new project ok

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ACKNOWLEDGEMENT

With a since of soul gratitude, I have submitted this project report to university of

Pune. Im thankful to the Director Prof. Dr. L. K. Tripathy and the faculty member.

For extending helping hand during the course of the project. I would also thank the

ownerMr. Pratik Patil ofSahyadri Motors Pvt.Ltd for providing an opportunity to

conduct the project in their organization. Also the staff of the organization for being co-

operative and patient in spite of their busy schedules.

I m grateful to my project guide Prof. G.S.Lokhande for providing guidance.

Im thank the librarian and the administration. During the project work I learn that,I rarely learn from my success but I learn more from my mistakes.

Rohit S. Shinde

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DECLARATION

I hereby declare that the project report entitled STUDY OF LOGISTICS

MANAGEMENT is an independent analysis work carried out by me as a part of MBA

curriculum, university of Pune under the guidance of Prof. G.S. Lokhande.

This project was undertaken as a part of academic curriculum according to the

university rules and norms and had no commercial interest and motive. It is my original

work. It is not submitted to any other organization for any other purpose.

Place: Signature

Date: (ROHIT SHINDE.)

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INDEX

Sr. No. Chapter Name Page no.

I Introduction To Study 7

II Company Profile 11

III Theoretical Background 18

IV Research Methodology of Study 30

V Project Analysis 32

VII Observations and Suggestions 58

VIII Conclusion 62

IX Annexure 64

X Bibliography 66

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EXECUTIVE SUMMARY

EXECUTIVE SUMMARY

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Project Title: Logistics Management

Company Name: Mahindra Logistics Pvt. Ltd

Introduction:

In December 2000, the Mahindra Group set up Mahindra Logistics (erstwhile

Transport Solutions Group) to take care of its complex transportation needs. These

included inbound and outbound logistics and inter-plant movement, among other

services. While it initially focused on logistics opportunities within M&M business, it

extended services to external clients across the world. Mahindra Logistics has now

grown into a complete logistics service provider offering end-to- end supply chain

solutions. Mahindra Logistics was spun off as a 100% subsidiary of M&M Ltd. From 1stOct 2008, and was rechristened as Mahindra Logistics Limited (MLL).

Logistics Management is an important tool in the hands of management for

analyzing the performance of company. This involves the study of,

Material handling

Order processing

Inventory Control(ABC Analysis)

Warehouse & Stores management

Packing Department

Transportation management

For this study last year company information related to all departmental activities

are taken into consideration. The main objective in undertaking this project is to

supplement academic knowledge with absolute practical exposure to day to day

functions of the organization.

The training at Mahindra Logistics involved day to day working at logistics

departments with the senior managers in the company. This project helped us to get

the deeper understanding of the process or operations in logistics department of

Mahindra Logistics Ltd & how decisions are taken.

Companys concept of analysis:

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Illustrating each head in detail with aspects like understanding concepts,

procedures, etc.

Follow up of action & control measures taken by the company to increase the

profitability & performance of the company.

Study performance of Logistics Department every year.

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CHAPTER NO. 1

INTRODUCTION

TO

STUDY

INTRODUCTION OF THE STUDY

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As we know logistic management plays very vital role in any automobile or

industrial organization. Without logistics any industry cant survive and also without

proper utilization of money, manpower, the organization cant stand for a longer span.

Logistics is defined as a business planning framework for the management of material,

service, information and capital flows. It includes the increasingly complex information,

communication and control systems required in today's business environment. The major

areas of logistics are international logistics, warehousing, transportation, etc. There are so

many tools and techniques to judge the operational conditions of the organization. One of

them is logistics management which helps in taking operational decision. Here project

trainee has done the project on logistics management of Mahindra Logistics, satara;

trainee analyze the operational conditions by analyzing conditions of logistic departmentand service department of the organization.

We can say that Logistics management is a part of operations management. It is

related with the operational, transformational & warehousing of the organization. It is an

important and integral part of operations management and short term survival is a

perquisite for long term success.

NEED OF PROJECT WORK:

The main purpose of carrying out this project is to know and gain practical

knowledge and to know the organization working nature. The purpose of the project is

to know the operation of organization so as to do through study. The project study also

provides an opportunity to develop communication skill, analytical skill and also expose

to the organization culture and the actual working of the organization.

In todays cutthroat competition world management has to perform variety of

functions and responsibilities. Theoretical knowledge of such function and

responsibilities can be obtained in the institute. But practically, when this knowledge is

applied in the corporate world, the managers face many difficulties.

1.2)UTILITY OF STUDY:

Education is only a means to an end and not an end in itself. The ultimate

objective of making this project is to develop self reliance, learning habit, creating

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awareness of the special and culture environment. Developing appropriate

communication skill, application of knowledge of project and survey of their programs.

The project also held to build the skill. Analyze the contribution of the project acceptance

as a great opportunity as one can apply the knowledge through project survey etc and to

study the problem face by the industry.

1.3) SCOPE OF THE STUDY:

In the project I tried to analyze logistical, transportation, etc. conditions years

2009 to 2010. Logistics management is the base for any production & sales unit so; it is

related to overall objective of the firm. This study is basically concerned with logistics

Management techniques. This aspect covered the determination of the type of Controlrequired & ABC analysis which help the inventory control & to judge the right

demanded material or say spare parts. This study helps to minimize cost of holding the

inventory. The maintenance of inventory also helps an organization to enhance its sales

efforts. It serves to bridge the gap between current production & actual sales. This study

also helps to minimize the setup time & all types of operational times for each unit.

