SUMMER TRAINING PROJECT

ON

INVENTORY MANAGEMENT OF VERKA MILK PLANT LUDHIANA

Submitted To

I.K. GUJRAL PUNJAB TECHNICAL UNIVERSITY KAPURTHALA

In partial fulfillment of the requirement for the award of

Degree of

Master of Business Administration (MBA)

Submitted By Supervisor

Tapjeet singh Palak Sachdeva

2232272 Charted Accountant (CA)

DEPARTMENT OF MANAGEMENT

GULZAR GROUP OF INSTITUTES

KHANNA

(2022-2024)
CERTIFICATE
 STUDENT DECLARATION

I, “Tapjeet Singh”, hereby declare that I have undergone my summer training at “Verka Milk
Plant Ludhiana” from 11/06/2023 to 23/07/2023. I have completed a research project tilted
“INVENTORY MANAGEMENT OF VERKA MILK PLANT” under the guidance of .Ms’ Palak
Sachdeva.

Further I hereby confirm that the work presented herein is genuine and original and has not been
published elsewhere.

Tapjeet Singh
 FACULITY DECLARATION

I hereby declare that the student Mr. / Ms. Tapjeet Singh of MBA (II) has undergone his/her
summer training under my periodic guidance on the Project titled

“INVENTORY MANAGEMENT OF VERKA MILK PLANT”.

Further I hereby declare that the student was periodically in touch with me during his/her training
period and the work done by student is genuine & original.

-------------------

(Signature of Supervisor)
ACKNOWLEDGEMENT
TABLE OF CONTENTS

Certificate by Guide ii
Student Declaration iii
Faculty Declaration iv
Acknowledgment v
CHAPTER NO. CHAPTER TITLE PAGE NO.
1 Introduction to the Company
2 Introduction to the Research Problem
3 Need, Scope and Objectives of the Study
4 Research Methodology
5 Data Analysis and Interpretation
6 Findings of the Study
7 Conclusion, Suggestions & Recommendations of
the Study
References and Bibliography
Appendix
(Questionnaire, Glossary of Terms, Abbreviations, Documents, Performa,
Financial statements, etc.)

LIST OF TABLES

TABLE NO. TABLE TITLE PAGE NO.

LIST OF FIGURES

FIGURE NO. FIGURE TITLE PAGE NO.

 Chapter – 1

INTRODUCTION
1.1 AN OVERVIEW OF TO CO-OPERARIVE MILK UNION

Concept of milk

Mostly our daily routine starts with the consumption of Tea, bette or coffee that
requires milk along with other ingredients. We consume milk and various other milk products
daily

Earlier people were able to satisfy their needs for milk by their own cattle’s or by
purchasing from nearby sources. They used to prepare various milk products individually but
milk provided by these resources was not of good quality and was full of fat etc. so, people
were in search of products it gave birth to collection of milk at a single source and suppliers it
to required ones.

Present concept of milk

With advancement of new methods and techniques used, to improve the quality of
milk, good quality of milk and milk products are prepared with diversity. Use of these
techniques results in low cost, better quality, and variety of products and offerings to
consumers. As consumer is a “KING” today.

Co-operative milk union in India

“MILK UNION” Means union of milk producers, a union established when few people
join hands for some common purpose.

First cooperative milk union was established in 1965 at Kheda (Anand distt. In Gujarat
State) by a Jat famous as “Dairy King” and named AMUL (Anand MILK Union Ltd.) the
dairy follows Anand pattern a step to develop dairy as industry allied to agriculture and to
prevent harassment farmers and consumers. Before independence, there were dairy cards
called “Poison Dairy” by English people. They were procuring milk from the milk producers
by force and without any payments. Exploited farmers gave birth to revolution in the dairy
business.

They join hands to prevent themselves from the harassment of English people, for their
own betterment and to provide good policy and right prices of milk products to consumers.
 Here they started their own dairy at kheda. After independence NDDB (National Dairy
development board ) was established in Gujarat State and inaugurated by former P.M of india
“Shri Lal Bahadur Shastri in 1965 .

Co-operative milk union in Punjab

Doing 1970-71 “operation flood 1” (a dairy program ) took place , where cover 18 district all
over the country to establish milk union as per recommendations of Shri Lal Bahudar Shastri.
Under operation Flood 1 PDDC (Punjab Dairy Development Co- operation) selected
Ludhiana District of Punjab as one of the milk shed to develop (Anand pattern).It is first
place in Punjab to establish milk unions.

