cryptyms project
TRANSCRIPT
An REPORT ON ORGANIZATION STUDY ATCRYPTMS, THODUPUZA
Sub. Code No. CC338
A project Report Submitted to the Mahatma Gandhi University
In partial fulfillment of the Requirements for the award Of the Degree of Master of Business Administration
ByTREESA PUNNOOSE
REG NO: 90658
Under the Guidance ofMr. DAWN JOSE ROY MATHEW
School of ManagementST. JOSEPH’S COLLEGE OF ENGINEERING AND
TECHNOLOGY, CHOONDACHERRY, PALA
1
2009-2010
School of ManagementST. JOSEPH”S COLLEGE OF ENGINEERING AND
TECHNOLOGY
Certificate
Certified that, this is a bonafide report on the organization study conducted by Ms. Treesa Punnoose, II Semester MBA student of St. Joseph’s College of Engineering & Technology, at ‘Cryptms Confectionaries’ Thodupuzha. This has been conducted under the Guidance of Mr. Dawn Jose Faculty, and School of Management and submitted to Mahatma Gandhi University, Kottayam in partial fulfillment of the requirements for the award of Masters Degree in Business Administration.
Project Guide Head School of Management
Viva-voce held on: …………………………………………
Panel Members Name Signature1. _______________________ ______________2. _______________________ ______________
2
DeclarationI hereby declare that the project entitled
“ORGANISATION STUDY” is a record of bonafide
research carried out me under the supervision of Mr.
DAWN JOSE ST. JOSEPH’S COLLEGE OF ENGINEERING &
TECHNOLOGY.
Pala TREESA PUNNOOSE
3
Acknowledgement
First of all I immensely and whole heartily thank
god for giving me an opportunity for successful
completion of my project.
With great pleasure, I sincerely thank a number of
people who have provided understanding and
assistance in this effort. The speedy and neatly
completion of the study achieved due to the sincere co-
operation and help of Mr. Roy Mathew, Finance
Manager CRYPTMS group of companies. So I
acknowledge with sincere thanks for his active co-
operation and helps rendered.
I am also thankful to the staff of CRYPTMS group of
companies who helped me to complete the project
successfully.
I am extremely thankful to all the faculty members
in the school of management for their valuable
guidance and encouragement
4
Finally, with deep feelings of indebt ness, I express
my warm thanks to my parents, friends and well-
wishers who have directly and indirectly contributed a
lot towards this project.
Pala TREESA
PUNNOOSE
CONTENTS
CHAPTER HEADINGS
CHAPTER I
CHAPTER II
CHAPTER III
General Introduction
Objectives of study
Study Plan
Data Process
Limitation
Chapter Scheme
World Scenario
State Scenario
Indian Scenario
Company Profile
Objectives of the company
Organization Structure
5
CHAPTER IV
CHAPTER V
CHAPTER VI
CHAPTER VII
Future Plan
Departments
Functions & Responsibilities
Structure of each Department
SWOT analysis
Observations & Suggestions
Conclusion
Bibliography
List of Charts and Structures
Structures
Organization Structure
Organizational chart Project Division
Structure of Production Department
Structure of Purchase Department
Structure of Accounts Department
Structure of Marketing Department
6
Structure of Finance Department
CHAPTER I
7
Introduction
Everybody irrespective of their age likes sweets. Confectioneries are very
much popular among the people. The confectionary industry is a very
competitive one. Various new companies came into this field.
Kerala is a state with many large medium scale industries. Confectionary
industry is one of the leading industries, which occupy whole of the state.
Confectionaries have a better demand all over the world. About 22 confectionary
companies are working in Kerala; they all sell about 75 varieties of chocolates
all over Kerala and in India.
In recent years, many new companies come into field. The leading
confectionary companies in Kerala are CRYPTMS, Foster, craze, Cukoo, Royal,
Ruby, Pritis, Priya, Toffo, Sakthi, and Derby etc. Every Company in Kerala is
8
facing stiff competition, mostly from Parrys, Nutrine, Nestlle, Carbury etc. Each
company is producing at least 15 varieties of candies and toffees etc.
History of Chocolates
As with most good things in life, the study of chocolates gives back to the
beginning of the civilization. It comes from the beans of cocoa tree that grows
wild across much of Central and South America. The scientific names of the tree
(Theobrom) literally mean “Food of Good”. Chocolates reputation as an item of
luxury contained well into the 18century when as French Commenter wrote, “the
great tasks it sometimes, the old often the people never”. Perhaps it wasn’t so
surprising, even in 1971 the retail value of one pound of vanilla chocolate was
roughly equivalent to the average weekly wage of a farm labourer.
Although the fame of chocolates continued to spread it was still
consumed only in liquid from as drinking chocolate or cocoa. It was not until the
early 19 century, that Conrad Van Houghton; a Dutch Chemist developed a
process to remove some of the fat and paved the way for the production of the
first edible bars of chocolates. In 1976, Daniel Peter of Switzerland had the idea
of adding the dried milk to produce the milk chocolate and the modern chocolate
industry was born.
