The document is a dissertation by Sagardwip Dey submitted to Assam University, focusing on the inventory management strategies employed by Amul, specifically within Silchar. It discusses the importance of effective inventory control, the challenges faced by distributors and retailers, as well as the theoretical frameworks surrounding inventory management techniques. The study aims to provide insights and suggestions for improving inventory strategies to enhance operational efficiency and customer service.

1. INVENTORY STRATEGY FOR PROCESSING INDEPENDENT
DEMAND
(A Study on Amul)
Dissertation Submitted to Assam University, Silchar for the award of the
Degree of Business Administration
By
SAGARDWIP DEY
Under the guidance of
DR D. GHOSH
DEPARTMENT OF BUSINESS ADMINISTRATION
JN SCHOOL OF MANAGEMENT STUDIES
ASSAMUNIVERSITY
SILCHAR – 788 011, INDIA
MAY 2012

2. DEPARTMENT OF BUSINESS ADMINISTRATION
ASSAMUNIVERSITY
(A CentralUniversity)
SILCHAR-788011 (Assam)
: 03842-270200, 270847
Dr .D.Ghosh
CERTIFICATE
I certify that the work entitled “INVENTORY STRATEGY FOR PROCESSING
INDEPENDENT DEMAND” written and submitted by Sri Sagardwip Dey in partial
fulfillment of the requirement for the Degree of Master of Business Administration
is a work by him. Sri Sagardwip Dey is a very hard working and sincere student.
Dated, Silchar (DebomalyaGhosh)
The 16th May, 2012
4

3. Preface
I SAGARDWIP DEY declare that the project report titled “INVENTORY STRATEGY
FOR PROCESSING INDEPENDENT DEMAND” in Amul Silchar, carried out by me
under the supervision of Dr.D.Ghosh is the result of the original work done by me.
To the best of my knowledge and belief this report would not be submitted to any
other institution apart from Department of Business Administration of Assam
University or any other organization for using any purposes.
My special thanks are to Mr. Ajay Agarwal& my friends who helped me a lot in data
collection and their encouragement in the successful completion of my work.
For the Purpose of the research I have visited Amul’s warehouse, distributor &
retailers
Dated, Silchar (Sagardwip Dey)
The 16th May 16, 2012
5

4. INDEX
ChaptersPage no.
INTRODUCTION 6-7
Introduction of study 7
Objectives of study 7
Scope of study 7
CONCEPTUAL & THEORITICAL FRAME 8-19
Meaning & definition of inventory 9
Classification of inventory 9
Risk & cost associated with inventory 9
Understanding inventory management 11
Historical review of inventory management 12
Types of inventory 13
Inventory cost 14
Purpose of inventory management 15
Benefits of inventory management 15
Inventory control techniques 16
ORGANIZATION PROFILE20-50
Introduction 21
Organization overview 25
Organization structure 28
Production function 30
Operation analysis 30
Amul supply chain 33
Plant 34
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5. Amul products 36
Amul product history 50
RESEARCH METHODOLOGY 51-53
Research meaning 52
Research design 52
Nature of data 52
Research type 53
Sampling size & technique 53
DATA ANALYSIS & INTERPRETATION 54-92
Inventory movement data 55
Findings 91
Suggestions 92
Conclusion 92
APPENDIX 93-99
BIBILOGRAPHY 100-101
7

6. CHAPTER – 1
INTRODUCTION
8

7. INTRODUCTION OF THE STUDY
This study is about the inventory management of Amul in Silchar town. Every
enterprise needs inventory for smooth running of its activities. It serves as a link between
the production and distribution process. The greater a time lag, the higher the requirement
of inventory the unforeseen fluctuation of inventory demand and supply of goods,
fluctuating inventory prices, necessitate the need for inventory management.
The investment inventory constitutes the most significant part of the current
assets inventory of the under taking. Thus it is very essential to have a proper control and
management of inventory. Inventories cost account for nearly 55 percent of the cost of
production, as it is clear from an analysis of financial statements of large number of
private and public sector organizations. So, it essential to establish suitable procedures for
proper control of materials from the time of purchase order placed with supplier until
they have been consumed properly.
This study is about how the distributors are managing their inventory, what are
the problems they are facing and what are the inventory techniques they are using to
maintain the inventory level.
OBJECTIVE OF THE STYDY
To understand the practical concept of Inventory Management &and analyze the
management technique used in managing the inventory.
To find the problems faced by retailers & distributors in selling and storing.
To collect the information about the movement of Inventory in the lower leg.
SCOPE OF THE STUDY
The study carried out in Silchar city so its scope is mainly limited to Silchar city.
It gives information about the size of the retail network.
It gives information about the services given by distributor to their retailer
It will served retailer &consumer in better manner.
It provides suggestions to the company to improve their inventory strategy.
9

8. CHAPTER – 2
CONCEPTUAL & THEORITICAL FRAME
10

9. MEANING AND DEFINITION OF INVENTORY
The term inventory is originated from the French word Inventaire and the Latin
Inventariom which implies a list of things found. The term “inventory” has a wider
meaning then the term “Materials” or “store”.
According to the “Institute of Chartered Accountant of India” inventory means
“Tangible Property” held
a) For sale in the ordinary course of business.
b) In the process of production for sale.
c) For rendering of services.
The term inventory refers to the stockpile of the products a firm is offering for sales and
the components that make up the product. Inventories are the stocks of the product of a
company, manufacturing for sale and the components that make up the product.
The various forms in which inventories exist in manufacturing company are (1) raw
material (2) work-in process, (3) finish goods and (4) store and spares. However, in
commercial parlance, inventory usually includes store, raw material, work-in process and
finish goods. The term inventory includes – raw material, work-in process, finish goods
packaging, spares and others stocked in order to meet an unexpected demand or
distribution in the future.
CLASSIFICATION OF INVENTORIES
Classificationof Inventory
Production Work-in Progress Finished goods MRO inventory
Inventory
1. Production Inventory
In production inventory there are two types of productioninventory that are as follows:
a) Material, which are purchases from the market like raw material and readymade
Parts & components require for manufacturing of equipment.
11

10. b) Special part or component manufactured in once own company & kept in stock for
uses in manufacturing.
2. Maintenance RepairOperating supplies (MRO Inventory)
There are material purchase from vendor & require for Maintenance or production
process.
3. Work in progress
There are semi-finished products in various stages of production on the factory floor.
4.Finished goods inventory
These consist of manufactured kept in warehouses or retail outlets & are meet for sale.
RISKS & COST ASSOCIATED WITH INVENTORIES
Holding of inventories exposes the firm to a number of risks & costs. Risk of holding
inventories can be put as follows:-
i) Price decline
This may be due to increase in the market supply of the product, introduction of
a new competitive product price-cutting by the competitors etc.
ii) Product deterioration
This may be due to holding a product for too long a period for too long a period
or improper storages condition.
iii) Obsolescence
This may be due to change in customer‟s taste, new production technique
improvements in the product design, specifications etc.
THE COSTS OF HOLDING INVENTORY
i) Material costs
This includes the cost of purchasing the goods, transportation and handling
charges less any discount allowed by the supplier of goods.
ii) Ordering costs
This includes the variable cost associated with placing an order for the goods.
The fewer the orders lower will be the ordering costs for the firm.
iii) Carrying cost
This includes the exposes for storing the goods. It comprises storage costs,
insurance costs, spoilage costs, cost of funds tied up in inventory.
12

11. Understanding inventory management
Every management problem is a decision problem. Decision is an important task that all
organizations have to take. The allocation of resource is a common issue to all
organizations. Organizations have to acquire, allocate and control the factors of
production which are necessary for the achievement of the business‟s objectives.
Inventory management as one of the key activities of business logistics, has always been
a major preoccupation for the company‟s survival and growth.
The aim of inventory management is to hold inventories at the lowest possible cost, given
the objectives to ensure uninterrupted supplies for ongoing operations. When making
decisions on inventory, management has to find a compromise between the different cost
components, such as the costs of supplying inventory, inventory-holding costs and costs
resulting from insufficient inventories
According to Wild inventory control is the activity which organises the availability of
items to the customers. It coordinates the purchasing, manufacturing and distribution
functions to meet the marketing needs. This role includes the supply of current sales
items, new products, consumables; spare parts, obsolescent items and all other supplies.
Inventory enables a company to support the customer service, logistic or manufacturing
activities in situations where purchasing or manufacturing of the items is not able to
satisfy the demand. Lack of satisfaction could arise either because of the speed of
purchasing or manufacturing is too protracted, or because quantities cannot be provided
without stocks. Clodfelteradds that a good inventory control system offers the following
benefits:
a) The proper relationship between sales and inventory can better be well maintained.
Without inventory control procedures in place, the store or department can become
overstocked or under stocked.
b) Inventory control systems provide a business with information needed to take
markdowns by identifying slow-selling merchandise. Discovering such items early
in theseason will allow a business to reduce prices or make a change in marketing
strategybefore consumer demand completely disappears.
c) Merchandise control systems allow buyers to identify best-sellers early enough in
theseason so that re-orders can be placed to increase total sales for the store or
department.
d) Merchandise shortages and shrinkage, can be identified using inventory
controlsystems. Excessive shrinkage will indicate that more effective
merchandising controlsneed to be implemented to reduce employee theft or
shoplifting.Emphasizing the pertinence of the topic, in 2001, Gourdin noted that
„inventory is onearea of logistics that has received a great deal of management
attention over the pastdecade. Executives now realize that holding excessive
stocks is simply too expensive.Therefore, a great deal of effort has been expended
to eliminate unnecessary inventorywithout compromising customer service.
However, there are numerous situations whereinventory simply must be held,
particularly when meeting the needs of global customers.
13

12. Management‟s goal should be to hold only what is necessary to satisfy customer
requirements and manage it effectively‟ (Gourdin 2001:82).
Inventory problems preoccupy profit- making organizations and nonprofit institutions as
well. Inventories are common to agriculture, manufacturers, wholesalers, retailers,
hospitals, churches, prisons, zoos, universities and national, state and local governments.
Indeed, inventories are also relevant to the family unit in relation to clothing,
pharmaceutical products, food and so forth. This indicates how inventories are important
and deserve a serious attention in order to achieve organizational objectives.
Historical review of inventory management
Historically, inventory management has often meant too much inventory and too little
management or too little inventory and too much management. There can be severe
penalties for excesses in either direction. Inventory problems have proliferated as
technological progress has increased the organization‟s ability to produce goods in
greater quantities, faster and with multiple design variations. The public has compounded
the problem by its receptiveness to variations and frequent design changes .since the mid-
1980s the strategic benefits of inventory management and production planning and
scheduling have become obvious. The business press has highlighted thesuccess of
Japanese, European, North American firms in achieving unparalleled effectiveness and
efficiency in manufacturing and distribution. In recent years, many of the firms have
„raised the bar‟, yet again by coordinating with other firms in their supply chains. For
instance, instead of responding to unknown and variable demand, they share information
so that the variability of the demand they observe is significantly lower
Silver, Pyke and Peterson continue arguing that in the United States of
America and other Western Countries, productivity improvement was pursued through
reducing the amount of direct manufacturing labour expended per unit of output. This
was a valid strategy because of the high labour content in many manufactured products.
However, the proportion of unit cost due to labour has been steadily decreasing in recent
years. In fact, the ratio of purchased materials to sales (in dollars) reached 60 percent for
U.S. firms in 1985. Even large manufacturing firms, such as the U.S auto assemblers,
purchase up to 60 percent of the value of the product. This implies that management of
raw materials inventories is an area that shows great promise for productivity
improvement. Japanese firms received much deserved attention in the mid-to late 1980s
because of their remarkable performance on quality and inventory management. The
tremendous interest in Just-in-Time manufacturing (JIT) indicates that work-in-process
inventory management is also an area ripe for improvement.
14