Later on operation Flood 2 took place in 1980-81 which covers almost all districts in
Punjab. At present these Milk Unions are running successfully and achieving their goals in
theS entire country . Government is also providing time –to-time facilities to these Milk
Unions.
1.2 INTRODUCTION TO VERKA MILK PLANT

Verka is a flagship brand of MILKFED and came into being in 1973 when MILKFED was
mandated for milk procurement, quality processing of milk & its products and marketing of
these products. “Verka” was christened after the name of the place where the first plant was
setup in Amritsar.

A trusted brand, Verka has become a household name and is loved by its customers for
nutrition, quality and sheer indulgence. It has consolidated its brand strength by not only
retaining the high quality of existing products but also by innovating and bringing new
products to the tables of its diverse customers.

Verka has a wide range of products including different variants of Pasteurized pouch Milk,
Ghee, Table Butter, Skimmed Milk Powder, Whole Milk Powder, Dairy Whitener, Cheese,
Sweetened Flavoured Milk, Ice Cream, Indigenous sweets, along with Fresh Products like
Lassi, Paneer, Dahi, Kheer and Tetra Pack Products such as fruit beverages & Milk. The
products are available in Punjab, Haryana, Himachal Pradesh, Jammu & Kashmir and
Northeast India. Verka also exports ghee to countries like the Middle East, Australia, Japan,
New Zealand and Malaysia.
Verka stands apart, with its promise of purity! In the milk testing done by NABL (National
Accreditation Board for Testing and Calibration Laboratories) accredited laboratory, Verka
Gold has topped the full cream milk category with a score of 88 out of 100. The brand
registered the highest milk fat at 6.69%, a lower saturated fat of 3.52%, and lower cholesterol
content of 8.67mg/100g. Verka milk is also loaded with Calcium and Vitamin A.

The Start of our Story

The Punjab State Cooperative Milk Producers’ Federation Limited, popularly known as
MILKFED, came into existence in 1973 to boost the dairy farming in the state. The primary
objective of the Federation was to provide a remunerative market to the milk producers in the
state through value addition and effective marketing of the produce. The other objective was
to provide technical inputs to the milk producers for enhancement of milk production.

Although the federation was registered much earlier, it took its current bigger role, in the year
1983 when all the milk plants of the erstwhile Punjab Dairy Development Corporation
Limited were handed over to Cooperative sector under Operation Flood. This move was
directed at the giving the farmers a better deal and the customers better products. The
organization setup follows a three tier system: Milk Producers Cooperative Societies at the
village level, Milk Unions at District level and Federation as an Apex Body at State level.
MILKFED Punjab has continuously advanced towards its coveted objectives well defined in
its bylaws.

Collecting the Drops of Goodness

Currently, Verka sources milk from over 3,50,000 members of around 6300 village milk
producers’ cooperative societies. These village level cooperatives work under 11 district milk
producers’ unions with 9 milk plants having a consolidated milk handling capacity of around
30,00,000 litres per day. Each Verka product is the manifestation of natural goodness
unlocked by adopting state of the art technology.

Verka has paid remunerative price of up to Rs 710/- per kg fat to the milk producers in FY
2021-22. Apart from an attractive price, transparency in payments, better testing and effective
quality assurance systems makes Verka the perfect choice for the milk producers. This
culminates into high milk procurement by the brand. It procured an average 19.16 lac litres of
milk per day during FY 2021-22 as against 18.49 lac litres of milk per day during the FY
2020-21.

VERKA NETWORKS

With an aim to maximum reach out to its consumers, Verka has developed a widespread
network of milk unions in different towns of Punjab. The primary aim was to provide a
lucrative milk market to the state milk producers by value addition and marketing of produce.
Another of its objective was to provide technical inputs for the enhancement of milk
production.

Milkfed has strong base with 11 District Cooperative milk unions having 9 milk plants of the
unions (except Ferozpur& Faridkot). Additionally, Milkfed has 2 Cattle Feed Plants at
Khanna & Ghania Ke Banger, 1 Fodder Seed Processing Unit at Bassi Pathana, 1 Frozen
Semen Station at Khanna, 2 ice cream manufacturing plants at Chandigarh & Bathinda, and
state of the art UHT plants at Chandigarh & Bassi Pathana. The total handling capacity of
milk plants is 30.00 lac litres per day.

