Inventory management

Final project report on

Inventory management system

CONDUCTED AT:

FEDERAL MOGUL GOETZE (INDIA) LIMITED,BAHADURGARH, PATIALA

SUBMITTED TO:

Punjab Technical University Jalandhar

In the partial fulfillment of the requirement for the degree of MBA (Master of business Administration) (2008-10)

Supervised by SUBMITTED BY

MS.KAVITA CHOPRA POOJA RANI MBA 4TH SEMESTER (finance) Universities roll no-80803317076

DESH BHAGAT INSTITUTE OF MANAGEMENT AND COMPUTER SCIENCE

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CONTENTS_________________________________________________________________

• Acknowledgement

• Declaration

• Certificate

• An Introduction

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SECTION-A: A BRIEF OVERVIEW OF FEDERAL MOGUL GOETZE

(INDIA) LIMITED, PATIALA

• An Introduction to GIL

• Important Products

• History Milestones

• Members of Management Body

• A Chronological View of product Information

• Social Activities

• Market Share

• Significance of Logo

• Primary and Secondary Objectives

• Vision

• Mission

• Important Customers

• Japanese Practices of 5-S

• Organizational Set up

• Organizational Chart

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Inventory managementSECTION – B: INTRODUCTION TO INVENTORY MANAGEMENT

AND INVENTORY MANAGEMENT IN FMGIL

• Introduction to Inventory Management

• Inventory Management Techniques

• Inventory Management in FMGIL

• Categorization

• Codification

• Various procedure adopted for Inventory Management in FMGIL

SECTION – C: RESEARCH METHODOLOGY

• Research Objectives

• Research Methodology

SECTION – D: FINDINGS AND SUGGESTIONS

SECTION – E: BIBLIOGRAPHY

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Nothing concrete can be achieved without optimum combination of inspection and perspiration. Like All other studies, this work is also result of the interaction of a number of minds who directly orIndirectly have contributed for completing this project. I owe a lot to many for the inspection partIt is very difficult to acknowledge so precious a dept as that of learning as that of learning as it’s the only debt that is difficult to repay expect through gratitudeIt is great honor and privilege and pleasure to express deep since of gratitude to MS.KAVITA CHOPRA (project guide) to placing complete faith and confidence in my ability to carry out this study and for providing me their inspiration, encouragement, help, valuable guidance, constructive criticism and constraint interest. They took personal interest in spite of their numerous commitment and busy schedule to help me complete my project .my project would not have seen the light of day without their masterly guidance and overwhelming help.It gives me tremendous pleasure in acknowledging the valuable assistance extended to me by various Personalities in successful completion of this project report.

I thanks all these for helping me in spite of their busy schedules.At last but not least, I extent my heartfelt gratitude to my family and friends help, cooperation, & constant encouragement for successful accomplishment of my project.

Pooja rani

CERTIFICATE5

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The project included in the project outlined INVENTORY MANAGEMENT SYSTEM of FEDERAL MOGUL GOETEZE INDIA. Submitted to DESH BHAGAT INSTITUTE OF MANAGEMENT OF COMPUTER SCIENCE affiliated to PUNJAB TECHNICAL UNIVERSITY.JALANDHAR for degree in master o business administration by POOJA RANI has been carried out under my supervision

This project report is her original piece of work & has not been submitted for any other degree at this or any other institute to best of my knowledge

PROJECT GUIDE KAVITA CHOPRA

DESH BHAGAT INSTITUTE OF MGMT &COMPUTER SCIENCE GOBINDGARH

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Chapter 1

Introduction

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It is good to have goodwill It is good to have enthusiasm But it is essential to have knowledge

Pt. J.L.NehruThe above quoted lines by the great soul Pt.J.L.Nehru rightly tell us learning is a very necessary

Part in ones life of one wants to achieve success &have proper knowledge about a particular aspect.

Thus, the objective of my project report was to get more knowledge and to go beyond the bookish that gives

Merely theoretical knowledge and to closely look at the practicality of the modern industry.

The topic of my project is “INVENTORY MANAGEMENT” which was meant to know

The project was carried at. FEDERAL MOGHUL GOETZE (INDIA) LIMITED, Bahadurgarh,

Aspects of inventory management like

Inventory control system, material planning and purchasing, categorization of items, valuation of

Inventory etc.

The first section of the report is company profile, which includes the introduction of organization

Group, a brief overview of FEDERAL MOGHUL GOETZE INDIA LIMITED and finance aspects at

FMGIL.8

Inventory management

In the second section, an introduction to inventory management is given which includes

Inventory control system, material planning and purchasing, categorization of items,-Inventory management at FMGIL is been explained. The various aspects of inventory management like economic order quantity technique, ABC classification,

In the section-C and D, research findings are described which are used to gather the necessary information and suggestions regarding different aspects of inventory management are included..The last section of the report section-E includes Bibliography.

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Inventory management

Established in 1954, Goetz (India) Limited (GIL) is joint

Venture between the Anil Nanda group and Federal Mogul, a

Global supplier of quality products and solutions to automotive

Industry. Goetz (India) Limited was established in 1954

as a joint venture with Goetze-Werke of Germany.

Goetze-Werke of Germany is now owned by Federal-

Mogul Corporation, a $6.3 billion global company and

One of the leading manufacturers of automotive

Components in the world.

Federal-Mogul Goetz (India) Limited is the largest

Manufacturer of pistons and piston rings in India.

Federal-Mogul has been creating value through innovation and leading technology for

More than 100 years. Today, the company is a key player in the global marketplace,

Serving industries that range from automotive and commercial vehicles to railroad and

Aerospace. Customers know they can rely on Federal-Mogul’s quality excellence in

Products, trusted brands and creative solutions.

This company started with a bold idea and over time grew into a FORTUNE 500

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Company with a global workforce thousands strong. The Federal-Mogul team has

Celebrated countless victories and worked hard to overcome the inevitable challenges.

The products basket besides pistons and piston rings also includes cylinder liners,

Light alloy castings and other sintered products. The company has its plants located at

Bangalore (pistons, piston rings and pins), Bhiwadi (sintered products) .The company

Has set up its first unit at Patiala (piston, rings, cylinder liners and castings). and

Started commercial production in 1957.

GIL has installed production capacity of 11 million pistons and 53 million piston

Rings.