1.4) OBJECTIVES OF THE STUDY:

The main objective of carrying out this project is to know and gain practical

knowledge and to know the operational nature of organization.

To study the various problems in logistic management.

To understand the role of logistic management in india.

To apply various tools of logistics management in organization.

To apply ABC analysis & to study Spare parts management.

To apply concepts of Material handling practically. To know about the clearing process that included in the logistic.

To suggest the appropriate framework of thinking for all logistics practices; that

is, general theory of logistics.

1.5) LIMITATIONS OF STUDY

1. All the programs are going under AGN software so there are the limitations regarding

the analysis of the data without user of that company only.

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2. As logistics management is the vast topic it required lot of time to understand the

process in the company at each department.

3. Some time respondent was busy because of that information regarding project work

will not available as soon as possible.

4. Non availability of data and transit or lead time is not fixed.

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CHAPTER NO. 2

COMPANY

PROFILE

MAHINDRA LOGISTICS PVT. LTD.

Value driven logistics solutions for your dynamic needs

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"We deliver value by offering customized integrated logistics solutions with

comprehensive & timely service support, allowing our customers to focus on their core

business areas"

"Our proven expertise and the credibility of the Mahindra group, is an assurance

for being the right business partner in a dynamic environment".

VISION

To be the leading edge logistics partner ensuring highest customer satisfaction in

our select industry segments.

PRINCIPALS

We shall ingeniously surpass our customers latent desire by unleashing the

passion of our people.

We may comprise on price but never on quality of service.

ABOUT US

Mahindra Logistics a Mahindra group company is focused on offering end-to-

end Supply Chain Solutions and People Logistics Solutions. Mahindra Logistics supply

chain solutions focus on key industry verticals of Automotive, Retail, Telecom,

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Pharmacy and Express logistics. Mahindra Logistics is a market leader in People

Logistics segment with dominance in the ITes and BPO industry.

Mahindra Logistics is a leading established player in the Indian logistics industry

with over 200 major corporate clients. We hold a strong presence in the automotive

sector and are currently managing more than 35 automotive plants. Having a

warehousing capacity of more than 3 million sq ft, seconded by aggressive plans for

expansion to meet growing customer needs, Mahindra Logistics will soon have a

dominant presence in the warehousing segment.

The Mahindra Group with revenue of US $6.7 billion is among the top 10

industrial houses in India. Mahindra is the market leader in multi-utility vehicles in India

and the only Indian company to figure amongst the top tractor brands in the world.The Group has a leading presence in key sectors of the Indian economy, including the

financial services, trade, retail and logistics, automotive components, after-market,

information technology and infrastructure development.

INDUSTRY VERTICALS:

Mahindra Logistics has a dominant position both in the Supply Chain Logistics

and People Logistics space - a unique amongst logistics service providers. Our focus on

select industry verticals ensures that we successfully partner with our customers and

deliver value to them by offering customized integrated logistics solutions. Our

comprehensive and timely service support allows them to focus on their core business

areas.

SUPPLY CHAIN SOLUTIONS:

Mahindra Logistics offers end-to-end supply chain solutions in key industry

verticals ofAutomotive,Retail,Telecom,Pharma & Express. After having developed

expertise and proficiency in the automotive supply chain we have successfully

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http://www.mahindralogistics.com/Automotive.htmlhttp://www.mahindralogistics.com/Retails.htmlhttp://www.mahindralogistics.com/Retails.htmlhttp://www.mahindralogistics.com/Retails.htmlhttp://www.mahindralogistics.com/Telecom.htmlhttp://www.mahindralogistics.com/Telecom.htmlhttp://www.mahindralogistics.com/Pharmaceutical.htmlhttp://www.mahindralogistics.com/Express.htmlhttp://www.mahindralogistics.com/Express.htmlhttp://www.mahindralogistics.com/Retails.htmlhttp://www.mahindralogistics.com/Telecom.htmlhttp://www.mahindralogistics.com/Pharmaceutical.htmlhttp://www.mahindralogistics.com/Express.htmlhttp://www.mahindralogistics.com/Automotive.html


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diversified into other industries like organized retail, infrastructure logistics for telecom,

specialized logistics requirements of Pharma & express industries.

PRODUCTS & SERVICES:

Mahindra Logistics Products & Services are designed to support the complete

customer value chain. We leverage our infrastructure, networks, industry knowledge and

experience to deliver integrated solutions for complex business needs. Our expert team

works closely with you to understand your unique business flow, challenges and needs.

Our experience in Logistics helps you get the most effective solution customized to give

your business the cutting edge advantage.

WAREHOUSING:

Mahindra Logistics warehouses blend modern systems and equipment with

industry-best-practices to bring optimization and enhanced service levels. With over 3

million sq ft space spread across the country, Mahindra Logistics is able to provide

warehousing solutions to companies with wide and diverse needs.

Mahindra Logistics offer specialized warehousing for various industries,

including, Automotive, Pharmaceutical, Telecom, Retail, Express and Others. Our

storage facilities include ambient, temperature-controlled, racked and bulk storage.

Through our solutions we offer,

Increased throughput.

Adherence to environment, health & safety standards.

Value added services support & Inventory accuracy.

Inventory visibility, Storage space optimization.

Transaction audit trail & Data exchange. EDI/API formats.

Travel path optimization.

Accurate order serviceability.

MULTI MODAL TRANSPORTATION:

Mahindra Logistics through its extensive network meets the customer

requirements of a multi modal transportation solution in the supply chain effectively.

