supply chain presentation bipl

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BIKIYA INDUSTRIES PRIVATE LTD SUPPLY CHAIN

Anticipating the customer’s requirement on continuous basis.

REVIEW

AUTHOR Farrukh 'Hasnain

DATE 11 November 2016

DOCUMENT CONTROL SCP-01

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SUPPLY CHAIN’S ROLE IN BIKIYA INDUSTRIES


To provide Competitive Advantage in supplying products to our customers. The advantage will be sustainable and shall have a significant impact on BIKIYA’s profitability .

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VISION TO REALITY


1.Create efficient and effective Supply Chain and its sub processes and methods .

2.Develop the operating principles that will deliver a significant competitive advantage.

3.Ensure the operating principles are implemented through monitoring of the KPI’s.

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THE SUPPLY CHAIN MODEL


BIKIYA INDUSTRIES LEADERSHIP AND STRATEGIC MANAGEMENT

PLANPLANNING

SOURCE MAKE DELIVER RETURNS

CUSTOMER DEVELOPMENT

SUPPLIERS

BRAND DEVELOPMENT

CUSTOMERS

INFORMATIONHUMAN RESOURCE

FINANCE

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NORMS OF DEMAND AND SUPPLY PLANNING


Sales Forecast Receiving 25th of every month for next month

MRP (Material requirement planning) 26th of every month for next month MPS (Master production schedule) 26th of every month for next month Monthly production plan (tentative) 27th of every month for next month Weekly production plan Every Saturday for next week Daily Production plan Based on FG region wise

stocks review & sales orders S&OP weekly meeting Every Monday @ 10:00 AM. New printing SPJs lead time. 21 days (For Boxes) Rubber stamp making lead time 2 days (For Napkin)

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PLANNING PROCESS


Sales Orders/ Sales Forecast MPS ProductionMRP

Procurement

QC

Shipment

Warehouse RM/PM/AM

Logistics/ Distribution

FG’s WarehouseSupplier

(s)

Sales/ Marketin

g

Inspection Ok-Not Ok

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PLANNING


PURCHASING

INBOUND DELIVERIES

PRODUCTION PLAN

OUTBOUND TRANSPOR

TDEPOTS DISTRIBUT

OR

SUPPLY PLANNING DEMAND PLANNING

STRATEGIC DIRECTION :

For current year planning is being done on the basis of monthly sales forecast. Production is only stopped in following circumstances Forecast is achieved or warehouse occupancy hits 100%. Production will be as required , strictly on PULL basis. FG safety stocks cover to be kept for 10 days.

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SOURCE (PROCUREMENT)


Purchasing has been split into 2 distinct areas:1. Supplier Management (Vendor development & Induction ,

Negotiation ,Performance monitoring with approved suppliers list.

2. Contract Management (Documentation and clerical work)

KPI’s are based on Q C D (Quality , Cost and Delivery )

We will review KPI’s of top suppliers on monthly basis.

For all purchases related to RM,PM,AM developing at least 3 suppliers to meet the committed timely deliveries.

Aim to reduce supplier rejection with proper tracking on deliveries and strict monitoring of quality .

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PROCUREMENT PROCESS


Price analysis of suppliers to create healthy competition amongst them giving us a lower cost in prices.

Reduced cash purchases and diverting all suppliers to PO, reducing risk of fraud and improving cash flows.

Improving inventories of consumable items by maintaining proper ERP system codes and ordering as per requirement.

.

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MAKE (PRODUCTION/MANUFACTURING)


Key Action Points :

System first checks inventory on hand for sufficiency.

Calculates labor needs and determines whether overtime or temporary help will be needed.

Based on BOM, determines what components need to be ordered.

The MPS is adjusted to include the new order.

Manufacturing resources . 4Ms (Man-Machine-Material-Method )

11Anticipating the customer’s requirement on continuous basis.