ACQUISITION OF ESCORTS MAHLE LTD

Escorts Mahler Ltd. was a 50:50 joint venture between Escorts Ltd. & Mahle GmbH (Mahle)

manufacturing Pistons & Piston Pins at Bangalore & Patiala. Pursuant to the disengagement &

share purchase agreement among Escorts Ltd, Mahle & Escorts –Mahle Ltd. Mahle had

decided to exit from the joint venture & sell its entire share holding in Escorts- Mahle Ltd.

Having decided to exit from this joint venture, also sold its entire share holding in Escorts-

Mahle Ltd.

In view of the fact that the businesses of the Escorts-Mahle and Goetz (India) Ltd., are closely

inter-linked and have obvious financial and technical synergies due to common locations of

plants, common customers, complementary products etc., it was considered advisable in the

interest of the company to acquire the share capital of the Escorts-Mahle Ltd. through the

special purpose vehicle (100% subsidiary). The new company named “ESCORTS PISTONS

LTD.” came to existence on Nov.1, 2002.

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Further, Escorts Pistons Ltd. was amalgamated with Goetz (India) Ltd. on May 26, 2003 and

w.e.f. June 2003, the name of the company is “GOETZE INDIA LTD.”

Ab out Federal-Mogul

Federal-Mogul is a global supplier of automotive components, modules and systems serving the

world's original equipment manufacturers and the aftermarket industry. The company utilizes its

engineering and materials expertise, proprietary technology, manufacturing skill, distribution

flexibility and marketing power to deliver quality products and services, and leading brands. Federal-

Mogul is focused on driving global profitable growth and creating value to satisfy customer, employee

and stakeholder expectations.

Headquartered in Southfield, Michigan, the Company, which reported sales of $6.3 billion in 2005,

employs 42,000 people worldwide. Federal-Mogul was founded in Detroit in 1899. The Company’s

principal customers include many of the world’s foremost original equipment manufacturers of

automotive, light commercial, heavy-duty truck, agricultural, marine, rail and industrial vehicles and

equipment as well as the worldwide aftermarket.

Federal-Mogul’s products are sold under a variety of power brands, including but not limited to, AE®

engine products, ANCO® wipers, Champion® spark plugs and wipers, Fell-Pro® gaskets, Ferodo®

brake pads, Glycol® bearings, Goetz® piston rings, Moog® chassis products, National® wheel-end

components, Neural® pistons, Pain® gaskets, Sealed Power® engine products and Wagner® lighting

and brake products

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Product Range: Pistons, piston rings, cylinder liners, light alloy castings, sintered products

Quality Policy

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Production Capacity: Piston rings 55 Million

Pistons 13 Million

Turnover: April 09-March 10 INR 5124 Million

Net Profit (after tax): April 09 -March 10 INR (505) Million

Inventory management GOETZE (INDIA) LIMITED commits itself to leadership in national market for all its

products and ensuring total customers’ satisfaction highest in industry. It commits to

develop and build an image in the international market to achieve a sustained annual

growth in exports.

Policy

We shall continue to manufacture all our products in conformity with accepted

international norms/ standards.

We shall also continue to retain our leadership in development of products through

technical know-how from our Collaborators and in-house developments.

Consistent development of human resources through training at all levels will be our

major thrust area.

ANIL NANDA

(Chairman & Managing Director)

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IMPORTANT PRODUCTS

Pistons

For their original equipment, FEDERAL MOGUL Pistons is the first choice of every

discerning manufacturer like Telco, John Deere, Hindustan Motors, Mitsubishi Lancer, Tata

Cummins, Ashok Leyland, Mahindra, Escorts, Either, Maruti, Bajaj Auto, Fiat, Bajaj Tempo,

TVS, Yamaha motors, Swaraj Mazda etc.

GOETZE has state of the art test bed facilities, Design facilities for products, dies and tooling

with CAD — PRO—E and test bed facilities.

Production Capacity: 10 million Pistons per annum

Production Range: 30 mm to 300 mm Dia

Application

• Bi-Wheelers,

• Cars,

• Jeeps,

• Tractors,

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Inventory management• Light Commercial Vehicles,

• Heavy Commercial vehicles,

• High out put locomotive diesel engines

• Stationary Engine

• Industrial

Products suitable for

• 4 Stroke Engines

• 2 Stroke Engines

• Gasoline Engines

• • Diesel Engines

• CNG Engines

Features

• Autothermic

• Autothermatic

• Ring Carrier / Alfin

• Double C.I. Grooves

• Forged

• Steel cap pistons

• Pistons with cooling coil

• Thin Walled Pistons for Cars

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• Thin Groove pistons

GOETZE Piston Rings are the first preference of OEMs & ‘after market’ in

India. GOETZE has state of the art design facilities for products, tooling with CAD—PRO-E

and test bed facilities.

Goetze is committed for Innovation, introduction of new technology and continuous

improvement in its products.

Production Capacity: 53 million Rings per annum

Range: 30mm to 300mm DIA

Goetze manufactures a wide range of piston rings for:

• Bi-wheelers

• Tractors

• Passenger Cars & Jeeps

• Commercial Vehicles (HCV’s, MCV’s & LCV’s)

• Locomotive Engines

• Stationary Engines

• Industrial Tx Type Expander & Cr Plated Rails

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Coating on Running Surface

• Chrome Ceramic plated rings (CKS)

• Molybdenum Coated Rings

• Plasma Filled Rings

• Semi-Inlaid Rings

• Ferrox Filled Rings

• Chrome Plated rings

• Chrome Plated Ring

Salient Features

• Thin rings made from SG Iron

• Asymmetric profile rings

• Specially honed chrome rings

• Lower sharp edge rings

• Reverse torsion rings

• Conformable Chrome Oil Rings

• Keystone

• Napier

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Cylinder Liners

GOETZE manufactures wet and dry types of cylinder liners with honing, and sleeves for bi-

wheeler applications for our quality conscious customers.

Application

• Bi-wheelers

• Cars

• Tractors

• Light Commercial Vehicles

• Heavy Commercial Vehicles

• Stationary Engines

Range Production Capacity: 50 mm to 120 mm Internal Dia

Production Capacity: 0.5 million liners per annum

Features

• Thin wailed

• Plateau boned

• With and without flanges

Coating

• Phosphating

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Light Metal Casting

Goetze (India) Ltd. is making a wide variety of Light Metal Castings. These include Cylinder

Blocks, Cylinder Heads, Aluminum tube castings and Aluminum crown handles for single

cylinder engines.

Sintered Metals Products

Goetze India Limited (Sintered Products Division), produces a wide range of sintered metal

products for varied automotive applications such as valve, trains, transmission and oil pumps

with technical assistance from manufacturing facilities and R&D centers of Federal mogul

sintered products in U.K., France and USA.

