OIL DEPOT SUPPLY CHAIN:

Indian Oil Corporation Limited

Supply Chain Management

Submitted to: Prof Jishnu Hazra
14th August, 2013
Submitted by
GROUP-1, SECTION-1
Aishi Mahapatra
Meera Lakshmi
Sherry Sethi
Vignesh Ramanathan
Abhinav Daharwal
V Shiva Nanditha

1211008
1211037
1211055
1211063
1211090
1211232

Contents
Objective ................................................................................................................................................. 3
Indian Oil and Gas Industry Overview..................................................................................................... 3
Company Overview ................................................................................................................................. 4
Refineries ............................................................................................................................................ 4
Pipeline Network................................................................................................................................. 5
R & D Centre ....................................................................................................................................... 5
Petroleum Products ............................................................................................................................ 5
Supply Chain of Indian Oil: ...................................................................................................................... 6
Depot Operations.................................................................................................................................... 7
Bangalore Depot ................................................................................................................................. 7
Truck Filling Operation in Bangalore Depot .................................................................................... 7
Automated operations using RFID Cards ........................................................................................ 7
Improvements on the current process: .......................................................................................... 8
Manual checking of oil level.......................................................................................................... 11
Standardization of Truck ............................................................................................................... 11
Truck Scheduling ........................................................................................................................... 11
Recommendation.......................................................................................................................... 12
Objective function:........................................................................................................................ 12
Constraints: ................................................................................................................................... 12
Distribution Planning: ........................................................................................................................... 13
Demand centre (Customer touch-points):........................................................................................ 13
Distribution in Bangalore City ........................................................................................................... 13
Issues in Transportation from Depot to Pump ................................................................................. 14
Customer Operations: ...................................................................................................................... 15
Recommendations for improved retail outlet operations: ........................................................ 17
Recommendations ........................................................................................................................ 18
References: ........................................................................................................................................... 18
Exhibits: ................................................................................................................................................. 19

Objective
The project aims to study the last mile delivery of petroleum products of the Oil Conglomerate,
Indian Oil Corporation Ltd and analyze the following:

Depot Operations, with focus on distribution planning & filling operations of Bangalore Depot
Transportation Issues and Best Practices
Retail Outlet operations

Storage

Transportation

Market

Indian Oil and Gas Industry Overview

Oil and Gas industry is one of the six core industries and contributes to about 15% of Indias GDP.
India is the sixth largest consumer of oil in the world and the ninth largest crude oil importer. Owing
to its significance to the economy the Government has taken many policy initiatives to boost its
growth.
Crude oil production, as indicated by the core sector index, accounts for over 5 per cent of India's
index of industrial production (IIP). Natural gas sector constitutes about 9.8 per cent of primary
energy consumption which is projected to grow up to 20 per cent by 2025. Oil is of highest priority in
Indias export basket during 2012-13.
The main Indian players in the UPSTREAM (Exploration & Production) sector are Oil & Natural Gas
Corporation Ltd. (ONGC), Oil India Ltd., Reliance, Cairn Energy, HOEC, and Premier Oil. Those in the
downstream (Refining, Marketing &Pipelines) are Indian Oil Corporation Ltd., Hindustan Petroleum
Corporation Ltd. (HPCL), Bharat Petroleum Corporation Ltd. (BPCL), Mangalore Refinery &
Petrochemicals Ltd (MRPL), and Reliance Industries Ltd. (RIL) / Essar Oil Ltd. / Shell. Indian Oil
Corporation Ltd. has its presence in transport and distribution of Gas also, the other major players
being GAIL (India) Ltd., Reliance Industries Ltd. (RIL), Gujarat State Petroleum Corporation (GSPC),
Indraprastha Gas Ltd (IGL) and Mahanagar Gas Ltd (MGL). A CAGR of 4.1% over the last 5 years (0712) is a strong indicator of the huge growth potential this industry has in India.

