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    A

    PROJECT REPORT

    ON

    IMPORT/EXPORT PROCEDURE & DOCUMENTATION

    AT

    FILTERCO

    NEEMUCH

    (M.P.)

    SUBMITTED TO

    UNIVERSITY OF PUNE

    BY

    PAWAN KUMAR VAISHNAV

    PGDIEM(2010-2011)

    Sinhgad Technical Education Societys

    SINHGAD INSTITUTE OF MANAGEMENT

    S. No. 44/1, Off Sinhgad Road, Vadgaon (Bk), Pune 411 041Ph: 020 -2435 8380/2435 8355 Fax: 020-2435 4835 Mob:

    S9881742711

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    Sinhgad Technical Education Societys

    SINHGAD INSTITUTE OF MANAGEMENT

    S. No. 44/1, Off Sinhgad Road, Vadgaon (Bk), Pune 411 041

    Ph: 020 -2435 8380/2435 8355 Fax: 020-2435 4835 Mob:

    9881742711

    Email: [email protected]

    CERTIFICATE

    This is to certifying that Mr. Pawan Kumar Vaishnav of Sinhgad Institute of

    Management has successfully completed the project work titled as IMPORT/

    EXPORT PROCEDURE & DOCUMENTATION at FILTERCO

    NEEMUCH (M.P.) in partial fulfillment of requirement for the award of

    PGDIEM prescribed by the SINHGAD INSTITUTE OF MANAGEMENT.

    This project is the record of authentic work carried out during the academic year

    2010-11.

    He has worked under our guidance and direction. His work is found to be

    satisfactory and complete in all respect.

    Dr. Daniel Penkar Prof. A.C. Panda

    (DIRECTOR) (PROJECT

    GUIDE)

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    mailto:[email protected]:[email protected]:[email protected]
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    PREFACETo manage a business well is to manage its future; and to manage the

    Future is to manage information. An expect of management education

    is to under go winter training into corporate world and then make an

    evolution of it. Companies offer the winter trainees wide varieties of

    interesting and challenging project to choose from as well as on the job

    training of Export Procedure and Documentation.

    Winter training requires that the student attains practical experience in

    an industrial organization for a period of about one month. The winter

    project investigates some significant aspect of problems of an

    organization. It gives students an opportunity to observe a business

    organization in operation and sharpen their knowledge and skills byputting them to use.

    Winter training enables the students to undergo research work. This

    training enables individuals to make a better informed career choice

    regarding both functional specializations and type of organization.

    Winter project being time bound has a limited scope of looking in depth

    the exact working policy of each and every department of an

    organization. Yet it is sufficient for the student to apply the management

    concept to the real life situations and at the same time enhance our skillsat judgments and creativity.

    As a Finance management student, I was exposed to the corporate

    world during my winter training at a renowned production company in

    india and in the world i.e. FILTERCO. This training help me a lot, as it

    was instrumental in making me aware of my strengths as well as

    weakness. This training has developed in me the practical and problem

    solving result oriented situational approach towards management.

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    Table of

    C O N T E N T S

    Sl. No. Title Page

    No.

    1. ACKNOWLEDGMENT

    2. OBJECTIVE

    3. INTRODUCTION

    4. INTRODUCTION OF THE COMPANY

    5. METHODOLOGY

    6. DIFFERENT DEPARTMENTS IN COMPANY

    7. EXPORT PROCEDURE IN FILTERCO

    8. OBSERVATION

    9. FINDINGS

    10. RECOMMENDATION/SUGGESTION

    11. CONCLUSION

    12. BIBLIOGRAPHY

    13. ANNEXURES

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    ACKNOWLEDGEMENT

    I express my deep sense of gratitude, indebtedness and regard to my project guide

    Mr. R.K. Sharma (Sr. Dy General Manager, Sales Co-ordination Department,

    FILTERCO, NEEMUCH M. P.) for his assiduous guidance and inspiring

    suggestions during the project report.

    I am also thankful to Pankaj Kumar, (Asst. Manager, Sales Co-ordination Dept.),

    FILTERCO for his kind co-operation in this project.

    I am also thankful to Mr. Arvind Kumar,(Manager, HRD, ) for his kind co-

    operation in this project.

    I am also thankful to Filterco for providing some lighter moments and made our

    stay pleasurable.At last we are thankful to our honorable director, Dr. Daniel

    Penkar, and project guide and co-ordinator Mr. A.C. Panda.

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    OBJECTIVE

    Project objective:

    a. To understand the FILTERCO Business Processes.

    b. To understand the working of the various of department of

    FILTERCO contributing towards processing an export order.

    c. To understand the role of Merchandisers in FILTERCO.

    d. Export Procedure.

    e . Export documents.

    f. Documents required for negotiation, purchase, discounting.

    g. Steps in export letter of credit.

    h . Mode of payment.

    i . Different ways of consignment.

    Objective of the study

    1. To study the registration procedure for the export.

    2. To find out the international business Scenario.

    3. To study the export procedure and documentation for FILTER

    CO.

    4. To find out the procedure for the membership in export

    promotion council and DGFT.

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    5. To find out the difficulties in export procedure and

    documentation .

    SCOPE:

    1. The scope encircle export procedure and documentation of

    FILTER CO

    2. Pre-shipment and post shipment documentation in export are

    studied in detail.

    3. The tribulation faced by FILTER CO .

    4. Study of area of exporting new market and diversification of the

    product.