With advanced technology and customer satisfaction in mind, Verka strives to provide best
quality products to its esteemed customers in almost all of Punjab.

SANGRUR FEROZPUR

CHANDIGARH FARIDKOT

MOHALI BATHINDA
VERKA NETWORKS

PATIALA AMRITSAR

LUDHIANA GURDASPUR

JALANDHAR HOSHIARPUR
1.3 Mission Vision and Objectives of Verka Milk Plant

Mission vision and objectives of verka milk plant are written as follows:

Vision

To become most admired brand in the dairy section and vibrant cooperative institutions in the
country, facilitating inclusive growth.

Mission

Ensuring prosperity to the milk producers’ by ensuring milk procurement at remunerative

prices around the year coupled with providing quality extension services for enhancing milk
production as well as reducing costs. Ensuring quality presence of milk and production of
milk in a clean, hygienic manner and making them available to the consumers at a reasonable
prices through excellence in market.

Objective

1. To ensure quality milk procurement at remunerative price coupled with improved

animal productivity for reducing cost of milk production for sustainable growth of the
milk producers.
 2. To provide quality extension services at the door steps of milk producers.
3. To ensure Quality Assurance in procurement, processing & marketing and enhancing
efficiency in the entire value chain.
4. To ensure acquisition, development and retention of competent manpower.
5. To improve fiscal management by optimizing the returns on capital.
6. To ensure continual modernization in the entire value chain through effective
leveraging of technology.
7. To embrace innovation in the entire value chain for consumer delight.
8. To ensure continual expansion of distribution.
9. To enhance brand equity.

1.4 SWOT Analysis of verka milk plant

SWOT Analysis is a framework for identifying and analysing the organization’s Strength,
Weakness, Opportunity and Threats. These words make up the SWOT acronym. The primary
goal of SWOT analysis is to increase awareness of the factors that go into making a business
decision or establishing a business strategy.

STRENGTH

 Brand loyalty among the customer for verka products.

 Good brand image of verka products in the mind of customers.
 Faith on verka products by the customers.
WEAKNESS

 Lack of proper advertisement by the plant such as posters, glow signs.

 Lack of proper agencies system in covering the rural areas.
 Lack of proper marketing networks in rural areas as like in urban areas.

OPPORTUNITY

 Greatly improved expert potential for milk products of western as well as traditional
types.
 Proper utilization of available resources to decrease per unit cost.
 By product utilization for import substitute.

THREATS

 Introduction of foreign products in Indian market

 Poor quality of milk.
 The liberalization of dairy industry is likely to exploit by multinationals. They will be
interested in manufacturing milk products in yield high profits.

1.5 BOARD OF DIRECTORS OF VERKA MILK PLANT

MEMBERS OF BOARD OF DIRECTORS

Sr.
Member Designation
No.
1. Narinder Singh Shergill Chairman
2. Sh.Bhupinder Singh Randhawa Director
3. Sh.Baljeet Singh Director
4. Sh.Rameshwar Singh Director
5. Sh.Ranjit Singh Director
6. Sh.Amandeep Singh Director
7. Sh.Harminder Singh Director
8 Sh.Gurbhej Singh Tibbi Director
9 Sh.Tejinder Singh Director
10 Finance Commissioner & Secretary, Department of Animal
 Husbandry, Punjab Govt., Chandigarh or his representative
Registrar, Cooperative Societies, Punjab, Chandigarh or his
11
representative
12 Managing Director, Milkfed Punjab
Nominee
13 Sh.Rajesh Gupta
N.D.D.B.
Nominee
14 Dr. Kaushik Khamrui
N.D.R.I.
Nominee
15 Dr. Ravinder Singh Grewal
GADVASU

1.6 Organizational structure

Chairman Sh. Narinder Singh Shergill

Sh.Amit Dhaka (IAS)
Managing Director
Email ID: md@verka.coop
Departments:
CIVIL
Harjinder Singh
Manager
Email ID: civil.milkfed@verka.coop
Procurement & Live Stock Management
Rainoo Dhar Dr. Amritpal Singh
General Manager Dy. Manager

