SCM Assignment

AN ANALYSIS OF SUPPLY CHAIN
MANAGEMENT PROCESS OF
PRAN FOODS LIMITED
Submitted to –
Dr. Mahbub Alam
Course Instructor: Principles of Supply Chain Management (SCM 501)
MBA Department
Submitted by –
 Sayeed Sami
Id – 16306004
 Kazi Anamul Hasan

Id – 16306012
 S. M. Fawzul Kabir
Id – 16306020
07/04/2017
University of Asia Pacific (UAP)
Dhaka, Bangladesh
An Analysis of Supply Chain Management Process of PRAN Foods Limited
Letter of Transmittal
7th April, 2017
Dr. Mahbub Alam
Course Instructor,
Principles of Supply Chain Management,
MBA Program,
Department of Business Administration,
University of Asia Pacific (UAP).
Subject: Submission of term paper on “An Analysis of Supply Chain Management

Process PRAN Foods Limited”.
Dear Sir,
Here is the term paper that we have been assigned on the topic as per your request. The term
paper has been completed by the knowledge that we have gathered from the course “Principles
of Supply Chain Management”.
We are thankful to all those persons who provided us important information and gave us
valuable advices. We would be happy if you read the paper carefully and we will be trying to
answer all the questions that you have about the term paper.
We have tried our level best to complete this term paper meaningfully and correctly, as much
as possible. We do believe that our tiresome effort will help you to get ahead with this sort of
venture. In this case it will be meaningful to us. However, if you need any assistance in
interpreting this term paper please contact us without any kind of hesitation.
Thanking you.
Yours obediently,
Sayeed Sami (Id – 16306004)
Kazi Anamul Hasan (Id – 16306012)
S. M. Fawzul Kabir (Id – 16306020)
1
Acknowledgement
In performing our term paper, we had to take the help and guideline of some respected persons,
who deserve our greatest gratitude. The completion of this term paper gives us much pleasure.
We would like to show our gratitude to Mr. Dr. Mahbub Alam, Course Instructor of
Principles of Supply Chain Management, University of Asia Pacific (UAP) for giving us a
good guideline for the term paper through numerous class lectures. We would also like to
expand our deepest gratitude to all those who have directly and indirectly guided us in writing
this term paper.
Many people, especially our classmates and team members itself, have made valuable
comments and suggestions on this proposal which gave us an inspiration to improve our term
paper. We thank all the people for their help directly and indirectly to complete our term paper.
Sayeed Sami
S. M. Fawzul Kabir
Kazi Anamul Hasan
2
Table of Contents
Letter of Transmittal .......................................................................................................................................1
Acknowledgement ..........................................................................................................................................2
Table of Figures ...............................................................................................................................................5
Executive Summary.........................................................................................................................................6
Chapter # 1: Introduction & Company Review
Company Review ............................................................................................................................................8
PRAN's Inception.............................................................................................................................................9
PRAN's Mission & Vision .................................................................................................................................9
PRAN's Slogan .............................................................................................................................................9
PRAN's Mission ...........................................................................................................................................9
PRAN's Vision ..............................................................................................................................................9
PRAN's Corporate Values ..............................................................................................................................10
Consumer Care .........................................................................................................................................10
Supplier Care.............................................................................................................................................11
Employee Care ..........................................................................................................................................11
Trade Care.................................................................................................................................................11
PRAN's Products............................................................................................................................................12
Export Profile of PRAN ..................................................................................................................................13
Corporate Social Responsibility ....................................................................................................................14
Promises to the Environment ...................................................................................................................15
Community Forestation ........................................................................................................................15
Effluent Treatment Plant (ETP) .............................................................................................................15
Heat Recovery Boiler ............................................................................................................................16
Promises to the Energy Preservation........................................................................................................16
PRAN’s Uses for Energy Preservation: ..................................................................................................16
Promises to the People .............................................................................................................................16
To Consumer .........................................................................................................................................16
To Employee: ........................................................................................................................................16
Promises to the Community .....................................................................................................................17
Dairy Development ...............................................................................................................................17
Education Development .......................................................................................................................17
Other Social Support .............................................................................................................................17
3
Chapter # 2: Supply Process of PRAN Foods Limited