13. Types of inventory
According to Stock and Lambert, inventories can be categorized into six distinct forms
that are:
a) Cycle stock. Cycle stock is inventory that results from the replenishment process
and is required in order to meet demand under conditions of certainty, that is,
when the firm can predict demand and replenishment times (lead times) almost
perfectly. For example, if the rate of sales for a constant 20 units per day and the
lead time is always 10 days, no inventory beyond the cycle stock would be
required. While assumptions of constant demand and lead time remove the
complexities involved in inventory management, let‟s look at such an example to
clarify the basic inventory principles.
b) In-transit inventories. In-transit inventories are items that are en route from one
location to another. They may be considered part of cycle stock even though they
are not available for sale and /or shipment until after they arrive at the destination.
For the calculation of inventory carrying costs, in-transit inventories should be
considered as inventory at the place of shipment origin since the items are not
available for the buyer, sale, or subsequent reshipment.
c) Safety or buffer stock. Safety or buffer stock is held in excess of cycle stock
because of uncertainty in demand or lead time. The notion is that a portion of
average inventory should be devoted to cover short-range variations in demand
and lead time. Average inventory at a stock-keeping location that experiences
demand or lead time variability is equal to half the order quantity plus the safety
stock.
d) Speculation stock. Speculation stock is inventory held for reasons other than
satisfying current demand. For example, materials may be purchased in volumes
larger than necessary in order to receive quantity discounts, because of a
forecasted price increase or materials shortage, or to protect against the possibility
of a strike.
e) Seasonal stock. Seasonal stock is a form of speculative stock that involves the
accumulation of inventory before a season begins in order to maintain a stable
labour force and stable production runs or, in the case of agricultural products,
inventory accumulated as the result of a growing season that limits availability
throughout the year.
15

14. f) Dead stock is inventory that no one wants, at least immediately. The question is
why any organization would incur the costs associated with holding these items
rather than simply disposing of them. One reason might be that management
expects demand to resume at some point in the future. Alternatively, it may cost
more to get rid of an item that it does to keep it. But the most compelling reason
for maintaining these goods is customer service. Perhaps an important buyer has
an occasional need for some of these items, so management keeps them on hand as
a goodwill gesture.
Inventory costs
According to Gourdin there are three types of costs that must be considered in setting
inventory levels.
a) Holding (or carrying) costs are costs such as storage, handling, insurance, taxes,
obsolescence, theft and interest on funds financing the goods. These charges
increase as inventory levels rise. In order to minimize carrying costs, management
makes frequent orders of small quantities. Holding costs are commonly assessed
as a percentage of unit value, i.e. 15 percent, 20 percent, rather than attempting to
derive a monetary value for each of these costs individually. This practice is a
reflection of the difficulty inherent in deriving a specific per-unit cost for, for
example, obsolescence or theft.
b) Ordering costs are those costs associated with placing an order, including expenses
related to personnel in a purchasing department, communications and the handling
of the related paperwork. Lowering these costs would be accomplished by placing
a small number of orders, each for a large quantity. Unlike carrying costs, ordering
costs are generally expressed as a monetary value per order.
c) Stock-out costs include sales that are lost, both short and long term. These charges
are probably the most difficult to compute, but arguably the most important
because they represent the costs incurred by customers (internal or external) when
inventory policies falter. Failure to understand these costs can lead management to
maintain higher (or lower) inventory levels than customer requirements may
justify.
16

15. PURPOSE OF INVENTORY MANAGEMENT
1. To maintain independence of operations
 Provide “optimal” amount of cushion between work centers
 Ensure smooth work flow
2. To allow flexibility in production scheduling
3. To meet variation in product demand
4. To provide a safeguard for variation in raw material or parts delivery time
 Protect against supply delivery problems (strikes, weather, natural disasters, war,
etc.)
5. To take advantage of economic purchase-order size
BENEFITS OF INVENTORY MANAGEMENT
1. Reduced stocking costs resulting from efficient matching of requirements to stock
2. Re-order recommendations highlight urgent needs. Help prevent Stock-outs.
3. Instant access to 24 month usage pattern aids decision making reveals trends. Old
data easily purged.
4. Automatic capture on audit trail of all stock movement details helps resolve
5. Instant month-end valuation of receipt, issues adjustment etc.
6. Rapid stock and work-in progress evaluation.
7. True multi-location without constraints.
8. Easy monitoring of slow moving stocks.
9. Automation of inventory checking cycles ensures that items are not forgotten.
Improves accuracy
10. Automatic tracking of scrap rates and recalculation of safety levels reduces effort,
improves control
11. ABC analysis system focused attention on high value stock holdings.
17

16. INVENTORY CONTROL TECHNIQUES
Inventory control techniques are employed by the inventory control organization within
the framework of one of the basic inventory models, viz. Fixed order quantity systems
or fixed order period system. Inventory control techniques represent the operational
aspect of inventory management and help realize the objectives inventory management
and control.
Several techniques of inventory control are in use and it depends on the
convenience of the firm to adopt of the techniques. What should be stressed,
however, is the need to cover all items of inventory and all stages, i.e. from the stage of
receipt from supplies to the stage of their use.
The techniques are most commonly used are the following,
Economic Order Quantity (EOQ)
Continuous Review
Periodic Review Systems
Hybrid system
Economic Order Quantity (EOQ)
How much to order –
Major decision area where focus on decision regarding how much Quantity to order at a
time is important case of inventory management. Number of techniques has been
developed to help managers in this decision. Most widely used technique is “Economic
order Quantity”. This represents the size of an order for which the total cost is
minimum economy in purchasing.
Total cost for this purpose consist 2 major costs –
a) Ordering cost or procurement cost.
b) Carrying / Holding cost. Where,
These two types of cost are opposed to one another. The ordering cost decrease
while carrying cost increases with every increase in Qty of purchase order. So the
management has to take decision that there will be balance between 2 opposing cost to
have EOQ with minimum total cost.
How to calculate EOQ:-
1) Mathematical approach – calculate by formula.
2 AB
EOQ = -------- (in units)
C ×S
Where,
18

17. A = Annual usage in units
B = Cost of placing an order
C = cost per unit
S = Carrying cost as a percentage of Aug inventory.
If EOQ determined in terms of rupees where annual usage expressed in rupees by
formula
Annual usage = annual usage unit × unit cost.
Continuous Review
A continuous review (Q) system, sometimes called a reorder point (ROP) system or
fixed order-quantity system, tracks the inventory of an item each time withdrawal is
made to determine whether it is time to reorder. In practice, these reviews are done are
done frequently and are often continuous. At each review, a decision is made about an
item‟s inventory position. If it is judged to be too low, the system triggers a new order.
Inventory Position= On-Hand inventory + Scheduled receipt – Backorders
IP = OH + SR – BO
When demand is certain
When demand & lead time are constant. The downward-sloping line represents the on-
hand inventory, which is being depleted at a constant rate. When it reaches reorder
point, a new order is placed. The on-hand inventory continues to drop throughout lead
time until the order is received. At that time, this marks the end of the lead time, on
hand inventory jumps up. A new order arrives just when the inventory drops to 0. The
time between orders is the same for each cycle.
IP IP
IP
Order
received
On Q
Q Q
-
ha
nd OH
inv
ent
Order
ory
Placed
L L L
Time
TBO TBO TBO
L L L 19

18. When demand is uncertain
In reality demand & lead times are not always predictable. This system operates when
demand is variable and uncertain. We assume that the variability in lead times is
negligible and, therefore, can be treated as constant. The wavy downward-sloping line
indicates the demand varies from day to day. Its slope is steeper in the second cycle,
which means the demand rate is higher during this time period. The changing demand
rates means the time between order changes, so TBO1≠TBO2≠TBO3. Because of
uncertain demand, sales during lead time are unpredictable, and safety stock is added to
hedge against lost sales. This addition is why re-order level is higher in this than the re-
order level of certain demand.
Periodic review system
An alternative inventory control system is the periodic review (P) system, sometimes
called a fixed interval recorder system or periodic record system. In this system an
items inventory position is received periodically rather than continuously.
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19. Hybrid Systems
Various hybrid inventory control systems merge some but not all features of the P & Q
systems. There are two types
Optional Replenishment System
Base-stock system
Optional Replenishment System
It is used to review the inventory position at fixed time interval and, if the position has
dropped to (or below) a predetermined level, to place a variable size order to cover
expected needs.
Base-stock system
In this system replenishment order is issued each time when withdrawal is made, for the
same amount of withdrawal.
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20. CHAPTER – 3
ORGANIZATION PROFILE
22

21. AMUL means "priceless" in Sanskrit. A quality control expert in Anand
suggested the brand name “Amul,” from the Sanskrit “Amoolya,” Variants, all meaning
"priceless", are found in several Indian languages. Amul products have been in use in
millions of homes since 1946. Amul Butter, Amul Milk Powder, Amul Ghee, Amulspray,
Amul Cheese, Amul Chocolates, AmulShrikhand, Amul Ice cream, NutrAmul, Amul
Milk and Amulya have made Amul a leading food brand in India. Today Amul is a
symbol of many things. Of high-quality products sold at reasonable prices, of the genesis
of a vast co-operative network, of the triumph of indigenous technology, of the marketing
savvy of a farmers' organization and have a proven model for dairy development.
Symbol of Amulis a ring of four hands, which are coordinated each other .The
actual meaning of this symbol is coordination of hand of different people by whom this
union is now at top.
First hand is for the farmers (producers), without whom
the organizationwould do not existed. Farmers are the
inspiration of the AMUL – the taste ofIndia.
Second hand is for the representatives of processors by
whom the raw milkprocessed into different finished
products.
Third hand is for marketers without whom the product
would have not been able toreach to the customer.
Fourth hand is for customers without whom the
organization could not carry onbecause they are the
people who consume the product. The union of
Amulwould nothave been the second biggest successful
company in the world without thecoordination of the above four hand
The Birth of Amul
Milk, The inspiration behind a revolution
Over six decades ago the life of a farmer in Kaira was very much like that of
farmers anywhere else in India. His income was derived almost entirely from
seasonal crops. Many poor farmers faced starvation during off-seasons. Their
income from milch buffaloes was undependable. The milk marketing system
was controlled by contractors and middlemen. As milk is perishable, farmers
were compelled to sell their milk for whatever they were offered. Often they
had to sell cream and ghee at a throwaway price.
23