Goetze (India) Limited (Sintered Product Division) are suppliers to most of the O.EMs in India

and abroad. Some of these are:-

• Maruti Udyog Limited

• Tata Motors

• Bajaj Auto Limited

• Tvs

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• Eicher Motors

• Mahindra & Mahindra

• Escorts

• Swaraj Mazda

• Ashok Leyland

• Hero Honda

Valve Train Parts

Valve seat inserts and valve guides are a special category of sintered components for new

generation engines. Goetze India limited (Sintered Product Division) uses latest technology /

processes along with specially sourced powder Little wonder that auto majors manufacturing

engines for varied applications such as two/three wheelers, passenger cars, LCV MCV’s, HCV

and tractors prefer GIL Sintered Products.

Synchronizer Hubs

Sintered Synchronizer Hubs offer a very cost effective alternative to conventional hubs and at

the same time, meet the ever-increasing performance requirement of automotive designers.

Oil Pump Rotor & Gears

Sintered Oil pump rotor & gears are one of the widest used sintered application in an

automotive industries. Goetze India Limited (Sintered Products Division) with support from

Federal Mogul Sintered Products’ R&D centers has developed its own capabilities to design

and manufacture oil pump motors.

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HISTORY MILESTONES

1954 Incorporated as a JV with Goetze Werke 1957 Ring & liner production Patiala 1958 Piston production as escorts

(Automotive Division) (Collaboration:Mahle)

Patiala

1960Cast iron / Forged piston production started

Patiala

1968 Pins / ring carrier production started Patiala

1977 Piston / ring production started Bangalore

1982Steel rings / Large bore locomotive piston

Bangalore

1985 Light alloy products Patiala 1989 Auto thermic pistons production Bangalore

1990 Moly coated / IKA / chrome oil rings Patiala

1992Large bore rings / pistons for battle tanks

Bangalore

1994 Composite pistons / new ring foundry Bangalore

1996 Escorts (Automotive Division) hived off into joint venture with M/S Mahle, Germany

1997 Goetze TP (India) Ltd. - Manufacturer of steel rings

2001 Merger of Federal-Mogul sintered products Ltd. with Goetze (India) Ltd.

2003 Merger of Escorts pistons activities with Goetze (India) Ltd.

2004 Introduction of chrome-ceramic rings 2004 Technical collaboration for pistons with Federal-Mogul Corporation 2006 Majority stakeholding acquisition by Federal-Mogul Corporation

2006Name changed "Goetze (India) Limited" to "Federal-Mogul Goetze (India) Limited"

MEMBERS OF

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Inventory managementMANAGEMENT BODYChairman (Non-Executive) Mr. Charles B. Grant Vice Chairman, Managing Director & C.E.O.

Mr. Arun Anand

Director Mr. Rainer JueckstockDirector Mr. Charles H. PolzinDirector Mr. Mukul GuptaDirector Mr. Vishvjeet Kanwarpal Management Managing Director and Chief Executive Officer Mr. Arun Anand

Corporate Leaders Executive Director - Sales, Marketing & Applications Mr. Mohan Narayanan

a.Original Equip. Sales Mr. Yogesh Choudharyb.Aftermarket & Sales Mr. Sanjeev Singh c.Exports Mr. G. S. Arshi

Executive Director - Manufacturing Operations Mr. Andreas Kolf

a.Bangalore Plant Manager

Mr. K. Saravanan

b.Patiala Plant Manager Mr. Sunit Kapur

c.Bhiwadi Plant Manager

Mr. A. R. Ahuja

Director - Finance & Secretariat Mr. Rajan Luthra Director - Plant Finance Mr. Rustin Murdock Director – Projects Mr. Rakesh Anand

Director – Procurements Mr. A. R. Ahuja

CHRONOLOGICAL VIEW OF PRODUCT INTRODUCTION AT

GOETZE.

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Inventory management1954 Piston Rings and Cylinder Liners

1960 Pistons

1961 Assembly of Tractors

1962 Motorcycles, Railways Couplers

1963 Automatic Shock Absorbers

1965 Escorts Tractors

1969 Ford Tractors

1971 Industrial and Construction Equipments

1979 Excavator Loaders

1981 Yamaha RX-100, 100 CC Motorcycles

1985 Electronic PABX

1991 Harvester Combines

1992 VSAT Satellite Communication Systems

1993 Mobile Communications

2008 Forklift Trucks

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Company MARKET SHARE OF PISTON

MANUFACTURES IN INDIA

Company Name Market Share (%)

Goetze 36.5

Perfect Circle 12.0

IP Ring 16.5

Shriram Piston 22.5

SAMKRG Piston 9.0

Menon Piston 3.5

36.5

1216.5

22.5

9 3.5Goetze

Perfect Circle

IP Rings

Shriram Piston

SAMKRG Piston

Menon Piston

•

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EXPORT DESTINATION

♠ Dubai

♠ Bangladesh

♠ Singapore

♠ Egypt

♠ Mauritius

♠ U.S.A

♠ Germany

♠ Nepal

♠ Sri Lanka

COLLABORATIONS

A. GERMANY

♠ Faun

♠ Class

B. JAPAN

♠ Yamaha

♠ Kayaka

♠ Mikni

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C. UK

♠ JCB (Goetze)

♠ Ford

D. USA

♠ HUGHES

E. FRANCE

♠ Bosch

♠ Dynapal

SIGNIFICANCE OF LOGO

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The logo of Federal Mogul Goetz (India) Limited has been prepared with certain

objective in mind and is symbolic in more than one way.

So, overall, the logo represents GIL’s concern for Workmanship, Quality and Technology.

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Vision of the company To be one of the worlds’s leading automotive solutions provider

Mission of the Company

Our company has committed to increase shareholder value by aggressively pursuing growth

and profit opportunities by providing irmovative diverse and high performance products and

solutions to meet our customers’ needs. We shall provide our work force with an environment

that develops teamwork, continuous learning and Improvements that rewards good performers.

We wall support our products with 11 technical expertises at the customers end. W. Value the.

Environment and the community and would lice to build better ftiture for our children..For our

company customer are king and our aim is to satisfy the need of the customers. In short

“Steadily moving towards leadership with piston with vision strategy seeing it as the best way to leaders in business”

Certifications Achieved

The Patiala and Bangalore Plant are both ISO 9001 I QS 9000 certified and under ISO I TS

16949 and ISO 14001 certification. Bhiwadi Plant is also having the certification of ISO / TS

— 16949/ISO 14000 certified.

