rprt

ORGANISATION STUDY

CHAPTER-1

INTRODUCTION

KERAFED registered in the year 1987 as an apex

body in the co-operative sector is to implement an integrated coconut production,

procurement, processing and marketing project, funded by European Economic

Community and National Co- Operative Development Corporation with a financial

component contributed by the State Government of Kerala, to protect the interests of

the growers, it was in 1993 that the federation started commercial production.

Kerafed is one of the largest coconut oil producers in India. The first plant of

Kerafed’s coconut oil opened at Karunagapally in Kollam district is one of the biggest

such units in India. KERAFED has another plant at Naduvanoor. Now the plant is

functioning with the most modern machines in most hygienic atmosphere.

Kera in Malayalam language means coconut and hence the land of

Kera came to be known as Kerala. The coconut liquid provides food and drinks; the

shell provides domestic utensils and fiber, the leaves provide plaiting, coir is used for

flooring. No other single plant in the world has as many uses as the coconut. Kerafed

is the single largest procurer of coconut/copra, produced in Kerala.

The organization study undertaken as a part of the curriculum was

done at “The Kerala Kera Karshaka Sahakarana Federation Ltd “(KERAFED)

Thiruvananthapuram. This study helps me to learn how effectively and efficiently

manage the industry/organization. The main aim of the study is to understand the

various departments and functions of the organization

1

ORGANISATION STUDY

OBJECTIVES OF THE STUDY

To understand the company’s function.

To know about the various products and services of the organization.

To know about the various department.

To analyze the organization structure.

To identify and evaluate the strengths, weakness, opportunities and threats

faced by the organization.

To understand the future programmers of the company

To interact with the employees at various levels of the organization in order to

understand their grievances.

SCOPE OF THE STUDY

The scope of the study is to know the overall performance of the

organization. It also provides a chance to see the practical constraints faced by

the managers while putting theory into practice.

SIGNIFICANCE OF THE STUDY

This study aim together information on all the departments of

Kerafed ltd. Thus study will enable in getting a partial exposure to the day today

working of an organization.

METHODOLOGY

The methodology adopted for this report through the collection of

primary and secondary data

Primary data

Data collected by the researcher from the actual site of

occurrence of events are called primary data. Primary data is obtained through

observation or through direct communication with respondents in one form or another

or through personal interviews. The primary data for the study obtained from:

2

ORGANISATION STUDY

Formal interview with the staffs

Formal interview with the workers of the organization

Formal interview with the managers and the departmental heads

Secondary data

Secondary data are those data which are already

collected by someone else and which are already been passed through statistical

process. The secondary data for the study obtained from:

From previous research reports

Government publications

Company records

Text books

Annual reports

Internet

www.kerafed.com

LIMITATIONS OF THE STUDY

Certain information’s are collected through the face to face interview with

the employees, so there is a chance to biasing.

Due to their busy schedule the departmental heads restricted the

collection of detailed information.

This study was conducted within a short period, so it is not possible to

study all the aspects in detail. The detailed report of the all aspects is not

much possible.

Due to the onam season the demand of coconut oil has raised so; all the

employees are very busy in their works, so I cannot conduct a deep study

of the coconut oil complex of Kerafed at Karunagapally, Kollam district.

3

ORGANISATION STUDY

CHAPTER -2

INDUSTRY PROFILE

Coconut is the most useful tree crop ever grown in the world. It is

termed as horticulture crop, food crop and even as an oil seed. Coconut oil

has a unique role in the diet and is an important psychological functional

food. The health and nutritional benefits that can be dserived from consuming

coconut oil have been recognized in many parts of the world for centuries. It

is been scientifically proved that coconut oil doesn’t have any toxic

substances

Coconuts are part of the daily diet of many people. Its endosperm is known

as the edible "flesh" of the coconut; when dried it is called copra.

The oil and milk derived from it are commonly used in cooking and frying;

coconut oil is also widely used in soaps and cosmetics. The clear

liquid coconut water within is a refreshing drink and can be processed to

create alcohol. The husks and leaves can be used as material to make a

variety of products for furnishing and decorating. It also has cultural and

religious significance in many societies that use it.

Now people are definitely switching to coconut oil exclusively

for all their cooking needs. Coconuts play a unique role in the diet

of mankind because they are the source of important physiologically

functional components which are found in the fat part of whole coconut.

Coconut oil is also known as coconut butter, is tropical oil extracted

from copra (the dried inner flesh of coconut) with many applications. It

constitutes 7% of total export income of the Philippines, the world’s largest

exporter of the product. In recent years India has attained top position

in production of coconut, overtaking.

4

ORGANISATION STUDY

COCONUT INDUSTRY IN INDIA

India has recently achieved the distinction of being the highest producer

of coconuts in the world, having overtaken the next highest producer, the Philippine

Islands. However the average coconuts produced per palm in this country is dismal,

standing at about 46 nuts per palm per year in 2006-07 compared to 30 nuts per palm

in 1950-51.

Coconut is being cultivated in an area of over 1.94 million hectares in

India. The estimated requirement of coconut seedlings in the country is in the region

of 30 million per annum. About 90% of the coconut growing area is situated in the

four southern states of India, with Kerala occupying about 50% of coconut cultivated

area in India.