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Mahindra Logistics is also working towards consolidating the Transportation Industry

through a new business model of consortium and communities.

Multi-modal transportation capability helps in,

Freight optimization.

Leverage our current network and scale of transportation business.

Creating value for our customers and business partners.

Standardization of process and business practices.

Control on service deliverables.

QUICK FACTS ABOUT MAHINDRA LOGISTICS

100% subsidiary of M&M

More than200 customers ( Fortune 500 companies)

Managing more than34 automotive plants

22,00,000 sq feet warehousing space

Fleet of 20,000 vehicles

26 offices

2000 employees

ORGANIZATION STRUCTURE OF MAHINDRA LOGISTICS,

BRANCH-SATARA

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Satara branch address|:

Mahindra Logistics

Sahyadri Motors Pvt. Ltd.Old MIDC, Satara-410002

Company Head Office Address:

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Registered Office:

Mahindra Towers, P. Kurne Marg, Worli, Mumbai - 400018.

Head Office:

Mahindra Logistics,

Ground floor, Mahindra Towers,

G.M Bhosale Marg,

Worli,

Mumbai- 400018

India

Phone - +91 22 24916674

Fax - +91 22 24919681

Sub-Branch Offices in West Maharashtra under Sahyadri Motors Pvt. Ltd.

1. Sangali

2. Satara

3. Karad

4. Islampur

5. Pune

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CHAPTER NO. 3

THEORETICAL BACKGROUND

2.1) INTRODUCTION:

Even with the increased recognition of the term logistics, however, there is still

confusion about the definition of logistics or what it really means. Some of the confusioncan be traced to the fact that there are a number of terms that are sued by individuals

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when they refer to what has been described in this chapter. For example, consider the

following list:

Logistics management

Business logistics management

Integrated logistics management

Materials management

Physical distribution management

Marketing logistics

Industrial logistics

Distribution

Logistics management is the most widely accepted term and encompasses logistics

not only in the private business sector but also in the public/government and nonprofit

sectors. In addition, service companies including banks, hospitals, restaurants, hotels, and

so on have logistics challenges and issues, and logistics management is an appropriate

form for the service industry.

The Term Logistics

1. The Chinese word logistics appears in the days of Chu-Han empire, China.

The story of The Three Heroes in the Early Han is the idiosyncratic and valuable

resources to define the term logistics.

The logistics of Chang Liang is a sort of military strategy which requires the

mastery in classical texts and tactics, and the combination of personal wisdom and

environmental resources for providing the commander in chief with successful tactics for

making decision and issuing orders to the field commander and soldier so as to attack

cities and capture territories in a blow.

In the struggle of Chu-Han, while Hsiao Hos protectively and completely

transporting foods and supplies by land and by water for avoiding the shortage of civilian

and military goods as well as materials in Guanzhong (around Xian area) is no doubt the

most valuable logistics practice in creating sustained competitive advantage.

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2. The English word logistics appears to have been derived from both the Greek

word logistikos and the French word logistique. Logistikos is rooted in the concept

of logic and means skilled in calculation. In addition to logistique, it is probably

influenced by the French loger meaning to quarter (or lodge) soldiers. Hence, the

combination of logic, calculation, and quartering soldiers appears to have yielded the

word. The term logistics entered military terminology in 18"' century. There were three

principal types of logistics utility in the military context, include encamping and

quartering troops, and stocking of supply depots.

The term logistics was first employed in a formal sense in the American lexicon

in the late 19th century. Rear Admiral Alfred T. Mahan, American naval strategist,

introduced the word logistics into the US Navy (Ostirowski, 1996). The term received awritten definition in 1905: logistics is a branch of the art of war pertaining to the

movement and supply of armies (Baker, 1905). Until World War II, the term logistics

began to be used pervasively to describe the support of military forces and their

equipment.

Beginning in the 1960s, logistical support of weapon systems became an integral

part of the planning and design stages of these systems. Logistics was focused on

engineering issues, calculating initial support requirements, and programming resources

to keep a system operational after introduction. The Persian Gulf War (Jan. 16, 1991

April 6, 1991) probably contributed to increased recognition because of the frequent

mention by news commentators of the logistical challenges associated with the so-called

7,000-mile supply pipeline to support the war effort in the Persian Gulf countries.

3. Era of business logistics.

The term logistics migrated to the business sector under the label of physical distribution,

which had a focus on the outbound side of the logistics system (see Figure 1).

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FLOW

Figure1. A simple logistics channelThe logistics concept began to appear in the business-related literature in the

1960s as academicians in marketing saw potential in applying the principles of military

logistics to physical distribution of consumer goods (Langley, 1986). Business logistics

evolved into a dichotomy of Inbound logistics (materials management or physical

supply) to support production, where the plant is the customer outbound logistics

(physical distribution of product) to support external customers.

4. Beginning in the 1970s, the term logistics crept into the lexicon of the common

culture. Event logistics has been defined as "the activities between the event and chaos.

Logistics is now being used with regard to the supply support of activities from church

picnics to the Olympics. The popular press has written of the logistics of waging a

Presidential campaign.

5. It is time to emergency logistics. During the US famine relief efforts in

Bangladesh in 1974 and in Somalia in 1992 and 1993, logistics was applied to deal with

emergency cases. Logistics was applied to the distribution of food (Logistics Handbook

for Relief and Development, 1987) Logistics was applied to provide relief to victims of

the floods in Honduras in 1998 and of recent hurricanes.

