production process and in dairy industry as whole. The procurement process involves mainly following things as •

Suppliers

•

Quantity

•

Quality

•

Cost

•

Transportation ,handling, storage

Suppliers: There are two modes of raw milk procurement & supply. 1. Own collection 2. Other dairies

Own collection:Dinshaw’s has established dairies all over the Vidarbha and Maharashtra which provides a continuous supply of milk. This own collection also includes two modes as 11

(a) Chilling centers (b) Bulk coolers

Chilling centers:There are twelve chilling centers across vidarbha region. These plants are having capacity of 25000 liters. Milk is stored at low temperature & as per the capacity of plant supply is provided. There are some locations where chilling centers are located Ravanwadi, Dahegao, Neharwani,Selu, Tiroda, Mandhal, Kodamendhi.

Bulk coolers:These are milk storage plants having low storage capacity around 5000ltrs farmers provide the milk in loose i.e. 5 to 10 ltr each. Dinshaw’s provide support to the dairy farmers to run their farms

MILK PRODUCTION The buffalo and the cow and to a very limited extent the goat are the main milch animals in the India. The buffalo contributes some 64 per cent, the cow 33 per cent and the goat 3 per cent of the total milk produced in India. There are several well recognized breeds of cows and buffaloes in the region such as Red Sindhi, Gir, Tharparkar, and Sahiwal among the cows, and Murrah and Neeli Ravi among the buffaloes, are outstanding breeds. The milk of the buffalo is comparatively richer in fat content than that of the cow. In order to increase milk production we must have to : •

Upgrade our animals

•

Better feeding practices and

•

Well organized veterinary services, including artificial insemination.

The population of the cross-bred cows and the upgraded buffaloes is expected to increase the milk production significantly.

12

MILKING CONDITIONS AND HYGIENE Most of the milk in India is produced in the villages by farmers with small land holdings and also by landless agricultural laborers. Although an increasing portion of the milk produced is collected by the Supplier and other organized dairies, a significant portion of the milk is still being converted into traditional dairy products due to lack of refrigeration and transportation facilities. Conditions under which milk is produced in the villages are far from satisfactory, mainly because of the economic backwardness of the producers. The milk animals are housed in a part of the living space of the family or in small closed or open yards adjacent to the family house. Flooring is usually a plaster of mud. The cows are rarely washed before milking. Buffaloes generally wallow in ponds, especially in the hot summer months. Milking is done by hand, usually after suckling by the calf. Except in a few modern large farms, milking machines are not used. Because of the distances between the producing and consuming points, milk is unavoidably held at ambient temperatures for a significantly long time leading to high microbial growth. The high ambient temperatures in the region for the major part of the year support rapid microbial growth. The predominant types of micro flora in milk received in dairies are coliforms, micrococci, lactic streptococci, spore-forming aerobes and corynebacteria, the majority of these being contaminants from milk utensils. There is also a high incidence of thermo uric bacteria.

MILK PROCUREMENT DEPARTMENT (MPD)

Milk is procured form area to fulfill the industry needs by procurement departments of the companies. This is the most important department in every dairy industry, provided with highly paid Procurement managers supported with a team of qualified and experienced staff of zonal managers, area executives or milk collection controller, milk collection supervisors, mobile testers, drivers, peons and etc. in order to support the procurement staff a separate wing of accounts is also established. This

13

is the department with highest number of employees. Procurement of milk is not an easy job.

It stands on the following five pillars: 1. Quantity 2. Quality 3. Cost 4. Competition 5. Man Power

Quantity: Every dairy industry operates at its capacity to be a profitable. So in this competitive environment to have some specific volume of raw milk some time is the biggest challenge then quality. If a procurement department is failing to achieve the target quantity, it means it is not functioning properly. This definitely affects dairy business. Following factors affect the quantity: Season (availability of milk) Market competition Rate of milk Payment system (direct/banks) Payment duration (at Spot, after week, after fortnight) Milk procurement size (larger the size of the procurement greater the quantity of milk) Company strategy. Raw milk receiving parameters

Quality: Good quality milk is essential for production of good quality dairy products, taste and flavor, free from pathogens and long keeping quality. Good quality raw milk must be: a. Free from debris and sediment b. Free from off-flavors. 14

c. Low in bacterial numbers. d. Normal composition and acidity. e. Free of antibiotics and chemical residues.