    5. Study of international buying behavior.

    LIMITATIONS:

    Export procedure is very vast area and so training program of 50

    days is insufficient.

    1. As the working place being away from the actual export

    procedure transition hence only theoretical aspects of the export

    procedure could be covered.

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    INTRODUCTION

    Background of the problem task undertaken

    IT IS an opportunity to do the summer internship in the FILTERCO

    Industry which is manufacture and the exporter of the pressed wool

    felts. As we know, exporting is the complex and challenging activity

    in todays dynamic world environment as it involves the performance

    of operation that determine existing and potential demand in market.

    Learning the step-by-step processes and procedure to be followed in

    an export contact is a crucial activity in export procedures, selecting

    the project on export procedure is an obvious and important decision.

    STATUS OF INDUSTRY :

    The textile industry in India occupies a unique position in our

    economy contributing to nearly a third of the countrys export

    earnings. This industry manufacturers, suppliers, wholesalers

    and exporters of cotton textiles, handloom, woolen textiles etc.

    From the production of textile machinery and equipment, dyes

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    and raw materials to the delivery of finished textiles, fabric

    and garments the textile industry in India has the vast potential

    for creation in of employment as it Textiles industry is the

    second major employer in India after agriculture, providing

    employment to 91 million people according to an ASSOCHAM

    Eco Pulse study titled India Textile Scenario. The number of

    textiles manufacture, suppliers, wholesalers and textiles export

    in India is counted among the most impor tant sector.

    It contributes about 13 per cent in export earning and 4 per

    cent in Indias GDP is s til l suffering the heat of global

    slowdown as indicated by declining exports and massive

    layoffs. Textile exports during April-March 2008-09 registered

    a decline of 1.71 per cent from USD 22.13 billion in April-

    March 2007-08 to USD 21.75 billion. Among the maximum hit

    segments, handicrafts registered maximum decline of 48.35 per

    cent in 2008-09, from USD 3481.14 million in 2007-08 to USD

    1797.88 million. sector registered 50 per cent increase in

    investment during 2008-09 to Rs.49,613 crore from

    Rs.31,161 crore in 2007-08. But as compared to the year 2006-

    07 the sector registered 48 per cent decline in investment.

    However, in 2006-07, Rs.90,369 crore of investment was

    poured in texti le sector . According to the Chamber, an

    investment of Rupees one lakh in power loom sector creates

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    about three jobs, hence the government should create an

    investment friendly environment and provide low interest rate

    loans to investors and should also provide export profits be

    made tax-free in slow down period to encourage the export.

    How have textile exports performed against this backdrop?

    Fortunately, after a period of low activity, the scenario is fast

    undergoing a change for the better and in a positive direction

    leading to higher growth. As Indian textile industry, which has

    accelerated to an annual growth of 9 -10 per cent , is expected

    to grow at rate of 16 per can in values and reach a level of

    USD 115 billion by 2012 , UNION MINSTER STATE FOR

    TEXTILES E V K S Elangovan said that growth can be

    fuelled by both exports as well as a rise in domestic

    consumption, resulting in India's share in the global textile and

    clothing trade moving up from the current three per cent to

    seven per cent by 2012.

    This trend augurs well for India and is a clear indication of

    a shift in production base from raw materials to value added

    products with the VALUE being captured by Indian

    producers. With all forecasts by leading analyst , pointing

    towards greater trade in INTERNATIONAL MARKETS in

    processed/ finished goods rather than raw materials, Indian

    appears to be positioning itself well to increase its market

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    share in WORLD trade in merchandise export. The

    ASSOCHAM has stated that despite marked improvement in

    the f inancial posit ion, the Indian texti le continue to face

    serious issues involving transaction cost and raw material. The

    government should focus on infrastructure facility related to

    the supply chain and provide low cost logistics service to the

    sector.

    The sector suffers from high power cost and lack of power

    supply. Effective power management system has to be put inplace. States should offer power at low cost on the incentive

    based system for the new investment made in the textile

    industry for commercial production. The sector requires higher

    technology up gradation and active involvement of new

    technology. ASSOCHAM recommended that government

    should further increase funds under the Technology Up

    gradation Fund Scheme (TUFS) for textile firms from Rs 3140

    crore to Rs 4500 crore and release appropr iate funds to clear

    the existing backlog of subsidy payments and upgrade

    technology of textile units.

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    INTRODUCTION OF THE COMPANY

    COMPANY PROFILE:

    FILTERCO company is a 50 cr US dollar textile conglomerate

    driving critical industries. They are century old pioneers in their

    area of specialization like of wool felt rolls ,sheets, seals, wicks,

    gaskets, strips, felt polishing wheels, knife edge discs, cones,

    mounted felt bobs etc.The organization is manufacturing Pressed

    Wool Felts since 1968. The quality consciousness, competitive

    pricing and the capaci ty to sat isfy the customer' s specific

    requirements have given us a firm footing in marketing their

    products successfully at home and abroad. They have complete

    manufacturing expertise to manufacture Pressed Wool Felts

    conforming to all International standards.

    They also have their associate Units where they have facilities

    like Slitters, Cutters, Hydro-Pnuematic Presses, CNC Kiss cut

    Press, Hydraulic Presses, Splitting Machines, Vacuum

    Impregnation Plants, Adhesive Coating/Lamination machines and

    tool room for Die making etc. These facilities enable them to

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    fabricate the Custom-built parts to suit individual customers

    requirements. This organization is made up of four major groups,

    each led by the best manufacturing and managerial talent in India.