22. They were in general illiterate. But they could see that the system
under which contractors could buy their produce at a low price and
arrange to sell it at huge profits was just not fair. This became
more noticeable when the Government of Bombay started the
Bombay Milk Scheme in 1945. Milk had to be transported 427
kilometers, from Anand to Bombay. This could be done only if
milk was pasteurized in Anand.
After preliminary trials, the Government of Bombay entered into an
agreement with Polsons Limited to supply milk from Anand to Bombay on a
regular basis. The arrangement was highly satisfactory to all concerned –
except the farmers. The Government found it profitable; Polsons kept a good
margin. Milk contractors took the biggest cut. No one had taken the trouble to
fix the price of milk to be paid to the producers. Thus under the Bombay
Milk Scheme the farmers of Kaira District were no better off ever before.
They were still at the mercy of milk contractors. They had to sell their milk at
a price the contractors fixed. The discontent of the farmers grew. They went
in deputation to Sardar Patel, who had advocated farmers‟ co-operatives as
early as 1942.
Sardar Patel reiterated his advice that they should market their milk
through a co-operative society of their own. This co-operative should
have its own pasteurization plant. His advice was that the farmers
should demand permission to set up such a co-operative. If their
demand was rejected, they should refuse to sell their milk to
middlemen.
Sardar Patel pointed out that in undertaking such a strike there should
be some losses to the farmers as they would not be able to sell their
milk for some time. If they were prepared to put up with the loss, he
was prepared to lead them. The farmers‟ deputation readily accepted
his proposal.
Sardar then sent his trusted deputy, Mr. Morarjibhai Desai, to
Kaira District to organize milk co-operative – and a milk strike if
necessary. Mr. Desai held a meeting in Samarkha village on
January 4, 1946. It was resolved that milk producers‟ co-
operative societies should be organized in each village of Kaira
District to collect milk from their member-farmers. All the milk
societies would federate into a Union which would own milk
processing facilities. The Government should undertake to buy
milk from the Union. If this wasn‟t done, the farmers would
refuse to sell milk to any milk contractor in Kaira District.
24

23. The Government turned down the demand. The farmers called a „milk
strike‟. It lasted 15 days. Not a drop of milk was sold to the milk
merchants. No milk reached Bombay from Anand, and the Bombay
Milk Scheme almost collapsed. After 15 days the milk commissioner
of Bombay, an Englishman, and his deputy visited Anand, assessed
the situation and accepted the farmers‟ demand.This marked the
beginning of the Kaira District Co-
operative Milk Producers‟ Union Limited,
Anand. It was formally registered on
December 14, 1946. Its objective was to
provide proper marketing facilities for the
milk producers of the district. The Union
began pasteurizing milk in June 1948, for
the Bombay Milk Scheme – just a handful of farmers in two village
co-operative societies producing about 250 liters a day.
An assured market proved a great incentive to the milk producers
in the district. By the end of 1948, 432 farmers had joined village
societies, and the quantity of milk handled by the Union had
increased to 5000 liters a day.
In the early stages, rapid growth brought in its wake serious
problems. Their solution provided the stimulus for further growth.
For example, as the co-operative movement spread in the district, it
was found that the Bombay Milk Scheme could not absorb the
extra milk collected by the Union in winter, when buffaloes
yielded an average of 2.5 times their summer yield. Thus by 1953,
the farmer-members had no regular market for the extra milk
produced in winter. They were again forced to sell a large surplus
at low rate to middlemen.
The only remedy was to set up a plant to process the extra milk into products like butter and milk
powder. The logic of this step was readily accepted by the Government of Bombay and the
Government of India, except for a few doubting Thomases. The government of India helped the
Union to get financial help from UNICEF and assistance from the Government of New Zealand
under the Colombo Plan. Technical aid was provided by F.A.O. A Rs.50 – lakh factory to
process milk powder and butter was blueprinted. Its foundation stone was laid by the then
President of India the late Dr. Rajendra Prasad on November 15, 1954. The project was
completed by October 31, 1955, on which day the late Pandit Jawaharlal Nehru, the then Prime
Minister of India, declared it open. The new dairy provided a further fillip to the co-operative
movement among milk producers. The union was thus enabled to organize more village co-
operative societies and to handle more and more milk each year. This event also brought a
breakthrough in dairy technology as the products were made processing buffalo milk for the first
time in the world. Kaira Union introduced the brand “Amul” for marketing its product range.
The word “Amul” is derived from Sanskrit word „Amulya‟ which means „priceless‟ or precious‟.
In the subsequent years Amul made cheese and baby food on a large commercial scale again
processing buffalo milk creating a history in the world.
25

24. 1964 was the turning point in the history of dairy development
program in India. Late ShriLalBahadurShastri, the then Prime
Minister of India who visited Anand on 31s October for
inauguration of Amul‟s Cattle Feed Plant, having spent a night with
farmers of Kaira and experiencing the success wished and
expressed to MrKurien, then the General Manager of Amul that
replicating Amul model throughout our country will bring a great
change in the socio-economic conditions of the people. In order to
bring this dream into reality, 1965 The National Dairy Development
Board (NDDB) was established at Anand and by 1969-70 NDDB
came out with the dairy development program for India popularly
known as “Operation Flood” or “White Revolution”. The Operation
Flood program, even today, stands to be the largest dairy
development program ever drawn in the world. This saw Amul as
model and this model is often referred in the history of White
Revolution as “Anand Pattern”. Replication of “Anand Pattern” has
helped India to emerge as the largest milk producing nation in the
world.
The Amul Model
The Amul Model of dairy development is a three-tiered
structure with the dairy cooperative societies at the village
level federated under a milk union at the district level and a
federation of
Establishment of a direct linkage between milk
producers and consumers by eliminating member
unions at the state level. Middleman.
Milk Producers (farmers) control procurement,
processing and marketing
26

25. The Amul model has helped India to emerge as the largest milk producer in the world.
More than 13 million milk producers pour their milk in 1, 28,799 dairy cooperative
societies across the country. Their milk is processed in 176 District Co-operative Unions
and marketed by 22 State Marketing Federations, ensuring a better life for millions.
The Organization – An Overview
GCMMF Overview:
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food
products marketing organization. It is a state level apex body of milk cooperatives in Gujarat
which aims to provide remunerative returns to the farmers and also serve the interest of
consumers by providing quality products which are good value for money.
27

26. Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) is the largest
Organization in FMCG industry engaged in marketing of milk & milk products under the brand
names of AMUL and SAGAR with an annual turnover exceeding Rs 5000 crores.
GCMMF is a unique organization. It's a body created by Farmers, managed by
competent professionals serving a very competitive and challenging consumer market. It is a true
testimony of synergistic national development through the practice of modern management
methods.
Vision:
GCMMF will be an outstanding marketing organization, with specialization in
marketing of food and dairy products both fresh and long life with customer focus and IT
integrated. The network would consist of over 100 offices, 7500 stockiest covering at least every
Taluka. Head quarter servicing nearly 10 lakhs outlets with a turnover of Rs.10, 000 Cr and
serving several co-operatives. GCMMF shall also create markets for its products in neighboring
countries.
Mission:
We at GCMMF endeavor to satisfy the taste and nutritional requirements of the
customer of the world through excellence in the marketing by our committed team. Through co-
operative networking, we are committed to offering quality product that provides best value for
money.
28

27. Number of Producer Members 6,34,675
Number of Village Dairy Cooperative Societies 1163
Total Milk Handling Capacity 2.4 Million liters per day
Milk Collection (Daily Average 2010-11) 1.5 Million liters
Milk Drying Capacity 100 Mts per day
Whey Drying Capacity 60 Mts per day
Cattle Feed Manufacturing Capacity 1100 Mts per day
Sales Turnover
Sales Turnover Rs (Million) US $ (in million)
2000-01 5090 113
2001-02 4690 100
2002-03 4880 102
2003-04 5460 116
2004-05 6000 138
2005-06 7090 160
2006-07 8220 202
2007-08 10770 272
2008-09 13780 310
2009-10 16950 360
2010-11 21110 469
29

28. Organization Structure:
Organization Structure is divided into two parts:
External Organization Structure
Internal Organization Structure
External Organization Structure
External Organization Structure is the organization structure that affects the organization
from the outside.
The following is internal organization chart of Amul.
State Level Marketing Federation
District Milk Product Union Ltd
Village Milk Product Union Ltd
Villagers
External Organization Structure Chart
As we know, GCMMF is unit of Gujarat Milk Marketing Federation, which is a co-
operative organization. The villagers of more than 10000 villages of Gujarat are the bases of
this structure. They all make village milk producers union, district level milk producers union
and then a state level marketing federation is established. The structure is line relationship,
which provides easy way to operation. It also provides better communication between two
stages
30

29. Internal Organization Structure:
The following is internal organization chart of Amul:
Chairman
Managing Director
General Manager
Asst. General Manager
Internal Organization Structure Chart
31

30. Production Function:
Expansion of the production technology and changes in technical field is going to bring
out revolution in the industry sector which eventually gives stand to study and favors the come
backing subject i.e. production and management.
Production and operation management is planning, organizing, staffing, directing and
controlling of all the production system that portion of organization that converts inputs into
products and services. In general production system takes raw material, personnel, machines,
buildings and other resources and produce products and services.
The core of production system is its conversion subsystem where in workers; raw
materials are used to convert inputs into products and services. This production department is at
heart of the firm, as it is able to produce low cost products and superior quality in timely
manners.
Thus, there arises enormous need of giving due importance to this department as a
whole and a strong concrete base being foundation pillars of a manufacturing organization, if the
intention is to succeed domestically and globally.
Operating Analysis-
Amul‟s only source of raw material is Village Milk societies. Milk is brought from such
village milk societies every morning and evening. This milk is then sent to the dairy plant. In the
dairy plant the milk is processed i.e. it is made free from germs.
·
32

31. Milk Processing
The entire process of milk can be divided into following steps:
Milk Processing Chart
Distribution Network:
Most producers work with marketing intermediaries to bring their products to market.
The marketing intermediaries make up a marketing channel also called distribution channel.
Distribution channels are sets of interdependent organizations involved in the process of making
a product or service available for use or consumption.
The Head Office of GCMMF is located at Anand. The entire market is divided in 5
zones. The zonal offices are located at Ahmadabad, Mumbai, New Delhi, Kolkata and Chennai.
33

32. Moreover there are 49 Depots located across the country and GCMMF caters to 13 Export
markets.
A zero level of channel also called a direct marketing channel consists of a manufacturer
selling directly to the final customers. A one level channel; contains one selling intermediary
such as retailer to the final customers. A two level channel two intermediaries are typically
wholesaler and retailer. A three level channel are typically wholesaler, retailer and jobber in
between.
GCMMF has an excellent distribution. It is its distribution channel, which has made it so
popular. GCMMF‟s products like milk and milk products are perishable. It becomes that much
important for them to have a good distribution.
Distribution Chart
We can see from above figure that GCMMF distribution channel is simple and clear.
The products change hands for three times before it reaches to the final consumer. First of all the
products are stored at the Agents end who are mere facilitators in the network. Then the products
are sold to wholesale dealers who then sell to retailers and then the product finally reaches the
consumers.
Distribution Chart
34

33. Amul’s Supply Chain
Farmer
s
Village Village Local Milk Sold to
Cooperative Cooperative Restaurants/Other Village &
Societies Societies (with Milk related Local Residents
(Without Chilling Chilling Units) businesses
Units)
Network Milk Processing Chilling
Services Union & Plants
Warehouses
* Veterinary
Services
* Animal Warehouses
Husbandry
* Animal
Feed Factory
* Milk Can Wholesalers/C&S
Producers
* Agriculture
University Retailers Home Delivery
* Rural Mgmt Contractors
Institute
* Trucking
Facilities CONSUMERS CONSUMERS
35

34. Plants
First plant is at ANAND,which engaged in the manufacturing of milk, butter, ghee, milk
powder, flavored milk and buttermilk.
Second plant is at MOGAR, which engaged in manufacturing chocolate, nutrAmul,
AmulGanthia and Amul lite
36

35. Third plant is at Kanjari, which produces cattle feed.
Fourth plant is at Khatraj, which engaged in producing cheese.
Today, twelve dairies are producing different products under the brand name Amul. Today
Amul dairy is no. 1 dairy in Asia and no. 2 in the world, which is matter of proud for Gujarat
and whole India.
37