The confectionery industry was started in India quite casually in some
sugar mills just extra arrangement confectionary items. It also has the capacity as
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an energizer like sugar or glucose; moreover it has a very good demand and then
new production units started. Since then confectionery industry was dancing to
the tone of availability of sugar, but it was in a gradual rise till 1965.
The decade 1965 to 1975 is marked as “ dark decade” in the confectionary
industry as the production down from 24,000 tones in 1968 to a mere 9,000
tones in 1973. This was due to sudden imposition of excise duty, but during later
years, it was relaxed and in 1980, with reservation of confectionery in the
exclusive sector of small scale the number of mechanized units went up from 24
in 1979 to 40 in 1988. Then it has bright future and lot of improvements and
innovations came to this line in the next decade. Today the industry is producing
about 75000 tones in the organized sector
Methodology of the study
It is the way to systematically solve the problem. In it one can
found various steps that are generally adopted by a researcher in studying this
research problem along with the logic behind them. It is necessary for the
researcher to design the methodology for the problem. Exploratory research has
used to collect the data relating to the topic under the study.
Personal observation, interview with key personnel of each
departments and information drawn from company manual and journals
10
facilitated the collection of required data. Collection of data includes both
primary and secondary data.
Primary data is a data collected by the investigator himself for the
purpose of a specific inquiry or study. The data was collected through
observation and using data collection instrument questionnaire and pilot study
was conducted in order to edit or eliminate error. Secondary data was collected
from the internal records of the company, library references and Internet
Sources of data
Primary and secondary sources were used to collect the information
required for study. Primary data are collected by making direct interview with
the authorities, officials, and workers and by observation.
Secondary data are collected from information regarding the company, its
history and profile from company manuals, journals and websites and from other
company records.
Objectives of studyPrimary objective
To study the organizational structure and departments of the Company
Secondary objective
11
To get a real life exposure to human resources management, marketing
techniques and financial management, knowledge, this gained through
management studies.
To get awareness about the overall performance of the company
To assess the efficiency of different Department
To check out whether there is a need for introducing corrective measures in
any of the company strategies.
To make study about organization including all departments
To ascertain the organization structure
To ascertain the process of each Department and structure of each
Department
To Know the duties and responsibilities of Key personnel
To Know department Future plan
To know the function of each department
To give suggestions to the company for improvement
Getting practical experience regarding the organizational function
To Improve Management skill
Limitation of the study
12
No scientific tool is administrated for any of the evaluation
Deficiency of time and business of key personals act as stamping in the path for proper
data collection
ABOUT COMPANY
Name & address:
Registered office:
Established:
Area of company’s network:
Subsidiaries:
CRYPTMS Confectionaries (India) Pvt. Ltd
Post box.10 kanjiramattom road
Thodupuzha, pin; 685 583
Kerala
Thodupuzha
1986
Kerala, Tamilnadu and Andhra Pradesh
Bristo food India (Pvt) ltd
Megha home products (Pvt) Ltd
Unipack India (Pvt) Ltd
13
No. Of Wholesalers:
No. Of Workers:
No. Of Products:
Target Growth of sales:
Comfort cartons India (Pvt.) Ltd
Efficient marketing India (Pvt.) Ltd
200
500
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15%
CHAPTER II
14
INDIAN SCENARIO OF CONFECTIONERY
Confectionery in India industry profile is an essential resource for top-
level data and analysis covering the confectionery industry. It includes detailed
data on market size and segmentation, plus textual analysis of the key trends
and competitive landscape, demographic information, and descriptions of the
leading companies.
Scope
* Contains an executive summary and data on value, volume and segmentation
* Provides textual analysis of the industry's prospects, competitive landscape
and Leading companies
* Includes a five-year forecast of the industry
15
* Supported by the key macroeconomic and demographic data affecting the
market
CADBURY INDIA TODAY
Index stock on BSE and NSE.
Rs. 15 billion market capitalization.
48,000 + shareholders.
1,900 + employees
Rs. 5,711 million sales in 2000:
1. 76% Confectionery
2. 24% Food Drinks.
Rs. 1,069 million PBDIT
Rs. 2,345 million total assets.
OUR PLACE IN CADBURY SCHWEPPES GROUP
1.8% of group sales
1.2% of group net assets.
1.8% of group PBIT (Profit before interest and tax)
Part of 'developing markets' region
Full support from group.
16
Branded Impulse Market includes Chocolates, Biscuits, Ice Creams,
Salted Snacks, and Soft Drinks
There are over 1.5 million retail outlets for FMCG in India. Over two-
third of this stock branded impulse products, but fewer than 25% sell
chocolate.
Branded Impulse Market
Current chocolate value share of total impulse category is 6.1% (CIL
4.4%). Though this is relatively small, changing tastes and lifestyles of
consumer offer tremendous scope for growth.
Chocolate confectionery is sold at premium in India compared to other
branded impulse products.
Consumer - Growth Opportunities
Impulse snacking is an Indian habit.
Attitude and disposable income changes are favourable to impulse foods.
Large youth population, 47% of urban India is growing dominant
chocolate consuming segment.
Child and gifting segments expected to grow at faster rate.
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Current low penetration of Chocolates, 22% adults in urban India.