Company Overview
Indian Oil Corporation Ltd. is one of the major downstream players in this sector. The company is a
Market leader with 46% market share and 52% market share in terms of infrastructure. Its share in
the retail sales is 45% that in the highly competitive lube market is 30.8%. With the launch of SERVO
in Bahrain, the brand has now presence in 20 countries. Indian Oil Aviation Service, with 61.8%
market share, maintained its leadership position in the business.
The major divisions of Indian Oil include Refineries, Marketing, Pipeline Divisions and an R&D Centre
which supports these divisions.

Refineries
Indian Oil Corporation Ltd. controls 10 refineries across the country which amounts to 31% of the
capacity of the industry and 65.7 MMT in absolute terms. IOCLs share is to further increase after the
commissioning of 15MMTPA at Paradeep. Three refineries with maximum capacity are located in
the high consumption North-West Indi an region Panipat, Mathura and Koyali.

Crude
Imports

Prod. Imports /
Exports

Dom
estic
Dem

Dom
estic
Crud

Imp.
LS
Crud

International
Trade
C
r

Refineries

Product
Transfer

Marketing
.

Imp.
HS
Crud

OMC
s
exch
Support Pipe Lines /
R&D

UpStream

Impo
rts /
Expo

Support
DownStream

The strategic refinery location ensures effective supply and evacuation system through pipelines.
Year 2012 has recorded the highest ever throughput (77.8%) as well as the highest ever distillate
yield (77.8%) for the company up till now. IOCL has also had 100% capacity utilization for the 5th
consecutive year with 118% utilization for crude pipelines in 2012. All of IOCLs refineries are Euro
III/IV compliant. Refer exhibit 1 for more details.

Pipeline Network
IOCL has the largest liquid pipeline network in the country with nearly 10,777 Km in length; the
network contributes to 73% of crude oil pipelines and 50% of product pipelines. These pipelines
help reduce costs of transportation. The company has just completed the 217 Km long Virmgam
Kandla product pipeline as well as undertaken a capacity augmentation of both the Chennai-TrichiMadurai and Chennai-Bengaluru pipelines. Refer exhibit 2 for more details.

R & D Centre
The company has cutting edge R&D which contributes in the commercialization of technologies like
INDMAX for maximization of LPG & light distillates from Refinery Residue, technology to make high
value needle coke, Diesel Hydro-treating (DHDT) and Light Naphtha Isomerization. IOCL is also
widening its horizons by the MOU with the Department of Bio-Technology to set up Advanced Bioenergy Research Centre. IOCL also added another six to its long list of patents in the year 2012

Petroleum Products
Petroleum Products are classified into the following major categories
Category
Dangerous Petroleum (Class A)
Non-dangerous Petroleum (Class B)

Heavy Petroleum (Class C)

Characteristics
Flash Point below 23 deg C
MS / Naphtha / AV Gas etc.
Flash Point more than 23 deg C but less than 65
deg C
HSD / SKO / ATF etc.
Flash Point more than 65 deg C
FO / LSHS / HF HSD etc.

The different petroleum products of IOCL are as follows:

Motor spirit (MS)
High Speed Diesel (HSD)
Superior Kerosene Oil (SKO)
Auto LPG
Automotive Lubricants
Naptha (SRN)
Furnace oil (FO)
Light Diesel Oil (LDO)
Bitumen
Sectorial requirement of each of these products is provided in Exhibit 3.The different brands of
Indian Oil Corporation Ltd are

Supply Chain of Indian Oil:

The picture below depicts the various stages involved in transforming the raw material i.e. crude into
various petroleum products and distribution of these products to the end customer or consumer. As
indicated earlier, Indian Oil operates in the downstream portion of the supply chain.

Supply Chain Management at Indian Oil is an integrated business process which requires planning
from procurement of crude in order to meet demand at depots, while maximizing the total
corporate profit. Based on crude availability in the international markets and demand planning
based on historical sales data and market intelligence, inputs are given to International trade
department which tries to purchase crudes that maximize margins; Refineries which optimize
operational plans based on set targets; and Sales& Distribution which optimizes operations and
chalks out distribution plans accordingly.

