Inventory management technique aims at understanding and analyzing the layout planning of the plant, MULTIMECH ENGINEERS works, a manufacturing unit of pressure vessel, heavy equipment's.

2. PROJECT GUIDE:
Dr.T.Vijayakumar
MBA(HR),MBA(Finance),M.com,
MA(SoC),MSc(psy),ML,Ph.D.
PRESENTED BY:
S.VASANTH SAMUEL

3. Contents:
 Abstract
 Introduction
 Literature review
 Research methodology
 Data Analysis and Interpretation
 Findings
 Suggestions
 Conclusion
 Bibliography
 Appendix

5. • Inventory management technique aims at
understanding and analyzing the layout planning of
the plant, MULTIMECH ENGINEERS works, a
manufacturing unit of pressure vessel, heavy
equipments.
• The scope of inventory management also concerns the
fine lines between replenishment lead times, carrying
cost of inventory, asset management, inventory
forecasting, inventory valuation, inventory visibility,
future inventory price forecasting, physical inventory,
available physical space for inventory, quality
management, replenishment, returns and defective
goods and demand forecasting.

6. • As a part of inventory management, various inventory
management techniques are studied. Most of these are
being implemented in the plant (like ABC Analysis,
VED Analysis, and JIT etc.).
• Even those tools, which are not practically
implemented (like Vendor managed inventory,
Economic order quantity etc) are studied. These
methods, along with their working and importance,
are studied in detail.

8. INTRODUCTION
Inventory management and Supply chain
management are the backbone of any business
operations
A proper balance must be struck to maintain
proper inventory with the minimum financial
impact on the customer
Inventory control is the activities that
maintain stock keeping items at desired levels.

9. INDUSTRIAL PROFILE
FABRICATION INDUSTRY
Metal fabrication is the creation of Metal
structures by cutting, bending and
assembling processes.
It is a value-added process involving the
creation of machines, parts, and structures
from various raw materials.
 A fabricated product may be called a
fabrication, and shops specializing in this
type of work are called fabrication shops.

10. Multimech Engineers, are manufacturers &
suppliers of Industrial process equipment and
Fabrication, Pressure vessels, lethal vessels under
CCOE (Chief controller of explosive), petroleum &
explosive safety organization, Nagpur and also doing
under ASME section VIII, IS 2825 all amendment
with SMPV rules, Mechanical Engineering
Components in Coimbatore

11. Established in 2005, Multimech Engineers are
engaged in the manufacturing of
Pressure Vessels
Oil and Chemical Storage Tanks
Water Storage Tanks
Air Receivers
Heat Exchangers
Fabricated Valve Bodies & Vanes
Earth Moving Equipment Spares
Cement & Sugar Mills Components
Structural Fabrication & Heavy Equipments.

12. Many inventory problems are the result of
poor execution, poor communication and
poor decision making.
Large volume of inventory can lead to
management nightmares as they can cut into
your profits.
Due to lack of information in the inventory
could cause delay in the project completion
may let to loss of the good customer.

13. OBJECTIVES
To Study the Inventory Management
Techniques.
To Study the procedure of Implementation of
ABC Analysis.
To offer suitable suggestions for the
improvement of inventory management
practices.
Determination of the type of control required.
And to study the basic economic order quantity.

14. SIGNIFICANCE OF THE
STUDY
The main importance of this study of
integrated Material Management for better
Inventory Control.
Reduce cost of production in materials and
to improve profit of the company with
available project.
Utilization the resource very effectively.

15. SCOPE OF THE STUDY
Due to lack of facilities provided by organization,
people are not working efficiently and it has indirect
affect on their performance and outcome, so
 Working conditions
 Providing the development opportunities
 Helping skill development through training interventions
and planning.
 The scope of the study includes the ABC Analysis of Raw
Materials, work in progress and finished goods for four
financial years.
Through this the employee satisfaction level can be
increases & productivity also increases.

16. AREA AND PERIOD OF THE
STUDY
• The study have been gone through in onsite of
the company Multimech engineers at Annur
near Coimbatore district for short span of time
from January 28th to March 22nd. Study of
inventory Management techniques held in
every stage of warehouse.

