Material mamnagement project report.docx

8/17/2019 Material mamnagement project report.docx

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Material Management

TABLE NO: 5.1

TABLE SHOWING INVENTORY TO NET SALES

INVENTORY TO NET SALES = Inventory

Net Sales∗100

Rs. In

Lakhs

ANALYSIS:

From the above table it can be analyzed that there is a increasing level in

the rate of inventory to net sales is 44.895% during the year 20112012. !here as

there it has been increased to 4".#"% in the year 2012201#. $n the year 201#2014 it increased to 52.28% ho&ever there is increase in the year 20142015 &ith

the52.5"%.

Page 1

Y

EAR

INVENTORY

(RS)NET SALES

PERENTAGE

(!)

"#11$"#1" "%&'#. 5%&".11 &&.*!

"#1"$"#1+ "%'+.# 5%'.'& &'.+'!

"#1+$"#1& +%1*1."* '%1#+." 5"."!

"#1&$"#15 +%"*.1 '%"5.5" 5".5'!


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Material Management

GRAPH NO : 5.1

GRAPH SHOWING INVENTORY TO NET SALES

2011-2012 2012-2013 2013-2014 2014-2015

40.00%

42.00%

44.00%

46.00%

48.00%

50.00%

52.00%

54.00%

44.89%

46.36%

52.28% 52.56%

INTERPRETATION:

From the above gra'h it can be inferred that due to the increase in the demand for !ire

'roducts their has been slight increase in the level of inventory to sales in the year 2014

2015 &hen com'ared to 'revious years.

Page 2


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Material Management

TABLE NO: 5."

TABLE SHOWING INVENTORY TO ,RRENT ASSETS RATIO

INVENTORY RATIO = Inventory

Current Asset ∗100

Rs. -n Lakhs

ANALYSIS:$

From the above table &e can observe that in the year 2012201# there is a

increase in the current asset value &hen com'are to other years but in the other years

also there is a increase in the current asset and inventory.

GRAPH NO : 5."

Page #

YEAR INVENTORY

(Rs)

,RRENT

ASSET(RS)

PERENTAGE

(!)

"#11$"#1" "&'#. '"*"."* +*.11

"#1"$"#1+ "'+. 1"1++." "".#+

"#1+$"#1& +1*1."* 11".&5 "'.*

"#1&$"#15 +"*.1 11**1.'" ".5


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Material Management

GRAPH SHOWING INVENTORY TO ,RRENT ASSETS RATIO

2011-2012 2012-2013 2013-2014 2014-201545

46

47

48

49

50

51

49.18

47.43

50.47

46.92

INTERPRETATION:$

From the above gra'h it can be inferred that there is a more increase in the value of ra&

materials due to more 'urchases during the year 20142015. (o &hy there is more

increase in the values of current assets and inventory during the year 20142015 &hen

com'ared to other years.

TABLE NO:5.+

Page 4


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Material Management

TABLE SHOWING INVENTORY TO TOTAL ASSETS RATIO

INVENTORY TO TOTAL ASSETS RATIO = Inventory

Total Inventory∗100

Rs

.-n

Lakhs

ANALYSIS:$

)he above table sho&s that there is increase in the total assets due to increase

in the current assets. $n the year 20112012 the total assets &ere less &hen

com'ared to 20142015 and the 'ercentage has been decreased in the year 2014

2015.

GRAPH NO:5.+

Page 5

YEAR INVENTORY(

RS)

TOTAL

ASSETS(RS)

PERENTAGE(

!)

"#11$"#1" "&'#. 5##+ &*.1

"#1"$"#1+ "'+. 5'+'.*' &.&+

"#1+$"#1& +1*1."* '+"".' 5#.&

"#1&$"#15 +"*.1 #"*.5 &'.*"


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Material Management

GRAPH SHOWING INVENTORY TO TOTAL ASSETS RATIO

2011-2012 2012-2013 2013-2014 2014-201545

46

47

48

49

50

51

49.18

47.43

50.47

46.92

INTERPRETATION:$

From the above gra'h it can be inferred that there is increase in both

inventory and the total assets during the year 20142015 and 'ercentage &ise it is

decreased &hen com'ared to 'revious years because there is increase in both the

inventory and the total assets during the year 20142015.