Global trade is reaching towns and cities across continents and in the

most remote places. Due to the changes in progress and development, there is a need

for seeking out products that give added value and save time and effort. Packaged

Tender Coconut Water is available outside hospitals today. The ubiquitous vendor of

tender coconuts is almost on every street.

Coconut products:

1. Raw Kernel

2. Copra

3. Coconut oil

4. Tender coconut water

5. Coconut cake

6. Coconut toddy

7. Coconut shell based products

8. Coconut wood based products

9. Coconut leaves

10. Coir pith

5

ORGANISATION STUDY

NAFED

National Agricultural Cooperative Marketing Federation of India Ltd.

(NAFED) was established on the auspicious day of Gandhi Jayanti on 2nd October

1958. Nafed is registered under the Multi State Co-operative Societies Act. Nafed was

setup with the object to promote Co-operative marketing of Agricultural Produce to

benefit the farmers. Agricultural farmers are the main members of Nafed, who have

the authority to say in the form of members of the General Body in the working of

Nafed.

Objectives

To facilitate, coordinate and promote the marketing and trading activities of the

cooperative institutions in agricultural and other commodities, articles and

goods

To undertake or promote on its own or on behalf of its member Institutions or

the Government or Government Organizations, Inter-State and international

trade and commerce and undertake, wherever necessary, sale, purchase, import,

export and distribution of agricultural commodities, horticultural and forest

produce, other articles and goods from various sources for pursuing its business

activities and to act as the agency for canalization of export and import and

interstate trade of agricultural and other commodities or articles under any

scheme formulated by the Government of India or other Government agencies

and to facilitate these activities, wherever necessary, to open branches/sub-

offices and appoint agents at any place within the country or abroad;

To undertake purchase, sale and supply of agricultural products, marketing and

processing requisites, such as manure, seeds, fertiliser, agricultural implements

and machinery, packing machinery, construction requisites, processing

machinery for agricultural commodities, forest produce, dairy, wool and other

animal products;

6

ORGANISATION STUDY

To act as warehouseman under the Warehousing Act and own and construct its

own go downs and cold storages;

To act as agent of any Government agency or cooperative institution, for the

purchase, sale, storage and distribution of agricultural, horticultural, forest and

animal husbandry produce, wool, agricultural requisites and other consumer

goods;

To act as insurance agent and to undertake all such work which is incidental to

the same;

to act as insurance agent and to undertake all such work which is incidental to

the same;

To organise consultancy work in various fields for the benefit of the

cooperative institutions in general and for its members in particular;

To undertake manufacture of agricultural machinery and implements,

processing, packing, etc. and other production requisites and consumer articles

by setting up manufacturing units either directly or in collaboration or as a

joint venture with any other agency, including import and distribution of

spare-parts and components to up-keep of the machinery/implements;

To set up storage units for storing various commodities and goods, by itself or

in collaboration with any other agency in India or abroad;

To maintain transport units of its own or in collaboration with any other

organisation in India or abroad for movement of goods on land, sea, air etc.;

7

ORGANISATION STUDY

COMPANY PROFILE

KERAFED is the Apex Co-operative Federation of coconut farmers in

Kerala and is the largest producer of coconut oil in India. KERAFED's

coconut oil complex at Karunagapally in Kollam district is one of the biggest

such units in India, with a capacity of 200 Tons per day.  

"KERA" Brand of coconut oil is produced by kerafed from copra of the

finest quality, directly procured from coconut growers in Kerala - the land of

coconuts. The copra thus procured is processed using the most modern

technology. In the selection and processing of copra, KERAFED employs

strict quality control measures to ensure product superiority and purity. A

unique two stage filtering process is employed by KERAFED to retain the

original aroma and flavour of coconut oil for a long period. 

"KERA" Brand of coconut oil is known for its quality, purity, longer shelf

life and reasonable price. Its quality is conformity with the grade

specifications laid down by the Bureau of Indian Standards vide IS:542-

1968. Certificate of Authorisation to grade "KERA" coconut oil under

AGMARK has also been obtained. "KERA" is available in HDPE bottles of

100 ml, 200 ml and 500 ml; PET bottles of 1000 ml and polythene pouches

of 500 ml and 1000 ml. The raw materials used for these packings are of

virgin / food grade, approved by CFTRI, Mysore / other Government

approved agencies. Secondary packing is done using 3/5 ply corrugated

cartons, as per specification

8

ORGANISATION STUDY

VISION AND MISSION OF KERAFED

MOTTO

To get the support of coconut farmers.

Distributing and providing healthy coconut oil to consumers

VISION

Being the leader of best quality coconut oil it has a vision to provide best

value to the coconut farmers healthy oil to the consumers

MISSION

Business

Customer relation

Innovation

Social sector

OBJECTIVES OF KERAFED

To reduce edible oil imports.

To provide an impulse effect on internal production of coconut.

To develop the agricultural potential of Kerala state.

To strengthen the co-operative movement.

To secure the marketing of coconut and its by-products, thereby assuring

economic prices to the growers.

