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ORGANISATION STUDY
CHAPTER-1
INTRODUCTION
KERAFED registered in the year 1987 as an apex
body in the co-operative sector is to implement an integrated coconut production,
procurement, processing and marketing project, funded by European Economic
Community and National Co- Operative Development Corporation with a financial
component contributed by the State Government of Kerala, to protect the interests of
the growers, it was in 1993 that the federation started commercial production.
Kerafed is one of the largest coconut oil producers in India. The first plant of
Kerafed’s coconut oil opened at Karunagapally in Kollam district is one of the biggest
such units in India. KERAFED has another plant at Naduvanoor. Now the plant is
functioning with the most modern machines in most hygienic atmosphere.
Kera in Malayalam language means coconut and hence the land of
Kera came to be known as Kerala. The coconut liquid provides food and drinks; the
shell provides domestic utensils and fiber, the leaves provide plaiting, coir is used for
flooring. No other single plant in the world has as many uses as the coconut. Kerafed
is the single largest procurer of coconut/copra, produced in Kerala.
The organization study undertaken as a part of the curriculum was
done at “The Kerala Kera Karshaka Sahakarana Federation Ltd “(KERAFED)
Thiruvananthapuram. This study helps me to learn how effectively and efficiently
manage the industry/organization. The main aim of the study is to understand the
various departments and functions of the organization
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ORGANISATION STUDY
OBJECTIVES OF THE STUDY
To understand the company’s function.
To know about the various products and services of the organization.
To know about the various department.
To analyze the organization structure.
To identify and evaluate the strengths, weakness, opportunities and threats
faced by the organization.
To understand the future programmers of the company
To interact with the employees at various levels of the organization in order to
understand their grievances.
SCOPE OF THE STUDY
The scope of the study is to know the overall performance of the
organization. It also provides a chance to see the practical constraints faced by
the managers while putting theory into practice.
SIGNIFICANCE OF THE STUDY
This study aim together information on all the departments of
Kerafed ltd. Thus study will enable in getting a partial exposure to the day today
working of an organization.
METHODOLOGY
The methodology adopted for this report through the collection of
primary and secondary data
Primary data
Data collected by the researcher from the actual site of
occurrence of events are called primary data. Primary data is obtained through
observation or through direct communication with respondents in one form or another
or through personal interviews. The primary data for the study obtained from:
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ORGANISATION STUDY
Formal interview with the staffs
Formal interview with the workers of the organization
Formal interview with the managers and the departmental heads
Secondary data
Secondary data are those data which are already
collected by someone else and which are already been passed through statistical
process. The secondary data for the study obtained from:
From previous research reports
Government publications
Company records
Text books
Annual reports
Internet
www.kerafed.com
LIMITATIONS OF THE STUDY
Certain information’s are collected through the face to face interview with
the employees, so there is a chance to biasing.
Due to their busy schedule the departmental heads restricted the
collection of detailed information.
This study was conducted within a short period, so it is not possible to
study all the aspects in detail. The detailed report of the all aspects is not
much possible.
Due to the onam season the demand of coconut oil has raised so; all the
employees are very busy in their works, so I cannot conduct a deep study
of the coconut oil complex of Kerafed at Karunagapally, Kollam district.
3
ORGANISATION STUDY
CHAPTER -2
INDUSTRY PROFILE
Coconut is the most useful tree crop ever grown in the world. It is
termed as horticulture crop, food crop and even as an oil seed. Coconut oil
has a unique role in the diet and is an important psychological functional
food. The health and nutritional benefits that can be dserived from consuming
coconut oil have been recognized in many parts of the world for centuries. It
is been scientifically proved that coconut oil doesn’t have any toxic
substances
Coconuts are part of the daily diet of many people. Its endosperm is known
as the edible "flesh" of the coconut; when dried it is called copra.
The oil and milk derived from it are commonly used in cooking and frying;
coconut oil is also widely used in soaps and cosmetics. The clear
liquid coconut water within is a refreshing drink and can be processed to
create alcohol. The husks and leaves can be used as material to make a
variety of products for furnishing and decorating. It also has cultural and
religious significance in many societies that use it.
Now people are definitely switching to coconut oil exclusively
for all their cooking needs. Coconuts play a unique role in the diet
of mankind because they are the source of important physiologically
functional components which are found in the fat part of whole coconut.
Coconut oil is also known as coconut butter, is tropical oil extracted
from copra (the dried inner flesh of coconut) with many applications. It
constitutes 7% of total export income of the Philippines, the world’s largest
exporter of the product. In recent years India has attained top position
in production of coconut, overtaking.
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ORGANISATION STUDY
COCONUT INDUSTRY IN INDIA
India has recently achieved the distinction of being the highest producer
of coconuts in the world, having overtaken the next highest producer, the Philippine
Islands. However the average coconuts produced per palm in this country is dismal,
standing at about 46 nuts per palm per year in 2006-07 compared to 30 nuts per palm
in 1950-51.
Coconut is being cultivated in an area of over 1.94 million hectares in
India. The estimated requirement of coconut seedlings in the country is in the region
of 30 million per annum. About 90% of the coconut growing area is situated in the
four southern states of India, with Kerala occupying about 50% of coconut cultivated
area in India.