Ultimate objective of any industry is to provide their customers with best quality product. Hence quality play important role in the procurement of milk .It is the biggest challenge for a company, as it affects cost, quantity, & competition. Increase quality, decrease quantity, increase cost & competition. At procurement stage in order to have good quality raw milk, company takes following steps:

1. Develop infrastructure •

Develop Centers

•

Install Chilling units

•

Develop Lab

•

Development of VMC

2. Staff Recruitment •

Recruit

•

Provision of Competitive salary

•

Train

•

Provision of necessary facility

3. Transportation system •

Tanker purchase

•

Vehicles purchase/rent

Cost: I. Before Set up •

Projection Cost

•

Set up / Capital cost

•

Running cost. 15

II. After collection starts

Landed Cost: Landed cost is the sum of following three costs : •

Variable

•

Fix

•

Losses

Variable : 1.Raw milk Price 2. Ice / Chilling 3.Transportation cost; it includes Haulage cost

Fixed cost : 1. Procurement cost; includes salaries wages benefits 2. Utilities 3. Rents 4. Maintenance and repair 5. Weighing / measuring cost 6. Storage cost; it includes ice and chilling cost 7. Other miscellaneous cost; including quality cost and etc.

Fixed Cost on milk procurement can be reduced by increasing volume of milk. It can also be reduced by controlling losses and over heads.

Competition: Following types of competition exists in area for procurement of milk these competitions some time are beneficial for company and sometimes may be harmful for company. 1. Industry to industry 2. Producer to producer

16

Industry to industry competition: This kind of competition occurs between the industries through producers. Procurement staff of company plays an important role in this type of competition due to their relations & behavior towards the producers. More such kind of competition is beneficial for the producers. This kind of competition results into following: •

Increase cost

•

Decrease quality

•

Increase quantity with each industry

Producers to producer’s competition: This kind of competition occurs between the producers through companies. More such kind of competition is beneficial for the industries & may results into following: •

Increase quantity

•

Increase quality

•

Decrease price

MILK PROCUREMENT TYPES: Milk Procurement is the starting point of dairy industry supply chain. The procurement process starts on the farm, where producers are advised, quality is monitored and raw milk is collected daily from various Farmers/progressive farmers by mini-suppliers and village milk collection centers countrywide and transported to factories in the most cost-effective manner. Raw milk quality is the cornerstone of excellent dairy products. Milk Procurement guards this quality with an eagle eye and ensures that company’s production needs are met. Through teamwork within the supply chain, procurement teams of companies ensure that raw milk losses are kept to the absolute minimum. Milk procurement is basically of two types : 1. Supplier’s collection 2. Self collection 1. Supplier Milk collection system: In this case supplier brings milk with their own sources at factory. The milk is scrutinized by quality assurance department of dairy as 17

per their standards. If milk pass all the quality test then this milk is received otherwise the milk is rejected.

Mini/Hilux contractor: In this type of milk collection local supplier of area, collects milk with their own resources and bring this milk to companies sub center. If milk is according to company’s standard that milk is received otherwise rejected. All types of collected milk are brought to sub centers, where it is chilled (by chiller or by ice) and transported to Main center either through 1.7, 5 or 9 tons of tankers depending upon the quantity of milk, here milk is chilled through chillers and transported to plant. 2. Self Milk collection system: image

A. Village Milk Collection (VMC): In this case a local community nominated person (VMC agent) collect milk from local farmers on behalf of company by using company facilities. The VMC agent gets commission from company on per litter collected milk. After collection VMC agent either himself approach the nearby center of company for handing over of collected milk or company vehicle collect milk from that VMC agent as per written agreement. Very good quality milk is collected through the VMCs. No doodhi is involved in this type of collection. B. Progressive formers: Having 10 adult buffalo or minimum 25 liters milk. C. Direct Farmer: Having one or more milch animal and bring milk directly to sub center or MCC (Milk chilling center)

