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A PROJECT REPORT
On
INVENTORY MANAGEMENT SYSTEM
Submitted in partial fulfillment of the requirements for the award of the degree ofMASTER OF BUSINESS ADMINSTRATION
Undertaken at
HINDUSTAN ZINC LIMITED (HZL)ZINC SMELTER
DEBARI, UDAIPUR-313024
PACIFIC INSTITUTE OF MANAGEMENT DEBARI, UDAIPUR
SUBMITTED BY:GOURAV JOSHI
ACKNOWLEDGEMENT
It is a great sense of satisfaction and a matter of privilege to me to work at HINDUSTAN ZINC LIMITED, DEBARI. I wish to express my heartiest thanks to Human Resource Division for providing me the opportunity to under go training in the esteemed organization. Under such a nice environment, systematic work approach and target oriented task management of this division provided me with the much-desired training experience needed for future profession.
It is my pleasure to thank Mr. M L Nagda, AGM (PR), Mr. Akhilesh Shukla, Unit Head(ZSD), Mr. P K Jain, AGM (HR), to whom I owe a lot for giving me an opportunity to do my training in this organization; I also owe a special thanks to Mr. Arun Chaplot, AGM (Commercials), Mr. Suresh Chandra Sharma, Mgr (Sales) and Mr. Abhinav Gupta, AM (Fin.), Mr. A K Singh, AGM(P), for allowing me to do project under their guidance.
My heartfelt thanks to Mr. G P Bhattarmakki, Mgr (Commercials), Mr. Sanjay Chaturvedi, JE (Commercials) who accepted me as a project trainee in his group and helping in the projects with words of encouragement and has shown full confidence in my abilities.
The project would not be a success without the constant and valuable guidance of all the staff members at Store for the project, rendering all sorts of help as and when required.
GOURAV JOSHI
INVENTORY MANAGEMENT SYSTEM
Submitted in partial fulfillment of the requirementsFor the award of the degree of MBA.
Guides Submitted by:Internal: Mr. G P Bhattarmakki GOURAV JOSHI
External: Mr. Arun Chaplot Mr. Abhinav Gupta
DECLARATION
I do, hereby, declare that the dissertation entitled “INVENTORY MANAGEMENT SYSTEM” is an authentic
work developed by me at HZL, Debari, under the guidance of Mr. Arun Chaplot, AGM (Commercials) and Mr. G P Bhattarmakki, Mgr (Store) submitted in partial fulfillment of the requirements for the award of the degree of Master Of Business Administration (MBA) of INSTITUTE OF BUSINESS MANAGEMENT &RESEARCHAHMEDABAD.. I also declare that, any or all contents incorporated in this dissertation have not been submitted in any form for the award of any degree or diploma of any other institution or university.
GOURAV JOSHIM.B.A.(2nd sem)
Table of ContentsS.No. Topic
Chapter-1 Introduction to the Topic
Chapter-2 Objective of Study
Chapter-3 Research Methodology
Chapter-4 Literature Review
Chapter-5 Industry Analysis
Chapter-6 Material Management an Overview
Chapter-7 Data Analysis &Findings
Chapter-8 Suggestions
Chapter-9 Appendix
CHAPTER 1
INTRODUCTION
TO THE TOPIC
1. INTRODUCTION
We all depends for some commodities and services provided by other individuals or organizations. Similarly, every organization, big or small, to varying extents, depends on materials and services from other organizations. These materials and services are obtained through exchange of money. Materials constitute an important ingredient of inputs to the activities of the several types of organizations. Industries require raw materials, components and equipments for their production, service organizations require supplies, and spare parts for maintenance, operations and so on. In most of the organizations, about 40 to 60% of the total money is spent on materials and related
services. Even in a majority of manufacturing organizations it is 60 to 80% of total cost. Purchase Management- The basic purchasing principles are buying materials of right quality, in the right quantity, at the right time, at the right price, from a right source and also at the right place.
Inventory Management- Maintaining stock, for a given financial investment, an adequate supply of something to meet an expected demand pattern. This could be a raw material or the spares work in progress finished products or the spares and other indirect materials. Inventory can be one of the indicators of management effectiveness on the materials management front. Inventory turnover ratio (annual demand /average inventory) is an index of business performance. A soundly managed organization will have higher inventory turnover ratio and vice-versa. Inventory management deals with the determination of optimal policies and procedures for procurement of commodities.
Stores Management- As all the activities in any
organization cannot be carried out at one point of time,
storage is an inevitable process. It increases the value of the
material by simply carrying it overtime; no transformation of
any characteristic is desired. Thus stores in any company
have a vital role to play. All other activities involving
material are in day-day touch with the stores. The success of
the business depends to large extent on the efficient storage
and material control. Material pilferage, deterioration and
careless handling may lead to reduced profits. Stores
management is concerned with carrying the right kind of
materials in right quantity, neither in excess nor in short
supply, providing it quickly as and when required, keeping it
safe against any kind of deterioration, pilferage or theft, and
to carry out the efficient performance of all these functions
at lowest possible cost.
Waste Management-The diverse and seemingly boundless
developments taking place in industry bring with them a
whole new series of complexities associated with waste.
Waste is an unnecessary input to or any undesirable output
from any system encompassing all type of resources. Waste
management is a multidisciplinary activity involving
engineering principles, economic, urban and regional
planning, management techniques and social sciences, to
minimize the overall wastage of the system under
consideration. However as the material constitutes a major
fraction of the total product cost, materials wasted has the
critical importance.
1.1 MATERIALS MANAGEMENT - A PROFIT CENTRE
Materials management was treated as a cost centre in
earlier years, since purchasing was spending money & stores
was holding huge inventories, blocking money and space.
With the process of liberalization and opening up of global
economy, a drastic change in the business environment,
resulting in manufacturing organizations exposed to intense
competition in the market. Indian industries have also been
working out various strategies to cut down manufacturing
costs to remain competitive. Progressive managements have
since recognized that Materials Management can provide
opportunities to reduce manufacturing costs and can be
treated as a Profit Centre.
1.2 SAILENT FEATURES OF MATERIAL COST CONTROL:
The salient features of material cost control are as under:
a) The quality and specification of materials shall
commensurate with the requirements of the product, so that
neither too expensive or superior nor cheap or inferior
material shall be selected for use in product.
b) The purchasing shall aim at minimum price to suppliers
and timely procurement and shall avoid urgent purchase at
higher cost.
c) Storage of materials such that there will be neither
overstocking, and thereby blocking capital, nor running out
of stock and creating interruption in production process.
d) Wastage and losses shall be avoided at every stage of
operation i.e. from storing till usage in production.
e) Materials should be classified and accounted for both in
physical units and value in such a way that information
about availability in stock can be obtained promptly so as to
assist production, planning as well as timely buying.