Global trade is reaching towns and cities across continents and in the
most remote places. Due to the changes in progress and development, there is a need
for seeking out products that give added value and save time and effort. Packaged
Tender Coconut Water is available outside hospitals today. The ubiquitous vendor of
tender coconuts is almost on every street.
Coconut products:
1. Raw Kernel
2. Copra
3. Coconut oil
4. Tender coconut water
5. Coconut cake
6. Coconut toddy
7. Coconut shell based products
8. Coconut wood based products
9. Coconut leaves
10. Coir pith
5
ORGANISATION STUDY
NAFED
National Agricultural Cooperative Marketing Federation of India Ltd.
(NAFED) was established on the auspicious day of Gandhi Jayanti on 2nd October
1958. Nafed is registered under the Multi State Co-operative Societies Act. Nafed was
setup with the object to promote Co-operative marketing of Agricultural Produce to
benefit the farmers. Agricultural farmers are the main members of Nafed, who have
the authority to say in the form of members of the General Body in the working of
Nafed.
Objectives
To facilitate, coordinate and promote the marketing and trading activities of the
cooperative institutions in agricultural and other commodities, articles and
goods
To undertake or promote on its own or on behalf of its member Institutions or
the Government or Government Organizations, Inter-State and international
trade and commerce and undertake, wherever necessary, sale, purchase, import,
export and distribution of agricultural commodities, horticultural and forest
produce, other articles and goods from various sources for pursuing its business
activities and to act as the agency for canalization of export and import and
interstate trade of agricultural and other commodities or articles under any
scheme formulated by the Government of India or other Government agencies
and to facilitate these activities, wherever necessary, to open branches/sub-
offices and appoint agents at any place within the country or abroad;
To undertake purchase, sale and supply of agricultural products, marketing and
processing requisites, such as manure, seeds, fertiliser, agricultural implements
and machinery, packing machinery, construction requisites, processing
machinery for agricultural commodities, forest produce, dairy, wool and other
animal products;
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ORGANISATION STUDY
To act as warehouseman under the Warehousing Act and own and construct its
own go downs and cold storages;
To act as agent of any Government agency or cooperative institution, for the
purchase, sale, storage and distribution of agricultural, horticultural, forest and
animal husbandry produce, wool, agricultural requisites and other consumer
goods;
To act as insurance agent and to undertake all such work which is incidental to
the same;
to act as insurance agent and to undertake all such work which is incidental to
the same;
To organise consultancy work in various fields for the benefit of the
cooperative institutions in general and for its members in particular;
To undertake manufacture of agricultural machinery and implements,
processing, packing, etc. and other production requisites and consumer articles
by setting up manufacturing units either directly or in collaboration or as a
joint venture with any other agency, including import and distribution of
spare-parts and components to up-keep of the machinery/implements;
To set up storage units for storing various commodities and goods, by itself or
in collaboration with any other agency in India or abroad;
To maintain transport units of its own or in collaboration with any other
organisation in India or abroad for movement of goods on land, sea, air etc.;
7
ORGANISATION STUDY
COMPANY PROFILE
KERAFED is the Apex Co-operative Federation of coconut farmers in
Kerala and is the largest producer of coconut oil in India. KERAFED's
coconut oil complex at Karunagapally in Kollam district is one of the biggest
such units in India, with a capacity of 200 Tons per day.
"KERA" Brand of coconut oil is produced by kerafed from copra of the
finest quality, directly procured from coconut growers in Kerala - the land of
coconuts. The copra thus procured is processed using the most modern
technology. In the selection and processing of copra, KERAFED employs
strict quality control measures to ensure product superiority and purity. A
unique two stage filtering process is employed by KERAFED to retain the
original aroma and flavour of coconut oil for a long period.
"KERA" Brand of coconut oil is known for its quality, purity, longer shelf
life and reasonable price. Its quality is conformity with the grade
specifications laid down by the Bureau of Indian Standards vide IS:542-
1968. Certificate of Authorisation to grade "KERA" coconut oil under
AGMARK has also been obtained. "KERA" is available in HDPE bottles of
100 ml, 200 ml and 500 ml; PET bottles of 1000 ml and polythene pouches
of 500 ml and 1000 ml. The raw materials used for these packings are of
virgin / food grade, approved by CFTRI, Mysore / other Government
approved agencies. Secondary packing is done using 3/5 ply corrugated
cartons, as per specification
8
ORGANISATION STUDY
VISION AND MISSION OF KERAFED
MOTTO
To get the support of coconut farmers.
Distributing and providing healthy coconut oil to consumers
VISION
Being the leader of best quality coconut oil it has a vision to provide best
value to the coconut farmers healthy oil to the consumers
MISSION
Business
Customer relation
Innovation
Social sector
OBJECTIVES OF KERAFED
To reduce edible oil imports.
To provide an impulse effect on internal production of coconut.
To develop the agricultural potential of Kerala state.
To strengthen the co-operative movement.
To secure the marketing of coconut and its by-products, thereby assuring
economic prices to the growers.
