INDUSTRIAL PROFILEIndia is a diverse country where different states have different consumption patterns and customs. Competition has become the key word in todays scenario. Till 1970 s and 80s Maggie and Kissan were the major ketchup brands but after liberalization Heinz entered Indian market which offered tough competition. These major giants are also facing competition from many local players like Tops, Cremica and other local brands. The ketchup market in India is estimated to be around Rs 220 crore, largely dominated by Nestles Maggi that owns 47% of the market and the Kissan that owns 26%. Up to mid eighties Kissan was the number one brand in Tomato Ketchup and around that time the competition came from Maggi -- a Nestles brand Maggi launching several varieties of Tomato Ketchup there was a growth in the market. With Kissan and Maggi fighting neck to neck other smaller but established brands like Dipy's from Herbert sons, Volfruit from Voltas, Noga of Nagpur Orange Federation and SunSip of Wimco gradually disappeared from the market. Delmonte now has joined hands with Paoma Industries, the manufacturers of Rasna Brands of soft drink concentrate and is expected to launch Tomato Ketchup shortly. At a time when Kissan had become generic to tomato sauce, Maggi came in with its sauces range. Maggi was the upstate new corner who came in with a loud aggressive national burst. It did not come in with one, but with a range of sauces in order to increase market share and expand the market by offering more usage occasions, bring consumers with different needs into the Maggi Sauces fold and weaning away users of different brands to Maggi. From a market share of 14% in 1985, Maggi Sauces now enjoys a share of about 50% of the market.
COMPANY PROFILE Name :Lucky Canning co.
Address :204, Mahalaxmi Industrial Estate,Dr. Hedgware Road, Bamroli Road, Surat-395 002. Gujarat
Customer care no. : 0261-2634384
This company was established in 1948. This company is run by three partners namely as:
1) Firoz hasanwala 2) Zoyeb patangwala 3) Sefudin
This three are the current business partners and owners of the company. All the partners are engineers and they only handle all the structure of the business .the business running is only over Gujarat. They do not sell their products outside Gujarat. The raw material required for the manufacturing products is purchased from the local area only. There are only 15 20 employees in each site. Whatever the company runs on a small scale but they do it in a much disciplined way. 8- Hours shift of every employees. They prefer only single shift. They get the employees which know the culture, life styles about the area what are their requirements are they adjustable or not. They prefer sons of soil.
1. INTRODUCTION OF FINANCE DEPARTMENT
A. DEFINITION OF FINANCEFinance is that administrative area or set of administration function in an organization which relates the arrangement of cash and credit so that organization may have the means to carry out its objective as satisfactory as possible
Blood is important part of human beings. And money is blood for sound business. Money is the life-blood at modern business. Money is required to purchase expensive machinery, and day-to-day expenses on raw materials, labor, and operational and administrative needs at business, execution at expansion.
B. IMPORTANCE OF FINANCEI. To meet contingencies:-
Funds are always required to meet the ups and downs of business and unforeseen problems. Suppose, some manufacturer anticipates Shortage of raw materials after a period. Obviously he would like to stock raw materials. But he will be able to do so only when money would be available.
To promote sales:-
In this era of competition, lot of money is required to be spent on activities for promoting sales like advertisement, personal selling, home delivery of goods etc.
To avail of business opportunities:-
Funds are also required to avail of business opportunities. Suppose a company wants to submit a tender but some minimum amount is enquired to be deposited along with the application. In the case of non-availability of funds it would not be possible for the company to apply.
C. FUNCTION OF FINANCEThere are 4 function of finance.
i) INVESTMENT DECISION ii) FINANCING DECISION iii) DIVIDEND DECISION iv) LIQUIDITY DECISION
There is broad agreement that the correct cut-off rate or the required rate return on investment is the opportunity cost capital. The opportunity cost capital is the excepted rate of return that an investor could earn by investing his or her money in financial assets of equivalent risk. However, there are problem in computing the opportunity cost of capital in practice from the available data and information. A decision maker should be aware these problems.
Finance decision is the second important function to be performed by the financial manager. Broadly, he or she must decide when from and how to acquire funds to meet the firms investment needs. The mix of debt and equity is known as the firms capital structure. The financial manager must strive to obtain the best financing mix or the optimum capital structure for his or her firm. The firms capital structure is considered optimum when the market value of shares is maximized.
Dividend decision is the third major financial decision. The financial manager must decide whether the firm should distribute all profits, or retain them, or distribute a portion and retain the balance. The proportion of profits distribute as dividend as called the dividend- payment ratio and retain portion of profits is known as the retention ratio. 4
Investment in current assets the firms profitability and liquidity. Current assets management that affects a firms liquidity is yet another important finance function. Current assets are managed efficiently for safeguarding the firm against the risk of illiquidity. Lack of liquidity in extreme situations can lead to the firms insolvency.
The profitability-liquidity trade-off requires that financial manager should techniques of managing current assets. He or she should estimate firms needs for current assets and make sure that funds would be made available when needed.
2. CAPITAL STRUCTURE OF COMPANY There are two types of sources of working capital, like Long term And Short term fund, which show here:
Types of sources of working capital
SOURCES OF FUNDS
SHORT TERM FUND
1) Long term Fund a. Issue of share b. Loan c. Debenture f. Commercial Paper
2) Short term Fund:
1. Internal 1. Depreciation 2. Taxation Provision 3. Accrued Expenses
2. External 1. Trade credit 2. Credit paper 3. Raw material 4. Debaters 5. Security of Employees 6. Loans from Directors
As we early seen that LUCKY SAUCE Company is financially strong so it can easily get both types of funds.
The LUCKY SAUCE Company also uses this source of WC for their production. The company use these sources to gain fund, which is following hear.
Debtors Raw material 6
1. Debtors: The company uses these sours of the working capital. The company gets long fund for its customer. The company sells its product to customer for one month credit.
2. Raw material: The company sells its raw material, which is not use in the fabrics and get lot of fund for its Working capital.
A. Working Capital Management AnalysisAny type of business enterprise needs two types of capital fixed capital and working capital, capital investment in fixed assets like, land, plant, capital and a part pf the total capital investment in current assets like stock, debtors, bills receivables, cash and bank is known as working capital. In order to keep the working capital is essential. It is the working capital that keeps the wheel of the business running. That is why it is said that working capital is the life blood of the business running adequate working capital is essential. However, working capital more than or less than required proves to be harmful. Therefore to keep the total working capital and its component parts at satisfactory level its proper management is of much importance.
MANAGEMENT OF CASH
Cash is the important current assets for the operations of the business. Cash is the basic input needed to keep the business running on a continuous basis, it is also the ultimate output expected to be realized by selling the service or product manufactured by the firm. The firm should keep sufficient cash, neither more nor less. Cash shortage will disrupt the firms manufacturing operations while excessive cash will simply remain idle, without contributing anything towards the firms profitability. Thus, a major function of the financial manager is to maintain a sound cash position
For many business firms Inventory is one of the visible and tangible of doing business. Raw materials, work in process and finished goods all represent various form of inventory. In simple words, inventory refers to stocks of good necessary to do business.
Another component of working capital is inventory. The factory is very big kitchen which requires hundreds or thousands of items for manufacturing different products. Such items include the stock of raw materials, goods in process, finished goods and other consumable stores. The management of inventory is important because a substantial part of working capital remains invested in inventory and different types of costs are associated with it. Situations like under stocking, overstocking, purchasing in small quantities or large quantities etc. always prove to be very costly. From the view point of scientific storage of different items also inventory management is important.
Types of inventory Inventories can be classified into three categories: (1) Raw Materials: These are the goods which have not been so far committed to production in a manufacturing business firm. They include unprocessed basic raw materials, finished components or spare parts or intermediate goods to be used as raw materials. (2) Working in process: This refers to those materials which have been committed to processes but not yet been completed. (3) Finished goods: These are processed and completed products a waiting for sale. They are the final product or output of the production process in a manufacturing firm. They are merchandise inventory for wholesalers and retailers.
In the with LUCKY SAUCE Company, the Production manager & Finance manger both are take decision about inventory separately.
3. RATIO ANALYSIS 1. Gross profit ratio :-
This ratio establishes the relationship between gross profit on sales and net sales i terms of percentage indicating the percentage of gross profit earned on sales. Gross Profit Gross Profit Ratio = ------------------- 100 Net Sales Years Gross profit (a) 07-08 08-09 09-10 10-11 11-12 3908.31 3451.06 4481.98 6948.76 8376.6. Net sales (b) 46044.16 40347.01 44459.79 45167.17 52431.08 [Rs in lacks] Ratio (%) (a/b) 8.49 8.55 10.08 15.38 15.98 (%) of changes 0.70 % 17.89 % 52.57 % 3.90 %
(%) of changes60 50 40 30 20 10 0 52.57
17.89 0 2007-2008 0.7 2008-2009 2009-2010 (%) of changes 2010-2011 3.9 2011-2012
Interpretation :The gross profit of the company is incresing day by day. It is increase to 15.98 % in 2011-12 as comapre to 2010-11 i.e 15.38 %. 9
Net profit ratio :-
This ratio establishes the relationship between the amount of net profit or net income and the amount of sales revenue.