MAKE (M/C CAPACITIES & NORMS)M/C # Art : # SKU CTNS Ton/ Day/

Shift

M1

114 Royale Silver 446

2

115 Royal Gold 223120 Perfumed Memories 446121 Shades (PY) 320122 Shades (GB) 320123 Pop Up 396124 Shades Pop Up 396125 Tux Square 446126 Ease 186

M2

111 Gear 438

1.2

112 Grande 100 347113 Grande 150 233116 Theme Blue 377117 Theme Pink 377118 Theme yellow 377119 Theme Green 377

M3

211 Single Roll 200

1.1

212 Twin Roll 150213 4 Roll 150214 10 R Wrapped 200216 Single Roll (B) 200217 Twin Roll (B) 150218 4 Roll (B) 150219 10 R Wrapped (B) 200311 Kitchen Roll 1R 120 0.9312 Kitchen Roll 2R 90

M4 411 Quix Brown 50 0.2412 Quix White 50M5 613 Rush Dozen 40 0.2

M6 513 Coffee Napkin 15 0.2

M7 511 Table Napkin 25 0.3

M9711 Dawat Pack White (36 PCs) 70 0.6

712 Dawat Pack White (48 PCs) 52 0.5

7.2

MOQs :(Minimum Order Quantity)s

MOQ for SPJ : Boxes (2000) For Coffee Napkin :

(60,000) Napkins For Table Napkin :

(60,000) NapkinsStrategic Choices Of Operating Environment : Bikiya Industries currently operating in following environment.

Make to stock Make to order

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VARIOUS CAPACITIES :


Design Capacity :

Maximum obtainable output .

Effective Capacity :

Maximum capacity subject to planned and expected variations such as maintenance , lunch breaks , scheduling conflicts.

Actual Output :

Rate of output actually achieved . It is subject to random disruptions: machine break down , absenteeism , material shortages and most importantly the Demand.

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EFFICIENCY AND UTILIZATION:


Efficiency And Utilization Calculation :

EFFICIENCY : Actual Output / Effective Capacity

UTILIZATION : Actual Output / Design Capacity

Both measures expressed as percentage %.

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THE BULLWHIP EFFECT RESULTS :


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SAFETY STOCK :


Safety stock is the stock held by a company in excess of its requirement for the lead time. Company hold safety stock to guard against stock-out.

Safety stock is calculated using the following formula :

SS = (Max daily usage – average daily usage ) x lead time

Lead time is the time which includes production lead time , transit time or in case if PM/RM not available then supplier lead time will be added.

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DELIVER (DISTRIBUTION RESOURCE PLANNING)


Distribution Resource Planning (DRP) :

DRP develops a projection for each SKU and requires :

Forecast of demand of each SKU

Current inventory level for each SKU.

Safety stock.

Recommended replenishment quantity .

Lead time for replenishment.

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DISTRIBUTION NETWORK ACROSS PAKISTAN


Handler (warehouse)

DISTANCES – KMBMWH – Multan : 935 KMBMWH – LHR : 1296 KMBMWH – FSD : 1164 KMBMWH – RWP : 1479 KM

WAREHOUSE CAPACITY :WH : CAPACITY / MAX (CARTONS)

Multan : 810 CartonsLHR : 3600 CartonsFSD: 1130 CartonsRWP: 1800 CartonsBMWH : 4000 Cartons

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TRANSPORTATION SYSTEM : RECOMMENDATION FOR FUTURE


The new transport system design works around improving efficiency/OTIF (On time-In Full)

Recognizes that transport cost is a factor of following :

Fixed cost : (cost of vehicle incurred per day )

Variable cost (cost incurred in motion per KM)

Vehicle loading/unloading times ( Reduce Idle time )

The only way to achieve savings in transportation is by weeding out the inefficiencies.

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FREIGHT CHARGING :


Freight Charging :

Journey times for every route will be fixed and agreed upon. This would constitute the fixed charge. The variable charge will be based on actual distance.