To undertake research and development activities on production, processing
and marketing.
For effectively and efficiently carrying out the administrative and
operational practices on a day to day basis, the state is divided in to three regions, the
central region, the northern region, and southern region. The southern region consist
of the revenue districts – Thiruvnanthapuram, Kollam, Pathanamthitta, and Alapuzha,
9
ORGANISATION STUDY
the northern region consists of Malapuram, Kozhikode, Waynad, Kannur and
Kasargode districts and the central region consists of Kottayam, Idukki, Ernakulam,
Thrissur, Palaghat districts, 3300 primary agriculture credit societies in each region
are members of the federation to undertake production procurement, marketing
activities at the farmer’s level.
FARMER FRIENDLY ORGANIZATION
Kerafed has been offering farmers attractive support prices for coconut and copra
during unfavorable market conditions, procuring copra under the price
support scheme on behalf of NAFED, Government of India and rendering value
added services to enhance their earnings through improved productivity, and
by assisting them in production and procurement. Kerafed also provide periodic
extension activities to help farmer like
demonstration farms, training camps, exhibitions, seminars and publication and
distribution of bulletins and literature on coconut farming.
10
ORGANISATION STUDY
PRODUCT PROFILE
11
MEMBERS OF THE FEDERATION
1 GOVERNMENT OF
KERALA
1
2 KERALA STATE
COOPERATIVE
AGRICULTURAL
1
3 KERALA STATE
COOPERATIVE
AGRICULTURAL
DEVELOPMENT BANK
LTD
1
4 DISTRICT COOPERATIVE
BANK LTD
9
5 PRIMARY COOPERATIVE
AGRICULTURAL BANK
25
6 PRIMARY
AGRICULTURAL
COOPERATIVE CREDIT
SOCIETIES
900
7 MARKETING SOCIETIES 4
ORGANISATION STUDY
“KERA” Brand of coconut oil is KERAFED from copra of the finest
directly procured from coconut growers in Kerala – “the land of coconuts”. The copra
thus procured is processed using the most modern technology. In the selection and
processing copra, KERAFED employs strict quality measures to ensure product
superiority and purity. A unique two stage filtering process is employed by
KERAFED to retain the original flavor of coconut oil for a long period.
KERA" Brand of coconut oil is known for its quality, purity, longer
shelf life and reasonable price. Its quality is conformity with the grade specifications
laid down by the Bureau of Indian Standards vide IS:542-1968. Certificate of
Authorization to grade "KERA" coconut oil under AGMARK has also been obtained.
"KERA" is available in HDPE bottles of 100 ml, 200 ml and 500 ml; PET bottles of
1000 ml and polythene pouches of 500 ml and 1000 ml. The raw materials used for
these pickings are of virgin / food grade, approved by CFTRI, Mysore / other
Government approved agencies. Secondary packing is done using 3/5 ply corrugated
cartons, as per specifications.
Apart from meeting the marketing needs in Kerala, Tamil Nadu,
Karnataka, and Andra Pradesh etc, they are planning to popularize the brand in cities
like New Delhi, Bangalore, Mumbai, and Kolkata. KERA has gone globally with
export to Middle East countries. KERAFED had tie up with a leading retail chain in
Dubai and Abu Dhabi for the two brands, cooking oil ‘kera’ and hair oil ‘kera kesh’.
KERA is proud to be patronized by millions as the tastiest of all
cooking mediums and the smell of yore, KERA enjoys an undisputed popularity of
the market share in kerala –a feat achieved by ultimate customer satisfaction.
Kerafed at a glimpse:
Integrated development of coconut and coconut products.
Copra selection as per BIS parameters for processing
Most sophisticated processing facilities
Quality control laboratory with AGMARK guarantee.
By far the largest coconut oil mill in India
12
ORGANISATION STUDY
Storage capacity of 2100 tons per day
A predominant share of the market in Kerala is enjoyed by
Kera, the year at economical rates.
Safeguards the interests of over 29 lakhs coconut farmers in
Kerala.
PRODUCTS
The various products of the KERAFED are as follows:
KERA
It is the brand name of the coconut oil produced by Kerafed from copra of
finest quality, direct produced from coconut growers. Copra is produced by the use of
most modern technology. Double filtering process is used by Kerafed to retain its
quality and flavor of coconut oil for a long period.
KERA KESH
In addition to production of edible coconut oil, the production and sale of
ayurvedic hair oil manufactured by Kerafed. This is available in 100ml pack.
KERA GOLD
This is an export quality of kerafed. The export is mainly to the gulf
countries. It is available in 500ml, 200ml, and 100ml pack.
KERA POPULAR & AGMARK
There are two important product of kerafed. KERA AGMARK can be getting
in one litter pack and KERA POPULAR is available in 5kg, 500ml, 100ml, and
pouches.
COPRA CAKE
13
ORGANISATION STUDY
This is the cake from the oil extraction process. The sale of cake is made to
a person who quotes highest price. This is sold in sacks bags.