Supply Chain Steps of PRAN Foods Limited ..................................................................................................19
Supply Chain Planning...................................................................................................................................20
Demand Forecasting .....................................................................................................................................21
Procurement .................................................................................................................................................22
Logistics .........................................................................................................................................................23
Manufacturing ..............................................................................................................................................24
Distribution ...................................................................................................................................................24
The Total Supply Chain Process of PRAN Foods Limited ..............................................................................26
Chapter # 3: Recommendations & Conclusions
Recommendations ........................................................................................................................................28
Conclusions ...................................................................................................................................................29
Bibliography
Bibliography ..................................................................................................................................................31
4
Table of Figures
FIGURE 1: SUPPLY CHAIN PHASES OF PRAN FOOD LIMITED ............................................................................. 19
FIGURE 2: STRUCTURAL FLOW OF PARTIES INVOLVED IN THE SUPPLY CHAIN PROCESS OF PRAN FOODS LIMITED ....... 20
FIGURE 3: PROCUREMENT FLOWCHART OF PRAN FOODS LIMITED .................................................................... 22
FIGURE 4: DISTRIBUTION FLOWCHART OF PRAN FOODS LIMITED...................................................................... 25
FIGURE 5: TOTAL SUPPLY CHAIN PROCESS OF PRAN FOODS LIMITED ................................................................ 26
5
Executive Summary
This term paper is a part of continuous assessment of our course “Principles of Supply Chain
Management”. The topic of this term paper is “An Analysis of Supply Chain Management
Process of PRAN Foods Limited”. This term paper will describe the supply chain process of
PRAN Foods Limited. PRAN Foods Limited is one of the biggest food products
manufacturer in Bangladesh. This company is not only big in terms of manufacturing
capacity but also it has one of the longest product range in Bangladesh. PRAN Foods Limited
is very successful in exporting food products in many foreign countries including EU
countries, Middle Eastern countries and many parts of the world. PRAN has a very
established market in Middle East where the Bangladeshi people living there get the products
conveniently. PRAN distribution channel works there very effectively. PRAN Foods Limited
being a very well established and successful company as well as a leading market giant in
Bangladesh employs very effective and efficient supply chain practices. However, this term
paper primarily deals with supply chain process of PRAN Foods Limited, how PRAN uses
and employs its procurement, logistics, manufacturing, distribution and other strategies. The
sequential aspect of supply chain of PRAN Foods Limited and the parties involved in
different stages of supply chain of PRAN are described in this term paper. At the end of the
term paper the recommendations and conclusions on the supply chain management process of
PRAN Foods Limited is mentioned.
6
Chapter # 1:
Introduction
&
Company
Review
7
Supply Chain Management (SCM) is a very important element of an organization all over the
world. It is been noticed that, supply chain strategy and policy is thought of as the driving force
and the means of competitive advantage of the successful firms all over the world. HP, Dell,
Apple all these are highly successful by efficiently and effectively employing unique supply
chain system. This is why supply chain management has become a very important part of
business in now-a-days.
Like any other country, in Bangladesh, the field of Supply Chain Management (SCM) has also
spread. For our assignment purpose we have selected “PRAN Foods Ltd.” as our designated
company of which supply chain process will be elucidated.
First, we will talk about the company.
Company Review
‘PRAN’ has started its operation in 1981 as a processors fruit and vegetable in Bangladesh.
Over the years, the company has not only grown in stature but also contributed significantly to
the overall socio-economic development of the country.
“PRAN” is currently one of the most admired food & beverages brands among the millions of
people of Bangladesh and other 134 countries of the world where PRAN Products are regularly
being exported.
All the PRAN products are produced as per international standards maintaining highest level
of quality at every stages of its production process.
PRAN is currently producing more than 400 food products under 10 different categories i.e.
Juices, Drinks, Mineral Water, Bakery, Carbonated beverages, Snacks, Culinary,
Confectionery, Biscuits & Dairy. The company has adopted ISO 9001 as a guiding principle
of its management system. The company is compliant to HACCP & certified with HALAL
which ensures that only the best quality products are reaches to the consumers table across the
Globe.
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PRAN's Inception
We, Bangladeshi are blessed with a climate ideally suited to agriculture, specially fruits and
vegetables-rich in taste and flavour: sweet, mellow and juicy.
Our deltaic plains are among the most fertile in the world created and drained by the mighty
rivers-the Padma, Jamuna & Meghna. There is plenty of water and farming is a way of life to
our people.
Our comparative advantage as an economy lies in agriculture. We believe the way to economic
prosperity is through agro-business.
PRAN is in testimony to our convictions. It stands for: “Programme for Rural Advancement
Nationally”.
PRAN is Bangladesh’s largest grower and processor of fruits and vegetables. Our contract
growers cultivate the choosy fruits and vegetables which are processed in our modern and
hygienic factories to highest quality & international standards.
PRAN's Mission & Vision