Depot Operations
Indian Oil has nearly 240 storage depots spread across the country which render supplies of
products such as Petrol, Diesel, Kerosene, Air Turbine Fuel.
Bangalore Depot
The depot stores petroleum products and supplies the same to nearly 270 retail outlets and other
major institutional customers. The products are stored in tanks which are of two types: Above
ground or underground. The cumulative capacity of the depot is close to 78000KL
Therefore the primary purpose of an oil depot is to

Provide intermediate storage

Act as a filling point for transportation of oil to end users in Tank Trucks(Oil tankers)
Manage oil inventory to satisfy demand of associated customers.

Truck Filling Operation in Bangalore Depot

DEPOT
Oil Tanker
Queue
Filling Facility:
20 Bay Points
The filling operation proceeds as follows:

The scheduling of Tank trucks is handled by a planning officer, through a partly automated
process
The allocation of the trucks to the bays is based on the availability of the same.
The filling rate is about 800L/min. Hence it takes around 30 minutes to fill a 24KL tanker.
Once the tanker has been filled it has to wait till the oil level is checked an approved by the
officer in-charge.

Automated operations using RFID Cards

An empty truck is scheduled to transport products for a customer by assignment of an RFID card and
is also given a printed filling order with the following information
1. Truck Identification(Truck Registration Number)
2. Assigned Bay Number

3. The product and quantity to be filled in each compartment in accordance with the capacity of
the truck
4. Name of the Customer
Improvements on the current process:
In the existing system an RFID card is assigned to a truck for every order. A card reader is employed
to read the card identification number and assign it to a particular truck. The purpose is to map the
truck details (i.e. Truck number, compartment capacities) and order details of type of product,
compartment wise -quantities, bay number. This gives the truck the access to the depot filling
facilities and the truck can be loaded in the assigned bay with the appropriate products in the
respective quantities.
Once the card is assigned, the filling order which is a hard copy of the order details is printed. These
are collected by the truck drivers and the trucks queue up to enter the depot.
Instead, we recommend that a unique card is issued to every truck. By the card identification
number, the information of the truck number, capacity of each compartment is readily available in
the automation system and assignment of a particular order can be done electronically without
reading the card number every time. Also, the filling order can be given to the truck at the entry
point into the depot. This eliminates waiting time at the planning office to collect the filling order
and the card. Additionally, the card can be used to track the availability of the truck by including an
additional status- Reported in addition to the existing ones of Registered, Authorized, Inside
Loading Area etc. This status is to monitor whether the truck has reported at the depot on a
particular day. Currently this reporting is being recorded through manual entry
This method can achieve savings of 2 to 3 man hours a day in the planning department as the
manual process of card allotment can be eliminated and the filling operations can start at least half
an hour early which means filling of 20 additional trucks. This translates to increase in throughput to
nearly 6.25 %( Average number of trucks filled per day=320). And the delays in collecting the card
from the planning department can be avoided. This could increase the number of cards in circulation
and could involve some fixed costs. However the process becomes more streamlined and savings
can be obtained in the long run.
Additionally by avoiding usage of officer card which is used to change truck status from Loaded and
not sealed to Loaded and sealed, one step can be reduced in filling operations. As there are usually
one or two such cards and trucks often wait at the bay when the card is being used at another bay.
The various stages in the planning and truck filling operations that are observed in the automated
system are depicted by the following flow charts for existing system and proposed system which
reduces nearly 7 steps in the existing process

Existing Sequence:
1) Read Card Number

Registered

2) Assign bay number

3) Print FAN(in planning dept)
Authorised

4) Crew Collect filling order from planning dept.

5) Place the truck in Queue
6) Security check at main gate
7) Locks opened at kiosk
8) Card shown at Card Reader

Inside Loading
Area

9) Wait at Bay
10) Reallocation of Bay if another bay is empty
11) Show Card at load computer in bay
Under Loading
12) Truck loaded
Loaded and not
Sealed
13) Show Officer card to indicate loading is over
Loaded and Sealed
14) Park the truck

Reports Printed
15) Wait and collect reports at planning dept.
16) Collect locks
17) Take signature of TLF officer
18) Proceed to locking
19) One copy of invoice collected
20) Check at main gate for VMU and details of load.