Email ID: gmplm.milkfed@verka.coop Email ID: amritpal.johar@verka.coop

Quality Assurance & Engineering

Sanjeev Sharma Sameer Kohli
General Manager Dy. Manager

Email ID: gmqa.milkfed@verka.coop Email ID: sameerkohli@verka.coop

Marketing
Harminder Singh Sandhu Parminder Kumar

General Manager, Marketing Dy. General Manager, Marketing

Email ID: gmmktg.milkfed@verka.coop Email ID: parminderkumar@verka.coop

Rajiv Bajaj Vikram Katyal

Manager Manager

Email ID: rajivbajaj@verka.coop Email ID: vikramkatyal@verka.coop

Bonny Vatwani Nitesh Sangwan

Deputy Manager Deputy Manager

Email ID: bonny.vatwani@verka.coop Email ID: niteshsangwan@verka.coop

Karan Sharma Alok Bhatia

Asst. Manager Asst. Manager

Email ID: karansharma@verka.coop Email ID: alokbhatia@verka.coop

M.I.S, Systems & IT

Sanjeev Sharma Sandeep Jain

General Manager (Systems & MIS) Deputy Manager

Email ID: mis.milkfed@verka.coop Email ID: mis.milkfed@verka.coop

Purchase
Rainoo Dhar Manika Agarwal
General Manager Deputy Manager

Email ID: pur.milkfed@verka.coop Email ID: manika@verka.coop

Finance & Accounts

Rajiv Goyal Shivali Gupta
Deputy Manager Deputy Manager

Email ID: acc.milkfed@verka.coop Email ID: shivaligupta@verka.coop

Administration/HR
 Jasbir Singh Riar Sumansh Vashisth
Dy. General Manager Manager

Email ID: admn.milkfed@verka.coop Email ID: sumanshvashisth@verka.coop

1.7 TURNOVER

The annual turnover of verka milk plant Ludhiana with profit from FY 2016 to FY 2022 is as
written as follows:

YEAR TURNOVER IN CR. PROFIT IN LAC.

2016-17 664.05 678.42
2017-18 649.94 435.66
2018-19 715.67 535.61
2019-20 732.12 549.13
2020-21 794.48 579.62
2021-22 806.89 598.98

1.8 Products of Verka Milk Plant

 MILK PACKS

 Verka gold
 Verka shakti  Verka taaza

 Cow milk  Verka slimmer’s

 Verka lite

 FRESH PRODUCTS

 Dahi  Jeera raita

 Low fat dahi  Plain dahi
 Matka bulk pack
 Lassi
  Sweet lassi  Low fat lassi
 Spiced lassi  Plain lassi

 Paneer  Kheer
 Paneer  Traditional kheer

 GHEE & BUTTER

 Butter  Ghee
 Table butter  Ghee
 Cow ghee

 BEVERAGES

 Sweetened flavoured milk

 Haldi dudh  Badam

 Honey ginger  Pista
 Cold coffee  Strawberry
 Thandai  Elaiche
 Chocolate  Butterscotch

 Verka lassi

 Namkeen lassi  Rose lassi

 Strawberry lassi  Sweet lassi
 Mango lassi

 Refreshments

 Vanilla milk  Mango shake

 Sugar free banana  Nimbupani
 Choco milk  Mango raseela
 Aam panna

 ICE CREAM
 Real fruit ice cream
  Strawberry  Pink Guava
 Mango  Litchi

 Cassata and sundaes

 Sundae strawberry ripple  Cassata

 Sundae chocolate ripple

 Bricks

 Pineapple  Black current

 Kaju kishmish  Mango
 Vanilla  Chocolate
 Choco chip  Tutti fruity
 Kesar nut  Strawberry
 Butterscotch  Malai kulfi

 Candies and sticks

 Choco delight  Lemon

 Choco choco bar  Raspberry
 Mango bar  Water melon
 Pineapple  Blsck berry
 Black current  Orange bar
 Milk treat  Choco bar
 Cola bar  Mango duet

 Amour

 Kaju anjir  Muddy chocolate

 Afghan dry nut  Cookiee and crumb
 American nut  Almond carnival

 UHT MILK

 Fresh +  Toned UHT milk (army)