1.3 CLASSIFICATION OF MATERIAL COST:
Broadly Cost can be divided in two major categories i.e.
direct cost and indirect cost. Similarly we divide the material
cost in these categories for analysis. Material cost relate to
both direct and indirect materials.
1.3.1 Direct material cost:
The direct costs are those which can be identified with or
related to the product or services, so that an increase or
decrease to the product and service will affect the cost
proportionately. In other words we can say direct material
cost are relates to those materials, which enter in to and
form part of the product, such as flour, fat and sugar in
biscuits. Direct material cost includes:
a. All material specially purchased for a job order or
production.
b. All materials issued from the stores against a particular
job order or production.
c. All components or assembly parts purchased for use in
the jobs or production activities directly.
1.3.2 Indirect material cost:
Indirect cost on the other hand cannot be identified or
traced to a given cost object in economical way and are
related to the expenses incurred for maintaining facilities or
services. In direct material cost includes:
a) All materials or processed materials transferred from one
process or operation to the other.
b)All primary packing materials such as poly bag, gunny bag,
card board box etc. indirect materials are those which
cannot be traced as a part of the product, such as -
i) Consumable stores used in the operation.
ii) Lubricating oil, grease fuel oil etc.
iii) Tools, jigs and fixtures etc.
iv) Sundry stores of small value like cotton
waste, broomstick etc.
1.4 CLASSIFICATION OF COST ASSOCIATED WITH
MATERIALS:
The optimum decision is one, which minimizes the sum of
the total costs associated with materials. These costs are of
three types.
i) Cost of obtaining goods (procurement cost) through
purchasing or manufacturing.
ii) Cost of handling the inventory (inventory carrying
cost). This involves such contributory costs as the
cost of money spent in storing the inventory,
handling, obsolescence, damage, insurance and
taxes etc.
iii) Stock out cost. This is the cost associated (or loss
incurred) with either delay in meeting the demand or
the ability to meet stores at all.
iv) Wastage / Scrap / Obsolescence cost
A) PROCUREMENT COST:
Cost of procurement consists of the cost placing an order,
setting up of production run, transportation and receiving
cost. The following are the expenses, which are involved in
procurement cost.
- Staff’s salary purchase, I.C. Cell and receipt section.
- Printing, stationary and typing expenses.
- Tendering cost (Advertising).
-Follow up cost (Telephone, telegram, telex, postage etc.).
- Receiving and inspection cost (laboratory testing etc.).
-Transportation cost (Freight, Octroi, demurrage etc.)
-Rent/depreciation of building and infrastructure used by
purchase, and receipt section.
-Cost of source development.
-Cost of entertaining the suppliers.
The sum total of these costs is called the purchasing cost.
The purchase cost incurred during a year divided by a
number of order issued will give the cost per order.
Purchasing cost can be very high if system and procedures
are faulty; one of the important roles of materials manager is
to ensure that purchasing cost should be minimized.
B) INVENTORY CARRYING COST:
When stocks are carried in the warehouse, various costs are
incurred to maintain these stocks. When inventories are
stored we are strictly storing company’s money. This attracts
a huge interest rate. These costs are called as inventory
carrying cost.
Inventory carrying cost includes following expenditures:
Interest: interest on the money locked up on the materials
stocked (called inventories). This can amount as much as 18
to 20% depending up on the bank rate or other rates at
which the money has been borrowed.
Taxes: Taxes are payable.
Insurance
Obsolescence
Shrinkage
Evaporation
Deterioration
Rent / Depreciation
Labor Costs
Overheads
All these added up together will constitute inventory-
carrying cost and this is usually expressed as a percentage
of the total value of inventory held. This can be as high as 25
to 30 % under today’s conditions.
C) STOCK-OUT COST
This is the cost associated with either in delay in meeting the
demand or inability to meet it at all due to shortage of stock.
The determination of stock out or shortage cost is
approximate and arbitrary in nature but their significant
should not be ignored. Though we are not paying this type of
cost in cash but it indirectly incurred by downing the
company’s profit/production activities due to non-availability
of stress at the time of their need. This is very dangerous
situation and we have to avoid this type of occurrences. By
no availability of raw materials/ stores, production activities
are held up and by responsibility of materials manager to
ensure the continuity of supplies of stores/ raw material.
D) Wastage / Scrap / Obsolescence cost
Wastes can be classified in a variety of ways depending
upon the purpose for which classification is done. There
could be four basic classifications as follows:
a) On the basis of property: depending upon the property
that effects the environment, waste may of two types:
i) Hazardous and
ii) Non-hazardous
b) On the basis of reusability: as per the characteristic of
resource the waste may be:
i)Reusable: the waste that can be converted in the useful
resource.
ii)Non reusable: this includes the resources that are lost
with time and cannot be regained afterwards.
Due to expansion in capacity and installation of new latest technology equipment & systems and installation of Wartsila DG Sets, some equipment/ spares are bound to be obsolete/ surplus and number of stock items is bound to be increased. Focus is needed to dilute these NMI, Obsolete & surplus
items at the earliest possible. The motto should be utilize or realize is worth praising.
Concepts & Techniques: Materials department is involved in the following activities, viz.
Inventory (stock) control Purchase and procurement Stores function-Receipt and inspection
-Storage issue and accounting Material control
Some of important definitions and activities are
highlighted in short.
A. INVENTORY (STOCK) CONTROL: Stock level are maintained in such a way that there is no
over-stocking, so that chances of loss through damage,
deterioration in quality, risk of obsolescence etc are avoided
along with unnecessary blocking of capital or paying interest
on borrowed funds. At the same time there shall be no
stock-out situation, leading to interruption or production and
loss of sale and profit. The production planning and control
or material control department look after this aspect of
stores management by fixing maximum, minimum and
ordering level and reorder quantity for stock item i.e.
standardized items of regular use. Within these guidelines
noted in each bin card, the storekeeper places requisitions
with the purchase department for replenishment of stock.
B. Reorder level
This is the level at which the storekeeper initiates purchase
requisition for fresh supplies of materials. Re-order level
takes in to account the maximum consumption during the
lead-time and unexpected delay in receiving fresh supply.
Lead-time means time necessary to obtain delivery of
materials from date of order. In case of unusual delay, stock
should not reach zero level. Re-order level is therefore,
calculated as maximum re-order period multiplied by
maximum consumption.