To undertake research and development activities on production, processing

and marketing.

For effectively and efficiently carrying out the administrative and

operational practices on a day to day basis, the state is divided in to three regions, the

central region, the northern region, and southern region. The southern region consist

of the revenue districts – Thiruvnanthapuram, Kollam, Pathanamthitta, and Alapuzha,

9

ORGANISATION STUDY

the northern region consists of Malapuram, Kozhikode, Waynad, Kannur and

Kasargode districts and the central region consists of Kottayam, Idukki, Ernakulam,

Thrissur, Palaghat districts, 3300 primary agriculture credit societies in each region

are members of the federation to undertake production procurement, marketing

activities at the farmer’s level.

FARMER FRIENDLY ORGANIZATION

Kerafed has  been  offering  farmers attractive  support  prices  for  coconut and copra

during unfavorable  market  conditions,  procuring   copra   under   the   price  

support  scheme  on  behalf of NAFED, Government  of  India  and  rendering  value 

added  services  to  enhance  their  earnings  through   improved   productivity,  and  

by assisting  them  in production and procurement. Kerafed also provide periodic

extension activities to help farmer like

demonstration farms, training camps, exhibitions, seminars and publication and

distribution of bulletins and literature on coconut farming.

10

ORGANISATION STUDY

PRODUCT PROFILE

11

MEMBERS OF THE FEDERATION

1 GOVERNMENT OF

KERALA

1

2 KERALA STATE

COOPERATIVE

AGRICULTURAL

1

3 KERALA STATE

COOPERATIVE

AGRICULTURAL

DEVELOPMENT BANK

LTD

1

4 DISTRICT COOPERATIVE

BANK LTD

9

5 PRIMARY COOPERATIVE

AGRICULTURAL BANK

25

6 PRIMARY

AGRICULTURAL

COOPERATIVE CREDIT

SOCIETIES

900

7 MARKETING SOCIETIES 4

ORGANISATION STUDY

“KERA” Brand of coconut oil is KERAFED from copra of the finest

directly procured from coconut growers in Kerala – “the land of coconuts”. The copra

thus procured is processed using the most modern technology. In the selection and

processing copra, KERAFED employs strict quality measures to ensure product

superiority and purity. A unique two stage filtering process is employed by

KERAFED to retain the original flavor of coconut oil for a long period.

KERA" Brand of coconut oil is known for its quality, purity, longer

shelf life and reasonable price. Its quality is conformity with the grade specifications

laid down by the Bureau of Indian Standards vide IS:542-1968. Certificate of

Authorization to grade "KERA" coconut oil under AGMARK has also been obtained.

"KERA" is available in HDPE bottles of 100 ml, 200 ml and 500 ml; PET bottles of

1000 ml and polythene pouches of 500 ml and 1000 ml. The raw materials used for

these pickings are of virgin / food grade, approved by CFTRI, Mysore / other

Government approved agencies. Secondary packing is done using 3/5 ply corrugated

cartons, as per specifications.  

Apart from meeting the marketing needs in Kerala, Tamil Nadu,

Karnataka, and Andra Pradesh etc, they are planning to popularize the brand in cities

like New Delhi, Bangalore, Mumbai, and Kolkata. KERA has gone globally with

export to Middle East countries. KERAFED had tie up with a leading retail chain in

Dubai and Abu Dhabi for the two brands, cooking oil ‘kera’ and hair oil ‘kera kesh’.

KERA is proud to be patronized by millions as the tastiest of all

cooking mediums and the smell of yore, KERA enjoys an undisputed popularity of

the market share in kerala –a feat achieved by ultimate customer satisfaction.

Kerafed at a glimpse:

Integrated development of coconut and coconut products.

Copra selection as per BIS parameters for processing

Most sophisticated processing facilities

Quality control laboratory with AGMARK guarantee.

By far the largest coconut oil mill in India

12

ORGANISATION STUDY

Storage capacity of 2100 tons per day

A predominant share of the market in Kerala is enjoyed by

Kera, the year at economical rates.

Safeguards the interests of over 29 lakhs coconut farmers in

Kerala.

PRODUCTS

The various products of the KERAFED are as follows:

KERA

It is the brand name of the coconut oil produced by Kerafed from copra of

finest quality, direct produced from coconut growers. Copra is produced by the use of

most modern technology. Double filtering process is used by Kerafed to retain its

quality and flavor of coconut oil for a long period.

KERA KESH

In addition to production of edible coconut oil, the production and sale of

ayurvedic hair oil manufactured by Kerafed. This is available in 100ml pack.

KERA GOLD

This is an export quality of kerafed. The export is mainly to the gulf

countries. It is available in 500ml, 200ml, and 100ml pack.

KERA POPULAR & AGMARK

There are two important product of kerafed. KERA AGMARK can be getting

in one litter pack and KERA POPULAR is available in 5kg, 500ml, 100ml, and

pouches.

COPRA CAKE

13

ORGANISATION STUDY

This is the cake from the oil extraction process. The sale of cake is made to

a person who quotes highest price. This is sold in sacks bags.