Bulk milk transport: A Milk procurement team of companies ensures that milk is collected and transported to factories daily. Milk cooled on the farm or cooling centre may be transported in bulk tankers. Bulk tankers are insulated, so the milk will remain cold until it reaches the plant (provided the transport is fast, i.e. short distance or good roads enabling milk to be delivered before the temperature of milk rises above 10*C

18

Reception of milk at plant: At reaching plant quality assurance staff of reception lab takes the representative sample of whole milk tanker and analyses it for various parameters as per standards of company. If milk found as per quality norms of company the tanker is weighed and production department staff receive the milk for further processing otherwise the sub standards raw milk tanker is rejected.

MILK PROCUREMENT SYSTEM (MPS): The primary function of any Milk Procurement System (MPS) is to expedite dairy milk producer’s payroll process. This is accomplished using a complex system that documents the pickup, testing, delivery of milk, and issues payment to producers of milk and those responsible for its transport. In addition to tracing the movement of milk as it is picked up, tested, and transported to the plant, the Milk Procurement System issues checks and records financial information for producers, haulers, and vendors. MPS facilitates the dairy’s milk producer payroll process from beginning to end. ROLE OF MPD OF ANY COMPANY IN MILK PROCUREMENT: Milk procurement department of any company provides a value-added service to all their milk producers, ensuring that milk of the correct quality is produced and that sufficient raw milk is always available to satisfy company’s needs, through the use of strategies, processes, projects, systems and policy. Procurement teams of companies manage a number of Milk Procurement responsibilities including: 1. Ensuring that the producers are paid promptly and accurately. 2. Purchasing raw milk from producers and transporting it to factories effectively and efficiently. 3. Successful clean milk route development in various new identified areas. 4. Installation of bulk coolers in the area. 5. Milk yield improved. 6. Hygiene practices improvement at all levels of milk production and procurement 7. Reduction of Bacterial Count of milk. 8. Advanced training to drivers in the handling of mass milk in case of emergencies. 9. Trainings to field staff for handling of sample and client. 19

2. PACKAGING OF DAIRY PRODUCTS Dairy packaging requires special care and attention. Different dairy products have different packaging options. But one important factor to consider is to maintain the freshness of the product. Dairy packaging manufacturers and suppliers have come up with wide range of films, bags, laminates and equipment for packaging bulk dairy products, as well as, consumer portioned items, by considering factors like protecting the flavors and textures throughout display and distribution.

Most of the dairy product packaging is done in the paper based packing material. The paper can be wax coated paper, plastic coated paper, grease proof paper, box boards and other kind of dairy product packing paper. Then glass bottles are used as dairy product packaging as these are easy to clean and almost inert to chemicals.

Apart from these there are aluminum foils, tin plates, timber, plastics, low and high polymers that are used as dairy packaging material. Types of Dairy Products •

Milk: Powdered and Liquid

•

Fermented Milk

•

Whey Based Drinks

•

Curds

•

Cheese

•

Cottage Cheese

•

Cream

•

Butter etc.

Branding in Dairy Packaging Packaging is an integral part of the brand identity. The packaging of any dairy product should deliver consumer expectations of natural dairy taste and freshness, and should have a unique natural appeal and should extended shelf life. Dairy packaging has three main functions to perform: 20

•

To contain the product

•

To protect the product

•

To sell the product

Types of Dairy Packaging •

Pouch/Sachet: The pouch or sachets are formed from either a reeled or flat film.

UV light may be used to sterilize the film. This type of dairy packaging is used to package butter, cheese, milk powder etc. •

Carton: It plays a very important role in the bulk packaging of milk. It is used for

liquid, frozen and coagulated milk products. It is mainly available as preformed containers or as precut blanks or sheets ready to be formed into containers. •

Packet: Usually made of plastic, it is used to keep pasteurized liquid milk.

•

Barrel: Barrels are usually made of wood and are coated with wax on the inside.