    In addition to manufacturing they have interest in civic utility

    systems. This unit, multi-products, multi-location conglomerate is

    built on the plinths of experience, expertise, quality, innovation &

    values in the business. Their best play is successful work &

    creation of a new industrial order they can provide tailor made

    solution to the customers. At Filterco, listening the customers and

    his needs is a tradition as old as the group itself. For it is they

    who drive us future, make us reach higher & better solutions. In

    the customers often unspoken wish for better implements lies the

    seed for a new invention, a path-breaking industr ial concept.

    COMPANY DIVISION:

    The groups consist of 4-companies from the core of filterco Groups. Eachcompany is a renowned name in its own area of operation and is respected

    world wide for its service & products. For us manufacturing is not just a

    limited to our factory premises & our products. It is also about wor ld class

    services.

    FILTERCO .PVT LTD.

    SEAL WELL.

    BLUE CHIP.

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    TEX FELT.

    Companys Achievement:

    Reward and recognition

    They are awarded for the Highest Exports by the Govt. Of India for the

    last 6 years in a row which speaks volumes about their satisfied

    customers all over the world.

    IN 1986 The CEO Mr. D.S.CHORDIA receiving the Udyog Patra

    Award from Mr. M.HIDEYATULLAH,PM of India at FICCI

    auditorium, NEW DELHI on 20 t h December 1986.

    In 1992-1993 Certificate of merit in hair belling felts.

    In1992-1993 Award for the highest export performance.

    In 1993-1994 Certificate of merit in hair belling felts.

    In 1994-1995 Award for the highest export performance.

    In 1995-1996 Biggest Export performance

    In 1995-1996 Certificate of merit in hair belling felts.

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    In 1996-1997 Biggest Export performance.

    In 1997-1998 Award for the highest export performance.

    In 1998-1999Award for the second biggest export

    performance.

    In 1999-2000 Biggest Export performance.

    From 2000-2007 Biggest Export performance.

    FILTERCO CAPACITIES

    SECTION CAPACITIES(monthly) kg

    Felts sleeve Roller Covering

    80,000

    Felt Flap Wheels and discs 110,000

    Wool felt polishing Wheels and

    Discs

    90,000

    Felt and Non-Woven rolls 100,000

    Industrial felts component 80,000

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    Woolen felt planting sheet 100,000

    CLIENT COUNTRIES INTERNATIONAL CLIENT:

    CUSTOMER CLIENT

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    Technofeltro.

    Lampe technical.

    Joh.Birkenstack

    Brand felt.

    Hardy & sons

    ACEE auto

    Ahuja .

    Ahuja

    Ahuja

    British felt .

    S.A FELT . Closeal .

    Custom Seal.

    Ahuja .

    Ahuja

    Aypa talstil

    ITALY

    HOLLAND.

    GERMANY.

    CANADA.

    ENGLAND

    AUSTRIALIA

    AUSTRIALIA

    SINGAPUR

    MALASIA

    U.K

    SOUTH AFRIACA SOUTH AFRICA

    SOUTH AFRICA

    NEWZELAND

    POLAND

    TURKEY.

    DOMESTIC CLIENT

    Customer Client

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    B.R.wool agency .

    Modern wollen.

    Sarvesh wool tax .

    Kamal Industries .

    Marutex wool

    Industres.

    LUDHIYANA

    BHILWARA

    .LUDHIYANA

    .BIJAYNAGAR

    LUDHIYANA

    PRODUCT PROFILE

    Although wool felt is the Worlds oldest textile structure and it has

    been pract ically in every industry, generations of engineers and

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    materials science/specifiers are growing up without knowing much

    about much about this remarkable material.

    Over 130 years of continuous industrial development has demonstrated

    the versatility of wool pressed felt as a material that has far surpassed

    any other textile material in the depth and breadth of its applications.

    FELTS is a textile structure composed entirely of fibers physically

    interlocked and consolidated by the uti l ization of mechanical work,

    chemical action and moisture without the use of weaving, knitt ing,

    stitching, thermal bonding or adhesives. it composed wholly of anyone or a combination of new or recycled wool fibers. Part wool felts,

    is a felt composed of any one or combination of new recycled wool

    fibers mixed with one or more man- made fibers, vegetable fibers, etc.

    FELT SPECIFICATION NUMBERS :

    Felts are governed, in India, by Speen. IS 1719.In the Internationalmarket , these are governed by SAE specificat ion F-1 to F-55,DIN

    specification , No.61200,Fedral speen.CF 206 , British Speen, No.BS-

    4060 and U.S.S.R. Speen.No.Gost 6308-71.