Top ten coconut producers — 19 December 2009
Country Production (tonnes)
Philippines 19,500,000
Indonesia 15,319,500
India 10,894,000
Brazil 2,759,044
Sri Lanka 2,200,000
Thailand 1,721,640
Mexico 1,246,400
Vietnam 1,086,000
Papua New Guinea 677,000
Malaysia 555,120
Tanzania 370,000
ORGANIZATION CHAR ORGANIZATION CHART
14
ORGANISATION STUDY
15
MANAGING DIRECTOR
ADMINISTRATIVE OFFICER
DIRECTOR (PROJECTS) DIRECTOR
(ADMNISTRATIONS)DIRECTOR
(MARKETING)
DIRECTOR (PRODUCTION)
PROJECT MANAGER
PLANT MANAGER
MANAGER (ADMN)
MANAGER (FINANCE)
MANAGER
ASSISTANT MANAGER
ASSISTANT MANAGER
ASSISTANT MANAGER
ASSISTANT MANAGER
ANALYST OFFICE MANAGER
OFFICE MANAGER
SHIFT IN CHARGE
ACCOUNTANTASSISTANTOPERATORWORKERS
TYPIST TYPIST
ASSISTANT
OFFICE MANAGER
ASSISTANT MANAGER
ATTENDER
ATTENDER
ATTENDER
ORGANISATION STUDY
CHAPTER-3
DEPARTMENT ANALYSES
ORGANISATION STRUCTURE:
Organization structure is the systematic arrangement of the people
working for the organization to achieve preferred goals. The structure has two
dimensions, -horizontal and vertical. The horizontal dimension indicates the
departments and vertical dimensions indicate hierarchy.
Board of management elected by members of the federation is headed by a chairman.
From those members an executive committee and a chairman are elected. The
federation has to get the approval from the board before implementing major decision.
Managing director appointed by the government of Kerala is the supreme authority of
the federation, normally an outside person. Director is the top of the organization
hierarchy among the employees of the organization.
THE DEPARTMENTS IN KERAFED ARE:
1. Administrative department
2. Finance department
3. Marketing department
4. Production department
16
ORGANISATION STUDY
ADMINISTRATIVE DEPARTMENT
In KERAFED, administrative department is responsible for general and personnel
administration officer is the head of the department. Administration involves the
formulation of overall policies and objectives. In KERAFED the administrative
department is just like H.R department commonly seen in other organization.
The functions of administrative department include:
Personal and general administration
Keeping and measuring the confidential report of each employee for the
purpose s like promo9tion, fringe benefits, training etc
To maintaining the relationship with workers and organization.
Administrative function includes attendance, monitoring, recording, and
controlling absenteeism etc.
Other functions like providing canteen services, ESL, provident fund accident
benefits.
To provide better work atmosphere to the employees.
RECRUITMENT
To search for prospective employees and stimulating them to apply for job in
the organization. Recruitment aims to develop and maintain adequate manpower
resource upon which an organization can depend.
Employees are recruited through:-
1. The Kerala state public service commission
2. By deputation from other department
3. Through direct recruitment by the board.
4. On contract basis.
The main source of recruitment and selection of employees in the
organization is Kerala public service commission (KPSE). The present employee
17
ORGANISATION STUDY
strength is 242 (includes permanent and casual workers). At present kerafed have 87
permanent workers, 5 deputationists, and one contract labor. In addition to this 16
persons are engaged on daily waged basis and 149 persons are employed as casual
workers in karunagapally other plants.
TRAINING AND DEVELOPMENT
They provide good training facility for their workers. They also provide computer
training facility for their staffs and employees. Training is the systematic programme
of the organization which aims at increasing the attitudes, skills and abilities of the
workers to perform a particular job. Developments are concerned with growth of
employees in all respects.
EMPLOYEE COMPENSATION
KERAFED employee compensation structure contains:
1. Special allowances
2. House allowances
3. Dearness allowances
4. Basic salary
Medical scheme is also available for the workers and gratuity is
given in collaboration with LIC, in addition to this plan workers and staffs are getting
one day leave as compensation and ESI.
18
ORGANISATION STUDY
TRADE UNIONS
Trade unions are voluntary organization of employers and employees
formed to protect and promote their interests through collective action. Their presence
is felt in all activities of an organization.
In KERAFED there are two trade unions for employees:
1. Kerafed staff association.
2. Kerafed employee’s organization.
Trade unions such as CITU, AITUC, INTUC, BMS etc are function in KERAFEDs
plants.
FINANCE DEPARTMENT
Finance is the foundation stone of every business in the present day set up.
The success of every business depends upon adequate source of finance. Hence the
statement “Finance is the life blood of any business enterprise in every walk of life”.
So in any organization the most important department is finance department.
A well managed financial or working capitals are to be at vry considerable
extent, determined by its financial policies, both past and present,. Department is the
strength of the business enterprise. In KERAFED finance department is headed by
finance manager responsible for all the business transaction, procurement and
allocation of funds are the, major function of finance department. A firm success and
even survival, its ability and willingness to maintain production and investment is
fixed.
19
ORGANISATION STUDY
FUNCTIONS OF FINANCE DEPARTMENT
The major functions of the finance department are:-
1. Accounting
2. Auditing
- Internal auditing
- Statutory auditing
- Government Auditing
3. Release the payments and collecting receipts from contract with
outsiders.