C. Minimum Level:
This represents a level at which the stock will reach at
minimum level Stock is normally not allowed to fall below
this level. This is considered as buffer stock for use in
emergency. If however stock level falls below minimum level
it will be called “danger level”, when emergency measure
should be taken to replenish stock, otherwise there will be
stock-out situation with consequential loss of production.
Minimum level is therefore computed as reorder level less
normal consumption during normal reorder period.
D. Maximum level:
This represents stock level above which stock should not be
allowed to rise. The main purpose of this level is to ensure
that capital is not blocked up unnecessarily in stores. The
maximum stock level is computed as reorder-level plus re-
orders quantity minus consumption during reorder period.
This level is a control indicator, and if the stock exceeds this
level the consumption pattern and reorder period should be
reviewed. The maximum stock level is fixed after
considering the following factors also:
i) Storage facilities available.
ii) Cost of maintaining stores including insurance cost.
iii) Availability of funds.
iv) Possibility of loss by deterioration, evaporation etc. and
risk of obsolescence.
v) Possibility of price fluctuation. For instance, in case of
seasonal materials, price may be low in season and
high in off-season.
vi) Government restriction on import or procurement.
vii) Economic order quantity.
E. Stock Turn-over and Average Stock-Holding:
Stock turnover ratio indicates how many times stock is
rotated, on an average during a particular period, say a
year. This is calculated for different groups of materials
separately in the following way:
Cost of material used during the periodStock turn-over ratio= --------------------------------------------- Average stock during the period
Average stock holding is obtained by averaging:
a)Opening and closing stock
b)Maximum and minimum level of stock or
c) Minimum stock + half of re-order quantity.
F. Reorder Quantity:
This refers to the quantity to be covered in a single purchase
order. While deciding the reorder quantity, the following
factors are considered:
a)Consumption pattern of the material.
b)Nature of the material i.e. risk of deterioration,
evaporation etc.
c) Risk of price fluctuation.
d)Seasonal consideration as to the price and availability
of supplies.
e)Storage space availability.
f) Quantum discount.
g)Carrying cost and ordering cost.
G. Economic order quantity:
The concept of economic order quantity or EOQ has
emerged out of this behavior of carrying cost and ordering
cost. EOQ is the quantity fixed at a point where total cost of
ordering and the cost carrying the inventory will be
minimum. The formula of finding the EOQ is as follows:
________________________________ 2*Annual requirements *Cost per orderE.O.Q. = -------------------------------------------------- Cost per unit of material *Carrying cost EOQ model is based on the following assumptions:
a) Material cost per unit remains unaffected by order
size.
b) Order will be received on the expiry of lead-time.
c) Variable inventory carrying cost per unit and ordering
cost per order remains constant through out the order.
d) Production and sales can be forecast perfectly.
H. A.B.C. Analysis:
The technique of A.B.C. analysis is basic technique of
inventory control. This analysis does not depend on the unit
cost of item, but only on its total annual consumption. It
does not depend on the importance of items. In this
technique all item are necessary and important.
In this analysis certain limits of consumption value are set
for each of the categories (i.e. A, B, C) depending upon the
size of the organization, the number of the items and the
total value-wise consumption. The small numbers of high
consumption value items are called ‘A’ class items, which
are around of the total items and will be responsible for
about 80%value of the total consumption.
The medium consumption value items are termed as ‘B’
class items, which are around 20% of the total items and will
account for about 15% percent value of the annual
consumption. The large number of items whose annual
consumption value is very low are ‘C’ class items which are
the balance 70 %of the items and will cover only 5%of the
cost.
A.B.C. analysis gives rise to selective inventory control
in which maximum attention can be given to ‘A’ class items,
a amount to ‘B’ class items, while attention necessary for ‘C’
class items can be reduced to routine procedure. Selective
control of inventories based on A-B-C analysis can follow the
broad pattern.
I. X.Y.Z. Analysis:
The XYZ analysis is based on the value of inventory stored.
XYZ is the value of inventory available as on particular date.
The exercise is done once in a year during the annual stock
verification. This analysis helps to control obsolescence and
tells how to distinguish amongst material in stores.
X items are those items whose stock value is highest and Z
items are those which are having low value. Y items fall in
between two categories. The classification helps to identify
the items of which stock are very high.
X class Items: a critical analysis must be done to reduce
stock. Consumption and stock should be reviewed
frequently. Steps should be taken to dispose of surplus
stock.
Y class items: attempts must be made to convert to Z
category. Further action in control may not be necessary.
Control should be tightened.
Z class items: items are within control. These are can be
reviewed twice in year.
J. Perpetual Inventory System:
It is defined as a system of records maintained by the
controlling department, which reflects physical movement of
stock and their current balance. In other words it is a
technique of controlling stocks by maintains stock records,
such as bin cards in stores and stores ledger in accounts, in
such a manner that the stock is available at any point of
time i.e. perpetually. Under this system, stores balance is
recorded after each transaction of receipt, issue or transfer.
This facilitates regular stock cross checking physically.
K.Insurance Spares:
Many machines are proprietary and imported. The spares
were invariably imported along with the machines. The
spares, which are functional parts of the machines. In most
cases, the parts are stable and never failed, but one cannot
give guarantee of performance and one has to keep spares
as insurance.
Insurance spares are defined as parts or complete
assemblies usually of high value which are not normally
required for routine maintenance but which will be needed
in the event of an unforeseen breakdown, to avoid shutdown
of a vital piece of equipment.
4.1 Training under different departments-
1. PRODUCTION DEPARTMENT:
The production of Zinc ingot is the main product of the production process. Zinc ingot is obtained after the completion of process through various departments.
ROASTER AND ACID PLANT-
Zinc concentrate at DZS comes from three mines, namely, the Rampura Agucha mines, Zawar mines & Rajpura Dariba mines. Zinc concentrate is fed to roaster by variable speed belt conveyer in a particular ratio which is 50%, 37%, 13%, respectively temperature maintained in roaster is approximately 950degree centigrade. The gases coming out of roaster are passed through waste heat boiler & get cooled to 350 degree centigrade calcine by the gases fall here & are Collected in hooper. Further gases are passed through cyclones & hot gases from different source cooled in conveyers & sent to leaching plant silos.
Sulphur di –oxide bearing gases are first dried in a drying tower with H2SO4 to reduce the moisture content of the gases. Dried gases are subsequently heated in shell &tube type heat exchanger to a temperature of 400 degree centigrade. The heated gases re passed through V205
Catalyst fed in a inverter where SO3 which is absorbed in absorption towers. By further processing it changes into H2SO4. This acid is by product for the company. Just 10-
20% acid is used in the plant, 80% goes to the market & is used in the fertilizers.
