Body

Effectiveness of Logistics Management in KOJ, Dubai

CHAPTER 1

INTRODUCTION

SJCET School of Management, Palai1


1.1 INDUSTRY PROFILE

Logistics is the management of the flow of goods, information and other resources,

including energy and people, between the point of origin and the point of consumption in

order to meet the requirements of consumers. Logistics involve the integration of

information, transportation, and inventory, warehousing, material-handling and

packaging. The importance of logistics as an enabler of trade and economic growth is

worth mentioning. Massive improvement in infrastructure for transportation leads to

present and future development in trade, resulting in the economic growth of the nation.

On the positive point of view, new opportunities are opening up for the sector. Trade

volumes both overseas and inland are growing very fast. The pace of growth in the

specialized sectors like Liquid Natural Gas (LNG), Containers, Goods, Electronic

Equipments etc. are comparatively much higher. Integrated logistics and multimode

transportation are opening up new business for logistics/ shipping companies.

Logistics Management and Logistics Management Software

Logistics management is that part of the supply chain which plans, implements and

controls the efficient, effective forward and reverse flow and storage of goods, services

and related information between the point of origin and the point of consumption in order

to meet customers' requirements. A professional working in the field of logistics

management is called a logistician.

Software is used for automating logistics activities which helps the supply chain industry

in automating the work flow as well as management of the system. Very few generalized

software are only available in the new market in the said topology. This is because there

is no common rule to generalize the system as well as work flow even though the practice

is more or less the same. Most of the commercial companies do use one or the other

custom solution. There is various software that is being used within the departments of

logistics mainly in Conventional Departments and for Container Trucking.



A, Business Logistics

Logistics as a business concept evolved only in the 1950s. This was mainly due to the

increasing complexity of supplying one's business with materials and shipping out

products in an increasingly globalize supply chain, calling for experts in the field who are

called Supply Chain Logisticians. This can be defined as having the right item in the right

quantity at the right time at the right place for the right price and it is the science of

process having its presence in all sectors of the industry. The goal of logistics work is to

manage the fruition of project life cycles, supply chains and resultant efficiencies.

In business, logistics may have either internal focus (inbound logistics), or external focus

(outbound logistics) covering the flow and storage of materials from point of origin to

point of consumption. The main functions of a qualified logistician include inventory

management, purchasing, transportation, warehousing, consultation and the organizing

and planning of these activities. Logisticians combine the professional knowledge of each

of these functions so that there is a coordination of resources in an organization. There

are two fundamentally different forms of logistics. One optimizes a steady flow of

material through a network of transport links and storage nodes. The other coordinates a

sequence of resources to carry out some project.

B, Production Logistics

The term is used for describing logistic processes within an industry. The purpose of

production logistics is to ensure that each machine and workstation is being fed with the

right product in the right quantity and quality at the right point in time.

The issue is not the transportation itself, but to streamline and control the flow through

the value adding processes and eliminate non-value adding ones. Production logistics can

be applied in existing as well as new plants. Manufacturing in an existing plant is a

constantly changing process. Machines are exchanged and new ones added, which gives

the opportunity to improve the production logistics system accordingly. Production

logistics provides the means to achieve customer response and capital efficiency.

Production logistics is getting more and more important with the decreasing batch sizes.

Even a single customer demand can be fulfilled in an efficient way. Track and tracing,



which is an essential part of production logistics - due to product safety and product

reliability issues - is also gaining importance especially in the automotive and the medical

industry.

1.2 COMPANY PROFILE

Kamal Osman Jamjoom Trading LLC is a multi-channel retail group or one of the

leading retailers in the Middle East and they mainly concentrated on Kids toys, Arabic

ladies lingerie’s & fashion, Cosmetics, Perfumes and Fragrances, that has operational

headquarters in Dubai, United Arab Emirates and a Financial Regional Office in Jeddah,

Saudi Arabia.

The company was established in 1987 and operates four leading International and

regional brands, being The Body Shop, Early Learning Centre, Nayomi and Mikyajy. The

company has a retail footprint of 500 stores in the Middle East, with regional offices and

representation in Saudi Arabia, United Arab Emirates, Bahrain, Kuwait, Qatar and Oman.

There are mainly seven brands dealing by KOJ, in which five of them are franchisee

brands and two of them are own brands. The five franchisee brands include ELC (Early

Learning Centre), BEBE, ULLEPOPKEN, LIST and BODYSHOP, and the two own

brands include MIKYAJY and NAYOMI. All these brands have a strong presence in

Saudi Arabia, United Arab Emirates, Bahrain, Kuwait, Qatar, Oman and Libya. They are

also expanding to new markets like Egypt and Lebanon in the near future.

Over the next few years, there are plans to expand in the Gulf region with 100 to 120

new stores. The company is looking at reaching out to new customers in other regions

such as Egypt, the Levant, East Asia, Eastern and Central and Western Europe.



1.2.1 ORGANIZATIONAL CHART OF SUPPLY & DISTRIBUTION

Fig. 1



1.2.2 GLOBAL LEVEL VIEW OF KOJ ORGANIZATIONAL STRUCTURE

Fig. 2



1.2.3 SHIPPING PROCESS IN KOJ

Shipping through importing is a thirteen step process:

1. Shipment Information / readiness date / required date etc.

2. Shipment forwarders

3. Shipment FDC

4. Shipment Nomination & Rate negotiation

5. Document arrangements

6. ETD/ETA

7. PO tracker update

8. Clearance status

9. Delivery Arrangements

10. Shipping Notification

11. Freight invoice reconciliation

12. Invoice submission to the finance

13. FDC reports

1. Shipment Information / readiness date / required:

This is the shipment readiness date from the supplier. Required date is when the goods

should be available in the destination warehouse in order to distribute the goods to the

stores.

2. Shipment forwarders:

Forwarders are the external service providers who is handling directly dealing with

airlines, shipping lines, customs & have a tie up different agents & own offices at the

origins.

3. Shipment FDC:

Shipment FDC includes Freight, duty & clearance charges, these are the additional

“Expenses” to bring the shipment from origin to destination.



4. Shipment Nomination & Rate negotiation:

Nominations is customer (KOJ) will nominate the shipments to X, Y, Forwarders to

handle the shipments. Rate negotiation is customer will negotiate the freight rate based

the volumes in order to reduce the expenses (Freight Charges).

5. Document arrangements:

It is the documents requirements for doing the shipment clearance at origin. In order to

prove that the imported goods belongs to the exporting country with whom the trade

agreement has been entered into, the importer has to present to customs authorities a

certificate called the ‘Certificate of origin’. This document certifies the name of the

country in which the goods manufactured.

6. ETD/ETA:

The term ETD is the estimated or expected time of departure from the port or point of

origin; it applies to all modes of transportation. ETD is shipment on or about. The

term ETS is the estimated or expected time of sailing from the port of origin; it applies to

ocean freight. ETS is sailing on or about. The term ETA is the estimated or expected time

of arrival at the port or point of destination; it applies to all modes of transportation.

7. PO Tracker Update:

Updating the shipments movements based on the ETD/ETA in the tracking file by PO

wise. PO represents purchasing order.

8. Clearance status:

It represents Shipment customs clearance at origin.

9.Delivery Arrangements:

After the shipment clearance at destination, shipment has to be delivered to customer’s

warehouse. This step should be done by so carefully by the external partners.

10. Shipping Notification:

Once the shipment is delivered to customers (KOJ) warehouse, KOJ Shipping will notify

to all the relevant people regarding the delivery.

11. Freight invoice reconciliation:

Verifying the invoices from forwarders against the agreed contract rate for freight &

customs clearance charges.



12. Invoice submission to the finance:

KOJ Shipping will submit the freight forwarders invoices to finance dept for arranging

the payment to forwarders.