PRAN's Slogan
Slogan: Poverty & Hunger are Curses.
PRAN's Mission
Mission: To generate employment and earn dignity & self-respect for our compatriots through
profitable enterprises.
PRAN's Vision
Vision: Improving Livelihood
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PRAN's Corporate Values

Consumer Care
We view our consumers as our king and we are their laypeople. Our consumers have given us
such success for so long years. So, we care about our consumers. Consumer care is the process
by which we endorse consumers’ satisfaction and moreover, loyalty. Primarily, it grips
managing communication with consumer particularly consumers’ questions and complaints
and resolving disputes amicably. Eventually the goal of our consumer care program is to build
long-term relationship. To meet this goal, we will go to great lengths to build a strong reputation
for lavishing our consumers with special services, discounts, gifts and other benefits.
It’s our great honour to communicate with our consumers. So, we humbly request our
consumers to feel free to communicate with us regarding following issues:
 Complaint for our products

 Price information
 Benefits of products
 Comments for products
 Any other issues
Objectives that we seek through our consumer care are:
 To create a culture of customer focus

 To receive complaints from our consumers on product related matters
 To achieve customer satisfaction
 To create rapport and loyalty
We provide the easiest way of communication as we care valuable time of our consumers.
Consumers can communicate with us through:
 Cell Phone: +88-01973-737777 (During 8 A.M. to 8 P.M.)

 Through our web mail
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Supplier Care
Our native farmer is our supplier. We collect major portions of our raw materials from them.
We give values to their activities. Most of our farmers were deprived of proper price for their
produces. We have been helping them to overcome this situation by practicing contract
farming. Now we are the pioneer and the largest contract manufacturer in Bangladesh. We care
our suppliers in the following ways:
 By providing them good seeds, fertilizers, insecticides etc.

 By providing financial supports.
 By providing proper information about what to produce more and what to produce less.
 By collecting their produces in right time and storing them.
 By collecting raw materials directly/right from them and saving them from middle men.
 By creating a huge demand of our farmers’ products both in nationally and globally.
 By ensuring proper price for their produces.
Employee Care
Our employees are our best resource. We give values to our employees’ creativity and
innovation. Our culture begins with our four values that drive everything we do: Integrity,
Continuous Innovation, Involvement and Self-respect. We help our employees’ growth. We
give them proper training and development. We encourage employees to ask questions and
make suggestions that they think better.
We are the one amongst the few in Bangladesh who has a culture of profit sharing management.
Our employees are dedicated to the success of our business. We treat our employees as a core
resource and family member.
Trade Care
Our trade partners are our great support. Through them, we reach to our ultimate consumers.
They provide support to our entire our promotional activities and merchandising program. We
care for our trade partner.
Now, we have a customer care wing to listen to them. We aim to build a strong long term
business relationship by taking them through the journey of relationship disposition funnel and
expect them to become our advocates in our Business.
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We care about their needs in the following ways:
 By giving product in right price, right quality, at right time and trade benefit.
 By giving them special service like upcoming demand trends.
 By giving them sample products.
 By giving them promotional sales competition.
 By giving product replacement opportunity for any damaged or expired product.
Moreover, at distributors business area, we arrange TRADE MEET where we give them proper
training about how to handle their demand and supply management in their area.
We have recently started PCC (PRAN Customer Care) where our trade partners can talk
directly by making phone call to a unique number: +88-01973-737777. We will support them
in the following ways:
 By listening to product complaints.

 By providing information about price of product.
 By giving information about address of dealer point.
 By giving proper solution for any unwanted situation associated to our business.
PRAN's Products
PRAN Foods Limited is a big company and for this it is difficult to describe the all the products
of PRAN Foods Limited. However, PRAN Foods Limited comprise a large variety of product
category. The product category of PRAN Foods Limited is listed below –
1. Juice
2. Drink
3. Mineral Water
4. Bakery (Cake & Bread)
5. Soft Drinks
6. Energy Drink
7. Pure Malted Beverage
8. Fried Snacks
9. Pallet Snacks
10. Chutney
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11. Basic Spice