Net Profit Net Profit Ratio = ------------------- 100
Net profit (a)
Net sales (b) 46044.16 40347.01 44459.79 45167.17 52431.08 [Rs in lacks]
Ratio (%) (a/b) 1.82 1.47 4.63 6.48 7.36
(%) of changes 19.23 % 214.96 % 39.95 % 13.58 %
07-08 08-09 09-10 10-11 11-12
837.40 593.50 2061.84 2926.51 3858.95
(%) of changes250 200 150 100 50 0 214.96
19.23 2007-2008 2008-2009
(%) of changes
Interpretation : The net profit of the company is incresing day by day. In 2008-09 it was decrease to 1.47% but company take corrective action so that it continuously increase from that time.
Operating ratio :-
This ratio takes into account the aggrerate of manufacturing cost of goods sold and other operating expenses on the one hand, and the net sales revenue on the other.
cost of good sold + Operating Expenses Operating Ratio = ---------------------------------------------------- 100 sales revenue
COGS +OE (a)
Sales revenue (b) 46044.16 40347.01 44459.79 45167.17 52431.08 [Rs in lacks]
Ratio (%) (a/b) 90.49 83.57 82.43 76.11 91.72
(%) of changes -7.64 % -1.36 % -7.66 % 20.50 %
07-08 08-09 09-10 10-11 11-12
45457.99 40386.36 42945.68 41528.41 48091.61
(%) of changes30 20.5 20 10 0 0 -10 2007-2008 2008-2009 -7.64 -1.36 2009-2010 2010-2011 -7.66 2011-2012
(%) of changes
Interpretation: Sales revenue is increasing in 2011-12, lower operating ratio shows the higher operating profit and vice versa. For manufacturing concerned an operating ratio between 75% & 80% is expected. 11
4 Stock turnover ratio :Inventory turnover ratio which is also called stock turnover ratio or stock velocity establishes the relationship between the cost of goods sold during a given period and the average of the costs of openaing and closing stocks. Cost of goods sold Stock Turnover Ratio = -------------------------average inventory [Rs in lacks] Years Cost of Goods Sold (a) 07-08 08-09 09-10 10-11 11-12 42387.08 37528.80 40525.54 37506.16 43573.96 Avg. Inventory (b) 7186.88 6546.48 5530.16 5653.43 5500.88 Ratio (a/b) 5.90 5.73 7.33 6.63 7.92 (%) of changes -2.88 % 27.92 % -9.54 % 19.45 %
(%) of changes30 20 10 0 0 -10 -20 (%) of change 2007-2008 2008-2009 -2.88 2009-2010 2010-2011 -9.54 2011-2012 27.92
Interpretation: A higher inventory turnover ratio is better than a lower inventory turnover ratio. A higher ratio implies good inventory management and an indication of under investment lower inventory turnover ratio indication of excessive inventory and over investment in invento
3.2 BALANCE SHEET RATIO1. Current ratio :The ability of a company to meet its short-term commitment is normally assessed by comparing current assets with current liabilities. The current ratio establishes the relationship between the current assets and the current liabilities. The ideal ratio is 2:1. Current assets Current Ratio = -------------------------Current liabilities Years Current Assets (a) 07-08 08-09 09-10 10-11 11-12 14916.44 13495.96 10101.54 13759.64 9921.08 Current Liabilities (b) 3630.93 4008.77 3178.01 4093.50 5721.94 [Rs in lacks] Ratio (a/b) 4.11 3.37 3.18 3.37 1.73 (%) of Changes -18 % -5.63 % 5.97 % -48.66 %
(%) of changes20 0 0 2007-2008 -20 -40 -60 (%) of change -48.66 2008-2009 -18 2009-2010 -5.63 2010-2011 2011-2012 5.97
Interpretation : In last five years the current ratio is between 3.18 to 4.11 which was very good for the company. But in the last year it was 3.37 while it was highest in the 2007-08 i.e. 4.11 so compnay should take corrective action for increase the ratio. 13
Liquidity ratio :-
A liquidity ratio is also known as acid-test ratio, therefore, used as a complementary ratio to the current ratio. The ratio is concerned with the establishment of relaionship between the liquid assets and the liquid liabilities. The ideal ratio is 1:1 Liquidity Assets Liquidity Ratio = -----------------------Curent Liabilities Years Liquidity Ratio (a) 07-08 08-09 09-10 10-11 11-12 7455.46 7863.99 4673.20 7881.12 4797.84 Current Liabilities (b) 3630.93 4008.77 3178.01 4093.50 5721.94 [Rs in lacks] Ratio (a/b) 2.05 1.96 1.47 1.93 0.84 (%) of changes -4.39 % -25 % 31.29 % -56.47 %
(%) of changes40 20 0 -20 -40 -60 -80 (%) of changes 0 31.29
Interpretation : Liquidity ratio from 2007-08 to 2010-11 it is satisfied because it is greater than 1:1 but last year i.e. 2011-12 there is 0.84 it was less than satisfactory level. So company should take corrective action for the improve this ratio. 14
3. Debt equity ratio :This ratio is calculated to measure the relative proportion of outsiderss funds invested in the company. This ratio determined to ascertain the soundness of long term financial policies of that company and is also known as external-internal equity ratio.
Long term debt Debt Equity Ratio = ---------------------------Shareholder fund Years Long term debt (a) 07-08 08-09 09-10 10-11 11-12 5238.49 7417.12 8304.24 8846.48 9645.26 Shareholder fund (b) 35284.66 32682.88 34053.66 30482.55 30908.01 [Rs in lacks] Ratio (a/b) 0.15 0.23 0.24 0.29 0.31 (%) of changes 53.33 % 4.34 % 20.83 % 6.89 %
(%) of changes60 50 40 30 20 10 0 53.33
4.34 2009-2010 (%) of changes 2010-2011
Interpretation : In last five years the debt equity ratio is between 0.15 to 0.31 which shows that the claim of creditors are less than that of owners but the claims of creditors is increases in last five years. 15
Propritory ratio :-
This ratio shows the relationship between shareholders fund and total assets. The result clearly shows the share of owners in the total assets of the company. When the proprietary ratio is substracted from one, the resultant figure represents the share of outsiders claim on the assets of the company. shareholder fund Propritory Ratio = -------------------------total assets Years Shareholder fund (a) 07-08 08-09 09-10 10-11 11-12 35284.66 32682.88 34053.66 30482.55 30908.01 Total assets (b) 50676.34 46590.91 46828.82 52184.81 58004.16 [Rs in lacks] Ratio (a/b) 0.70 0.70 0.73 0.58 0.53 (%) of changes 0% 4.28 % -20.54 % -8.62 %
(%) of changes10 5 0 0 2007-2008 0 2008-2009 2009-2010 2010-2011 2011-2012 -8.62 4.28
-5-10 -15 -20 -25
-20.54 (%) of changes
Interpretation : In last five years the propritory ratio is between 0.58 to 0.73. It was almost stable during last four years but in 2011-12 it was 0..53 which shows a greater risk to creditors. 16
5. Capital gearing ratio :The term capital gearing is used to describe the relationship between fixed interest bearing securities, and the equity shareholders funds. Therefore this ratio establishes a meaningful relationship between the funds bearing fixed interest on the one hand, and the equity shareholders funds on the other. Fixed interest bearing fund Capital Gearing Ratio = --------------------------------------equity share capital
Fixed int. Fund (a)
Equity capital (b) 3829.06 3829.06 3829.06 3829.06 3829.06 [Rs in lacks]
Ratio (a/b) 1.37 1.94 2.17 2.31 2.52
(%) of changes 41.60 % 11.85 % 6.45 % 9.09 %
07-08 08-09 09-10 10-11 11-12
5238.49 7417.12 8304.24 8846.48 9645.26
(%) of changes60 40 20 0 0 2007-2008 2008-2009 2009-2010 (%) of changes 2010-2011 2011-2012 11.85 6.45 9.09 41.6
Interpretation : The capital gearing ratio is between 1.37 to 2.52 during last five years. In 2011-12 it was 2.52, the capital gearing is said to be high, this position is under capitalisation.
3.3 INTER-STATEMENT RATIO1 Return on investment ratio :This ratio is an indicator of the earnign capicity of the capital employed in the business. This ratio reflects the overall efficiency with which capital is used. PATI Return on Investment Ratio = -------------------------capital employed Years Profit after tax & interest (a) 07-08 08-09 09-10 10-11 11-12 837.40 593.50 2061.84 2926.51 3858.95 Capital employed (b) 33771.26 31193.36 31445.76 38007.83 41543.08 [Rs in lacks] 2.48 1.90 6.56 7.70 9.29 -23.38 % 245.26 % 17.37 % 20.64 % Ratio (a/b) (%) of changes
(%) of changes300 245.26
200100 0 0 -100 2007-2008 2008-2009 -23.38 2009-2010 (%) of changes 2010-2011 2011-2012
Interpretation : The return on investment is higher in last year i.e 7.70 times which is good sign for the company but it was very low in 2008-09 which is increase in couple of years.