Top ten coconut producers — 19 December 2009

Country Production (tonnes)

 Philippines 19,500,000

 Indonesia 15,319,500

 India 10,894,000

 Brazil 2,759,044

 Sri Lanka 2,200,000

 Thailand 1,721,640

 Mexico 1,246,400

 Vietnam 1,086,000

 Papua New Guinea 677,000

 Malaysia 555,120

 Tanzania 370,000

ORGANIZATION CHAR ORGANIZATION CHART

14

ORGANISATION STUDY

15

MANAGING DIRECTOR

ADMINISTRATIVE OFFICER

DIRECTOR (PROJECTS) DIRECTOR

(ADMNISTRATIONS)DIRECTOR

(MARKETING)

DIRECTOR (PRODUCTION)

PROJECT MANAGER

PLANT MANAGER

MANAGER (ADMN)

MANAGER (FINANCE)

MANAGER

ASSISTANT MANAGER

ASSISTANT MANAGER

ASSISTANT MANAGER

ASSISTANT MANAGER

ANALYST OFFICE MANAGER

OFFICE MANAGER

SHIFT IN CHARGE

ACCOUNTANTASSISTANTOPERATORWORKERS

TYPIST TYPIST

ASSISTANT

OFFICE MANAGER

ASSISTANT MANAGER

ATTENDER

ATTENDER

ATTENDER

ORGANISATION STUDY

CHAPTER-3

DEPARTMENT ANALYSES

ORGANISATION STRUCTURE:

Organization structure is the systematic arrangement of the people

working for the organization to achieve preferred goals. The structure has two

dimensions, -horizontal and vertical. The horizontal dimension indicates the

departments and vertical dimensions indicate hierarchy.

Board of management elected by members of the federation is headed by a chairman.

From those members an executive committee and a chairman are elected. The

federation has to get the approval from the board before implementing major decision.

Managing director appointed by the government of Kerala is the supreme authority of

the federation, normally an outside person. Director is the top of the organization

hierarchy among the employees of the organization.

THE DEPARTMENTS IN KERAFED ARE:

1. Administrative department

2. Finance department

3. Marketing department

4. Production department

16

ORGANISATION STUDY

ADMINISTRATIVE DEPARTMENT

In KERAFED, administrative department is responsible for general and personnel

administration officer is the head of the department. Administration involves the

formulation of overall policies and objectives. In KERAFED the administrative

department is just like H.R department commonly seen in other organization.

The functions of administrative department include:

Personal and general administration

Keeping and measuring the confidential report of each employee for the

purpose s like promo9tion, fringe benefits, training etc

To maintaining the relationship with workers and organization.

Administrative function includes attendance, monitoring, recording, and

controlling absenteeism etc.

Other functions like providing canteen services, ESL, provident fund accident

benefits.

To provide better work atmosphere to the employees.

RECRUITMENT

To search for prospective employees and stimulating them to apply for job in

the organization. Recruitment aims to develop and maintain adequate manpower

resource upon which an organization can depend.

Employees are recruited through:-

1. The Kerala state public service commission

2. By deputation from other department

3. Through direct recruitment by the board.

4. On contract basis.

The main source of recruitment and selection of employees in the

organization is Kerala public service commission (KPSE). The present employee

17

ORGANISATION STUDY

strength is 242 (includes permanent and casual workers). At present kerafed have 87

permanent workers, 5 deputationists, and one contract labor. In addition to this 16

persons are engaged on daily waged basis and 149 persons are employed as casual

workers in karunagapally other plants.

TRAINING AND DEVELOPMENT

They provide good training facility for their workers. They also provide computer

training facility for their staffs and employees. Training is the systematic programme

of the organization which aims at increasing the attitudes, skills and abilities of the

workers to perform a particular job. Developments are concerned with growth of

employees in all respects.

EMPLOYEE COMPENSATION

KERAFED employee compensation structure contains:

1. Special allowances

2. House allowances

3. Dearness allowances

4. Basic salary

Medical scheme is also available for the workers and gratuity is

given in collaboration with LIC, in addition to this plan workers and staffs are getting

one day leave as compensation and ESI.

18

ORGANISATION STUDY

TRADE UNIONS

Trade unions are voluntary organization of employers and employees

formed to protect and promote their interests through collective action. Their presence

is felt in all activities of an organization.

In KERAFED there are two trade unions for employees:

1. Kerafed staff association.

2. Kerafed employee’s organization.

Trade unions such as CITU, AITUC, INTUC, BMS etc are function in KERAFEDs

plants.

FINANCE DEPARTMENT

Finance is the foundation stone of every business in the present day set up.

The success of every business depends upon adequate source of finance. Hence the

statement “Finance is the life blood of any business enterprise in every walk of life”.

So in any organization the most important department is finance department.

A well managed financial or working capitals are to be at vry considerable

extent, determined by its financial policies, both past and present,. Department is the

strength of the business enterprise. In KERAFED finance department is headed by

finance manager responsible for all the business transaction, procurement and

allocation of funds are the, major function of finance department. A firm success and

even survival, its ability and willingness to maintain production and investment is

fixed.