They are used for bulk packaging of semi-solid buttermilk, sweetened condensed milk, etc. •

Cup: Cups are made up of paper with plastic or wax coating on inner surface. This

type of dairy packaging is usually covered with a lid and used for frozen and coagulated products. •

Cans: This is popularly used for various types of solid, semi-solid and powdered

products. Aluminum cans widely used. They are the most convenient for gas packing and suitable for dairy packaging. •

Bottles: Made of glass with aluminum closures, the bottles are suitable for storing

milk shakes and liquid stuffs. •

Collapsible Tube: It is used for packaging semi-fluid products like sweetened

condensed milk, processed cheese spread etc. It is usually made up of aluminum and lacquered on the inner side.

Types of Materials Used in Making Dairy Packaging •

Metalized plastic films

•

PVDC coated films

•

Plastic 21

•

Paper

•

Nylon

•

LDPE

•

Laminates

•

Polyolefin

•

Polypropylene

•

LDPE polyethylene

•

LLDPE polyethylene etc.

The milk chilling/dairy industry is one of the more intricate and diverse, and it requires refrigeration and temperature controls that are reliable throughout all its aspects. Refrigeration is needed in the production and storage of a wide range of products from milk, cheese and butter.

And, refrigeration is a vital aspect in new product development. In addition, proper refrigeration is needed to meet hygienic and government standards, the delivery of an attractive dairy product to consumers, and energy consumption demands of the refrigeration plant. Recommended Compressor: MX-Series Single Stage Application parameter Models Compressor speed RPM Milk Chilling Capacity per day in Liters Electric motor required

Compressor speed RPM

Request for Quotation MX100 MX200 MX300 MX400 MX600 MX900 750

750

750

750

750

750

27500

55000

82500

110000

165000

247500

KW

19

37

55

75

110

170

HP

25

50

75

100

150

225

850

850

850

850

850

850

22

Milk Chilling Capacity per day in Liters Electric Motor required

31000

62700

93500

125400

187000

280500

KW

22.5

45

67

90

125

190

HP

30

60

90

120

170

250

Note : Evaporating Temperature Condensing Temperature Temperature of incoming milk Temperature of milk after chilling Duration for which ice is built in the Ice Bank Tank Refrigerant The above data is for general guidelines only.

: : : : :

-10oC +40oC +35oC +4oC 18 Hrs

:

Ammonia

The above data is for general guidelines only.

3. DISTRIBUTION TRANSPORT MANAGEMENT SYSTEM A Transportation Management System (TMS) is a software system designed to manage transportation operations. TMS are one of the systems managing the supply chain. They belong to a sub-group called Supply chain execution (SCE). TMS, whether it is part of an Enterprise Level ERP System or from an integrated "Best of Breed" Independent Software Vendor(ISV) has become a critical part of any (SCE) Supply Chain Execution and Collaboration System in which real time exchange of information with other SCE modules has become mission critical. In more recent times, we have seen that these systems are being offered in many different types of licensing arrangements. These different arrangements have given shippers who otherwise would not be able to afford sophisticated software the opportunity to utilize TMS to better manage this vital function. The 3 primary offerings are: 23

•

1. On-Premise Licensing (traditional purchased license)

•

2. Hosted (remote)

•

3. On-Premise Hosted Licensing (a blend of 1 & 2)

Additionally, we are seeing that some software providers have either been acquired or merged with traditional supply chain management consultancies and are now offering shippers "blended" managed and software services as an outsourced process. Primary Tier 1 TMS providers are still independent, carrier and 3PL neutral, and ERP neutral. TMS usually "sits" between

an

ERP

or

legacy order

processing and

warehouse/distribution module. A typical scenario would include both inbound (procurement) and outbound (shipping) orders to be evaluated by the TMS Planning Module offering the user various suggested routing solutions. These solutions are evaluated by the user for reasonableness and are passed along to the transportation provider analysis module to select the best mode and least cost provider. Once the best provider is selected, the solution typically generates electronic load tendering and track/trace to execute the optimized shipment with the selected carrier, and later to support freight audit and payment (settlement process). Links back to ERP systems (after orders turned into optimal shipments), and sometimes secondarily to WMS programs also linked to ERP are also common. Most TMS systems help shipper directly work with asset-based carriers and support dis-intermediation (including avoiding use of non-asset based brokers and other intermediaries). Transportation Management Systems manage three key processes of transportation management: •