2 Return on propritory fund ratio :This is an important ratio as it shows the amount of profit available to the shareholders which determines the rate of dividend. EAT Return on Propritory Fund Ratio = ------------------------ 100 shareholder fund [Rs in lacks] Years Earnings after tax (a) 07-08 08-09 09-10 10-11 11-12 837.40 593.50 2061.84 2926.51 3858.95 Shareholder fund (b) 35284.66 32682.88 34053.66 30482.55 30908.01 Ratio (a/b)x100 2.37 1.82 6.05 9.60 12.48 (%) of Changes -23.20 % 232.41 % 58.67 % 30 %
(%) of changes2.5 232.41%
21.5 1 58.67% 0.5 0 0 2007-2008 2008-2009 -23.20% 2009-2010 (%) of changes 2010-2011 2011-2012 30%
Interpretation : The return on propritory fund ratio of last five years shows that sharholders gate 12.48 profit which is very good for companys image. But it was very low in 2008-09 i.e. 1.82. 19
3 Net profit to total assets ratio :This ratio establishes the relationship between the net profit and otal assets. This ratio tries to findout how efficient the company was in utilizing the funds to generate or earn profit. Net profit Net Profit to Total Assets Ratio = -----------------Total assets
Net profit (a)
Total assets (b) 50676.34 46590.91 46828.82 52184.81 58004.16 [Rs in lacks]
Ratio (a/b) 0.02 0.01 0.04 0.06 0.07
(%) of changes -50 % 300 % 50 % 16.66 %
07-08 08-09 09-10 10-11 11-12
837.40 593.50 2061.84 2926.51 3858.95
(%) of changes350 300 250 200 150 100 50 0 -50 -100 2007-2008 2008-2009 -50 2009-2010 2010-2011 2011-2012 0 50 16.66 300
(%) of changes
4 Creditors turnover ratio :This ratio, also known as payable turnover ratio establishes the relationship between the net credit purchases and the average trade creditors. Creditors Creditors Turnover Ratio = ----------------------------- 365 net credit purchase
Credit purchase (b) 26805.11 19599.14 24158.08 23612.85 29673.28 [Rs in lacks]
Ratio (a/b) 31.63 13.43 7.02 10.91 8.33
(%) of changes -57.54 % -47.72 % 55.41 % -23.64 %
07-08 08-09 09-10 10-11 11-12
2322.75 2631.58 1696.07 2575.36 2473.88
(%) of changes80 60 40 20 0 -20 -40 -60 -80 55.41
0 2007-2008 2008-2009 2009-2010 -47.72 (%) of changes 2010-2011 2011-2012 -23.64
Interpretation : Creditor turnover ratio was 8.33 times in 2011-12 which shows that the disbursment of money is faster in the company. It was very slow in 2007-2008 when ratio was 31.63 times. 21
5 Debtors turnover ratio :Debtor turnover ratio, also known as receivables turnover ratio or debtors velocity establishes the relationship between the net credit sales of the year and the average receivable.
Debtors Debtors Turnover Ratio = ----------------------- 365 Net credit sales [Rs in lacks] Years Debtors (a) 07-08 08-09 09-10 10-11 11-12 6673.30 6532.28 3120.00 3423.73 3797.57 Credit sales (b) 46044.16 40347.01 44459.79 45167.17 52431.08 Ratio (a/b)x365 52.90 59.09 25.61 27.67 26.43 (%) of Changes 11.70 -56.65 8.04 -4.48
(%) of changes20 0 -20 -40 -60 -80 -56.65 (%) of changes 2007-2008 2008-2009 2009-2010 2010-2011 -4.48 2011-2012 0 11.7 8.04
Interpretation : Debtor turnover ratio was 26.43 times in 2011-12 which shows speady collection of money. But it was lower in 2009-10 i.e. 25.6. so company should take corrective measures 22
"Management is the development of people and not the direction of the things..... Management and Personnel Administration are one and the same. They should never be separated" [Lawrwnce A Appley] Manpower is the most important resource of any organization. Broadly speaking Personnel Management is a link between top management and workers or it is like a bridge between employers and employees and it is consider with human relationship within the organization
personnel manager has to do the calculation of how many people will require in the firm and at which post other is acquiring right place, right place & in right number. It also analyzes each job to determine the nature of work, the qualification necessary; the amount of supervision required, etc.
Human Resource Management is that part of management which is concerned with people at work & their relationship within the organization. The term Human Resource Management refers to the management of personnel in the organization of any company to achieve the predetermined goals. The duty of the personnel manager is to look after the personnel department and various functions of the personnel like recruitment, selection, promotion, transfer, etc.
1. HR VISION OF THE COMPANY To be a leader and take advantage of our leadership position in all food product categories We are looking forward to steady well defined growth with our focus on consultancy and business services for our customer. Making lives of people involved more meaningful, interesting, exciting and Comfortable by helping them meet their self actualization needs and other social needs. To achieve collection spirit for to cover competence environment. To upgrade quality of work life of employees
2. HR MISSION To ensure satisfaction to the workers so that they are freely ready to work. To attain maximum individual development. To improve efficiency of the human resources. To cover all over Gujarat boundaries. To cover maximum market of Gujarat To achieve collection spirit for to cover competence environment. To upgrade Quality of work life of employees
3. HR MANAGEMENT ACTIVITIESOrganization planning Human Resource planning i. Job Analysis
ii. Job Description iii. Job Specification Acquisition of human resource Managing Performance Motivational activities Training & Development Activities Compensation and Benefits Health and Safety Provision Organization Development Encouraging participation in management Grievance procedure etc.
4. HUMAN RESOURCE PLANNING PROCESS
"The process of determining manpower requirement and the means for meting those requirements in order to carry out the integrated plan of the organization." [Terry Coleman] Human resource planning is the process of forecasting a firms future demand for and supply of the right type of people in the right time
The ongoing process of systematic planning to achieve optimum use of an organization's most valuable asset - its human resources. The objective of human resource (HR) planning is to ensure the best fit between employees and jobs, while avoiding manpower shortages or surpluses. The three key elements of the HR planning process are forecasting labor demand, analyzing present labor supply, and balancing projected labor demand and supply.
The HR plan needs to be flexible enough to meet short-term staffing challenges, while adapting to changing conditions in the business and environment over the longer term. Human resource planning is also a continuous process.
The key areas of HRM Process are
1) Human resource planning 2) Attraction also called as recruitment 3) Selection 4) Direction 5) Training and development 6) Performance appraisal 7) Promote, demote or transfer regarding to performances
HR PROCESS CHART
Forcasting the future demand for HR
Estimating the HR supply
Comparing the forcasting with the HR supply
Developing Strategy Plans
Measuring Performan ce
[Human resource planning chart]
A. FORECASTING THE FUTURE DEMAND FOR HUMAN RESOURCE: The first step of human resource planning in Evershine Appliances is to forecast the future demand of employees. The existing job design and analysis may thoroughly be reviewed keeping in view the future capabilities, knowledge and skills of present employees. One of the important aspects of demand forecasting is the forecasting of the quality of human resource in skills, knowledge value, capabilities etcin addition to quantity of human resource.
B. ESTIMATING THE HUMAN RESOURCE SUPPLY: The first step of forecasting the future supply of human resources is to obtain the data and information about the present human resource inventory.
EXISTING INVENTORY: The data relating to present human resource inventory in terms of human resources components, number, designation-wise and department-wise should be obtained. Principal dimensions of human resource inventory are: 28
1) Head counts regarding total, department-wise, sex-wise, designationwise, skill-wise, pay roll-wise etc. 2) Job family inventory includes number and category of employees of each job family, i.e., all jobs related to the same category like clerks, cashiers etc., each sub-job family, i.e., all jobs having common job characteristics like production engineer and maintenance engineer etc. 3) Age inventory includes age-wise number and category of employees. It indicates age-wise imbalance in present inventory which can be correlated in future selections and promotions.
C. COMPARING THE FORECAST WITH THE HUMAN RESOURCE SUPPLY: After forecasting the future demand and the supply of human resource, the comparison of both the data is being done.
D. DEVELOPING STRATEGY PLANS: The next step is to developing the strategy plans according the result which is found by the comparison of both the data of human resource demand and supply. If there is deficit in supply of human resource, company found the resource from which they can fill the demand. They can also fill the jobs by the redeployed the employees in other jobs/departments, where the surplus of employees is estimated. And if there is surplus of human resource in company then the estimated demand, the company has to plan for redeployment, redundancy of employees etc.
