FMCGandECommerce

Assignment3submittedby RaghavMishra CS06B018

INTRODUCTION
Over the past 150 years, there has been a shift in the manufacturing system from Centralized (IndustrialEra)toDistributed(Mid20thCentury)tothepresentdayoutsourcingframework.Itisin theDistributedFrameworkofFMCGManufacturersthatwehavethefollowing5stepsinthegoods' lifecycle: Design Manufacturing Marketing Accounting Maintenance In this report, all the above 5 steps have been explained using the very popular FMCG good, Cigarettes'productioncycle. Acigaretteisaproductconsumedthroughsmokingandmanufactured out of cured and finely cut tobacco leaves and reconstituted tobacco, often combined with other additives,thenrolledorstuffedintoapaperwrappedcylinder. IntheproductionlifecycleofaCigarette,thestagesfollowedareveryanalogoustothosefollowedin principleforanyecommerceproduct,rightthroughtheprocurementofrawmaterialstothesaleof thefinalproducttotheconsumer. Approximately 5.5 trillion cigarettes are produced globally each year and are smoked by over 1.1 billionpeopleorgreaterthanonesixthoftheworldpopulation.Anycigarettemanufacturingattempt madetomeetsuchdemandsofpeopleneedstohaveitsprocesswellnetworked;noteverythingcanbe madeunderoneroof.SupplyChainManagementisanexampleofsuchaprocesswhichisusedinthe manufacturingofCigarettes.Itisthemanagementofanetworkofinterconnectedbusinessesinvolved intheultimateprovisionoftheproductandservicepackagesrequiredbytheendconsumers. Raw Materials used in the commercially manufactured cigarettes are seemingly simple objects consistingmainlyofatobaccoblend,paper,PVAgluetobondtheouterlayerofpapertogether,and oftenalsoabasedfilter.

DESIGN
InagenericECommercedesigningapplication,designisgivenasaninputtogettheproductasan output,postmanufacturing.EnsuringthatcorrectdesignisgiventotheImplementationstageisvery crucial,whichiswhatitislikeintheCigarettedesignandsubsequentmanufacturingprocess. ThemajordecidingfactorintheDesignabstractionofacigaretteisessentiallytheamountoftobacco thatshouldbeburntwitheasewitheverypuffoftheconsumer.Alsotobedeterminedmechanicallyis theamountofnicotinethatisinhaledwitheverypuff.Althoughavarietyofdesignsofcigarettesare availableinmarkettoday,averytraditionalandapopulardesignofcigaretteshasitslengthasabout 120mmandthewidthas10mm. Design stage has its stages as the product specifications, Computer Aided Design (CAD) and the ComputerAidedManufacturing(CAM)asitsstages.

THEMANUFACTURINGPROCESS
Whiletheassemblyofcigarettesisstraightforward,muchfocusisgiventothecreationofeachofthe components,inparticularthetobaccoblend,whichmaycontainover600ingredients,[11]manyof them just flavors for the tobacco. A key ingredient that makes cigarettes more addictive is the