4. Information management
5. Budgeting
MEMBERSHIP AND SHARE CAPITAL
In the commencement of the year there were 941 members holding 57562
shares worth Rs.287820000/- this includes 55117 share invested by govt of kerala and
NCDC worth Rs.27558500.
BORROWINGS
The amount outstanding at the begening of the year under borrowings from
NCDC and govt of kerala was 258797800/- and the same amount is outstanding at
the end of the year.
20
ORGANISATION STUDY
WORKING CAPITAL
In KERAFED, at the end of the year working capital arrived at Rs.
273461673.72
SOURCE OF FUNDS
The main sources of funds of KERAFED are:-
Share capital contribution of govt of Kerala.
Share capital contribution by cooperative institutions
Loans from NCDC, cooperative banks and govt of Kerala.
Grants and subsidies.
These funds are employed for the procurement of copra, marketing expenses and
administrative expenses etc.
Grant and share capital were the primary elements of the capital structure of
the federation. It includes:
21
ORGANISATION STUDY
The major investment decision requires approval of board of management. If there is
an opportunity for investment, the proposal is put before the board of management. A
committee from the board of management investigates the viability of the project and
their findings are put before the board. The board gives approval for the project, only
if it is found as viable. During the last few years the federation was in loss.
An annual report, prepared by the account section and audited by an
external auditor, is submitted to the registrar of cooperative societies.
The price of the product is prepared on the basis of “mark-up’ pricing
method. A 10% of profit is added per unit cost of the product. From this 10%, 12%
commission is given to the suppliers and retailers.
22
6%5%
20%
60%
Share capital provided by members societiesGovernment contributionNCDC grantEEC grant
CAPITAL
STRUCTURE
PERCENTAGE
EEC Grant 60%
NCDC Grant 20%
Government contributions 5%
Share capital provided by member
societies
5%
ORGANISATION STUDY
For ex: Unit cost of the product is determined by the market price of the copra and the
production and administration expenses. If the price of copra varies, the per unit cost
also varies. Then the price of the product is adjusted according to the marketing price
of the copra.
Normally the suppliers are given a 20 days credit period. The credit period
is as per bank guarantee and the past performance. If the supplier fails to meet the
obligation within the stipulated period, the federation collects the amount from the
bank.
The various sections working with the finance department are:
Budgeting
Commercial accounts
Bill passing
Cash
Works
One of the primary functions of finance department is maintaining the
books of accounts, in this process extensive use of computers are employed for the
purpose of feasibility and accuracy. The trial balance is prepared on this basis of the
various ledger folios and other transaction details and then profit and loss account and
balance sheet is prepared based on trial balance.
Budgeting
Budgeting is one of the other vital activities undertaken by the
department. The budgeting process involves prediction of future sales and the
preparation of estimates based on that sales. Dates such as future sales are
provided by the marketing department on the basis of past sales details and
current market conditions. The future production, labor, cash, and other
resource requirements are defined in the budget.
Commercial accountants
23
ORGANISATION STUDY
The process of internal auditing is conducted by cooperative wing
auditor assisted by the finance department and statutory audit by an professional
charted accounted. The finance department of Kerafed conducts inspection of
concerned transaction details of primary cooperative societies.
Cash section
Salaries and wages of the employees are prepared in this section. The
cash section deals with the payment and receipt of cash. The payment
exceeding Rs. 20000 will be in cheques.
MARKETING DEPARTMET
Marketing is the wide range of activities involved in making sure that the
company is continuing to meet the needs of their customers and are getting
appropriate value in return. It is concerned with promoting the company’s
product and services in the market for achieving maximum sales. KERAFED
has an aggressive marketing strategy. In an resent survey the brand KERA has
bagged second position in Kerala after milma. So the company is not investing
much in promoting their product.
The marketing department consists of a manager, below
him comes the assistant manager, senior assistant and assistant, below him
comes the assistant manager, senior assistant and assistant, below him comes
typist and attender.
Advertising campaign was handled by STRAK
communications Trivandrum. The federation has reduced the quantum of
advertisement. Television and print media is the main media to communicate
with the customers. And now a day they are more concentrating on exhibition
s as promotion. In most of the triveni and supplyco stores KERA coconut oil is
selling like a hot cake because all people are buying product from these stores
at less costs during the festival seasons like Onam, Ramzan etc.
KERA has a good distribution channel, reaching each and
every taluk in Kerala. With most extensive procurement channels, most
24
ORGANISATION STUDY
modern processing facilities and a massive storage capacity of 2100 tones with
stock points in prominent cities in Kerala helps the federation to ensure
availability of KERA to each and every consumers.
KERA is currently part of the biggest retail network-
CSD, ministry of defence, oil seed cooperation like Karnataka oil federation;
Tamil Nadu cooperative growers federation (TANCOF) and oil federation of
Madhya Pradesh will soon be complimenting the already existing marketing
and sales channels of a KERA, in their respective states.