13.FDC reports:

It the expenses & lead time reports for a particular month for all the shipments which are

delivered to KOJ & It will be shared to all the relevant teams to KOJ. It also includes

other reports such as insurance report, damage, shortage and overage report.

MAN POWER PROFILE IN SHIPPING

Fig. 3



1.2.4 WAREHOUSING PROCESS IN KOJ

A set of guidelines, procedures and policies are established for KOJ’s distribution centre

operations in order to establish control, measure, responsibility and accountability in the

organization.

INBOUND OPERATIONS:

Receiving, Return to Vendors, Put away and storage constitutes the inbound operations in

KOJ.

1. Receiving:

Receiving procedure framed by the KOJ should be strictly followed by all warehouse

personnel. Incoming stocks upon unloading shall be palletized squarely to avoid damage

during handling. Purchase Order (PO), Delivery Receipt (DR), or Sales Invoice should be

properly maintained. Samples should be taken from each receipt by Quality Control Staff

for quality control check. The items which are rejected by QC will be marked as ON

HOLD..

2. Return to Vendor (RTV):

If any QC rejection found, it shall be marked as Return to Vendor. The KOJ Shipping

department shall be informed the details of RTV to be processed, so that appropriate

documentation and transportation can be arranged.

3. Put away:

Put away procedure framed by the KOJ should be strictly followed by all warehouse

personnel. Receiving supervisor who receives the container will immediately handover it

to the Put away and Replenishment Supervisor. He will endorse it to formalize the

ownership of the container.

4. Storage:

All merchandise in the warehouse is tracked by its Container ID (CID) barcode. All

information regarding the product, such as, Item ID, Item Description, quantity, date of

receipt, date of put away, expiry date, etc, are contained in the CID barcode.



OUTBOUND OPERATIONS:

1 Distribution planning:

Distribution planning procedure framed by the KOJ should be strictly followed by all

warehouse personnel, relevant Supervisors and Team Leaders. The Picking Schedule

shall be prepared by the Distribution Planning Supervisor, with inputs from and

coordination with the Warehouse Management and Merchandise Planning Department..

2. Picking:

Upon receiving of Picking Labels from the Team Leaders or Distribution Planning

Supervisor, the Pickers shall proceed to the zone indicated in the Zone header

and check for the type of picking indicated in the picking label header. The Pickers need

to completely finish the pick directives in the wave before staging the picked stocks in

the sorting area.

3. Dispatch:

Firstly ensure that all the containers endorsed by the Pickers are properly labeled with

Container ID barcodes. A Delivery Note, containing details regarding the number of

pallets being shipped shall be prepared by the Dispatch In-charge to accompany the

shipment.

The Delivery Note and Container Manifest shall go together with the shipment to the

shops, where they will be signed-off by the Receiver at destination. The container that is

scheduled to be loaded only should be stored near shipping door. It should be clean, dry,

odor free etc. Logbook of the dispatched truck should be maintained.

4. Delivery schedule:

Products must reach stores in time. If it is delayed it means lost sales. Every day except

Friday products are delivered from warehouse to stores. Delivery schedules & timings

may change according to season, and to accommodate new shops in new areas as well.

Warehouse operations timings may change depending upon operational requirements, so

it should consider while framing delivery schedule. Any changes in the delivery schedule

should be properly communicated to everyone.

ABOUT THE WAREHOUSE IN KOJ


Effectiveness of Logistics Management in KOJ, DubaiThe warehouse size is 1500 square meters. Three brands – Nayomi, Mikyajy, and ELC

can be stored in this warehouse. There is also a third party warehouse in Jabel Ali Free

Zone. Jabela Ali is used to save space inside the warehouse because excess items will

move to this warehouse.

.

Fig. 4

MANPOWER PROFILE IN WAREHOUSING



Fig. 5

1.2.5 MISSION OF KAMAL OSMAN JAMJOOM

KOJ’S mission statement stand s mainly on three pillars, they are…

1. GOOD PEOPLE FIRST

KOJ people are people with character - this means they practice honesty, commitment,

respect, trust and passion. We are the people who turn ideas into sales, profit, and

sustainable growth. Good people are the heart of our business. We embrace teamwork

and believe that none of us is better than all of us together.

2. START AND END WITH CUSTOMER SERVICE

Everything we do is aimed for our customer's hands, their hearts and their minds. The

good people at KOJ start every task with the customer in mind. All of our business

activities start with passionate front-liners who give our customers a great total shopping

experience.

3. ENSURE PROFITABILITY FOR ALL STAKEHOLDERS


Effectiveness of Logistics Management in KOJ, DubaiKOJ Trading LLC was created to improve the quality of life for everyone who belongs to

it. This includes our shareholders, our suppliers, our lawyers, our contracts, and us - the

employees! We endeavor to achieve mutual benefits and profits for everyone and

continuously strive to find ways to enhance our bottom line. Our philosophy is that we all

own the bottom line. This is our company!

1.2.6 SUCCESS STORY OF KAMAL OSMAN JAMJOOM

Kamal Osman Jamjoom Group (KOJ) is one of the leading retailer in the middle east

which offers successful and innovative brands in the beauty, fashion, healthcare and

children's learning and development sectors. They have an unshakeable commitment to

product excellence and customer satisfaction, which is expressed in our portfolio of

brands.

In 1987, the Body Shop franchisee is acquired and the first store is opened. In 1992, The

Nayomi brand is launched. In 1994, Early Learning Centre franchise agreement for

Middle East is signed. In 1999 The Mikyajy brand is launched. In 2002 Corporate Head

Office of KOJ is established in Dubai. In 2003 Nayomi launches its award-winning

website. In 2006 Mikyajy launches its website and KOJ reaches the 300 store

benchmark. In 2007, European regional office is established and Egypt regional office is

established. In 2008, Mikyajy opens first store in Greece and KOJ reaches the 400-store

benchmark.

Also Nayomi is currently the largest lingerie chain in the Middle East. Mikyajy is the

largest single cosmetics brand in the Middle East with the largest single-brand market

share. The Body Shop franchise is the largest in the Middle East, and 2nd largest in

Europe, Middle East and Africa, and has the largest Average Transaction Value globally

for the brand.KOJ innovated The Body Shop trolley concept. The Early Learning

Centre in the Middle East is the largest sales contributor globally. KOJ partnered with

three additional international brands in 2009-2011..


Effectiveness of Logistics Management in KOJ, DubaiBENEFITS OF KOJ

1. KOJ Values its people, through mission statement "Good people first". They

therefore reward them competitively.

2. They attract and retain the people responsible for the company's long-term growth

and profitability.

3. All employees are provided with the opportunity to contribute to its success by

offering a great working environment.

4. No one is discriminated on the basis of their background. They value Diversity.

Employment and Development is primarily on merit. By this KOJ provide equal

opportunity employment.

5. For going the extra mile or having a brilliant suggestion, they reward their

employees through recognition and excellence awards

1.2.7 MILESTONES OF KOJ

A remarkable journey of success:

1978 The Body Shop franchise is acquired and the first store is opened

1992 The Nayomi brand is launched

1994 Early Learning Centre franchise agreement for Middle East is signed

1999 The Mikyajy brand is launched

2002 Corporate Head Office is established in Dubai

2003 Nayomi launches its award-winning website

2006 Mikyajy launches its website KOJ reaches the 300-store benchmark



2007 European regional office and Egypt regional office is established

2008 Mikyajy opens first store in GreeceKOJ reaches the 400-store benchmark

Table 1

The company was formed as one of the earliest Body Shop franchises internationally and

remains one of the most successful. Over the years the company has now become a

franchisee, franchisor and own brand channel organization.