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IMPORTANT CUSTOMERS

• Ashok Leyland Ltd.

• BajajAutoLtd

• Bajaj Tempo Ltd

• Birla Yamaha Ltd.

• Eicher Motors Ltd.

• Elgi Equipments Ltd.

• Escorts Ltd. (Auto Suspension Division)

• Escorts Ltd. (Farmtrac Division)

• Escorts Ltd. (Tractor Division)

• Frick India Ltd.

• Hero Honda Ltd.

• Hero Motorcycles & Scooter Ltd.

• Hero Motors Ltd.

• Hindustan Motors Ltd.

• Honda Seil Power Products Ltd.

• Indian Railways

• International Tractors Ltd.

• Kinetic Engg. Ltd.

• Kinetic Motors India Ltd.

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Inventory management• Kirloskar Oil Engines Ltd.

JAPANESE PRACTICE OF “5-S”

Goetze has adopted the Japanese Practice of 5s.

This enables the plant to have better working conditions and also increase work efficiency. A

copy of it also displayed at each shop and depth to motivate the employee towards healthy

work environment.

Meaning and benefits of 5S system are as follows

1. SEIRI: It stands for “Sorting”

Take out necessary items and suitably dispose with them

Benefits:

1. Effective Space Utilization

2. Stop Material from deteroiting or getting damaged

3. Reduce wastage and searching items

2. SEITON: It stands for “Set in Order”

Arrange. all necessary items in a proper order so that they can be easily picked up for use

Benefits:

1. Reduce preparation and machine setting and machine setting timings.

2. Reduce time in locating or waiting for Tool Parts and Machines.

3.SIIESO: It stands for “Shine/Completely Clean”

Clean your workplace completely so that there is no dust anywhere.

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Inventory managementBenefits:

1. Promotes Orderly and Safe Working Environment

2. Reduces Breakdown and Accidents.

3. SEIKETSU: It stands for “Standardize”

Maintain a high standard of house keeping and work place organizational at all times

Benefits:

1. Quick Response through Visual Management

2. Create a maintenance system of House keeping for all the times.

4. SHITSUKE: It stands for “Self Discipline Attitude”

Train People to follow Good House Keeping Discipline Independently

Benefits:

1. Self Di scipline

2. Improves Industrial Safety

3. Creates Healthy Attitude and Habits

Advantages of 5S

• Healthy Working Environment

• Improves Work Efficiency

• Producting Better Quality Products and Higher Productivity

• Cutting Cost Down

• Ensuring Delivery on time

• Safe Working

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Inventory management• High Morale and Better Life

ORGANISATION SET UP

The organizational set up of the following departments is studied in detail:

1. Finance Department

2. Personnel Department

3. Purchase and Store Department

4. Production Department

FINANCE DEPARTMENT

D.G.M. (Finance), Patiala who is directly responsible to Plant Head (Finance and Accounts), one of

the most reputed Functional Department in GOETZE (INDIA) LTD. C.G.M. manage the Department

and under him there are two managers, one is Finance Manager and other is Costing Manager. The

Finance Manager is assisted by two supervisors one of these is responsible for cash and bank balances

and other is responsible for bills payable. Each supervisor is given two or three assistants to work

under him.

The amount of investment to be put in current assets like cash in hand, bank balance, loans and

advances, inventories, accrued expenses, dividends payable etc. all are decided by Finance

Department.

The realization of cash for the purpose of raw materials components and spares to pay wages and

salaries to incur day to day expenses and overhead costs, to meet selling costs to provide credit

facilities to customers and to maintain inventories is also the function of this department.

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Inventory managementThe formulation of policies with regard to profitability risk and liquidity, decisions about comparison

and level of current assets and liabilities, formulation of production policy to keep the production

steady by accumulating inventories, formulation and execution of credit policy is also the function of

Finance Department.

This Department is responsible for handling transaction relating to purchase of raw material as well as

accounts relating to sales. It is also concerned with payment of all expenses incurred by the company

like purchase of raw material, electricity bills, repairs etc. It is also concerned with valuation of

various costs relating to inventories.

It deals with determination of monthly wages, salaries of employees, fringe benefits of retirement,

provident funds deduction, incentives, bonus and all the rewards, which the employees get for

rendering their services to the company

Functions of Finance Department

Cash Flow:

The plant is preparing C.F. statements, to be conveyed to HO. These include sources as well as

application of funds. Similarly applications of funds related to the salary, payment to suppliers. Major

expenses (like Electricity, Telephone Bills, Excise duty and other personal & sales & administration

expenses).

Costing:

The costing is being done for all the products manufactured at the plant. These relate to Piston, Ring,

Cylinder Liners and Light Alloy Products. The Historical base is being followed for costing purposes.

Consumption:

Every item being received in the plant for consumption. Input is being accounted for at the plant. The

ledgers are maintained for every receipt and issue.

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ORGANIZATIONAL CHART OF FINANCE DEPARTMENT

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Mr. Ajay Singla (Manager Finance)

Costing, Fixed assets & CWIP

General Accounting

MIS Reporting Store A/cing & Bills Payable

Mr. S P Singh Chopra

Mr. Inderjit Singh

Mr. Manmohan Singh

Mr. Bharat Bhushan

Mr. Sarbjit Singh

Mr. O P Ghai

Mr. Ranjit Singh

Mr. Rabinder Singh

Mr. Harinath Singh

Mr. Ramesh Kumar

Mr. Ashok Kumar

Mr. Ravinder Kumar

Mr. Suresh Kumar

Mr. Rajnesh Uppal

Mr. Ajay Jindal

Inventory management

PERSONNEL DEPARTMENTPersonnel department advises the management on all matters relating to personnel administration. The

top management takes into account its advice before arriving at final decisions on personnel and

administrative matters. Personnel Policies in GOETZE (INDIA) LIMITED have been divided into

three parts:

a. PERSONNEL FUNCTIONS to encourage the adoption and utilization of latest

methods and techniques in areas of manpower planning and development and keeping avenues

of promotion open to employees.

b. PROVISION OF COMMUNICATION, TRAINING AND WELFARE

MEASURES, EMPLOYEE COMMUNICATION so that employees contributes their best to

company’s objectives and also get opportunities for advancement and self-development.

c. INDUSTRIAL RELATIONS between employer and employee so as to promote

satisfactory relations by providing channels for upward and downward communication and

establishing systematic procedure for redress.