The sales turnover of KERA brand coconut oil is marked
a steady increase during the past few years. In order to increase the sales
turnover the federation has decided to convert Mobile team officers in to field
offices and posted permanent staff instead of personnel on contracts and
deputation. Because of these change a steady progress is seen in both in the
procurement of copra as well as sale of Kera oil.
Functions of Marketing Department
To find new markets.
Deciding pricing strategies
Strengthening the agency network
Appointment of agencies
Forecasting the demand
Creating awareness
Collection of payments
Grievance redressal of customers
Keeping the relevant information and exchanging with other department
Objectives of Marketing Department
The main objectives of marketing department in KERAFED are:
25
ORGANISATION STUDY
Selection and appointment of stockiest/direct sales customers
and others.
Price fixation of sales commission and overall sales policy
including market budget.
Order evaluation and acceptance of order registers, priority,
booking registers, dispatch registers etc.
To increase sales there are some marketing techniques adopted, mainly the 4p’s are
used to furnish their business. They are:
Price
Price is the money customers have to pay to obtain the product.
Price mainly involves decisions regarding base price, discount price, discount
allowances, freight payment, credit etc. pricing effect many factors including
employees, share holders, competitors and the public at large.
Place (distribution)
KERAFED’s products are distributed through various outlets; include
both private and public institutions. KERAFED is noted for its goods procurement
channel, better processing facilities and for a very big storage capacity. It has its stock
point in prominent cities, which help the organization to ensure availability of
KERAFED’s product to the customers. KERA has made its presents in felt in states
like Madhya Pradesh, Tamil Nadu, Andhra Pradesh and Karnataka also. KERAFED
had tie up with a leading retail chain in Dubai and Abu Dhabi for the two brands,
cooking oil ‘Kera’ and hair oil ‘Kera Kesh’.
Promotion
Sales promotion is an important and specialized function of
marketing department. Promotion covers advertising, personal selling and sales
promotion. Advertisement of Kerafed products are mainly done through media and
26
ORGANISATION STUDY
such type of things are done by star communication. Television and print media is the
main media to communicate with the customers. And now a day they are more
concentrating on exhibition s as promotion.
Sales volume of KERAFED
KERAFED continuous to play a dominant role as cooking oil in
the Kerala market. Between 400 and 600 tones of Kera coconut cooking oil was sold
in Kerala in pouches, every month. Kerafed expects to sell about 20 tones of coconut
cooking oil in the gulf market every month. Sales keep on creating records during
every onam seasons.
Kera sales volume
1 LITTER 75%
500ml 20%
100ml and others 5%
Competitors
The main competitors of KERAFED in the state are:
KPL
SUDHI
THEJAS
KLF NIRMAL
Parachute is the main market leader in the Indian branded coconut oil industry. The
main players in the Indian market are SHALIMAR, COCO CARE, TATA products
etc.
27
ORGANISATION STUDY
PRODUCTION DEPARTMENT
The production department function of KERAFED is to produce the
product according to the demand. Production department undertakes the process of
transformation of copra into oil and oil cake. A series of processing is used to convert
copra into oil. The machines and equipments in kerafed installed is in straight line
basis. KERAFED has two production units, KERAFED oil complex in Karunagapalli
and KERAFED coconut complex at Naduvannur, Calicut. The capacity of the plan is
200MTPD (Metric tons per day).
Plan manager is the head of units and the plant has two main
functional areas –production and quality control.
The two major commercial products derived from coconut are coconut
oil and copra. Copra is dried meat(endosperm) of the coconut and oil is extracted
from it through a mechanical process. Copra making is a systematic process through
which the fresh meat of coconut containing 50-55 percent moisture is dried either in
sunlight or using other sources of energy, to bring down the moisture content to 5-6
percent.
Functions of production department
The production department in Kerafed has many important
functions, which are as follows:
To prepare detailed production plans consistent with
companies production objectives
To receiving raw material and packing final product
To take the corrective actions from the point of the quality
assurance to the customers.
To ensures implementation of safety measures in the
preparation of equipments and process to avoid dangers to
the structures, equipments and men.
28
ORGANISATION STUDY
The production department of Kerafed has the following three divisions.
Storage division
Manufacturing division
Packing and filling unit
Hierarchy of production plant
Storage division
The storage capacity of go down is 6000tonnes. The godown
section is headed by an officer in charge whose office is situated inside the go down.
He maintains the record presenting the intake of copra and also transfer of copra to
the manufacturing division.
Manufacturing Division
The manufacturing unit is headed by a technical officer whose
cabin is situated within the manufacturing unit. The production plan of the units
depends on the market demand of the product. It depends or varies on the festival
seasons. More products are required during the festival seasons especially during
Onam.
The machines that are used in extracting the oil are:
1) Conveyor systems used for copra loading
2) Copra cutting cutter for slicing copra
3) Boiler system for heating copra
4) Expellers for copra crushing
5) Filters for oil filtering
6) Tanks for oil storage
7) Packaging
29
ORGANISATION STUDY
Production process
In the manufacturing unit dried copra is received through the
conveyors and is directly passed through a cutting machine and their it goes for
crushing. After crushing, the copra is converted into small pieces which are required
for extraction. These small pieces are transferred to the expellers by small passages
consisting of crushed blades and gates. The crusher blades cut the pieces of copra into
smaller pieces before being fed into expellers. The purpose of gates is to check the
flow of unwanted substances into expellers. The crush copra is then put into the
expellers and first extract oil, second extracted oil is then passed on to the first filter
and then second filter. This process of double filtration provides pure and high quality
oil. This oil is then passed on to the storage tanks through pipelines and the oil is
stored in the bulk for sediments in order to get clear oil for one week. After one week
it is used for packing and filling. The oil cake obtained as by-product will find a ready
market as cattle feed and in the manufacture of mixed cattle feeds.