TABLE NO:5.&

Page "


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Material Management

TABLE SHOWING INVENTORY TO WORING APITAL

INVENTORY TO WORING APITAL RATIO = Inventory

Working Capital∗100

Rs. In Lakhs

YEAR INVENTORY

(RS)

WORING

APITAL

PERENTAGE

(!)

"#11$"#1" "&'#. $1+&."+ $1.+

"#1"$"#1+ "'+. +5##.' #.'

"#1+$"#1& +1*1."* &&"1.+5 #."

"#1&$"#15 +"*.1 5#*+.' #.'5

ANALYSIS:$

From the above table it is clear that there is a negative value in the &or*ing

ca'ital ratio during the year 20112012 due to the increase in the current

liabilities+,s -"#9.52a*hs and the current assets +"292.29a*hs. (o &hy the

&or*ing ca'ital is having the negative value.

GRAPH NO:5.&

Page -


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Material Management

GRAPH SHOWING INVENTORY TO WORING APITAL.

2011-2012 2012-2013 2013-2014 2014-2015

-2

-1.5

-1

-0.5

0

0.5

1

-1.83

0.76 0.72 0.65

INTERPRETATION:

From the above gra'h it can be inferred that due to increase in the current

liabilities value due to this slight changes in the level of inventory of a

com'any during the year 20142015 so &hy there is a slight variations in the

&or*ing ca'ital.

TABLE NO:5.5

Page 8


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Material Management

TABLE SHOWING ANN,AL ONS,/PTION O0 RAW

/ATERIALS

Rs.-n Lakhs

ANALYSIS:$

From the above table it is clear that the annual consum'tion of ra&

material has been increased in the year 201#2014 &hen com'ared to other 'revious

years but there is a decrease in the values of annual consum'tion of ra& materials during

the year 20142015.

GRAPH NO:5.5

GRAPH SHOWING ONS,/PTION O0 RAW /ATERIAL

Page 9

YEAR

ANN,AL

ONS,/PTION O0

R/(IN LAHS)

"#11$"#1" "1"+.#

"#1"$"#1+ +#".

"#1+$"#1& +"&.'

"#1&$"#15 +1+*.5+


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Material Management

.

2011-2012 2012-2013 2013-2014 2014-2015

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2123.08

3072.8

3824.67

3139.53

INTERPRETATION:$

From the above gra'h it can be inferred that there is more annual

consum'tion of ra& materials in the year 201#2014 may be due to a more 'roduction

and more demand to a 'roduct and there is a increase in the consum'tion of ra&

materials year by year.

TABLE NO:5.'

TABLE SHOWING THE STO O0 WOR IN PROGRESS.

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Material Management

ANALYSIS/

)he above table indicates

the stoc* of &or* in 'rogress

the stoc* has been increased in

the !$ from the year on year

there is a more increase in

the year 20142015 i.e.. ,s. 19".8" a*hs.

GRAPH NO:5.'

GRAPH SHOWING STO O0 WOR IN PROGRESS

Page 11

YEAR WOR IN PROGERSS(IN

LAHS)

"#11$"#1" 5.**

"#1"$"#1+ 11+.5'

"#1+$"#1& 1'1.&"

"#1&$"#15 1*'.'


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Material Management

2011-2012 2012-2013 2013-2014 2014-2015

0

50

100

150

200

250

58.99

113.56

161.42

196.86

INTERPRETATION:$

From the above gra'h it can be inferred that during the year 2014

2015 there is more increase in the value because the orders during this year is more &hen

com'ared to other years.

TABLE NO: 5.

TABLE SHOWING INVENTORY ONVERSION PERIO2.

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Material Management

In3en467 8n3e6s-n 9e6- = No of days∈a year

Stock turnover ratio .

.

ANALYSIS:$

From the above table it is clear that the stoc* turnover ratio has been

decreased from 20142015 &hen com'ared to other years but there is a increase in the

inventory conversion 'eriod during the year 20142015.

GRAPH NO: 5.