6. From logistics to supply chain management, most recently, the business

community began viewing logistics as a component of a larger evolving concept, supply

chain management (SCM). SCM is a linking of all Firms up and down the supply chain

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(from ultimate material sources to ultimate customers) in a collaborative and seamless

network (Blazer and Westbrook, 1995). SCM is the collaborative integration of all

logistics processes by all players in a chain, from original suppliers through end users.

The process is a customer-driven system involving the sharing of information,

risks, and assets among partners to achieve an integrated, seamless, responsive

distribution system. SCM literature views business logistics as a component of supply

chain management. It is differentiated from logistics in that it involves all partners

(suppliers, carriers, other distribution channel participants, and customers) up and down

the supply chain and, hence, is more than the internal integration of logistics activities

within a firm. (Cooper, Lambert, and Pagh, 1997). The key concepts of SCM are pull

system, customer-driven, strategic alliances, shared data, and system (as opposed to firm)optimization.

2.2) WHAT IS LOGISTICS?

Logistics is the management of the flow of goods, information and other

resources, including energy and people, between the point of origin and the point of

consumption in order to meet the requirements of consumers (frequently, and originally,

military organizations). Logistics involves the integration of information, transportation,

inventory, warehousing, material-handling, and packaging, and occasionally security.

Logistics is a channel of the supply chain which adds the value of time and place utility.

Today the complexity of production logistics can be modeled, analyzed, visualized and

optimized by plant simulation software.

2.3) WHAT IS LOGISTICS MANAGEMENT?

Logistics management is that part of the supply chain which plans, implements

and controls the efficient, effective forward and reverse flow and storage of goods,

services and related information between the point of origin and the point of

consumption in order to meet customer & legal requirements. Logistics management is

the governance of supply chain functions.

Logistics management activities typically include inbound and outbound

transportation management, fleet management, warehousing, materials handling, order

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fulfillment, logistics network design, inventory management, supply/demand planning,

and management of third party logistics services providers.

To varying degrees, the logistics function also includes customer service,

sourcing and procurement, production planning and scheduling, packaging and assembly.

Logistics management is part of all levels of planning and execution -- strategic,

operational and tactical. It is an integrating function, which coordinates all logistics

activities, as well as integrates logistics activities with other functions including

marketing, sales manufacturing, finance, and information technology.

2.4) DEFINITIONS OF LOGISTICS:

Logistics as a concept and a practice has evolved over the years and is adiscipline that is now practiced in different ways and contexts. Logistics means different

things to different people so far. Even professionals in the field differ as to what logistics

actually means. Part of the definition problem is also traceable to the fact that logistics

has been described by a variety of sources that have somewhat different perspectives.

The viewpoint of inventory

Logistics is managing the flow and stock of materials, or

Logistics is the management of materials in motion and at rest.

The viewpoint of dictionary

Logistics is purely a branch of military science having to do with procuring, maintaining,

and transporting material, personnel, and facilities.

A New Logistics Paradigm

1. Military logistics

2. Engineering logistics

3. Emergency logistics

4. Event logistics

5. Process logistics

6. Service logistics

7. Business logistics

2.5) PRIMARY RESPONSIBILITIES OF LOGISTICS MANAGEMENT ARE:

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To identify all activities that will be involved in providing needed logistical

support.

To integrate the actions required of each activity into a comprehensive logistics

plan in support of or to be incorporated into overall program plans;

To monitor progress toward meeting the logistics plan and to identify the cause

and impact of delays or other problems (varying degrees of responsibility for

taking actions to prevent or overcome such problems may also be included).

To adjust plans and schedules for all related actions as required by delays or

changes to logistics requirements; and

To evaluate plans and provision of logistical support for feasibility, efficiency,

economy and to develop alternatives when required.

The determination of detailed requirements, within available or allocated

resources, for funds, manpower, facilities, equipment, supplies, and services;

The design and development, procurement, production, storage, distribution,

maintenance, transportation, utilization, and disposal of material;

The procurement or design and construction, operation, maintenance, and

disposal of facilities;

2.6) LOGISTICS AS BACKBONE FOR ANY BUSINESS:

1. The customer in todays marketplace is more demanding, not just of product

but also of services.

2. In todays marketplace the order winning criteria are more likely to be service

based then product based.

3. Logistics Management can provide a multitude of ways to increase efficiency

and productivity and hence contribute significantly to reduce unit costs.4. The scope of logistic spans the organization, from management of raw material

through to the delivery of final product.

2.7) TRANSPORTATION MANAGEMENT:

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Transport or transportation is the movement of people and goods from one

location to another. Transport is performed by modes, such as air, rail, road, water, cable,

pipeline and space. The field can be divided into infrastructure, vehicles, and operations.

Given the facility and information capabilities, transportation is the operational area of

logistics that geographically position inventory. In this section company try to apply the

transportation function, planning that goes into the choosing of right kind of carrier,

service according to the different requirement of different industries and integrating the

whole process with other supply chain function for total operation efficiency.

2.8) TRANSPORTATION MANAGEMENT:

Improves plan optimization and consolidation by optimizing transportation plansacross multi-period transportation and daily plans and schedules.

Transportation Planning helps companies like,

Lower transportation costs

Enhance service levels

Decrease cycle time

Increase profits from bidding and backhaul

2.9) TRANSPORTATION PROCUREMENT:

Enhances carrier selection and reduces costs through constraint-based bid

optimization, analysis, and awarding. Optimal bids and carriers are selected based on

combinations of lane bundles, price, and service.