  Standard UHT milk  Double toned UHT milk
 Toned UHT milk

 CHEESE & SPREADS

 Processed cheese  Cheese spread

 Cheese singles

 SWEETS
 Verka sweets

 Sugar free milk cake  Panjiri

 Gulan jamun  Peda
 Chana burfi  Soan papdi
 Roasted burfi  Milk cake
 Til bhuga  Mah daalpini
 Corporate mix  Gur rewdi
 Kaju pinni  Ground nut gachak
 Til milk cake  Til pattigachak
 Dhoda  Boondi laddu
 Kaju burfi

 MILK POWDER
 Verka milk powder

 Dairt whitener  Skimmed milk powder

 Whole milk powder
 Chapter – 2

INVENTORY MANAGEMENT
INVENTORY MANAGEMENT

Inventory management is the supervision of noncapitalized assets -- or inventory -- and

stock items. As a component of supply chain management, inventory management supervises
the flow of goods from manufacturers to warehouses and from these facilities to point of
sale.A key function of inventory management is to keep a detailed record of each new or
returned product as it enters or leaves a warehouse or point of sale.

Organizations from small to large businesses can make use of inventory management to track
their flow of goods. There are numerous inventory management techniques, and using the
right one can lead to providing the correct goods at the correct amount, place and time.

Inventory control is a separate area of inventory management that is concerned with

minimizing the total cost of inventory, while maximizing the ability to provide customers
with products in a timely manner. In some countries, the two terms are used synonymously.

Definition:

“Inventory management is a science primarily about specifying the shape and percentage of
stocked goods. It is a required at different locations of within a facility or within many
locations of a supply network to precede the regular and planned course of production and
stock of materials”

Why is inventory management important?

Inventory management is vital to a company’s health because it helps make sure there is
rarely too much or too little stock on hand, limiting the risk of stockouts and inaccurate
records.

Public companies must track inventory as a requirement for compliance with Securities and
Exchange Commission (SEC) rules and the Sarbanes-Oxley (SOX) Act. Companies must
document their management processes to prove compliance.

Benefits of inventory management

The two main benefits of inventory management are that it ensures you’re able to fulfil
incoming or open orders and raises profits. Inventory management also:

 Saves money: Understanding stock trends means you see how much of and where
you have something in stock so you’re better able to use the stock you have. This
also allows you to keep less stock at each location (store, warehouse), as you’re able
to pull from anywhere to fulfil orders — all of this decreases costs tied up in
inventory and decreases the amount of stock that goes unsold before it’s obsolete.
 Improves cash flow: With proper inventory management, you spend money on
inventory that sells, so cash is always moving through the business.
 Satisfies customers: One element of developing loyal customers is ensuring they
receive the items they want without waiting.

Inventory management challenges

The primary challenges of inventory management are having too much inventory and not
being able to sell it, not having enough inventory to fulfil orders, and not understanding what
items you have in inventory and where they’re located. Other obstacles include:

 Getting accurate stock details: If you don’t have accurate stock details, there’s no
way to know when to refill stock or which stock moves well.
 Poor processes: Outdated or manual processes can make work error-prone and slow
down operations.
  Chaning customer demand: Customer tastes and needs change constantly. If your
system can’t track trends, how will you know when their preferences change and
why?
 Using warehouse space well: Staff wastes time if like products are hard to locate.
Mastering inventory management can help eliminate this challenge.

Types of Inventories

 Transit inventories: - Inventories many times have to be transported from one

location to the other as they pass through the levels of manufacturing. These
inventories are called transit of pipeline inventories as they are in transit from a
location to another. Automobile manufactures make use if freight consolidations to
pool in their investors.
Case: - HPCL handles the transportation from refineries to customers through various
modes like roadways, shipping, pipeline.
 Buffer Inventories: - Inventories are sometimes used ton count attract the
uncertainness of demand and supply. They could also be used to take care of
unforeseen situation like poor transportation, poor quality etc. the more safety stock of
a firm has very small is its probability of running in to stock out situation.
 Application Inventories: - Firm often purchase and hold stock which is much higher
than their present requirements in application of a future event. These events can
include:
 Seasonal variation in demand
 Price variation
 Labour strike
 Chapter – 3

NEED, SCOPE AND OBJECTIVE OF

STUDY
NEED OF STUDY

Inventory management helps companies identify which and how much stock to order at what
time. It tracks inventory from purchase to the sale of goods. The practice identifies and
responds to trends to ensure there's always enough stock to fulfill customer orders and proper
warning of a shortage.