12. Mix Spice
13. Mustard Oil
14. Pickle
15. Sauce, Ketchup & Paste
16. Jam & Jelly
17. Rice & Allied Products
18. Dal
19. Papadum
20. Honey
21. Noodles
22. Soup
23. Candy
24. Chocolate & Toffee
25. Chewing Gum
26. Lolli Pop
27. Edible Jell
28. Fruit Bar
29. Biscuits
30. UHT Pasteurised Milk
31. Fullcream Milk
32. Milk Drinks
33. Milk Allied Products
34. Health Food Drink
35. Breakfast and Refreshment
36. Rehydration
37. Frozen Food
38. Sunflower Oil
Export Profile of PRAN

PRAN, the largest exporter of processed food from Bangladesh, had a vision of creating a huge
demand globally of those agro based products produced by native farmers. The key was to
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process the agro products and increase shelf-life thereby. Starting successful journey to export
market since 1996, PRAN currently exports to over 134 countries.
In global market, we truly strive to exceed ourselves every year. Therefore, we are growing
like anything in whichever market we operate. To accelerate continuous growth, we already
set up a production plant in India and production has already been started.
In many countries, especially USA (NY), Australia, UAE, Saudi-Arabia, Qatar, India, Oman,
Malaysia, Singapore, Somalia we have got our own sales and distribution network equipped
with full-fledged office. With office, warehouse, distribution vehicles, sales force, & other
sophisticated supports, we are extremely aggressive to be the market leader in each and every
category we operate.
Last but not the least; along with existing presence in African, Asian & European markets, we
eagerly look forward to having a stronger and more vibrant presence in every corners of global
market.
For excellence in export market including product development, market development etc; we
have been awarded numerous trophies in home and abroad.
In recognition of contribution towards earning foreign currency, PRAN achieved “Best

National Export Award” for 8 consecutive fiscal years (FY 1999-2000, 2000-01, 2001-02,
2002-03, 2003-04, 2004-05, 2007-08, 2008-09, 2009-10, 2010-11). In recent times, PRAN is
awarded “UDC BUSINESS AWARDS 2011” as the best food & beverage products
manufacturer in Malaysia.
The awards are welcome but if there is one thing that truly inspires every member of PRAN
… it’s a vision to become the leading globally integrated agro based Food Company by
improving livelihood.
Corporate Social Responsibility

The idea of corporate social responsibility is being widely promoted all over the world and
rightly so. Here is a corporate whose corporate mission embodies in itself corporate social
responsibilities with the additional compulsion to make profits in order to thrive and grow
which it must to fulfil its corporate social responsibilities in greater measure as time passes.
14
PRAN has a bifocal objective of making profits through the fulfilment of corporate social
responsibilities.
PRAN-RFL is a concept: away to fight poverty & hunger in Bangladesh in the shortest
possible time through employment generation.
PRAN signifies investment in agro processing: creating demands for farm produce which
create jobs in rural areas also preventing urban migration. PRAN’s aim to add value to
agricultural harvest.
Bangladesh’s comparative advantage lies in creating a competitive edge in value added

agricultural products. This is what PRAN stands for.
The Group’s major achievement has been trying to consolidate fragmented land holdings and
organizing farmers into ‘contract growers’ of specific crops for consumption in PRAN’s major
processed products. With the elimination of the middlemen, farmers receive fare prices for
their products and due to technical assistance from the agro-processing industry; yields, quality
and income have risen considerably. Poverty alleviation through profitable enterprises is now
a reachable goal for many farmers. This resolution is perhaps PRAN’s greatest achievement.
We know that the success of our business relies on a healthy environment. We’re doing all we
can to be good a steward of our planet’s resources.
Our CSR effort revolves around the four premises i.e. Environment, Energy Preservation, and
Community & People to improve the quality of livelihood:
Promises to the Environment

Community Forestation
In different locations around Bangladesh, we are planting trees to save our GREEN
PLANET.
Effluent Treatment Plant (ETP)

To ensure safe disposal of factory wastage, we have got ETP’s in all the establishments of
our Group.
15
Heat Recovery Boiler

We recover the heat to save energy that we produce and utilize in our production facilities
in all locations.
Promises to the Energy Preservation

PRAN’s Uses for Energy Preservation:
 SKY-Light Roof to utilize daylight during factory operation.
 CFL Bulbs at our Factories and offices to reduce Power Consumption
 Powered Trucks to reduce Air Pollution and usage fossil fuel for all vehicles.
Promises to the People

To Consumer
We care for our consumers’ need and satisfaction. Through our communication activities, we
let our consumer know about the benefits of our products and innovations. Our approach is to
do responsible marketing and have four clearly defined principles that guide our
communications:
1. We aim at building trust through clear communication.