Loaded and
Outside

Proposed Sequence:

Registered

1) Read Card Number

2) 1)Assign bay number
3) 2)Print Filling order(in planning dept at Main Gate)
Authorised
4) TT crew Collect FAN from SND
5) 3) Place truck in Queue
6) 4) Security check at main gate& collect filling order
7) 5)Locks opened at kiosk
8) 6)Card shown at Card Reader
9) Wait at Bay

Inside Loading
Area

10) Reallocation of Bay if another bay is empty

11) 7)Show Card at load computer in bay
Under Loading
12) 8)Truck loaded

13) Show Officer card to indicate loading is over

Loaded and not

Sealed

14) 9)Take signature of officer on Filling order

Reports Printed
15) 10)Park the truck
16) 11)Wait and collect reports & locks at planning dept
17) Obtain locks from control room(if required)
18) Take signature of TLF officer

Loaded and Sealed

19) 12)Proceed to locking

20) One copy of invoice collected
21) 13) Check at main gate for VMU and details of load

Loaded and
Outside

Note: Striked out lines indicate steps eliminated by the proposed process & Bold indicates new step.
Manual checking of oil level
Dip checking is a process of checking the level of oil in each compartment after the oil tanker has
been filled. An oil paste is applied to the dip rod and the rod is inserted into a dip hole provided on
the top of each compartment of the tanker. The oil leaves a mark on the paste and this serves as an
indicator of the level of oil.
Manual checking is still followed due to the following reasons:
Variations in temperature: During the day oil temperature can vary by 4-5 degrees,
depending on the weather. The coefficient of expansion per KL per degree is ~1.26 L for
Petrol, ~ 0.9 L, ~0.95 for Kerosene, ATF. This can cause expansion/contraction in the level of
oil 1-2 mm difference in level for a 5kL volume.
Automation failures: Overfill/Under fill may occur due to faulty flow meter and gauges.
With technological advancements, these variations have been considerably minimized over time. By
appropriate maintenance activities variations can be avoided and the old policies should be changed
to eliminate the procedure of dip checking.
Savings through avoiding Dip checks:
Time required for manual checking = 2-3 min
Average Number of trucks filled per day per bay= 320/20=16
(Assuming average number of trucks filled daily=320)
Time saved per bay by avoiding dip checking = 2x16=32 minutes
Therefore 1 additional truck per bay can be filled per bay, which translates to 20 additional
trucks per day. This is equivalent to an increase in throughput by 6.25%{ (20/320)x100}
Standardization of Truck
Trucks that transport oil can be of two types:
1. Trucks owned by the retail outlets
2. Trucks contracted by the depot and used for transportation to various customers
Each truck is checked thoroughly for appropriate fittings and specifications and the truck is
calibrated by an officer at the depot in the presence of an executive from the State Weights &
Measures Department. This process is repeated annually for every truck. It has been observed that
the trucks are mostly of local make leading to considerable variations in tank sizes and different dip
levels. It is also observed that quality of fittings like as pressure release valves, vinyl layered caps is
poor for the trucks made by local manufacturers
We recommend an approach of standardization is followed with respect to trucks. That is Indian Oil
should collaborate with a few Truck manufacturers and standardize the design of the truck. This
would ensure uniformity and quick access or availability of customers or contractors who intend to
purchase trucks. This can also ensure that safety standards are adhered to and norms pertaining to
painting are strictly followed. This standardization also ensures that there is not much difference in
the calibrated levels of dip rod for different trucks.
Truck Scheduling
For some of the sale points the depot invites for tenders and enters into a contract with
transporters. These trucks are employed to transport products to customers who dont own a truck