This depth of skills and knowledge allows for rapid deployment of strategies and tactical

initiatives. The group employs over 2000 staff through seven countries. The staff

represents a true global index of nationalities from more than 50 countries worldwide.



1.3 INTRODUCTION TO THE TOPIC & JUSTIFICATION

FOR CHOOSING THE TOPIC

A. Introduction to Logistics Management

Logistics management is that part of the supply chain which plans, implements and

controls the efficient, effective forward and reverse flow and storage of goods, services

and information between the point of origin and the point of consumption in order to

meet customers' requirements. A professional working in the field of logistics

management is called a logistician.

Logistics as a business concept evolved only in the 1950s. This was mainly due to the

increasing complexity of supplying one's business with materials and shipping out

products in an increasingly globalize supply chain, calling for experts in the field who are

called Supply Chain Logisticians. This can be defined as having the right item in the right

quantity at the right time at the right place for the right price and it is the science of

process having its presence in all sectors of the industry. The goal of logistics work is to

manage the fruition of project life cycles, supply chains and resultant efficiencies.

B. Origin and Definition of Logistics:

The term "logistics" originates from the ancient Greek "λόγος" ("logos"—"ratio, word,

calculation, reason, speech, oration"). Logistics is considered to have originated in the

military's need to supply themselves with arms, ammunition and rations as they moved

from their base to a forward position. In ancient Greek, Roman and Byzantine empires,

there were military officers with the title ‘Logistikas’ who were responsible for financial

and distribution of supplies.

The Oxford English dictionary defines logistics as: “The branch of military science

having to do with procuring, maintaining and transporting material, personnel and

facilities.” Another dictionary definition is: "The time related positioning of resources."

As such, logistics is commonly seen as a branch of engineering which creates "people

systems" rather than "machine systems"....



What is Logistics?

Logistics involves getting the right goods to the right place, at the time, at the right cost,

in the right condition, and with due care and attention to the environment. The Institute of

Logistics defines logistics as ‘the time related positioning of resources’ within the supply

chain. Academics define it as ‘the management of the chain from source of procurement

to the final user’

A few other definitions:

Logistics is “a set of distribution-activities,” that make products available to customers

when and where they need them.

The council of Logistics Management defines it as:

“The process of planning, implementing and controlling the efficient, cost-effective flow

and storage of raw materials, in-process inventory, finished goods, and related

information from point-of-orgin to point-of-consumption for the purpose of informing to

customer requirements.”

Logistics commonly includes:

Transportation

Warehousing

Inventory/Stock control

Communication/Information systems

Packaging

Manufacturing management

In business, logistics is fundamental to:

Retailing

Production management & control

Forecasting

Purchasing & supply

Materials management

Packaging

Installation & servicing

Property


Effectiveness of Logistics Management in KOJ, Dubai Quality

Order processing

Project management

Re-use & recycling

Information technology

Importing & exporting.

Logistics is also fundamental to:

Governments

The armed forces

Welfare agencies

1.4 NEED FOR THE STUDY

In years gone by, the traditional warehousing and logistics facility was located by railroad

tracks, a water port, and/or freeways, usually in the least desirable parts of cities or large

towns. This stereotype then faded as gigantic, state-of-the-art facilities began to sprout in

more rural areas on the outskirts of transportation and population hubs. The World started

beginning to see such facilities showing up in even less "traditional" areas. Modern

warehouses now are being located in carefully manicured industrial parks that are

sprouting as fast as the corn and wheat once did in these open spaces-often in out-of-the-

way places. Why the emphasis on such locations for logistics companies?

Much of it is due to the great flux that the logistics industry has been undergoing in the

first three years of the 21st century. Most of these changes are being driven by a growing

trend in the manufacturing and retail sectors to form partnerships with companies to

which they can outsource non-core logistics competencies-3PL providers.

In turn, 3PL providers are continually looking to provide innovative supply chain

solutions to customers by focusing on value-added capabilities, differentiating themselves

from the competition. They focus on key objectives, such as implementing information

technologies, instituting effective management processes, integrating services and


Effectiveness of Logistics Management in KOJ, Dubaitechnologies globally, and delivering comprehensive solutions that create value for 3PL

users and their supply chains. This need to partner with customers and become more

integrated into their supply chain processes has created the ancillary need to locate close

to these customers.

That isn't to say the need for easy access to transportation hubs and different modes of

transportation won't continue to be important. But the above shift in business strategy,

along with the advances in technology and enhanced communication, has opened the

door for logistics facilities to operate effortlessly in a myriad of locations.

Profit warnings, share price pressures, mergers, reorganizations, relocations, disposals,

painful layoffs and great geopolitical uncertainties can sweep away even the most

comprehensive logistics strategies – and that’s despite outstanding management over

many years. These are exceptionally difficult times and it has never been more important

to connect logistics and freight planning to executive board thinking than now. It’s easy

to lose sight of the bigger picture in the rush to cut infrastructure cost and conserve cash.

Hopefully organization succeed in protecting the business, satisfying shareholders and

analysts, but what about capacity and flexibility, morale and momentum?

To be a logistics winner in the coming years organizations need to use the downturn to

reshape for growth, propelled by an unshakeable conviction that the mission is still

important, that more prosperous times lie ahead, and that in some way the company

infrastructure is helping to build a better kind of world.

Logistics is inevitable in the future and essentially the management policy also has a

significant role in the future of world. Generally the study is being featured with all

aspects of management in Logistics and Freight areas. (Logistics include Transportation,

Warehousing, Network Design, Cross docking, and Value Adding).



1.5 OBJECTIVES OF THE STUDY

To find out the Effectiveness of logistics management in KOJ.

To know how the logistics is done in KOJ.

To have a thorough understanding of how logistics and freight industries

work.

To study the various brands that the company deals with.

To find out how the brands of KOJ reach from manufacturer to the

distribution centre

To find out the importing & re-exporting process of KOJ.

To know the warehouse management system of KOJ.

To know whether the customers are satisfied with the existing range of

service pattern



CHAPTER 2

THEORECTICAL

ASPECTS OF THE TOPIC



2.1 THEORECTICAL ASPECTS OF THE TOPIC AND REVIEW OF LITERATURE

Logistics is the management of the storage and movement of goods and information.

Good logistics cuts costs; speeds work, and improves customer service. Logistics also

involves the coordinated management of material and information flows throughout your

organization.

Supply Chain Management deals with the same issues throughout the chain from your

sources to your customers. Its objective is to simplify the supply chain to control total

cost, improve total quality, maximize customer service, and increase profit.

Comparing Logistics and Supply Chain Management

Supply chain management is about getting a smooth and efficient flow from raw material

to finished goods in your customer’s hands. It is a concept, which is increasingly

replacing traditional fragmented management approaches to buying, storing and moving

goods.

Traditionally, the management of material flows has centered on stocks of product: on

trains and boats and trucks; in warehouses and stores and factory-floor queues. Managing

those stocks meant buying enough goods far enough in advance to ensure that long,

steady production runs were seldom jeopardized by shortages of components. Tougher

competition has brought shorter product life cycles and made that approach increasingly

expensive. Replacing these ‘inventory-driven systems’ are ‘service-driven systems’. This

type of system, ‘pulled’ by customer demand rather than ‘pushed’ by a supply system, is

long-familiar in retailing and over the last decade has become a necessity in many

manufacturing sectors.

2.2 REVIEW OF LITERATURE

A. Demand Chain Management

Understanding demand requires a comprehensive knowledge of your customers, you

should know what products / services are demanded by your customers; how do them


Effectiveness of Logistics Management in KOJ, Dubaimake their purchases, how often they order and what constraints they face on the

purchasing process. Very few companies have mastered this concept. KOJ was able to

know all the above concepts through considerable focus into customer needs and

grievances.