Transportation Procurement helps companies like,

Gain visibility across multiple carriers

Lower transportation costs 5-10%

Decrease time to transportation procurement

Boost transportation reliability

Increase information for negotiating bids with carriers

2.10) ROUTE PLANNING:

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Determine the best routes through sophisticated optimization, analysis, and

scheduling tools to improve routing, driver, and asset utilization.

Route Planning helps companies like,

Lower transportation and routing cost 5-7%

Increase asset utilization

Boost service levels 5-10%

Automate routing processes

Improve customer service

2.11) SMALL PARCEL SHIPPING (SPS):

Simplify the fulfillment of parcel manifesting requirements; expand to meet

increases in order volume; benefit from rating, labeling, and electronic reporting features

for managing small parcel shipments more efficiently.

Small Parcel Shipping helps companies like,

Realize impressive cost savings

Improve supply chain visibility

Optimize fulfillment processes

Enhance customer service

2.12)WAREHOUSING MANAGEMENT:

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The user of the item, which might require the parts, may overlook the economic

considerations because the expense is not the users, but the suppliers of a known high

rate of failure of certain equipment of delays in getting the part from a vendor or a supply

room, resulting in machine outage to have the parts on hand requires less paperwork

when the parts are suddenly needed of the mental comfort it provides to the user in

knowing the parts are on-hand when needed. The parts are un-economic to be repaired

i.e., its cheaper to discard then to get it repaired.

Cost-effect compromise

In many cases where the item is not stationary, a compromise is reached between cost

and statistical probability.Some examples:

An automobile carries a less-functional donut tire as replacement instead of a

functionally-equivalent tire.

A member of a household buys extra light bulbs since it is probable that one of

the lights in the house will eventually burn out and require replacement.

A computer user will purchase a ream of computer paper instead of a sheet at a

time.

A race car team will bring with them to the race track another engine, just in

case.

A ship carries spare parts for its engine in case of breakdown at sea.

Measures of effectiveness:

The effectiveness of spares inventory can be measured by metrics such as fill rate

and availability of the end item.

2.15) INVENTORY MANAGEMENT:

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A method of inventory control to indicate a broad framework for managing

inventories efficiently in conformity with the goal of wealth- maximization. The major

problem-areas that comprise the heart of inventory controls are

(i) The classification problem to determine the type of control required

(ii) The order quantity problem

(iii)The order point problem and

(iv)Safety stocks

2.16) ABC ANALYSIS:

ABC analysis is a business term used to define an inventory categorization

technique often used in material management. It is also known as selective inventorycontrol.ABC analysis provides a mechanism for identifying items that will have a

significant impact on overall inventory cost, while also providing a mechanism for

identifying different categories of stock that will require different management and

controls.

When carrying out an ABC analysis, inventory items are valued (item cost

multiplied by quantity issued/consumed in period) with the results then ranked. The

results are then grouped typically into three bands. These bands are called ABC codes.

ABC codes:

"A class" inventory will typically contain items that account for 80% of total

value, or 20% of total items.

"B class" inventory will have around 15% of total value, or 30% of total items.

"C class" inventory will account for the remaining 5%, or 50% of total items.

ABC Analysis is similar to the Pareto principle in that the "A class" group will

typically account for a large proportion of the overall value but a small

percentage of the overall volume of inventory.

Another recommended breakdown of ABC classes:

"A" approximately 10% of items or 66.6% of value

"B" approximately 20% of items or 23.3% of value

"C" approximately 70% of items or 10.1% of value

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CHAPTER NO.4

RESEARCH

METHODOLOGY

3.1) RESEARCH METHODOLOGY OF STUDY:

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CHAPTER NO. 5

PROJECT ANALYSIS

LOGISTIC MANAGEMENT

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Before understanding Logistic Management, I want to tell you about logistic

department of the Mahindra Logistics. Here Mr. A.S.Avhad is logistic manager and he is

very experience person in the field of the transportation. In this company he is doing the

outbound logistic. Logistic Management has very large scope in the todays world. The

developing country has very large scope but for they need such Service like

transportation, communication, electricity. Here we are going to understand the very

important concept that is logistic. Logistics involves a complex series of relationships

and interactions among the different divisions of an organization. Logistic shows us how

this entire process can be managed so as to increase the efficiency of the organization.

Service organizations relate with his suppliers & customers that will manage very

efficiently and it will give competitive edge, over his rivals, and the benefits customer

can reap from his company. Logistic covers a range of operations and activities

depending on this relationship. It not only involves the co-ordination of supply to the

final consumers, but also movement of a product within and outside the organization. In

other words, the term distribution encompasses all movements of the product.

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Logistics is the management of the flow of goods, information and other

resources, including energy and people, between the point of origin and the point

of consumption in order to meet the requirements of consumers. Logistics

involves the integration of information, transportation, and inventory,

warehousing, material-handling, and packaging. Logistics is a channel of the

supply chain which adds the value of time and place utility. We cant imagine any

business without logistics.

Logistic is that part of Supply Chain process that plans, implements and controls

the efficient, effective flow of and storage of goods, services and related

information from the point of consumption in order to meet the customers,

requirement.It is only in the last 20 years or so that the concept of Logistic Management has

emerged and developed into a separate, recognizable management functions. Like many

other new business concepts, Logistic Management also originated in US. It is founded

on a practical fundamental principle, i.e. the cost of storage and movement are closely

interrelated and by dealing with them as a single unified activity, can we achieve or

realize the true potential of each. In a crux it can be said that Logistic Management aims

at seven R's.