36. AMUL PRODUCTS
Product Name:Amul Gold
Packing:Poly Pack - 500ml, 1000ml, 5 Ltr
Shelf Life: 48 Hours from the date of packing
Storage condition: Under Refrigeration (Below 8°C)
Product Name:Amul Taaza
Packing:Poly Pack - 500ml, 1000ml, 200ml, 5 Ltr
Shelf Life: 48 Hours from the date of packing
Storage condition: Under Refrigeration (Below 8°C)
Product Name:Amul Butter
Packing:100g, 500g, 50g, 20g, 8.1g
Shelf Life: Best before 12 months from packaging
Storage condition: At 4°C or below
Product Name:Amul Lite
Packing:100g, 500g, 200g
Shelf Life: Best Before 6 months
Storage condition: Under Refrigeration below 10° C
38

37. Product Name:Delicious Table Margarine
Packing:100g, 500g, 200g tub & Single serve pack
Shelf Life: 9 months under refrigeration
Storage condition: Store Under Refrigeration under 10°
C
Product Name:Amul Cooking Butter
Packing:100g, 500g, 50g, 20g, 8.1g
Shelf Life: Best before 6 months from packaging
Storage condition: At 4°C or below
Product Name:Amul Processed Cheese
Packing:Cheese Block( 200g,400g, 1 kg)
Cheese Tins (400g NEOE,EOE),EOE tin has an easy open
end
Cheese Slices (200g,400g,750g), Amul A+ Cheese Slices
200g
Cheese Chiplets (200g, 500g and 1 kg)
Shelf Life: 9 Months for Cheese Tins and Cheese
Chiplets and 6 Months for Cheese Blocks and Cheese
Slices
Storage condition: Refrigerated at 4°C or below.
Product Name:Amul Emmental Cheese
Packing:Amul Emmental Cheese is available in a 400 gm
pack for the comsumer and a large wheel (5.5 Kg) for the
institutional segments.
Shelf Life: 45 days from date of packaging
Storage condition: Refrigeration temperature i.e. 4°
Centigrade to 8° Centigrade
39

38. Product Name:Amul Gouda Cheese
Packing:Amul Gouda Cheese is available in a 250 gm
pack for the comsumer and a larger wheel of 1 Kg for the
institutional segments.
Shelf Life: 6 Months from date of packaging
Storage condition: Refrigeration temperature i.e. 4°
Centigrade to 8° Centigrade
Product Name:Amul Cheese Spread
Packing:Amul Cheese Spread Tub 200g(Plain, Pepper,
Garlic,)
Shelf Life:
Storage condition:
Product Name:Amul Pizza Mozarella Cheese
Packing:1 kg Pack, 200g pack
Shelf Life: 6 Months from date of packaging
Storage condition: To be stored in the deep fridge
compartment of the refrigerator.
Product Name:Amul Gold
Packing:1000 ml
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
40

39. Product Name:Amul Taaza
Packing:1000 ml, 500 ml & 200 ml
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
Product Name:Amul Calci+ Milk
Packing:1000 ml & 200 ml
Shelf Life: 120 days when stored in cool and dry place
Storage condition: Ambient
Product Name:Amul Lite Milk
Packing:1000 ml, 200 ml
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
Product Name:Amul Kool Koko
Packing:200 ml Glass Bottle, 250 ml Can & 200 ml Tetra
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
41

40. Product Name:Amul Kool Milk Shaake
Packing:Can: 220ml and Tetra: 180ml
Shelf Life: Best before 180 days from date of packing
Storage condition: Needs no refrigeration until opened
Product Name:Nutramul Energy Drink
Packing:
Shelf Life: Best before 180 days from date of packing
Storage condition: Needs no refrigeration until opened
Product Name:Amul Masti Spiced Butter Milk
Packing:200 ml & 1 Litre in Tetrapak
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
Product Name:Amul Kool Cafe
Packing:200 ml Glass Bottle, 250 ml Can & 200 ml Tetra
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
42

41. Product Name:Amul KoolLassee
Packing:200 ml & 1 Litre in Tetrapak
Shelf Life: 120 days when stored in cool and dry place
Storage condition: Ambient
Product Name:Amul Prolife Probiotic Lassee
Packing:200 ml Glass
Shelf Life: Best Before 10 days from Packaging
Storage condition: Keep Under Refrigeration below 8° C
Product Name:Amul Prolife Buttermilk
Packing:1 Litre Plastic Bottle
Shelf Life: 7 days when stored below 8° Celsius
Storage condition: Chilled
Product Name:Amul Stamina
Packing:200 ml Tetra Pack, 250 ml Can( Orange &
Lime)
Shelf Life: Best before 120 days from packaging
Storage condition: Cool and dry place
43

42. Product Name:Amul PRO
Packing:500g Glass Cube Jar&500g Refill
Shelf Life: Best before 12 months from the date of
manufacture
Storage condition: Ambient
Product Name:Amul Ice Cream
Packing:
Cone 120 ml, 100ml, 80 ml & 50 ml
Cup 125 ml, 100 ml, 80 ml, 90 ml & 40 ml
Plastic 1 litre, 750 ml, 500 ml, 125 ml, 100 ml, 80 ml
Container & 60 ml
Stick 70 ml, 60 ml, 40 ml
Bulk / catering packs (5 litre, 4 litre), take
Take home packs (2.2 litre, 1.5 litre, 1.25 litre, 1
Home litre), combo packs (750 ml+750ml Free) and
family packs (500 ml, 250 ml)
Shelf Life: Best before 12 months from the date of
manufacture
Storage condition: -18°C or below
Product Name:Amul Flaavyo
Packing:125 ml, 500 ml cup, 5 ltr Bulk pack
Shelf Life: Best Before 6 months from Packaging
Storage condition: Keep Under -18°C
44

43. Product Name: Amul MalaiPaneer
Packing:Diced Paneer - 100 g, 200 g & 1 kg ,Block
Paneer - 200 g & 1 kg
Shelf Life: Best before 6 months
Storage condition: Stored Frozen
Product Name: Amul MastiDahi
Packing:Poly Pack - 200 gm, 400 gm, 1 kg ,PP Cup - 200
gm, 400 gm, 100 gm
Shelf Life: Best Poly Pack - 7 Days from the date of
packaging PP Cup - 15 Days
Storage condition: Under Refrigeration (Below 80C)
Product Name:Amul Probiotic Dahi
Packing:200g & 400g
Shelf Life: Best before 6 months
Storage condition: Under Refrigeration (Below 8°C)
Product Name: Amul Flaavyo Yoghurt
Packing:100 g Cup
Shelf Life: Best Before 15 days from Packaging
Storage condition: Under Refrigeration (Below 8°C)
45

44. Product Name: Amul Ghee
Packing:Pouch: 500 ml & 1 Ltr Tin: 200ml, 280ml,
500ml, 1Lrt, 2 Ltr and 5 Ltr Refill: 200ml, 500ml and 1
Ltr PET Jar: 200ml & 500 ml Bulk Pack :10 Kg Plastic
Bucket , 15 Kg Tin
Shelf Life: Pouch Packing: 9 Months Tin Packing : 12
Months Refill Packing : 9 Months Jar Packing : 6 Months
Bulk Packing : 12 Months
Storage condition: Dry and Cool place
Product Name: Sagar Ghee
Packing: Pouch: 500ml & 1 Ltr& Tin: 1 Ltr, 2Ltr & 5 Ltr
Shelf Life: Pouch Packing: 9 Months & Tin Packing: 12
Months
Storage condition: Dry and Cool place
Product Name: Amul Cow Ghee
Packing: Pouch: 500 ml &Tin: 1 Ltr
Shelf Life: Pouch Packing: 9 Months &Tin Packing: 12
Months
Storage condition: Dry and Cool place
Product Name: Amulspray
Packing:1 Kg Pouch / Tin, 500g Pouch / Tin/ Refill, 200g
Pouch / Refill, Rs 10 Pack, Rs 5 Pack
Shelf Life: 12 months
Storage condition: Ambient
46

45. Product Name: Amulya
Packing:1 Kg Pouch, 500g Pouch / Refill, 200g Pouch /
Refill, Rs 10 Pack, Rs 5 Pack
Shelf Life: 12months
Storage condition: Ambient
Product Name: Sagar Skimmed Milk Powder
Packing:500g Pouch
Shelf Life: 12 months
Storage condition: Ambient
Product Name: Sagar Tea & Coffee Whitener
Packing: 42 g Pouch pack &10 kg Jar
Shelf Life: 12 months
Storage condition: Ambient
Product Name: Amul Full Cream Milk Powder
Packing:1 Kg Pouch / Tin, 500g Pouch / Tin/ Refill, 200g
Pouch
Shelf Life: 12 months
Storage condition: Ambient
47

46. Product Name: Nutramul
Packing:500g Refill
Shelf Life: 12 months
Storage condition: Ambient
Product Name: Amul Shrikhand
Packing:100g, 200g, 500g, 1 Kg, 10 Kg, 20 Kg
Shelf Life: 6 months when stored at 0° C
Storage condition: Refrigerated
Product Name: Amul GulabJamun
Packing:1 kg (26 units of GulabJamun), 500 g (13 units
of GulabJamun)
Shelf Life: Best before 9 months from packaging
Storage condition: Cool and dry place
Product Name: Amul Basundi
Packing:500 ml Tetrapak, 1 Lit Tetrapak
Shelf Life: 180 days when stored in cool and dry place
Storage condition: Ambient
48

47. Product Name: Amul AvsarLadoo
Packing:Each box contains 15 Ladoos, Net weight 500g
Shelf Life: 45 Days
Storage condition: Store in a cool and dry place
Product Name: Amul Mithai Mate
Packing:400 g Tin: For Household Consumption. , 7.5 kg
Tin: Bakery and Institutions, 280 kg Barrel : For
Industrial Use like Biscuit and Chocolate manufacturing
etc
Shelf Life: 400 g Tin : Best before 12 months, 7.5kgTin :
Best before 6 months, 280 kg Barrel : Best before 3
months
Storage condition: cool and dry place
Product Name: Amul Rejoice Assorted Chocolate Gift
Packs
Packing:Amul Rejoice assorted chocolate 135g, 173g,
and 412g
Shelf Life: 9 months
Storage condition:15° C, dry place
Product Name: Amul Cooking Chocolate
Packing:500g, 10 kg, 20 kg
Shelf Life: 12 months
Storage condition: 15° C, dry place
49

48. Product Name: Amul Chocolate
Packing:Milk Chocolate 12g, 22g, 35g
Fundoo Milk Chocolate 12g, 30g
Dark Chocolate 35g
Fruit & Nut 40g, 2x150g
Almondbar 35g
Shelf Life: 12 months
Storage condition: 15° C, dry place
Product Name: Amul Chocozoo
Packing:ChocozooTub : 500g, Chocomini Tub : 300g,
Chocozoo Tin : 232g, Chocozoo Birthday pack : 81g,
Chocozoo Elegant Pack : 93g, Chocozoo pack of three :
27g
Shelf Life: 12 months
Storage condition: 15° C, dry place
Product Name: Utterly Delicious Chocolate Syrup
Packing:Chocolate syrup 650g plastic bottle, Chocolate
syrup 3kg plastic Jar
Shelf Life: 6 months
Storage condition: Ambient, refrigerate after opening
50