1. Planning and Decision Making: TMS will define the most efficient transport

schemes according to given parameters, which have a lower or higher importance according to the user policy: transport cost, shorter lead-time, fewer stops possible to insure quality, flows regrouping coefficient… •

2. Transport follow-up

TMS will allow following any physical or administrative operation regarding transportation: traceability of transport event by event (shipping from A, arrival at B, customs clearance…), editing of reception, custom clearance, invoicing and booking documents, sending of transport alerts (delay, accident, non-forecast stops…) 24

•

3. Measurement

TMS have or need to have a Logistics KPI reporting function for transport. Various functions of a TMS: •

Planning and optimizing of terrestrial transport rounds

•

Transportation mode and carrier selection

•

Management of air and maritime transport

•

Real time vehicles tracking

•

Service quality control

•

Vehicle Load and Route optimization

•

Transport costs and scheme simulation

•

Shipment batching of orders

•

Cost control, KPI (Key performance indicators) reporting and statistics

o

Typical KPIs include but not limited to:

1. % of On Time Pick Up or Delivery Performance relative to requested 2. Cost Per Metric - mile; km; Weight; Cube; Pallet

Key Benefits Route Planning and Optimization •

Reduce Distribution Costs & Fleet Miles - Daily routes are created using powerful

algorithms and street-level routing, in conjunction with your business constraints •

Increase Resource Utilization-Make better use of existing resources by delivering

more and driving less. The answer to increasing volume is not always to put more vehicles on the road, but to make smart, efficient •

Make Sound Business Decisions -Understand how delivery costs affect the

profitability of each customer by knowing the actual cost per stop •

Set Driver Standards - Creating route plans and gathering actual information

allows you to set performance standards and expectations-which can result in less overtime and better driver performance •

Decrease Routing Time - Let your routers spend less time configuring routes and

more time assessing what-if scenarios to produce better, more efficient routes.

25

•

Contingency Planning - Prepare for holiday or seasonal spikes and other "what if"

scenarios •

Reports - Driver manifests, maps, directions, resource utilization, customer

delivery cost, actual versus projected by route and by stop, planned route summaries and many more reports to help you consistently evaluate your success Load Optimization •

Accurate and Quick Load Design for Multiple Route Types - Each type of route

requires different loading patterns. Determine (or assign) equipment to warehouse bays with capacities, preferences or even empty bays for returned goods •

Multiple Loading Strategies - Different delivery operations require different

loading strategies. Our warehouse-friendly software allows for greater picking efficiencies by grouping SKUs. Driver-friendly groups product by stop, minimizing the number of bays a driver must visit at each stop •

Pre-Build Orders - Load orders to be picked, built and pre-staged throughout the

day, all while continuing to have them allocated to the correct route and truck during the final loading pass •

Load Design to Reduce Product Breakage - Most breakage occurs within the first

10 minutes of a route due to poor packing. Fleet Loader's leading loading algorithms allow for proper mixing and stacking to reduce breakage •

Reports - Final load sheet, driver check-out, load validation and pick sheets

provide you with all of the detailed information you need

26

CHAPTER 4 LITERATURE REVIEW Today Consumers have higher expectations than ever before. They want products to match these expectations. They also want accurate, up-to-date and useful information about what they buy and above all they need Quality

According to the report of Sumit Kukreja, a management trainee from Amity University, food and beverages are the one of the largest growing trade in FMCG sector and ice-cream is the pathfinder of this trade. The continues grow in the demand of icecream in India is showing the great opportunity in future.

According to the project work done by the management students Swati Kiran & Kriti Tiwari of IMT Ghaziabaad on AMUL, the growth rate of dairy foods due to better supply chain management practices and strong distribution network in India is steady but is increasing in the future.

India is the largest milk producer in the world, yet only around 15 per cent of the milk is processed. The organized liquid milk business is in its infancy and also has large long-term growth potential.

.

27

CHAPTER 5 REASEARCH METHODOLOGY SAMPLING METHOD

Convenience sampling was used by the researcher because it is easy and cheap to collect data. Moreover the population size was very large to cover so it was best to use convenience sampling.