SEVEN Rs:

Right product

Right quantity

Right condition

Right time

Right place

Right customer

Right cost

Peter Drucker described physical distribution as the "last frontier of cost

reduction". Using skilled management and modern technology for inventory

management, inventory processing and transportation can reduce cost.

LOGISTICS AS BACKBONE FOR OUR BUSINESS

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1. The customer in todays marketplace is more demanding, not just of product but also

of services. In todays marketplace the order winning criteria are more likely to be

service based then product based.

2. Logistics Management can provide a multitude of ways to increase efficiency and

productivity and hence contribute significantly to reduce unit costs.

3. The scope of logistic spans the organization, from management of raw material

through to the delivery of final product.

LOGISTICS MATRIX

Companies which have productivity advantage are known as cost leaders and

which have value advantage are known as service leader. Companies which dont have

any advantage fall under commodity market and companies like Mahindra Logistics Ltd.

which have both productivity as well as value advantage fall under the category of

service and cost leader.

FUNCTIONS OF OUR LOGISTICS DEPARTMENT

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Logistics, the synonymous term of physical distribution, involves planning,

Implementing, and controlling the physical flow of materials from the point of origin to

the point of the consumer at a profit. The role of logistics is to get the right amount of

product to the right places in the right time.

Logistics or physical distribution (PD): Planning, implementing, and controlling

the physical flows of materials and final goods from points of origin to points of use to

meet customers needs at a profit & Supply chain management emphasizes close

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cooperation and comprehensive inter organizational management to integrate the

logistical operations of the different firms in the channel.

Before going to the main activities of the logistics management we thinks about spare

parts, lubricants, etc. of the company and thinks about how we are purchasing it. Here we

are going to understand the purchase process of the Mahindra Logistic.

PURCHACE PROCEDURE OF MAHINDRA LOGISTICS PVT.LTD

Purchase process is very important part of the our origination. Here the work is

undertaken by the Mr. R. A. Vagh as the purchase manager and he is reporting to Mr.

Avad as the General Manager of the Mahindra Logistics, satara. So start the process

with Purchase department receives indent (Requirement note) from the department which

needs any material, the indent is signed by Indenter, Store, HOD and GM.

After receiving indent purchase department inquire for competitive rates from

different supplier of the product, they get competitive quotations from these suppliers,

than they make a comparison sheet of that product in which they compare about the rates

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and delivery time of the suppliers and select the best alternative from the available

suppliers, a purchase order is made by department which is given to supplier and

accordingly supplier dispatch the consignment, material is received by store and GRN is

made by store which is forwarded to purchase department. Purchase department forward

this GRN with bill of the material to accounts department, then account department make

the payment according to terms and conditions.

MATERIAL HANDLING:

We believe that efficient and careful material handling methods in organization

and distribution warehouses can contribute much to customer satisfaction. Proper

material handling helps to,1. Decrease the damage

2. Maintain the quality of storage

3. Facilitate order processing

4. Move right goods at right time to make them available to right customers.

All the more, material-handling function of physical distribution helps to reduce

the number of staff required for managing inventory and also, the dangers of

obsolescence. We try to reduce the maintenance cost. The need for material handling had

always been there at various stages of production and distribution. The cost of such

activities can represent anything up to 50 per cent of total production cost. Physical

distribution aims at reducing this cost through development material handling techniques.

These developments have been phenomenal in recent years. The improved techniques are

not confined to production only, but have also been carried forward to other phases,

dealing with physical movement of goods. The benefits of these improvements are

therefore, not only reaped by manufacturers but also by consignee, as he too gets his

products in perfect condition and in a short time.

ORDER PROCESSING:

Order Cycle

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Time to complete the activities of the order cycle is at the very heart of

customer Service. It has been estimated that the activities associated with order

preparation, transmission, entry, and filling represent 50 per cent to 70 per cent order

cycle time in many industries. Due to this, activities involved in processing company's

orders are receiving more and more management attention. As it is closely related to sale

and production, order processing should also be a part of physical distribution

department. Effective order processing should begin with transmission of orders

information, continue uninterruptedly through stock checking, accuracy checking, credit

checking, back ordering, transcription and billing, to move on to order filling.

Along the way, it should also have an efficient order status reporting system. With so

many departments involved in processing orders, delay can occur at any stage. It is the

responsibility of physical distribution manager to see that sluggishness does not occur.

INVENTORY CONTROL:

Mahindra Logistics usually believe that if too high an inventory level is

maintained then they would have to bear a very high inventory carrying cost and also ahigh risk of obsolesce. On the other hand, if too inventory is maintained, then it would

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result in high restocking and maintenance cost, as balance between the two extremes

need to be achieved. This can be done by related factors like movement and storage. This

function of physical distribution is called inventory control. The decision concerning

when and how much to order is a matter of balancing various conflict cost functions.

Inventory control aims at minimizing inventory cost, subject to demand and service

constraint.

Inventory control guides a firm on factors such as

1. How much to order?

2. When to order?

3. How to control stock-outs at lowest cost?,etc.

For this purpose we use various inventory controlling techniques some are, ABC Analysis

VED Analysis

SDE Analysis

FSN Analysis, etc.

Commonly ABC & VED Analysis combined is very helpful for us in inventory

control of spare parts. Here I just did ABC analysis of Mahindra Commercial Vehicles

for the study purpose in new way i.e. through excel sheet.

ABC Analysis of Mahindra Commercial Vehicles

What you will learn from this handout

To do an ABC analysis of inventory items in Excel

To sort data in Excel, using the data in a particular column as a basis for sorting

To compute cumulative sums in Excel.