GRAPH SHOWING INVENTORY ONVERSION PERIO2.

Page 1#

YEAR NO O0 2AYS

IN A YEAR

STO

T,RNOVER

RATIO

INVENTORY

ONVERSION

PERIO2 (2AYS)

"#11$"#1" +'5 ".1* 1'

"#1"$"#1+ +'5 "."5 1'"

"#1+$"#1& +'5 ".# 15

"#1&$"#15 +'5 1.*+ 1*


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Material Management

2011-2012 2012-2013 2013-2014 2014-2015

1.7

1.8

1.9

2

2.1

2.2

2.3

2.19

2.25

2.08

1.93

INTERPRETATION:

From the above gra'h it can be inferred that there is a

decrease in the stoc* turnover ratio due to increase in the average stoc* and the cost of

goods sold during the year 20142015 )here is a increase in the inventory conversion

'eriod due to decrease in the stoc* turnover ratio during the year 20142015.

TABLE NO:5.

TABLE SHOWING AVERAGE STO O0 RAW /ATERIAL.

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Material Management

A3e6age s48k ; 6a< a4e6-a> =

Opening Stock of Raw material+Closing Stock of Raw material

2

Rs.-n Lakhs

YEAR OS O0 RAW

/ATERIAL

S O0

RAW

/ATERIAL

AVERAGE

STO O0

RAW

/ATERIAL

"#11$"#1" +#"&.5& +1+5. +##.15

"#1"$"#1+ +1+5. +''*.#+ +".&

"#1+$"#1& +''*.#+ &.*+ +'.*

"#1&$"#15 +5+.5' +5+.5' +5+.5'

ANALYSIS:$

From the above table it can be analyzed that the average stoc* of ra&

material in the year 20112012 &as #080.15 2012201# &as #402.4 201#2014 &as

#8-".98 and in the year 20142015 &as #58#.5".)his sho&s the increasing trend of

average stoc* of ra& material.

GRAPH NO:5.

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Material Management

GRAPH SHOWING AVERAGE STO O0 RAW /ATERIAL

2011-2012 2012-2013 2013-2014 2014-20150

500

1000

1500

2000

2500

3000

3500

4000

4500

3080.153402.4

3876.98

3583.56

INTERPRETATION:

From the above gra'h it can inferred that there is no drastic changes in the average stoc*

&hen com'are to 'revious year 201#2014. )he com'any has maintained consistency in

'urchase of ra& material during the year 20142015.

TABLE NO: 5.*

Page 1"


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Material Management

TABLE SHOWING ,RRENT RATIO

Rs. In Lakhs

YEAR ,RRENT

ASSETS

,RRENT

LIABILITIES

,RRENT

RATIO

"#11$"#1" '%"*"."* %'+*.5" #."

"#1"$"#1+ 1"%1++.+1 %'+".' 1.&

"#1+$"#1& 11%".&5 %.1# 1.5*

"#1&$"#15 11%**1.'" '%*.*& 1.&

ANALYSIS:

From the above table it is clear that the current assets are more &hen com'are to current

liabilities ece't in the year 20112012 but there is a increase in the current assets and

current liabilities and also the current ratio during the year 20142015.

GRAPH NO:5.*

Page 1-


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Material Management

GRAPH SHOWING ,RRENT RATIO

2011-2012 2012-2013 2013-2014 2014-20150

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

0.82

1.41.59

1.74

INTERPRETATION:

From the above gra'h it can be inferred that there is a slight increase in the year 2014

2015 &hich indicates good liuidity 'osition of the business in the year 20142015.

TABLE NO:5.1#

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Material Management

TABLE SHOWING 2EBTOR?S T,RNOVER RATIO

26?s 4@6n3e6 6a4-= Net annualsales

AverageDebtors

A3e6age 26?s =Opening Debtors+Closing Debtors

2

Rs. In Lakhs

YEAR

NET

ANN,AL

SALES

AVERAGE

2R?S

2R?S

T,RNOVER

RATIO

"#11$"#1" 5%&".11 "5+5. ".1'

"#1"$"#1+ 5%'.'& "%*5.1# ".#'

"#1+$"#1& '%1#+." +#1#.1 ".#"

"#1&$"#15 '%"5.5" ++1.' 1.'