19

ORGANISATION STUDY

FUNCTIONS OF FINANCE DEPARTMENT

The major functions of the finance department are:-

1. Accounting

2. Auditing

- Internal auditing

- Statutory auditing

- Government Auditing

3. Release the payments and collecting receipts from contract with

outsiders.

4. Information management

5. Budgeting

MEMBERSHIP AND SHARE CAPITAL

In the commencement of the year there were 941 members holding 57562

shares worth Rs.287820000/- this includes 55117 share invested by govt of kerala and

NCDC worth Rs.27558500.

BORROWINGS

The amount outstanding at the begening of the year under borrowings from

NCDC and govt of kerala was 258797800/- and the same amount is outstanding at

the end of the year.

20

ORGANISATION STUDY

WORKING CAPITAL

In KERAFED, at the end of the year working capital arrived at Rs.

273461673.72

SOURCE OF FUNDS

The main sources of funds of KERAFED are:-

Share capital contribution of govt of Kerala.

Share capital contribution by cooperative institutions

Loans from NCDC, cooperative banks and govt of Kerala.

Grants and subsidies.

These funds are employed for the procurement of copra, marketing expenses and

administrative expenses etc.

Grant and share capital were the primary elements of the capital structure of

the federation. It includes:

21

ORGANISATION STUDY

The major investment decision requires approval of board of management. If there is

an opportunity for investment, the proposal is put before the board of management. A

committee from the board of management investigates the viability of the project and

their findings are put before the board. The board gives approval for the project, only

if it is found as viable. During the last few years the federation was in loss.

An annual report, prepared by the account section and audited by an

external auditor, is submitted to the registrar of cooperative societies.

The price of the product is prepared on the basis of “mark-up’ pricing

method. A 10% of profit is added per unit cost of the product. From this 10%, 12%

commission is given to the suppliers and retailers.

22

6%5%

20%

60%

Share capital provided by members societiesGovernment contributionNCDC grantEEC grant

CAPITAL

STRUCTURE

PERCENTAGE

EEC Grant 60%

NCDC Grant 20%

Government contributions 5%

Share capital provided by member

societies

5%

ORGANISATION STUDY

For ex: Unit cost of the product is determined by the market price of the copra and the

production and administration expenses. If the price of copra varies, the per unit cost

also varies. Then the price of the product is adjusted according to the marketing price

of the copra.

Normally the suppliers are given a 20 days credit period. The credit period

is as per bank guarantee and the past performance. If the supplier fails to meet the

obligation within the stipulated period, the federation collects the amount from the

bank.

The various sections working with the finance department are:

Budgeting

Commercial accounts

Bill passing

Cash

Works

One of the primary functions of finance department is maintaining the

books of accounts, in this process extensive use of computers are employed for the

purpose of feasibility and accuracy. The trial balance is prepared on this basis of the

various ledger folios and other transaction details and then profit and loss account and

balance sheet is prepared based on trial balance.

Budgeting

Budgeting is one of the other vital activities undertaken by the

department. The budgeting process involves prediction of future sales and the

preparation of estimates based on that sales. Dates such as future sales are

provided by the marketing department on the basis of past sales details and

current market conditions. The future production, labor, cash, and other

resource requirements are defined in the budget.

Commercial accountants

23

ORGANISATION STUDY

The process of internal auditing is conducted by cooperative wing

auditor assisted by the finance department and statutory audit by an professional

charted accounted. The finance department of Kerafed conducts inspection of

concerned transaction details of primary cooperative societies.

Cash section

Salaries and wages of the employees are prepared in this section. The

cash section deals with the payment and receipt of cash. The payment

exceeding Rs. 20000 will be in cheques.

MARKETING DEPARTMET

Marketing is the wide range of activities involved in making sure that the

company is continuing to meet the needs of their customers and are getting

appropriate value in return. It is concerned with promoting the company’s

product and services in the market for achieving maximum sales. KERAFED

has an aggressive marketing strategy. In an resent survey the brand KERA has

bagged second position in Kerala after milma. So the company is not investing

much in promoting their product.

The marketing department consists of a manager, below

him comes the assistant manager, senior assistant and assistant, below him

comes the assistant manager, senior assistant and assistant, below him comes

typist and attender.

Advertising campaign was handled by STRAK

communications Trivandrum. The federation has reduced the quantum of

advertisement. Television and print media is the main media to communicate

with the customers. And now a day they are more concentrating on exhibition

s as promotion. In most of the triveni and supplyco stores KERA coconut oil is

selling like a hot cake because all people are buying product from these stores

at less costs during the festival seasons like Onam, Ramzan etc.

KERA has a good distribution channel, reaching each and

every taluk in Kerala. With most extensive procurement channels, most

24

ORGANISATION STUDY

modern processing facilities and a massive storage capacity of 2100 tones with

stock points in prominent cities in Kerala helps the federation to ensure

availability of KERA to each and every consumers.

KERA is currently part of the biggest retail network-

CSD, ministry of defence, oil seed cooperation like Karnataka oil federation;

Tamil Nadu cooperative growers federation (TANCOF) and oil federation of

Madhya Pradesh will soon be complimenting the already existing marketing

and sales channels of a KERA, in their respective states.