Steps in the ABC Analysis:

We are given item numbers, annual demand, and unit price for 39inventory items. A

spreadsheet for this problem is shown below. In the workbook, this is Sheet 1.

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Steps:

Annual usage in Rs. = (annual demand) x (unit price).

Develop an Excel formula for the annual usage of Item M-11 (cell F6). Copy cell

F6 to cells F7-F34.

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Develop an Excel formula for Total Annual Usage (cell F35).

We need to compute the percentage of annual usage for each item. The formula

for cell G6 is =F6/F35. Enter the formula, and format the answer as a percentage.

Copy cell G6 to cells G7-G34.

Save your file.

Your assignment must include both sorted and unsorted versions of your work.

Copy your spreadsheet to Sheet 2.

In Sheet 2, sort the data by Annual Usage, in descending order.

Sorting Data in Office 2007:

We want to sort cells C6-G34. Highlight those cells, as shown below.

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Click the Sort & Filter editing tool in the upper right hand corner in the tool bar.

Select the Custom Sort option.

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This screen should appear.

Under the Sort by Column use the Percentage value. Under the Order

Column order from largest to smallest.

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Select OK. The box should disappear, and the data should be sorted from

largest to smallest percentage.

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WAREHOUSING AND STORE DEPARTMENT:

Mahindra Logistics warehousing refers to storing materials like Spare parts,

lubricants, etc while they wait to be sold. Mahindra Logistics use either warehouses or

distribution centers to process their Spare parts, lubricants, etc. The choice is made in

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regard to the transportation cost, amount of customer service and level of inventories. A

company, if it chooses to maintain a warehouse, has to go for either a public or a private

warehouse. Private warehouse offers greater flexibility in design to meet the storage and

handling need. It also provides more control over the activities carried on in the

Warehouse Public warehouse requires no fixed investment by the firm and offers

location flexibility and ability to increase the warehouse space to cover peak

requirements. Now-a-days Mahindra Logistics often opt for distribution centers to store

and distribute Spare parts, lubricants, etc. A distribution center is a large, highly

automated warehouse, designed to receive Spare parts, lubricants, etc from Mahindra

and-supplier.

FUNCTIONING OF STORE AT MAHINDRA LOGISTICS PVT LTD

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Stock of all items other than lubricants is maintained by store. Store receives

requirement (Issue sleep) or requisition from the department which is signed by

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department head or by any customer, then it checks in the stock if stock of those goods,

spare parts, etc is available. Then store issue that material to the department and if

material is not available then they ask for indent from the department which is verified

by store and forwarded to purchase department and receives goods, goods are checked by

store and if they are as per specification they keep that in stock, make a GRN and issue to

demanding department and if it is not as per specification then reject that material and

return to supplier.

For records and inventory management store uses AGN software through

which they keep records of inventory as well as positioning (where which product is

located). In that the AGN software is very useful for each step of the origination. This

software is handling all the activities of the Mahindra Logistics and also its helps to ourPune Branch office. They are also access the AGN by their specific id. Here the all the

warehouse of the company can also access and see the goods and goods in transits by the

help of the software. Software is very useful but the software has limitation of the 40

users in one branch.

PACKING :

Packaging cost is a part of the total cost of distribution. Mahindra Logistics always

try for making improvements in packaging techniques. In Mahindra Logistics, physical

distribution department, in order to fulfill this function, has to work in cooperation with

sales and manufacturing department, and deliver the products in their best quality and

condition in the consumer hands. Thus, a systems approach is required to enable one

department to share its specialized knowledge with the other departments, and in turn,

fulfill the objective of the organization.

In fact, in Mahindra Logistics, logistics system design begins with the packaging

files that document the dimensions and capacity of all packages that flow through a

companys facilities. Second, packaging is important for the many different ways in

which it influences and is influenced by the logistics and all service activities, not only

within a company but also with suppliers and customers.

FUNCTIONING OF PACKING DEPARTMENT:

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In Mahindra Logistic, packaging department recieves the demand and dispatch

schedule and than plans the packaging accordingly. Packaging department look

after the inventory of packaged Spares and also inventory of packaging material.

Dispatch schedule is transferred to logistics department to deliver the goods to

final destination.

Packaging department generates reports in AGN and the copy of reports are

mailed to concern departments.

Packaging department is responsible for correct and timely packaging of goods,

dispatch and loading of goods and for any errors like overfilling and underfilling,

leakage etc.

TRANSPORTATION MANAGEMENT:

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We believe that transportation is essential in Physical distribution. It deals with

movements of Spare Parts, lubricants, etc to the market.

Problems in transportation services can lead to a company retaining the inventory

for several days; more than physical distribution had planned for. This increases

inventory-carrying cost and decreases the number of times inventory is converted into

cash. Thus, efficient transportation planning and management is a prerequisite function

of physical distribution. There are five ways of transport such as Rail, Air, Road,

Pipeline and Waterways but Mahindra Logistics in Maharashtra only uses Rail, Road &Air transports.

RAIL ROADSLONG DISTANCE SHIPPING:

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Railroads continue to present an efficient mode for the movement of bulky

commodities over long distances. These commodities include weighted spares, bulky

lubricants, Accidental vehicles for company use, etc.

OUTBOUND LOGISTIC THROUGH TRAIN:

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When goods, spares, etc are to be sent through goods train, company make

indent and give it to railway department, railway department gives a waiting no. and

according to that waiting no. we are sent the date when we will be availed wegons

according to that date dispatch is planned, if company have to sent Speial Parts than it is

sent through special transporters and if consumer packs than goods are sent through

trucks, vehicles are loaded with goods and sent to railway terminals, there vehicles are

unloaded in goods train and goods are sent to other places through train.