49. Product Name: Amul wafer chocolates
Packing:Amul Bindaaz wafer 15g (chocolate flavor).
Amul Bindaaz wafer 15g (strawberry flavor).
Shelf Life: 9 months
Storage condition: 15° C, dry place
Product Name: Amul Fresh Cream
Packing:200 ml : For Household Consumption
1 Ltr : For Caterers, Hotels, Restaurants and Institutions.
Shelf Life: 200ml : Best before 120 days from packaging
when stored in a cool and dry place
1 Ltr : Best before 120 days from packaging when stored
in a cool and dry place
Storage condition: Cool and dry place
Product Name: Amul Pouch Butter Milk
Packing:Poly Pack - 500ml
Shelf Life: 48 Hours from the date of packing
Storage condition: Under Refrigeration (Below 8°C)
51

50. Amul product history
Amul 1956
Milk
Ice cream Chocolates Shrikhand Fresh Milk Cheese Ghee
Power Breadspread
1996 1973 1980 1956 1962 1956
1958
Fat Free Cheese Cow
Nutrauamul Gulabjamun UHT Range Amulspray Amul Butter
Dessert Spread Ghee
1973 1997 1980/99 1968 1956
2002 1986 2002
Gulabjamun Condensed
Softy Mix Eclairs Amul WMP Paneer Amul Lite
mix Milk
2001 2001 1960 1997 1994
1999 1996
Amul Shakti Kulfi Mix Buttermilk Amulya pizza Cheese Margarine
2003 2001 1998 1987 1998 2004
Amul IMF Emmental
Chocozoo Laddoo fresh Curd
1&2 Cheese
2005 2004 1999
2001 1999
Flavoured Instant
Basundi Frozen Pizza
Milk FCMP
2005 2002
2001 2002
Khoa Fresh Cream Gouda Cheese
2006 2002 2002
Kool Cafe
2005
52

51. CHAPTER – 4
RESEARCH METHODOLOGY
53

52. Research Meaning:
A sane inventory management is of great necessity in any business organizations. The
future of business organizations depends upon how the top management defines and considers
inventory in relationship with the company‟s objectives or service levels.
Knowing factors that push to a purchasing behavior and meeting customers‟ needs remain a
crucial matter for the growth and survival in nowadays competitive market. Baki et al add that
today‟s competitive marketing environment forces producers and customers to get closer to each
other. This means organizations should give a great importance to customers‟ needs and listen to
their voices, and suppliers and customers should be closer and closer to each other in order to
produce goods or services based on the customer needs. Therefore, manufacturers and service
producers need an effective planning and control system for a powerful coordination in between
all stages of the organizations (processes, and other). The implementation and the use of an
effective planning and control system in an organization improve productivity and performance
of distribution, while decreasing waiting times. The enterprise resource planning (ERP) systems
are examples of the most strategic tools, which provide robust tools for planning, coordination
and control of the processes in all organizations.
Research Design
A research design is a plan that specifies the objectives of the study, method to be
adopted in the data collection, tools in data analysis and hypothesis to be framed.
“A research design is an arrangement of condition for collection and analysis of data in
a manner that aims to combine relevance to research purpose with economy in
procedure”.
Nature of Data
The approach of this study consists of combining research into primary and secondary
data. Secondary data, that is, the literature phase of the research has essentially been
provided in the previous chapters. The theoretical part or the literature of the study is
represented by the debate of various parameters relative to inventory management and
customer service management. This is of a vital importance in the sense that it provides
a measured explanation concerning inventory management and customer service
management in a business logistics environment where globalization, technological
innovation and changing societal expectations negatively or positively impact on the
growth and survival of business organizations on one side and manufacturing industries
logistics on the other.
Primary data has also been analyzed in the form of an empirical study. In this phase,
manufacturing industries in Gauteng Province (especially in Pretoria and Johannesburg)
were included in the study. In light of the above, it has to be indicated that the
respondents in this population (manufacturing industries in Gauteng Province) were
precisely those dealing with inventory management and customer service management.
54

53. Employees or managers of business organizations that were approached were typically
in manufacturing industries logistics according to sectors.
Research Type
Descriptive research, also known as statistical research, describes data and characteristics about
the population or phenomenon being studied. Descriptive research answers the questions who,
what, where, when, "why" and how...
Although the data description is factual, accurate and systematic, the research cannot describe
what caused a situation. Thus, Descriptive research cannot be used to create a causal
relationship, where one variable affects another. In other words, descriptive research can be
said to have a low requirement for internal validity.
The description is used for frequencies, averages and other statistical calculations. Often the
best approach, prior to writing descriptive research, is to conduct a survey investigation.
Qualitative research often has the aim of description and researchers may follow-up with
examinations of why the observations exist and what the implications of the findings are.
Sampling Sizeandtechnique
Size of the sample:
It refers to the number of items to be selected from the universe to constitute as a
sample. In these study 1 warehouse, 1 distributor & 25 retailers of Amul in Silchar has
been taken.
Sample design:
The sampling technique used in this study is simple random sampling method.
This method is also called as the method of chance selection. Each and every item of
population has equal chance to be included in the sample.
Questionnaire:
The questions are arranged logical sequence. The questionnaire consists of a
variety of questions presented to the employees for the response. Dichotomous
questions, multiple choice questions, rating scale questions were used in constructing
questionnaire.
55

54. CHAPTER – 4
DATA ANALYSIS AND INTERPRETATION
56

55. Inventory Movement Data
a) Inventory flow from distributor to retailer
Amulya 10 kg jar
15
level of inventory
Opening
Balance
10 Opening Inwards Outwards Closing
Inwards Balance Balance
5
Standard 2.345207 1.602082 1.6329931
Outwards Deviation 0
0
Mean 10.5 0 0.833333 9.6666667
1 2 3 4 5 6
Closing
days Balance
Amulya 25 Kg bag
40
level of inventory
Opening
30 Balance
Opening Inwards Outwards Closing
Balance Balance
20 Inwards
Standard 0.983192 2.345208 3.204163
10 Deviation 0
Outwards
0 Mean 35.8333 0 1.5 34.33333
1 2 3 4 5 6
Closing
days Balance
Amul A+ Cheese Slice
200 gm
150 Opening Inwards Outwards Closing
Opening
level of inventory
Balance Balance Balance
100
Inwards
Standard
Deviation 54.02838 0 8.93868 54.13470
50
Mean 64.33333 0 8.5 75.83333
Outwards
0
1 2 3 4 5 6
Closing
days Balance
57

56. Cheese Chiplet 200gm
160
140
level of inventory
120 Opening
Balance Opening Inwards Outward Closing
100
Balance s Balance
80 Inwards
60 Standard
40 Deviation 9.786044 0 4.27395 9.93478
Outwards
20 Mean 0
0 128.16666 3.66666 124.5
Closing
1 2 3 4 5 6 Balance
days
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 10.50714 0 4.89897 7.26636
Mean 61 0 4 57
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 5.16397 0 4.08248 5.47722
Mean 11.66666 0 1.66666 10
58

57. Cheese Tin 400gm
70
level of inventory
60 Opening
50 Balance Opening Inwards Outwards Closing
40 Balance Balance
Inwards
30
20 Standard
10 Outwards Deviation 16.62227 0 7.27782 14.88175
0 Mean 40.5 0 5.83333 34.66666
1 2 3 4 5 6 Closing
Balance
days
Almond bar 35gm
400
350 Opening Inwards Outwards Closing
Balance Balance
level of inventory
300 Opening
250 Balance
Standard
200 Inwards Deviation 142.4078 0 135.7743 10.32795
150 Mean 86 0 59 27
100 Outwards
50
0 Closing
1 2 3 4 5 6 Balance
days
Pizza Cheese 200 gm
50 Opening Inwards Outwards Closing
Balance Balance
level of inventory
40 Opening
Balance
30 Standard
Inwards Deviation 0 0 0 0
20
Mean 44 0 0 44
10 Outwards
0
1 2 3 4 5 6 Closing
Balance
days
59

58. Amul milk chocolate 20
gm
600
Opening
level of inventory
500 Opening Inwards Outwards Closing
Balance
400 Balance Balance
300 Inwards Standard
200
100
Deviation 108.9293 0 36.48013 97.07522
Outwards Mean
0 408 0 55 353
1 2 3 4 5 6
Closing
days Balance
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 10.32795 0 8.16496 8.164965
Mean 227 0 3 223
Bindazz Wafers 18gm
box
140
120
level of inventory
Opening
100 Balance
Opening Inwards Outwards Closing
80 Balance Balance
Inwards
60 Standard
40 Deviation 46.96239 36.7423 19.125 43.01976
20 Outwards
Mean 75 15 10 80
0
1 2 3 4 5 6 Closing
Balance
days
60

59. Bindazz Wafers 18gm jar
500
level of inventory
400 Opening Opening Inwards Outwards Closing
Balance
300 Balance Balance
Inwards
200 Standard
100
Deviation 73.48469 0 73.4846 0
Outwards Mean
0 271 0 30 241
1 2 3 4 5 6 Closing
Balance
days
Choco Zoo 12x300gm
Tub Opening Inwards Outwards Closing
120 Balance Balance
level of inventory
100 Opening
80 Balance Standard
60 Inwards Deviation 27.24273 24.4949 4.84768 26.72576
40 Mean 76 10 6 80
20 Outwards
0
1 2 3 4 5 6
Closing
days Balance
Choco Zoo 12x500gm
Tub
10
level of inventory
Opening Opening Inwards Outwards Closing
8
Balance Balance Balance
6
Inwards Standard
4
Deviation 0.516397 0 0.408248 0.408248
2
Outwards Mean
0 8 0 0 8
1 2 3 4 5 6
Closing
days Balance
61

60. Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 160.4992 0 60.22181 112.1903
Mean 1430 0 87 1343
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 70.56817 0 55.01151 19.043809
Mean 58 0 32 25
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 24.494897 0 24.4949 0
Mean 70 0 10 60
62

61. Fruit N NUT 40gm
70
level of inventory
60 Opening Opening Inwards Outwards Closing
50 Balance
40
Balance Balance
Inwards
30 Standard
20 Deviation 16.32993 0 10.32796 10.32795
10 Outwards
0
Mean 33 0 7 27
1 2 3 4 5 6 Closing
days Balance
Opening Inwards Outwards Closing
Balance Balance
Standard
Deviation 10.84435 0 9.62808 1.224744
Mean 14 0 5 10
Milk Chocolate 35 gm
600
500
Opening Inwards Outwards Closing
level of inventory
Opening
400 Balance Balance Balance
300 Inwards Standard
200
Deviation 76.9686 0 20.89657 57.94393
Outwards Mean 447 0 37 411
100
0 Closing
1 2 3 4 5 6 Balance
days
63

62. Rejoice Assorted 135
gm
6 Opening Inwards Outwards Closing
level of inventory
5 Opening
Balance Balance Balance
4
3 Inwards
Standard
2 Deviation 0 0 0 0
1
Outwards
Mean 5 0 0 5
0
1 2 3 4 5 6
Closing
days Balance
Utterly Chocolate Syrup
650 ml Opening Inwards Outwards Closing
8
Opening
Balance Balance
level of inventory
6 Balance Standard
4 Inwards Deviation 0 0 0 0
Mean 6 0 0 6
2
Outwards
0
1 2 3 4 5 6
Closing
days Balance
Amul Fresh Cream 1ltr
100
80
level of inventory
Opening
Balance Opening Inwards Outwards Closing
60 Balance Balance
Inwards
40 Standard
Deviation 0 0 0 0
20 Outwards
Mean 89 0 0 89
0 Closing
1 2 3 4 5 6 Balance
days
64