DATA COLLECTION

Both Primary as well as Secondary Research Method has been included for preparing this final report.

PRIMARY SOURCE •

Observation

•

Personal Interviews

OBSERVATIONS - It is the methods of nothing and recording information without asking specific question from the respondents. The advantage of this method is that it is highly effective to provide information asked for.

PERSONAL INTERVIEWS - In this method I asks the question from the performa in the order questions are listed and record the replies.

SECONDARY SOURCE •

Google search engine.

•

Other web links. 28

CHAPTER 6

DATA ANALYSIS AND INTERPRETATION 1.

How do you manage your supply chain? Close partnership with suppliers JIT supply Outsourcing Many suppliers Holding safety stock No. of Respondent

Close partnership with suppliers 2 JIT supply

1

Outsourcing

3

Many suppliers

20

Holding safety stock

4

25

Axis Title

20 15 10 5 0

No. of Respondent

Close partnership with suppliers

JIT supply

Outsourcing

Many suppliers

Holding safety stock

2

1

3

20

4

Out of 30 employees of Dinshaw’s dairy food ltd maximum no. of employees think that supply chain management of Dinshaw’s dairy food ltd is managed by many suppliers.

29

2. How successful do you think is your company in managing its supply chain in general? * Not successful at all * Not successful * Somewhat successful * Successful * Very successful No. of respondent 0

Not successful at all Not successful Somewhat successful Successful Very successful

0 4 20 6 25

Axis Title

20 15 10 5 0 Not successful at all

Not successful

Somewhat successful

Successful

Very successful

0

0

4

20

6

No. of respondent

Most of the employees think that Dinshaw’s dairy food ltd is managing Supply Chain Management successfully.

30

3. Does your company have a separate logistics department? YES Yes No

NO No. of respondent 30 0

0%

Yes No

100%

The company has a separate logistic department.

31

4. Does your company have a clear logistics strategic plan? YES Yes No

NO No. of respondent 28 2

7%

Yes No

93%

Out of 30 employees 28 think that Dinshaw’s dairy food ltd has a clear logistic plan.

32

5. What types of systems are currently in use in your company to support Supply Chain Management? Subcontracting 3PL Supply Chain Benchmarking Vertical integration

No. of Respondent Subcontracting

5

3PL

3

Supply Chain Benchmarking

19

Vertical integration

2

20 18 16 Axis Title

14 12 10 8 6 4 2 0

No. of Respondent

Subcontracting

3PL

Supply Chain Benchmarking

Vertical integration

5

3

19

2

Out of 30 employee 19 think that supply chain benchmarking supports supply chain management of Dinshaw’s dairy food ltd.

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6. What types of systems do you plan to implement in the near future (within the next 2 years)?

E-procurement EDI Outsourcing Subcontracting Plan strategically

No. of Respondent E-procurement

13

EDI

7

Outsourcing

1

Subcontracting

4

Plan strategically 5

14 12 Axis Title

10 8 6 4 2 0

No. of Respondent

Eprocurement

EDI

Outsourcing

Subcontractin g

Plan strategically

13

7

1

4

5

Out of 30 employees 13 employees think that in future there is need of implementing e-procurement. procurement.

34

7. How satisfied are you with the current public policy regarding SCM and IT? *Satisfied *Very satisfied *Same what satisfied *Not satisfied Satisfied Very satisfied Same what satisfied Not satisfied

No. of respondent 20 5 2 1

25

Axis Title

20 15 10 5 0

No. of respondent

Satisfied

Very satisfied

Same what satisfied

Not satisfied

20

5

2

1

Out of 30 employees of Dinshaw’s dairy foods ltd. 20 employees are satisfied.

35

8. Is supply chain management having all the address of the sub distributor’s branches of the company? Yes Yes No

No No. of respondent 27 3

10%

Yes No

90%

Out of 30 employees 27 of Dinshaw’s dairy foods ltd. knows nows the address of the sub distributors.