SCOPE OF STUDY

OBJECTIVE OF STUDY

 To analyse the inventory expenses of the plant and providing solutions to reduce
inventory expense.
 Chapter – 4

RESEARCH METHODLOGY
RESEARCH METHODOLOGY

Research design is the arrangement of conditions for collections ands analysis data in manner
to combine relevance to the researcher purpose with economy in procedure. Research
methodology is a way to systematically solve the research problems. It deals with the
objective of a research study, the method of defining the research problem the type of
hypothesis formulated, the type of data collected, method used for data collecting and
analysing the data etc. the methodology includes the collection of primary and secondary
data.

RESEARCH

Any efforts which are directed to study of strategy needs to identify the problems and
selection of best solution for better results are know as research.Research is an activity that
leads us to finding new facts, information, assisting us in verifying the available knowledge
and in making us question things that are difficult to understand as per existing data.

RESEARCH DESIGN

In view of the objects of the study listed above an exploratory research design has been
adopted. Exploratory research is one which is largely interprets and already available
information and it lays particular emphasis on analysing and interpretation of the existing and
available information.

 To know the financial status of company.

 To know the credit worthiness of the company.
 To offer suggestions based on research finding.

TYPES OF RESEARCH

There are different types of research, some of these types are written as follows:

 Descriptive research:
The study follows descriptive research method. Descriptive study aims at portraying
accurately the characteristics of a particular group of situations. Descriptive research
 is concerned with describing characteristics of a particular or individual group. Here
the researcher attempts to presents the facts by collecting data.
 Research design:
A research design is a basic of framework, which provides guidelines for the rest if
research process. It is the map of a blueprint according to which the research is to be
conducted.
 Sources of data:
The task of data collection begins after research problem has been identified and
research design chalked out. Data collected are classified into primary and secondaru
data.

PRIMARY DATA

Primary data is a type of data that is collected by researchers directly from main sources
through interviews, surveys, experiments, etc. Primary data are usually collected from the
source—where the data originally originates from and are regarded as the best kind of data in
research.

The sources of primary data are usually chosen and tailored specifically to meet the demands
or requirements of particular research. Also, before choosing a data collection source, things
like the aim of the research and target population need to be identified.

For example, when doing a market survey, the goal of the survey and the sample population
need to be identified first. This is what will determine what data collection source will be
most suitable—an offline survey will be more suitable for a population living in remote areas
without an internet connection compared to online surveys.

SECONDARY DATA

Secondary data (also known as second-party data) refers to any dataset collected by any
person other than the one using it.

Secondary data sources are extremely useful. They allow researchers and data analysts to
build large, high-quality databases that help solve business problems. By expanding their
datasets with secondary data, analysts can enhance the quality and accuracy of their insights.
Most secondary data comes from external organizations. However, secondary data also refers
to that collected within an organization and then repurposed.

It also includes the annual reports, website of the company are which contains details, which
is helpful for making my project report.

In this project report I have used the secondary data as provided by the company.
 Chapter – 5
DATA ANALYSIS

TYPES OF INVENTORY IN VERKA MILK PLANT

TRANSIT INVENTORIES
Inventory many times has to be transported from one location to the other as they pass
through the level of manufacturing. These inventories are called transit or pipeline
inventories as they are in transit from location to another. Automobile manufacturers make
use of freight consolidation to pool in their investors.

Case: HPCL handles the transportation from refineries to customers through various modes
like roadways, shipping, pipelining etc.

BUFFER INVENTORIES: -

Inventories are sometime used to count attack the uncertainties of demand and supply. They
could also be used to take care of unforeseen situations like poor transportation, poor quality
etc. The more safety stock of a firm has very small its probability of running into stock out
situation.

APPLICATION INVENTORIES: -

Firm often purchase and hold stock which is much higher than their present requirements in
anticipation of a future events. These events can include:

 Seasonal variation in demand

 Price variation
 Labour strike

This method firms to build up their inventory reserves when the demand is declining as the
demand shoots up they can utilize the inventory. The firm need not to increase thoer
inventory.