PURHCASE AND STORE DEPARTMENT

Purchase and Store are two Departments, which go hand in hand. It is very essential that there should

be proper synchronization between Purchase Department and Store Department.

In GOETZE (INDIA) LIMITED, the main responsibility of Purchase Department is to receive orders

from other Departments, do the market survey, list the potential sellers and the rates, choose the best

and go ahead with purchase. The purchase order is placed only with approved contractors. The

Purchase Department scrutinize the following aspects:

a) Quality and Technical specifications

b) Delivery

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Inventory managementc) Prices

Once the purchase order has been placed, it is sent to stores where the store gets ready to receive the

incoming material. When the material is received, a notification is sent to the Finance Department.

Stores deal with an array of material, which can be divided into:

a) Raw materials

b) Components

c) Standard items or patent items

d) Miscellaneous items

PRODUCTION DEPARTMENTThe Department is responsible for production of various items fixed on basis of production budget,

which includes:

a) Raw material budget

b) Labor budget

c) Plant utilization budget

GOETZE (INDIA) LIMITED turns out a wide variety of Piston Rings for Bi-Wheelers, Heavy Light

Commercial Vehicles and Motor Cars etc. The Company has maintained steady growth in Piston

Rings in view of ready acceptability of its products. Form modes production of 22517 rings in 1957 it

touched a figure of 28 million in 2009-10

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Inventory management

INTRODUCTION TO INVENTORY MANAGEMENTInventory management refers to the process of managing the stocks of finished products,

Semi-finished products and raw materials by a firm. Inventory management, if done

Properly, can bring down costs and increase the revenue of a firm. How much one should

Invest in inventory management? The answer to this question depends on the volume and

Value of inventory as a percentage of the total assets of a firm.

Inventory Management involves the control of assets being produced for the

purposes of sale in the normal course of the company's operations. The goal of

effective inventory management is to minimize the total costs - direct and

indirect - that are associated with holding inventories. However, the importance

of inventory management to the company depends upon the extent of investment in

inventory.

The task of inventory planning can be highly complex in manufacturing environments. At the

same time, it rests on fundamental principles. The system used for inventory must tie into the

operations of the firm. Inventory planning and management must be responsive to the needs

of the firm. The firm should design systems, including reports that allow it to make proper

business decisions

The.

Inventory Management system and the Inventory Control Process provides information to

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Inventory managementEfficiently manage the flow of materials; effectively utilize people and equipment, coordinate

internal activities, and communicate with customers. Inventory Management and the activities of

Inventory Control do not make decisions or manage operations; they provide the information to

Managers who make more accurate and timely decisions to manage their operations.

The basic building blocks for the Inventory Management system and Inventory Control activities are:

Sales Forecasting or Demand Management

Sales and Operations Planning

Production Planning

Material Requirements Planning

Inventory Reduction

TYPES OF INVENTORY

Four kinds of inventories may be identified:

1. Raw materials Inventory: This consists of basic materials that have not yet been

Committed to production in a manufacturing firm. Raw materials that are purchased from

firms to be used in the firm's production operations range from iron ore awaiting processing

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Inventory managementinto steel to electronic components to be incorporated into stereo amplifiers. The purpose of

maintaining raw material inventory is to uncouple the production function from the purchasing

function so that delays in shipment of raw materials do not cause production delays.

2. Stores and Spares: This category includes those products, which are accessories to the

main products produced for the purpose of sale. Examples of stores and spares items are

bolts, nuts, clamps, screws etc. These spare parts are usually bought from outside or some

times they are manufactured in the company also.

3. Work-in-Process Inventory: This category includes those materials that have been

committed to the production process but have not been completed. The more complex and

lengthy the production process, the larger will be the investment in work-in-process inventory.

Its purpose is to uncouple the various operations in the production process so that machine

failures and work stoppages in one operation will not affect the other operations.

4. Finished Goods Inventory: These are completed products awaiting sale. The purpose of

finished goods inventory is to uncouple the productions and sales functions so that it no

longer is necessary to produce the goods before a sale can occur.

Methods adopted to value raw material inventory control

The following methods can be adopted to value the raw material:

• First-In-First-Out (FIFO): When a firm adopts the FIFO method to price its raw material, the

40

Inventory managementissue of material from the stores will be in the order which it was received. Thus the pricing

will be based on the cost of material that was obtained first.

• Last-In-First-Out (LIFO): In the LIFO method, the material issued will be priced based on

the material that has been purchased recently.

• Weighted Average Cost Method: The pricing of materials will be alone on weighted average

basis (weights will be given based on the quantity).

• Standard Price Method: Material is priced based on a standard cost, which is

predetermined. When the material is purchased the stock account will be debited with the

standard price. The difference between the purchase price and the standard price will be

carried into a variance account.

Replacement / Current Price Method: In this method material is priced at the value that is

realizable at the time of the issue.

INVENTORY MANAGEMENT TECHNIQUES

While the total ordering costs can be decreased by increasing the size of order, the carrying

costs increase with the increase in order size indicating the need for a proper balancing of

these two types of costs behaving in opposite directions with changes in order size.

Again, if a company wants to avert stock-out costs it may have to maintain larger inventories

of materials and finished goods, which will result in higher carrying costs. Here also proper

balancing of the costs becomes important.

41

Inventory managementThus, the importance of effective inventory management is directly related to the size of the

investment in inventory. To manage its inventories effectively, a firm should use a systems

approach to inventory management. A systems approach considers in a single model all the

factors that affect the inventory.

A system for effective inventory management involves three subsystems namely:

1.economic order quantity

2. reorder point

3. stock level

ECONOMIC ORDER QUANTITY

The economic order quantity (EOQ) refers to the optimal order size that will result in the

lowest total of order and carrying costs for an item of inventory given its expected usage,

carrying costs and ordering cost. By calculating an economic order quantity, the firm attempts

to determine the order size that will minimize the total inventory costs.

Total inventory cost = Ordering cost + Carrying cost

Total ordering costs = Number of orders x Cost per order

= $ U / Q X F

Where

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Inventory managementU = Annual usageQ = Quantity orderedF = Fixed cost per orderThe total carrying costs = Average level of inventory x Price per unit x Carrying cost

REORDER POINT FORMULA

One can adopt a much simpler formula which gives reasonably reliable results in calculating

at what point in the level of inventory a reorder has to be placed for replenishment of stock.

The formula along with its application is given below, using the notation developed earlier.