B. Achieving Competitiveness in Logistics, Freight, Supply Chain

Fig. 6

Reduced lead time, inventories, lower operating costs, product availability and customer

satisfaction are the benefits which grow out of effective logistics and supply chain

management. The decisions usually carried on by KOJ, cover both the long term and

short term. Strategic decisions deal with the corporate policies, and look at overall design

and logistic chain structure. Tactical, Operational decisions are those dealing with

everyday activities and problems of the organization. Change is the inevitable factor for

each and every day situation within and outside the organization. The decisions must take

into account the strategic decisions already in place. Therefore organization must

structure the logistics ideas through long term analysis and at the same time focus on


Effectiveness of Logistics Management in KOJ, Dubaievery time situations. Furthermore, market demands, customer needs, transport

considerations and pricing constraints are the factors in order to structure the logistics,

freight. KOJ realized the fact and are prepared to face any unexpected situations like

inflation/ deflation in the economy, price factors, climatic problems etc.

C. Operational Fleet Routing & Loading

The organization derives routes in transportation are mainly long-haul (Optimization).

For short haul deliveries, there are ready solutions that are tightly integrated to warehouse

management systems (outsourced facility), to efficiently route fleets of vehicles and

vessels and plan picking and loading. Stipulated time windows for pick-ups and

deliveries and vehicular weight and spatial capacities would be used, as will constraints

such as delivery within specified period minutes upon pickup (useful for perishable

goods). Time required at various stops - in terms of fixed time to park and variable time

dependent on amount to be loaded or off-loaded - can be specified. Travel speeds along

various types/zones of roads can be stipulated by traffic information services. The

organization schedules arrival and departure times for each stop can thus be worked out

quite accurately. Routes can be generated dynamically and ad hoc backhaul or other

opportunities can also be assigned to the most suitable vehicle. The benefits of

operational fleet routing include considerable reduction in fleet operating cost and

improved customer service with better estimated arrival time.

D. Vendor Managed Inventory

Vendor managed inventory, coordinated by an integrated logistics system, allows

inventory to be optimized together with transportation. KOJ try to know the product

value as well as storage capacity (mainly warehouse – how much to outsource). As a

routine job the company collects information on consumption rate, current inventory

levels, forecasted demand and status of shipments. Thus the system can optimize the right

quantities of replenishments to be sent at the right time to ensure that service levels are

maintained while minimizing cost of inventory and transportation.



E. Mode of Transportation

Transportation generally is movement of product, goods, raw materials to different stages

in supply chain. Essentially in supply chain logistics plays a major role, the manner in

which product is moved from one location to another is through road, rail, truck, air, sea.

KOJ logistics essentially uses only 2 modes for their operation they are air and sea. The

goods being delivered to end customer is brought to port or to the place through

containers or other methods like wagons, or cold enclosures like frozen storage. As in

UAE rail transport does not exist, so it has got a relevant drawback for the company, as

company has to stick on road for short routes and even routes between states of UAE and

which is very much expensive and increases the operational cost. KOJ strategically

manage the procurement, movement, and storage of materials, parts and finished

inventory through the organization and its marketing channels. Essentially from

companies’ angle, there are two categories, initially inbound logistics, i.e., handling

goods that are brought into the company, through road transport and storing and making

them available. Another main phase is the outbound logistics, taking the cargo or the

goods through channels, and is being done with considerable effort to various parts of the

world as per the customer requirements.

F. The Challenge Faced by Organizations

In today’s world, competence is taking on new dimensions. The ability to compete is

being determined by the degree of responsiveness to customers and key issues handling.

How fast you deliver the goods/ products, what the price paid by customers and what

value customer is getting throughout the service is considered in a schematic and ordered

way. Markets are quick demanding and customization of each logistics activities is

essential for each customer, and has become the essential factor in logistics management.

KOJ faces lot of ups and downs in each operation and improves operation on each

situation while dealing with each customer. KOJ dominant improvement methods used

are:

i. What are the customer expectations?


Effectiveness of Logistics Management in KOJ, Dubaiii. How are your competitors performing in each aspect of operations?

iii. Determining the gaps in each phase and try to fill it.

G. Economic Ordering Quantity (EOQ)

Efficient order quantities consider the Purchase Order Cost (POC), the Annual Demand

rate (AD), the Inventory Carrying Rate (ICR), and Unit Inventory Volume (UIV). Large

Order Quantities yield high inventory levels and high inventory carrying costs but fewer

orders and lower ordering costs. High ordering costs and demand rates suggest large

order quantities. High ICRs and high unit inventory values suggest small order quantities.

Generally during research the analysis shows, few organizations believe EOQ analysis is

outdated and quite few with enhanced focus on it. There is relevant need for EOQ in this

era. EOQ analysis should be completed as a part of any inventory strategy. The analysis

suggests appropriate reordering intervals for all items each organization is handling.

Competitors focus on reducing the costs of placing purchase orders. The lower the

purchase order cost, the more economical it becomes to order in small increments and the

less inventory will be there in the system. The purchase order costs is typically dominated

by the labour and paperwork costs of planning, negotiating, executing and tracking

purchase orders. Large number of organization extent to which these functions can be

automated via automated purchase order planning, e-procurement, online catalogs, online

bidding and online exchanges, is the extent to which inventory levels and lost sales costs

may be reduced in the supply chain and there to the efficiency of logistic operations.



2.3 STUDIES ON INVENTORY, BACK ORDER, LOST SALES, STOCK OUTS, PACKAGING & PACKAGING MATERIALS, DOCUMENTATION FROM KOJ

A. Inventory

Inventory is a list for goods and materials, or those goods and materials themselves, held

available in stock by a business. Inventory are held in order to manage and hide from the

customer the fact that manufacture/supply delay is longer than delivery delay, and also to

ease the effect of imperfections in the manufacturing process that lower production

efficiencies if production capacity stands idle for lack of materials.

There are three basic reasons for keeping an inventory:

i. Time - The time lags present in the supply chain, from supplier to user at every

stage, requires that you maintain certain amount of inventory to use in this "lead

time"

ii. Uncertainty - Inventories are maintained as buffers to meet uncertainties in

demand, supply and movements of goods.

iii. Economies of scale - Ideal condition of "one unit at a time at a place where user

needs it, when he needs it" principle tends to incur lots of costs in terms of

logistics. So Bulk buying, movement and storing brings in economies of scale,

thus inventory.

B. Back Order

A company having to back order an item that is out of stock will incur expenses for

special order processing and transportation. The extra order processing traces the back

orders movement, in addition to the normal processing for regular replenishments. The

customer usually incurs extra transportation charges because a back order is typically a

smaller shipment and often incurs higher rates. The seller may need to ship the back

ordered item a longer distance. The seller may need to ship the back order by a faster and

more expensive means of transportation. We could estimate the back order cost by

analyzing the additional order processing and additional transportation expense. If

customers always back ordered out of stock items, the seller could use this analysis to



estimate the cost of stock outs. The seller could then compare this cost with the cost of

carrying excess inventory.

C. Lost Sales

Most companies have competitors who produce substitute products, and when one source

does not have an item available, the customer will order from another source. In such

cases the stock out has caused a lost sale. The seller’s direct loss is the loss of profit on

the item that was unavailable when the customer wanted it. Thus, a seller can determine

the direct loss by calculating profit on one item and multiplying it by the number the

customer ordered.

E.g.: If the order was 100 units and the profit is 10$, the loss is 1000$.

If the effort is made by a sales man and if the effort is wasted and in that sense it is an

opportunity loss. Whether including such a cost is valid would depend upon whether the

company uses sales people in its marketing effort.

Another aspect is determining the amount of a lost sale may be different and difficult in

certain circumstances. Numerous companies customarily take orders by telephone. A

customer may initially just enquire about items availability without specifying how much

is desired. If an item is out of stock, the customer may never indicate a quantity and the

seller will not know the amount of the loss.