Packing and filling unit
Packing and filling unit is highly mechanized and here oil is usually
packed in different packs i.e., from 6ml sachets to 15kg tins. As per the demand the
packing division takes oil from the storage tanks and uses it for filling into sachets,
pouches and bottles.
This section is headed my a separate officer, shift in charge whose
cabin is located inside the packing unit. Bottle filling line in the plant can
automatically fill and seal bottles. Quality check process in this unit is undertaken
under two levels, increases of the oil quality and also the quality of the packing
material. Before any oil is used for packing the quality control lab technically checks
that the lots of oil on the basis of specified guidelines due approved, the process of
packing is undertaken. The price of the product varies frequently and on that basis the
machine is adjusted to print the existing price
30
ORGANISATION STUDY
Coconut oil sale
Sale of Kera coconut oil
Year 2005-
2006
2006-
2007
2007-
2008
2008-
2009
2009-
2010
2010-2011
(up to 31-12-
2010)
Kera coconut oil
sold
4768 5655 7359 9957 10310 10202
31
ORGANISATION STUDY
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
0
2000
4000
6000
8000
10000
12000
Kera coconut oil sold
Kera coconut oil sold
TURNOVER
TURNOVER (Rs.Lakhs)
2005-2006 3726.45
2006-2007 4790.41
2007-2008 6448.34
2008-2009 8004.78
2009-2010 19160.37
32
ORGANISATION STUDY
2010-2011(up to31-12-2010) 11346.58
2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110
5000
10000
15000
20000
25000
Turnover
Turnover
Zone wise sales of Kera oil in Kerala during 2010-2011(up to 31-12-2010)in M tones
Zone wise sales of Kera oil in Kerala
during 2010-2011(up to 31-12-2010)in M tones
South Zone 6019
Central Zone 2368
33
ORGANISATION STUDY
North Zone 1714
Total 10101
Sales
South zoneCentral zoneNorth zone
Trade Profit (Lakhs)
year (Rs.Lakhs)
2005-2006 -457.90
2006-2007 266.78
2007-2008 550.41
2008-2009 637.67
34
ORGANISATION STUDY
2009-2010 1094.38
2010-2011(up to 31-12-2010) 907.27
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
-600
-400
-200
0
200
400
600
800
1000
1200
Trade Profit
Trade Profit
QUALITY
In manufacturing, a measure of excellence or a state of being free
from defects, deficiencies, and significant variations, brought about by the strict
and consistent adherence to measurable and verifiable standards to
achieve uniformity of output that satisfies specific customer
or user requirements. ISO 8402-1986 standard defines quality as "the totality
of features and characteristics of a product or service that bears its ability to satisfy
stated or implied needs."
35
ORGANISATION STUDY
QUALITY CONTROL
Quality control, or QC for short, is a process by which entities review the quality of
all factors involved in production. This approach places an emphasis on three aspects:
1. Elements such as controls, job management, defined and well managed
processes, performance and integrity criteria, and identification of records
2. Competence, such as knowledge, skills, experience, and qualifications
3. Soft elements, such as personnel integrity, confidence, organizational
culture, motivation, team spirit, and quality relationships.
The quality of the outputs is at risk if any of these three aspects is deficient in any
way.
Quality control emphasizes testing of products to uncover defects and reporting to
management who make the decision to allow or deny product release, whereas quality
assurance attempts to improve and stabilize production (and associated processes) to
avoid, or at least minimize, issues which led to the defect(s) in the first place. For
contract work, particularly work awarded by government agencies, quality control
issues are among the top reasons for not renewing a contract.