Reorder point = S x L + F ( S x Rx L)

Where

S = Usage in unitsL = Lead time in daysR = Average number of units per orderF = Stock out acceptance factor

The stock-out acceptance factor, `F', depends on the stock-out percentage rate specified and

the probability distribution of usage (which is assumed to follow a Poisson distribution). For

any specified acceptable stockout percentage the value of `F' can be obtained from the figure

presented below.

43

Inventory managementSTOCK-LEVEL SUBSYSTEM

This stock level subsystem keeps track of the goods held by the firm, the issuance of goods,

and the arrival of orders. It maintains records of the current level of inventory. For any period

of time, the current level is calculated by taking the beginning inventory, adding the inventory

received, and subtracting the cost of goods sold. Whenever this subsystem reports that an

item is at or below the reorder-point level, the firm will begin to place an order for the item.

SAFETY STOCK

Once again in real life situations one rarely comes across lead times and usage rates that

are known with certainty. When usage rate and/or lead time vary, then the reorder level

should naturally be at a level high enough to cater to the production needs during the

procurement period and also to provide some measure of safety for at least partially

neutralizing the degree of uncertainty.

The question will naturally arise as to the magnitude of safety stock. There is no specific

answer to this question.

However, it depends, inter alia, upon the degree of uncertainty surrounding the usage rate

and lead-time. It is possible to a certain extent to quantify the values that usage rate and

lead-time can take along with the corresponding chances of occurrence, known as

probabilities. These probabilities can be ascertained based on previous experiences and/or

44

Inventory managementthe judgmental ability of astute executives. Based on the above values and estimates of

stock-out costs and carrying costs of inventory it is possible to work out the total cost

associated with different levels of safety stock.

Kanban

Another highly effective way of cutting down on WIP is through the use of kanban, Japanese for sign.

Kanban is a tagging system that is essentially a communication system designed to inform production

across the entire plant about what to do and when to do it. Essentially this is a system that tells people

when to produce what

ABC Procedure for Categorizing of Inventory

The general procedure for categorization of items into `A', `B' and `C' groups is briefly

outlined below:

• All the items of inventory are to be ranked in the descending order of their annual usage

value.

• The cumulative totals of annual usage values of these items along with their percentages to

45

Inventory managementthe total annual usage value are to be noted alongside.

• The cumulative percentage of items to the total number of items is also to be recorded in

another column.

• An approximate categorization of items into A, B, and C groups can be made by comparing

the cumulative percentage of items with the cumulative percentage of the corresponding

usage values.

Advantages of the ABC Inventory System

The advantages of the ABC system are as follows:

1. It ensures closer control on costly items in which a large amount of capital has been

invested.

2. It helps in developing a scientific method of controlling inventories, Clerical costs are

reduced and stock is maintained at optimum level.

3. It helps in achieving the main objective of inventory control at minimum cost.

4.The stock turnover rate can be maintained at comparatively higher level through .

scientific control of inventories.

The system of ABC analysis suffers from a serious limitation. The system analyses the items 46

Inventory managementaccording to their value and not according to their importance in the production process. It

may, therefore, sometimes create difficult problems. For example, an item of inventory may

not be very costly and hence it may have been put in category C. However, the item may be

very important to the production process because of its scarcity. Such an item as a matter of

fact requires the utmost attention of the management though it is not advisable to do so as

per the system of ABC analysis. Hence, the system of ABC analysis should not be followed

blindly.

INVENTORY MANAGEMENT IN FEDERAL MOGUL GOETZE INDIA LTD

ABC Analysis is being used to manage the inventories. A category items contain high value items and

important material directly linked with production. It includes one product i.e. CIMSTAR MB62C. B

Category includes items, which are directly linked with production but are having less value than

items. It includes three products i.e. SERVO SYSTEM 68% HYPSIN EP-68, Cutting oil, Arc light.

Category C includes items products such as mobile oil, kerosene oil, power oil, servo system 121,

servo CUS, quenching oil, preventing oil etc.

In stores computers are being used to store maximum, minimum, re-order levels of each item.

Recently the firm has started using JIT technique.

The purchases of FMGIL are centralized and authority lies with the purchase department.

Major purchase is done by head office but local purchase is also for certain items.

47

Inventory managementProcedure of acquiring inventories starts with the receipt of material. When the material

reaches the main gate it needs to be inspected and only after inspection of invoices materials is sent to

the store department. Then the material is inspected and is approved or rejected as the case may be.

MATERIAL PLANNING AND PURCHASING

Purchasing in FMGIL is centralized and authority lies with purchase department. No body is

allowed to make purchase himself, directly. For purchasing purpose a meeting is held at held office in

which planning is done on basis of last year’s consumption. After the raw material planning has been

made, purchase is done by the head office itself and planning report is sent to sub-offices. Although

major purchase is done by head office but local purchase can also be done for certain items.

The items, which can be locally purchased, are divided into two types:-

For local purchase as well as for head office purchase levels have been fixed as:-

RECEIPT OF MATERIAL

As the material reaches the main gate of the factory, security person puts stamp on backside of

invoice or challan. After this the material reaches the Store department

INSPECTION OF MATERIAL

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TYPE ‘4’ TYE ‘5’

(Locally purchasable) (Head office purchase stock items)

Inventory managementOnce the material has been received by store then it is the duty of either inspection department

or store department to inspect the material. Here it is checked out that the material is according to

specification and the material quantity is neither greater nor lesser in number then the order placed if it

is according to specification, then GIR is accepted.

According to the type of material, either physical verification is done or composition of

material received is checked out. In physical verification, the quantity of material, the working order to

material and specification fulfillment is taken into account e.g. for electronic goods. For checking

composition of the material e.g. in case of alloy or sand it is seen out, whether the received material

has proper composition as per requirements of the company.

ISSUE OF MATERIAL

In FMGIL the material is issued for two purposes:-

1. Direct purpose : for manufacturing of components 2. Indirect : generally in the nature of store and spares, tools etc.

Store department has two types of items:-

1. Stock

2. Non-stock

The material asked by various departments can either be stock items or non-stock items. If a

department has to ask for stock items it prepares material indents form of the items required in which

description of material is thoroughly provided. Four copies of indents are prepared – Blue, Red,

Yellow and White. The department keeps white copy, itself for record and other three copies are sent

49

Inventory managementto store department here, Red copy is kept by store for record purposes. Blue copy is sent to Finance

Department for evaluation while Yellow copy is sent to Purchase department.