or when the customer needs excess product or their own truck is not available. The payment to the
Transporters is based on the distance travelled. Ideally the distance travelled by each truck should
be the same so that each truck dealer gets a fair share. However due to the manual planning process
there is a possibility that some contractors are favoured intentionally or there is always scope for
human error. These can be avoided by automation of the process of scheduling using linear
programming as described below.
Recommendation
We tried to solve this problem by using linear programming. The formulating of the problem is as
below
xijk = if truck k will deliver to location i on day j, binary variable
yi = distance from depot to location i
For developing the LP, we assume a 5 day week, 5 locations and consequently 5 trucks. These can be
modified as required.
Assumptions:
1. Only one delivery per sale point per day
2. Each truck belongs to a different truck dealer.
Objective function:

Minimize

Constraints:
1. On a particular day a truck can travel a single location

1
1

1
1

1
1

.
2. Only one truck goes from the depot to a particular location

..
.
3. Positivity constraints
xijk 0
This LP should give us the schedule of trucks to be used so that all trucks travel more or less the
same distance. Hence the payment to each truck dealer would be the same.
Future scope is to include additional variables in linear programming like traffic constraints, priority
depending on availability of stock in Retail outlets and also timely reporting of truck at the depot.

Distribution Planning:
The products from the refinery (port, pipeline storage centre etc.) are transported to Terminal/ Port/
depot from where it is further supplied to retail outlets. The terminal acts as a warehouse from
which goods are supplied to retailers. Indian Oil has a large distribution network, consisting of 150
bottling plants, 200 depots, 40 terminals, extensive pipeline network.
Terminals & Depots are centres for receipt, storage & distribution of bulk petroleum products.
Terminals receive products mainly by Pipelines / Ocean Tankers, whereas Depots receive products
mainly by Tank Wagons & Tank Trucks.

Demand centre (Customer touch-points)i:

Indian Oil has a much diversified customer base- in core sectors including railways, aviation, power
house, coal, fertilizer plants, transport and defence. The turnover growth is insulated from the
cyclical demand fluctuations due to this diversified customer base. Its branded products include Xtra
Premium Petrol, Xtra Mile Diesel. Its branded services are Kisan Seva Kendra and Xtra Care Outlets.
Retail outlets, Aviation Fuel Stations, Bulk Consumer Pumps, SKO/ LDO are various demand centres.
These touch- points are supplied by Depot. There are special outlets for rural areas called Kisana
Sewa Kendra. Retail Outlets are operated both by company and dealers. The retail outlets operated
by companies are called Company Owned Company Operated outlets. The depot also supplies to
government public transport companies, other depots and railways.

Distribution in Bangalore City

Bangalore has 276 Indian Oil Retail Outlets and 1 depot. The capacity of the depot is 78,000 kilo
litres. Daily sales volumes for Bangalore are approximately 1170 kilo litres. Four day sales quantity is
kept as inventory.

No. of depot in Bangalore

No. of petrol pumps
Type of petrol
Average daily sale for Bangalore city
Capacity of terminal/depot
Safety stock for depot
Capacity of tankers

01- Bangalore terminal

276 pumps
Bangalore urban - BSIV MS
& Bangalore rural - BSIII MS
1170 KL
78000KL
4 day stock
12KL or 20KL

Issues in Transportation from Depot to Pump

Traffic
restrictions in
certain routes

Pilferages
enroute

Issues
Human error
wrong routes

Control over
transportation

One of the major issues seen in transportation from depots to petrol pumps is pilferage. There are
specifications about the types of trucks used or transportation but the process and specifications are
not fool proof. IOCL has 18000 Tank Trucks across all India. 60% are dealer owned tank trucks. 40%
are owned by transporters. Due to this variation in ownership, the standards are not closely
followed. To address this issue we recommend adopting the best practices in the industry. For
example: Some oil companies own the full fleet of trucks. They have standard specifications for the
trucks used for transportation and the manufacturing of the trucks is outsourced.
Also, sometimes tanker drivers might take incorrect routes .Some routes also have certain traffic
restrictions at particular times of the day , and this might delay transportation. To increase control
over these issues, Indian Oil has adopted Vehicle Monitoring System through installation of devices
on tank trucks- called Vehicle Monitoring Units.
To monitor trucks, every truck (dealer or Indian Oil) is provided with a realtime Vehicle Monitoring
Unit for monitoring 3 elements:

