CG-PPI internship report

7/27/2019 CG-PPI internship report

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Inventory Management

.By Narendra Chhetri


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About the Company

CG-PPI Adhesive Products Limited is a Joint Venture between CromptonGreaves Limited and PPI Adhesive Products Limited, Republic of Ireland, for

the Manufacture of Special Purpose Self Adhesive Tapes for Electrical,

Electronics, Paper Industry, Shoe Industry, Picture Tube, Automobile and

other specialty applications.

The Factory is located at Kundaim Industrial Estate Goa, which isapproximately 17 kms from Panaji, the Capital of Goa. Kundaim Industrial

Estate is one of the largest Industrial Estates in Goa and has zero pollution

and uninterrupted power supply

The factory has excellent State-of-the-Art Plant and Machinery. Employeesare trained to achieve zero defects to meet the stringent requirements of the

customers in various segments.


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History

CG-PPI Adhesive Products Limited is a Joint Venture between Crompton

Greaves Limited and PPI Adhesive Products Limited, Republic of Ireland, forthe manufacture of Special Purpose Self Adhesive Tapes for Electrical,

Electronics, and other specialty applications including printed tapes,

precision die cut component and labels.

CG is a USD 2 billion engineering conglomerate with an impressive anddiverse portfolio of products, solutions and services ranging from high-end

power and industrial equipments and solutions, to consumer products and

home appliances, addressing myriad needs. Enjoying a reputation of stature

for over seven decades, CG, which originates in India, has transformed itself

into a global corporation.

PPI Adhesive Products Ltd was originally established in 1970 and

commenced production at Waterford Industrial Estate in 1971. The company,

which is owned and managed by its Irish board of directors, produces a very

extensive and sophisticated range of technical self-adhesive tapes for a wide

range of applications.


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Vision and Mission

VISION

To be one of the globally admired company of choice for

Adhesive, Non-Adhesive Tapes, Labels & Packaging

Materials.

MISSION

To Create Superior value in the products and services we

provide to our Customers. Our Adhesive, Non-adhesiveTapes and Labels will carry the image of Innovation,

Satisfaction, State of Art, Trust, respect and value for

money.


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Quality Policy

The Quality Policy of CG-PPI is to understand the customer requirements &

is flexible to the changing needs of the customers resulting in a Win-Winrelationship.

The Company adopts innovative methods to provide cost effective & quality

products with timely deliveries & services.

The Company continuously motivates its employees to upgrade their skills to

attain customer satisfaction.

The Quality Policy of CG-PPI is a process of continual improvement in all

functions of the organization.


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Products

CG 786 FLEXOMOUNT TAPE

KAPTON/NOMEX TAPES

Glass Cloth Tapes

FPF, NPN, NKN Laminates


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Cont

Metal Foil Tapes

Tapes for Shoe Upper & Leather Industries

Polyester Electrical Self AdhesiveTape


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Introduction of Inventory Management

Inventories are playing vital role in every businesswhether industrial unit are trading organization.

Inventories are very broad term and include the elementswhose values are always very high, in any industrial unit

Inventory constitutes major parts, approximately 40% to80% of gross working capital depending upon the natureand size if the industrial unit

Inventory can be any form which consists of raw material,consumables, and spares, work in process, finishedgoods.


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Objectives of Research/Project

PRIMARY OBJECTIVEThe objective is to optimize the investment in inventories by excisingselective Inventory control techniques

SECONDARY OBJECTIVE

1. To study and analyze the performance of inventory management ofCG-PPI Adhesive Products Limited

2. To review the system of inventory model and reorder level of raw material.

3. To find out the economic order quantity for Printing Raw Material and

consumables.4. To determine the optimum level of safety stock for Printing Raw Materialand Consumables and to fix reorder point.


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Collection of Data

COLLECTION OF PRIMARY DATA

a) Approaches various functional heads in charge of purchase,

production, finance and Stores and collected related information for the

study

b) Physical inspection of stores and stock levels

COLLECTION OF SECONDARY DATA

1) Data for the previous year was obtained from the records of the

company.

2)The stores ofCG-PPI Adhesive Products Limited consists various

inventories of raw materials, consumables, spares packing material etc.

the range of inventories are wide and consists about more than hundred

items. The elements were selected after considering its usage value,

importance and contribution towards production.