ANALYSIS:

From the above table it can be analyzed that there is a increase in the year on year and

also the average 3rs has been increased in the year 20142015 but the 3rs turnover

ratio has been decreased in the year 20142015.

GRAPH NO:5.1#

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Material Management

GRAPH SHOWING 2R?S T,RNOVER RATIO

2011-2012 2012-2013 2013-2014 2014-2015

0

0.5

1

1.5

2

2.5

2.162.06 2.02

1.68

INTERPRETATION:

From the above gra'h it can be inferred that due to lo&er ratio in the year 20142015 the

management has to give more interest to&ards the collection of the money in a better

&ay.

TABLE NO:5.11

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Material Management

TABLE SHOWING STO T,RNOVER RATIO

S48k 4@6n3e6 6a4- =Sales

Averageinventory

A3e6age -n3en467 =Openinginventory+Closing inventory

2

Rs. -n Lakhs

YEAR SALESAVERAGE

INVENTORY

STO

T,RNOVER

RATIO

"#11$"#1" 5%&".11 "%&*.+ ".1*

"#1"$"#1+ 5%'.'& "%5'." "."5

"#1+$"#1& '%1#+." "%*+".5& ".#

"#1&$"#15 '%"5.5" +%"&5 1.*+

ANALYSIS:

From the above table it is observed that there is a increase in the verage inventory and

the (ales during the year 20142015 &hen com'ared to other 'revious years but the

stoc* turnover ratio has been decreased in the year 20142015.

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Material Management

GRAPH NO : 5.11

GRAPH SHOWING STO T,RNOVER RATIO

2011-2012 2012-2013 2013-2014 2014-2015

1.7

1.8

1.9

2

2.1

2.2

2.3

2.19

2.25

2.08

1.93

INTERPRETATION:

From the above gra'h it can be inferred that the com'any has more inventory by the

antici'ation of the sales &hich have not occurred in the year 20142015 so the stoc*

turnover ratio has been decreased during these year.

TABLE NO:5.1"

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Material Management

TABLE SHOWING ,RRENT ASSET T,RNOVER RATIO

Rs. In Lakhs

YEAR SALES,RRENT

ASSETS

,RRENT ASSET

T,RNOVER

RATIO

"#11$"#1" 5%&".11 '%"*"."* #.

"#1"$"#1+ 5%'.'& "%1++." #.&

"#1+$"#1& '%1#+." 11%".&5 #.5"

"#1&$"#15 '%"5.5" 11%**1.'" #.5"

ANALYSIS:

From the above table it is clear that there is a decrease in the current assets during the

year 20112012 due to the cash 6 ban* balances 6 the ca'ital &or* in 'rogress values

in the year 2012201# due to the gradual increase in the current assets the 7urrent asset

turnover ratio has been decreased.

GRAPH NO :5.1"

Page 2#


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Material Management

TABLE SHOWING ,RRENT ASSET T,RNOVER RATIO

2011-2012 2012-2013 2013-2014 2014-2015

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.91

0.87

0.470.52 0.52

INTERPRETATION:

From the above gra'h it can be inferred that there is no much im'act on the business

because the ratio is constant during the year 201#2014 20142015 &hich im'lies the

com'any has made more 'roduct sales &ith minimum investments in the current assets

during these years.

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Material Management

TABLE NO : 5.1+

TABLE SHOWING AVERAGE OLLETION PERIO2

A3e6age 9e6-= No of working days∈a year

Debtors turnover ratio

YEAR

NO O0

WORING

2AYS

2R?S

T,RNOVER

RATIO

AVERAGE

OLLETION

PERIO2

"#11$"#1" +'5 ".1' 1'*

"#1"$"#1+ +'5 ".#' 1

"#1+$"#1& +'5 ".#" 11

"#1&$"#15 +'5 1.' "1

ANALYSIS:

)he above table de'icts the average collection 'eriod due to changes in the debtor

turnover ratio the collection 'eriod has been increased. )he 3rs turnover ratio has been

decreased year by year due to increase in the net annual sales and the average 3rs.