63. Amul Fresh Cream
200ml
Opening Inwards Outwards Closing
10 Balance Balance
level of inventory
8 Opening Standard
Balance
6 Deviation 0 0 0 0
Inwards Mean
4 9 0 0 9
2 Outwards
0
1 2 3 4 5 6 Closing
Balance
days
Amul Butter 100gm
10000
Opening Inwards Outwards Closing
8000
level of inventory
Opening Balance Balance
Balance
6000 Standard
Inwards
4000
Deviation 1465.734 1837.117 214.588 1516.305
Mean 7925 750 1091 7799
2000 Outwards
0
Closing
1 2 3 4 5 6 Balance
days
Amul Butter 500gm
2000
Opening Inwards Outwards Closing
level of inventory
Opening
1500
Balance Balance Balance
1000 Inwards Standard
Deviation 402.8237 0 130.259 297.1514
500
Outwards Mean 1038 0 179 859
0
1 2 3 4 5 6 Closing
Balance
days
65

64. Mithai Mate
4000
3500 Opening Inwards Outwards Closing
level of inventory
3000 Opening
Balance
Balance Balance
2500
2000 Inwards
Standard
1500 Deviation 728.9761 391.9184 456.8129 665.6646
1000 Mean 2472 160 474 2158
Outwards
500
0
Closing
1 2 3 4 5 6
Balance
days
Amulspray 1kg Pch
2500
2000 Opening Inwards Outwards Closing
level of inventory
Opening
Balance
Balance Balance
1500
Standard
Inwards
1000 Deviation 687.8120 357.189 121.639 635.32146
Mean 1505 324 188 1699
500 Outwards
0 Closing
1 2 3 4 5 6 Balance
days
Amulspray 18 gm Pch
10000
level of inventory
8000 Opening
Balance Opening Inwards Outwards Closing
6000 Balance Balance
Inwards
4000 Standard
2000 Outwards Deviation 1054.8994 0 654.343 465.7948
Mean 7556 0 458 7098
0
1 2 3 4 5 6 Closing
Balance
days
66

65. Amulspray 200 gm Pch
6000
level of inventory
5000 Opening Opening Inwards Outwards Closing
4000 Balance
Balance Balance
3000 Inwards Standard
2000 Deviation 1101.661 1995.996 297.0056 1053.245
1000 Outwards Mean 3831 1600 843 3922
0
1 2 3 4 5 6 Closing
Balance
days
Amulspray 200gm Refill
3500
3000
level of inventory
Opening Opening Inwards Outwards Closing
2500 Balance Balance Balance
2000
Inwards Standard
1500
1000 Deviation 766.5331 0 268.842 592.4689
500 Outwards Mean 2126 0 328 1798
0
1 2 3 4 5 6 Closing
Balance
days
Amulspray 20gm pch
6000
5000
level of inventory
Opening
4000 Opening Inwards Outwards Closing
Balance
Balance Balance
3000 Inwards
Standard
2000 Deviation 0 0 0 0
Outwards
1000 Mean 4950 0 0 4950
0 Closing
1 2 3 4 5 6 Balance
days
67

66. Amulspray 36gm pch
30000
25000
level of inventory
Opening
Balance
Opening Inwards Outwards Closing
20000
Balance Balance
15000 Inwards
Standard
10000
Deviation 3066.791 1290.065 1843.126 1256.769
5000 Outwards
Mean 18919 526.6667 2048 17398
0
Closing
1 2 3 4 5 6
Balance
days
Amulspray 500gm pch
2500
Opening Inwards Outwards Closing
level of inventory
2000 Opening
Balance Balance Balance
1500
Inwards Standard
1000 Deviation 263.951 318.9984 69.2023 258.7292
500 Outwards Mean 1600 200 194 1606
0
1 2 3 4 5 6 Closing
Balance
days
Amulspray 500gm Refill
1400
1200
level of inventory
1000
Opening Opening Inwards Outwards Closing
Balance Balance Balance
800
Inwards Standard
600
Deviation 143.7330 195.9592 47.07866 143.6328
400
Outwards Mean 1024 80 82 1022
200
0 Closing
1 2 3 4 5 6 Balance
days
68

67. Amulspray 500gm tin
1000
level of inventory
800 Opening
Balance Opening Inwards Outwards Closing
600
Inwards Balance Balance
400
Standard
200 Outwards Deviation 126.580 0 63.01428 145.847
0 Mean 708 0 54 654
1 2 3 4 5 6 Closing
Balance
days
Amulya 18gm Pch
7000
6000
level of inventory
Opening Opening Inwards Outwards Closing
5000 Balance
4000 Balance Balance
Inwards
3000 Standard
2000 Deviation 739.599 0 282.1829 590.748
1000 Outwards
Mean 4672 0 370 4302
0
1 2 3 4 5 6 Closing
Balance
days
Amulya 1Kg Pch
1200
1000
level of inventory
Opening Opening Inwards Outwards Closing
800 Balance Balance Balance
600 Inwards Standard
400 Deviation 208.834 122.4745 76.57785 191.709
Outwards Mean 839 50 151 738
200
0 Closing
1 2 3 4 5 6 Balance
days
69

68. Amulya 200gm Pch
1600
1400
level of inventory
Opening
1200 Opening Inwards Outwards Closing
Balance
1000 Balance Balance
800 Inwards
600 Standard
400 Deviation 224.927 0 64.7611 174.200
Outwards
200
Mean 1155 0 111 1044
0
1 2 3 4 5 6 Closing
Balance
days
Amulya 20gm Pch
2500
Opening Inwards Outwards Closing
level of inventory
2000 Opening
Balance Balance
Balance
1500 Standard
Inwards
1000 Deviation 0 0 0 0
Mean 2016 0 0 2016
500 Outwards
0
Closing
1 2 3 4 5 6
Balance
days
Amulya 25gm Pch
900
800 Opening Inwards Outwards Closing
700
level of inventory
Opening Balance Balance
600 Balance
500 Standard
Inwards
400 Deviation 0 0 0 0
300 Mean
Outwards 856 0 0 856
200
100
0 Closing
1 2 3 4 5 6 Balance
days
70

69. Amulya 36gm Pch
50000
level of inventory
40000 Opening
Opening Inwards Outwards Closing
Balance
30000 Balance Balance
Inwards
20000 Standard
Deviation 16319.245 11757.55 3078.02 15117.81
10000 Outwards
Mean 19682 9600 6318 22964
0
1 2 3 4 5 6 Closing
Balance
days
Amulya 475gm Pch
300
level of inventory
250 Opening
200 Balance Opening Inwards Outwards Closing
150 Inwards Balance Balance
100 Standard
50 Outwards Deviation 0 0 0 0
0
Mean 281 0 0 281
1 2 3 4 5 6 Closing
days Balance
Amulya 500gm Pch
3000
Opening Inwards Outwards Closing
2500
Balance Balance
level of inventory
Opening
2000 Balance Standard
1500 Inwards Deviation 893.354 534.864 236.2147 888.296
1000 Mean 1512 472 202 1781
Outwards
500
0 Closing
1 2 3 4 5 6 Balance
days
71

70. Amulya 50gm Pch
300
Opening Inwards Outwards Closing
level of inventory
250 Opening
200 Balance Balance Balance
150 Inwards Standard
100 Deviation 0 0 0 0
50 Outwards Mean 256 0 0 256
0
1 2 3 4 5 6 Closing
Balance
days
Amulya 900gm Pch
1600
1400 Opening Inwards Outwards Closing
level of inventory
1200 Opening
Balance Balance
1000 Balance
Standard
800 Inwards
Deviation 353.395 296.226 160.7699 325.6878
600
400
Mean 954 225 169 1010
Outwards
200
0 Closing
1 2 3 4 5 6 Balance
days
Amul Lite 200gm
70
Opening Inwards Outwards Closing
60
level of inventory
Opening Balance Balance
50 Balance
40 Standard
Inwards Deviation 23.001 26.12789 16.32993 22.294
30
20 Mean 29 10.66667 17 23
Outwards
10
0
Closing
1 2 3 4 5 6
Balance
days
72

71. Nutramul 500gm Refil
14
12
level of inventory
Opening Opening Inwards Outwards Closing
10 Balance Balance Balance
8
6
Inwards Standard
4 Deviation 0 0 0 0
2 Outwards Mean 13 0 0 13
0
1 2 3 4 5 6 Closing
Balance
days
Amul Ghee 1Ltr Refill
250
Opening Inwards Outwards Closing
200 Balance Balance
level of inventory
Opening
150
Balance Standard
Inwards Deviation 58.718 0 28.556 56.705
100 Mean 149 0 28 122
50 Outwards
0 Closing
1 2 3 4 5 6 Balance
days
Amul Ghee 1Ltr Tin
140
120
Opening Inwards Outwards Closing
level of inventory
Opening
100
Balance Balance Balance
80
Inwards Standard
60
Deviation 26.044 24.4949 4.806246 22.662
40
Outwards Mean 104 10 6 108
20
0 Closing
1 2 3 4 5 6 Balance
days
73

72. Amul Ghee 5Ltr Tin
50
level of inventory
40 Opening
Opening Inwards Outwards Closing
Balance
30 Balance Balance
Inwards
20 Standard
Deviation 3.829 4.898979 1.974842 3.311
10 Outwards
Mean 40 2 2 41
0
1 2 3 4 5 6 Closing
Balance
days
Basundi
25
20
level of inventory
Opening Opening Inwards Outwards Closing
Balance Balance Balance
15
Inwards Standard
10 Deviation 0 0 0 0
5 Outwards Mean 22 0 0 22
0 Closing
1 2 3 4 5 6 Balance
days
Kool Bottle 200ml
12000
Opening Inwards Outwards Closing
level of inventory
10000 Opening
Balance Balance
8000 Balance
Standard
6000 Inwards
Deviation 433.439 391.9184 80.95431 434.854
4000
Mean 9921 160 64 10017
2000 Outwards
0
1 2 3 4 5 6 Closing
Balance
days
74

73. Kool Café Can 250ml
700
level of inventory
600 Opening
500 Balance Opening Inwards Outwards Closing
400 Balance Balance
Inwards
300 Standard
200
100 Outwards
Deviation 0 0 0 0
0 Mean 576 0 0 576
1 2 3 4 5 6 Closing
days Balance
Kool Koko 250ml
700
600 Opening Inwards Outwards Closing
level of inventory
Opening
500 Balance Balance Balance
400 Standard
Inwards
300 Deviation 0 0 0 0
200 Mean
Outwards 597 0 0 597
100
0
Closing
1 2 3 4 5 6 Balance
days
Kool Milk Shaake Can
220ml
1000
Opening Inwards Outwards Closing
level of inventory
800 Opening
Balance Balance
Balance
600 Standard
Inwards
400 Deviation 0 0 0 0
200
Mean 842 0 0 842
Outwards
0
1 2 3 4 5 6 Closing
Balance
days
75

74. Amul Calci 1Ltr
60 Opening Inwards Outwards Closing
level of inventory
50 Opening Balance Balance
40 Balance
Standard
30 Inwards Deviation 0 0 14.69694 14.696
20 Mean 48 0 6 42
10 Outwards
0
1 2 3 4 5 6 Closing
Balance
days
Amul Gold 1Ltr
300
250 Opening Inwards Outwards Closing
level of inventory
Opening
Balance
Balance Balance
200
150 Inwards
Standard
Deviation 75.227 0 50.30474 58.511
100
Outwards
Mean 164 0 25 137
50
0
Closing
1 2 3 4 5 6
Balance
days
Amul Shakti 1ltr
90
80
70 Opening Inwards Outwards Closing
level of inventory
Opening
60 Balance Balance Balance
50 Standard
Inwards
40 Deviation 0 0 0 0
30
20 Outwards Mean 80 0 0 80
10
0 Closing
1 2 3 4 5 6 Balance
days
76

