(Govt.

Aided ISO 9001:2008 certified Autonomous Institution Affiliated to Anna University)

Thiagarajar college of Engineering

Inventory management Fenner India Ltd Raw material

Guided by: Dr. P.S. BOOPATHI MANICKAM By: S.PRANAVA NANDESH(08G65) S.J.SATHEESHKUMAR(O8G83)

Objective

To keep the investment in inventories as minimum as possible. To avoid obsolescence(no longer needed) of inventor. To find the carrying cost(Future work).

Preview of company

Fenner is one of leading manufacture and exporter of industrial and automotive VBelts, Oil seals and power transmission accessories. At present inventory is monitored using SAP.

Inventory in Fenner
Inventory

Domestic

Imported

FABRIC NATURAL RUBBER, Chemicals

SYNTHETIC RUBBER RECLAIMED RUBBER CORD

CORD SYNTHETIC RUBBER CHEMICALS AND OTHERS

Principle Approach
COLLECTED DATAS FOR 12MONTHS
ENTERED THE DATA IN EXCEL FORMAT GOT THE LEAD TIME. CALCULATED THEIR LEAD TIME STOCK. FOUND OUT HOW MUCH PERCENTAGE THEY ARE AGAINST LEAD TIME. FOR SELECTED ITEMS ABC ANALYSIS IS DONE.
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% Against Lead Time

100% 150% 250%

200%

50%

0%
R1899000045 R1803000004 R1801000006 R1833000001

R1827000008
R1807000008

R1808000003
R1801000013 R1899000014 R1602020001 R1801000003 R1402990002 R1819000002 R1812010002 R1818000008 R1401010002 R1802000001 R1899000032 R1812010004 R1835250002 R1838000001 R1808000008 R1837000003

R1824000003
R1827000007

R1811000032
R1826000003 R1829000001 R1818000010 R1811000031 R1403000001 R1803000001 R1603010015 R1801000010 R1604030001 R1402020042 R1827000015 R1803000002 R1818000006

REASON FOR SELECTION OF 86 ITEMS

Raw Materials

R1801000009 R1502030005 R1402010001

10%

15%

20%

25%

30%

0%

5%

A CLASS 75%

B CLASS 20% ABC ANALYSIS

METHODOLOGY

C CLASS (remaining)

R1401020001 R1812010013 R1803000002 R1502010003 R1402080001 R1826000003 R1601020001 R1401010002 R1812010003 R1827000015 R1835000005 R1812010002 R1402050001 R1818000010 R1807000004 R1806000001 R1402020042 R1820000001 R1801000010 R1827000007 R1829000001 R1824000003 R1502020003 R1837000002 R1822000003 R1838000001 R1837000003 R1601010004 R1811000032 R1899000032 R1801000013 R1899000045 R1835000006 R1807000008 R1802000001 R1824000009 R1811000001 R1810000001 R1601010003 R1899000048 R1822000002 R1819000005 R1833000001

INTERNAL FACTORS
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EXTERNAL FACTORS

EXAMPLE (1) : ISNR

1day-8hrs
Production dept (1day): (a)checking (b)conformation
Purchase dept(1day): (a)Market analysis (b)Raise PO Supplier: (a)Price conformation (b)accepting the PO if not sending for Revision Transport-Source Kerala Thiruvanandhapuram -9hrs,Nagerkoil-8hrs Lead time = 8+8+4+8=3days
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CLASSIFICATIONS:

ITEM A

35 30 25 20 15 10 5 0

CURRENT LEAD TIME (days) RECOMMENDED LEAD TIME (days)

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ITEM B
60 50

LEAD TIME (Days)

40 30 20 10 0

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Material

Processing time in Fenner 2days 2days 1days 1days 2days 1days 1days 1days

Source

Transporta Supplier Lead time tion time Processing time 8hrs 7hrs 3hrs 3hrs 12hrs 3hrs 3hrs 7hrs 4hrs 3hrs 1hr 1hr 4hrs 1hr 1hr 4hrs 3(days) 3 2 2 3 2 2 2

ISNR Poly.Cotton Carbon Black N550 Carbon Black N774 Zinc Oxide Poly ester Cable Cord Poly Cable Cord Methylene Chloride

Nagerkoil Tharmapuri Madurai Madurai Pondy Madurai Madurai Salem

Cisamar

Chennai

30

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CONCLUSION

In this project we have recommended to adapt JIT concept for some of the A and B class materials .At present Phillips Carbon Black LTD and Hi-Tech Carbon companies have opened local hubs in Madurai for Fenner. We have planned to implement this for more materials in class A and B by the beginning of next financial year. We have also suggested to control some internal factors that leads to overstocking of materials . The lead time has been reduced with reference to the data collected from the company and transport authorities as mentioned in the above pages. With all these efforts we expect to reduce the excess stock of materials.
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Future work

Our model is an Probabilities one. By finding out the p(r). We will find out the carrying cost and all other cost in fore coming semester with the help of EOQ.

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