Creating Value in Future
Effectively managing growth drivers
1. Gifting Child Connectivity and low end VFM.
2. New channels.
Optimizing manufacturing efficiencies.
Aiming for best in class TMC in Cadbury Schweppes plc. (CS) for CDM
and Éclairs.
Competitiveness in logistics and distribution using IT.
Exploiting mass media to create / maintain large brands.
10+% Advertising / Sales
Chocolate Imports
Greater presence of imported products
Low volume high trade margin segment
Reducing restrictions and duties
Threat as well as opportunity.
CS International portfolio being evaluated.
18
Impact of WTO - Lifting of QRs
Window of opportunity for importing from CS group companies.
1. Better cost effectiveness for trying new products
2. Possibility of providing huge variety
3. Good speed of response to consumer likings
4. Large opportunity in Sugar Confectionery category
Our Vision
Cadbury in every pocket
Superior shareholder value.
This Requires
Broadening our consumer appeal and extending our reach to newer
markets.
Sustained growth of our market share through aggressive product
development.
Striving for international quality in our products and processes.
Focusing on cost competitiveness, productivity and innovative utilization
of assets. Energizing and developing our people.
19
GLOBAL SCENARIO OF CONFECTIONERY
Confectionery in the United States
Confectionery in the United States industry profile is an essential
resource for top-level data and analysis covering the confectionery industry. It
includes detailed data on market size and segmentation, plus textual analysis of
the key trends and competitive landscape, demographic information, and
descriptions of the leading companies.
Confectionery in Austria to 2010
Introduction
Confectionery in Austria to 2010 is a detailed information resource
covering all the key data points. It includes comprehensive value volume
20
segmentation and market share data. The data book supplies actual data to 2005
and full forecasts to 2010.
Scope of this report
Contains information on 4 categories: Chocolate, Gum, Sugar
confectionery, Cereal bars.
Provides market value, volume, and expenditure and consumption data by
market, segment and sub segment.
Includes company and brand share data by category, as well as
distribution channel data.
Contains market value segmentation by demographic and socioeconomic group
Key reasons to read Confectionery in Austria to 2010:
Discover the major quantitative trends affecting the Confectionery
markets.
Understand consumers' consumption and expenditure patterns.
21
Understand the future direction of the market
22
CHAPTER III
Company ProfileCryptms Confectionaries (India) Pvt. Ltd. was incorporated in the year
1987 at Thodupuzha, in the Idukki District of Kerala. The company’s marketing
office is at Cochin. The first year itself the company achieved a turnover of Rs.
One crore with the financial help of Kerala Finance Corporation (KFC), Canara
Bank etc. This was achieved with the dedicated services of experienced
employees of the organization. Well-organized distributors also played an
important role in brining the company to such a height.
They found that there is a scope on the biscuit market. So they had started
a new biscuit unit named ‘MEGHA HOME PRODUCTS PRIVATE LTD’. They
manufactured in the brand name ‘CRYPSY BISCUITS’. This is a registered
small scale industrial unit with authorized capital of Rs. 10 lakhs.
23
Now the company extends its coverage all over south India with hundreds
of distribution and by using effective sales operations. The company’s major
strength is its distribution channels. Companies field representative accompany
the distributors for taking orders and to understand the taste preference and
opinion of dealers and consumers and the market situation.
The company has more than 50 distributors in Kerala. The Keralamarket is
divided into 4 regions and each region having different supervisors, one
marketing manage department for. The marketing manager co-ordinates various
activities of its maximizing the turnover of the company. Competition is
increasing day by day and introduction of new products in every year is a must
for exist the market. Apart from new products, sufficient advertising and
supporting schemes are necessary
Cryptms made large-scale advertising through TV and Radio to increase
the awareness of the products among consumers. Nutrine and parry are the major
competitors of Cryptms. Cryptms possess the third position in the confectionery
industry in India.
The employee of the organization is divided into four categories, workers
both temporary and permanent, office and administrative staff, marketing staff
and security staff. The organization gives importance to the welfare of the staff
and workers because development of the organization can be attained through the
development of its employees.
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The representative of the workers are also includes promotion of the
employees in the managerial decision is based on the performance appraisal and
seniority. For expanding the business operations of the company, Cryptms started
a new plant at Palakkad, which named as ‘BRISTO’; this new unit is having the
production capacity three times than that of the old plant. Cryptms-Confectioners
through its associate company, megha home products is now entering into biscuit
market by name; CRYPSY’ biscuits in four varieties such as glucose, milke,
Arrowroot and Marie. The other leading suppliers in the biscuit market are
Britania, Craze, Priya, Boon Ambro and Nutrine.
Objectives of the company
The objectives of the company includes following:
Quality
Profit maximization
Cost minimization
More employment
Time delivery
Consistency in sales and services
25
Values of a company
High quality products
Customer Orientation
Team work among employees
Profits for invention and innovation
Future Plan of Cryptms
Cryptms is trying for future expansion and diversification. It has entered
into export arrangement with Messer. Omni Exports, USA and Sigma
International Inc introducing more Products into the market. Every year
company is aiming an annual growth of 15%.