36

9. Rate the working strategies of supply chain management department on the basis of the current programs? * Outstanding * Excellent * Good * Average No. of respondent 2 8 2 18

Outstanding Excellent Good Average 20 18 16

Axis Title

14 12 10 8 6 4 2 0 No. of respondent

Outstanding

Excellent

Good

Average

2

8

2

18

Out of 30 employees 18 employees think that the working strategies of supply chain management department are average.

37

10. Is the supply chain management department is having sufficient transportation? * Yes * Not sufficient No. of respondent Yes

25

Not sufficient

5

17%

Yes Not sufficient

83%

Out of 30 employees 25 think that transportation is sufficient for Dinshaw’s dairy foods ltd.

38

11. According to the current growth process of the organization, which of the following needs much attention and progress to boost the production? * Operational activities * Tactical activities * Current programming strategies No. of respondent 25 3 2

Operational activities Tactical activities Current programming strategies 30 25 Axis Title

20 15 10 5 0 Operational activities No. of respondent

25

Tactical activities

Current programming strategies

3

2

Out of 30 employees 25 think that there is a need to pay attention on operational activities.

39

12. Choose the right option, where the supply chain department is facing problem in taking care of the raw material? * During storage * Packaging * Testing of packaging * Evaluation of defective raw material During storage Packaging Testing of packaging Evaluation of defective raw material

No. of respondent 15 5 1 9

16 14

Axis Title

12 10 8 6 4 2 0

No. of respondent

During storage

Packaging

Testing of packaging

Evaluation of defective raw material

15

5

1

9

Out of 30 employees 15 employees think that supply chain management is facing problem during storage.

40

13. How do you rate the delivery activity of the department? * Excellent * Very effective * Good * Average

Excellent Very effective Good Average

No. of respondent 3 5 13 9 14 12

Axis Title

10 8 6 4 2 0 Excellent No. of respondent

Very effective

3

5

Good

Average

13

9

Out of 30 employees 13 employees says that delivery system is very good.

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14. Is there any case recorded by the supply chain department in which the production department complained late delivery of raw materials? * Yes * No No. of respondent Yes

4

No

26

13%

Yes No

87%

Out of 30 employees 4 employees complained about the late delivery of raw material.

42

CHAPTER 7 CONCLUSION According to the study done on the feedback of questionnaire, data interpretation and analysis the results are as followsThe result shows that the Dinshaw’s dairy foods ltd. practices supply chain with the help of many suppliers. Meanwhile the company is managing its supply chain successfully. The company has a separate logistics and dispatch department. Dinshaw’s dairy foods ltd has a clear and sophisticated logistic plan. Operational activities and supply chain management activities of the Dinshaw’s dairy foods ltd are by the support of supply chain benchmarking. The company is planning to implement and practice the e-procurement, EDI plan strategically in future. Current supply chain management and IT activities of the company are going flawless and in future there is scope for better supply chain and distribution network. The current transportation and logistics management of the company is sufficient and is flexible enough so as to change the current policies if any. The study has shown us that there is some obstacles during handling and storage of dairy products which creates hurdle in SCM therefore should be eradicated.

43

LIMITATIONS OF THE STUDY •

This study throws light on supply chain management process commenced at the Dinshaw’s dairy foods ltd. Butibori MIDC Nagpur.

•

The SCM studied in this report focuses on the dairy industry of Nagpur and it may differ from firm to firm.

•

The disadvantage of study SCM is investment of time, money and resources needed to implement and overlook supply chain.

•

Dinshaw`s ice cream has no homepage.

•

Convenience sampling used here has its own limitations.

•

There have been some inaccuracies due to non – cooperative and rude behavior of the respondents.

44

CHAPTER 8 SUGGESTIONS •

The company should start a home delivery where a particular household will order full range of products required by it over a period of time. For this the company could provide a deliveryman with cycle to reach the different houses.

•

In order to motivate the channel members it is also very essential for the company to increase the distributors for the hard selling items e.g. Dinshaw’s dahi (curd) where it faces competition from Haldiram & Amul.