D. Stock out

Cost incurred to a firm when current inventory is exhausted for one or more items. Lost

sales revenue costs are incurred when the firm is unable to meet current orders because of

a stock out condition.

E. Packaging and Packaging Materials

Mainly this is a main division in warehouses. Packaging interacts with the logistics

system in number of different and important ways. The size of and protection afforded by

the package affect the type of materials handling equipment used and the level of product



damage incurred. The package has an impact on the stacking height of the product in the

warehouse and thereby on the utilization and cost of the warehouse. Packaging is quite

important for effective damage protection, not only in the warehouse but also during

transportation. Packaging may contribute nothing to a products value but its influence on

logistics costs is considerable.

Packaging size may affect a company’s ability to use pallets or shelving or different types

of materials handling equipment. Many companies design packages that are too wide or

too high for efficient use of either a warehouse or transportation carrier. So, coordinating

packaging with warehousing and with transportation is quite important. We need to note,

poor packaging can contribute to higher handling charges and result in lower future sales

if the goods arrived damaged.

Two types of packing exist: consumer packaging and industrial packaging. Consumer

packaging provides information important in selling the product. i.e. giving the product

most visibility when it comes with others on the retail shelf. On the other hand industrial

packaging is of primary concern to the logistics. The packaging protects goods that a

company will move to store in the warehouse and also permits the company the effective

use of transportation vehicle space.

Materials generally used in previous years was wood and other harder materials for no

breakage, but it added considerable shipping weight to the transport and it further

increased transportation cost. Generally new era has come up with efficient packaging

materials, organization nowadays use most cost effective packaging with focus on

security and minimizing cost. Cushioning materials protect the product from shock,

vibration, and surface damage during handling. Cushioning materials include shrink

wrap, air bubble cushioning, cellulose wadding, and plastics. Companies often use shrink

wrap for consumer packaged goods. Packaging also helped reduce pilferage and product

tampering in warehouse and during transport. Air bubble cushioning is made of plastic

sheets that contain air pockets.



CHAPTER 3

RESEARCH

METHODOLOGY



3.1 RESEARCH

Research means search for knowledge. It aims at discovering the truth. It is the search for

knowledge through objective and systematic method of find solution to problems.

Therefore research is a process of systematic and in-depth study or search of any

particular topic, subject or area of investigation backed by collection, computation,

presentation and interpretation of relevant data.

Research is necessary to examine the extent of the validity of the old conclusions or to

find out some new facts and generating new ideas in connection with the existing ones. A

research finding may give rise to new problems which may require further research. So a

research leads to another research.

3.2 MAIN OBJECTIVE OF THE RESEARCH

The main objective is to find the effectiveness of logistic management in Kamal Osman

Jamjoom and also to find how the employees do their work in KOJ.

3.3 RESEARCH PROBLEM

The need for the study was to assess the effectiveness of Logistics Management in the

KOJ. The organization also needs relevant data as to how it can improve its management

policies in order to gain future market share.

3.4 RESEARCH METHODOLOGY

Research methodology is a method that can be used to solve the research problem. It

provides various steps that can be adopted by the researcher in studying his research

problems. It includes not only the research but also considers the logic behind those

methods. Research methodology deals with the objectives of a research study, the method


Effectiveness of Logistics Management in KOJ, Dubaiof defining the research problem, the type of hypothesis formulated, the type of data

collected, methods used for collecting the and analyzing the data etc.



3.5 CENSUS SURVEY

All items in any field of inquiry constitute a universe or population. A complete

enumeration of all items in the population is known as Census Enquiry or Census Survey.

It can be presumed that in such an inquiry, when all the items are covered, no element of

chance is left and highest accuracy is obtained. This type of inquiry involves a great deal

of time, money and energy.

Kamal Osman Jamjoom Trading LLC is a multi-channel retail group or one of the

leading retailers in the Middle East consists of more than 500 retail stores and more than

1000 of employees. But in order to find the effectiveness of logistics management in

KOJ, we want to take the information’s only from the employees of logistics department.

So I think Census enquiry will be the most appropriate method of finding a solution to

my research problem.

So, I used Census Inquiry for the study, as I am interested in getting an inexpensive

method to find out the truth. Logistics Department in KOJ Consists of 45 employees. So I

took the opinions of all the employees in this department with the help of a questionnaire.

In this way I can clearly state that the Effectiveness of logistics management in KOJ is

excellent or not.

3.6 METHOD OF DATA COLLECTION

Primary Data: The major tool used was interview with logistic manager, supervisor and

a questionnaire was developed focusing various aspect.

Secondary Data: Various books of Logistics Management for literature reference,

Internet Web Portals, Websites of the firm, Company shipping and warehousing manual.

3.7 QUESTIONNAIRE METHOD

This is an important and very popular method of data collection. This is adopted by

individuals, organizations and Government. In this method a questionnaire is prepared


Effectiveness of Logistics Management in KOJ, Dubaiand sent to respondents. The questionnaire when sent to the respondents, a request is

made that the questions should be answered and returned. The success of this method

largely depends on the proper drafting of questions. Drafting questionnaire required a

great deal of skill and experience.

3.7.1 CONSTRUCTION OF QUESTIONNAIRE

Following steps are to be followed in constructing a questionnaire.

1. Explaining the model and specifying the variables to be measured.

2. Framing of a questionnaire

1. Form of a questionnaire

2. Question sequence

3. Question formulation and wording

3. Pilot survey or Pre-testing

4. Printing of the questionnaire

5. Methods for administering questionnaire

3.7.2 ESSENTIALS OF A GOOD QUESTIONNAIRE

1. The person conducting the survey must introduce himself and the objects

of the survey. There must be a covering letter along with the questionnaire. The

letter should state the purpose of enquiry. It should assure the respondent that these

answers will be kept in strict confidence of questions.

2. The number of questions should be kept to the minimum. The number of

questions should be limited to the object and scope of the investigation.

3. The questions should be as short as possible and be simple to understand.

If the number of questions is too large, informants choose not to fill up the

questionnaire. The questions requiring calculations should be avoided.

4. The questions must be arranged in a logical order so that a natural and

spontaneous

reply follows.

5. The question should be clear. As far as possible simple words should be

used.


Effectiveness of Logistics Management in KOJ, Dubai6. As far as possible personal questions should be avoided.

7. As far as possible the questions should be such a nature that they can

answered

easily in ‘Yes’ or ‘No’ or in a number.

8. Questions which are unduly inquisitorial should be avoided.

9. The questions should be such that they elicit the information required for

the study

of the problem.

10. Instructions in regard to the filing up of the form must be given in the

questionnaire itself.

11. The questionnaire must be of convenient size and easy to handle.

12. Questionnaire should look attractive.

3.7.3 ADVANTAGES

1. There is low cost even when the field of enquiry is very large.

Therefore for covering vast area this method can be applied.

2. Answers are furnished by the respondents directly. So the

personal bias of the interviewer is absent.

3. Saves time because many respondents can be approached

simultaneously.

4. The questionnaire method is useful for collecting information

about a particular

type of problem since in the questionnaire various points can be included.

3.7.4 DISADVANTAGES

1. Most of the respondents are lazy and so they do not care to answer and return the

questionnaire.


Effectiveness of Logistics Management in KOJ, Dubai2. The method will be successful only if the respondents are educated and

cooperative.

3. The respondent’s answers may not be adequate. The replies will be ambiguous

and there may be many omissions of replies.

4. The respondents may take much time to return the questionnaires.

3.8 TYPES OF ANALYSIS

a) Descriptive Analysis

Descriptive analysis is largely the study of distributions of variables. The variables are

associated with the characteristics of items under study. In such analysis, there is the

study of one variable, two variables or more than two variables, but largely of one

variable.

b) Inferential Analysis

This is concerned with drawing inferences and conclusions from the findings of the

study. It enables us to make decisions and draw conclusions from studies which could

otherwise be not feasible, because of large size of the universe or of high costs of a

census survey.