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Material Management

GRAPH NO : 5.1+

GRAPH SHOWING AVERAGE OLLETION PERIO2

2011-2012 2012-2013 2013-2014 2014-2015

0

50

100

150

200

250

2.16 2.06 2.02 1.68

169 177 181

217

INTERPRETATION:

From the above gra'h it can be inferred that the com'any has not follo&ed the stringent

collection 'rocedure so the collection 'eriod has been increased in the year 20142015.

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Material Management

TABLE NO:5.1&

TABLE SHOWING INVENTORY T,RNOVER RATIO

INVENTORY T,RNOVER RATIO¿

Cost of goods sold

Average inventory

YEAR OST O0

GOO2S SOL2

AVERAGE

INVENTORY

INVENTORY

T,RNOVER

RATIO

"#11$"#1" +1&&.' "&*.+ 1."'

"#1"$"#1+ +5*.#* "5'." 1.+*

"#1+$"#1& +#'.*+ "*+".5& 1."*

"#1&$"#15 +'+#.* +"&5 1.1"

ANALYSIS:

From the above table it is clear that there is a fluctuations in the values during the year

201#2014 and in the year 20142015 &hen com'are other 'revious years.

Page 2-


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Material Management

GRAPH NO: 5.1&

GRAPH SHOWING INVENTORY T,RNOVER RATIO

2011-2012 2012-2013 2013-2014 2014-2015

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.26

1.391.29

1.12

INTERPRETATION:

From the above gra'h it is inferred that there is a decrease in the ratio due to reduction in

the demand and also the high inventory in the year 20142015.

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Material Management

TABLE NO : 5.15

TABLE SHOWING STO T,RNOVER IN 2AYS

STO T,RNOVER IN 2AYS = AVERAGE STO +'5 2AYS

OST O0 GOO2S SOL2

Rs. In Lakhs

YEAR AVERAGE STO

+'5 2AYS

OST O0

GOO2S SOL2

STO

T,RNOVER IN

2AYS

"#11$"#1" "&*.++'5 +1&&.' "*#

"#1"$"#1+ "5'."+'5 +5*.#* "'"

"#1+$"#1& "*+".5&+'5 +#'.*+ "1

"#1&$"#15 +"&5+'5 +'+#.* +"'

ANALYSIS:

From the above table it sho&s that the average stoc* of the com'any has been increased

due to the increase in the 'roduction of the 'roducts and the addition of some of the

'roducts during the year 20142015.

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Material Management

GRAPH NO:5.15

GRAPH SHOWING STO T,RNOVER IN 2AYS

0

500

1000

1500

2000

2500

3000

3500

4000

3144.67

3579.093806.93

3630.89

290 262 281 326

COST OF GOODS

SOD

STOC! T"#$O '$

D()S

INTERPRETATION:

From the above gra'h it can be inferred that the com'any holds the inventory for #2"

days during the year 20142015 because of the decrease in the sales or demand to the

'roducts during this year.

Page #0


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Material Management

HAPTER$ '

0IN2INGS

OCe84-3e ; 4he s4@7:$

1. )o study the aterial management system in the com'any.

4. )o analyses the aterial management 'erformance through turn over

ratio.

#. )o ma*e suggestions if there are any 'roblems &ith regard to aterial

management.

4. )o identify the critical arias of aterial management in the com'any.

5. )o analyses the defects in aterial management.

". )o identify the defects in aterial management.

-. )o *no& the aterial techniues in aterial management.

8. )o introduce the modern methods in aterial management.

9. )o study the aterial management system in the com'any.

10. )o identify the modern aterial system.

11. )o identify the eisting aterial system.

S89e ; 4he s4@7:$

)he study is hel's to analyses the aterial managements in )ata (teel td

!ire 3ivision and the main obective is to reallocate the any defects made by the

firm hel's to utilization.

Page #1


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Material Management

0IN2INGS

)he 'ercentage of the $nventory to :et sales has been increased in the year 2014

2015 &hen com'ared to other years.