DECOUPLING INVENTOEY: -

The production time of each machine in a manufacturing plant varies. Some system produce
more products in the same time duration the fatering of machine must not affect the entire
production process.

Case: consider a book manufacturing firm. If it is known that paper manufacturing machine is
not working for few days then the manager forecasts the requirement and carries out another
activity like binding so that entire process still intact.

The Most Common Used Inventories:

  Raw material
 Work in progress
 Finished goods
 Maintainance, repair and overhaul

PACKING MATERIAL:

Any material used easily to protect something. Packaging wadding material stuff. The
tangible substance that goes into makeup of physical object, wheat is a stuff to make bread.

Packaging is a technology of enclosing or protecting products for distribution, storage, sale

and use. Packaging also refers to the process of designing, evaluating and production
packages. Packaging can be described as a coordinated system of preparing goods for
transport, warehousing, logistic.

Previous year amount Current year amount

19156049.75 18269283.70

Interpretation: -expenses of packing material has been reduced for Rs/- 886766.05 in
comparatively of last year.

Printing and Stationary

Printing is a process for reproducing text and images using a master from or template. The
earliest examples include cylinder seals and other objects such as the cyrus cylinder and the
cylinders of Nabonidus. The earliest from the woodblackprinting came from china dating
from dating to before 220 AD. Later developments in printing include moveable type, first
developed by Bi Sheng in China. Johanns Gutenberg introduced mechanical moveable type
printing to Europe in the 15th century his printing played a key rolein the development of a
Renaissance, Reformation, the age of enlightment and the specific resolution and laid the
material basic for the modern knowledge-based economy and the spread of learning of the
masses.

Stationary is amass noun referring to commercially.

Manufactured writing materials including cutpapers, envelops, writing implements, continues
stationary and other office supplies. Stationary included materials to be written on by hand or
by equipment such as computer printers.

General: office supplies used for writing, typing or printing. Not to be confused with
stationary which means not moving or having a fixed position.

Computing: several kind of papers in printers such as single sheet stationary, Paper cut into
standard size sold usually inreams of sheets and used mainly with friction feed printer such as
inkjet or laser printers. Continuous stationary fan folded paper with sprocket holes on side
and transverse perforations for easy separations into individual sheets used mainly with
impact printers. It is of two types, single part or multipart any have two three or more plies of
carbonless copying paper.

Previous year amount Current year amount

533134.10 508873.00

Interpretation: - The expenses of printing and stationery are reduced for Rs/- 242610.10than
the last year.

Chemicals and detergents

Chemistry is the study ofmatter and interactions with other matter. Anything made is
therefore a chemical. Any liquid, solid, gas. Anty pure substance: any mixture water a
chemical. Technically speaking, so is a chunk of your computer. A chemical can often be
broken down into components, as is true with your computer. However, people generally use
the term chemical to refer to a substances that appears homogeneous or same throughout its
structure.

Cleaning agents that helps to remove dirt and grease from poros surface (such as fabrics,
clothes, non treated wood). All detergents are made when cleaning out area of your factories
so you know the job is done right.

Previous year amount Current year amount

491389.25 758088.15
Interpretation: - the expenses on chemical and detergents are increased by Rs/- 266698.9 than
the last year.

Labour welfare fund

Labour welfare is an important relation, labour welfare includes overall welfare facilities
designed to take care of well being of employees an in order to increase their living
standards. It can also be provided by government, non government agencies and trade unions.

Previous year amount Current year amount

201429.15 413681.60

Interpretation: - labour welfare fund has increased by Rs/- 212252.45 than the last yea.

Hardware and building material

Household hardware or simply hardware, is a general term for equipment that can be
touched/held by hand such as screw, nuts, washers, keys, locks, hangers, latches, handles,
wire chains, belts, plumbing supplies etc. household hardware is typically sold in hardware
store.

Building material is any material which is used for construction purpose. Many naturally
occurring substances such as clay, rocks, sand and wood even twings and leaves have been
used to construct buildings.

Previous year amount Current year amount

469890 279073

Interpretation: - the expenses on hardware and building material are reduced by RS/- 190817
as compared to last year.

Ingredients for milk products

An ingredient is a substance that forms part of a mixture. For example in cooking, recipes
specify which ingredients are used to prepare a specific dish. Many commercial products
contain a secret ingredients that is purposed to make them better than competing products. In
the pharmaceutical industry, an active ingredient is that part of a formulation that yields the
effects expected by the customer.

