Supply Chain Manaement

SUPPLY CHAIN MANAGEMENT NIRULA’S BY GROUP 1 SIRAJ /151  NIHAREIKA /91  ISHA /83 

History & Backround       

The organised retail food market is worth Rs 2,500 crore (Rs 25 billion) per annum and is growing at 25 per cent. Nirula’s opened its first quick service restaurant in 1977 Also have Bars, pastry shops, ice-cream parlours and business hotels besides a salad bar and coffee shop The company has more than 64 outlets — a mix of restaurants, delivery outlets and ice-cream parlours. Its condiments division and the products are sold in 1,600 outlets under the Nirula’s brand name. Nirula’s also owns three 3-star hotels in Delhi, Noida and Panipat with a total of 107 rooms and expanding rapidly. Have a different brand identity and first mover advantage. Thali is a special feature.

COMPETITIVE EDGE – BACKWARD // SELF PRODUCTION     

The chain runs its own production centres. Food production and processing are done in-house. Its dairy plant takes care of the icecream and cheese Breads, cookies and savouries are produced at the Nirula's bakery. Other products manufactured out of Nirula's own units are sauces, syrups, ketchup, jams and mustard.

STRATEGIC PLANNING   

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A rough investment of Rs 100 crore Add another 100-150 outlets to build a pan-India brand The company would outsource its food products to Sky Gourmet, an airline catering company, in which the Malaysian firm Navis Capital Partners holds a majority stake. The fast food chain has tied up with Indian Oil Corporation to open its outlets in IOC's petrol pumps. It is also planning to extensively roll out its ice-cream kiosks around the country alongside expanding its dine-in format. The company also expands via the franchisee route but is cautious to maintain quality too.

Supply chain history      

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Lack of funding & interest-2001 No business intelligence model in supply chain system posing serious problems in management of large logistics -2002 Nirulas has been witnessing declining sales, a drop from roughly 67 per cent to 20 per cent.-2003 Snowman India, a subsidiary of Mitsubishi Electric, handle its integrated food supply chain management .-2003 Still supply chain that can squeeze costs, supply standardized food and yield profits at low prices required -2005 Nirula's was recently acquired by Mr Kuckreja and Navis (a Malaysian private equity firm ) & invested to enhance its back-end supply chain. . (2008-09) Nirula’s adds SAP to streamline SCP(Supply chain processes).

Government boost 2009 – cold storage 

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Restaurants like Nirula’s stand to benefit from the incentives given to cold storage and refrigeration companies in this budget to develop infrastructure for transporting agricultural produce. Nirula’s restaurants follow cold chain systems for their icecreams and other temperature -sensitive products. More investment allows access to more facilities, thereby ensuring better product handling and transportation.” To build such facilities the budget proposes to-“To build and operate such facilities can be fully treated as deductions for tax”. 5-7 per cent of the total operational cost goes into managing cold storage units. Eventually the costs will come down which will reduce their transport and logistics cost.

SAP & benefits by - Zensar-OBT Technologies     

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The creation of the online platform has given Nirula’s greater visibility in cash flows from procurement to sales. Have increased clarity into food preferences across each of our restaurants. Can stock our restaurants suitably and drive promotions accordingly at each outlet, (inventory control) Successful in gaining vendor loyalty. Enabling greater enterprise wide visibility, improved operating margins, and process transparency whilst strengthening partner relationship. Fast, profitable, streamlined ,reliable, accurate ,informed and waste free control of SCP. increase operational efficiency, coordinate global supply chains, and modernize their warehouse and logistics functions

NEW SUPPLY CHAIN MANAEMENT  

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The outlets can order online thus drastically reducing order processing time. The managers can monitor various kinds of reports (Productions reports, stock status reports, exception report etc.) of all the production units from a single window. Based on historical data, the production units start their daily production keeping in mind special days (Sundays, Festival, etc) and extra-occasional orders. The system automatically calculates the raw materials requirement for each production floor based on production of each item's recipe. This raw materials requirement is sent to raw materials store.

CONTINUED…… 

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Items are then issued for production. Batch-wise monitoring of production process is done based on production charts, plant capacity and shifts. Items produced are issued to various restaurants (outlets) based on their online orders. The system generates invoices for the outlets based on orders received from them. Van Scheduling and Monitoring improves their logistics and delivery handling. The system helps the Quality Department to maintain its records more efficiently, monitor and control quality during procurement, production, storage and dispatch.

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