The sales turnover of KERA brand coconut oil is marked

a steady increase during the past few years. In order to increase the sales

turnover the federation has decided to convert Mobile team officers in to field

offices and posted permanent staff instead of personnel on contracts and

deputation. Because of these change a steady progress is seen in both in the

procurement of copra as well as sale of Kera oil.

Functions of Marketing Department

To find new markets.

Deciding pricing strategies

Strengthening the agency network

Appointment of agencies

Forecasting the demand

Creating awareness

Collection of payments

Grievance redressal of customers

Keeping the relevant information and exchanging with other department

Objectives of Marketing Department

The main objectives of marketing department in KERAFED are:

25

ORGANISATION STUDY

Selection and appointment of stockiest/direct sales customers

and others.

Price fixation of sales commission and overall sales policy

including market budget.

Order evaluation and acceptance of order registers, priority,

booking registers, dispatch registers etc.

To increase sales there are some marketing techniques adopted, mainly the 4p’s are

used to furnish their business. They are:

Price

Price is the money customers have to pay to obtain the product.

Price mainly involves decisions regarding base price, discount price, discount

allowances, freight payment, credit etc. pricing effect many factors including

employees, share holders, competitors and the public at large.

Place (distribution)

KERAFED’s products are distributed through various outlets; include

both private and public institutions. KERAFED is noted for its goods procurement

channel, better processing facilities and for a very big storage capacity. It has its stock

point in prominent cities, which help the organization to ensure availability of

KERAFED’s product to the customers. KERA has made its presents in felt in states

like Madhya Pradesh, Tamil Nadu, Andhra Pradesh and Karnataka also. KERAFED

had tie up with a leading retail chain in Dubai and Abu Dhabi for the two brands,

cooking oil ‘Kera’ and hair oil ‘Kera Kesh’.

Promotion

Sales promotion is an important and specialized function of

marketing department. Promotion covers advertising, personal selling and sales

promotion. Advertisement of Kerafed products are mainly done through media and

26

ORGANISATION STUDY

such type of things are done by star communication. Television and print media is the

main media to communicate with the customers. And now a day they are more

concentrating on exhibition s as promotion.

Sales volume of KERAFED

KERAFED continuous to play a dominant role as cooking oil in

the Kerala market. Between 400 and 600 tones of Kera coconut cooking oil was sold

in Kerala in pouches, every month. Kerafed expects to sell about 20 tones of coconut

cooking oil in the gulf market every month. Sales keep on creating records during

every onam seasons.

Kera sales volume

1 LITTER 75%

500ml 20%

100ml and others 5%

Competitors

The main competitors of KERAFED in the state are:

KPL

SUDHI

THEJAS

KLF NIRMAL

Parachute is the main market leader in the Indian branded coconut oil industry. The

main players in the Indian market are SHALIMAR, COCO CARE, TATA products

etc.

27

ORGANISATION STUDY

PRODUCTION DEPARTMENT

The production department function of KERAFED is to produce the

product according to the demand. Production department undertakes the process of

transformation of copra into oil and oil cake. A series of processing is used to convert

copra into oil. The machines and equipments in kerafed installed is in straight line

basis. KERAFED has two production units, KERAFED oil complex in Karunagapalli

and KERAFED coconut complex at Naduvannur, Calicut. The capacity of the plan is

200MTPD (Metric tons per day).

Plan manager is the head of units and the plant has two main

functional areas –production and quality control.

The two major commercial products derived from coconut are coconut

oil and copra. Copra is dried meat(endosperm) of the coconut and oil is extracted

from it through a mechanical process. Copra making is a systematic process through

which the fresh meat of coconut containing 50-55 percent moisture is dried either in

sunlight or using other sources of energy, to bring down the moisture content to 5-6

percent.

Functions of production department

The production department in Kerafed has many important

functions, which are as follows:

To prepare detailed production plans consistent with

companies production objectives

To receiving raw material and packing final product

To take the corrective actions from the point of the quality

assurance to the customers.

To ensures implementation of safety measures in the

preparation of equipments and process to avoid dangers to

the structures, equipments and men.

28

ORGANISATION STUDY

The production department of Kerafed has the following three divisions.

Storage division

Manufacturing division

Packing and filling unit

Hierarchy of production plant

Storage division

The storage capacity of go down is 6000tonnes. The godown

section is headed by an officer in charge whose office is situated inside the go down.

He maintains the record presenting the intake of copra and also transfer of copra to

the manufacturing division.

Manufacturing Division

The manufacturing unit is headed by a technical officer whose

cabin is situated within the manufacturing unit. The production plan of the units

depends on the market demand of the product. It depends or varies on the festival

seasons. More products are required during the festival seasons especially during

Onam.