75. Amul Taaza 1Ltr
10000
level of inventory
8000 Opening
Balance Opening Inwards Outwards Closing
6000 Balance Balance
Inwards
4000 Standard
2000 Outwards
Deviation 1952.172 2201.817 342.070 1745.202
Mean 6011 1400 990 6422
0
1 2 3 4 5 6 Closing
Balance
days
Amul Taaza 200ml
2000
Opening Inwards Outwards Closing
level of inventory
Opening Balance Balance
1500
Balance
Standard
1000 Inwards Deviation 0 0 0 0
500 Mean 1525 0 0 1525
Outwards
0
1 2 3 4 5 6 Closing
Balance
days
Amul Taaza 500ml
3500
3000 Opening Inwards Outwards Closing
level of inventory
Opening
2500 Balance Balance
Balance
2000 Standard
Inwards
1500 Deviation 499.215 293.938 199.0698 591.134
1000 Mean 2144 120 480 1784
Outwards
500
0
Closing
1 2 3 4 5 6 Balance
days
77

76. Amul Kool Lassee
Opening Inwards Outwards Closing
200ml Balance Balance
200 Standard
Opening
level of inventory
150 Balance Deviation 0 0 0 0
100 Inwards Mean 144 0 0 144
50
Outwards
0
1 2 3 4 5 6
Closing
days Balance
Gulab Jamun 1kg tin
45
40 Opening Inwards Outwards Closing
35
level of inventory
Opening Balance Balance
30 Balance
25 Standard
Inwards Deviation 5.465 9.797959 5.205766 4.996
20
15 Mean 35 4 4 36
10 Outwards
5
0 Closing
1 2 3 4 5 6 Balance
days
Gulab Jamun 500gm
tin
150 Opening Inwards Outwards Closing
level of inventory
Balance Balance
100 Opening
Balance Standard
50 Inwards Deviation 21.522 29.39388 11.183 17.996
Mean 111 12 8 115
0
1 2 3 4 5 6 Outwards
days
78

77. Total flow of different inventories
50000
Amulya 10 kg jar
45000 Amulya 25 Kg bag
Amul A+ Cheese Slice 200 gm
Cheese Chiplet 200gm
40000 Cheese Slice 200gm
Cheese Spread 200gm
Cheese Tin 400gm
35000 Pizza Cheese 200 gm
Almond bar 35gm
Amul milk chocolate 20 gm
30000
Amul milk chocolate 22 gm
Bindazz Wafers 18gm box
Bindazz Wafers 18gm jar
25000
Choco Zoo 12x300gm Tub
Choco Zoo 12x500gm Tub
20000 Choco Zoo 3-pack 27gm
Choco Zoo 60x81gm Birthday
Dark Chocolate 35gm
15000 Fruit N NUT 40gm
Fruit N NUT 150gm
Milk Chocolate 35 gm
10000 Rejoice Assorted 135 gm
Utterly Chocolate Syrup 650 ml
Amul Fresh Cream 1ltr
5000
Amul Fresh Cream 200ml
Amul Butter 100gm
Amul Butter 500gm
0
DAY 1 DAY 2 DAY 3 DAY 4 DAY 5 DAY 6 DAY 7
79

78. b) Inventory flow from retailer to customers
Amul has divided Silchar town into 6 bits these are College road, Sonai road, Hailakandi
road, Central road, Tarapur&Malugram. Each bit has pre-determined day of delivery.
DAY BIT
MONDAY College road
TUESDAY Sonai road
WEDNESDAY Hailakandi road
THURSDAY Central road
FRIDAY Tarapur
SATURDAY Malugram
I. College Road
Information regarding the flow of inventories of retailers of College Road are given
below
1st Retailer
100
90 Almond bar 35gm
80
70 Bindazz Wafers
60 18gm jar
Choco Zoo
50
60x81gm Birthday
40 Amul Butter 100gm
30
20 Amul Butter 500gm
10
0
1 2 3 4 5 6
80

79. 2nd Retailer
120
Amul Butter
100 100gm
Amul Butter
80
500gm
60 Amulspray 18
gm Pch
40 Amulspray 1kg
Pch
20 Amulspray 200
gm Pch
0
1 2 3 4 5 6
Almond bar 35gm
70
3rd Retailer
Choco Zoo 3-pack
27gm
60 Choco Zoo
60x81gm Birthday
50 Dark Chocolate
35gm
40 Amul Butter 100gm
30 Amul Butter 500gm
20 Mithai Mate
10 Amulspray 18 gm
Pch
0 Amul Taaza 1Ltr
1 2 3 4 5 6
4th Retailer Amul Butter
140 100gm
Mithai Mate
120
Amulspray 18 gm
100 Pch
Amulspray 200
80 gm Pch
Amulspray
60
500gm pch
40 Amulya 36gm
Pch
20 Amul Taaza 1Ltr
0 Amul Taaza
1 2 3 4 5 6 500ml
81

80. 5th Retailer Almond bar 35gm
120
Choco Zoo 3-pack
100 27gm
Dark Chocolate
35gm
80
Mithai Mate
60 Amulspray 18 gm
Pch
40 Amulspray 200 gm
Pch
20 Amulya 36gm Pch
0 Amulya 500gm
Pch
1 2 3 4 5 6
II. Sonai road
Information regarding the flow of inventories of retailers of Sonai Road are given
below
1st Retailer Amul Butter
60
100gm
Amul Butter
50 500gm
Mithai Mate
40
Amulspray 1kg
Pch
30 Amulspray 200
gm Pch
20 Amulspray
36gm pch
Amulya 36gm
10 Pch
Amul Taaza
0 1Ltr
1 2 3 4 5 6
82

81. Cheese Slice 200gm
2nd Retailer
70 Amul milk chocolate
20 gm
60
Choco Zoo 3-pack
50 27gm
Amul Butter 100gm
40
Mithai Mate
30
Amulspray 36gm
20
pch
10 Amulya 18gm Pch
0 Amulya 36gm Pch
1 2 3 4 5 6
3rd Retailer Amulspray 18
35
gm Pch
30 Amulspray 1kg
Pch
25
Amulspray 200
20 gm Pch
Amulspray 36gm
15 pch
10 Amulya 36gm
Pch
5 Amul Taaza 1Ltr
0
1 2 3 4 5 6
40
4th Retailer Cheese Tin 400gm
35 Amul milk
30 chocolate 20 gm
25 Choco Zoo 3-pack
27gm
20
Amul Butter
15 100gm
10 Amul Taaza 1Ltr
5
Amul Taaza 500ml
0
1 2 3 4 5 6
83

82. 5th Retailer Amul milk chocolate
40 20 gm
Choco Zoo 60x81gm
35
Birthday
30 Milk Chocolate 35
gm
25 Amul Butter 100gm
20 Kool Bottle 200ml
15
Amul Gold 1Ltr
10
Amul Taaza 1Ltr
5
0 Gulab Jamun 1kg tin
1 2 3 4 5 6
III. Hailakandi road
Information regarding the flow of inventories of retailers of HailakandiRoad are given
below
1st Retailer
140
Amul Butter
120 100gm
Mithai Mate
100
80 Amulspray 200gm
Refill
60 Amulya 18gm Pch
40
Amulya 36gm Pch
20
Amul Taaza 500ml
0
1 2 3 4 5 6
84

83. 2nd Retailer Cheese Tin
120
400gm
100 Amulspray
200gm Refill
80
Amulya 36gm
60 Pch
Amul Ghee 1Ltr
40 Refill
Amul Taaza 1Ltr
20
Amul Taaza
0
500ml
1 2 3 4 5 6
40
3rd Retailer
35 Amulspray 500gm
pch
30
Amulya 1Kg Pch
25
20 Amulya 500gm
Pch
15 Amulya 900gm
10 Pch
5 Amul Ghee 1Ltr
Refill
0
1 2 3 4 5 6
4th Retailer Cheese Tin
40 400gm
Almond bar 35gm
35
30 Choco Zoo 3-pack
27gm
25 Milk Chocolate
20 35 gm
Amul Butter
15 100gm
Amul Butter
10 500gm
Mithai Mate
5
0 Amulspray 36gm
1 2 3 4 5 6 pch
85

84. 5th Retailer Cheese Chiplet
40
200gm
35
Amul Butter
30 100gm
25 Amul Butter
500gm
20
Amulspray
15 36gm pch
10 Amulya 36gm
Pch
5
Amul Taaza
0 1Ltr
1 2 3 4 5 6
IV. Central road
Information regarding the flow of inventories of retailers of HailakandiRoad are given
below
1st Retailer
Cheese Spread
140 200gm
Amul milk
120
chocolate 20 gm
Amul Butter
100
100gm
Amulspray 36gm
80
pch
Amulspray
60
500gm pch
Amulspray
40
500gm tin
Amulya 36gm
20
Pch
Amul Taaza 1Ltr
0
1 2 3 4 5 6
86

85. 2nd Retailer Amul A+ Cheese Slice 200
gm
140 Cheese Tin 400gm
120 Amul milk chocolate 20 gm
100 Choco Zoo 3-pack 27gm
80 Amul Butter 100gm
60 Amul Butter 500gm
Mithai Mate
40
Amulspray 36gm pch
20
Amulya 1Kg Pch
0
1 2 3 4 5 6 Amulya 36gm Pch
70
3rd Retailer Amulspray 200 gm Pch
Amulspray 36gm pch
60
Amulspray 500gm pch
50
Amulspray 500gm tin
40
Amulya 1Kg Pch
30 Amulya 36gm Pch
20 Amulya 500gm Pch
10 Amul Taaza 1Ltr
0 Amul Taaza 500ml
1 2 3 4 5 6 Gulab Jamun 500gm tin
80
4th Retailer
Amul Butter
70
100gm
60 Amulspray 1kg
50 Pch
Amulspray 200
40
gm Pch
30 Amulspray 36gm
20 pch
Amulya 1Kg Pch
10
0
1 2 3 4 5 6
87

86. Cheese Chiplet 200gm
5th Retailer
30 Cheese Tin 400gm
Choco Zoo 3-pack 27gm
25
Amul Butter 100gm
20 Amulspray 1kg Pch
15 Amulspray 200 gm Pch
Amulspray 200gm Refill
10
Amulya 1Kg Pch
5 Amulya 500gm Pch
Amul Taaza 1Ltr
0
Amul Taaza 500ml
1 2 3 4 5 6
V. Tarapur
Information regarding the flow of inventories of retailers of HailakandiRoad are given
below
160
1st Retailer
140
120
100
80 Amul Butter 100gm
Mithai Mate
60
Amulya 36gm Pch
40
20
0
1 2 3 4 5 6
88

87. 60
2nd Retailer
50
40 Amulspray 1kg Pch
30 Amulspray 200 gm Pch
Amulspray 36gm pch
20
Amulya 36gm Pch
10 Amul Taaza 1Ltr
0
1 2 3 4 5 6
60
3rd Retailer
50
Amul Butter 100gm
40
Amul Butter 500gm
30 Mithai Mate
20 Amulspray 1kg Pch
Amulya 1Kg Pch
10
Amul Taaza 1Ltr
0
1 2 3 4 5 6
45
4th Retailer
40
35
30
25 Mithai Mate
20 Amulspray 36gm pch
15 Amul Taaza 1Ltr
10 Amul Taaza 500ml
5
0
1 2 3 4 5 6
89