2. We fully support consumers’ right to know what is in our products and we are
transparent in terms of ingredients. We provide clear communication about our product
ingredients, date of expire, nutrition values, etc.
3. We support our consumers by listening their suggestion, claims or feedback through
use of a combination of channels which include websites and care line phone numbers,
etc. to reduce any kind of misconception.
4. We provide clear price communication.
To Employee:
 Equal opportunities are given to both male and female candidates irrespective of race,
religions, culture etc.
 Selection is done based on merits and qualifications. Everyone has got clear-cut job
descriptions and got equal opportunity to contribute and share their ideas and thoughts
to grow in the company.
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 Employees are rewarded with salary, commission and incentives as per standards.
Workers and staffs are provided with free and subsidized food from the factory and
office cafeterias.
 Employees’ health and hygiene are taken out most care with full time adequate numbers
of Doctors, nurses and other medical supports.
 To develop the human skills, both on the jobs and off the jobs trainings are constantly
being provided to all the workers and staffs.
Promises to the Community

Dairy Development
To develop the dairy industry in Bangladesh, PRAN has started Dairy Hub operations
in Bangladesh at its own cost where we are organizing farmers, counselling for raring
of dairy and providing cattle food, Artificial Insemination and other veterinary support
to the farmers to increase the dairy yields.
Education Development
PRAN is promoting education and supporting several schools in their operations
improving the salary of the teachers and staffs, providing books, arranging special
coaching for the students.
Other Social Support

 Helping Mosque, Temple and Churches.
 Working together with Red Crescent.
 Collecting and donating blood.
 Working for the disabled.
 Working with ‘SAVE THE CHILDREN’.
 Helping the community in natural calamities.
 Providing Airport Support for the Hajj Pilgrims every year from Bangladesh to KSA.
We are a business entity. We care for the Environment, Natural resources,

community and for the employee who works with us. We feel, we are doing
well to the society while running our business profitably.
17
Chapter # 2:
Supply Chain
Process of
PRAN Foods
Limited
18
PRAN Foods Limited is a renowned company in Bangladesh. Supply Chain Management

Policy and Process plays a vital role in the operation of its business. PRAN Foods Limited
represents a usual food manufacturer's supply chain process. In the process of describing the
supply chain process of PRAN Foods Limited, we will first elucidate steps of supply chain
process of PRAN Foods Limited, then describe each steps and we will illustrate the total supply
chain process in a flowchart with planning, demand forecasting, sourcing, manufacturing,
distribution and with its internal steps.
Supply Chain Steps of PRAN Foods Limited

The supply chain steps of PRAN Foods Limited is consists of Supply Chain Planning, Demand
Forecasting, Sourcing, Manufacturing and Distribution phases. The Supply Chain Phases of
PRAN Foods Limited looks like the following flowchart –
Supply Chain
Planning
Demand
Forecasting
Procurement
Logistics Operation
(In-Bound)
Manufacturing
Logistics Operation
(Out-Bound)
Distribution
Figure 1: Supply Chain Phases of PRAN Food Limited
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Supply Chain Planning