3. 9 STATISTICAL TOOLS

Percentage Analysis

The purpose of using ratio or percentage is to simplify the problem of comparison.

Percentages reduce two distributions to a common base, thus make comparison

simple.

Bar Diagrams

A bar chart or bar graph is a chart with rectangular bars with lengths proportional to

the values that they represent. The bars can be plotted vertically or horizontally.


http://en.wikipedia.org/wiki/Length

http://en.wikipedia.org/wiki/Rectangle

http://en.wikipedia.org/wiki/Chart


Pie Charts

A pie chart (or a circle graph) is a circular chart divided into sectors, illustrating

proportion. In a pie chart, the arc length of each sector (and consequently its central

angle and area), is proportional to the quantity it represents. When angles are

measured with 1 turn as unit then a number of percent is identified with the same

number of centiturns.

CHAPTER 4

ANALYSIS AND INFERENCES


http://en.wikipedia.org/wiki/Turn_(geometry)

http://en.wikipedia.org/wiki/Proportionality_(mathematics)

http://en.wikipedia.org/wiki/Area

http://en.wikipedia.org/wiki/Central_angle

http://en.wikipedia.org/wiki/Central_angle

http://en.wikipedia.org/wiki/Arc_length

http://en.wikipedia.org/wiki/Circular_sector

http://en.wikipedia.org/wiki/Chart

http://en.wikipedia.org/wiki/Circle


DATA ANALYSIS AND INFERENCES

The data collected through the questionnaire are analyzed to know about the respondents

opinions about various particulars asked in the questionnaire. The data collected from the

questionnaire was entered into spread sheet and the data has been interpreted. The

questionnaire comprises of fourteen questions with subparts for each.

The topics covered are with decisions of each operational area, employee numbers of

each firm, profitable area in operation, catering location, service offering, organizational

effectiveness, inventory, location, product availability and customer satisfaction.

Analysis of data is considered to be highly skilled and technical job which should be

carried out only by the researcher himself or under his close supervision. It is through

systematic analysis that the underlying features of the data are revealed and valid

generalizations are arrived at. Facts and figures never speak for themselves. Only by

means of organizing, analyzing and interpreting the research data, their salient features,

inter-relationship, cause and connection are brought out.

Analysis of data therefore means critical examination of the data for studying the

characteristics of the object under study and for determining the patterns of relationships

among the variables relating to it using both quantitative and qualitative methods.



1. The various Logistics Services offered.

Sl. No. Service Percentage

1. Freight 11.11

2. Warehousing 33.34

3. Shipping 40.00

4. Network design 11.11

5. Other value adding services 4.44

Table 2

Services offered

11.11

33.34

40

11.11 4.44

Freight

Warehousing

Shipping

Network design

Other value adding services

Fig. 7



The pie chart above shows the service offer of the organization. The chart shows that

about 40% of the service offered belongs to Shipping and next place is for

Warehousing. Its main services is Shipping and Warehousing. Both Freight and

Network design contribute only 11 % respectively. Other service includes value

adding, which represents 4% of the sample. It includes packaging, labeling etc.



2. The brand which makes KOJ, more profitable.

Sl. No. Brands Percentage

1. Early Learning Centre 8.89

2. Mikyajy 42.22

3. Ulle popken 0

4. Nayomi 37.78

5. The Body Shop 4.44

6. List 0

7. Bebe 0

8. All of these 6.67

Table 3

Profitable Brands

8.89

42.22

0

37.78

4.44

0

0

6.67 Early Learning Centre

Mikyajy

Ulle popken

Nayomi

The Body Shop

List

Bebe

All of these

Fig. 8



According to the above pie chart, the most profitable brand in KOJ is Mikyajy followed

by Nayomi. The majority of the company’s profit is from both these brands. These brands

are KOJ’s own brands. But Ulle Popken, List and Bebe are the least performing brands.

Out of 7 major brands only 2 brands are performing well.



3. Company receives the most number of shipments/consignments from different

countries.

Sl. No. Countries Percentage

1. United States of America 0

2. United Kingdom 28.89

3. Russia 0

4. Germany 2.22

5. Italy 17.78

6. France 17.78

7. China 33.33

8. Philippines 0

9. Srilanka 0

10 All of these 0

Table 4



028.89

0

2.2217.7817.78

33.33

000

United States of America

United Kingdom

Russia

Germany

Italy

France

China

Philippines

Srilanka

All of these

Fig. 9

The pie chart above shows KOJ’s catering location in the world. Locations mentioned as

other is company catering frequently with repeat orders of customers. Around 33% of the

shipment is from China and from United Kingdom. Chart shows KOJ can enter European

markets and other favorable market is Africa. This can be looked into very seriously in

future business.



4. a) The area of activity KOJ felt the best

Sl. No. Service Percentage

1. Freight 11.11

2. Warehousing 33.34

3. Shipping 40.00

4. Network design 11.11

5. Other value adding services 4.44

Table 5

11.11

33.34

40

11.11 4.44

Freight

Warehousing

Shipping

Network design

Other value adding services

Fig. 10



The pie chart above shows the best activity which organization feels in their operations.

The pie chart shows 40% of employees in the organizations have chosen shipping in the

predominant area, followed by 33% of warehousing. Another significant area is freight

and network design with the support of 11% of employees. Most of the organizations

have a mixture of all the activities in their day to day activities bring in more revenue and

the best of their activities, which includes packaging, labeling etc.



b) The division of logistical activity earns the maximum rate of profit.

Rate

Freight 5

Warehousing 7

Shipping 8

Network Design 3

Any Other (specify)___________

1

Table 6

Rate

0123456789

Frei

ght

War

ehou

sing

Ship

ping

Netw

ork

Desi

gn

Any

Oth

er(s

peci

fy)_

____

___

___

Rate

Fig. 11



The shipping division earns the maximum profit followed by warehousing. Both shipping

and warehousing are the key functional areas in KOJ. The company concentrates more on

shipping and warehousing. The rate assigned to shipping and warehousing is 8 and 7

respectively. Network design got least rate only 3. If the company concentrates more on

freight and network design the profitability of the company will increase.



5. a) The locations to which the company caters the service.

Sl. No. Country Percentage

1. Asia 0

2. Kingdom of Saudi Arabia 44.44

3. Dubai 40

4. Quatar 4.44

5. Africa 0

6. Abu Dhabi 11.12

7. State if any other location 0

Table 7

Country

1

2

3

4

5

6

7

Fig. 12



Out of its total business about 44% is from Kingdom of Saudi Arabia and 40% from

Dubai. That is KOJ concentrates more in Gulf countries. If KOJ concentrate also in

European countries the profitability and market share will increase. The market in Asian

and European countries is vast and KOJ can easily enter into these countries.



b) Rating of the service offered by the organization.

Excellent Good Fair Poor Very Poor

Total

Ease of Service

5 8 32 0 0 45

Client handling

4 16 20 5 0 45

Customer Service

3 22 20 0 0 45

Website Information

2 25 13 5 0 45

Employee Efficiency

3 30 12 0 0 45

Table 8

0

20

40

60

80

100

120

Excellent Good Fair Poor Very Poor

Employee Efficiency

Website Information

Customer Service

Client handling

Ease of Service


Effectiveness of Logistics Management in KOJ, DubaiFig. 13

Majority of the employees is in the opinion that ease of service in the company is fair.

They also rate client handling as fair. But the company is good at customer service, for

providing website information and also in employee efficiency. The overall performance

of the company is good..



