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Operational ManagementProject Report

Aamir Durvesh-(8962)Ahsan Ahmed-(7179)

Mujeeb Iqbal Naviwala-(7182)

Muhammad NomanKhan-(6504)

Submitted On:May 9, 2011

Monday-(3 :00 P.M. 6:00 P.M.)1


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Synopsis Product life cycle

Company Profile

Vision, Mission. Objectives

Company Quality Policy Company Environmental Policy

Legal Requirments

Analysis of Micro Environment Organizational Chart

Organizational Chart of Supply ChainDepartment

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Demand Management Suppliers Inspection of Material Bill of Material BOM Material Management Procurement Process Purification Process Water Manufacturing Process Product Categories Packaging Warehousing Distribution Logistics and Supply Chain Model

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Culligan is a mineral water company which will set upa water purification plant in S.I.T.E. Area Karachi.

They have started this company on the September 1,1997.

potential for growth at a steady rate of 6 % per annumand it is in the growth stage of its product life cycle. Water among the beverage industry holds a 4% share

while tea holds 55%. In the Political legal analysis of the industry we came

to know that there is consumer activism protestingagainst unsafe water supplied by 26 mineral waterbrands of Pakistan.

Under the economic analysis GDP has grown to 6.4%increasing the purchasing power of the consumer.

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There is a need for R&D in this industry as manyoptions for technological improvements areavailable.

There are legal requirements which specify howmany of chemicals and ingredients should bepresent in mineral water.

Raw materials consist of chemicals, plastic bottles,seals, caps, and mainly unpurified.

Our inventory stored will be of 2 months. competitors are mainly AVA, Fontalia, Aqua Fina

and Nestle.

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Mineral Water Industry is in its growth stage of life cycle. There is a lotmore that companies can do to make this industry more competitive.

Bottled water industry in Pakistan is still immature as there is only plainmineral water is available in the market. No offerings of sparkling,flavored or sweetened water is being done by any of the existing players.

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Culligan private limited has been formed onSeptember 1, 1997. This water purification companywill be catering to Karachis market for the time being.

Company is located in Karachi, Pakistan.

Major Bankers:

UBL

Standard Chartered

MCB Metropolitan

Sohneri Bank

My Bank

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Legal Advisor: Mr.Rahat Aziz

Registered Office & Factory:

Culligan Water Of Pakistan

F-17/A, Hub River Road , SITE, Karachi , 75700

General Information:

People Employed: 45-50 Land: 1.5 Acres

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Culligan Objectives

Constantly Endeavor to be a market leader in terms of marketshare & technology based pace setters in areas of operation & tocontinuously improve efficiency & competitive strength.

To offer customers quality products & support services atcompetitive prices & to their satisfaction

By continuously improving performance, aim to generate earningssufficient to ensure a secure future for the company & to protect &

increase shareholders return.

To enhance creativity & job satisfaction, provide employeesopportunity for personal development.

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Our policy is to satisfy by providing quality product bymeeting all the departments as per ISO 9001-2000,standard so that standard of quality meets therequirements of the company.

Our focus is on continual improvement for which wehave established our quality objectives that arecontinually received in Management Review Meeting.

Company Environmental Policy To discourage practices those cause damage to the

environment. To implement system which are environment friendly To encourage recycling and discourage wastage that

cause harm to the atmosphere

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The (PSQCA) was establishing under section 3 ofthe Act 1996.

The establishment of any mineral water plant inPakistan is required to get a license from (PSQCA).

An application on a prescribed application form,which can be obtained for Rs 100/- from (PSQCA).

The PSQCA has developed standards for bottledand mineral water and all the water plants.

Violation of the PSQCA is punishable byimprisonment for one year or a fine of Rs 50,000 orboth.

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The water should be free from all chemical and bacteriologicalcontaminations which are hazardous to health.

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Competitor Analysis.

There are around 26 players in bottled waterindustry.

Pakistan bottled water comprises of two mainsegments:

Retail Market. Bulk Market.

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0.5 Liter

1 liter

3 liters

5 liters

6 liters

Bulk Market.

3 gallons to 5 gallons cans.