E. MEASURING PERFORMANCE: After deciding the strategy plans, company measuring the performance of employees and according to that information applies the plans. 29
5. RECRUITMENTOnce the manpower required has been determined, recruitment is the next logical step in staffing process. In general Recruitment means to invite prospective candidates for joining your organization. Recruitment is the process of searching for perspective employees and stimulating them to apply for jobs in the organization. [According to Edward Flippo]
Recruitment process of the company: In Lucky sauce, Recruitment is done in following ways: 1) Internal Source Internal sources refer to the employees within the organization whenever vacancy arises somebody from within the organization may be looked for by giving promotion. Present employees Former employees Friends and relatives of present employees 2) External Sources External sources means recruiting the personnel from outside the organization for these they give Advertisement in newspaper, periodicals by giving detail about the job requirement, salary, perquisites, duties and responsibilities, etc. Educational institutes Employment exchanges Labor unions Casual applicants
6. SELECTION Selection is the process of choosing the individuals who possess the necessary skills, abilities and personality to successfully fill specific jobs in the organization.
Selection process of the company:-
1) Primary Interview At this stage, to short out the unqualified and unskilled candidate because of lack of certain requirement in education, age, experience, knowledge etc. It is important because unqualified are list out. So that company can save time and expenditure behind them.
2) Written Test They also take written test, which includes logical reasoning, general English, numerical questions, general knowledge, aptitude test i.e. aptitude is for checking whether the candidate is capable to work in the field or not and also to check his depth in the relevant field. Communication skill and presentation skill are checked for that essay writing is also included in this test.
3) Personal Interview After going through written test, in lucky sauce, they take their aptitude and attitude test on the basis of their hobbies and other social interest. They give more importance to these two points with other relevant questions of relevant fields.
4) Final Approval When all tests, interviews, etc. are over a summary report is prepared and is for tended to the authority with suggestions for his approval or advice.
5) Placement The selected candidate is placed on job for which he/she is selected.
7. TRAINING AND DEVELOPMENT
Training is a short term process utilizing a systematic & organized procedure by which non managerial personnel learn technical knowledge & skilled. Training is a process of increasing the knowledge and skill for doing a particular job. It is organization by which people learn knowledge and skill for definite purpose. The basic purpose of training is to fill the gap between job requirement and present knowledge level of employee.
In the LUCKY SAUCE Company, Training for the newly recruited and selected employee depends on the amount of experience that the employee is having previously in other organization. Generally the employees are given 15 to 20 days training in which they are given the information regarding the company background, different strategies of the company and then the employee is given the information regarding the sales department. 33
A. INDUCTION TRAINING
Induction training is the process of familiarizing the newly appointed employee about the job they have to perform, colleagues with whom they have to work, the superiors from whom they have to receive instructions and also about the history of the company its vision and mission, management philosophy and practice and rules-regulation and policies of the company. Induction is the process of receiving and welcoming an employee when he first joins the company and giving him the basic information he needs to settle down quickly and happily and start work. According to Armstrong
In LUCKY SAUCE when any new employee is selected then first he is taken for a tour of the manufacturing plant. There he is explained various processes and he meet with different employees and finally the head inducts the new employee in his place.
F. EXECUTIVE TRAINING Managers have to make decision. Some decision are routine and simple but some decision have fore reaching implication affecting the fate of the company, there for all the department manager are expected to make natured decision company expert to train executive expert teaches executive how to set goal and how to achieve it.
8. PROMOTIONPromotion means the advancement of an employee to a better job -betters in terms of greater responsibilities more prestige or status, greater skill and especially, increased rate of pay or salary. [According to Pigors and Myers]
Due to Promotion, he feels a sense of respect for the employer for appreciation of his work and his morale and enthusiasm also increases.
As LUCKY SAUCE is a small scale industry and as such there are not much more fficer, deputy manager, personnel officer, asst. personnel officer etc. that they can give promotion. Promotion is not given in Lucky Canning co. because all the workers have to do same type of work there are no prospect for higher post and thus they are not having promotional policy.
9. TRANSFERTransfer means shifting of the employee from on job to another any change in status or salary. Transfer as a change in job where the new job is substantially equal to the old one in term of pay, status and responsibilities. [According to Edwin B. Flippo] As LUCKY SAUCE has no other branch so they cannot transfer the employee. But can terminate, it means can restrict out from the company if he does not follows the rules and does not work will as per the organization needs and thus are not having transfer policy.
10. PERFORMANCE APPRAISALPerformance Appraisal is the process of obtaining, analyzing and recording information about the relative worth of an employee. Performance Appraisal and Merit rating are used synonymously. Performance Appraisal is the systematic, periodic and an impartial rating of an employees excellence in matters pertaining to his/her present job and potential for a better job. It is the process of obtaining, analyzing and recording information about the relative worth of an employee.
[According to Flippo] Advantages of Performance Appraisal of companys point of view are as follows. To effect promotion performance. To confirm the services of probationary employee upon the completion of the probation period satisfactory. To check training and development needs pay-raise where regular of employee. To decide upon the based on components based on competence and
pay scale have not fixed.
To decide upon the pay-raise where regular pay scale have not fixed. To let the employee know where they stand as far as their performance is concerned and to help them with constrictive criticism the purpose of their development. To improve communication Performance Appraisal can used to determine whether human resource program such as selection, training and transfers have been effective or not. and guidance for
Essential of Performance Appraisal system in the Lucky Canning co.. are below here: -
Clear objectives. Standardization training Job relatedness Feedback and participation Individual differences Review and appeal
In this way Performance Appraisal system is very useful to company.
Process of the Performance Appraisal in the Lucky Canning co.. There are five types of the Recruitment process uses in Lucky Canning co.. which are below here;
A. ESTABLISHING PERFORMANCE STANDARDS :The first step in the process of performance appraisal is the setting up of the standards which will be used to as the base to compare the actual performance of the employees. This step requires setting the criteria to judge the performance of the employees as successful or unsuccessful and the degrees of their contribution to the organizational 38
goals and objectives. The standards set should be clear, easily understandable and in measurable terms. In case the performance of the employee cannot be measured, great care should be taken to describe the standard.
B. COMMUNICATING THE STANDARDS :Once set, it is the responsibility of the management to communicate the standards to all the employees of the organization. The employees should be informed and the standards should be clearly explained to them. This will help them to understand their roles and to know what exactly is expected from them. The standards should also be communicated to the appraisers or the evaluators and if required, the standards can also be modified at this stage itself according to the relevant feedback from the employees or the evaluators.
C. MEASURING THE ACTUAL PERFORMANCE :The most difficult part of the Performance appraisal process is measuring the actual performance of the employees that is the work done by the employees during the specified period of time. It is a continuous process which involves monitoring the performance throughout the year. This stage requires the careful selection of the appropriate techniques of measurement, taking care that personal bias does not affect the outcome of the process and providing assistance rather than interfering in an employees work.
D. COMPARING THE ACTUAL WITH THE DESIRED PERFORMANCE :The actual performance is compared with the desired or the standard performance. The comparison tells the deviations in the performance of the employees from the standards set. The result can show the actual performance being more than the desired performance or, the actual performance being less than the desired performance depicting a negative deviation in the organizational performance. It includes recalling, evaluating and analysis of data related to the employees performance.
E. DISCUSSING RESULTS :The result of the appraisal is communicated and discussed with the employees on one-toone basis. The focus of this discussion is on communication and listening. The results, the problems and the possible solutions are discussed with the aim of problem solving and reaching consensus. The feedback should be given with a positive attitude as this can have an effect on the employees future performance. The purpose of the meeting should be to solve the problems faced and motivate the employees to perform better.
F. DECISION MAKING The last step of the process is to take decisions which can be taken either to improve the performance of the employees, take the required corrective actions, or the related HR decisions like rewards, promotions, demotions, transfers etc.
11. WAGES, SALARY & PAYROLL SYSTEM OF COMPANYWages may be defines as the price paid for the use of labor. Thus, wages are the compensation for the services rendered by the employees to the organization, wages include salaries but there is a slight difference. Wages are directly related to production only while salary is the compensation for services rendered by the persons whose output is difficult to measure. The chief executive officer is responsible for developing the wage and salary policies and procedures to administer the wages and salaries.
Any company pays wages and salaries at different rates to different workers. Usually the workers are paid on monthly basis but some workers are paid on contract basis. Other than salaries employees are given allowances like PF, Bonus, etc.
In LUCKY SAUCE, there is rise in salary every year. Based on different category of employee the wages is given from 5000 to 15000 to all workers on monthly basis and every year bonus is given on Diwali time.
12. INCENTIVE SYSTEMBONUS A Lucky Canning co. also gives bonus to their employees as per the Bonus Act 1965 by government of India. Minimum 8.33 % and maximum 20 % of wages and salary are allowing as bonus in the organization. A Lucky Canning co. gives 10 % of wages and salary as bonus to their employees at every Diwali.
HOLIDAYS Lucky Canning co. provides its workers 30-35 Holidays in the year. If the employees are not using it. It gives the benefit to employees in cash.