In the Supply Chain Planning Phase, the planning department along with Supply Chain
Management (SCM) department, Procurement department, Operations department, Marketing,
Sales and Distribution department do the work of planning supply chain structure and supply
chain activities and work-flow which will be carried throughout the organization for purchasing
materials, machineries, equipment and maintenance, repair and operating (MRO) supplies to
run the operation of manufacturing, distribution and sell of goods and services of PRAN Foods
Limited.
Planning work of supply chain of PRAN Foods Limited is usually for long term as the other
activities will recur again and again on the basis of this plan. However, review, revision,
monitoring and control of this plan is a routine activity which carried by Planning department's
employees. Sometimes planning has to be restructured, and again sometimes new plan has to
be created for new necessity and for new circumstances.
Supply chain planners decide which parties will be involved in supply chain process and what
will be their role in the process. The flow of involvement of different supply chain participants
i.e. parties are illustrated in the following figure.
Supplier
Materials Transporter
Materials Warehouse Service Provider
Manufacturer
Depot Service Provider
Distributor
Retailer
Customer
Figure 2: Structural Flow of Parties involved in the supply chain process of PRAN Foods Limited
20
The planning department plans how the materials will be procured from supplier and how the
finished product will reach the ultimate customer. In PRAN Foods Limited, supplier is selected
through some procurement process, then a materials transporter come according to contract
with the supplier. This materials transporter delivers materials to materials warehouse where
warehouse provider can be a third party or company owned. In several places, PRAN uses
company owned warehouse but in many places they also uses third party warehouses. Then
PRAN manufactures the product. After manufacturing the finished product goes to finished
product warehouses through company transportation. This finished product warehouse is also
known as depot and distribution warehouse. Then through distributor who is usually known as
agent or dealer in PRAN takes the product to his custody and according to order he delivers it
to the retailer and through retailer it reaches to the ultimate customer.
Demand Forecasting
Demand Forecasting is an essential portion of supply chain process. In PRAN Foods Limited,
the “Demand Forecasting” phase comes after “Supply Chain Planning” phase. Demand
forecasting is usually done in an organization before buying or procuring materials and
equipment for production of goods and services. Demand forecasting as a very close relation
with production of goods and services. Though it is done before procuring materials of goods
and services but other things like materials are in stock or in a planned process of procurement,
demand forecasting is done before production of goods and services. Demand forecasting is a
very crucial part in a manufacturing concern.
Being a manufacturing giant, PRAN Foods Limited has to overtake a huge demand forecasting
work. PRAN does this work with the help of their sales force. PRAN's sales force is well known
for its efficiencies and effectiveness in the country and in the industry. However, the demand
forecasting of PRAN Foods Limited is connected with Procurement department through
Operation, Sales and Marketing department. The sales force of PRAN Foods Limited usually
takes the responsibility of demand forecasting. The demand forecasting is communicated with
Operation department because this department through its production unit does the work of
production. Operation department sets its production estimate on the basis of demand
forecasting and then further communicated with “Materials Department” because on the basis
of production departments materials requirement estimation buyer releases material requisition
for material purchase.
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Procurement
Procurement refers to purchase or buying of raw materials, equipment, merchandise,
machinery, services or supplies like MRO supplies. Procurement is a very important part of
supply chain process. Without procurement of raw materials and other essential parts,
equipment or commodities no business especially manufacturing concern can run. PRAN
Foods Limited is a large food manufacturer. PRAN requires raw materials and other supplies
on a regular basis. It also requires procurement of equipment and machinery.
Procurement department of PRAN Foods Limited basically deals with purchase of raw
materials, equipment, and machinery. However, Procurement department in PRAN Company
is a very disciplined and systematic one. The Procurement department at PRAN Foods Limited
follow the procedure illustrated below –
Purchase Requisition / Material