    Different forms of wool felts:

    A. Felts sleeve Roller Covering

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    B .Felt Flap Wheels and discs

    C. Wool felt polishing Wheels and Discs

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    D. Felt and Non-Woven rolls :

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    E. Industrial felts component :

    F.Woolen felt Plating Sheet :

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    Pressed Wool Felt Stocking Grid

    Stock = In Stock

    S/O = Special Order

    Product 1/16" 3/32" 1/8" 3/16" 1/4" 3/8" 1/2" 5/8" 3/4" 1"

    More

    than

    1"

    F-1 - - stock stock Stock stock Stock stock s tock s tock S/O

    F-2 - - S/O S/O S/O S/O S/O S/O S/O S/O S/O

    F-3 - - stock stock Stock stock Stock stock s tock s tock S/O

    F-5 - - stock stock Stock stock Stock stock s tock s tock S/OF-7 - - stock stock Stock stock Stock stock s tock s tock S/O

    F-10 - - stock stock Stock s tock Stock stock stock stock S/O

    F-11 - - stock stock Stock s tock Stock stock stock stock S/O

    F-13 - - stock stock Stock s tock Stock stock stock stock S/O

    F-50 stock stock - - - - - - - - -

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    F-51 stock stock - - - - - - - - -

    F-55 stock stock - - - - - - - - -

    Special Orders normally r equire a 3-4 week lead time and a

    manufacturing minimum. Items designated as in-stock are normally

    inventoried, but may occasionally be in the process of being produced,

    thus requiring a 3-4 week lea

    BASIC FUNCTION OF WOOL FELTS AND SOME

    CURRENT APPPLICTIONS:-

    POLISHING AND

    DE-BURRING

    F in is hi ng opt ical and oph thal mi c l enses;

    pol ishing plate glass plast ics , felt hats ,etc;

    buffing wheels for sho e machinery.

    Storing, Wicking,

    Syphoning, Transfer ring

    liquids, Lubricating

    F el t- ni b mar ki ng pens and i nk r es er vo ir s,

    S tamp pads, J ournal l ub ri ca ti ng wicks f or

    a rmat ur e s ha ft s, s pi nd les and many o ther

    inaccessible mashie part ,Wicking material for

    copying machines, Cosmetics Transfer rollers ,

    Wiping devices.

    Spacing-Washers Gaskets,

    packing.

    Gaskets for auto , arc and flood l ight . Gaskets

    in home clothes dryers, ref rigerators , Glass

    covered electr ic meters . Gland packing for

    fue l and supply pumps . Washer in nuclear

    reactor equipment.

    Sealing Rotating/ oburating bands for gun launched

    projecti les , plain and laminated felt seals to

    p ro tect bal l and r ol le r bea ri ngs. Wea ther

    stripping.

    S ur fa ci ng , Pa dd in g a nd

    Cushioning

    Covers for bases of lamps , fan and t rays , etc

    Car d t ab le cover s. L in ing and i n s ol es f or

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    METHODOLOY

    Methodology means the source through which the data is collected

    and which is necessary or important for the study. There are two

    sources of this study :

    Main source

    Secondary source

    1. Main source :

    In primary source, data was collected through interviewing the

    export executive and the marketing person. Also I had collected

    the information from the other staff.

    2. Secondary Source :

    Da ta tha t i s a lready publ ished in va rious pub li ca tion or

    information already available is col lected and combined and

    presented earlier by researches is secondary source.

    a) Import and export policy

    b) Export procedure handbook

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    c) International marketing.

    Secondary data i s extensive ly and intensive ly used for present

    research work. The discussions with various officials in the company

    have helped to understand the basic concepts and procedure.

    TO UNDERSTAND THE DIFFERENT DEPARTMENT

    IN FILTERCO

    DIFFERENT DEPARTMENT IN FILTERCO

    Company mainly deals in two segment of the felts supply chain i .e.

    one is manufacturing of fel ts and other is manufacturing of non

    woven felt . These two segment are different processes but are very

    much l inked in the supply cha in . The company has di fferen t

    depar tment each having speci fied funct ion and responsib il it ies.

    Description of each department will follow in respect to how they

    occur in supply chain.

    Cotton department

    Cotton is one of the most important raw material for the wool felts

    manufacturing. Company purchase the cotton from different industry

    and from some other countries such as WEST AFFARICA and US.

    Cotton department is responsible for placing order of cotton to the

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    mills. Their responsibility is to make sure cotton is order from right

    supplier ,delivered in right t ime with desired quality and maintain

    stock l is ting of cot ton. Cotton department is a lso responsible for

    checking the quali ty i .e s trength, colour, and quant i ty of cot ton

    department. The decision regarding the cotton quality, quali ty and

    strength is decided by the by PPC i.e. production, planning and control

    department.ppc place order one month in advance.

    Opener department

    Opener department is responsible for producing dust free cotton from

    raw cotton. In these the opener machine is used so that cotton can get

    the proper and perfect density and also the opener is responsible for

    bunch free cotton of easy smoothing in the different processes. Felting

    was originally based upon the physical characterist ic of crimp and

    scaly surface that cause them to cling and intermesh and allowed them

    to be pressed into a compact fabric. the felt is made with or without

    admixture of another animal fiber, vegetable fiber, or manmade fiber.

    opener department receive order from PPC stating order or s tyle

    number and quantity of the cotton required.

    Carding department

    Carding depar tment has the same responsib il ity as the opener

    department has. but in these there is machine called cardner. where

    the cot ton goes under the carding machine so that i t get free from

    bunch of bundle. and there is also the Roll carding machine which

    help in making sheet from the wool as per prescribed by the PPC. i t

    has been supposed that 5 kg of woolen is of 1mm .

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    Washing and dyeing department

    The depar tment i s responsib le for two d if ferent s tages in wool

    manufacturing. For grey(not colored)felts, department is responsible

    for the coloration of wool and for dyed (colored) felts, department is

    responsible for washing. the process of dyeing is t ime consuming.