If the material is being purchased for first time, then purchase department, asks for quotations

from the supplier. According to these quotations, the purchase department Purchase the material. If it

is routine material, then the material can be purchased from routine supplier without quotations. Stock

items required by various departments from the store are issued as such and no yellow copy is sent to

purchase department but both red and yellow copy are kept by store department itself. While blue copy

is definitely sent to finance department for evaluation of stock item.

CLASSIFICATIONS OF INVENTORY

FMGIL inventory can be classified under following three main categories:-

1. Raw material

2. Work in progress

3. Finished goods

The raw material inventory can be further classified and maintained under following two

headings:-

1. Stores and spares

2. Tools, jigs and dies

CATEGORISATION OF ITEMS 50

Inventory managementIn FMGIL categorization of items is done according to the following categories:-

1. ABC CLASSIFICATION

Under this system items are classified according to their value and usage rate. An item consists

of items having maximum value but minimum consumption. B items consist of items of moderate

value and moderate consumption. C item consists of items having minimum value and maximum

consumption.

ITEM NO. OF ITEMS IN % AGE APPROXIMATE VALUEA 10% 70%B 20% 20%C 70% 10%

2. XYZ CLASSIFICATION

This classification is based on the value of inventory at the end of a given period of time,

normally closing date of a financial year. X items are those whose inventory value is high, Y items are

those whose inventory value is medium and Z items are those whose inventory value is low or

minimum.

3. SDE CLASSIFICATION (Scarce, Difficult and Easy Classification)

This classification is based on the problems that a company may face while purchasing of the

material from the market due to short supply or unavailability. Scarce items are those, which are in

short supply in the market and are not easily available. Difficult items may be termed as those, which

are not scarce but are difficult to arrange and delivery period is long. Easy items are normal standard

items stored by vendors and are routinely supplied as per orders.

4. GOLF CLASSIFICATION (Govt., Open, Local, Foreign Classification)

51

Inventory managementThis classification is based on the source from which the suppliers are to be availed. Some of

the items may be government controlled or available through government-canalized agencies. Some

items are easily available at central and local level and some items may be imported from other

countries.

5. FSN CLASSIFICATION

This classification is based on the pattern of movement of items i.e. issue from stores. Fast

moving, slow moving and non-moving items. Fast moving items are regular items and are to be kept

mostly for regular supply.

CODIFICATION OF ITEMS

In FMGIL there are many items of inventory, due to such large number, codes have been

assigned to every item. However code assigned to every item follows a specification order, so that

easy identification of every item can be done. Emphasis on codification is considered very much

essential in FMGIL.

51. RAW MATERIAL52. FOUNDARY FLUXES, OILS AND LUBRICANTS 53. PACKING MATERIALS 54. GRINDING/ABRASIVE MATERIALS 55. DRILL56. CUTTER 57. CARBIDE TOOLS 58. MSSS/BRASS/PHOSPHOROUS MATERIALS60. BEARING 61. V-BLT62. CIVIL AND PIPE FITTING MATERIAL63. RUBBER AND AEHED PRODUCTS64. NUTS, BOLTS, WASHERS & SPACERS 65. HAND/INSPECTION TOOLS

52

Inventory management66. WELDING AND FIRE FIGHTING MATERIAL67. WELFARE ITEMS 68. CASTINGS AND FABRICATORS

VARIOUS PROCEDURES ADOPTED FOR INVENTORY

MANAGEMENT IN FMGIL

PROCEDURE FOR CONTINUOUS IMPROVEMENT

Objective:-

To define procedure for continuous improvement.

Scope:- Stores

Responsibility

• Head Stores

• Supervisor Stores

Procedure:-

1) Continuous improvement is adopted across the board in stories.

2) Suitable areas of continuous improvement and techniques shall be identified by Head

Stores and listed down in continuous Improvement Plan. Head stores shall prioritize projects

and appropriate actions shall be initiated.

3) Improvement/development observed in one area is suitably adopted in other areas.

4) Improvement activities shall be managed by using following steps:-

i. Deciding objectives for improvement.

ii. Team information.

iii. Action identification.

iv. System implementation, verification, documentation and training.

53

Inventory management5) The progress on continuous improvement projects shall be reviewed during

Management Review Meeting. The continuous improvement plan shall be reviewed and

updated, if necessary.

6) Results of various functional continuous improvement activities shall be communicated

and displayed in respective areas.

References:-

• Continuous Improvement Plan

• Management Review Report

PROCEDURE FOR INTRA-DEPARTMENT TRANSFER

Objective:-

To define the procedure for intra-plant transfer.

Scope:-

Items as per initial material list for purchase Patiala Plant and initial materialist for Head Office

materials.

Responsibility:-

• Chief Head Office materials

• Head Incoming material

• Head Laboratory

• Head Stores

• Head Purchase-Patiala Plant

• Head User Department

54

Inventory managementProcedure:-

1) For requisition of materials from other plants, a request for itnra-plant transfer is sent in

the format “Request for Stock Transfer.”

2) On receipt of material the inspection of stock transferred material is done as per

procedure for inspection and Testing of Incoming Material and the Patent Materials are

inspected as per procedure for inspection of Patent Materials.

3) It is the material required by other plants, depending upon the availability of stock,

raising Dispatch Advice cum Performa Invoice for Modvat Material or Dispatch Advice cum

Performa Invoice for stock transfer transfers the item in stock.

References:-

• Procedure for inspection of patent material.

• Initial material list for purchase-Patiala Plant.

• Dispatch Advice cum Performa for Modvat Material.

• Request for stock transfer.

• Procedure for Inspection and Testing of incoming material.

RESEARCH METHODOLOGY

This part of the report i.e. Research Methodology is intended to give the details of the conecptual

framework within which the study has been carried out. This section covers the following aspects:

A. Objectives of the Study

B. Research Methodology

A: Objectives of the study

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Inventory management

1. To know the functioning of the inventories and understand the system of procurement of

material , its receipt , inspection and its issuing.

2 . To understand the accounting and valuation of raw material , work-in- progress and finished goods.

3 . To analyze the inventory control techniques used by company and their techniques .

4 . To study the performance of the company in relation to inventories and thus provide suggestions if any on the basis of analysis and interpretataion of the data .

B : Research Methodology

The methodology used for the collection of data is of secondary type which is being explained here :-

SECONDARY DATA

It is mainly based upon annual reports , magazines , office reports and various published documents of

FEDERAL MOGUL GOETZE INDIA LTD patiala.

Data has been collected for five years (i.e. financial year 2005-2010) , then compiled and thereafter

statistical analysis of the information has been done, thereafter various ratios relating to the inventories

has been calculated and tables showing variation in the inventories for five years have been made.