Requistion / RFQ / RFP
Sample Testing
Contact
Purchase Order (PO)
Delivery
Payment
Warehouse
Production House
Figure 3: Procurement Flowchart of PRAN Foods Limited
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As we can visualize the procurement flowchart of PRAN Foods Limited in Figure 03, here we
can understand the flow of operations in PRAN's Procurement department. We can see that in
PRAN's Procurement department at first the purchase requisition for necessary items or
material requisition for necessary materials are issued. This requisition is issued by user of the
material or user of that designated item. Sometimes when new materials or equipment is needed
at that time Request for Proposal (RFP) or Request for Quotation (RFQ) is released. RFP is
released when the specification of the material or item needed is unknown and the item is
technically complicated one. After this item, sample from the interested potential supplier are
received and tested by the technical department related to the material.
After this the supplier whose sample has been successfully pass the sample test and whose
product meet the company's criteria is selected. After that the SCM and Procurement
department goes through every terms and condition of the supplier. Then the product with
superior quality and least price is selected for contract. PRAN Foods Limited prioritize quality
over cost. In the contract, delivery mode, payment mode, delivery terms and conditions, quality
standards, product specifications, price everything is written and meet the company's
requirement. The price is settled through bargaining.
After that a purchase order (PO) is released. It is also known as procurement order, delivery
order, demand in PRAN. Then the delivery of the purchased item is to be ensured. Sometimes
it is done PRAN itself, sometimes by the supplier and sometimes by the third party as
contracted. After this step the payment of the item takes place. During the phase of payment
the purchased item is being sent through delivery terms to the warehouse. After the item
reached the warehouse the product or item that is purchased becomes ready to go the next stage.
In this stage the item is sent to the production house to support manufacturing (if machinery,
equipment, or supplies is purchased) or for the transformation process (if the purchased item is
materials).
Logistics
In PRAN Foods Limited there two stages of logistics – one in bound logistics and other one is
out bound logistics. In bound logistics is used to transport materials and other purchased items
to manufacturer and out bound logistics is used to transport finished products for distribution.
In Bangladesh the logistics sector is not very developed. But PRAN uses one of the best
23
logistics practices in Bangladesh. They both use Third Party Logistics (3PL) providers as well
as they also use the company owned transports and carrier to transfer and transport goods and
services in one location to another. Logistics always have a very important role in a company's
operation and it is same in PRAN Foods Limited. But as Bangladesh is not a highly developed
country and so thus the country's logistics infrastructure is not, Bangladeshi companies cannot
adopt a high quality logistics system. Logistics of PRAN Foods Limited is enough for
Bangladesh but not up to the mark of the developed world.
PRAN uses air and water carriers like ships for their in-bound logistics i.e. for brining materials
and equipment into the company. However, PRAN uses motor carriers and sometimes water
carriers for distribution from depot. Often intermodal transport is used to transfer goods from
one place to another e.g. at the time of sending products to dealer by the river PRAN uses
launch and then motor carriers to the dealer’s door step.
Moreover, PRAN mainly uses motor carriers to send goods but when they need to send goods
to riverine areas they use water carriers like launch and steamers.
Manufacturing
After the Procurement phase comes Manufacturing. In this phase the materials are transformed
into finished or semi-finished products for further use. In PRAN Foods Limited, most of the
food raw materials are transformed into finished food products in a high quality transformation
process (process that transform materials into processed products). The work of manufacturing
is done under Operations department. Under department, there is a sub-department Production
which responsible for manufacturing and transformation of raw materials into finished
products. According to Operations department's schedule the production is maintained and
Operations department suggests in which ratio the raw materials should be used to process and
what process, procedures and technologies should be used to produce finished products.
Distribution
When the finished products come out of “Production House” the Distribution function of
supply chain process starts. From “Production House” through company's own transportation
or through third party transportation the finished products reaches “Finished Product
Warehouse” which is known “Depot” in PRAN Foods Limited. Dealer orders their required
24
number and types of products. Dealer has to order through Head Office. This order is known
as “Delivery Order” (DO) Head Office renders the order to Inventory Controller (IC) who is
responsible for inventory and stock management of the depot. When he verifies the stock and
give clearance of inventory, the goods are released from the depot to dealer's godown or in the
place the dealer wants. Dealers order as per their requirement (product-wise and as per their
required quantity).
From the dealer the goods are transported to retailer as per retailer's order. The retailer gets the
product in the wholesale price. There are Sales Representatives (SRs) in PRAN Foods Limited
who visits shop to shop to collect order for the dealers. The SR helps the dealer to transport the
goods to the retailer. The transporter is employed by the dealer who is a third party employee
for the company. However, the dealer can return any unsold product of the company.
Production House Finished Product

Warehouse (Depot)
Clearance of Delivery Order (DO)