QUALITY CONTROL DEPARTMENT
The organization quality control laboratory meet Agmark
parameters confirm the purity of kera. A unique two stage filtering process is
employed by kerafed to retain the original aroma and flavors of coconut oil for a long
period
Copra with moisture content below6% is normally. Accepted for
processing in KERAFED. Once the quality report is ready from section, the material
36
ORGANISATION STUDY
receipt and service and service request prepared by the procurement section is given
to Account section for the approval of the cost of material and then passed by plant
manager
Copra procurement by KERAFED
Copra Procurement
year (Rs.Lakhs)
2005-2006 7671
2006-2007 9502
37
ORGANISATION STUDY
2007-2008 10890
2008-2009 16379
2009-2010 11038
2010-2011(up to 31-12-2010)
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
Copra procurement
Copra procurement
Copra crushing
2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011
(up to 31-12)
Karunagapally 5203 5666 7272 9885 12074 11718
Naduvanoor 2886 3660 3756 5081 4620 4169
Total 8089 9326 11028 14966 16694 15887
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ORGANISATION STUDY
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
0
2000
4000
6000
8000
10000
12000
14000
KarunagapallyNaduvanoor
Production of coconut oil
2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011
(up to 31-12)
Karunagapally 3329 3618 4656 6330 7706 7504
Naduvanoor 1847 2359 2422 3277 2980 2693
Total 5076 5977 7078 9607 10686 10197
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ORGANISATION STUDY
Production of CN oil cake
2005-2006 2006--2007 2007-2008 2008-2009 2009-2010 2010-2011
(up to 31-12)
Karunagapally 1731 1829 2360 3213 3986 3761
Naduvanoor 891 1147 1182 1620 1480 1350
Total 2622 2976 3542 4833 5466 5111
40
2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110
1000
2000
3000
4000
5000
6000
7000
8000
KarunagapallyNaduvanoor
ORGANISATION STUDY
MANUFACTURING UNIT
41
EXPELLER I
GATE
CRUSHER
PASSAGE
CRUSHING UNIT
2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-20110
500
1000
1500
2000
2500
3000
3500
4000
KarunagapallyNaduvanoor
ORGANISATION STUDY
QUALITY CONTROL PROCESS CHART
42
PRIMARY CO-OPERATIVE SOCIETIES
FIELD OFFICE
FIRST QUALITY CHECK BY SOCIETY
SECOND QUALITY CHECK BY MOBILE TEAM INSPECTOR
ACQUIRING COPRA FROM SOCIETY
PROCUREMENT OF COPRA
FARMERS/COCONUT GROWERS
EXPELLER I
ORGANISATION STUDY
CHAPTER-4
SWOT ANALYSIS
Strength
43
FACTORY
EXTRACTION UNIT
STORAGE
PACKING
SECOND QUALITY CHECK OF STORED OIL
FIRST QUALITY CHECK OF OIL BY FACTORY LAB
THIRD QUALITY CHECK OF COPRA BY FACTORY LAB
FOURTH QUALITY CHECK OF COPRA BY FACTORY LAB
TRANSFER OF COPRA TO FACTORY
COPRA USED FOR EXTRACTION
EXTRACTED OIL SEND FOR
OIL USED IN PACKING UNITS
ORGANISATION STUDY
Most popular brand name ‘KERA’.
The quality of the products is excellent.
Most modern machinery for oil extraction
Plants have adequate production capacity
Strong network of primary co-operative societies in the state
All support from government
Follow a very strict quality control measures
Weakness
Seasonal variation badly affects the procurement of copra
Many times Kerafed is forced to procure copra at a price greater
than the market price, as per the direction of NAFED
Lack of promotional activities
Not utilizing the installed capacity of production units.
Lack of advertisement
Opportunity
Diversification of the product
Advertisement and promotional activities the market can be
expanded to other states
Target of work may be fixed in all sections
Adequate support from NAFED, state government and
cooperative societies
Most modern technology is used here.
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ORGANISATION STUDY
Threat
Unfiltered coconut oil obtained from other states is available in
market at low prices.
There are some arguments that coconut oil as edible oil cause
health problem
Heavy competition from private companies
There are other cooking oils which are available at very cheap
rates.
CHAPTER-5
FINDINGS AND SUGGESTIONS
Findings
KERA has very good brand image.
KERA coconut oil is used for cooking and as hair oil.
Lack of supervision and management.
The inadequate supply of copra adversely affects the function of
the federation.
Rural people prefer more kerafed product.
Not much importance is given on exporting.
45
ORGANISATION STUDY
Lack of raw materials in peak time
Kerafed’s plant at kollam is not functioning at its full capacity
At present advertisement of the kera coconut oil is less compared
to their competitors
Recommendations
More capital should be released for advertising and sales
promotion
Give some more attention to export markets.
Proper and efficient supervision and management is necessary at
oil complex at Karunagapally.
Market can be expanded to all over India as coconut oil contains
health benefits and also used in medicines.
The pricing method of kera should be examined and price should
be renewed periodically.
CHAPTER-6
CONCLUTION
The organization study covers all the theoretical and the practical matters of “The Kerala Kera Karshaka Sahakarana Federation Ltd”, (KERAFED), Thiruvananthapuram. It covers functional analysis, organizational structure, various departments, manufacturing units, and quality control techniques, promotional and marketing activities of KERAFED. Kera has a strong and powerful brand image. But Kerafed don’t try to utilize their maximum production capacity which, it creates some unavailability of their product in the market. If they are willing to utilize their maximum production capacity Kerafed can easily become the No 1 coconut oil producer in the world. And Kerafed should renew their price periodically; it creates
46
ORGANISATION STUDY
more attraction of their product among the customers. Initially KERAFED was formed for the betterment of Kera farmers, but today the company should keep good relationship between the farmers for making better result.
CHAPTER-7
BIBILIOGRAPHY
Annual report of KERAFED,2010
Sahari Gupta.K, Neeti Gupta, Financial management, Kalyani
publications,New Delhi.
Kothari, Research Methodology, A New Age International publication, New
Delhi.
www.kerafed.com
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ORGANISATION STUDY
48