HISTORY & PHILOSOPHY
The activity of Cryptms has been diversified with establishment of
following units:
A. Bristo Food (Pvt.) Ltd
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The growing demand of the product in the market inspired the promoters
to go for a new unit. Bristo Food (Pvt.) Ltd was started in the year 1995. This
unit produces the Cryptms confectionery products. This unit’s annual
production capacity is 3500 tons of sweets.
B. Megha Homes India (Pvt.). Ltd
Crypsy biscuits were introduced as a part of diversification programme of
Cryptms. The company’s subsidiary, Megha home products Pvt. Ltd produce
the Crypsy biscuits. This was formed in 1993; the existing network of Cryptms
is used for marketing crypsy biscuits.
C. Unipack India (Pvt.) Ltd
The company established Unipack India (Pvt.) Ltd in the year 1989 to
produce the packing materials for cryptms. The company is able to undertake
production of the same for outside companies in the future. The company needs
further expansion. This unit is located in Alapuzha District.
D. Comfort Cartons India (Pvt.) Ltd
Comfort Cartons India (Pvt.) Ltd was established to produce the
packing materials for the company. This unit is capable of producing quality
packing cartons and allied materials.
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E. Efficient Marketing (Pvt.) ltd
This was established in the year 1993 as an independent and
professionally managed marketing organization. This unit having its head office
at Cochin. The marketing activities of the products of Cryptms Group are
carried on by these units
SHARED VALUE
Guiding concepts, fundamental ideas around which a business is builds
must be simple, usually stated at abstract level have great meaning inside the
organization even through outsiders may not see or understand them.
The shared value of ‘CRYPTOMS’ confectionaries as follows:
Vision statement
“Quality products through continues improvement”
Mission Statement
“Spreading quality sweets through out the world”
Social Activities
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The company is doing a number of social activities. The company had
given much remarkable contribution to the society. The company usually
sponsors many charitable works organized by different people from society as
well as by the charitable organization. The company had sponsored award at
taluk Hospital, waiting Sheds at Thodupuzha Private Stands and other Places.
The activities have gained much appreciation from the society.
Awards
Cryptms confectionery got FACT MKK Nair Memorial Productivity
Award 1999-2000 for being second in the category of small scale industries
Product ProfileThe production unit of Cryptms in Thodupuzha at present produces 60
tons of sweets in per month. The maximum production capacity is 110 tons per
month. Now they are producing 15 major varieties of sweets, out of which 5
items are candies and 10 items of toffees. Éclairs come under the category
toffees. The price varies from 25 paisa to 1 rupee. Each candy weights 5 grams.
The products are packed in ½ KG packets.
PRODUCT DETAILS
Superlacto Candy with the taste of milk and butter
Coffee cube Toffee with the taste of coffee
Caramel Toffee with the taste of milks
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Coconut Cookey Candy with the taste of coconut milk
Éclairs Toffee, Chocolates with cocoa flavour added in its center
Orange Excel Candy with the taste of orange
Happy Birthday Toffee with the taste of vanilla
Mango Treat Candy with the taste of mango
Paradamen Toffee with the taste of honey and milk
Love Toffee with the taste of honey and milk
Coconut toffee Toffee with the taste of milk and coconut
White Éclairs Toffee with a milk solid at its center covered by Chocolate
Limca Candy with the taste of lemon
Pine Rich Candy with the taste of pineapple
ORGANIZATION STRUCTURE
30
BOARD OF DIRECTOTS
EXECUTIVE DIRECTORS
MANAGING DIRECTOR
PRODUCTIONMANAGER
FINANCEMANAGER
PERSONALMANAGER
R & DMANAGER
MARKETING
MANAGERSUPERVISOR FINANCIAL
OFFICERPERSONALSTAFF
R & DDEPARTMENT
PURCHASEMNAGER
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WORKERS ACCOUNT STAFF
NORTH AREA
SALES OFFICERRS
SUPERVISION
REPRESENTATIVES
CENTRAL AREA
SALES OFFICERS
SUPERVISION
REPRESENTATIVES
SOUTH AREA
SALES OFFICERS
SPERVISION
REPRESENTATIVES
CHAPTER IV
DEPARTMENTS
PURCHASE DEPARTMENT
PRODUCTION DEPARTMENT
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MARKETING DEPARTMENT
FINANCE DEPARTMENT
PERSONAL DEPARTMENT
PURCHAE DEPARTMENT
The purchase department plays a very important role in an organization
because purchasing has its effect on every vital factor concerning the
manufacture, quality, cost, efficiency and prompt delivery of goods to
customers. Its function is to procure materials, supplies, services, machines and
tools at the most favorable terms consistent with maintaining the desired
standard quality. Purchasing is the most important function of materials
33
management as the moment an order is placed for the purchase of materials; a
substantial part of the company’s finance is committed which affect cash flow
position of the company. The purchase system is centralized in Cryptms.
Centralized Purchase department means that all the purchase functions
are routed through one department. This means all purchases should be made by
the purchase department to avoid duplication, overlapping and non-uniform
procurements.
Purchasing is the most important function of materials management as the
moment an order is placed for the purchase of materials, a substantial part of the
company’s finance is committed which affect cash flow position of the
company.