Inventory Controller
Transportation of Tranprotation to
Goods to Dealer's Retailer
Go-down
Ultimate Customer
(Consumer)
Figure 4: Distribution Flowchart of PRAN Foods Limited
25
The Total Supply Chain Process of PRAN Foods Limited
Figure 5: Total Supply Chain Process of PRAN Foods Limited
26
Chapter # 3:
Recommendations
& Conclusions
27
Recommendations
Being one of the biggest giant food manufacturer in Bangladesh, PRAN Foods Limited has a
very mature supply chain process and supply chain management structure. This company is
one of the most successful in Bangladesh. As in the today's world becoming successful in
business especially in manufacturing is highly dependent on efficient and effective supply
chain, PRAN Foods Limited in Bangladesh like other successful manufacturing concern uses
an excellent supply chain policies. However, there are some sector where PRAN Foods Limited
should concentrate to improve. They are –
 PRAN Foods Limited can organize its procurement transactions somewhat to a greater
extent by regulating and by using a more systematic procurement system like the
world's leading corporations.
 At the time of negotiating, bargaining and contracting with the supplier, PRAN should
give more emphasize of quality materials and inputs to make an impact on the market
as PRAN's products is suffering from brand equity.
 PRAN should work more closely with their suppliers to reduce their number, as PRAN
is using a large number of suppliers.
 PRAN can work jointly with their key and best suppliers to develop “Supplier
Development Program” and strength their relationship by undertaking “Supplier
Relationship Management Program”.
 Being one of the most successful entrepreneur in Bangladesh, PRAN can help their
supplier grow for creative innovation in their fields and by doing so can show other
firms in the country a way to success and at the same time can reap their benefits.
 Logistics of PRAN Foods Limited is a good one but they reduce their high dependency
on third party logistics providers.
 Distribution of PRAN Foods Limited somewhere inefficient. For example, sometimes
when the goods for to be supplied to five dealers, at that time often one or two dealers
are overlooked and ignored. When time of follow up comes, they again go to the first
two or three dealers and thus wasting time. For this they used some automated efficient
software based process.
28
Conclusions
PRAN-RFL Group is a very successful group of companies in Bangladesh. PRAN Foods
Limited is one of the most successful SBU of PRAN-RFL Group. It has a large supply chain
compared to other food manufacturer in Bangladesh. This company carries a large number of
products and a good number of food brands. PRAN's management is a very active and clever
in branding their food products. However, all of their food brands are not of high brand value
and brand equity. Thus all the brands are not successful. Like all the world's big name
companies (Apple, Dell, HP) PRAN Foods Limited can have a unique place in the world of
business by employing efficient and effective supply chain strategies and techniques. A world
class supply chain can also improve brand equity and performance. Nevertheless, PRAN Foods
Limited is doing well in their supply chain operations. By successfully mitigating all supply
chain obstacles PRAN Foods Limited can become a company that every company in the
country wants to counterfeit for policy, for strategy, and to become successful.
29
Bibliography
30
Bibliography
Islam, A. (2017, March 24). Interview for Information of Supply Chain Management Process of PRAN
Foods Limited. (F. Kabir, Interviewer)
PRAN Foods Ltd. (2017, March 30). About PRAN: PRAN Foods Ltd. Retrieved from PRAN Foods Ltd. Web
site: http://www.pranfoods.net/who_we_are.php
PRAN Foods Ltd. (2017, March 30). Corporate Social Responsibility: PRAN Foods Ltd. Retrieved from PRAN
Foods Ltd. Web site: http://www.pranfoods.net/csr.php
PRAN Foods Ltd. (2017, March 30). Export: PRAN Foods Ltd. Retrieved from PRAN Foods Ltd. Web site:
http://www.pranfoods.net/export_history.php
PRAN Foods Ltd. (2017, March 30). Product: PRAN Foods Ltd. Retrieved from PRAN Foods Ltd. Web site:
http://www.pranfoods.net/product.php
Wisner, J. D., Tan, K.-C., & Leong, G. K. (2014). Supply Chain Management: A Balanced Approach. Delhi:
Cengage Learning India Private Limited.
31

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AN ANALYSIS OF SUPPLY CHAIN

Dr. Mahbub Alam

Course Instructor: Principles of Supply Chain Management (SCM 501)

 Kazi Anamul Hasan

Subject: Submission of term paper on “An Analysis of Supply Chain Management

Chapter # 2: Supply Process of PRAN Foods Limited

First, we will talk about the company.

PRAN's Mission & Vision

PRAN's Corporate Values

 Complaint for our products

Objectives that we seek through our consumer care are:

 To create a culture of customer focus

 Cell Phone: +88-01973-737777 (During 8 A.M. to 8 P.M.)

 By providing them good seeds, fertilizers, insecticides etc.

We care about their needs in the following ways:

 By listening to product complaints.

11. Basic Spice

Export Profile of PRAN

In recognition of contribution towards earning foreign currency, PRAN achieved “Best

Corporate Social Responsibility

Bangladesh’s comparative advantage lies in creating a competitive edge in value added

Promises to the Environment

Effluent Treatment Plant (ETP)

Heat Recovery Boiler

Promises to the Energy Preservation

Promises to the People

1. We aim at building trust through clear communication.

Promises to the Community

Other Social Support

We are a business entity. We care for the Environment, Natural resources,

PRAN Foods Limited is a renowned company in Bangladesh. Supply Chain Management

Supply Chain Steps of PRAN Foods Limited

Figure 1: Supply Chain Phases of PRAN Food Limited

Supply Chain Planning

Materials Warehouse Service Provider

Depot Service Provider

Purchase Requisition / Material

Purchase Order (PO)

Figure 3: Procurement Flowchart of PRAN Foods Limited

Production House Finished Product

Clearance of Delivery Order (DO)

Figure 4: Distribution Flowchart of PRAN Foods Limited

The Total Supply Chain Process of PRAN Foods Limited

Figure 5: Total Supply Chain Process of PRAN Foods Limited

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