6. a) The average elapsed time between the time of receiving order from the customer to the firm to release the item from the ware house and the time the item is ready for moving from the ware house with proper documentation.

2009-10 2010-11Elapsed time 5 3

Table 9

0

1

2

3

4

5

Elapsed time

1 2

Year

Elapsed Time

Fig. 14



The above chart shows the physical verification check and average elapsed time between

order receiving and delivery of the service. Average elapsed time between order

receiving and delivery of service has an average of 3 days. In 2009-10 average time

between the time of receiving order from the customer to your firm to release the item

from the ware house and the time the item is ready for moving from the ware house with

proper documentation is 5 days and in 2010 -11 its reduced to 3 days. Even though there

is shortage of stock, it meets its demand in time. It shows the efficiency of the company.



b) Any shortage / excess of stocks noted, in the last verification done.

KOJ faces shortage of stocks. They are not able to meet demand for their products.

Every organization have to know what to buy, when to buy it and how much to buy

and also need to track your inventory--whether manually or by computer--and use

that knowledge to hone your purchasing process.

Business's basic stock should provide a reasonable assortment of products and should

be big enough to cover the normal sales demands of your business. When calculating

basic stock, consider lead time--the length of time between reordering and receiving a

product. Insufficient inventory means lost sales and costly, time-consuming back

orders. In some situations, you could even end up buying emergency inventory at

high prices.

One way to protect from such shortfalls is by building a safety margin into basic

inventory figures. To figure out the right safety margin for your business, try to think

of all the outside factors that could contribute to delays, such as suppliers who tend to

be late or goods being shipped from overseas.

Avoiding excess inventory is especially important for owners of companies with

seasonal product lines, such as clothing, home accessories, and holiday and gift items.

These products have a short "shelf life" and are hard to sell once they're no longer in

fashion.



7. a) Preference for customer complaints given by the organization.

Yes No

Percentage 84.44 15.56

Table 10

1

2

Fig. 15



The above chart shows average number of complaints. KOJ give more importance to

customer complaints. 84% of the employees supporting this argument. Hence

organization should try to reduce the complaints arising. This can be achieved by

increasing new modern methods and facilities to customers. Organization need to heavily

focus onto the issue to reduce number of complaints arising in operations, customer

satisfaction and other similar areas. In a competitive marketplace where businesses

compete for customers, customer satisfaction is seen as a key differentiator and

increasingly has become a key element of business strategy.



b) The organizations follow up to retain the customers

Sl. No. Method Rating

1 Phone Call 10

2 New Service Intimation to Customers 10

3 Gifts 3

4 Email 10

5 Fax 5

6 Other methods if any ________________ 4

Table 11

Fig. 16

SJCET School of Management, Palai

Customer Retention

0

2

4

6

8

10

12

1 2 3 4 5 6

Method

Rat

ing

Series1

59


The above chart shows preference of complaints and how organization follow up to retain

customers. There are no guarantees, but one of the best customer retention strategies is to

provide superior customer service. And that means listening to the customers. Its been

noted that cent percent of organization follow up with customers for customer

complaints. Most of the preferable methods for contacting customers for new service

intimation and customer realtionship are telephone, email and other methods like

marketing / sales, customer office visit etc. The least preferred are gifts and fax with 3

and 5 in rating. A company’s ability to attract and retain new customers, is not only

related to its product or services, but strongly related to the way it services its existing

customers and the reputation it creates within and across the marketplace.



c) Proper system of handling customer complaints?

Yes No

Percentage 100 0

Table 12

KOJ follows a proper system of handling customer complaints. The company always

tries to reduce the number of complaints. If any complaints arise it solves within a

minimum time. Listening to the voice of the customer and making process improvements

based on that feedback so that the same complaints don’t recur.

A complaint is any measure of dissatisfaction with your product or service, even if it’s

unfair, untrue, or painful to hear!

Complaints may be about:

Service Content, Delivery or Quality

Personnel

Requests

Communication

Response Time

Documentation

Billing

Follow Up



d) The system of contacting customers after completing all the formalities of an order, to enquire whether they have any complaint and to ascertain the level of satisfaction the customer enjoyed.

Yes No

Percentage 100 0

Table 13

Customer satisfaction is very important for the success of any organization. In a

competitive marketplace where businesses compete for customers, customer satisfaction

is seen as a key differentiator and increasingly has become a key element of business

strategy. Organizations need to retain existing customers while targeting non-customers.

Measuring customer satisfaction provides an indication of how successful the

organization is at providing products and/or services to the marketplace.

In KOJ they give preference to handling customer complaints. They try to reduce the

number of customer complaints. They always contact the customers and check whether

they are satisfied or not.



e) Number of customers who done business with KOJ last year. The number of

customers availed the services repeatedly. The customers who avail same

services from others (competitors) as well.

According to past records available in the Shipping section number of customers is

485 and in warehousing its 130. Shipping and Warehousing are the two major

services which help to earn more profits in KOJ. They gave preference to customer

satisfaction by providing quality services.

All the customers that is 485 in shipping and 130 in warehousing all are repeatedly

avail the services from KOJ. And also no one avail the same service from its

competitors. It shows the level of customer satisfaction in KOJ. They can easily

attract more and more customers as the existing customers are satisfied with their

services. Because satisfied customers are considered to be brand ambassador of every

organization.



CHAPTER 5

FINDINGS



FINDINGS

The quality of service as rated is above average in the case of KOJ compared

to industry. But the organization should continuously try to improve the

quality aspect as is being done by other players in the field. This is quite a

necessity as otherwise the figures may fall down. Continuous improvement is

a must so that the customers or the distributors will prefer Kamal Osman

Jamjoom LLC as their first choice in Logistics industry category. This can be

achieved with more modern equipments and proper guidance to employees

and the rating can go high to excellent service.

There is a good relation between management and employees and they are

always trying to maintain that relation.

Pricing of service is satisfactory, which organization can further enhance with

proper management. Present employee strength is satisfactory compared to

other organization but more focus should be made to documentation areas

where the firm has lesser employees compared to other organizations.

The company deals with branded and quality products so that it increases the

company’s profit and reputation.

Network Design is an area that the organization should not start immediately

due to low rate of returns is recorded as the industrial average. Design of new

warehouse areas and proper allocation of work with more sophisticated

software facility can be done through outsourced way during implementation.


Effectiveness of Logistics Management in KOJ, Dubai KOJ follows Just in Time concept or Zero warehousing concept to eliminate

waste, improve quality, improve efficiency and improve company’s Return on

Investment.

Decision making is excellent for organization and the employees done it very

well.

Operation with other logistical providers should be given more preference to

achieve cost effectiveness.

The Organization is well occupied with advanced technologies.

The management is always trying to keep environment clean and also take

quality check to meet the standard fixed.

The organization client handling, ease of service and customer service is

having remarkable difference from the industry standards. The main focus

need to be on the ease of website and employee efficiency. From the data we

can infer that areas which need to be improved are Website and employee

efficiency. Employee efficiency can be improved with a proper Human

Resource department.

Merchandise planning in KOJ is making sure the right merchandise at the

right place at the right time.

The management is always keen to appoint efficient and knowledgeable

persons.

Service offer presently has good impact with other organizations service

offers. The remarkable areas are Freight, Cross docking, and Value Adding.


Effectiveness of Logistics Management in KOJ, DubaiCompany can further enhance operations of Value Adding through proper

methods.

Tactical decisions are mostly followed by organizations followed by

operational and a few strategically.

Freight and Value Adding is considered to be the best service which

organizations offer in industry. Another major observation is about Network

Design, it has low value and no organization feels it to be lucrative area in

industry.

Organization profit is good compared to industry standards for warehousing.

This shows a difference of 2 points from industry standards. Whereas for

Cross Docking it shows same as to industry standards.