MEDICAL EXPENSE Company has done medical expenditure for its worker. When worker are injured during work time, company provide medical facility.
13. WELFARE ACTIVITIESAccording to the Arthur James Todd, Employee Welfare means anything done for the comfort and improvement, intellectual or social of the employees over and above the wages paid, which is not a necessity of the industry. According to the Oxford dictionary employee welfare or labors welfare means the efforts to make life worth living for workmen.
Welfare Activities Welfare activities mean those activities which are doing always in favor of employees. It means the special extra facilities given to employees from company. Lucky Canning co.. Company Provides such kind of facilities to employees which are as follow. 1. Provide good condition of equipment and also provide better environment for work 2. Company provides individual changing room, store room, rest room etc. a. First aid box provided to all department. b. Safety devices like helmet, glows, safety shoot are provided by the company in production area units. There are two type of welfare activates 1. Intramural 2. Extramural
1. Intramural: -
These Services are provided within the establishment. These include washing & bathing facilities, rest room, uniform, medical aid, recreation facilities.
2. Extramural: -
These services are provided outside the establishment. These include housing accommodation, transport, maturity benefits, sports field, holiday home, etc.
Production is the process of converting the raw materials and/or the order inputs into the products for the further production or finishes goods or service so that the utility of the input is created or enhance (by change in physical form or chemical property or mechanical property) and the need of consumer are satisfied.
Example:- consumer goods, industrial good & services of transport, medical treatment, education, banking insurance, post & telegram.
PRODUCTION MANAGEMENT:Production management means creating & maintaining an environment in which individual working together in groups willingly contributes their best to produce the specified good or services by optimum utilization of raw material and other inputs so as to timely satisfy the needs of the customer.
1. RAW MATERIAL PURCHASE POLICYThere is no any special purchasing policy of a company for purchasing raw material. It mainly pays the attention on quality of a raw material for products. They purchase raw material from sardar market with their regular terms and conditions. It is the only suppliers from where firm purchases raw material from so many years. It is the official and reliable market on whom management trust for raw material.
2. MATERIAL HANDLING EQUIPMENT
A. WASHER MACHINE
Basic Information:Model NO.: CXJ-2
Additional Information:Trademark: HUANYU Standard: ISO Origin: China
Product DescriptionFor washing tomato and preliminary selection Capacity: Power: Overall dimensions: 2 tone/hour 1.67kw 2350*910*1600mm
B. STEAM JACKETED KETTLE
Basic Information:Model NO.: ss304
Additional Information:Trademark: YIDA Standard: ISO Origin: China
Product Description Stainless steel jacketed kettle is used for frying, boiling and concentration. And we could also add the mixing device to the machine according to the customers requirements.
C. CRUSHER MACHINE
Basic Information:Material: Farm Product Type: Stir Mixing
Additional Information:Trademark: Origin: jiadi Shanghai China
Product DescriptionThe structure is hammer slice type so the crusher cannot damage the seed and guarantee the color and flavor. Compared with abroad centrifugal crusher, this machine can get smaller particle size of tomato peel which increases the lycopene of tomato products.
Closed form hopper type designing to avoid the splashing of the material which can make the material crush adequately.
Power (kw) 7.5
D. GLASS BOTTLE LABELING MACHINE
Basic Information:Model NO.: HY-150
Additional Information:Trademark: Hunayu Standard: Origin: 3000*1700*1600mm Packing Size China
Product DescriptionThis machine is suitable for labeling all kind of regular or irregular containers. It can label double single label, which is high speed and high precision.
1) Double sides labeling machine. 2) Servo motor 3) PLC control system 4) High precision 5) Easy to operate and top quality
Feature: 1) It can label one or two labels, the user can choose it freely. 2) It can work with printer or code machine. 3) It can separately or works connecting with conveyor.
3. PROCESS OF PRODUCTIONSince the company is small they are going to Manufacture on the small scale region only. There are certain steps which show there way of making:-
selection of raw material washing of raw material boiling and juice extraction
Addition of preservatives cooking and packing
selection of raw material
Ripe tomatoes are taken. Green and unripe tomatoes are discarded as it would discolor the final product. The tomatoes are first washed. Here rinsing of tomatoes is not enough because mold filaments and other micro-organisms found in their cracks and wrinkle folds and stem cavities are not easily dislodged.
Step:-2 washing of raw material The washer is first receives the tomatoes in a tank, holding them for a sufficient length of time to soak and to loosen the dirt, and then submits all parts to a thorough spray under strong pressure.
Step 3:- boiling and juice extraction After washing, the tomatoes are trimmed, cut into small pieces before boiling. The tomato pieces are boiled in their own juice in steam jacketed kettles for 3 to 5 minutes to facilitate pulping. The juice is extracted by passing the cooked tomatoes through a pulper. The juice is normally contains solids at 5.66% and a specific gravity of 1.024
Addition of preservatives
The ketchup is prepared by concentrating the juice obtained from the pulper. Spices, salt, sugar, vinegar, onions, garlic, etc are to be added to the extent, it contains not less than 12% tomato solids and 28% total solids. The following recipe is used to manufacture ketchup. The spices are loosely tied in a muslin bag and is placed in the juice and boiled till The desired consistency is obtained Add sugar and salt to the vinegar and stir. Add the mix to the ketchup and stir thoroughly to form a homogenous
cooking and packing
When the ketchup has been cooked, it is passed through a sieve to remove any fibrous material or external contaminants. The ketchup should be bottled at 190 degrees Fahrenheit to prevent darkening of its color and loss of vitamin contents during Storage. On cooling, the ketchup shrinks in volume, producing thereby a high degree Of vacuum in the bottle. Sometimes a black ring is formed on the surface of the Ketchup bottle. This is known as "black neck". It is because of the oxidation of the Iron compounds which enter into the ketchup from the boiling equipment and from the metal of the cap through the action of acetic acid.
4. QUALITY CONTROLQuality is measure of totality of attributes of a product or service which impart it functional or aesthetic value so as to satisfy the needs of end customers for a given price paid by them. Quality control is the system of policies, procedures and guidelines which establish and maintain the specified standards of quality. LUCKY SAUCE PVT LTD also controls the equality of its ketchup. The main
objectives behind controlling quality of its ketchup are as follows: To satisfy the functional or aesthetic needs of end users of goods or services. To clear define top managements commitments towards quality and production To design the product which has features as required to satisfy the needs. To make supervision more effective. To involve and train employees in quality control activities. To balance the costs of inspection of quality and benefit of quality control To balance between customer requirement and organizations capability to meet them.
Quality policy of Lucky Canning co.. To satisfy customer need and expectation. Striving for continuous improvements through implementation of ISO 9001:2000. Establishing, Communicating and reviewing measurable quality objections. Developing and improving employee skills through effective training. Maintaining safe working practices.
In Lucky Canning co.. the system of checking the quality of goods when it is in progress, the exports keep on their eye on the every activity of the machine. They check the every activity of machine. They have the computerized system in which they can easily know in which machine the problem is occurs. And then they solved it.
5. MAINTENANCE POLICYMaintenance is very important and necessary. In some company they use corrective maintenance or in some company they do regular maintenance.
In LUCKY SAUCE PVT LTD, they use the regular maintenance system. They do maintenance at every week. The manager is checks all the parts of the machinery at every week. And in between if any problem occurs they suddenly try to solve it.
6. STORAGE DEPARTMENTIt is an extremely important cost that ever appears in accounting record. Components of this cost may be observed in several ways e.g. , in a profit making concern, sales lost as a result of stock out, or, there may be additional costs resulting from back ordering. Another component may be loss of goodwill due to delay in supply of finished goods. Sometimes, in production system, a part shortage may cause idle labor on a production line of subsequent incremental labor cost to perform operation out of sequence, usually at a higher than normal cost. Such type of costs may also be considered as a shortage cost. Industrial or institutional storage of material is also systematic & well documented. Because of this reason following expenses are incurred in storage of material. To receive the pack goods from the production department and store in warehouse. To receive the delivery order from the marketing department. Arrange the goods as per the order. Make the list of the boxes that will be dispatched. To make invoice. To give order to load the goods in the truck.
7. WASTAGE CONTROLWaste management is the collection, transport, processing or disposal, managing and monitoring of waste materials. The term usually relates to materials produced by human activity, and the process is generally undertaken to reduce their effect on health, the environment or aesthetics. Waste management is a distinct practice from resource recovery which focuses on delaying the rate of consumption of natural resources. All wastes materials, whether they are solid, liquid, gaseous or radioactive fall within the remit of waste management.
This is classified into two parts: 1. 2. Avoidable waste. Unavoidable waste.
Avoidable wastes play a very important role in production management. A firm who can gets control on its wastage than there is increase in its profit.
Unavoidable waste, in these types of waste there is no control of production management on it. The firm must has to face this waste.