Route
Speed
Stoppages enroute
Also , routes for trucks are established by IOCL sales department and depot , once in 3 years and
verified every year . Transport contractors are paid based on the cumulative distance covered
(monthly payment)

Customer Operations:
Types of customers
IOCL has two types of customer for which supplies happen through the depot. These are:

Institutional clients
Petrol pumps

IOCL
constomer for
Petroleum
Products

Institutional
cutomers

Petrol pumps

Company
Owned
Comapny
operated

Private
dealership

Institutional clients: These clients are basically the railways, state transport corporations-KSRTC,
industries etc. SMEs and industries having separate self-operated dispensers and account for 3-4% of
the total demand for products. This demand is serviced in a same way as that for the petrol pumps
as shall be discussed below.
Petrol Pumps: Petroleum products in India reaches the end user primarily through sale from petrol
pumps or retail outlets located across the length and breadth of the country. The Indian Oil
Corporation limited petrol pumps supplies consumers with following products: Petrol (called as MS
by oil companies), Diesel (HSD), high oil grease and other products. Also there are branded products
such as XtraPremium (Petrol), Xtramile (Diesel)
The petrol pumps are of two types:
Company owned and Company operated- termed as COCO
Privately owned and operated through dealership
The difference is in the management of outlet. In case of privately owned outlets; all the hiring,
staffing, ordering, managing daily operations of the pumps etc. is taken care of by a dealer who gets
a fixed commission per liter of sales. The dealership is given based on the standard bidding process.
In COCO, an Indian Oil Officer is appointed and acts as the in charge. There exists a agreement with a
Service provider who provides manpower, and other amenities.

The decision to choose between a COCO and Retail Outlet depends on profitability and viability. If
the corporation considers that the profits can be high, then it would be more profitable to not share
revenues with the dealer and the COCO model would be chosen. Also, when no dealers come
forward to bid, the corporation would start a COCO with service agreements from nearby dealers for
provision of man power.

Contract between Service Provider (for coco) and IOC specifies the following:

Equipment and manpower

Rates applicable for various services
Bills are to be prepared on monthly basis and submitted within 15 days from close of the
month
Working conditions, Govt rules and regulations pertaining to Minimum wages
Arbitration by Director(Marketing) incase of disputes

The corporation has the right to terminate the contract at any time, if services are not satisfactory

Issues and Best practices followed:

The location of new retail outlet :

The decision on location of any new petrol pump is taken after a rigorous analysis of market
potential, competition, availability of land, provision for electricity, water and manpower is taken
into consideration and only after each of the criteria is met the site is selected always on the side of
main road.

COCO or private dealership RO :

IOCL usually operates COCO type pumps when the location guarantees high return without having to
bear any demand risk or when the location is of low viability such that no bids are received from
dealers.
The whole process of allotting petrol pumps to dealers happens through a competitive bidding
system , but there are several loop holes and it is highly skewed in the current scenario due to
domination of unions and groups over time

Storage and products at Retail Outlets

All petrol pumps have a standard underground fuel tank of 16KL or 22KL etc. , depending upon the
expected demand. This is provided by IOCL at the pumps premises along with the dispensing
machines. There are as many as 276 IOCL pumps in Bangalore alone, all serviced by single Bangalore
terminal of capacity 78000KL.
The types of petrol (Motor spirit) are Bangalore urban- BSIV MS & Bangalore Rural- BSIIIMS.
The average monthly sales per petrol pumps is around 127KL, but the sale varies hugely depend
upon the location.