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Inventory management

SWOT ANALYSIS

Previous years were challenging with the company’s business constrained by unfavorable economic

conditions. The slow down in the industrial production, in particular in the automobile industry, had an

adverse impact on the company’s business.

‘S’ - STRENGTHS

‘W’ - WEAKNESSES 57

Inventory management‘O’ - OPPORTUNITIES

‘T’ - THREATS

1. STRENGTHS

The major strength of the company is that it is well established. The relationship between

management and employees is very good, as in agreement between management and employees was

signed on March 2010. Due to this agreement there is no fear of strikes and lockouts in the company.

Few competitors

Profit making and reputed firm

Availability of skilled and cheap labour

Technical efficiency

Operating efficiency

2. WEAKNESSES

The major weakness of the plant is that it does not have Marketing Department and it has to

depend totally on Head Officer for marketing activities.

Low return of capital employed.

Problem of timely availability of raw material.

Facing some infrastructure problems.

3. OPPORTUNITIES

With the implementation of EURO norms, there is need for high strength material rings where

realizations are much better as compared to standard rings. In this high technology value segment the

unorganized sector cannot compete and thus there is tremendous opportunity for the company to

increase domestic competition. There are increasing opportunities for exports to.

High export opportunity.

58

Inventory management Scope for further expansion in production of existing products and some new products has

increased.

4. THREATS

The company faces normal market competitions form other manufacturers and the unorganized

sector especially for the low value segment of industrial and bi-wheeler 2 stroke rings.

With the ongoing liberation of imports and deregulation of Indian economy, there is a major

threat from cheaper imports, particularly from China.

FINDINGS

After carrying out in depth study of the system and procedure of inventory management being

followed at FMGIL.

It has been found that in spite of high inventory levels so much care is taken off. There has

been a tremendous increase in the inventory levels.

59

Inventory managementNo consideration is given to maintain maximum and minimum levels of inventory. Economic

Order Quantity (EOQ) system is not followed properly in Escorts. Among ABC class items no special

care has been take of B and C class items although in absolute value the amount to crores of

investments. Crores of investment is becoming slow moving every year, which is turn is becoming

non-moving whose investment is already very high.

But a good thing is found in the form of MIS reports prepared on regular basis by Finance

Department to manage inventory level and review of slow and non moving items by all concerned

agencies on annual basis.

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Inventory management

SUGGESTIONS

The company employs very crude methods of inventory management, which involves high

manual labour and high ordering cost.

Proper information should be available for need of components for various assemblies at

various stages. If this analysis can be carried out by way of PERT and CPM techniques the delivery

schedules can staggered accordingly and lot of revenue can be generated by way of saving on account

of less inventory holdings and saving in inventory carrying costs.

Company should use ABC technique for inventory.

The company should have independent material engineering department or material-planning

department, which should plan about material requirement, purchases, planning of production.

The company should form realistic production programmed and there should not be frequent

changes in the same and it must be ensured that programs are made available well in time to all

concerned authorities along with data wise sequence of production.

Suppliers should be sent schedules in time especially for critical and a class items for purchase.

Comparison data of inventory level should be made available to different departments and they

should be encouraged to bring improvements so that inventory levels of company are made higher

than competitors.

Still better co-ordination should be there between stores, Finance Department and Purchase

Department to ensure better control over inventory.

A large part of the assets of company are tried up in this loan and advanced and it should try to

reduce its investments in this and should pool it in the capital investments.

It should try to promote its sales by starting their own marketing programmed at large scale

and face more competition.

61

Inventory management Standardization of tools can help to eliminate reluctant inventories through reduction in

inventory levels, which are increasing due to frequent changes in models of pistons etc.

Problems of past should be kept under consideration and inventory holding norms of well

established items should be thoroughly received, while fixing the new inventory norms.

Theoretically maintained levels should also be followed practically to stop inventory crossing.

This will make reduction in inventory levels possible.

The company needs to improve its inventory turnover ratio ensuring change of inventories to

sell at faster rate.

The company should try to increase its production by bringing in new technology and reducing

its cost.

The concern should try to pay more attention on raw material conversion period because by

this they can reduce the duration of manufacturing cycle for this they should try to reduce the raw

material inventory and also by increasing production.

In store and spares a part of inventory, there are certain items, which are slow moving, and

there are also certain items which are non moving. The firm should reduce the investment in these

items as the funds blocks in these can be efficiently utilized.

MRIR preparations may be restricted to 8 to 15 days. So that adverse insurance coverage and

over stocking implications could be avoided.

Earlier company was using wood boxes for packing finished goods, which were quite safe, and

a proper transportation. But now the company is using cardboard boxes for packing yet company has

reduced the weight of packing material per box. But quantity of rejected finished material in inventory

has increased. So company should give attention to improve packing material to maintain its

reputation and reducing cost of inventory.

62

Inventory management

BIBLIOGRAPHY

INTERNET WEBSITES:

Foundational work

• http://www.inventory management.com/inventory_management_blog.html• http://www.inventorymanagementreview.org/2005/10/different_inventory.html • http://www.inventorymanagement.com/labels/inventorymanagement.html

Comprehensive overview

• http://www.sageMAS_90_200_inventory_spec.pdf/22586.pdf• http://www.sba.gov/library/pubs/mp_22pdf • http://www.SKUflow.com/refferals.asp • http://www.inventorymanagement.review.org/2005/10/cutting _down_on.html • http://www.azinventory management.com/working_capital.html• http://www.azinventorymanagement.com/planning.html • http://www.azinventorymanagement.com/business_pages.html • http://www.answers.com/stock keeping units/reference.jsp

Theories

• Donald W.Dobler, David N. Burt, (2005), ” purchasing and Materials Management”, Inventory Management, pp -Z440-460.

63

Inventory management• Jain S.P, Narang K.L, (2001), “ materials control”, Cost Accounting, Kalyani Publishers,

Edition.16.

Questionnaire filling by organization employees to know about inventory management

Name AgeDesignationDepartment

1-which techniques used by your organization to control the inventory?

2-which methods are used by your organization for inventory management?

3 who prepared the MIS report of inventory in your organization and which basis it prepared?

4-inventory turnover ration of your organization?

5-level of inventory you kept your organization?

6-which categories the inventory of your organization classified?

7 Is your organization adopt EOQ model for inventory management or control?

8 how your organization maintain the level of inventory?

9-conversion period of inventory?

10-which is most appropriate method used by your organization for manage the inventory

Thank you

64

Inventory management

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