Objectives of purchase department
o To make continuous availability of materials so that there may be
uninterrupted flow of materials for production
o To make purchase competitively and wisely at the most
economical prices
o To make purchases in reasonable quantities to keep investment in
materials at minimum
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o To purchase proper quality of materials to have minimum possible
wastage of material & loss in production
o To develop good supplier relationship which will ensure the best
terms of supply of materials
Functions of Purchase Department
1. What to Purchase?
2. When to Purchase?
3. Where to Purchase?
4. How much to purchase?
5. At what price to Purchase?
To perform these functions effectively, purchase department follows the following
procedure:
a. Receive the purchase Requisitions
b. Exploring the sources of supply and choosing the supplier
c. Preparation and execution of purchase order
d. Receiving and inspecting Material
e. Checking and passing of bills for payment
35
Procedure of placing purchase order
The company invites quotation received from different suppliers. Based
on these an appropriate supplier is selected and places orders with them. To
ensure the quality of the product, the company checks the quality of the
product.
To receive goods are kept in the stores. The supervisor in charge of
production is the person to supply the materials on the basis of demand from the
production department
Structure of purchase department
36
Managing Director
Executive Director
Purchase Manager
Board of directors
PRODUCTION DEPARTMENT
PROCUREMENT OF RAW MATERIAL
PROCEDURE OF PLACING THE PURCHASING ORDER
PRODUCTION PROCESS
PRODUCTION PROCESS FLOW CHART
37
Purchase AssistanceStorekeepers
Helpers
PRODUCTION DEPARTMENT
The production process of Cryptms is carried out in its plant situated at
Thodupuzha. The main raw materials used for production are liquid glucose and sugar.
The other ingredients used in the production are milk products, vegetable fat, coconut
powder, Chocolate cocoa paste, flavors etc. Different ingredients are used according to
the nature and type of toffee and candies.
Procurement of raw materials
Procurement of raw materials is one of the responsibilities of production
department. With the help of a bin card the daily stock of raw materials are assesses
and recorded. A minimum quantity of stock is determined for each of the ingredients.
Once the reorder level is reached, purchase order is placed.
Items Main Sources
38
Sugar Tamilnadu
Glucose Tamilnadu & Kerala
Cocoa Karnataka
Butter Kerala
Inner foils Tamilnadu
Production Process
The products can be mainly classified as candies, toffees and éclairs.
Candies are hard sweets toffees are used in these different products.
Production process for the three items is same except the natural curing
process for the toffee and éclairs.
Process
Different ingredients are mixed according to the formula. This mixture is
fed into vacuum batch cooker. They cook the mixture and add other ingredients
like flavors, colour, preservation etc. Water removed using the dehumidator and
the mass is pulled into the cooling table.
The cooled mass is fed into the batch roller which consists of three
cylindrical rods tapering towards one end and rotates in both directions. The
batch roller makes the cooled mass into a cope like from and is passed through
size where the cope is shaped into required size. It is then passed through
forming machine or cutting machine where the candies or toffees are cut into
39
desired shape. After cutting, it is passed through the conveyor belt which is
equipped with drying blower, where air is blown to make the candies separated
each other. Then it is ready for packing.
The Candy items are packed readily. Toffees are packed only after
natural curing. Curing machine and wrapping machine are used for this. The
products are packed in ½ kg or 1 kg packets. They are stored safely at the
godown.
Production Flow Chart
40
Receipt & storage ofRaw materials
Vacuum Batch Cooker
Cooling Table
Batch Roller
Size or performer
Forming & cutting
STRUCTURE OF PRODUCTION DEPARTMENT
41
Separator
Wrapping Machine
Curing Machine
Warehousing
Board of directors
Managing Director
Executive Director
Production Manager
RESPONSABILITIES OF KEY PERSONALS
RESPONSABILITIES OF PRODUCTION
MANAGER
o Prepare weekly wage list and ensure disbursement of weekly wage by
the cashier
o Ensure that an approved list of schedule of wages is available as and
when changes Takes place
o Prepare a monthly salary statement and hand over to the account
department.
42
Supervisors Plant Operators Mechanics
Workers
Helpers
o Maintain the attendance register for production staff
o Ensure leave sanction of all employees and one copy of leave
application is forwarded to HR department
o Ensure that the effluent treatment plant log book is properly maintained
by operators
o Ensure that the pollution control norms are properly informed
Responsibilities of supervisor
Ensure all out sourced products are checked, packed, stocked correctly
Ensure that all out sourced items are received at the respective godown
Inform export department regarding the position of the order well in advance
Oversees duties of packing and dispatch supervisors
FUNCTIONS OF PRODUCTION DEPARTMENT
Production Department is important for an industry. Many manufacturing
organizations are divided up on functional lines. Clearly the most important
department in a manufacturing company is often the production department.
The production department coordinates the production and manufacturing of
each title.
Production department is deals with the process of producing Product.