Commenting on ease of service, website and employee efficiency, the

organization needs to further improve.

The efficient methods for retaining customers are Phone, Email, Sales Agents

and least preferred methods are Fax and Gifts.

KOJ implemented consolidation of shipments from different suppliers in a

country in order to save cost and reduce delay.



CHAPTER 6

RECOMMENDATIONS



RECOMMENDATIONS

Workers Participation in Management (WPM) helps to increase the commitment

of employees towards the organization.

Organization can initiate Human Resource Department to further enhance

employee motivation. This will have favourable impact for the operational as well

as total strenghtening of organization.

Organization can further strenghten the employee strength in the documentation

department. This can lead to further rapidity for operations.

Implement new brands in the market.

Better work environment like training, clarify doubts, air conditioner, recreation

facility etc. should be provided for every class of employees.

The performance of employee should be appraised in order to formulate proper

promotional policies and also to increase the scale of salaries and wages.

Increase the number of stores in accordance with the population.

In order to attract more customers’ new advertisement strategies should be implemented

for each brand.


Effectiveness of Logistics Management in KOJ, Dubai Extend the size of warehouse in order to keep more products.

Additional funds can be allocated for the R&D activities.

Decision making is quite effective and can be followed for future operations.

Operations with other logistical providers need to be enhanced further for

operational effectiveness, more focus should be given to customer delight and

cost effectiveness.

Client handling and service need to be followed in the same way and can be

further enhanced with more support. This can be achieved by proper guiding of

employees and other workers in the logistical area.

Quality of service can be further enhanced to increase customer delight.

KOJ can enter other markets into like kuwait,Behrain,Oman etc where the

potential of market is very high for Logistics industries and can even diversify to

other areas in logistics.



CHAPTER 7

CONCLUSION



Logistics is a process which interfaces and interacts with the entire company and with

external companies, vendors, customers, carriers and more. Logistics is responsible for

the movement of products from your vendor’s right through to the delivery at your

customer's door, including moves through manufacturing facilities, warehouses, and

third-parties, such as re packagers or distributors. It is not shipping and receiving, nor is it

traffic or warehousing. It is more.

Logistics must make work effectively. This is required by the customers and, in turn, by

the company. For effective logistics, there are five key issues—

1. Movement of product.

This is often the way that logistics is viewed in many companies. Products moves should

complement the corporate strategy. If the emphasis is on cost reduction, lower

inventories, customer service or whatever, then products must move in a way that is

consistent with the emphasis. Product must also flow, not just move, from, to, between

and among vendors, manufacturing sites, warehouses and customers. If it does not flow,

then there is not a supply pipeline. Instead there are imbalances in inventories with

components and finished goods not being where they should be.The movement may be

extremely broad in geographical scope.

2.Movement of information.

It is not enough to move product and materials. We must know where they are. We must

know what inventories are where and if critical action is required. We must know what


Effectiveness of Logistics Management in KOJ, Dubaiorders are coming in and when they must be delivered. Information--timely and

accurate-- is vital for sound decision-making.The information must flow between the

company and its suppliers, carriers, forwarders, warehouses and customers. It must also

move internally among purchasing, customer service, logistics, manufacturing, sales,

marketing and accounting. And doing this goes beyond Email, faxes and phone calls.

3. Time/service.

The ability to respond to the dynamics of the global marketplace--changing forecasts,

customer requirements, new product introductions, new sourcing, and how to manage all

these changes--must be done quickly. Raw materials and components must be ordered

and arrive completely, accurately and quickly. Orders must be filled completely,

accurately and quickly. It is no longer months or weeks for lead times. It may not even be

days. Hours may decide customer service, competitiveness and value-added. Back orders

are not tolerated. If your company cannot properly respond, your customers will look for

those who can. And the more diverse the geographical scope of vendors, manufacturing,

warehouses and customers, the more critical is time. Distance means time. Yet time

delays are not acceptable. Movement of product and movement of information show their

impact here.

4. Cost:

Cost is the key measure by which logistics effectiveness is often measured. Freight,

warehouse labor, public warehouse charges and other items on the P&L. Or inventory, a

balance sheet item. Cost control, containment, and management is important for

corporate profitability. Fiscal stewardship is a duty of all managers. The highest price

does not mean the best service, and it may not be the service you need. Nor does the

lowest price necessarily meet your needs.

Cost has a relation to service. They go hand in hand. As you define your service against

your costs or costs against service, the give and take develops into your operating costs

and budgets. Then you have to make sure that the cost can be managed. Otherwise costs

can go out of control, or seem to.Air freight is quoted in the currency of the origin


Effectiveness of Logistics Management in KOJ, Dubaicountry. Ocean terminal and other accessorial origin charges are also in origin country

currency. Warehouses in other countries will invoice in origin currencies.

5. Integration .

Within the company, between company and their customers and between company and

thier vendors. Integration--bringing it all together--within the company is vital. Logistics

is a process. Effectiveness requires that each relevant element of the organization do its

part. However there is a problem with doing this. The company must share their logistics

vision and plan with them. This sharing and understanding will better enable them to

cooperate with and assist . They may be able to offer ideas and gain sharing to further

improve the logistics effectiveness and the key issues with it.

Integration with customers is important. Logistics is a process which runs from the

vendor's door through to the customer's. It interacts with almost every group within the

company and with many companies outside the company, including its customers.

Effective logistics revolves around five key issues--movement of product, movement of

information, time/service, cost and integration. Each of this is critical to the success of

logistics and to creating value-added to the company and improving competiveness.

The universe everyday is witnessing unimaginable growth in majority of the industries.

The logistics and freight industry is one such industry that is rapidly growing. Worldwide

logistics industry is distinguished by fast technological advances and is growing rapidly

than most other industries over the past years. With stiff competition around, the

company is likely to reduce the profitability but with proper management of operations

and by proper customer desired services and also effectively utilizing its alliances it can

maintain and improve the performance. Joint operational ventures for developing the

customized services for its steady growth. The organization has enormous opportunities

to grow beyond the expectations.

Conclusion

By doing this research, I am concluding that Kamal Osman Jamjoom, one of the

leading retailers in the Middle East is taking forward their logistics department in

the most efficient way resulting in cost effective modes and distribution of their


Effectiveness of Logistics Management in KOJ, Dubaibrands to their respective regions and stores. Employees are treated professionally

which is motivating them their by resulting in increase in productivity.



BIBLIOGRAPHY

Logistics and supply chain management , cases and concepts-by G Raghuram, N Rang raj

Logistics Management An Australian framework - by peter Gilmour

Building competitive operations planning and logistics -by APICS ,Association of Operations Management

Operations Management -by Norman Gaither, and Greg Frazier

The geography of logistics, Logistics management distribution report- by Gooley T B

Strategic Management an integrated approach-by Charles w Hill and Gareth r Jones

WEBSITES

http://www.kojhr.com

http://www.kojamjoom.ae/

http://en.wikipedia.org/wiki/Kamal_Osman_Jamjoom

http://www.youtube.com/watch?v=SKU7Qq0RJj0

http://www.kojfranchise.com/

www.wikipedia.com

INTERVIEWS

With Anil Alex, Logistics Manager (UAE &GULF).

With Edwin Cenedoza, Asst.Warehouse Manager.

With Shanmugham Sasikumar, Supply & Distribution Supervisor.


http://www.kojfranchise.com/

http://www.youtube.com/watch?v=SKU7Qq0RJj0

http://en.wikipedia.org/wiki/Kamal_Osman_Jamjoom

http://www.kojamjoom.ae/

http://www.kojhr.com/


ANNEXURE-1


Body

Documents

business logistics logistics

departments of logistics

logistics activities

importance of logistics

field of logistics management

integrated logistics

production logistics

goal of logistics work