LEACHING, PURIFICATION AND CADMIUM PLANT-
Neutral Leaching
Calcine, which consists of oxides of Zinc and other metals,
Zinc ferrite and unconverted sulphides is leached is
continuous process with spent electrolyte 9 weak sulphuric
acid from electrolysis) to a PH of 5 soluble oxides get
dissolved producing respective sulphates. Manganese di-
oxide is added to oxides ferrous and other impurities. The
neutral slurry is settled in the Dorr-thickeners. Flocculants is
added as a settling aid. The clear overflow is further purified
for electrolysis whereas the solid residue is pumped from the
bottom of thickener to Acid leaching.
Acid Leaching
The underflow from neutral thickener containing un
reacted Zinc oxides and Zinc ferrite is leached with spent
electrolyte to a pH of 2.8 at a temperature of about 80°C.
Alternate reactors are provided with heating coils through
which steam is passed. In this process most of the acid
soluble oxides go into solution. The slurry is settled in dorr-
thickners. The overflow is sent to neutral leaching underflow
is continuously pumped to fitters where the solids are
separated filtrate is pumped back to the thickner.
The overflow (ZnSO4 Solution) is them sent for purification.
Here zinc goes into the solution and impurities like Cu, Col,
Ni, Co, Ge, and Sb are precipitated. Then they are passes
through a series of fitter press to fitter the impurities.
Jarosite cake is sent to the pond and Cu-Cd cake is used as a
raw material to produce cadmium. The purified solution is
then sent to ZE plant and H2SO4 is recovered back into the
leaching plant.
ZINC ELECTROLYSES AND MELTING PLANT-
It consist of 560 number of concentrate lead lined HDP liner cells divided in three circuits of 240, 160& 160 cells each . First circuit of 240cells operates at 10 kilo ampere & the remaining 2 circuit of 160 cells each is operated at 15 kilo ampere each.The spent electrolyte added to purified ZnSO4 solution being pumped to cell house to maintain the PH of 3.5 before being cooled in atmospheric coolers. Gypsum removal take place in the super settler & the cooled neutral solution is stored in storage tanks. The neutral solution is then added to the re-circulating cooled spent electrolyte at the rate to maintain
the desired Zinc to acidity ratio of 30 liters per minute to each of the cells through a system of FRP launders. Gum Arabic is added to the electrolyte to improve the texture of the Zinc cathode sheets as surfactant.The cells of the concentrate provide with HDPE lining in which the electrodes are placed. These are three different circuits with each having its own DC power source. The anodes are 0.5% Ag- Pb & the cathodes are of aluminum Zinc deposits on the cathodes & MnO deposits on the anodes. The Zinc is allowed to deposit for a period of 24 hours after which the electrolyte sheets are stripped out manually. The Zinc cathode sheets obtained from stripping is weighted & melted in induction furnaces; these are namely, Demaj & Ajax. Finally these are castled. The recovery efficiency of Zinc is 99.95% approximately. In the process, firstly Zinc plates are prepared & by that Zinc bricks are made. Each brick weight 25 kg.
2. SERVICE DEPARTMENT:
The departments which are indirectly engaged in the production of Zinc by providing some sort of service to the production departments. They are categorized as under:
PERSONNEL & ADMINISTRATION DEPARTMENT-
Personnel & administration department is a crucial department as it is concerned with management & operating functions with a view to attain the organizational goals economically & effectively & meeting the individual & social goals. It checks the working of the following functions:
Time office Administration Welfare Establishment section- workmen establishment
- Executive establishment
INDUSTRIAL ENGINEERING CELL- Industrial engineering is a science which develops methods, processes to provide an interface between man, machine, and material &minutes to have an optimum output. To achieve this cell makes the use of:-
Incentive scheme Suggestion schemes Human resource department Work study of system & matrix Value engineering Ergonomics
SAFETY DEPARTMENT- Safety department look after the safety of the people working in the smelter & factory by providing all the necessary safety equipments to protect from he acid &harmful gases. It keeps vigilance on the safety conditions prevailing in the whole organization.
STORES DEPARTMENT-
Store department deals with the management of material. It helps in controlling the inventory &keeping a check on the requirements on the various materials. In brief, it has the following functions:-
- Procurement of material - Storage- Issue of material- inventory controls
SALES DEPARTMENT-
All sales are affected through the central Marketing office, New Delhi .The interested parties contact this office. The selling price of Zinc ingot is the monthly weighted average of the price quoted by the London metal exchange. 30 days interest free plus 60 days, interest bearing credit at the rate of 14% per annum will be allowed against confirm L/C &B/G all grades of Zinc without any quantity restriction.
For any delay beyond approved credit policy interest at the rate of 24% will be charged.
FINANCE DEPARTMENT-The main function of accounts department is to keep
systematic record of all financial transaction.
Finance department is further divided in six sections:-
1. COSTING/ BUDGETING SECTION2. BOOK- KEEPING SECTION3. CASH SECTION4. CONTRACTOR SECTION5. EXCISE & MODVAT SECTION6. ESTABLISHMENT SECTION
4.2 Problem faced at the time of training-
Basically HZL, Debari is a Smelting Plant. The process on Ore is done here to extract the Zinc, Cadmium and other non ferrous metals found in the Ore.
It is a chemical Industry and without being known to chemistry it is very difficult to understand the process of the plant.
The risk of being contracted to any hazardous chemical is always there but as all the safety measures are taken and the safety training was given prior to the Trainees the risk is somehow eliminated.
It was seen that in some SBUs the Mentor was not present for tackling the trainees or he or she was busy in the plant so a long wait has to be done to meet the concerned Mentor.
The plant process of SBU 1 and SBU 2 is controlled through DCSS (Digital Control Server System) which is managed by Honeywell Company. Without being known to Computer Architecture and the computer systems.
The material identification was difficult task because the parts in the stock were more than 5000.
4.3 Suggestions to Improve-
The Mailing system to all the Dept. should be maintained well and the system of Induction Program should be improved.
The Lectures or Seminars can help students more so a Lecture or Seminar should be conducted before going into the plant.
A person should be appointed to guide the students during there Induction.
An interactive session should be conducted at the end of the Training.
The cooperation level should be maintained high.
CHAPTER 5
INDUSTRY ANALYSIS
&
COMPANY PROFILE
Industry Analysis
5.1 Global Level-
The two contemporary technologies are roast-leaching electrolysis and Imperial Smelting process (ISP). 80% of production of zinc in world is by electro-winning process and
14% by ISP. The global production at present is about 7.2 million tonne (28% production is from Western Europe, 22% from USA, 21 % is from Asia and erstwhile USSR and China produces about 27-28%).Production of zinc in USA, Europe and UK has decreased as a result of decline in mining of zinc ore and concentrates. Manufacture of Zinc in these countries is dependent on import of concentrates. Canada, Peru, China, former USSR have increased their production of zinc and there is increase in capacity build-up in Canada, Peru, China, India, Brazil, Mexico and some other countries.