That means converting input into output. A material is a very important factor
43
of production. It includes physical commodities used to manufacture the final
end product. Production is manufacturing. Manufacturing is understood to
refer to the process of producing tangible goods whereas production includes
creation of both tangible as well as intangible service.
o Establish points of inspection and test at a selected points in the
production processes
o Assure that purchased materials conforms to the requirement of
purchase confirms to the requirements of purchase orders and
specification
o Perform inspection and tests at selected points in the production process
o Collect and analysis inspection and tests data and provide information on
process and product quality levels
Machinery
The selection of machinery is important since better utilization of
machines gives higher return for the money spent. The plant is equipped with
modern machineries and operations are organized under efficient supervisors.
44
Storage
Production department has separate stores for raw materials and finished
goods. Raw materials are gathered with the help of contractors and is stored out
side the company premises. They always take steps to ensure that the raw
materials are never out of stock. Once in a week stock verification is conducted.
PERSONAL DEPARTMENT
PERSONAL STRUCTURE
45
WAGE-SALARY ADMINISTRATION
MANAGEMENT-WORKERS RELATIONSHIP
PERSONAL DEPARTMENT
The development of the organization can be achieved through the
development of the people of the organization. So we can say that workers are
the back bones of the organization. The impressive level of productivity is a
hallmark of cryptms and today the company have highly committed and
disciplined workforce which leads a high degree of productivity with
impressive levels of quality.
46
The company gives importance for employee welfare and individual
development of them. The organization promotes the concept of participative
management, especially in quality circle, employee suggestion schemes etc.
Personnel structure
The employee of the organization can be classified as Managerial,
technical, factory, workers, office, administrative staff and security staff . The
workers are again classified into skilled, semi-skilled and unskilled workers.
All Sundays are holiday for the employees. There are thirteen holidays
except the Sunday in a year. The workers shall to be sick leave, casual leave,
privilege leave and earned leave. The marketing staff consists of marketing
manager at the top followed by area manager, sales officers and representatives.
This sales force provides information on current market condition more
accurately
The company provides training facilities to employees. They provide on
the job training to the workers for the period of one year with stipend and are
promoted as probationary workers for the period of two years, after the
completion of this period, on the basis of supervisors report. Able employees
are appointed as permanent workers.
Wages-Salary Administration
47
Salary of the office staff consist of basic pay and HRA. For marketing
staff, a certain percentage of the sales turnover is given as commission. The
workers are paid according to scale. It consists of basic pay, fixed DA and
variable DA. They also provide provident fund, contribution towards pension
fund, bonus and gratuity. The workers are also providing with ESI benefits.
The employees are promoted on the basis of performance appraisal and
seniority. The company provides health, welfare and safety measures to the
employees. Uniform is given every year to the workers. The companies also run
a canteen for the employees where subsided food is subsided food is supplied
during the working hours.
Management- Workers Relationship
The management having a view that the success of the company depends
very much on the healthy relationship between the management and staff, the
secret of the success of any depends upon that. The management
encouragement encourages employee participation in the overall activities of
the company. The company conducts competition for the employees in sports
and games field.
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The workers come under trade union namely CITU and BMS. 70% of the
workers are under CITU and others, 30% under BMS. The management having
good relationship with these unions and so far there is no strikes or problems.
The management goes hand with the workers and trade unions.
FUNCTIONS OF PERSONNEL DEPARTMENT
Promotion & Transfer
Remuneration
Performance appraisal
Financial & Non-financial incentives
Keep pace with New Development
Optimum utilization of Manpower
Ensuring Job Satisfaction
Placement of manpower
STRUCTURE OF PERSONAL DEPARTMENT
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Board of directors
Managing Director
Executive Director
MARKETING DEPARTMENT
MARKETING ADMINISTRATIONMARKETING SEGMENTATION
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HR manager
Personal Staff
TechnicalStaff
Managerial Staff
FactoryWorkers
Office & administrative
SkilledWorkers
Semi skilledWorkers
UnskilledWorkers
PRICINGDISTRIBUTION CHANNELADVERTISEMENTCOMPRTORSMARKET OUTSIDE KERALASALES OF VARIOUS PRODUCT
MARKETING DEPARTMENT
Marketing is the most complex and challenging function to be preformed
by every business firm. It is the process of finding and fulfilling consumer
desires in such a way that to achieve profit to the organization and to satisfy the
customers.
Marketing is the analysis, planning, implementation and control of
programmes designed to bring desired exchange with target audiences, for the
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purpose of personal and mutual gains. It relies heavily on the adaptation and co-
ordination of product, price, promotion and place for achieving response.
Market segmentation
Once the market has been identified, it becomes easy for an organization
to make a product satisfies customers and differ from those of competitors. The
market segmentation is the strategy that subdivides the largest market in to
subgroups of consumers with definable, distinct and differentiated marketing
programmes for each subgroup in order to enhance satisfaction to consumers and
profit to the marketer.
The market for toffee and candies are segmented according to age and
behavioral patterns, usually kids and teenagers are the potential consumers of
these products. Marketing concentrates on this group. Any products at its
introduction stage bring only a low profit due to the expenses in sales promotion.
Similarly to capture the market a lot of changes can be done to the existing
product, like changes in shape cover, change in colour etc.
Pricing
The slightest variation in the price affects the sale in candies or toffees
due to the cut throat competition in the market. Thus the pricing depends upon
many factors such as:
i. Competitors price
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ii. Cost of production
iii. Buying pattern of the consumers
iv. Distribution channel
Some products of the company gets a high profit while others get a less
amount of profit only. Even then for the existence in the market and to push up
the sales of other products, the company continues to sell those products also in
the market.