    The department making the production plan for dyeing and w ashing

    machine based on the order from the PPC

    Hardener department

    Hardener department is responsible for giving the proper hardness and

    the density. In this the wool sheets goes under the hardener where it

    get s team from the boi ler so as to get hard this is done as per the

    prescribed by the PPC the hardness can be change according to the

    demand. there is a lso machine cal led MILLING machine is used

    where the sulfuric acid and dazzle powder is mixed so that i t get

    proper hardness and density .

    Cutting department

    The department is responsible for the for cutt ing of sheets into the

    different shape and rolls. This department is mainly responsible for

    cutt ing and avoiding waste. To ensure the minimum wastage,skil ls

    employees are their .the cutting is done according to the density given

    by the PPC.

    Finishing and packaging department

    This is the final stage before the wool felts is ready to shipped. As the

    wool felts are already finished, it requires the series of quality check.

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    The felts goes for check like density test ,hardness test ,washing test

    etc . after which i t is s team pressed , labeled ,packed put into the

    cartoon. Once all the cartoon are packed and labeled , external quality

    placed check takes place and goods are shipped.

    Production, Planning and control department

    The department i s responsible for mak ing plan for the ent ir e

    organizat ion i .e . a ll the depar tment.PPC is the cen tre of a ll the

    department also control functionally. The PPC send production plan todifferent department on weekly basis and daily for any amendments.

    The PPC keeps check on different departments by requesting planning

    and production report for every day.PPC only receives order from the

    top management. with order quantity and dispatch date. i t does the

    planning for the product cycle. The top management is continues

    contact with PPC

    The PPC link with other department

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    Merchandising department

    The department act as a liaisons between the buyer and manufacturing

    division . on one hand, the department is responsible for the notifyingin the product to the PPC and also to make sure that the art ic le is

    produced as per planning by the PPC and within dispatch time limit.

    On the other hand it has to continually update buyer with planning

    and product ion s ta tus. The depar tment i s a lso to take care of a ll

    corresponds with buyer and is responsible for comminuting it to PPC.

    the department is also responsible for the necessary sampling such as

    proto, size set and final which is necessary prior to production .

    Merchandising

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    The companys market ing team endeavor to enhance i ts share of

    business with existing customer as well as the customer base. The

    company receives order from customer by

    Growth in business for existing customer

    New customer developed through cold calls, trade fare meeting

    Walk in-customer

    The companys marketing team has been able to diverse different strategies to suit

    the need both existing and new buyer. For the existing buyer, the company prime

    project is to expand the product base and enhance volume .By leveraging the long

    standing relationship with the buyer, the company strives to preferred partner to

    the buyer. For the new buyer, based on understanding of their product range and

    brand identity/ customer identity, the company present to them to their entire

    project range. This give them good idea of areas of the companys expertise and

    capability. Sometimes the buyer comes to FILTERCO with their thought on

    different size and density, where they offer their suggestion on modification. In

    case where they come to FILTERCO with predetermined size requirement, they

    also try to add value for suggesting modification to enhance functionality or to

    reduce cost while retaining the existing size. FILTERCOs skilled worker gives the

    desired size and density along with the sampling department provide the client

    with prototypes, which undergoes various alteration till the client finalize the size.

    Once the size and density is finalized it is translated into sample size as quickly as

    possible because the entire seasons business depend on timely delivery of sample.

    The costing exercise is done concurrently at this stage. FILTERCOs

    manufacturing scale and efficiency and global sourcing ability enables

    .FILTERCOs to compete with international vendors effectively. This is proven by

    the growth of the Company in non-quota categories, where competition has already

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    invoice is prepared for the buyer & Custom invoice is prepared

    for the Custom authorities of both the countries .

    Packing list is prepared which details the goods being shipped.

    GSP certificate is prepared if the consignment is exported to EU

    or countries mentioned in the GSP list.

    Buying house inspects the goods & issues an inspection

    certificate.

    Certificate of origin is also issued and attached, if required.

    Following documents are given to Customs for their reference:

    Custom Invoice

    Packing list

    IEC certificate

    Purchase Order or L/C, if required.

    Custom annexure

    On receipt of above documents, customs will issue clearance

    certificate.

    After custom clearance a set of documents with custom clearance

    receipt are sent along with the consignment to the forwarder.

    Forwarder books the shipment & as per the size of the cartons

    calculates CBM & decides which container to be used.

    Following documents ar e sent to buying house for their

    reference, as per buyers requirement:

    Invoice

    Packing List

    GSP (if exports to Europe)

    Certificate of Origin (if required)

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    A copy of FCR/ Airway Bill/ Bill of Lading

    Buying house then intimates the buyer about the shipment & gives the

    details regarding it. Buying house will send a set of these documents

    to the buyer.

    Buyer col lects the consignment from the destination port by

    showing the following documents:

    Invoice

    Packing List

    Bill of lading/ FCR/ Airway Bill

    On shipment of goods, exporter will send the documents to the importers

    bank

    Post-Shipment Procedure

    A foreign buyer will make the payment in two ways:

    TT ( telegraphic transfer) i.e. Wire Transfer (Advance

    payment, as per the clause 50% advance & remaining 50% on

    shipment)

    Letter of Credit

    If the payment terms are a conf irmed L/C then the payment will

    be made by the foreign bank on receiving the following

    documents:

    Invoice

    Packing list

    B/L

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    Any other required by the buyer or the country of import.

    The payment terms can be:

    o At Sight

    o Within 15 days from Bill of Lading or Airway Bill date.

    o Within 30 days from Bill of Lading or Airway Bill date.

    o Within 60 days from Bill of Lading or Airway Bill date.

    o Within 90 days from Bill of Lading or Airway Bill date.