Ordering process :
Each customer getting products from the IOCL depot has to register with IOCL and receives a unique
customer ID. The customer generally maintain a safety stock of four days and orders quantities equal
to size of tanker truck i.e. 12KL/20KL/24KL etc.
Payment for each order has to be done in advance through RTGS or Demand Draft before the
delivery date. Also the customer can book an order any time in advance however the payment can
be made just before the actual delivery. The customer also has flexibility to change/cancel the order.

However in case of shortages, the retail outlet owner can inform the planning department of depot
only through the field sales officer. This leads to delay in communication due to intermediation of
sales officer and can be avoided if stock details of retail outlet are available to planning department
of depot

Unloading at the outlet site:

The measurement is done through dipstick rod in presence of both pump operator and IOCL
personnel. After measurement the tanker is unloaded into the tank. The inventory is noted daily by
the owner and the sales is matched with it. To unload the tanker it takes about an hour.
Other Externalities:
Stock outs at Retail Outlets due to the following reasons:

Strike of transporters- This can lead to stock out at outlets which do not possess dedicated trucks.
Production shortage at refinery, logistics issues such as pipeline damage, rail derailment etc.
Delay in supply by depot due to congestion of orders or scarcity of tanks on a day.
Unexpected price hike of fuel and/or strikes/curfews : Hoarding by other retail outlets to make use
of price arbitrage can affect those outlets which do not resort to similar activities.
Recommendations for improved retail outlet operations:
Transparency in whole distribution system: The bidding process can be made more competitive and
transparent. This will bring effectiveness, value addition and the outlet owner will became more
performance oriented.
The dispensing machine should be made tamper proof and strict penalties should be levied on
culprits. Regular checks by anti-adulteration cell can ensure quality of products
Investing in R&D to reduce losses due to vaporization can increase profit in long run.
Data integration with IOCL planning department at depots - This will ensure real time data sharing
and hence better planning, reduced inventory both at depot and pumps, less losses and optimum
use of resources.
Unexpected price fluctuations: Demand surges rapidly and orders are placed in bulk by all dealers.
Hence the total Supply chain is at a loss because the future demand is met at current lower price
point. To avoid such a situation government should suddenly announce the price hike so that media
doesnt speculate price hike.

Recommendations
The following is the list of key recommendation which have been discussed in detail, in the earlier
sections:
1. Allotment of unique card per truck instead of assignment for every order can achieve
additional throughput of nearly 6.25% ( or reduce the time for daily operations by half an
hour)and save 2 to 3 man hours per day.
2. Avoiding Manual checking of dips after trucks are loaded can enhance the throughput by
6.25% or reduce the time for daily loading operations by nearly 32 minutes
3. Collaborating with truck manufactures can help solve issues of pilferage, calibration, safety,
losses due to vaporisation of products due to sub-standard fittings.
4. Adopting a scheduling model which incorporates the variables of distance traversed by
contractor trucks, reporting details of the trucks, priority of order based on stock availability
at retail outlets and real-time traffic updates can make the system more efficient and more
transparent with respect to revenue sharing amongst various contractors.
5. Stringent policies should be in place to prevent malpractices of pilferage and adulteration
which are quite prevalent in this sector.
6. Price hike/ reduction should be announced suddenly, leaving no room for speculation by
media to prevent skewed demand and losses to the supply chain.

References:
1. http://www.ibef.org/industry/oil-gas-india.aspx
2. IOCL Investors presentation
http://www.iocl.com/downloads/Investor_Presentation_2013.pdf
3. Interview with IOCL personnel. The interviewee has requested anonymity, as this is a purely
academic project. The data and facts of IOCL should not be shared outside the institute.
4. http://oilgas.flemingeurope.com/oil-gas-supply-chain-forum
5. https://www.bimco.org/en/News/2012/09/26_Feature_Week_39.aspx
6. http://www.runthemodel.com/models/808/
7. http://dspace.mit.edu/bitstream/handle/1721.1/33345/62395452.pdf

Exhibits:
Exhibit 1: IOCL refineries across India

Exhibit 2: The IOCL oil and pipeline network

Exhibit 3 : Sectoral Requirement of Products

Exhibit 4: Customer touch points