(Data in thousand metric tons of zinc content unless otherwise noted)
According to an forecast from the International Lead and Zinc Study Group, in 2008, global zinc mine production increased by 3.9% to 11.6 million tons, refined metal production by 5.1% to 11.9 million tons, and consumption by 3.8% to 11.8 million tons. This leaves an excess of 150,000 tons of metal on the market, with a larger surplus anticipated in 2009. Increased mine production was driven by expansions in Latin America and increased output in China, India, Iran, and Kazakhstan. Metal production rose as a result of increased output in China and India. A decline in zinc consumption in Europe and the United States during the year was offset by increased consumption in countries with emerging markets, particularly China, as well as Brazil and India. China’s continued growth in demand was supported by the increased production of galvanized products—especially those used in transportation (highway barriers) and communication (galvanized iron towers) infrastructure. Zinc prices continued to decline during 2008 as the metal market remained in surplus over the year. The LME cash price for zinc in October 2008 averaged $1,301 per metric ton, an approximate 70% decline in value from its peak reached in 2006. A wave of zinc mine closings and cutbacks (particularly in Australia, Canada, and the United States)
began around midyear as prices began to fall below operating costs, and a few smelters announced production cutbacks towards the end of the year in order to prevent an accumulation of stocks. Mines in New York and Tennessee closed in 2008 because of low zinc prices.
World Resources: Identified zinc resources of the world are about 1.9 billion metric tons. Substitutes: Aluminum, plastics, and steel substitute for galvanized sheet. Aluminum, magnesium, and plastics are major competitors as die-casting materials. Aluminum alloy, cadmium, paint, and plastic coatings replace zinc for corrosion protection; aluminum alloys substitute for brass. Many elements are substitutes for zinc in chemical, electronic, and pigment uses.
5.2 Indian Level-
The country is endowed with huge resources of many metallic and non-metallic minerals. Mining sector is an important segment of the Indian economy. Since Independence there has been a pronounced growth in the mineral production both in terms of quantity and value. India produces a many as 86 minerals which include 4 fuels, 10 metallic, 46 non-metallic, 3 atomic and 23 minor minerals (including building and other materials).Zinc industry in India is going to witness another era of transformation with the commencement of trial production on Vedanta Resources’ expansion project. With the mounting pressure on imports that forcing integrated producers to expand capacities in order to meet the skyrocketing demand,Vedanta Resources plc, the London-listed metals and mining major, brought new life to zinc industry which is expected not only to continue the overall industry’s growth saga but to supply to the rest of the world within no time.The Indian zinc industry entered its transformation phase with the privatization of the largest zinc producer, Hindustan Zinc Ltd, in favour of the Sterlite Group in April 2002. The
domestic zinc industry is now completely under the private sector and is in the midst of a serious expansion programme. By 2010, India is expected to attain complete self sufficiency in meeting its zinc demand.
The government has chalked out enormous infrastructure development plans which if in would consume a hot of galvanized steel. As no galvanising in predicted without zinc, therefore, zinc consumption is expected to boost in India. Zinc demand is estimated to grow at 12 to 14 per cent per annum mainly due to increase in galvanizing capacity, which accounts for 70 per cent of zinc metal consumption in the country. The Indian lead industry is estimated to grow at a pace of 8 per cent per annum. The main driver for this growth is the automotive and UPS/ Inverter segment. Therefore, the future looks bright.
5.3 Major Players in Industry
Top zinc producing companies: XStarta plc,
OZ Minerals, Teck Cominco Ltd,
Glencore International AG, Hindustan Zinc,
Anglo American Plc, Volcan Compania Minera S.A.A.,
Boliden AB, Votorantim Metais Ltda,
Lundin Mining Corp.
Top zinc producing mines: Century,
Rampura Agucha, Red Dog,
Iscaycruz, Brunswick #12 Mine,
Greens Creek Mine,
Mt. Isa, Tara Mine, Lisheen, Antamina
Top zinc producing countries: China, Peru,
Australia, USA,
Canada, Mexico,
Kazakhistan,
5. ts, first is central purchase situated at head office ( for fuels
FO, LSHS, Coke etc.) and working under of head of
commercial division. The commodity coordinators for
chemicals & mining items is located at RA Mines and for
general consumables like Bearings, Pipes, Hardware,
Packing materials, Industrial gases etc is situated at CLZS.
Second is unit level purchase section under the direct
control & supervision of unit materials head.
All policies and procedures related to materials management
are decided including preparation of purchase manual at
corporate office at Udaipur and followed by all the units.
6.2.1 CENTRALIZED AND DECENTRALIZED PURCHASE:
Centralized purchase group is working at three locations. At
Udaipur corporate office for Fuels & Lubricants, At RA mines
for mining items & chemicals and at CLZS for other common
consumables.
Each unit sends their annual requirements as per Business
Plan consumption norms to CPG. Requirements of all the
units are scrutinized & consolidated and further procurement
action is taken. H.O. places order in bulk providing quantity
distribution for each unit and delivery schedule is given by
Units to the supplier.
Decentralized purchase: At unit level a separate purchase
section is also functioning, who fulfills the requirements by
purchasing those items which are not common in use at
various units and are having medium and low value, except
the centralized items, this is called decentralized purchases.
User department raise PR which are also consolidated if
requirement is common for more than on user and
procurement action is taken.
6.3. INVENTORY CONTROL AND MANAGEMENT
Inventory may be defined as usable but idle resource” Inventory can be one of the indicators of the management effectiveness on the materials management front. Inventory turn over ratio (annual demand / av. Inventory) is an index of business performance. A soundly managed organization will have higher inventory turn over ratio and vice-versa.
Inventory management deals with the determination of optional policies and procedures for procurement of commodities. Since it is quite difficult to imagine a real work situation in which the required material will made available at the point of use instantaneously, hence maintaining inventory becomes almost necessary. Thus inventories could be visualized as necessary evil.
An inventory system may be defined as one in which the following costs are significant:
cost of carrying inventories (holding cost) cost of incurring shortage (stock out cost) cost of replenishing inventories (ordering cost)
Importance of inventory management:
Scientific inventory management is an extremely important problem area in the materials management function. Materials account for more than half the total cost of any business and organisations maintain huge amount of stocks, much of this could be reduced by following scientific principles, Inventory management is highly amenable to control. In the Indian Industries there is substantial potential for cost reduction due to inventory control. Inventory being a symptom of poor performance we could reduce inventories by proper designing of procurement policies by reduction in
the uncertainty of lead times by variety reduction and in many other ways.