    After shipment , exporter sends the documents to the buyers

    bank for payment. As the buyers bank receive the documents it

    wil l conf irm with the buyer for release of payment. On

    confirmation, it will make the payment in the foreign currency.

    The transaction will be Bank to Bank.

    The domestic branch wil l c redi t the expor ters account , as

    against the respective purchase order or invoice, in Indian rupees

    by converting the foreign currency as per the cur rent bank rate.

    If the payment is through wire t ransfer , the payment wil l be

    made as per the terms agreed by the exporter (Advance payment,

    as per the clause 50% advance & remaining 50% on shipment).

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    Registration procedure of FILTERCO

    Export procedure contains standard step for the business. It can be

    done through direct or indirect way. Before starting Export of any

    product, one has to get registered itself under IEC & RCMC.

    A. Registration under Importer-Exporter Code ( IEC):

    Regis trat ion under Importer-Exporter code number i s bas ic

    necessi ty for the export business. The registered office of the

    applicant sha le make am applica tion for grant of IEC to the

    l icensing authority. Thus fol lowing documents should support

    dully signed application:

    Bank receipt (in duplication)/DD of Rs.10000/-

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    Income tax PAN NO.

    Photocopy of RBIs approval of Non-Residents interest

    if any in the form of company.

    The licensing Authority concerned shall issue an IEC number. A copy

    of such IEC number shall be endor sed to the concerned banker. An

    IEC no. allotted to an applicant shall be valid for all it s

    branches/division/units/factories as indicat ed in the format of IEC

    Registration with Export Promotion Council

    (RCMC):

    To obtain benefi ts under the export-import pol icy, companies are

    required to register with an appropriate promotion agency by obtaining

    registration cum membership certificate i.e. RCMC.

    EXPORT DOCUMENTATION AT FILTERCO.

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    List of documents, which are used at FILTERCO pvt.ltd are as

    under:

    Invoice

    Packing Slip

    Airway Bill or Bill of Lading

    Shipping Bill

    Certificate of origin

    Bill of Exchange

    Generalized System of Preference

    Canada Custom Invoice

    Letter Of credit

    Bank certificate of Export and Realization (BRC)

    Insurance

    Following are the detailed elaboration of the above listed exportdocuments:

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    INVOICE:

    I t i s the document, which i s compulsor ily needed in the expor t

    documentation. It consists of buyer name, notified address, country of

    the f inal des tina tion and origin of goods , term of del ivery and

    payment, place of delivery, port of loading and discharge. It consists

    of the items; quantity and description, which have to be exported with

    the total, amount in foreign currency or may be any other currency. At

    FILTERCO the company used Dollar as the currency for invoicing.

    This is the proof of the sale of goods to the buyer. The invoice number

    is required in each and every document. It is also used to customs for

    the clearance of the goods.

    The copy of invoice from FILTE RCO is attached in the annexure no.1.

    PACKING SLIP:

    The pre shipment department prepare packing list. The list is sent to

    buyer along with the goods. The packing list contain the details or the

    description of the item in each carton. It consist the Invoice Number,

    Letter Of Credit no.,total Quality, Total Carton, Carton Dimensions,

    Net weight and Gross Weight. The list help the importer to know and

    ident ify the i tem without opening and count ing the goods in the

    carton and he can also sell the carton to the buyer without opening the

    carton, because the style, color, sizes are mentioned in the particular

    carton. Thus packing lit contain all the details of the yarn containing

    in the carton.

    The copy of packing list from Filterco is attached n the Annexure

    no.2

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    BILL OF LADING OR AIRWAY BILL:

    Bill of lading is the receipt given by the transporting company to the

    exporting fi rm. This document state that the payment is made by

    exporting company and the good has been received in their hand for

    forwarding the goods to the destination.

    Airway bill is followed only in the case of transportation by the air,

    whereas Bill of Lading is used in the case of sea transportation. Bill of

    Lading and Airway Bill is Negotiable Instrument.

    The Bil l of Lading or Airway Bil l contains the name of exporter ,

    Importer, Loading Vessel, Port of Loading, and Port of Destination. It

    also include the marks and nos. on the carton, description of goods,

    LC no., Gross and net weight.

    FILTERCO almost 90% transportation was through ship while the

    sample is send through Airway. The Bill of Lading is send as per the

    letter of credit terms.

    The copy of Bill of Lading of FILTERCO is attached in Annexure 3

    CERTIFICATE OF ORIGIN:

    Certificate of Origin is the document in which the authority certifies

    that the goods as described as originated in the country in accordance

    with the provision in force in the European Economic Community.

    This cert if icate is a s ta tutory proof that the goods produce or the

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    material used or the exporter or the seller of the good is of a particular

    state.

    At FILTERCO is located in Neemuch the certificate is issued by the

    MUMBAI chamber of Commerce and Industry.

    The copy of the Certificate Of Origin used FILTERCO is attached in

    Annexure 4.

    SHIPPING BILL:

    Shipping Bill is the document of clear ance from the cust om

    department. This Document helps in gett ing the green signal to the

    forwarders to go ahead with the goods towards i ts final destination.