•

Dinshaw’s should go in for exclusive outlets in at least all the shopping malls coming up these days and any location where footfalls are large in number. The advantages of this channel will be: i. Full range display ii. Convenience for distributors. iii. Easier to access new customers. iv. Easy to push impulse purchase products v. Brand building will be facilitated

•

In order to remain sensitive to market demand, it is essential for the company to have additional procurement options ready that will help company to cope up with the problem of less supply or shortage of raw milk.

•

In order to practice a better supply chain management Dinshaw’s should make use of updated/upgraded/latest ERP packages like MFG PRO

•

Distribution strategies.

There are two main distribution strategies, which Dinshaw’s has very effectively used. 1. In first strategy include incentives like free deep freezers, discounts on bulk purchases.lr

45

2. Advertising campaign that reminds and persuades customers to buy ice cream supports 2nd strategy, Which is facilitated by price offs, which are frequently offered by the company. •

Route planning and optimization

•

Load optimization

•

For the dairies to remain competitive, they need to diversify their products through value addition by using simple and cost-effective methods of processing milk. Consideration should be given to processing of storable products such as ghee and cheese as these are processed and successfully supplied and distributed by dairies in other areas of India. The dairies need to establish strategically positioned milk collection centers with cold storage facilities to increase the quantity of milk they handle.

46

ANNEXURE 1 BIBLOGRAPHY Books •

James Evans, Supply chain management, Tata McGraw hills 3rd edition p.n. 405 to 450

•

Alberta Russel,Supply chain management, Wiley publication, 1st edition p.n. 1 to 50.

•

John T. Mentzer ,Supply chain management Tata McGraw hills 4th edition p.n. 65 to 90

•

Harland ,C.M.(1996) Supply Chain Management, Purchasing & Supply Chain Management, Logistics, Vertical Integration, Material Management & Supply Chain Dynamics. Excel books, p.n. 354 to 370.

•

Operations management along with supply chain management by Russell and Taylor.

•

Upendra Kachru, Exploring the supply chain theory and practices, Tata McGraw hills,p.n.210 to 250.

Websites•

www.wikipedia .org

•

En.wikipedia.com.au/glossary.asp

•

http://www.scribed.com

•

http://www.google.com

47

ANNEXURE 2 QUESTIONNAIRE Name of Employee

: ……………………………………………………………….

Name of Company

:……………………………………………………………….

Address

:………………………………………………………………. ……………………………………………………………….

Country

:…………………

Tel.

:

Contact Person

:……………………………………

……………………….

Position in company :…………………………………… E-Mail

:……………………………………

Sector Types

: Manufacturing

Industry

: Food

No of Employees

:

Service Automotive

Both Other (define)

Turnover 2010 :

1.How do you manage your supply chain? Close partnership with suppliers JIT supply Outsourcing Many suppliers Holding safety stock 2. How successful do you think is your company in managing its supply chain in general? * Not successful at all * Not successful * Somewhat successful * Successful * Very successful 3. Does your company have a separate logistics department? NO

YES

4. Does your company have a clear logistics strategic plan? YES

NO

48

5.What types of systems are currently in use in your company to support Supply Chain Management? Subcontracting 3PL Supply Chain Benchmarking Vertical integration 6. What types of systems do you plan to implement in the near future (within the next 2 years)? E-procurement EDI Outsourcing Subcontracting Plan strategically 7. How satisfied are you with the current public policy regarding SCM and IT? *Satisfied *Very satisfied *Same what satisfied Not satisfied 8. Is supply chain management having all the address of the developer branches of the company? Yes

No

9. Rate the working strategies of supply chain management department on the basis of the current programs? * Outstanding * Excellent * Good * Average 10. Is the supply chain management department is having sufficient transportation? * Yes * Not sufficient

49

11. According to the current growth process of the organization, which of the following needs much attention and progress to boost the production? * Operational activities * Tactical activities * Current programming strategies

12. Choose the right option, where the supply chain department is facing problem in taking care of the raw material? * During storage * Packaging * Testing of packaging * Evaluation of defective raw material 13. How do you rate the delivery activity of the department? * Excellent * Very effective * Good * Average 14. Is there any case recorded by the supply chain department in which the production department complained late delivery of raw materials? * Yes * No

50