A study on inventory management at the bulk activities division of Dr. Reddys Laboratories Ltd
- Objectives of the study.
- Need for the study.
- Scope of the study.
- Company profile.
- Inventory management.
- Types and classification of inventory.
- Need for inventory control.
- Valuation of the inventories.
- Purchase and stores procedure.
- Issue pricing methods.
- Techniques of inventory management.
- ABC analysis.
- Economic order quantity.
- VED analysis.
- The re-order level.
- Safety stock.
- Just-in-time inventory.
- Graphs included.
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 for. Proper control over material can make a substantial contribution to the efficiency of a business. The success of a business concern largely depends upon efficient purchasing, storage, consumption and accounting.
Bulk Drugs is the back bone of Pharmaceutical industry and inventory plays a vital role in bulk drug industry hence the study of Inventory Management in Bulk Actives division of Dr Reddy has been selected for the project.
The data has been gathered through interaction and discussions with the executives working in the division. Some important information has been gathered through a couple of unstructured interviews of executives.
This study provides an insight into the management of High Value items and also draws the attention of the management towards movement of ?A' class items over period of 4 years.
[...] REDDYS LABORATORIES LTD BULK ACTIVES DIVISION TOTAL INVENTORY TREND: * Rs In millions INVENTORY Stores & Spares (at Cost*) Raw Material (at Cost*) Work in Process (at Cost*) Finished Goods (at Cost*) TOTAL TYPES OF INVENTORIES: Inventories play a major role in a business or company depending on nature of the business. The inventories may be classified as under, Raw materials. The raw materials include the materials, which are used in the production process, and every manufacturing firm has to carry certain stock of raw materials in stores. [...]
[...] ABC Analysis at Bulk Actives Division: Raw MATERIAL (at Cost*) * Rs In millions Interpretation: The Ratio increased to 4.21 in 2004-05 from 4.18 in 2003-04, implying there was a consistent and good management control. Being a Pharmaceutical company, generally the inventory turnovers will be high FINDINGDS OF THE STUDY Area Observation Findings Total Inventory Presently company There was good coordination maintains adequate between the Marketing, inventory turnover planning, procurement, ratio as a production and distribution pharmaceutical functions of DRL, higher company it exhibits inventory turnover was good signs. [...]
[...] The operation of a system of perpetual inventory so that it is possible to determine at any time, the amount and value of each kind of material in stock. A suitable method of valuation of materials is essential because it affects the cost of jobs and the value of closing stock of materials. Objectives of Inventory Control: The main objectives of inventory control are: I. To maintain a large size of inventory for efficient and smooth production and sales operation. [...]