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Operating Cycle CG-PPI Adhesive Products Limited

Debtors

Cash

RawMaterial

Work InProcess

FinishedGoods

126 days


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RATIO ANALYSIS

Ratios 2010-11 (in

times)In days 2010-

20112011-12(in

times)In days 2011-

2012Inventory

turnover ratio

11.33 32.21 11.5 31.73

Material

turnover

ratio

14.48 25.20 19.73 18.49

Work in processturnover ratio

18.8 19.41 19.73 18.49


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ECONOMIC ORDER QUANTITY

Item No. ItemDescription

Item Code EOQ

No. of Orderper year

1 Polymide Film1 MIL / 25 MIC

11027 490 7

2 Toluene 13002 852 133 Silicon Resin

PSA 59512031 952 14

4 Cotton Fabric 11289 448 665 Adicryl AP 505 XXX020 952 14.2


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Reorder Level For Raw Materials Printing

S. No. Item Name Calculations ROL1 Polyester Film 25 MIC (15/30*1400)+700 700 KGS2 Fiber Glass Fabric 461 S (20/30*3500)+1167 3500 MTS3 Natural RubberPLC II (20/30*5000)+167 500 KGS4 Escorez 1204 (15/30*800)+400 800 KGS5 Adcryl AP 505 (15/30*1000)+1000 833.33 KGS


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PROCESS OF INVENTORY MANAGEMET

The Inventory Process is fully Computerized methodand less paper work.

The first step of computerized method is

1) Releasing a Purchase Order No.

2) Receiving of a Materials.3) Issuing of Materials

4) Return Back Materials from Manufacturing Units

5) Rejected Materials


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ABC Analysis

ABC analysis classifies inventory items in threecategories based on their values. Always better

control is its real meaning. Items of high value but

small in number are classified as A item, which

would be under a strict control.

Company classify the material under ABC analysis.


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Findings Company is incurring more expenditure on inventory because of holding high level of stock.

Working capital blocked in the inventory for 31 days (one month) which is a quite healthy sign

for an organization. Perfect inventory levels are good for the company because they represent

an investment is medium. It also rises the company up to height should price begin to rise.

Safety stock should be increased in case of Polyester Film 25 MIC, Fiber Glass Fabric 461 S,

Natural RubberPLC II, Escorez 1204 and Adcryl AP 505 because average consumption andsafety stock is half of monthly consumption.

Modern inventory control techniques are followed by the company.

Item Fiber Glass Fabric 461 S and Natural Rubber needs close control with regards to

replenishing and its lead time is longer and quantity required is more per month.

In respect to material turnover, holding of inventory has been decreased from 25 days to 18

days. It is very good sign for the company because there is an optimum investment in

inventory


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Suggestion It may suggest that proper reorder level for consumables and raw materials printing

may be maintained so that, the company can prevents the over stock or stock outlevel.

As it was understood from the study that the company maintaining safety stockwhich is not adequate to certain materials. So to avoid stock out the safety stockmay be maintained at optimum level.

To reduce the inventory cost such as carrying cost, ordering cost it is suggested thatthe company can apply EOQ model to all the materials, consumables and tools tothe extent possible.

The reorder level should be placed at the right time, based on the raw materialavailability in the store.

In order to reduce the expenditure and to maintain inventories at optimum level, itis necessary to implement proper planning, budgeting and coordination among allfunctional departments.


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The review can be made to all the material available in the store to avoid the

unnecessary dumping of materials, so the company can save the storage cost

and space.

The production department may introduce the new technique called vendor

quality management to ensure the standardized quality in the finished

product. The concept is adopted in all leading companies.

To reduce the lead time and to save ordering cost it may be suggested to

localize certain important items instead of importing from other country.

This will give a chance for increasing employment opportunities to our

people.


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Learning's

GRN method Releasing a Purchase Order No.

I learnt other method through Inventory Management

Project

ABC Analysis in Company


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Conclusion

Inventory control means the availability of right materials of right

quantities coordinated with lead time. Each and every component ofinventory is important and managing the inventories to keep in an

optimum level is a must.

Being a tape industry CGPPI is facing a stiff competition in the

market.

Since inventory is the major part of their cost of production there is a

need for inventory control by way of reducing cost and optimum

utilization of materials.

Though the company is having certain policies regarding this, still it

requires through study of their policy and systems to some extent to

understand the inventory management.

CG-PPI internship report

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