A market is one of many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange. While parties may exchange goods and services by barter, most markets rely on sellers offering their goods or services (including labor) in exchange for money from buyers. It can be said that a market is the process by which the prices of goods and services are established. Marketing management is a process of planning and executing the conception, pricing, promotion and distribution of adequate machine and it has a very strong manufacturing infrastructure. For a market to be competitive there must be more than a single buyer or seller. It has been suggested that two people may trade, but it takes at least three persons to have a market, so that there is competition on at least one of its two sides. However, competitive markets rely on much larger numbers of both buyers and sellers.
1. MARKETING ENVIRONMENT
A. INTRODUCTION OF MARKETINGWe use a large variety of goods and services in our daily life. These include items like, toothpaste, toothbrush, soap, oil, clothes, food items, telephone, electricity and many more. How do all these goods and services reach our home? Obviously the business houses that produce the goods and services have to ensure that these are to be sold, and so they have to make the consumers/users aware of their products and place them at points convenient to the consumers. This involves a number of activities such as product planning, pricing, promotion, use of middlemen (wholesalers, retailer etc.) for sale, warehousing, transportation etc. All these activities taken together are termed as Marketing. Management definition It is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals.
Social definition A societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others
We know that the businessman produces goods and services for our use. These are not Necessarily produced at the places where they are consumed or used. Even in villages, Now-a-days you find the products manufactured all over India and in other countries. This implies that the manufacturers must be making efforts to ensure that their products are in demand and reach the ultimate consumers all over the globe. So, when you go to the market to buy a readymade shirt you find that there are several options available to you in terms of quality of cloth used, design, color, price etc. and you can buy what suits you most. This also implies that the manufactures assess the needs of the consumers, their tastes and preferences and plan the products accordingly. Not only that, they also ensure that people are aware about the product and its features. All these activities are said to be part of marketing function of any organization. Thus, marketing refers to the process of ascertaining consumers needs and supplying various goods and services to the final consumers or users to satisfy those needs. The American Marketing Association defines marketing as an organizational function and set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
Basically, marketing is the performance of business activities that direct the flow of goods and services from producers to consumers or users.
B. IMPORTANCE OF MARKETINGMarketing is important to the business, consumer as well as the society. This is evident from the following
(a) Marketing helps business to keep pace with the changing tastes, fashions, preferences of the customers. It works out primarily because ascertaining consumer needs and wants is a regular phenomenon and improvement in existing products and introduction of new product keeps on taking place. Marketing thus, contributes to providing better products and services to the consumers and improve their standard of living.
(b) Marketing helps in making products available at all places and throughout the year. We are able to get Kashmir shawls and Assam Tea all over India and get seasonal fruits like apple and oranges round the year due to proper warehousing or proper packaging. Thus, marketing creates time and place utilities.
(c) Marketing plays an important role in the development of the economy. Various functions and sub-functions of marketing like advertising, personal selling, packaging, transportation, etc. generate employment for a large number of people, and accelerate growth of business.
(d) Marketing helps the business in increasing its sales volume, generating revenue and ensuring its success in the long run.
(e) Marketing also helps the business in meeting competition most effectively.
C. OBJECTIVE OF MARKETING After knowing the points of importance of marketing let us discuss on the basic objectives of marketing.
Provide satisfaction to customers
All marketing activities are directed towards customer satisfaction. Marketing starts With ascertaining consumer needs and produce goods that satisfy those needs most Effectively. Not only that the pricing and distribution functions of marketing are also planned accordingly II. Increase in demand
Through advertising and other sales promotional efforts, marketing aims at creating additional demand for their products. Satisfied customers also help in creating new customers. For example, if you buy a gel pen and feel satisfied, next time also you will buy the same pen and obviously when you tell others about it they will also feel like giving it a try.
Provide better quality product to the customers
This is a basic objective of marketing. The business houses try to update and upgrade their knowledge and technology to continuously provide better products. If they do not do so, they will be phased out through competition.
Create goodwill for the organization
Another objective of marketing is to build a good public image and create goodwill for the organization. This helps in maintaining loyalty to the product and accepting new products of the same company.
Generate profitable sales volume
The ultimate objective of all marketing efforts is to generate profitable sales volumes for the business. Taking care of customer needs and wants by providing the required goods and services at prices they can afford, and at places and timing that are convenient to them ultimately lead to increased sales and profits. 58
2. SEGMENTATION, TARGETING, POSITIONING
A. SEGMENTATIONResearch plays an important role in segmentation as segmentation analysis requires a range of data form a wide variety of sources on markets, customers attitudes, motives and behavior as well as competitor information. B. TARGETING TARGET MARKET Targeting is the next step in the sequential process and involves a business making choices about segment(s) on which resources are to be focused. There are three major targeting strategies: undifferentiated, concentrated, and differentiated. During this process the
business must balance its resources and capabilities against the attractiveness of different segments. The LUCKY SAUCE PVT LTD, targets the customers status. Company made the different flavors sauces according to the test and preferences of the customers.
C. POSITIONINGPositioning follows on logically from the segmentation and targeting stages. Customer perceptions are central to the product position especially in relation to the competitions offering. The product or service has to satisfy key customer requirements and this has to be clearly communicated to customers. A tool that helps marketers understand customer perceptions of their brand is perceptual mapping and a position approach can be used to develop a clear positioning strategy. However, a number of positioning problems can arise.
3. CONSUMER BUYING BEHAVIORConsumer buying behavior can be defined as acts of individuals in obtaining and using a product or services including the decision processes that precede and determine these acts There are two types of customers. One is the individual customers who buy for self and family consumption. The second is industrial or organization customers who buy the plant and machinery tools and equipment, raw-materials, spare parts and consumables as inputs for industrial production. For the marketer it is essential to study the buying behavior of both- consumer and the industrial buyer. The last item which is produced by the lucky sauce, is mostly used by end users (consumers), so that is why there is concept of consumer buying behavior
A. CONSUMER BUYING PROCESS
Buying behaviors of the consumer depends upon his involvement in the product. However general observation and research indicate that generally consumers for reaching to buying decision undergo a behavioral process consisting of consecutive five steps as under
NEED RECOGNITION: - problem recognition or identification of need is the starting point of buying behavior process. The buyer senses difference between his actual state and a desired state. First the consumer identifies his/her need. It includes what kind of the product they want or need to feel satisfaction and produce their product.
INFORMATION SEARCH: - The second level is the active information search. In this stage after deciding the product consumer will start gathering information about the product. Every consumer will pass two stage of information gathering: Heightened attention:- in this consumer is not having detailed knowledge about the product the consumer will become more receptive to information Active information search:- After knowing about the product consumer will enter into second stage active information gathering in which consumer will take active part and start searching for information. He/ she may start collecting material, meeting to friend, relatives, neighbors, families. Etc
EVALUATION OF ALTERNATIVES:- after preparing the list of alternative product the consumer undertakes the evaluation process. There are no set criteria for the evaluation of the product. However consumer tries to evaluate the product on the basis of its features. Expectancy- value model or Compensatory modelAttributes
Lucky Kissan Maggi
5 4 2
1 1 1
60 91 90
9 9 9
[Test: 1- excellent, 10- poor]
PURCHASE DECISION:- in the third evaluation stage the consumer form References among the alternative brands. The consumer may also form the intention to buy the most preferred brand.
POST PURCHASE SATISFACTION:- satisfaction is the differences between consumer expectation and performance. After purchasing the product, if the performance of the product is not matching with an expectation of a consumer then consumer will not be satisfied. If performance matches with an expectation then consumer will be satisfied. If performance off the product exceeds expectation then consumer will be very satisfied.
4. 4 PS OF MARKETING
A. PRODUCT1) INTRODUCTION In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process. Product is something produced by human or mechanical effort or by a natural process. A set of attributes in the form of physical product or services and ideas offered to the consumer for the satisfaction f his needs. It includes physical product, services, ideas, personalities, place and organization. -Philip Kotler 2) PRODUCT MIX The product mix of a company, which is generally defined as the total composite of products offered by a particular organization, consists of both product lines and individual products. A product line is a group of products within the product mix that are closely related, either because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges. Product mix is also called as product assortment which is the set of all product lines and items that a particular seller offers for sale to buyers.
WIDTH SAUCE D E P T H Tomato ketchup Tikhameetha Tangy sauce Red chilly Green chilly Soya sauce Vinegar 63
Width: The width of a product refers to how many different product lines the company carries. The above table shows a product width of 7 lines.
Length: The length of the product refers to the total number of items in the mix.
Depth: The depth of a product refers to how many variants are offered of each product in the line.
3) PRODUCT LIFE CYCLE A new product progresses through a sequence of stages from introduction to growth, maturity, and decline. This sequence is known as the product life cycle and is associated with changes in the marketing situation, thus impacting the marketing strategy and the marketing mix.