inclusionofreconstitutedtobacco,whichhasadditivestomakenicotinemorevolatileasthecigarette burns. Acigaretteessentiallyhastwopartstoitpaperandthetobaccoblend.Theprocessusedisdescribed below. Paper: Thepaperforholdingthetobaccoblendmayvaryinporositytoallowventilationoftheburning ember or contain materials that control the burning rate of the cigarette and stability of the producedash.Thepapersusedintippingthecigarette(formingthemouthpiece)andsurrounding thefilterstabilizethemouthpiecefromsalivaandmoderatetheburningofthecigaretteaswellas thedeliveryofsmokewiththepresenceofoneortworowsofsmalllaserdrilledairholes. Theburnrateofcigarettepaperisregulatedthroughtheapplicationofdifferentformsofmicro crystallinecellulosetothepaper.Cigarettepaperhasbeenspeciallyengineeredbycreatingbands ofdifferentporositytocreate"firesafe"cigarettes.Thesecigaretteshaveareducedidleburning speedwhichallowsthemtoselfextinguish.Thisfiresafepaperismanufacturedbymechanically alteringthesettingofthepaperslurry. TobaccoBlend: Theprocessofblendinggivestheendproductaconsistenttastefrombatchesoftobaccogrownin differentareasofacountrythatmaychangeinflavorprofilefromyeartoyearduetodifferent environmentalconditions. Each cigarette's tobaccoblend is made mainlyfrom the leaves of fluecured brightleaf, burley tobacco,andorientaltobacco.Theseleavesareselected,processed,andagedpriortoblendingand filling.Theprocessingofbrightleafandburleytobaccosfortobaccoleaf"strips"producesseveral byproductssuchasleafstems,tobaccodust,andtobaccoleafpieces.Toimprovetheeconomicsof producingcigarettes,thesebyproductsareprocessedseparatelyintoformswheretheycanthenbe possibly added back into the cigarette blend without an apparent or marked change in the cigarette'squality.Themostcommontobaccobyproductsinclude: Blendedleaf(BL)sheet:athin,drysheetcastfromapastemadewithtobaccodustcollected fromtobaccostemming,finelymilledburleyleafstem,andpectin. Reconstituted leaf (RL) sheet: a paperlike material made from recycled tobacco fines, tobaccostemsand"classtobacco",whichconsistsoftobaccoparticleslessthan30meshin size (~0.599mm) that are collected at any stage of tobacco processing. RL is made by extractingthesolublechemicalsinthetobaccobyproducts,processingtheleftovertobacco fibers from the extraction into a paper, and then reapplying the extracted materials in concentratedformontothepaperinafashionsimilartowhatisdoneinpapersizing.At this stage ammonium additives are applied to make reconstituted tobacco an effective nicotinedeliverysystem. Expanded(ES)orimprovedstems(IS):ESarerolled,flattened,andshreddedleafstems thatareexpandedbybeingsoakedinwaterandrapidlyheated.Improvedstemsfollowthe sameprocessbutaresimplysteamedaftershredding.Bothproductsarethendried.These twoproductslooksimilarinappearancebutaredifferentintaste. Arecipespecifiedcombinationofbrightleaf,burleyleafandorientalleaftobaccowillbemixed withhumectantssuchaspropyleneglycolorglycerol,aswellasflavoringproductsandenhancers such as cocoa, licorice, tobacco extracts, and various sugars, which are known collectively as "casings".Theleaftobaccowillthenbeshredded,alongwithaspecifiedamountofsmalllaminate, expanded tobacco, BL, RL, ESand IS. Aperfumelike flavor/fragrance, calledthe "topping" or "toppings", which is most often formulatedby flavor companies, will then be blended into the tobaccomixturetoimprovetheconsistencyinflavorandtasteofthecigarettesassociatedwitha

certainbrandname.[18]Aswell,theyreplacelostflavorsduetotherepeatedwettinganddrying usedinprocessingthetobacco.Finallythetobaccomixturewillbefilledintocigarettestubesand packaged. The SupplyChainManagement playsamajorhandintheprocess,makingtheprocessalotmore precisewithpreciseECommerceapplicationsautomatingtheentireprocessofspecificmanufacturing machineriesinvolved.NoonedepartmentinanytypicalCigaretteManufacturingunitspecializesin all the above listed tasks. The work is always distributed The Distributed Framework of manufacturing. The linking of various departments can be easily visualized and practically implementedbythesupportthatECommerceapplicationprovide.

MARKETING
BeforetheSecondWorldWarmanymanufacturersgaveawaycollectiblecards,oneineachpacketof cigarettes. This practice was discontinued to save paper during the war and was never generally reintroduced,thoughforanumberofyearsNaturalAmericanSpiritcigarettesincluded"vignette" cardsdepictingendangeredanimalsandAmericanhistoricalevents;thisserieswasdiscontinuedin 2003. However,asitstandstoday,inmanypartsoftheworldtobaccoadvertisingandevensponsorshipof events has been outlawed. In such a scenario, maintaining a relationship through the customer becomes a tricky scenario. Indian companies, like ITC, launched various ventures to improve the brandvisibility amongst the consumers, most prominently, advertising the umbrellabrand in sub urbanIndiantowns(wheretheconsumermarketisofthehighestpercentages)usingECommerce ventureslikeEChoupaletcetera.

ACCOUNTING
TheAccountingdepartmentofacompanycommunicatesfinancialinformationaboutthebusinessentityto persons such as customers, shareholders or managers. This communication is generally in the form of financial statements that show, in monetary terms, the economic resources under the control of management.This againbecomesa tricky scenario,whenone considersthesheervolume ofcigarettes manufacturedandsoldthroughouttheworldingeneralanymanufacturerspecifically.
Specifically developed E Commerce applications keep track of the various products used in the manufacturingofacigaretteandthenumberofthesemanufacturedthroughtheautomatedmachinesin the company in a certain period of time, giving exact precise figures to the accounting in terms of manufacturingcosts,discardedendproductsetcetera.

MAINTENANCE
Themaintenancephaseplaysakeyroleinanyproductorservicelifecycle,FMCGgoodsingeneral,where in,aconsumerfeedbackfortheendproductsaleofbadgoodsbecomesaveryimportantissue.ECommerce hashelpedmakethisstageofthecycleamucheasiertask,bothforthemanufacturerandtheconsumer.
Theconsumercanlistdowncomplaints,ifany,onthecompany'seportalandthecustomercomplaintscan belookedintoefficiently,dependingupontheversatilityoftheecommerceapplication,bytherespective personsintherespectivedepartmentofthecompany.