17. LIMITATIONS
 Work responsibility & daily works.
 Process of planning & issue, ABC Analysis, Packing
supplier wise rejection.
 Just In Time.
 Wastes.
 Inventory Value of Plant & stores.
 Commodity wise inventory value.
 Types of Inventory.
 The study of receiving process of material, issue process,
dispatch process inventory control the process for all items.
 All the information regarding material was not disclosed
due to Company policy

18. LITERATURE REVIEW

19. Cheng (2013) proposes a multi-objective
production planning optimization model based on
the point of view of the integration of production
planning and control, in order to achieve
optimization and control of enterprise manufacturing
management.
Jha (2012)presents an overview of new
approaches in rapid product development in
production networks from design points of
view. Due to evolution of production
networks, it has become possible to obtain the
mass production within a key short time,
using emerging technology that affect the
speed and efficiency of product development.

21. RESEARCH DESIGN
A research design is purely and simply the frame
work or plane for a study that guides the collection and
analysis of data.
It is blue print followed in completing a study.
The research design specifies the methods, data
collection and data analysis.
A research design is an arrangement of conditions for
collection and analysis of data in a manner that aims to
combine relevance to the research purpose with
economy in procedure

22. METHOD & SOURCES OF
COLLECTION DATA
PRIMARY DATA
PRIMARY SOURCES OF
DATA
Observation Schedule and
Questionnaire
Interview

23. METHOD AND INSTRUMENT
OF COLLECTION
The Primary data are the information
generated to meet the lesser specific needs
of the investigation at hand.
Thus, the investigator has to collect, data
separately for the study undertaken. The
following are the three methods which are
used to compile primary data.
1. Observation
2. Schedule and questionnaire
3. Interview.

24. SAMPLING TECHNIQUE
Since the inventory stocks are
in different project simple random
sampling technique was used to
collect the data.

25. POPULATION SIZE
Population size is the total amount
of stocks items in the year 2015 to
2019 from the inventory of
Multimech engineers.

26. SAMPLE SIZE
The sample size taken for the survey
is 5 years (2015-2019) and the sampling
method used for the survey is simple
random sampling

27. ANALYTICAL TOOL
Statistical tools used for used for
data collection are
•ABC analysis.
•VED analysis.
•Economic order quantity.

28. DATA ANALYSIS AND
INTERPRETATION

29. ABC ANALYSIS
The concept ABC (Always Better Control) Analysis
is based on ‘Think on the Best and then on the Rest’.
ABC analysis underlines a very important principle
“Vital few: trivial many”.
 Generally, companies are required to keep stock of
large number of items used in production and
distribution.
Category
%
% of items
% of total cost
of materials
A 5 - 10 70 - 85
B 10 - 20 10 - 20
C 70 - 85 5 - 10

30. ECONOMIC ORDER OF QUANTITY
The economic order quantity can be determined with the help of
the following formula:
EOQ=
Raw materials in the term 2015-2019
2500
2000
1500
1000
500
0
Amount of
raw
materials in
Lakhs2015 2016 2017 2018 2019
Interpretation:
The above graph shows the amount of raw materials at cost. In 2015 the cost of
material is 274.94Rs increased in this year and in 20016-2017.It is more increased
to 1858.17 Rs and in 2018 it is increased to Rs2031.85 and in 2019 it is decreased
to 1768.52.

31. Stock in the term 2015-2019
20000
15000
10000
5000
Amount of stock in
process
0
2015 2016 2017 2018 2019
Interpretation
The above graph shows that work in progress at cost. In 2015 the cost of material is
2006.20Rs increased in this year and in 2016 it is decreased to Rs 82.67 in the year
2017 it is increased to 122.82and it is also maintained in the year 2018and in 2019 it is
nil.

32. Finished goods bar diagram
20000
15000
10000
5000
Amount of Finished
goods in Lakhs
0
2015 2016 2017 2018 2019
Interpretation
The above graph shows the amount of finished goods at cost. In 2015 the
cost of material is 2704.08Rs. It is increased to Rs6717.44 in the year 2016..It is
increased in the year 2017-18the cost of goods is Rs 1,6880.69 and in the year 2019 it
is decreased to 7443.66.

33. Amount of cost of stores and spares bar diagram
200000
150000
100000
50000
Amount of cost of
stores and spares in
lakhs
0
2015 2016 2017 2018 2019
Interpretation
The above graph shows the amount of stores and spares at cost. In 2015the
consumable is Rs673.25 and it is highly increased to Rs 1628.44 in the year
2016.The form maintains goods in proper way Rs 3617.38 in the year 2017 and it is
decreased to Rs 3539.05 in the year 2018 and in the year 2019 it is decreased to
973.02.

