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PROJECT SYNOPSIS

Roll No: PMI R-XXXI V-39


HYDERABAD









PROJ ECT TI TLE:

A STUDY ON INVENTORY MANAGEMENT PRACTICES OF KCP CEMENT.
1) INTRODUCTION:

Inventory management is the process of efficiently overseeing the constant flow of
units into and out of an existing inventory. This process usually involves controlling the
transfer in of units in order to prevent the inventory from becoming too high, or dwindling to
levels that could put the operation of the company into jeopardy. Competent inventory
management also seeks to control the costs associated with the inventory, both from the
perspective of the total value of the goods included and the tax burden generated by the
cumulative value of the inventory.
Balancing the various tasks of inventory management means paying attention to three
key aspects of any inventory. The first aspect has to do with time. In terms of materials
acquired for inclusion in the total inventory, this means understanding how long it takes for a
supplier to process an order and execute a delivery. Inventory management also demands that
a solid understanding of how long it will take for those materials to transfer out of the
inventory be established. Knowing these two important lead times makes it possible to know
when to place an order and how many units must be ordered to keep production running
smoothly.
Inventory management is not limited to documenting the delivery of raw materials
and the movement of those materials into operational process. The movement of those
materials as they go through the various stages of the operation is also important. Typically
known as a goods or work in progress inventory, tracking materials as they are used to create
finished goods also helps to identify the need to adjust ordering amounts before the raw
materials inventory gets dangerously low or is inflated to an unfavorable level.

The overseeing and controlling of the ordering, storage and use of components that a
company will use in the production of the items it will sell as well as the overseeing and
controlling of quantities of finished products for sale. A business's inventory is one of its
major assets and represents an investment that is tied up until the item is sold or used in the
production of an item that is sold. It also costs money to store, track and insure inventory.
Inventories that are mismanaged can create significant financial problems for a business,
whether the mismanagement results in an inventory glut or an inventory shortage.


2) COMPANY PROFILE:

Value services is a one of the reputed research firms in Hyderabad which conducts research
work related to industry, company in the areas of marketing, finance, HR and operations in
the field of management and also undertakers research work on it related projects.

Value services is a qualitative, fast growing training, development, placement and consulting
firm that is actively engaged in providing training, development and placements at all levels
across sectors.
It is headed by team of professionals having combined corporate experience of 20 years. We
specialize in offering customized solutions that are rendered with a quality-oriented approach
for a variety of industries and candidates requiring training/development and manpower.
Besides value services also has now entered into consulting along with overseas education/
overseas jobs with our assessments and training partners. Ethics, integrity and quality is our
governing values.
Value services, one of the fast growing end-to-end recruitment & staffing solutions
consultants in India. Value services provides a comprehensive, end-to-end recruitment
solution, HR solutions, research solutions that covers every need of the customer, throughout
the business cycle.
our team of experts, with over a decade of experience, brings the best practices &
methodologies in the industry. This helps us deliver the optimal solutions for even the most
complex challenges to our global customers across industries. Value servies leverages
technological advance to bring speed, agility and cost efficiency to the whole gamut of
processes.



3) NEED FOR THE STUDY:
Inventory is a list of goods and materials or those goods and materials themselves
held available in the stock. Materials are equivalent to cash and they make up an important
part of the total cost. It is essential that materials should be properly safeguarded and
correctly accounted. The success of a business concern largely depends upon efficient
purchasing, storage, consumption and accounting. The present study helped to collect the
information on existing inventory Management practices at KCP Cement Company.
4) SCOPE OF THE STUDY:
The scope of this study concerns the fine lines between replenishment lead time, carrying
costs of inventory, asset management, inventory forecasting, inventory valuation, inventory
visibility, future inventory price forecasting, physical inventory, available physical space for
inventory, quality management, replenishment, returns and defective goods, and demand
forecasting. Balancing these competing requirements leads to optimal inventory levels, which
is an on-going process as the business needs shift and react to the wider environment.
The study is confined to stores department of KCP Cement factory at Hyderabad.
The following aspects will be considered:
Determination of the type of control required,
The basic economic order quantity,
The recorder point, and
Safety stocks.

5) OBJECTIVES OF THE STUDY:
To know the inventory management procedures followed at KCP Cements at
Hyderabad division
To review the ABC Analysis and understand the impact of business dynamics on
inventory.
To know the relationship between raw materials and sales.
To suggest the company for improving current practices and using alternative
inventory management procedures.

6) RESEARCH METHODOLOGY:
DATA SOURCES:
The Study is based on Secondary data only. The data will be collected from the
Secondary data to be collected from the stores department of KCP Cements. The data will
be taken from past five years i.e. 2007-2012 from company inventory reports and cost
accounts.
DATA ANALYSIS:
The data will be analyzed using ABC Analysis and inventory ratios.
7) LIMITATIONS OF THE STUDY:
1) The data will be collected using secondary data sources of last four years only.
2) The study is limited to 45 days only
3) The Study is bounded for only stores department
4) Some of the information may be kept confidential by company.

8) ANTICIPATED OUTCOMES OF THE STUDY:
Inventory, as a current asset, differs from other current assets because only financial
managers are not involved. Rather, all the functional areas finance, marketing, production,
and purchasing, are involved. The views concerning the appropriate level of inventory would
differ among the different functional areas. The Conflicting view points of the various
functional areas regarding the appropriate inventory levels in order to fulfill the overall
objective of maximizing the owners wealth. This study provides insight to the management
of High Value items and also brings attention of management towards movement of A class
items over period of last five years. .

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