6.4. STORES MANAGEMENT
Stores in any company has vital role to play. As all the activities in any organization can not be carried out at one point of time, storage is an inevitable process. It increases the value of the material by simply carrying it overtime; no transformation of any characteristics is desired. In a majority of manufacturing organizations material constitutes the major fraction of cost, i.e. 60 to 80% of total cost and the capital blocked in inventories is substantial. As such the success of the business, besides other factors, depends to a large extent on the efficient storage and material control. Stores management is concerned with carrying the right kind of materials in right quantity, neither in excess nor in short supply, providing it quickly as and when required, keeping it safe against any kind of deterioration, pilferage or theft, and to carry out the efficient performance of all these functions at lowest possible cost.
6.4.1 MAJOR FUNCTION OF STORES
Receipt: Receiving and accounting of raw material, bought out parts, spares, tools, equipment and other items.
Storage: provision of right and adequate storage and preservation to ensure that stock do not suffer from damage, pilferage or deterioration.
Retrieval: facilitating easy location and retrieval of materials keeping optimum utilization.
Issue: Fulfilling the demand of consumer departments by proper issue of items on the receipt of authorized requisition.
Records: To maintain proper records and update receipts and issues.
House-keeping: Keeping the stores clean and in good order so that all functions can be carried out satisfactorily.
Control: Keeping a vigil on the discrepancies, abnormal consumption, accumulation of stocks etc. and enforcing control measures.
Verification: Verifying the bin card balance with physical quantities and initiating the purchasing cycle at appropriate time to avoid stock out situation.
Co-ordination and co-operation: To Co-ordinate and co-operate with the interfacing departments such as purchasing, manufacturing, planning and control.
6.4.2 STORES SYSTEMS AND PROCEDURES:
The systems and procedures of stores can be broadly categorized under four heads viz. (a) Identification system, (b) receipt system, (c) storage system and (d) issue system.
(a) IDENTIFICATION SYSTEM
The stores management is concerned with design and control of the systems utilized in conducting the stores activities. A large number of materials are being handled by a typical store. Thus the development of an unambiguous and efficient identification system is the first requirement of stores management so as to facilitate clear internal communications.
The physical description of each item is usually lengthy and imprecise to be taken for the purpose of identification in day to day operation. Moreover, it can not be operated on mechanical or electronic computing devices, the use of which is increasing everyday in automating the clerical operation of stores.
The need to develop a proper identification system to co-ordinate the activities of purchasing, inventory control and stores with possible integration with the operations of design engineering, production and cost accounting is a must.
(b) RECEIPT SYSTEM
The stores department receives the stores both from outside suppliers and internal divisions and accordingly there are separate receipt systems. The system of receipt starts with the placement of purchase order, a copy of which is sent to stores. This is maintained in chronological order, so as to give an idea at any time about the volume of receipt and helps in the planning of receipt, unloading unpacking and other related activities. The supplier normally sends dispatch advice at the time of dispatching goods and subsequently consignment note for clearance of goods. On actual delivery the receipt section unpack the goods and check the quantity and condition of goods and tallies with packing slip, invoice and purchase order.
The ‘Material Received Report’ sent for inspection to ensure that received material is as per purchase order specification. Duly accepted materials sent to stores and any rejection or shortage or breakage is dealt by receipt section separately.
(C) STORAGE SYSTEM
Physical System: The design of proper storage system is
very important for easy location, proper identification and
speedy issue. The commonly followed physically controlling
stores materials are: closed and open stores system. A
single firm can follow combination of these systems
depending upon the nature of production, operation and the
use of material.
(i) Closed Stores System: In such system all materials are
physically stored in a closed or controlled area, usually
kept in physical control by lock. Entry and exit of
materials from the area is permissible only with the
accompaniment of authorising document.
(ii) Open Stores system: In this system, no separate
storeroom exists. The material is stored as close to the
point of use as is physically possible. The storage
facilities are arranged at each workstation as per
requirement and availability of space. The storage
facilities are open and workers have direct access to it;
no authorisation documents are needed.
Stores Records System: Development of appropriate
recording system for stores is important to provide right
information regarding the physical inventory and accounting
of transaction. Two records are usually kept of materials
received, issued or transferred, namely, on bin (stock) card
and in the Stores ledger.
Issue System: This is the last stage in the storage system.
Issue can be of two kinds, i.e. issue to consuming
department and issue to outside supplies for processing.
STORE ACCOUNTING SYSTEM
Stores accounting is important from the point of view of
estimating the cost of the production for pricing decisions.
The costing of material has to be done both for the materials
consumed in the production and estimating the value of
materials held in stock.
Accounting is to be done for the issue to production and of the stock held at the end of accounting period. Some of the important and frequently used stores accounting systems are FIFO, LIFO, Average cost system, Market value and Standard cost system.
STOCK VERIFICATION SYSTEM
Some discrepancies between the actual and the book balance of inventories are bound to occur despite the diligent stores keeping. The purposes of stock verification are as follows:to reconcile the store records and document for their accuracy and usefulness.
To identify areas deserving tighter document control, To back up the balance sheet figures and To minimize the pilferage and fraudulent practices.
STORES LOCATIONThe location of stores is a strategic decision which if once taken can not be easily undone. It would be extremely costly to change the storage location at a later stage. It should be
carefully decided and planned so as to ensure maximum efficiency. The optimal location of stores minimize the total transportation, handling and other costs related to stores operations and at the same time provides the needed protection to stores items. Stores location depends upon the nature and value of the items to be stored and frequency with which the items are received and issued. Also the number and location of end users, verity and volume of goods to be handled, location of central receiving station and accessibility to rail or road links are important factors to decide the location of stores.
In Zinc Smelter, Debari, six separate godowns are located in central store yard. Besides this maintenance department has there own sub stores to meet out immediate requirement and for storage of damaged / repaired stores & spares. The main store (central store) is divided mainly in two sections e.g. receipt section and custody section.
The material stored in various stored located in Central Stores Area according to type & nature of material.
A Godown – Rubber items, Valves, Packing materials, Hard wares etc
B Godown – Mechanical Spares & DG Spares C Godown – Electrical & Instrument items, Safety items Chemical Godown– Chemicals Godown No. 2, 9 & 11 – Aluminium sheets, Heavy
equipment & Spares, Open Yard- Structural & reinforcement Steel, Pipes,
Cables etc.
At present stores is having inventory of 5.63 Crores and number of items is 5056 (2000 Nos. Nil stock). The group is also divided according to nature and major group of the material. All materials are codified by a 12 digit codification system.