The machines that are used in extracting the oil are:

1) Conveyor systems used for copra loading

2) Copra cutting cutter for slicing copra

3) Boiler system for heating copra

4) Expellers for copra crushing

5) Filters for oil filtering

6) Tanks for oil storage

7) Packaging

29

ORGANISATION STUDY

Production process

In the manufacturing unit dried copra is received through the

conveyors and is directly passed through a cutting machine and their it goes for

crushing. After crushing, the copra is converted into small pieces which are required

for extraction. These small pieces are transferred to the expellers by small passages

consisting of crushed blades and gates. The crusher blades cut the pieces of copra into

smaller pieces before being fed into expellers. The purpose of gates is to check the

flow of unwanted substances into expellers. The crush copra is then put into the

expellers and first extract oil, second extracted oil is then passed on to the first filter

and then second filter. This process of double filtration provides pure and high quality

oil. This oil is then passed on to the storage tanks through pipelines and the oil is

stored in the bulk for sediments in order to get clear oil for one week. After one week

it is used for packing and filling. The oil cake obtained as by-product will find a ready

market as cattle feed and in the manufacture of mixed cattle feeds.

Packing and filling unit

Packing and filling unit is highly mechanized and here oil is usually

packed in different packs i.e., from 6ml sachets to 15kg tins. As per the demand the

packing division takes oil from the storage tanks and uses it for filling into sachets,

pouches and bottles.

This section is headed my a separate officer, shift in charge whose

cabin is located inside the packing unit. Bottle filling line in the plant can

automatically fill and seal bottles. Quality check process in this unit is undertaken

under two levels, increases of the oil quality and also the quality of the packing

material. Before any oil is used for packing the quality control lab technically checks

that the lots of oil on the basis of specified guidelines due approved, the process of

packing is undertaken. The price of the product varies frequently and on that basis the

machine is adjusted to print the existing price

30

ORGANISATION STUDY

Coconut oil sale

Sale of Kera coconut oil

Year 2005-

2006

2006-

2007

2007-

2008

2008-

2009

2009-

2010

2010-2011

(up to 31-12-

2010)

Kera coconut oil

sold

4768 5655 7359 9957 10310 10202

31

ORGANISATION STUDY

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

0

2000

4000

6000

8000

10000

12000

Kera coconut oil sold

Kera coconut oil sold

TURNOVER

TURNOVER (Rs.Lakhs)

2005-2006 3726.45

2006-2007 4790.41

2007-2008 6448.34

2008-2009 8004.78

2009-2010 19160.37

32

ORGANISATION STUDY

2010-2011(up to31-12-2010) 11346.58

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110

5000

10000

15000

20000

25000

Turnover

Turnover

Zone wise sales of Kera oil in Kerala during 2010-2011(up to 31-12-2010)in M tones

Zone wise sales of Kera oil in Kerala

during 2010-2011(up to 31-12-2010)in M tones

South Zone 6019

Central Zone 2368

33

ORGANISATION STUDY

North Zone 1714

Total 10101

Sales

South zoneCentral zoneNorth zone

Trade Profit (Lakhs)

year (Rs.Lakhs)

2005-2006 -457.90

2006-2007 266.78

2007-2008 550.41

2008-2009 637.67

34

ORGANISATION STUDY

2009-2010 1094.38

2010-2011(up to 31-12-2010) 907.27

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

-600

-400

-200

0

200

400

600

800

1000

1200

Trade Profit

Trade Profit

QUALITY

In manufacturing, a measure of excellence or a state of being free

from defects, deficiencies, and significant variations, brought about by the strict

and consistent adherence to measurable and verifiable standards to

achieve uniformity of output that satisfies specific customer

or user requirements. ISO 8402-1986 standard defines quality as "the totality

of features  and characteristics of a product or service that bears its ability to satisfy

stated or implied needs."

35

ORGANISATION STUDY

QUALITY CONTROL

Quality control, or QC for short, is a process by which entities review the quality of

all factors involved in production. This approach places an emphasis on three aspects:

1. Elements such as controls, job management, defined and well managed

processes, performance and integrity criteria, and identification of records

2. Competence, such as knowledge, skills, experience, and qualifications

3. Soft elements, such as personnel integrity, confidence, organizational

culture, motivation, team spirit, and quality relationships.

The quality of the outputs is at risk if any of these three aspects is deficient in any

way.

Quality control emphasizes testing of products to uncover defects and reporting to

management who make the decision to allow or deny product release, whereas quality

assurance attempts to improve and stabilize production (and associated processes) to

avoid, or at least minimize, issues which led to the defect(s) in the first place. For

contract work, particularly work awarded by government agencies, quality control

issues are among the top reasons for not renewing a contract.

QUALITY CONTROL DEPARTMENT

The organization quality control laboratory meet Agmark

parameters confirm the purity of kera. A unique two stage filtering process is

employed by kerafed to retain the original aroma and flavors of coconut oil for a long

period

Copra with moisture content below6% is normally. Accepted for

processing in KERAFED. Once the quality report is ready from section, the material

36

ORGANISATION STUDY

receipt and service and service request prepared by the procurement section is given

to Account section for the approval of the cost of material and then passed by plant

manager

Copra procurement by KERAFED

Copra Procurement

year (Rs.Lakhs)

2005-2006 7671

2006-2007 9502

37

ORGANISATION STUDY

2007-2008 10890

2008-2009 16379

2009-2010 11038

2010-2011(up to 31-12-2010)

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

Copra procurement

Copra procurement

Copra crushing

2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011

(up to 31-12)