    This document consist details as under

    i . Exporters Name and Address

    i i. Consignee

    i ii . Por t of Loading

    iv. Por t of Discharge

    v. Duty Entit lement Pas Book (DEPB) Specification

    vi. Duty Drawback Specification

    vii . Invoice No. and value

    vii i. I tem Descript ion

    ix. Vesse l Name

    Some port in India follows manual procedure of issuing Shipping Bill

    while some of the port follows EDI System. The Electronic Data Input

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    system (EDI) is located only in some important port . Chennai port

    fol lows the EDI system while the Tutocorin port fol lows Manual

    method System.

    D. GENERALISED SYSTEM OF PREFERENCE (GSP)GSP is issued by

    the Export Inspection Agency. The document is issued as per the import

    needs. This document is for the developing countries like India while

    exporting goods to the developed countries. The countries that require the

    GSP document are as under.

    Australia

    Canada

    Japan

    New Zealand

    Switzerland

    USA

    Republic of Belarus

    Republic of Bulgaria

    Czech Republic

    Russian Federation

    Denmark

    Germany

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    Greece

    Spain

    France

    Ireland

    Italy

    Luxembourg

    Finland

    Sweden

    Luxembourg

    Finland

    Netherlands

    United kingdom

    GSP is issued in case of exporting the goals to the above mentioned

    developed countries. Due to this certificate the importers country

    give some benefit to the importer like low import duty and many other

    benefits. Thus the incurring cost for procurement becomes low which

    col lect ively wil l be beneficial for the importer to import from the

    developing countries l ike India. Hence more imports will be taken

    from India . thus India will enjoy the increasing number of export of

    the goods.

    There are some general condition to qualify for preference, product

    must

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    A. Fall within a description of product eligible for preference in the

    country of destination. The destination entered on the form must

    be sufficiently detailed to enable the product to be identified by

    the customer officer examining them.

    B. Comply with the rules of origin of country of destination. Each

    article in a consignment must qualify separately in its own right

    and

    C. Comply with the consignment condition specified by the country

    destination.

    Procedure for claiming the GSP

    A declaration on the certificate of origin from must be prepared in

    duplicate together with the GSP application from to the certifying

    authority of the exporting country .The authority after inspection if

    satisfied then certify the top copy of the Certificates of origin and

    return the top copy to the exporter for the communication with the

    importer destination .At the same time the certifying authority returns

    the duplicate copy of certificates authority returns the duplicate copy

    of the certificate of origin but will retain the GSP application from

    duly completed and signed by the exporter.

    The copy of the GSP of FILTERCO is attached in annexure

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    Canada customer invoice :

    The Canada customer invoice is prepared when the goods are to

    be export the goods to Canada . This invoice i s used as the

    customer off ice of Canada requi res the invoice . The Canada

    customers require the declaration of the goods in their specified

    format. The customer in Canada have their own specified invoice

    format.

    LETTER OF CREDIT :

    Letter of credit is the pre-shipment document. This document states

    that payment will be made to the exporter by the importers bank if

    the required document are presented to the bank within the validity

    of the letter of credit. Following is the working of the importer and

    exporter regarding the letter of credit.

    The exporter requests the importer to issues of credit in hisfavor.

    The importer request his bank to open a letter of credit

    The importer bank open letter of cr edit and forwards to the

    exporters bank

    The exporters take the possession of the letter of credit

    The exporter supplies the goods and present the full set of

    documents along with the draft to the negotiating bank.

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    The negotiating bank then scrutinizes the document and if

    they are in order makes the payment to the exporter.

    The issuing bank will reimburse the payme nt to the

    negotiating bankThe letter of credit is annexed in

    which is used in FILTERCO

    Bank certificate of export and realization:

    This is the last document, which s involved in the export

    documenta tion procedure . The bank i ssues the document. This

    document completes all the procedure of export i .e from the order

    received to goods dispatched. the bank issues this certificates when

    all the formalities have been completed from the exports side . When

    the importer inspect that all the legali ties and the good have been

    arrived as per their agreement then importer or buyer orders his bank

    to realize the cash to the exporters bank .after receiving the exchange

    the bank issue this certificate (BRC). BRC includes the specification

    Date and number of invoice

    Date and number of shipping bill

    Country of destination

    Bill amount

    Freight amount as per bill of lading or air bill

    Date of realization of export

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    This certificates includes all the necessary of every necessary export

    document.

    The bank keep the records of all necessary transactions the company

    has maintain against the letter of credit. This certificate also helps the

    bank to allow the foreign exchange the company has earned. Thus

    BRC cer ti fy tha t the bank have the relevant has earned. Export

    document and found to be correct.

    Bill of exchange

    These are unconditional promises drawn by the exporter instructing

    the buyer to pay the efface amount of the drafts bank in both the endact as an intermediary in this processing of shipping document and

    collection of payment. in banking terminology the transaction is called

    as documentary transaction . The bill of exchange used.

    INSURANCE:

    To overcome risk we need to insure the good .at the filter co there is the system of

    taking the bulk insurance of some amount then as and when there is shipment with

    the CIF terms then the insurance policy is taken with the notification to the

    insurance company.

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    Different ways of consignment methods used in Export Trade in

    FILTERCO:

    In order to deliver goods to the clients, traders and suppliers have to

    choose among a variety of consignment methods. They generally

    evaluate a few aspects before deciding upon the shipping mode.