Logistic management included inbound and outbound logistic. In that there are

various mood of the transportation like Rail, Road, Air and water. Now here in Mahindra

Logistics we are related with the outbound logistic in maharashtra. Mahindra logistics

follow mainly two out of this one is Road and Rail. You can see the process which we

are following in the outbound logistic when we going to select Rail. Its very cheap

compare to the road but it may take some more time and here the rut of travelling arefixed.

TRUCKING-FLEXIBLE AND GROWING:

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In todays highly competitive business setup where advantages tend to be shoot

lined, maintaining a responsive, reliable and cost efficient products and material supply

chain is often a decisive success factor.

With this in mind, Mahindra Logistics has structured logistics as a distinct

business segment, through its company, Pune & Satara super roadways, which offers in

house capability in road transportation services and cold store, ware housing services.

To meet delivery requirements, they manage on extensive overland

transportation network of over 200 commercial bulk Trucks with a market reach

covering western region of Maharashtra. Mahindra logistics also private transportation

service facilities like GATI, OM transports, etc.

Their success in providing a high service level has increasingly attracted third

party customers as well. Customers are also guaranteed optimal service from adequate

stocks maintained at their various warehousing locations.

DISTRIBUTION NETWORK OF MAHINDRA LOGISTICS PVT.LTD

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Mahindra Logistics head office in Mumbai and most of the market are coveredby the company that are also in western region of state. The sub brancht is established in

the Kanhe at Pune and the plant is running very successfully in this area. Here the

transportation is very easy and cheap. Here two port are available one is Satara and other

one is Karad port so transfer Spare parts, lubricants etc from the various states by the

trucks we can get very easily. That is very beneficial for the company because they

saving time and money.

THE BASIC DISTRIBUTION PROCESS OF THE COMPANY

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Mahindra Logistics has set up a strong distribution network of Company

Distributors and Super Stockiest or its retail operations. This chain helps to tap even the

small retailers/traders and thus increasing our reach.

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Today Mahindra Logistics has its distribution foot prints all across the country with

various stock-points catering to more than 5000 distributors, 200 Super Stockiest and

numerous brokers and other trade associates. Mahindra Logistics retail reach is more

than 32500 outlets and its consumer reach is more than 15 corers Indians.`


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CHAPTER NO. 6

OBSERVATIONS & RECOMMENDATIONS

SWOT ANALYSIS

With the help of the observation, primary and secondary data and also analyze of

the structure of the organization, we came to know remarkable strengths and weaknesses,

opportunities and threats.

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STRENGTHS

Mahindra logistics brand name therefore theirGoodwill is very strong.

Spare Part, lubricants, etc import from the Kanhe Port which is not much far from

the Mahindra logistics Pvt. Ltd. Pune office. The distance between the Kanhe port

and the Mahindra logistics, Satara is around 90 km which is beneficial to reduce

the consumption of the fuel and the time.

Mahindra logistics tie up with many transportation or logistics companies which

are provided theirbetter services to their customer in the suitable rate/price.

Whatever company needed spare parts for the packing and all that they have own

plant for that type of Spare parts, lubricants, etc. E.g.: Boxes, Tin, jar, pouch etc.

Mahindra logistics Company has wide area so its very easy to expand thebusiness or plant.

Mahindra logistics paid very low taxes to the government because it is located in

MIDC area in satara which is charged by very low tax rate compare to developed

area.

It is located near Pune so its easy to get labors & educated and qualified

employee.

Mahindra logistics has great waste management so the waste of the Lubricants

is useful for other purpose and also they have another market to sell their

wastage.

Effective & efficient implementation of Inventory control techniques like,

ABC, VED, FSN, etc.

WEAKNESS

Mahindra logistics has large market in the western regions of state but in the

domestic market and other state has not much demand like Gujrat, Madhya

pradesh.

Mahindra logistics give less attention to the advertisement and in the

competitive world without advertisement no one can grow.

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Customer is a king of the market and they have option to buy the product but

many companies just because of the advertisement change the customer

decision.

Competition in automobile industry.

RECOMMENDATIONS

Mahindra logistics has own trucks and so here all the transportation done by the

trucks. If we use GPS (Global Positioning System) so its very helpful to known

the trucks location.

If we create a warehouse. Within a warehouse then its very easy to identify the

different product storage area. Order pickers spend about 60 percent of their time walking Spare parts,

lubricants, etc or moving them around. Consider an automated solution, they can

keep small stock in front and large stock upside so that it will be time saving.

I spend my four months in the logistic department and I find that we are using the

AGN software but software has limit of 40 users because of that reason that

DO (delivery order) cant we made but we give time to use this software at fixed

time and after use it closed the access point.

In the packing department workers not having any safety tools so provide

necessary tools of safety before any accident.

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Finally logistics management has vast scope & bright future in all types of

industries.

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CHAPTER NO. 8

BIBLIOGRAPHY

BIBLIOGRAPHY

BOOKS:

Ballou, Ronald H., Business Logistics Management, International Edition,

Prentice Hall, New Jersy, 1999, p. 660.

Basics of distribution management A logistical approach Satish K.

Kapoor and Purna Kansal. PHI 2003.

Prof. L.C.Jhamb, Inventory Management

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INTERNET

http://en.wikipedia.org/wiki/Logistics

www.google.co.in

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new project ok

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