In the introduction stage, the firm seeks to build product awareness and develop a market for the product. The impact on the marketing mix is as follows: Product branding and quality level is established and intellectual property protection such as patents and trademarks are obtained. Pricing may be low penetration pricing to build market share rapidly, or high skim pricing to recover development costs. Distribution is selective until consumers show acceptance of the product. Promotion is aimed at innovators and early adopters. Marketing communications seeks to build product awareness and to educate potential consumers about the product. II. GROWTH STAGE
In the growth stage, the firm seeks to build brand preference and increase market share. Product quality is maintained and additional features and support services may be added. Pricing is maintained as the firm enjoys increasing demand with little competition. Distribution channels are added as demand increases and customers accept the product. Promotion is aimed at a broader audience. III. MATURITY STAGE
At maturity, the strong growth in sales diminishes. Competition may appear with similar products. The primary objective at this point is to defend market share while maximizing profit. Product features may be enhanced to differentiate the product from that of competitors. 65
Pricing may be lower because of the new competition. Distribution becomes more intensive and incentives may be offered to encourage preference over competing products. Promotion emphasizes product differentiation. IV. DECLINE STAGE
As sales decline, the firm has several options: Maintain the product, possibly rejuvenating it by adding new features and finding new uses. Harvest the product - reduce costs and continue to offer it, possibly to a loyal niche segment. Discontinue the product, liquidating remaining inventory or selling it to another firm that is willing to continue the product.
Currently, Lucky sauce is existence at the growth stage. Because, Company added new product feature and maintain its quality. Company maintains its price and enjoys increasing demand with little competition. Channel of distribution are added and customer accept the product. 4) PACKAGING AND LABELING Packaging means, The wrapping of goods before they are transported or stored or delivered to a consumer. In the other hand, packaging is the sub-division of the packaging function of marketing. Packaging has been defined as, an activities which is concerned with protection, economy, convenience and promotional consideration
We can define packaging as: all the activities of designing and producing the container is called the package The packaging has three levels, they are following:Primary package Secondary package Shipping package LABELING Label is a part of product, which carries verbal information about the product or the seller. It may be a part of a package, or it may be a tag attached directly to the product. Label may be small slip or a printed statement. In LUCKY SAUCE PVT LTD, company labeling can be done accordingly its product. Following are the labels of different products.
TOMATO KETCHUP :-
Tomato pulp, sugar, Salt Acidity regulator (e- 260, e -330), Sterilizing agents (e- 415, e 1442), Red chili powder, Growad spices and spices extract contains permitted class 2, Preservative (e 211)
Nutrition Energy Protein Carbohydrate Total sugar Sodium Fat
100gm 130 kal. 1 kg 33kg 20 g 1.3 g 0g
The packing is available in 300gm, 500gm, 1 kg, 1.2 kg, and 5 kg.
TIKHAMEETHA SAUCE :-
tomato pulp , vegetable pulp , sugar , salt , acidity regulator(E- 260) (E-330) , sterilizing agents (e- 415 , e -1442) ,Red chili powder Spices extract contains permitted class 2 preservative (E 211)
Nutrition Energy Protein Carbohydrate Total sugar Sodium Fat
(100 gm) (100 kal.) (1 kg) (30 g) (15 g) (1.3 g) (0 g)
The packing is available in 300gm, 500gm, 1 kg, 1.2 kg, and 5 kg.
100 % mix vegetable and fruit pulp , sugar , salt , acidity regulator(E- 260) (E-330) , Emulsifying stabilizing agent ( E-415 ) , ( E-1442). Red chili powder grown spices and spices extract contains permitted class 2 preservative (E 211)
Nutrition Energy Protein Carbohydrate Total sugar Sodium
(100 gm) (150 kal.) (1 kg) (35 g) (20 g) (500 mg)
The packing is available in 300gm, 500gm, 1 kg, 1.2 kg, and 5 kg.
RED CHILLY SAUCE:-
potatoes , red chilies , sugar , salt , acidity regulator(E- 260) (E-330) , garlic , stabilizing agent ( E-415 ) , ( E-1442) , and spices extract contains permitted class 2 preservative ( E 211) .
Nutrition Calories Total fat Saturated fat Iron fat Cholesterol Sodium Carbohydrate Dialing fiber Sugar Protein
(100 gm) (35.) (0.5 gm) (0) (0) (0) (2605.5 gm) (4.3 g) (3.6 g) (5 g) (1 g)
GREEN CHILLY SAUCE:-
Potato , green chili , sugar , salt , acidity regulator(E- 260) (E-330) , garlic , stabilizing agent ( E-415 ) , ( E-1442) ,grown spices and spices extract contains permitted class 2 preservative ( E 211) .
Nutrition Energy Total fat Saturated fat Iron fat Cholesterol Sodium Total Carbohydrate
(100 gm) (40 kal.) (0.5 g) (0 g) (0) (0) (1705 gm) (6.8 g) 69
Diellingfibre Sugar Protein
(1.9 g) (1.9 g) (0.5 g)
Soya been entreats, sugar, salt, acidity regulator (E- 260) and curtained contains permitted cllas-2 preservative (E-211).
Nutrition Energy Total fat Unsaturated fat Cholesterol Sodium Carbohydrate Diellingfibre Sugar Protein
(100g) (40 kal.) (0.1g) (0.09) (0) (2560 g) (8.6g) (0.4g) (6.7g) (0.9g)
Water, Acidity regulator (e 260), Acetic acid Nutrition Energy Protein Carbohydrate Total sugar Sodium (100 g) (0 kal.) (0 .g) (0 .g) (0 g) (0 .g)
The pickings are available in 300gm, 500gm, and 1kg
A. BRAND Brands means a name, a term, a sign, a symbols or a combination of these intended to identify the goods or services of one seller or groups of seller and to differentiate them from those of competitors.
A brand is a sellers promise to deliver consistently a specific set of features, benefits, and services to buyers. The best brands convey a warranty of quality.
IMPORTANCE OF BRAND: It is easy to identify the product. The brand gives a separate identify to a product and from competitors. Brand can be trade mark. Brand gives legal protection. The producers can be a symbol of quality. Price difference can be possible by brand.
B. PRICE 1) INTRODUCTION Price is the element of the marketing mix that creates sales revenue, the other element is cost. -Philip Kotler A value that will purchase a definite quantity, weight, or other measure of a good or service. In ordinary usage, price is the quantity of payment or compensation given by one party to another in return for goods or services. In modern economies, prices are generally expressed in units of some form of currency. In all modern economies, the overwhelming majority of prices are quoted in (and the transactions involve) units of some form of currency. Although in theory, prices could be quoted as quantities of other goods or services this sort of barter exchange is rarely seen.
2) OBJECTIVES OF PRICING
"Volume objectives include sales maximization and market-share goals, which are specified as a percentage of certain markets. In sales maximization, management sets an acceptable level of profitability and then tries to maximize sales. This objective can lead to discounting or some other aggressive pricing strategy, such as rebates and sales. " [Prof.Allen says]
Profit Oriented: Target Return
sometimes the vendor specifies a specific dollar amount or percentage amount that the price will be offered at in order to make a profit which has been calculated for a specific purpose. Usually this amount is part of a larger plan involving several product units in a product line II. Profit Oriented: Maximize Profits -
if the Competitive Market is not intense you may charge the highest price the market will bear because sometimes you may have an advantage for reasons asked on your geographic advantage special features not available on other competitors' products very very famous brand. Etc. III. IV. V. Sales Oriented: Increase Sales Volume Sales Oriented: Increase Market Share Status Quo Goals: Meet the Competition
If the customer has many choices and you barely have the resources to stay in the market, and then just charge the same price. You don't have the resources to survive a price war, and you don't have the ability to claim better quality to charge a higher price 73
3) METHODS OF PRICING There is no specific pricing method in LUCKY SAUCE Company. The price of the product fluctuates on the basis of prices of the raw materials in the market. If the price of the raw material increases the price of the product increases simultaneously and vice versa When the price is increased, no prior information is given to the distributor, but the products will be supplied to the distributor at the prevailing price. The distributor is supposed to follow the following steps in case of price increase: The distributor and the retailer must sell their stock at the price that they have got or at the printed price of the product. The distributor should inform the retailer that he would supply the stock at the price at which the company gives him. When prices are to be reduced, The distributor will be informed seven days in advance so that he can sell off his stocks. He must ask the retailers to sell off their stock as soon as possible to avoid possible losses. He must see that the old stock is sold first and do not make a fresh supply till then, this will avoid the packets with two different prices. The company will not give price reduction on old stock.
C. PLACE 1) INTRODUCTION This term really refers to any way that the customer can obtain a product or receive a service. Provision of a product or service can occur via any number of distribution channels, such as in a retail store, through the mail, via downloadable files, on a cruise
ship, in a hair salon, etc. The ease and options through which you can make your product or service available to your customers will have an effect on your sales volume.
2) LEVEL OF CHANNELS OF DISTRIBUTION The company has multi level of distribution channel,
Multi level channel, where there are two intermediaries between the company and the final customers. The company follows this distribution channel to i.e.