Karunagapally 5203 5666 7272 9885 12074 11718

Naduvanoor 2886 3660 3756 5081 4620 4169

Total 8089 9326 11028 14966 16694 15887

38

ORGANISATION STUDY

2005-2006

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

0

2000

4000

6000

8000

10000

12000

14000

KarunagapallyNaduvanoor

Production of coconut oil

2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011

(up to 31-12)

Karunagapally 3329 3618 4656 6330 7706 7504

Naduvanoor 1847 2359 2422 3277 2980 2693

Total 5076 5977 7078 9607 10686 10197

39

ORGANISATION STUDY

Production of CN oil cake

2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011

(up to 31-12)

Karunagapally 1731 1829 2360 3213 3986 3761

Naduvanoor 891 1147 1182 1620 1480 1350

Total 2622 2976 3542 4833 5466 5111

40

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110

1000

2000

3000

4000

5000

6000

7000

8000

KarunagapallyNaduvanoor

ORGANISATION STUDY

MANUFACTURING UNIT

41

EXPELLER I

GATE

CRUSHER

PASSAGE

CRUSHING UNIT

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110

500

1000

1500

2000

2500

3000

3500

4000

KarunagapallyNaduvanoor

ORGANISATION STUDY

QUALITY CONTROL PROCESS CHART

42

PRIMARY CO-OPERATIVE SOCIETIES

FIELD OFFICE

FIRST QUALITY CHECK BY SOCIETY

SECOND QUALITY CHECK BY MOBILE TEAM INSPECTOR

ACQUIRING COPRA FROM SOCIETY

PROCUREMENT OF COPRA

FARMERS/COCONUT GROWERS

EXPELLER I

ORGANISATION STUDY

CHAPTER-4

SWOT ANALYSIS

Strength

43

FACTORY

EXTRACTION UNIT

STORAGE

PACKING

SECOND QUALITY CHECK OF STORED OIL

FIRST QUALITY CHECK OF OIL BY FACTORY LAB

THIRD QUALITY CHECK OF COPRA BY FACTORY LAB

FOURTH QUALITY CHECK OF COPRA BY FACTORY LAB

TRANSFER OF COPRA TO FACTORY

COPRA USED FOR EXTRACTION

EXTRACTED OIL SEND FOR

OIL USED IN PACKING UNITS

ORGANISATION STUDY

Most popular brand name ‘KERA’.

The quality of the products is excellent.

Most modern machinery for oil extraction

Plants have adequate production capacity

Strong network of primary co-operative societies in the state

All support from government

Follow a very strict quality control measures

Weakness

Seasonal variation badly affects the procurement of copra

Many times Kerafed is forced to procure copra at a price greater

than the market price, as per the direction of NAFED

Lack of promotional activities

Not utilizing the installed capacity of production units.

Lack of advertisement

Opportunity

Diversification of the product

Advertisement and promotional activities the market can be

expanded to other states

Target of work may be fixed in all sections

Adequate support from NAFED, state government and

cooperative societies

Most modern technology is used here.

44

ORGANISATION STUDY

Threat

Unfiltered coconut oil obtained from other states is available in

market at low prices.

There are some arguments that coconut oil as edible oil cause

health problem

Heavy competition from private companies

There are other cooking oils which are available at very cheap

rates.

CHAPTER-5

FINDINGS AND SUGGESTIONS

Findings

KERA has very good brand image.

KERA coconut oil is used for cooking and as hair oil.

Lack of supervision and management.

The inadequate supply of copra adversely affects the function of

the federation.

Rural people prefer more kerafed product.

Not much importance is given on exporting.

45

ORGANISATION STUDY

Lack of raw materials in peak time

Kerafed’s plant at kollam is not functioning at its full capacity

At present advertisement of the kera coconut oil is less compared

to their competitors

Recommendations

More capital should be released for advertising and sales

promotion

Give some more attention to export markets.

Proper and efficient supervision and management is necessary at

oil complex at Karunagapally.

Market can be expanded to all over India as coconut oil contains

health benefits and also used in medicines.

The pricing method of kera should be examined and price should

be renewed periodically.

CHAPTER-6

CONCLUTION

The organization study covers all the theoretical and the practical matters of “The Kerala Kera Karshaka Sahakarana Federation Ltd”, (KERAFED), Thiruvananthapuram. It covers functional analysis, organizational structure, various departments, manufacturing units, and quality control techniques, promotional and marketing activities of KERAFED. Kera has a strong and powerful brand image. But Kerafed don’t try to utilize their maximum production capacity which, it creates some unavailability of their product in the market. If they are willing to utilize their maximum production capacity Kerafed can easily become the No 1 coconut oil producer in the world. And Kerafed should renew their price periodically; it creates

46

ORGANISATION STUDY

more attraction of their product among the customers. Initially KERAFED was formed for the betterment of Kera farmers, but today the company should keep good relationship between the farmers for making better result.

CHAPTER-7

BIBILIOGRAPHY

Annual report of KERAFED,2010

Sahari Gupta.K, Neeti Gupta, Financial management, Kalyani

publications,New Delhi.

Kothari, Research Methodology, A New Age International publication, New

Delhi.

www.kerafed.com

47

ORGANISATION STUDY

48