    These aspects are:

    i. Whats the Business size

    ii. Cost Factor.

    iii. Product safety Concern

    iv. Product deliverance timev. Products to be delivered

    Mode of consignment can be evaluated by following intrinsic

    characteristics.

    i. Quick delivery

    ii. Price Comparison

    iii. Product protection

    iv. Convenience to client and trader

    Different ways have different advantages and l imitations. Few are

    safer, some actually quick and others have an advantage of being low

    cost. You can decide any of the ways discussed below which suits you

    necessities.

    Air transportation:

    This way is quickest and much safer mode of transportation. Despite

    of being secure and rapid, suppliers (especially the small ones) are

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    often unwil ling to use this method, most ly because of high price

    associated with it. This should be supportive when transporting some

    high-value products or when a rap id del ivery i s requi red due to

    seasonal factors or goods of perishable nature. In FILTERCO mainly

    used air transportation for the samples delivery.

    Sea transportation:

    Most probably the o ldes t way used in expor t im port for foreign

    suppl ies. In olden days t raders voyaged by means of sea, carrying

    numerous products and items to trade in overseas nations. Economical but fai r ly slow, certainly not a f ine choice when fast del ivery is

    desired. However, when the time is not a concern and consignment is

    fair ly big or bulky, naval t ransport becomes a usual a l ternative.

    Mostly all consignment in FILTERCO is done by the sea

    transportation.

    Road transportation:

    This is the widely used mode, particularly in local trade. Even when

    water o r a ir t ransport i s the main sou rce of cons ignmen t, road

    transportat ion is s ti l l desirable to carry the i tems from harbors to

    consumer. Although restricted to local trade, this way is both t ime

    saving and economical and fac il itates door to door del ivery by

    connecting to the sea and airport. FILTERCO used this transportation

    for local trade generally.

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    OBSERVATION

    After studying the companies export procedure and documentation

    following observation are made.

    1. The procedure of exports and imports is very time consuming since

    at all levels govt. and semi govt. agencies are involved. At every stage

    loss of time is there which is a great hindrance in the foreign trade.

    2 . Paper work i s very much. There a re many s tep involved in fore ign

    trade procedure. At every step, paper work has to be done in both

    exports and imports, which in turn increase the transaction cost. Thats y

    now All documentation is done by software, which lead to quick work.

    3. Much time spend on shipment of goods and custom clearance.

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    4. Firm has to pay losses while rece iv ing cash due to f luc tuat ion in

    foreign exchange prices.

    5. The client countries also include the countries where lots of

    documentation is required.

    FINDINGS

    1. Friendly atmosphere

    2. Ded icat ion, teamwork and coordina tion

    3 . Fol lows an au tocrat ic cum democra tic style of management

    4. All higher posi tions of the company are f i lled up within the

    members of the Filterco family

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    RECOMMENDATIONS/SUGGESTION

    There should be some harmony between the directors and the

    employees. While undergoing the study various flaws regardingdocumentation process , loading point, dispatch area and transportation

    was observed. During this period of our study various pit falls and

    problems in existing system we found so to provide FILTERCO a better

    future various options has been chalked out.

    The company should try to advertise its activities through

    Internet and direct mails to its target customers.

    Prices should be made competitive to match the export

    standard, which may be done through Economic of scale in this

    globalization era.

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    In order to be successful in export one must fully

    research in market. No one should ever try to tackle

    every market at once. Many enthusiastic persons bitten

    by the exports bug fail because they bite off more than

    they can chew. The fewer intermediaries one has the

    better, because intermediary.

    Deliveries must be done on time.

    Customers and good must be provided with after sales services, it

    will help customers and goods to survive more and better

    Communication whether internal or external must be far-reaching

    and speedy Good communication is vital in export.

    Risk of failure in export marked can be minimizing by intell igent

    use of research.

    As per our analysis loading cycle time can be reduced by on-line

    system entry. As the truck reports the truck no., transporter name

    etc. must be entered into the system by the security officer. The

    information provided is uploaded by sales dept. The sales dept.then makes the loading advice memo entry in system accordingly

    and the dispatch dept. generates this loading memo and starts

    further process.

    There should be a foolproof system of controlling, approving the

    placement of vehicles by logistics section to work under a

    committee comprising of 2/3 persons with empowerment to take

    decision.

    Painting & Printing of the reels should be done well in advance

    before the placement of lorry. Also materials should be traced well

    in advance.

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    There should be a change in layout of loading cycle which creates

    some problem for heavy vehicle to weight. This arrangement

    should be made easy and straight so that the process involved take

    less time. For example the weigh bridge should be placed near gate

    no. 3 which surely reduces the time in this period i.e. loading cycleperiod.

    There should be some substitute for the weigh bridge in-change in

    case if he goes for lunch & other miscellaneous activities

    CONCLUSION

    After understanding the ground realities of foreign/international trade it is

    crystal clear that services are major factor should be kept in mind at any

    moment of time. Transparency in work, proper communication, systematic

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    preparations of documents, punctuality are some of the major process for a

    department which deals with import/export process of a company.

    Accuracy in documents is very important. Exporters are required copy of

    invoice and packing list. A standard of this document is always preferred as

    it helps to understand the information in a correct and broader manner and

    which ultimately saves time in the process.

    BIBLOGRAPHY

    www.ieport.com

    www.indiamart.com

    Ministry of textile

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    Export procedure.

    Books

    A) The Management Of Business Logistics----COYLE-----BARDI

    -----LANGLEY

    B) Export Import Procedures And Documentation.

    ----Dr. Khuspat, S.Jain (Himalaya Publication)

    ---M. L. Mahajan.

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