When the material is received from receipt section, custody
section takes the material in his charge and checks
according to GR and put at designated location. Whenever
demand arises, the user department raises the stores issue
voucher (Reservation) subscribing the description, material
code and quantity needed. The custody section checks its
balance and issue material to demanding department.
The accounting of receipt and issue of material is being
maintained in SAP. When the user department returns any
unused material it is also received by custody section and is
stored after making necessary accounting entries through
Stores Return Note.
CHAPTER 7
ents procures such material of right quality and right
quantity from various suppliers, the stores receives and
stores them after quality approval from user department and
finally issues them to user department. Thus it is evident
that a perfect coordination between these departments is
absolutely necessary in order to keep the cost under control.
Otherwise situations like stock-out, production loss, distress
purchase at higher rates, wastage due to wrong quality etc.
in big organization a material is created to coordinate the
activities of sales, production, purchase, stores quality
control and accounts departments. Thus essential
requirement of the system encompasses the following:
a) Classification, codification, standardization and
rationalization of all materials.
b) Determining standard or norm for consumption of stores
as well as stock holding at various levels.
c) Use of standard forms and documents.
d) Planning of material requirements by reviewing sales
plan, position of finished stock and work in process,
production plan, stock status in stores, and expected
arrival as per order placed.
e) Continuous updating of stock position with the information
available from purchase, stores, production and dispatch
departments.
f)Arranging conversion of raw material in to components
through converters or contract labor.
g) Preparing regular reports to management indicating stock
holding, excess storage, slow moving, ordering position,
consumption, critical items, non-moving dormant, surplus
and obsolete stocks etc. by quantity value.
7.3.3 MATERIAL CONTROL FOR COST REDUCTION:
A) STAGGERD DELIVERY FOR HIGH VALUE ITEMS:
Delivery schedule for high value items is given to the
supplier in fraction of low quantity as minimum requirement
in that schedule. By this staggered delivery schedule the
benefits of low inventory is obtained.
These schedules are given in consultation with the user
department. For staggered delivery the ordered quantity is
periodically divided according to the consumption. The
supplier delivers the material as per schedule. By this
inventory can be controlled, which reduces the cost of
material. Staggered delivery is generally given for high
valued items as well high consumption items.
B) INTER UNIT TRANSFEER OF SURPLUS ITEMS:
Items which are lying in stores of any unit as surplus and
not required in the near future for such items, action for
reducing the surplus items is done. Every one can see the
Stock of particular material with consumption trend, date of
procurement etc. in SAP. The unit contact with others & if
the required material is surplus in other unit same is taken.
This is one of the best ways to reduce the surplus item
inventory .Even if any material is not surplus but lying in
some unit and required in other unit, than also the material
is taken on IUT basis, This not only reducing chances &
costs of stock outs but also increase inventory turn over
significantly.
Allen DG Spares is one the biggest example of this
transaction.
C) JUST IN TIME FOR LUBRICANT & LPG:
Most of the lubricants procured from M/s IOCL & M/s Bharat
Shell, both are having depots in Udaipur, as such we are
procuring as & when required and keeping nil inventories.
In the case of LPG also the cylinders are brought on
requirement basis.
D) USING BY PRODUCT OF ANOTHER UNIT:
Zinc Smelter, Debari using waste of other units e.g. Coke
fines in place of Coke Breeze from CLZS, required in Moore
Cake Plant. Annual consumption is around 15,000 MT per
annum. By using this waste a direct saving in material cost
is being done.
E) DISPOSAL OF SCRAP:
The wastage from manufacturing operation at various places
is sent by the user department to stores called scrap/
wastage. Stores receive the scrap regularly and stores in
scrap yard and these are sold on regular basis. Auctioneer is
appointed to carry out the auction activities by both open as
well as bid system. Roughly estimated value at the
beginning of the financial year disposal target is prepared
and time-to-time disposal action is taken. This sale of the
scrap reduces the net cost on material. The total realization
by scrap sales is as under
E) COMPUTERIZED INTEGRATED SYSTEM:
Regarding the integrated computerized system, after
implementation of SAP all materials related activities are
computerized and almost every hand is equipped with
computer and mailing system for fastest communication.
Everyone can see all the details of materials like the stock,
consumption trend; purchase price, source of supply,
delivery status etc. This helps in reduction in Lead Time and
Inventories significantly.
A Case Study
Zinc Smelter, Debari is a continuous process plant. Such
type of chemical plants has its own peculiarities and JIT is
difficult to achieve in many items. But still we can have some
items in JIT list like Lubricants, some class of bearings,
chemicals like hydrated lime, Lime stone Powder etc.
Presently after receipt of these materials, we take sample
and after laboratory test as per our order specification, given
to directly user, and we are not maintaining the stock of
these, item at stores.
Delivery schedule is given to supplier as per plant
requirements.
RECOMMANDATION
It is proposed to apply JIT to other chemicals and locally
available items also. Though it need regular follow up with
supplier, immediate quality testing and quantity verification
but the resultant of JIT is very impressive and bring down the
inventory levels.
For quality acceptance, the quality audit of vendor should be
done on regular interval to avoid possibilities of rejection.
We may insist the vendors to get quality certification like
ISO, ISI etc and use quality improvement tools like TQM, Six
Sigma etc.
7.4 A-B-C ANALYSIS
A Class Item: In this category, those items covered the
annual consumption of which is higher than
50,000/-
B Class Item: In this category, there item are covered the
Annual Consumption of which is below 50,000/- and
above 5,000/-.
C Class Item: In this category, those items are covered which
annual Consumption of which is below Rs. 5,000/-
At present Zinc Smelter, Debari the above limits are used for
A-B-C analysis. The above limit was fixed long back & plant
capacity was only 50,000 MT Zinc productions per annum, but
now the plant has already been expanded up to 88000 MT per
annum. The consumption is increased in comparison of last 5
– 7 years. Therefore we propose the following limits of
consumption pattern for A-B-C analysis.
A class items - In this category those items are covered for
where Annual consumption’s more than 2 lacs.
B class items-In this category those items are covered for
where annual Consumption’s more than
50,000 but not higher than 2 Lacs
C class items- In this category those items are covered for
where annual consumption is bellow Rs. 50,000.
The summary of ABC analysis is tabulated as follows:
ABC- No of Items
3% 5%
92%
A
B
C
ABC - Stock value
96%
2%
2%
A
B
C
Annual Consumption Limit Classif
y
No. of
Items
% Total Cons. Value(Crore
)
%Value
Above 2,00,000/-
Between 50,000/- to 2
Lac
Below 50,000/-
A
B
C
147
252
4657
2.91
5.00
92.1
1
9524.4
8
239.89
192.61
95.70
2.39
1.92
Total 5056 100
%
10056.