Distribution
Cryptms has more than 50 distributors all over Kerala. For proper
distribution the entire market is divided into different zones under district
supervisors.
Distribution Chart
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Warehouse
Factory
Cryptms Advertisement
Advertising is the process through which the consumers are getting
information about the product. IT persuades the consumers to buy the product.
It increases the sales and helps in creating a brand name and consumer loyalty.
Advertisement may be
i. Informative or competitive
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Distributor
Wholesaler
Consumer
Retailer
ii. Product oriented ocompany oriented
While informative advertisement given information about the product,
competitive advertisement tries to put down the competitors products.
Similarly, the product alone, where as the company oriented advertisement
focuses on the whole products of the company or the company as a whole.
Cryptms spent a large amount on advertisement. The advertisement
efforts can be channeli zed as follows:
Wall painting
Boarding and boards
TV\Radio\Newspaper
Side panels on KSRTC Buses
Competitors of cryptms
Competitors are increasing day by day. In the confectionery market parry
enjoys the first position followed by Nutrine and then Cryptms. Parry captures
the majority of the market share. They sell large volume of product at a low
cost. Both parry and Nutrine spends large amount on advertisement.
In Kerala market, Cryptms enjoy the first position. Other competitors
include Triffani, Ruby, Craze, Foster etc.
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Markets outside Kerala
The company does not enter directly into the market outside Kerala. All
the dealings outside the state are done through carrying and forwarding agents.
Interpretation
It is observed that out of total sales volume of Cryptms, 18% HAPPY
BIRTHDAY are sold more by the retailers and then comes 16% LOVE and
15% Éclairs, 13% PRADAMAN, 11%COFFEE CUBES, 7% CARAMEL, 6%
ORANGE TREAT, 5%SUPER LACTO, and 3% Coconut cookie. HAPPY
BITHDAY, LVE AND ECLAIRS are selling in larger proportion. Super lacto
and coconut cookie are being selling very less proportion.
VARIETIES SALES VOLUME(1KG.PKTS) IN PERCENT
Super lacto 35 5
Coconut cookies 20 3
Orange Excel 40 6
Coffee Cube 73 11
Caramel 52 7
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Éclairs 110 15
Happy Birthday 125 15
Mango Treat 40 6
Pradaman 90 13
Love 115 16
Total 700 100
SALES OF VARIOUS PRODUCTS
Structure of Marketing Department
57
Board of directors
Managing Director
Executive Director
FINANCE DEPARTMENT
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Marketing Manager
North area
Sales officers
Supervision
Representatives
Central area
Sales officers
Supervision
Representatives
South area
Sales officers
Supervision
Representatives
OBJECTIVES OF FINANCIAL DEPARTMENT
FINANCIAL POSITION
COST ACCOUNTING SYSTEM
FINANCE DEPARTMENT
Finance department is the lifeblood of every business. Availability of
sufficient funds at the required time is the key of success of a concern. As a
matter of fact finance may be said to the “circulatory system of the economic
body” making possible co-ordination between the different activities.
Functions of financial Department
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The function of financial management is to make intensive and economic
use of capital resources of the organization. Since business firms are profit
seeking organization, there functions are to maximize the companies’ wealth.
The primary functions are:
1. Profit Maximization
2. Maximization of return
Financial position of cryptms
The credit of the success of Cryptms goes to the finance department
because of the efficient administration of the firms financial resources and its
clever utilization helps to make successful completion each year business
targets.
The company has a paid up capital of 44.78 lakhs. Fixed assets contributes
to about 90.28lakhs... This consists of land at Thodupuzha, Factory and office
building, plant and Machinery, furniture and fixtures at factory and office,
electrical fittings at office, vehicles etc. Depreciation is provided following the
written down value method.
The current asset of the company includes sundry Debtors, inventories,
loans and advances, cash in hands and cash at bank. The current liabilities of
the company are sundry creditors, liabilities on salary, sales tax etc.
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The Canara bank provides the necessary working capital to the company.
The long term loans are provided by KFC. The company follows mercantile
system of keeping books of accounts. All the transactions are dealt through
cheque, bills of exchange, And Demand draft etc. The excise duty is paid in
advance.
Cost Accounting System
The costing system ensures strict control over expenses. Strict labour
control techniques are used for increasing the labour productivity and reducing
the idle time. Cryptms adopt standard costing system. Costing per month is
done for all the products. Cost per batch is considered. The standards are
compared with the actual. If the actuals vary from the standards, corrective
measures are taken by the executives. The company keeps cost cards for
accurate cost accounting records. The main ingredients of the products liquid
glucose, sugar, vegetable, fats, butter, milk powder etc. The purchase system is
centralized.