Previous year amount Current year amount

93326.90 20493.30

Interpretation: - the expanse of ingredients for milk products are reduced by Rs/- 72833.6 as
compared to last year.

Vehicle spares

Previous year amount Current year amount

131905.15 203903.30

Interpretation: - the expanse of spare parts of machinery is increased by Rs/-71998.15 as

compared to the last year.

Machinery spares

Previous year amount Current year amount

7683936.90 8354041.25

Interpretation: - the expanse of spare parts of machinery is increased by Rs/-670104.55 as

compared to the last year.

Other consumables stores

They would soon consumable in the market and that made me a bit unhappy because I really
valued their originality.

Previous year amount Current year amount

9722301.10 51393039.95
Interpretation: - the expanses of other consumable store are increased by Rs/-42170738.85 as
compared to the last year.
 Chapter – 6
Limitations of study

Limitations of inventory management practices

Inventory management is affected by variations at any stage of production transportation or

even warehousing. Proper inventory management will increase the company’s flexibility with
the right product available at the right time at the right place.

Deficient decisions
An y channel strategy has to revolve around the ultimate objective a satisfied customer. The
issue that arises here is inadequancy in defining the customer services. Since it is highly
individual concept and cannot really be measured evaluation of performance is concern.

Unreliable delivery schedules

Inventory-in-transit can lead to confusion n the ranks of both manufactures and the
distributors. While the stock has already left the manufacturers warehouse any distributor in-
transit can throw the distributor completely off-schedule.

Information system

Most of the manufacturers and channel partners use information system to streamline their
operations. However, these information system operate in isolation without any integration
between themselves. This led to duplications and redundancy in work.

Simplistic policies

Most inventory policies are cantered on the quality of usage of goods stocked. However, they
do not always consider the unpredictability surrounding the usage. Once they are considered
the stocking policies will be more flexible resulting in minimal stock outs and inventory pile-
ups.

Impact of uncertainties

Most policies are formulated under a set of assumptions about the future ideally the potential
variations from the projections should be predicted and accommodated in the planning. When
they are not the impact of these uncertainties will bear heavy n the inventory management.

Organizational bottlenecks

In case of business units and other profit canters the internal suppliers have their own goals to
achieve, which derails he pursuit of synergy. Interdepartmental and other bureaucratic issues
have often been the cause of many pitfalls.

The metrics
Supply chains today have morphed into complex and confusing structures. Measuring
performance of even internal partners can at times be difficult therefore evaluating the supply
chain can be cumbersome task.
 Chapter – 7

Suggestions

Suggestions

Lets keep it simple: inventory is the lifeblood of the supply chain. It is what flows from node
to node and it each node it is critical to figure out that perfect balance of supply and demand
or else suffer dire consequences. If you have too little inventory you risk lost sales and
customers from “out of stocks”. If you have too much inventory you will need more of
everything more space more transportation more handling more labour and more money.

Considering inventory optimization tools

inventory optimizations tools have been gaining a ground as companies seek to evaluate their
gaining ground as companies seek to evaluate their entire network and determined the best
inventory policies for each product at each node in their supply chain. These are typically
stand-alone software tools that use data from WMS and ERP system.

Employee business solution that use real-time analytics under one platform

According to mechal wohlwend, vice president of SAP Americans and this year’s vice
president of the warehousing education and research council “the days of managing inventory
using excel spreadsheets are passe”.

Don’t treat all SKUs the same

There is no such thing as a one size fits all solutions. “each and every product does not have
the same supply and demand variability pattern” says Sapra. “focus on these 20% that
statically make up 80% of the volume and manage that inventory really well so you
maximize sales and profits”.

Keep an eye on your supplier

There are suppliers that don’t necessarily sticks to their schedule or deliver on their
commitments. “it is not only interms if timing but also fill rate,” says wheeler. “if you
ordered 1000 cases of pencils and the order shows up at the door with only 900 then that’s a
problem”

BIBLIOGRAPHY

https://verka.coop/about-us/

https://verka.coop/network/

https://verka.coop/product/

What is Inventory Management? Definition & Overview (techtarget.com)

What is Inventory Management? Benefits, Types, & Techniques | NetSuite