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Quality Confectionary
Quality Confectionary
QCL was a new company which spun off from its parent, the Rs. 230
crore Alaknanda Sugars.
Which is in the hands of Prem Tiwari who is son of parent company
promoter Seth Aloknath Tiwari.
He immediately started recruiting a band of professionals to run QCL.
Instead of depending on people deputed from parent company, he
recruited people from other organizations.
The top level team is of five general managers who are in charge of
marketing, sales, production, finance, personnel, were all are young
professionals.
The firm was limited to doing business out of six depots in north India where the
operations of the parent company were located.
They were keen to expand its geographical reach, Vijay Sood was specially
recruited to set up nationwide operations as Senior Manager logistics.
They were keen to expand its geographical reach, Vijay Sood was specially
recruited to set up nationwide operations as Senior Manager logistics.
And then it had depots in all the major towns in India, and the product range also
grown from 5 to 15.
And soon he moved quickly to set up systems for reporting, forecasting, and
evaluating logistics performance, and was promoted as GM logistics.
Case Introduction
Quality Confectionary limited manufacturer of the sweet tooth range
of hard boiled sweets
It started with 5 SKUs and increased to 15 after 3 years of span
It has a well established distribution network of 25 depots in different
towns in India
Introduced a new brand Choc-Elite in the market
Choc-Elite could not succeed in the market
Right time
Right Quantity
Right place
Right Quality
Right value
Measuring performance
Performance of logistics is measured on two parameters:
Service Level
Proportion of the target Made available to each depot, measured SKU wise.
Service level-90% should be maintained.
Inventory Efficiency
Closing Inventory at each depot as a proportion of its next months forecast
Inventory Efficiency-0.33 should be maintained.
A firm
target for
allowed
between
the next month
For shipment to
depots
Tentative target
for the month
after next
For drawing up
production plan
(20% variance
tentative and firm target)
Weekly sales forecast, actual sales, service level and inventory efficiency for ChocElite
W1
town
Forecas Actual
t
Service
level
Inv
efficiency
Expired
stockouts
Mumbai
20
220
78
0.8
Delhi
250
240
92
Calcutta
180
150
100
1.2
Chennai
150
100
100
1.5
Bangalor
e
120
110
89
1.1
Month wise sales forecasts V/s actuals, service levels and inventory efficiencies for
sweet tooth range
Month
Tentative Final
forecast forecast
Inventory
efficiency
October 1996
800
800
701
90
0.44
November
1996
750
700
696
88
0.50
December
1996
750
750
728
89
0.37
January 1997
800
800
838
88
0.35
February
1997
850
900
872
86
0.31
March 1997
1000
1200
1442
92
0.14
Recommendations
Production plan and shipping can be made effective if it is related with growth
rate of actual sales of different towns
An ERP system can be established for effective forecasting and ordering adequate
quantity of product
Decreasing the lead time between the manufacturer and the company depot.
Increasing the number of trucks facility from depot to Retail stores for fast
delivery with in time.
Marketing Campaign to increase the sales.
Mumbai
Delhi
Calcutta
Chennai
Bangalor
e
220
240
150
100
110
280
280
160
120
130
350
300
190
150
140
420
360
240
180
170
480
420
260
220
200
520
460
280
250
230
570
530
320
290
280
620
570
360
320
330
Thank
You..