Structure of finance department
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Board of directors
Managing Director
Executive Director
Responsibilities of cost accountant
Provide a correct analysis of cost both by process or operations and by
different element of cost
Helps in preparation of budget & implementation of budgetary control
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Finance Manager
Accountant Cashier Clerk
Data entryOperators
Advice management on future expansion of policies and proposed capital
project
Organize the internal audit system to ensure effective working of different
department
Organize the cost reduction programmes with the help of different
department managers
Supply useful data to management for taking various financial decision
Helps in supervising the working of punched card accounting or data
processing through computers
Exercise effective control of stock of raw materials, work-in-progress,
consumable stores and finished goods in
Need of accounting system
The staff and officers working in various accounting section of the
division shall carry out there work effectively and efficiently as per the
guidelines. There should be close coordination and exchange of information
between the accounting sections of the division to ensure uniformity in the
accounting transaction, also the head of the various accounting section will
maintain close coordination with other department
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Needs of accounting system are:
To ascertain the result of operation i.e. profit or loss
To ascertain the financial position of the business i.e. solvency
To provide control over the assets and liabilities of the company
To provide information to tax authorities like sales tax, income tax , central
excise etc
Significance of accounting policies
a. Basis of accounting
The financial statement are prepare on accrual basis except sales return
which is accounted on receipt basis.
b. Fixed assets\ Depreciation
Depreciation on fixed asset is provided on straight line method at the rates
specified under schedule number XIV of the companies Act, 1956.
c. Investment
Investments are stated at cost.
d. Valuation of inventories
i. Raw material & Packing Material : At cost
ii. Stores and spare and consumables : At cost
iii. Finished Goods : Net realizable value
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iv. Work-in progress : At cost
e. Revenue Recognition
i. Revenue from sale of goods is recognized from passage of title to the
customer, which coincide with delivery.
ii. Sales comprises of sale value of goods less sales return
f. Earnings per share
Earnings per equity share are calculated by dividing earnings after tax by
number of equity shares held during the year.
g. Foreign Exchange Earning
It is converted at the rate of exchange prevailing one the date of transaction.
h. Income tax
Current year’s tax is determined in accordance with income tax Act, 1961
Sources of finance
Shares, Revenue and surplus and loan funds are the main sources of fund. Loans
are secured mainly from Canara Bank
RESEARCH & DEVELOPMENT DEPARTMENT
Cryptms has a fully equipped and well staffed research and development
division and a complement of the most modern and sophisticated machinery to
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test the quality and efficiency. This has been possible through a systematic
R&D programme under the able guidance of the technical officer.
The research and development department has evolved stringent method
for analyzing and testing raw materials and end products. A dedicated team of
research scientists and quality experts are engaged in research and development
of new formulation and standardization of sweets.
Specific areas
Raw material Standardization
Development of new products
Safety and efficacy study of new formulation
Benefits
Increasing quality of products
Development of new products
Continuation of new product development
Standardization of quality parameters of existing range of product
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CHAPTER V
67
SWOT ANALYSIS
Strength
High availability
High quality at low price
Efficient and well trained employees
The goodwill of the company
Weakness
Limitation of production capacity
Limited market penetration
Less variety of chocolates toffees, such as bar chocolates, lollypops etc.
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Opportunities
Improvement in market penetration
Expansion of production capacity
Introduction of product varieties and improved promotional efforts through
audio-visual media
Threats
Introduction of tattoos and stickers by competing confectionary companies
Advertising monopoly of parries and nestle in audio-visual media
Extended network of multinational companies with improved technology and
attractive packaging
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CHAPTER VI
Observations
The product are not expensive
There is no shortage of product
Cost of Inventory shows an increasing trend
The trend analysis of average working progress decline shortly in the
second year followed by a huge increase.
Majority of the people are aware about the brand name
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Goodwill of the company is high among customers
Most of the consumers are satisfied with the quality, price and durability
of Nirapara product.
Efficiency of inventory management is satisfactory and goes on better
position
SUGGESTIONS
Motivate all the retailers to purchase cryptms by providing
incentives and benefits to them.
Introduce stickers and tattoos to attract more consumers, especially
children
To concentrate more on promotional activities, particularly
advertisements through television channels and medias like magazines,
story books for children and newspapers
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Maintain the rate of margin and make this fact to all the retailers.
Introduce more number of varieties with new flavors
Provide more benefits and incentives to attract the retailers and to
ensure that incentives and benefits given by the company are reaching the
retailers.
Maintain the quality of the products and to conduct comprehensive
study to find out the company expectations and consumer specifications.
The company has to widen the market to other territories.
The company has to maximize the production to its capacity of 110
tones and thereby the company can reduce its cost.
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CHAPTER VII
CONCLUSION
The activities of the plant office and all other departments are functioning
at the impressive standards for achieving the organizational objectives. The
commitment and efficiency of the employee helped cryptms in capturing highly
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competitive market. Product diversification enables the organization to get a
prominent place among the corporate entities.
Sales turnover can be enhanced with the help of providing more
commission to retailers and damage allowances, van allowances, credit facility
etc. to distributors. Increasing the frequency of advertisement on mass media
will improve the product awareness among the public.
Productivity can be increased with the help of complete automation of
the production process. Strict quality control with the help of modern
equipments will enable the company to enter the international market.
BIBLIOGARPHY
PHILIP KOTLER - MARKETING MANAGEMENT.
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Various magazines like business India, India today etc
www.wikipedia.com
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