88. 30
5th Retailer
25 Amul A+ Cheese Slice
200 gm
20 Amul milk chocolate
20 gm
15
Amul Butter 100gm
10
Amul Butter 500gm
5
Mithai Mate
0
1 2 3 4 5 6
VI. Malugram
Information regarding the flow of inventories of retailers of MalugramRoad are given
below
80
1th Retailer
70 Amul Butter
100gm
60
Amulspray 1kg
50
Pch
40
Amulspray 36gm
30 pch
20
Amulya 1Kg Pch
10
0
1 2 3 4 5 6
90

89. 2nd Retailer
30
Cheese Tin
400gm
25
20 Amul Ghee 1Ltr
Refill
15
Amul Taaza 1Ltr
10
5
Amul Taaza
0 500ml
1 2 3 4 5 6
3th Retailer Almond bar 35gm
35
Choco Zoo 3-pack
30
27gm
25 Dark Chocolate
35gm
20 Mithai Mate
15
Amulspray 18 gm
10 Pch
Amulspray 200 gm
5 Pch
0 Amul Taaza 1Ltr
1 2 3 4 5 6
60
4nd Retailer
50
40
Amulspray 200 gm Pch
30 Amulspray 36gm pch
20 Amulya 36gm Pch
Amul Taaza 1Ltr
10
0
1 2 3 4 5 6
91

90. 5nd Retailer
140
120
100
80
Cheese Tin 400gm
60
40 Amul Butter 100gm
20
Amulspray 36gm pch
0
1 2 3 4 5 6 Amulya 36gm Pch
Satisfaction level of retailers regarding the distribution of Amul products
Are you satisfied with the distribution of amul products?
14
12
10
8
6
4
2
0
Strongly agree Agree Neither agree nor disagree Disagree Strongly Disagree
92

91. Findings
1. Warehouse
a) They use Pull System of replenishment process.
b) Generally they place order weekly but in case of shortage they place order on due
date.
c) They use optional replenishment system technique for inventory control.
d) The lead time is three days.
e) The orders grouped for dispatch is on the basis of location of distributors.
f) They measure your warehouse performance on the basis of On-time Dispatch,
On-time delivery, Inventory acuracy &Unit handled.
g) The rate of obsolesce is less than 10%.
2. Distributor
a) They use Pull System of replenishment process.
b) They place order three times in a week.
c) They use periodic review system technique for inventory control.
d) The lead time is 24 hrs.
e) The orders grouped for dispatch is on the basis of location of retailers.
f) The rate of obsolesce is more than 10%.
3. Retailers
a) They use Pull System of replenishment process.
b) They place order one time in a week.
c) They use periodic review system technique for inventory control.
d) The lead time is one week.
e) The rate of obsolesce is more than 10%.
The Overall findings are as follows:-
1. The retailers are not satisfied with the distribution of Amul products.
2. There is monopoly in the market due to the presence of only one distributor in the
Silchar market.
3. Amul warehouse is not providing all the SKU‟s regularly.
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92. 4. When there is excess of inventory, they use to dump their products in the lower leg
(specially Amul Taza).
5. As per Amul officials the obsolesce rate is less than 10%. But as per the distributor
& retailers it is more than 10%.
Suggestions
1. As the retailers are not satisfied with the distribution of Amul products, the
efficiency level of distribution should be increased. And the distribution should be
done more than once in a week.
2. Proper forecasting should be done by Amul officials to overcome overstocking &
stock out problem.
3. They should provide regularly all those SKU‟s which they have already provided
to the consumers.
4. The Amul officials should take feedback from the retailers & consumers to
understand their needs & wants.
5. Amul officials should take strict steps to stop this monopoly.
Conclusion
Inventory is a quantity or store of goods that is held for some purpose or use (the term
may also be used as a verb, meaning to take inventory or to count all goods held in
inventory). Inaccurate inventory counts can cost you sales and delay shipments past the
promise date. Out-of stock items as well as overstocked items in inventory can be
devastating to your business. Additionally, an overstated or understated inventory
valuation can result in incorrectly reported assets within your financial statements.
Inventory Management offers comprehensive reporting capabilities to keep you on top of
inventory status. Centralized inventory management consolidates inventory information
by tracking lot numbers, on-hand levels and expiration dates, making the re-ordering
process more efficient. It also enables simultaneous tracking and documenting supplies
during studies to reduce redundant data entry and increase workflow efficiency.Sothe
biggest challenge Amul has to deal with was managing the continuous flow of all SKU‟s
in the Silchar market to have competitive edge over the competitors.
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93. APPENDIX
95

94. (QUESTIONARE)
(Warehouse)
Dear Sir/Madam
I am a student of Dept. of Business Administration of Assam University, Silchar. I am doing my
project in operations management on the topic INVENTORY STRATEGY FOR PROCESSING
INDEPENDENT DEMAND. For the completion of the project I kindly request your valuable opinion&
suggestion & I expect your co-operation also to fill the questionnaire given below. I assure you that the
information furnished will be strictly confidential & used for academic purpose only.
(Sagardwip Dey)
1. What is the replenishment process?
Pull System Push system
2. How frequently you place order in C&F/Plant?
Weekly Fortnight Any other ___________________________
3. What inventory control system you are using?
Continuous review system Periodic review system Optional
replenishment system Base stock system Any other _______________
4. What is the lead time?
24hrs 48hrs 1 week 15 days Any other ______________
5. Different stock keeping units do you currently having in your following products?
I. Amul Butter 20g ______ 50g _______ 100g______ 500g____
II. Amul Cheese 400g ______
III. Amul Gold 1L ______
IV. Amul Taza1L _______ 200ml ______ 500ml ______
V. Amul Kool Cafe 200ml glass bottle _______ 250mlcan________
VI. Amul KoolLassee200ml _____
VII. Amul Spray 1kg _____ 200gm_____ 500gm _____
VIII. Amullya1kg _____ 200gm_____ 500gm _____
IX. Amul Mithai Mate 400gTin ____
X. Amul Chocolate
a) Milk chocolate 12g _____
b) Fundoo milk chocolate 12g _____
c) Dark chocolate 35g _____
d) Fruit & Nut 40g _____
e) Almond Bar 35g _____
XI. Amul chocolate Syrup 650g plastic bottle ______
XII. Amul Bindaaz wafer 15g _____
XIII. Amul Fresh cream 200 ml ______ 1L _____
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95. XIV. Amul Rejoice Associated chocolate
135g _____ 173g _____ 412g _____
6. How are orders grouped for dispatch?
By location of distributors / stock list / customer
On first booked first dispatch basis irrespective of location & item
By similar items
By route
Any other ____________________
7. How you measure your warehouse performance
On-time Dispatch On-time delivery
Inventory acuracy Accuracy of invoice
Stock outs Mismatch / error in dispatch
Warehouse cycle time Customer complains
Unit handled Value handled
Do not measure Any other _________
8. What is the average replenishment time for the dealers/distributors?
24hrs 48hrs 1 week 15 days Any other ______________
9. What is the rate of obsolete inventory?
<10% 10-25% 25-50% >50%
97

96. (QUESTIONARE)
(Distributor)
Dear Sir/Madam
I am a student of Dept. of Business Administration of Assam University, Silchar. I am doing my
project in operations management on the topic INVENTORY STRATEGY FOR PROCESSING
INDEPENDENT DEMAND. For the completion of the project I kindly request your valuable opinion&
suggestion & I expect your co-operation also to fill the questionnaire given below. I assure you that the
information furnished will be strictly confidential & used for academic purpose only.
(Sagardwip Dey)
1. What is the replenishment process?
Pull System Push system
2. How frequently you place order ?
Weekly Fortnight Any other ___________________________
3. What inventory control system you are using?
Continuous review system Periodic review system Optional
replenishment system Base stock system Any other _______________
4. What is the lead time?
24hrs 48hrs 1 week 15 days Any other ______________
5. Different stock keeping units do you currently having in your following products?
XI. Amul Butter 20g ______ 50g _______ 100g______ 500g____
XII. Amul Cheese 400g ______
XIII. Amul Gold 1L ______
XIV. Amul Taza1L _______ 200ml ______ 500ml ______
XV. Amul Kool Cafe 200ml glass bottle _______ 250mlcan________
XVI. Amul KoolLassee200ml _____
XVII. Amul Spray 1kg _____ 200gm_____ 500gm _____
XVIII. Amullya1kg _____ 200gm_____ 500gm _____
XIX. Amul Mithai Mate 400gTin ____
XX. Amul Chocolate
f) Milk chocolate 12g _____
g) Fundoo milk chocolate 12g _____
h) Dark chocolate 35g _____
i) Fruit & Nut 40g _____
j) Almond Bar 35g _____
XV. Amul chocolate Syrup 650g plastic bottle ______
XVI. Amul Bindaaz wafer 15g _____
XVII. Amul Fresh cream 200 ml ______ 1L _____
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97. XVIII. Amul Rejoice Associated chocolate
135g _____ 173g _____ 412g _____
6. How are orders grouped for dispatch?
By location of distributors / stock list / customer
On first booked first dispatch basis irrespective of location & item
By similar items
By route
Any other ____________________
7. What is the average replenishment time for the retailers?
24hrs 48hrs 1 week 15 days Any other ______________
8. What is the rate of obsolete inventory?
<10% 10-25% 25-50% >50%
99

98. (QUESTIONARE)
(Retailers)
Dear Sir/Madam
I am a student of Dept. of Business Administration of Assam University, Silchar. I am doing my
project in operations management on the topic INVENTORY STRATEGY FOR PROCESSING
INDEPENDENT DEMAND. For the completion of the project I kindly request your valuable opinion&
suggestion & I expect your co-operation also to fill the questionnaire given below. I assure you that the
information furnished will be strictly confidential & used for academic purpose only.
(Sagardwip Dey)
1. What is the replenishment process?
Pull System Push system
2. How frequently you place order?
Weekly Fortnight Any other ___________________________
3. What inventory control system you are using?
Continuous review system Periodic review system Optional
replenishment system Base stock system Any other _______________
4. What is the lead time?
24hrs 48hrs 1 week 15 days Any other ______________
5. What is the rate of obsolete inventory?
<10% 10-25% 25-50% >50%
6. Product movement
Products Day1 Day2 Day3 Day4 Day5 Day6
100

99. 7. Are you satisfied with the distribution of amul products?
Strongly agree AgreeNeither agree nor disagree Disagree
Strongly Disagree
101

100. BIBILOGRAPHY
102

101. BOOKS
Chopra, Sunil and Peter Meindl, 2007,Supply Chain Management – Strategy, Planning
and Operation, 3rd Edition , Pearson Education.
KRAJEWSKI L J & RITZMAN L P, 2007,Operations management. Strategy and
Analysis, 8th edition, ADDISON-WESLEY.
Stevenson, William J, 2005, Production Operations Management. Boston, MA:
Irwin/McGraw Hill.
Bose D, 2006, Inventory Management, 4th Edition, PHI Private Limited.
Muller (2003), Essentials of inventory management, [online] Available:
http://www.books.co
Kothari C.R., 2004, Marketing Research, 2nd Edition, New Age international Publisher
WEBSITES
http://www.amul.com
http://www.scribd.com
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