3ue to increase in the $nventory and the 7urrent assets the inventory to current

ratio has been increased in the year 20142015. )he 'ercentage o the &or*ing ca'ital has been increased from 1.8# to "5 during

the year 2014 2015.

)he net sales of the com'any as increased in the year 2014 ; 2015 as a result of

this inventory to net sales as increased to 52.5"%. )he increase in the total assets in the year 20142015 the 'ercentage of the

inventory to total assets has been decreased to 4".92% in the year 20142015. )he annual consum'tion of the ra& materials has been increased to ,s. ##24."-

a*hs in the year 201#2014.

)he average collection 'eriod have been increased by 21- days in the year 2014

2015. )he turnover ratio have been decreased by 1.9# in the year 20142015.

)he current asset turnover ratio have been decreased in the year 20142015.

HAPTER$

S,GGESTIONS AN2 ONL,SION

Page #2


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Material Management

S,GGESTIONS


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Material Management

Re@84-n -n Lea 4-e

)he com'any must try to minimize the lead time at the time of 'roduction so that

the com'any can reduce the 'roduction time so the com'any can meet the

customers e'ectations. $t is suggested that the com'any should be ado't some

ne& management systems in order to communicate vendors in a short s'an of

time their by reducing the lead time. =ence the organization can com'ete at the

$nternational mar*et and have a better future.

ONL,SION

aterial anagement is one of the basic im'ortant functions of every business. n

average manufacturing organization in $ndia has more than "0% of its current asset

invested in inventories. )herefore by follo&ing 'ro'er efficient aterial anagement

'rinci'les the com'any can certainly reduce the cost of inventory and can im'rove its

bottom line and thereby becoming com'etitive &hich in turn &ill im'rove its mar*et

share.

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Material Management

)he research to'ic aterial anagement has a greater im'lications on $ndian industry

from the analysis of aterial anagement in )ata (teel td!ire 3ivision it is very

clear that it has achieved greater im'ortance in 'roduction control to a large etent. $t is

also enhances the arising need of the organization in res'ect of aterial anagement.

)he aterial anagement in )ata (teel td!ire 3ivision the inventories of the

com'any other than dis'osable scra' are valued at lo&er of cost or net realizable value.

)he cost of materials is ascertained by using the &eighted average cost formula.

deuate 'rovision is made for inventory &hich is more than five years old &hich may

not be reuired for further use.

)herefore aterial anagement acts as the BulseC of any organization and &ill have

im'act on all other activities in the organization. )hough aterial anagement

com'rises huge investment it gives good results &hen good inventory control

techniues are ado'ted and thus enhances the smooth functioning in 'roduction.

)his study has hel'ed me a lot in obtaining good *no&ledge of aterial anagement in

)ata (teel td!ire 3ivision. =ereby aterial anagement is an essential element in

any organization 'rovide it is maintained tactfully by ado'ting latest techniues and

utilizing best resulting from com'uterization.

Finally $ conclude that the com'any is maintaining the good aterial anagement in

order to meet the future demands.

BIBLIOGRAPHY

1. D.sh&atha''a and D.(hridar


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Material Management

4.


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Material Management

:et &orth -01-.24 "#0#."9 5"22.21 5002.5-

(ecured oans 12."1 19.1- 14.-" 0.41

Hnsecured oans 0 0 0 0

)otal 3ebt 12."1 19.1- 14.-" 0.41

)otal iabilities -029.85 "#22.8" 5"#".9- 5002.98A99>-8a4-n O; 0@ns

ross


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Material Management

?m'loyee 7ost 10#0.4# 1110.-9 1081.2# 1041.8" 1009.5

Ether anufacturing ?'enses 0 0 0 1-.05 15.8-

(elling and dmin ?'enses 0 0 0 2"0.84 240.-5

iscellaneous ?'enses "85.-2 509.49 4"5.82 "1.2# "2.4#

reo'erative ?' 7a'italised 0 0 0 0.19 0.#"

)otal ?'enses 5##-.08 5-#9.#4 5242.98 454-.01 4#80.0E'erating rofit 891.11 "42.48 "14."1 940."8 84#.-1

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