ManufacturersDistributors Retailers Customers
3) ACTIVITIES OF DISTRIBUTION I. TRANSPORTATION
Transportation means movement of goods from one location to another. LUCKY SAUCE Company transports their goods into tempo, truck and Shuttle.
At Concept Services we work with companies that have a need to increase sales and to improve their sales processes. All of our clients have one thing in common; they all have a need to generate new business from new customers. In a business economy of constant change, trying to do more with less, downsizing, and the need for increased sales and efficiencies, Concept Services has evolved. We help companies to be more proactive in their sales approach and to flatten the highs and lows of seasonal sales or an ineffective sales force. Concept Services is about sales. We are not providing a product. What we provide is a "concept" that is executed as a service and is gauged by the success of our customers. III. MARGIN OF CHANNEL PARTNER
Channel partnerships provide an opportunity for companies to promote certain products or services. In return, channel partners receive access to product marketing and training, discounts, technical support, lead generation tools and beta versions of releases. A VAR that chooses to partner with a vendor may lose a certain degree of independence with respect to other vendors in the same market. As a result, these relationships make sense only when the increased access and support result in greater revenue for the channel partner. Several vendors have created online forums, discussion groups and social networking sites to encourage and support channel partnerships. IV. AFTER SALES SERVICE
After sales service is the service that the manufacturer or retailer gives to the customer after the sale of the product. This could involve maintenance or repair of the item during a warranty period, or even longer. Obviously, the after sales service that is provided depends very much on what has been sold. For example, if a customer buys some expensive software that could help their own business, the after sales service here could be the installation of the software and relevant training on how to use it.
D. PROMOTION 1) INTRODUCTION Generally, promotion is communicating with the public in an attempt to influence them toward buying your products and/or services. An activity, such as a sale or advertising campaign, designed to increase visibility or sales of a product. Promotion means a set of efforts made by the company for stimulating the demand for its product or products without making any alternative in product mix, price and channel of distribution.
Promotion is an important marketing force the provides an extra incentive (usually short term in nature) for consumers, the trade. The sales force and other influential groups The elements of the promotions mix are: Personal Selling. Sales Promotion. Public Relations. Direct Mail. Trade Fairs and Exhibitions. Advertising. Sponsorship. And also online promotions.
5. SALES PROCEDUREThe process starts when the company receives order from any distributor. On the basis of this order from, a bill and transport copy is prepared at Head Office. 3 copies of invoice are prepared of which one is sent to factory, one to distributor and one are kept at HO. The distributor sends the copy of invoice duly signed by him, which is filed, in the respective file of distributor. The vehicles used for transportation may be owned by company or may be hired from outside. At H.O. along with copy of invoice, the copy of Lorry Receipt and octroi is also filed in the respective files of distributor.
6. COMPETITIVE ANALYSISA. INTRODUCTION Competitor analysis in marketing and strategic management is an assessment of the strengths and weaknesses of current and potential competitors. This analysis provides both an offensive and defensive strategic context to identify opportunities and threats. Profiling coalesces all of the relevant sources of competitor analysis into one framework in the support of efficient and effective strategy formulation, implementation, monitoring and adjustment. Competitor analysis is an essential component of corporate strategy. It is argued that most firms do not conduct this type of analysis systematically enough. Instead, many enterprises operate on what is called informal impressions, conjectures, and intuition gained through the tidbits of information about competitors every manager continually receives. As a result, traditional environmental scanning places many firms at risk of dangerous competitive blind spots due to a lack of robust competitor analysis.
B. COMPETITORS DETAILS
1) About Maggi Tomato Ketchup :Maggi Tomato Ketchup is primarily a taste enhancer, giving the food provider taste, aroma and also contains iodized salt. Nestle was seriously working on brand extension to leverage brand success in some potential product categories. The company finally decided to enter ketchup market with the brand Maggi. Finally in 1985 when Maggi noodles had reached 4000 tones business, they ensured the establishment of the brand Maggi and launched their Maggi ketchup. Market leader Kissan was selling its ketchup in 500 gm. Nestle decided upon 400 gm bottle to give the consumer a price- point advantage. The main launched its product all over India. The main focusing aspect of their advertisement was what ketchup does to your food- tasty and more palatable. 2) About Kissan Tomato Ketchup :Today, Kissan is more than just jams, ketchups and squashes. Its all about kids eating happily and growing up happily. Filled with nothing but natural goodness, Kissan has found a way to keep both, mothers and kids happy. The brands reassurance to mothers is; they wont have to worry about their childs growth with them eating any of the Kissan products. Because Kissan lets every child enjoy what they love to eat and helps them grow. Being pioneers in food processing, Unilever launched ketchups, jams & squashes under the brand name Kissan. Squashes were the first products under the Kissan portfolio introduced in 1937, after which jams and ketchups were introduced under the Kissan Umbrella. Made from 100% real fruits and tomatoes, Kissan jams, ketchups and squashes are now even tastier, richer and yummier for kids to eat and drink , without mothers constantly having to worry about what they are consuming. Because with Kissan everything is 100% real. Kissan Tomato Puree made with nothing but fine, fresh, hand-picked tomatoes. Add it to your cooking at the same time you would normally add tomatoes and watch it blend 79
beautifully for smoother, richer soups and curries. So you get all the tastes and goodness without any bother. C. COMPARISON WITH COMPETITORS
1) MAGGI 4 Ps of Marketing of Maggi Tomato Ketchup
PRODUCT :- ( 1Kg bottle)
Available in different variants: Maggi Ketchup Maggi Hot & Sweet Sauce, Maggi Masala Chilli Sauce, Maggi Chilli Garlic Sauce, Maggi Tamarind Sauce, Maggi Tomato Sauce (Without onion & garlic), Maggi Tomato Ketchup (With onion & garlic), tomato chatpat, Teekha Masala, Tomato pudina. The product ingredients are water, tomato paste (34%), sugar, iodized salt, acidifying agent (260), thickening agent (440 & 401), onion powder, garlic powder, mixed spices and preservative (211).
They promote their product very effectively through television by adding humor in the ads. They also sponsor various cookery shows to promote alternate usage of products. Maggi was a sponsor for Hum Log, a popular television show on Doordarshan, Indias sole channel in 1984. They also use strategy of free product samples to promote it. They have distributed samples in various mall and schools in Delhi. Celebrity endorsements:- Maggi was They came up with their popular character of Pankaj and Javed to communicate with target audience Nestl carried out 80
various promotional activities as well. These included the August 1999 FunDooz campaign and Jungle Jackpot campaign .They have taken Javed Jafferi for endorsement of tomato ketchup. They used a punch line that is very effective and creates a unique image in the minds of the customers. That is its Different. On completing its 25 years in India, Maggi has changed slogan to Make a Difference. And its now campaign slogan is Mai & maire maggi. III. PLACE :-
Sold in India, New Zealand, Australia, Malaysia, Pakistan, Nigeria, Philippines and Singapore. The distribution network is well spread as it is easily available in all karyana stores, retail store etc. IV. PRICE :-
Its Maggi Rich Tomatoes is priced at Rs 90 (1 kg bottle with 20% free offer).
2) KISSAN 4 Ps of marketing of Kissan Tomato Ketchup are:-
PRODUCT :- ( 1Kg bottle)
It is available in different variants: Kissan Ketchup and Kissan Sauce (no onion no garlic), Kissan Tomchi. The product ingredients are water, tomato paste, sugar, salt, acidity regulator (260), Stabilizers (1442 & 415), condiments, onion powder, garlic powder, mixed spices and preservative (211). The thickness is more as compared to Maggi Ketchup. Due to the hidden quantity of the tomato paste in the ingredient.
No particular celebrity endorsement is used by the HUL (Hindustan Unilever Limited). The new campaign of Kissan has positioned the Kissan Ketchup a unique product. Taking the tag line "Aao banaye pakode behtar" translated to "Making Pakode taste better". In these series of ads, the brand plays a second fiddle to the main snack. The brand takes the positioning of a "Great Accompaniment " III. PLACE: -
Sold in India, U.S.A and Australia. The distribution network is well spread as it is easily available in all karyana stores, retail store etc. IV. PRICE:-
Kissan Ketchup is priced at Rs 91 (1 kg bottle).
BIBLIOGRAPHYBOOKS 1. BOOK: MARKETING MANAGEMENT EDITION: 2011-2012 AUTHOR: N.D.GAMI
2. BOOK: FINANCIAL MANAGEMENT EDITION: 2011-2012 AUTHOR: PROF.M.R.TRIVEDI : MRS.D.S.THEKKANAL
3. BOOK: MARKETING MANAGEMENT EDITION: 14th AUTHOR: PHILIP KOTLER : KEVIN LANE KELLER : MITHILESHWAR JHA
4. BOOK: HUMAN RESOURCE MANAGEMENT EDITION: 2011-2012 AUTHOR: ASWASTAHAPA
5. BOOK: PRODUCTION AND OPERATION MANAG