Vehicle reporting timeVehicle loading timeVehicle departure time

Vehicle reporting time Vehicle unloading timeVehicle departure time

Time and Date stamping at every station with receiving signature.

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WAREHOUSE :


Design Criteria :

Warehouse design criteria address physical facility characteristics and product movement.

Three factors to be considered in the design process are :

The number of stories in the facility

Height utilization .

Product flow

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WAREHOUSE : ( PRODUCT FLOW)


Product Flow :

Warehouse design should also allow for straight product flow through the facility whether items are stored or not.

In general , this means that product should be received at one end of the building , stored in the middle ,and then shipped from the other end.

Straight-line product flow minimizes congestion and confusion.

The elevator is also often a bottleneck in product flow , as use of elevators to move product from one floor to the next requires Time & Energy.

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THE WAREHOUSE IN THE LOGISTICS SYSTEM :


Function of warehousing include

Transportation consolidation Docking Service Protection against contingency Inbound Outbound Inventory tracking Labor management Dispatch/shipping Reporting

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WAREHOUSE :


Objectives of efficient warehouse operations :

provide timely customer service and maintain OTIF (on time-in full).

Keep track of items and maintain records so they can be found readily & correctly .

Minimize the total physical effort and thus the cost of moving goods into & out of storage.

Proper stacking and palletizing with Bincards .(visual and visible)

recommendation for future

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QUALITY (QCD)


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QCD (AIMS & OBJECTIVES OF QC):


1. Improvement of quality.2. Reduction of scrap and rework.3. Efficient use of 4M’s.4. Removing production bottle-necks.5. Decreased inspection cost.6. Reduction in cost per unit.7. Quality caution at all levels.8. Reduction in customers complaints.9. To check the variation during manufacturing.10.To prevent the poor quality product reaching to customer.

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QCD : (EXPECTED OUTCOME)


1. Improving the quality of products.

2. Increasing the productivity of manufacturing processes.

3. Reducing manufacturing and corporate costs.

4. Determining and improving the marketability of products.

5. Improving and / or assuring on-time deliveries and availability .

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QCD : CORRECTIVE ACTION


Must address nonconformity.

Must address root cause (s).

Should prevent re-occurrence.

Must be timely corrected.

Time scale must be realistic,

Action may be in three stages.1. Initial corrective action2. Longer term preventive action3. Continuous improvement plans.

The process of submission , evaluation and verification is known as “Follow-Up “.

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SUPPLY CHAIN DAILY ACTIVITIES & FOLLOW-UP


Procurement :

• Daily update SPJ status and follow-up to meet the delivery timeline.• Co-ordinate with planning to cater any upcoming shortage.• New design’s artwork updating.• Follow-up with suppliers to ensure on time deliveries of items.

Production Planning :

• Daily production plan.• Daily shortfall production report .( variance report)• Daily machine loading sku wise , capacity wise monitoring .• Material issuance (should be informed and issue MIN one day before for next day

plan.• Daily PM/RM/AM inventory review.• Production plan should be make on the basis of nationwide FGs requirement.

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SUPPLY CHAIN DAILY ACTIVITIES & FOLLOW-UP


Warehouse : (Materials Management)

• Daily update inventory reports (RM,PM,AM) @ 09:30 AM.• Monitor and ensure daily material issuance and receiving from suppliers .• Daily submission of GRN to finance department.• Proper house keeping and compliance as per quality standards.• Bincards updating of every item .• Proper stacking of any item on pallets with labeling. Distribution / Dispatch :

• Three days (3) dispatch plan should be in hand on the basis of NW WH requirement /demand.

• Daily monitoring of FG’s inventory levels and fulfill the demand within 5 days.• Timely communicate to planner for any special demand from regional WHs.

30Anticipating the customer’s requirement on continuous basis.

supply chain presentation bipl

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