98
100%
A Class item
As per HZL norms, 147 items falls in this category. In this
situation, proper attention or inventory control not possible.
For proper control of inventory of A class item, A class item
consumption value should be higher and the number of
items in this category should be around 70 only.
Thus the main key area is to control of A class. If we give full
attention to these items through proper planning,
accounting, lead-time and regular follow up, we can fulfil the
requirement of user by keeping at optimum level & we can
increase company profit.
(A) Review of some A class Item
A.1 Ammonium Sulphate
Average monthly requirement is 300 MT. The lead time is app
10 Days.
The Stock position is as under
Stock Details Qty.(In MT.) Value ( In
lacks)
Opening stock
(1/4/08)
102.30 9.80
Receipt during the
year
3460 238.95
Issue during the year 3464.55 239.66
Balance as on 97.80 8.37
31.03.2009
On analysing the above data, it can be observed that monthly
consumption is 300 MT app and the closing stock is 97.80MT
which is just 10 Days Stock. Looking to the criticality of item
the stock is just sufficient.
RECOMMANDATION
The lead time is 10 Days and the stock is also just 10 Days
shows the control on inventory. However looking to the plant
requirement & long transportation lead time, the stock should
be monitored regularly.
A.2 Caustic Soda Flakes
Caustic soda flakes is used in DM water plant, which is very
critical for process. The monthly requirement is app 60 MT.
The lead time is around 10 Days. The required quality
material is available with few suppliers, that to on advance
payment.
The stock position of caustic soda flakes as under: -
Stock Details Qty.(In MT) Value ( In
Lacs)
Opening stock (1/4/08) 29 4.45
Receipt during the
year
680 110.35
Issue during the year 667.68 108.12
Balance as on
31.03.2009
41.32 8.41
RECOMMANDATION
We should develop more suppliers who can supply the
required quality material with favorable payment terms. Also
this reduces lead time & in turn inventory can be reduced.
Still the inventory is high but it is less than one month’s
consumption.
Effective control on stock is required.
7.5 XYZ Analysis
The XYZ analysis is based on the value of inventory stored.
XYZ is the value of inventory available as a basis on a
particular date. The exercise is done once a year during the
annual stock taking exercise. This analysis helps to control
obsolescence and tells how to distinguish amongst material in
stores.
X Items are those value is highest and Z items are those,
which are low value items. Y items fall in between two
categories. This classification helps
In XYZ analysis the method of control is as follows: -
Sl.No.
X Class Item Y Class Item Z class Item
1. A Critical analysis must done in an effort to reduce stock.
Attempt must be madeto convert to Z category
Items are withinControl.
2. Consumption and stock Should be reviewed Frequently.
Further action in controlmay not be necessary
Can be reviewed Twice in year.
3. Steps should be taken to dispose off surplus stock.
Control should be Tightened.
Can be reviewed Annually.
The stock position at the end of financial year 08-09 as per
criteria of XYZ Analysis is tabulated as follows:
Closing Balance Limit
Category
No. of
Items
% Total Stock Value
%Value
Above 1,00,000/- X
Y68 1.34 418.7
574.40
Between 15,000/- to 1 Lacs
Below 15,000/-
Z264
4724
5.22
93.43
93.07
51.05
16.53
9.07
Tota
l
5056 100.
00
562.8
7
100.0
X CLASS ITEMS
In this category, those items are covered whose closing
balance of stock is higher than Rs. 1.00 lack. After
investigation only 68 items valuing Rs. 418.75 Laces such
items out of 5056 are covered in the limit whose financial
value is 74.4 % of total inventory stored. If we succeed in
controlling the inventory of this category the overall
inventory is controlled and we can easily reduce the
inventory to an optimum level.
A. Study of Some X Class Items
A.1 LSHS This is the item having highest consumption as
well stock value. This also critical for DG operation.
Stock Details Qty. (In
Mts.)
Value (In
Lacs)
Opening Stock ( 01.04.08) 1096.36 129.12
Receipt 48648.38 5771.14
Issue 48484.20 5742.69
Closing Balance
( 31.03.09 )
1260.54 146.01
On analysing the above data, it is observed that daily
consumption is around 140 MT but the stock is for 8 days. The
average stock value is more than one crore.
RECOMMANDATION
The requirement of LSHS is regular as well very high. It is
proposed to explore the possibility of establishing “Consumer
operated Depot” so that the carrying cost shall be avoided.
This also helps in reducing inventory drastically, as the
consumption value is as high as 56% of total consumption.
A.2 Cathode Aluminium Sheets
This is one of the most critical and high consumption as well
high value item. This is also monitored through Critical Item
statement. The lead time is more than a month.
Stock Details Qty. (IN
MT.)
Value (Rs
Laces)
Opening Balance (1/4/08) 18.642 21.97
Receipt during the year 140.279 166.12
Issue during the year 146.21 172.68
Closing Balance as on
31.03.2009
12.711 15.24
The above data shows the stock is for more than one month.
More attention is needed.
RECOMMANDATION
The delivery schedule should be monitored more closely to
keep minimum inventory.
APPENDIX&
BIBILOGRAPHY
BIBLIOGRAPHY
A. REPORTS AND BOOKS
- Annual Reports of Hindustan Zinc Limited.
- Material Management – An Integrated Approach By
Gopalkrishnan and Sunderasan M., 1997, Prentice-Hall of
India, New Delhi.
-Production and Inventory Management by Hax A.C.,
and Candea D., 1984, Prentice-Hall,: Englewood-Cliffs.
- Purchasing and Materials Management - Text and
Cases By Lee L., and Dobler D.W., 1997, Tata McGraw
Hill: New Delhi.
- Material Management by Sharma P.C., 1980.
Kitab Mahal: Allahabad.
- Essentials of Store Keeping and Purchasing
By Verma M.M., 1975, Sultan Chand and Sons, New Delhi.
B. INTERNET SITES-
http://en.wikipedia.org
www.researchandmarkets.com
http://www.inventorymanagement.com/
http://www.globalspec.com/
www.indianmba.com
www.answers.com
traininganddevelopment.naukrihub.com
www.hr-guide.com
www.eecs.harvard.edu
www. mining topnews.com
www.epa.gov
www.askmehelpdesk.com
www.investopedia.com
http://www.worldnonferrous.com
www.dominetrue metal .com
www.indian metal s.com
http://www.infomine.com
www.hzlindia.com
http://mines.gov.in
http://minerals.er.usgs.gov
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