This document summarizes logistics challenges faced by Gujarat Engineering Company Limited (GECL) in managing outbound logistics. GECL relies on road transport for 67% of outbound logistics and rail for 33%. Key issues include high failure to deliver on time (87% for 15-ton trailers), average capacity utilization of only 75%, and long yard turnaround times of 52 hours. The document analyzes GECL's logistics operations and relationships with transport providers. It recommends strategies like rewarding on-time deliveries, increasing average capacity utilization, outsourcing yard management, and restructuring ERP systems to improve outbound logistics management.

1. GUJARAT ENGINEERING COMPANY
LIMITED
Submitted by:
Rajkamal Roy(15-50-133)
Rakesh Singh(15-50-131)
Ganggin kuki(15-50-138)
Mohammed Hussain Nawaz(15-50-140)
Managing Outbound Logistics Challenges

2. Brief about the company
Engineering Company
Products
Electrostatic precipitators Auxiliary Equipment's
Pre heaters Industrial fans
Annual Revenue : 7.2 Bn Annual Profit : 1.8 Bn
Vadodara, Gujarat
Strategic location for supply to industrially
developed states like Maharashtra and
Gujarat. It also facilitates access to Gujarat
port services for international exports

3. GECL Departments
Material Planning Department (MPD)
Responsible for material requirement planning , purchasing and allocating
material to internal customers
Production Department
Outsourcing support Department (OSD)
Responsible for outsourcing the
component manufacturing
Internal Factory
• Internal manufacturing
• Value added components

4. OSD receives
confirmation of product
for delivery
Commercial Department
confirms dispatch
schedule
On confirmation from
customer , GECL
commercial department
informs transport
department
Delivery is managed
through listed transport
owner / Local
transporters
Items are delivered
GECL logistics operation structure

5. GECL Logistics pattern
GECL
Inbound logistics from suppliers Outbound logistics to customers
• 67 % done through Roadways
including the Over dimensional
Cargos
• 33 % is done through Railways
Outbound Logistics trends
• 73% vehicles used were 15 Tons trailers
• 87% of 15 Ton trailers failed to deliver on time
• Average capacity Utilization = 75% of all vehicles , 65% for 15 Tons trailers
Yard Problem
• Limited Yard space due to rapid business growth
• High turnaround time (Average 52 hours)

6. Questions Asked

7. • Ownership pattern of vehicles
• Incremental pattern generation in market
• Mismatch between the contractual terms and service
provider
• Payment to service providers
• Less Average capacity utilization
• Poor material segregation
Strategically Issues faced by GECL

8. Operation issues affecting the organic growth
• Outbound logistics inside the yard was affecting the delivery time
• Poor adherence was leading to problems related to material identification and
tracking
• Failure to deliver on time Outsourcing of Material handling work to transport
owners
• Mismatch in the definition of Other Dimension Cargo (ODC) , as per contractual
terms
This resulted in
• Increased cost of Logistics
• Inability to supply the products to customer
(Vehicle demand : 741 , vehicles placed : 371 (81% on time and 19% late delivery)
• Poor MH productivity affecting dispatch problems

9. Alliance spectrum
Alliance with the service providers : The Transport agencies
• Regular truck operation with guaranteed mileage and volume assurance
• Providing reasonable advances to the service providers when the trucks
are on the road
• Better dispatch plan to increase the average utilization capacity (currently
75%)
• Encourage on time delivery . On the basis of it , bonus payments can be
made.
• Emphasis on reduction on turnaround time in the yard.

10. • Modification in commercial department and common information sharing
platform. Base capacity should be fixed at 18 Tons (As transporters were
moving towards higher capacity vehicles)
• Better dispatch plan
• Explore scope of taking up additional temporary yards.
• Categorization of Other Dimension Cargo(ODC) and subsequent payment
for it.
• Logistics department should outsource the complete work to 3rd Party
logistic services (Handling both listed and local service providers)
• Revising Transport Rates and encouraging on time deliveries.
• Direct delivery from Sub contractors and vendors after quality check
• Functioning of Enterprise resource Planning (ERP) should be restructured.
Suggestions