34. Raw material consumption bar diagram
200000
150000
100000
50000
Amount of Raw
material consumed
in Lakhs
0
2015 2016 2017 2018 2019
Interpretation
The above graph shows consumption of raw materials .The consumption of
raw material in the year 2015 is Rs65875.45 the consumption of raw material
increased in the year 2016-17 in the Rs172305.70. And it is decreased to
Rs 16,969,736,368 in the year 2018 and it decreased to Rs 3, 8607.65 in the year
2019.

35. FINDINGS
In review this internship has been an excellent and rewarding experience. I have
been able to meet and network with so many people that I am sure will be able to help
me with opportunity in the future.
•It is found that some items are misplaced.
•Keeping every item in its assigned place.
•It is found that there are some codification errors.
•Easy and prompt issue and receipt of items.
•Keeping items in an orderly fashion.
•Providing production against damage and pilferage.
•Issuing oldest material first.
•Inventory is managed by ABC analysis, problem is occurred as stock of A items is
less as it carries more amount, Sometimes if Supplier is not available at time of
requirement of A items it may lead to stop whole production line also.
•Inventory is managed following ABC analysis; it is based on monetary value of the
items in use. So the other important factors one ignored.
•Providing enough space and storage equipment like alarmist, shelves, racks, bins etc.
•Having regular programmer of inspection, physical verification and maintenance of
Store.

36. SUGGESTION
•Recording level is not proper. This leads to increased inventory on shop floor. Proper
monitoring and reordering of data is to be done on shop floor.
•Inventory Management should be done not only on the basis of cost or monetary
value of items in use other factors should also be considered like availability, lead
time, sources of supply etc.
•Company should search Local Supplier.
•The Delivery Schedule must be transparent.
•Company should follow Vendor Development Techniques.
•Stock records must be reconciled periodically with physical balance.
•Optimize inventory levels through effective deployment of system like KANBAN/
JIT.
•Inventory optimization tools have been gaining ground as companies seek to
evaluate their entire network and determine the best inventory policies for each
product at each node in their supply chain. There are typically standalone software
tools that use data from Warehouse Management System (WMS)
•Mobile devices allow quick access to accurate information and data so that managers
can act quickly on their inventor decisions(Example :SAP)

37. CONCLUSION
 Inventory management has to do with keeping accurate records of finished
goods that are ready for shipment.
 Highly trained Inventory management and high-quality software will help
make Inventory management a success.
 MULTIMECH ENGINEERS has truly changed the face of manufacturing and
transformed the global economy. MULTIMECH ENGINEERS is both a
philosophy and collection of management methods and techniques used to
eliminate waste (particularly inventory) The Company’s Inventory management is
effective, company should make a classification of its inventory in minimum
categories.
 Inventory management is important for keeping costs down, while meeting
regulation.

38. BIBLIOGRAPHY
Books
M. Pandey, Financial Management, Vikas Publishing Pvt, Ltd, (9th Edition)
Logistics and Supply Chain Management - D K Agrawal
Inventory Management - L C Jhamb
Automation , Production systems, Computer Integrated Manufacturing - Mikell
P, Groover
Warehouse Management - Gwynne Richards
Inventory Accuracy - David J Piasecki
Websites
http://www.jkfilesandtools.com
http://www.google.com [http://www.google.com/]
http://www. [http://www.fertilizers1.com/institutions.html]
http://www.moneycontrol.com
[http://www.moneycontrol.com/gnfc/financials.html]
http://www.slideshare.net [http://www.slideshare.net/]
http://www.wikipedia.com

39. APPENDIX
QUESTIONNAIRE
To collect the data about inventory techniques in Multimech Store, I asked
some questions to the store manager and store keepers. Some of the data were kept
confidential to maintain the company’s privacy.
QUESTIONNAIRUE
How do you determine ordering frequency?
What is your inventory counting procedure?
How do you eliminate excess or obsolete inventory?
Is your storage area well-staffed?
Do you apply the above practices to all parts of your inventory (finished goods,
raw material, works in process and spare parts) and in all organizational entities?
Who determines the optimal frequency for producing or ordering products?
Who manages the on-site inventory?