Distribution Network Optimization (International Route)- Jaipur Rugs
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Transcript of Distribution Network Optimization (International Route)- Jaipur Rugs
Jaipur Rugs Logistics Planning
India's largest manufacturer and exporter of hand knotted rugs
Produces an exclusive product range of rugs, pillows and poufs
Carry forward the rich heritage of India to more than 40 countries in the world
Has a network of around 40,000 skilled artisans in rural India
Jaipur Rugs Company Private Ltd.
JR Foundatio
n
JR Incorporate
d
JR Compan
y
Bhoomika Wools
Entities
Headquarter
Carding &
Spinning
Weaving & Finishing
Dyeing & Opening
Production Process Logistics
Bikaner
Jaipur
22 branch offices spread across 7 states
Shipping & Export Documentation Dept.
1 •Customer (large retailer) placed order with JRI
2 •JRI communicated order to JRC.
3 •JRC forecasted and acquired raw materials •Includes wool bought in Bikaner or imported from another country by Bhoomika Wools
Description of Process
4 •JRC completed pre-production logistics •Cleaned, prepared and delivered wool to rug map
5 •Weaving process
6 •Post production logistics•Finished carpet returned to JRC and packed for shipment
7 •Total JRC cost amounts to say ‘X’ $
8 •JRC wholesale price charged to JRI
9 •Shipping cost (Cost/ Sq.Ft= 0.25 $)•Paid by customer
*** Shipping cost is assumed to be through vessel and includes all customs, fees, duties, and final transportation to customer.*** Shipments by air cost $ 1.5/ sq.ft. and are only for back-ordered products (approximately 15% of all shipments).*** JRI pays for the shipment in this case.
10 •JRI wholesale price•Charged by JRI to customer
11 •Final retail price•Charged by customer to end consumer
!!!
Production units are in Rajasthan, Gujarat, Uttar Pradesh, Bihar and Madhya Pradesh; with two new states i.e. Maharashtra and Jharkhand being added up
Annual production of approximately 5 thousand million square feet of Rugs
Provide training and giving fair wages with no exploitation
Connecting artisans to global Market
Manufacturing network
Artisans are Familiar with traditional skills of carpet weaving
Traditional tools, looms and technology is easily available Most of the artisans are from the same caste and status Products are made by the poorest among the poor (ST/SC/
BPL) which helps in creating the brand image Artisans here are mostly mastered the art as they get it
from their ancestors who were in the same business. In addition to this, Grant Support to Jaipur Rugs
Foundation is eligible for tax exemption under Section 35AC and Section 80 G of India's Income Tax Act.
Rationale behind selecting manufacturing locations
At present Jaipur rugs has businesses in more than 30 countries and touched a turnover of over 14 million $ in 2008-09.
USA is the major market of rugs where about 65% of the sales are done.
Followed by Turkey, Canada, Mexico, Italy, Germany, Australia, Russia, Spain, Romania etc.
Distribution Network
Jaipur Rugs Supply Chain Network
Jaipur Rugs distribution network
Transit Time calculation using APL Logistics
Gujarat-based private ports are closer to the industrial regions of Rajasthan and Haryana
In FY12, JNPT operated at nearly 120% of its capacity, whereas Mundra operated at around 60 to 70% of their capacity
Kandla(Port in Gujarat), India’s largest port by volumes, a 30% hike in vessel-related charges is driving traffic elsewhere
The Adani Group, which employs more than 5,000 people in the Kutch district, expects to expand the port’s(Mundra) capacity to 200 million tonnes of cargo per year by 2020 from the current 78 million tonnes
Rationale behind selecting Mundra Port
External Connectivity Mundra SEZ has seamless connectivity through
National Highway (NH 8A Ext.) & State Highway (6 & 48) from Northern and Western parts of India
Internal Connectivity 150 km of arterial and sub-arterial road network
planned within the SEZ of which 70 km already completed
Roads designed as per IRC Standards Codes and Safety Norms
Connectivity Advantage: Road
It’s a network of warehouses, proximity to Atlanta and south eastern consumers, rail and interstate access
It takes 5 hours(535 Km) from Charleston Port to reach to Jaipur rugs, Atlanta office, whereas from savannah it takes only 4 hours(425 Km)
Rationale behind selecting Savannah Port
Source Destination Mode of transport Distance (KM) Time
Jaipur Rugs HQ, Rajasthan
Jaipur ICD (Kanakpura) Road 10.2 1 Hours
Jaipur ICD JNPT Road 1210 17 Hours
JNPT Damietta Sea
8744Nm 27 DaysDamietta New York Sea
New York Charleston port Sea
Charleston Port Jaipur Rugs, HQ, US Road 535 Km 5 Hours
Case 1: Complete Transit time
Complete Transit Time = 27 Days 23 Hours(Excluding Loading/unloading time or any other time lag)
Source Destination Mode of transport Distance (KM) Time
Jaipur Rugs HQ Jaipur ICD (Kanakpura) Road 10.2 1 Hours
Jaipur ICD Mundra Port Road 853 13 Hours 33 mins
Mundra Damietta Sea
- 24 DaysDamietta New York Sea
New York Savannah Sea
Savannah Jaipur Rugs, HQ, US Road 425 Km 4 Hours
Case 2: Complete Transit time
Complete Transit Time = 24 Days 18 hours 33 minutes(Excluding Loading/unloading time or any other time lag)
Thank You