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Zam Zam

Fresh

Musaffa

Mineral PlusWell green

Aqua Flow

Max Wellpur

HimalayaBrecon Carreg

Evian

Perrier

NiagraNestle PureAvaCulliganSparkletsMasafiAqua SafeCool

Ab-e-HayatRainbowPearlAskariSafa

ClassicBlue Ever Pure

JeemaVittelGulfaVolvicHighland SpringSPAHayatOsloVital

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The price range of 1.5 liters category is from Rs20-95 (including local and imported brands).

the price range for 0.5 liters category is from Rs

10-85 (for local and imported brands). The range for 5 gallon starts from Rs.60-95 per

bottle.

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Managing Director

Chief Operating Director Chief Executive Director

Marketing Director Operational Director Finance Director H.R Director

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Managing Director

Chief Operating Director

Operations Manager

Procurement Manager Warehouse Manager Production Control Expediting

Contract

Raw Material

Finished Goods

MRP

Outsourcing

Transportation

Documentation

Local

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The company has policy ofkeeping finished goodinventory on day to daybases.

The company will implementmethods for forecasting saleswhich will be provided byour marketing and salesdepartment.

Forecast Method: a properforecast has to be done toensure that there are nomishaps like the bullwhipeffect.

Requisition

Manufacturing department

Forecast of sales by marketing & salesdepartment

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We will keep 2 suppliers for every raw material and supplies. 2 months inventory will be purchased and maintained.

Unpurified water we will get from Muslimabad Hydrant.For 5 gallon cans: The cans will be screen printed with Culligan label. Delta Waters Kasim BrothersFor caps and seals 2 suppliers: Tanzeela Quality Suppliers

For chemicals such as (calcium, magnesium, sodium and salt) Merck Javed Chemicals

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The following is a list of our raw materialsneeded for the purification of water.

Unpurified water

Empty water cans (5 gallon) Caps

Seals

Chemicals (calcium, magnesium, sodium andsalt)

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The suppliers will bring the rawmaterials by their owntransport. The inspectionprocess will be as such.

Materials received

materials inspected into thecartons materials verified with the

amount required if all the materials are as per

requirement the receipt willbe given to the supplier Payment will be made to the

supplier within 30 daysperiod.

Material Received

Material Inspected before

receipt

Material verified with the

amount required

If all materials approved

receipt will be given to the

supplier

If materials are notsatisfactory they will be sent

back to the supplier

Payment will be made in

30 days period

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Bill of Material: (BOM)

Purified BottledWater

UnpurifiedWater

Empty BottleCaps &Seals

Chemicals

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Material Requisition

Procurement Department

Request for Quotation

Selection of Supplier

Purchase Order

Receiving & Inspection

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The first step for setting up a water purification plant isthe analysis of source of water. After the chemicalanalysis, the specifications of the purification plant areset.

Source water is stored in the feed water tank, passes

through the sand filter for preliminary water filtration. Water then passes through the dosing pump-I where

chlorine is added to kill the germs.

After the chlorination, water passes through carbon

filter. It helps in the maintenance of proper odor andtaste of the water.

Water is then passed from dosing pump-II, whereSodium Meta Bisulphate is added.

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Water is filtered next and passes through dosingpump-III, where anti scallant is added.

Water then passes through reverse osmosismodule. This stage of the process makes water

clear from all the contaminations. Water then passes through dosing pump-IV,

where minerals are added for taste development.

water undergoes Ultra Violet treatment to avoidany contamination from bacteria.

The water then passes through Ozonator to furtherkill the germs.

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Water then passes through automatic washing,filling and capping plant.

Here water is filled into bottles.

Capacity: 5000 bottles a day

Actual Bottles: 3000 bottles per day

Reverse Osmosis Plant atCulli an

Washing, Filling & Capping Plant 29


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Every day there are3000 bottles filled soout of those randombottles are picked totest the water in thechemical and microlabs.

They are tested to seethe ratio of chemicals

is according to thestandards. The quality is checked.

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Ideal for you when you are on-the-go andfor the kids lunch boxes

Is presented to customers particularly inrestaurants and cafs or on your table orin your bag ... Always with youeverywhere!

Ideal for picnics & parties anywhere!

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For home and office use.

For home and office use.

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Product packaging and presentation is one ofthe main dynamics.

It is suggested that the Bottles should be clear.

The bottle should give a reflection of light skyblue color, which is considered a naturalsymbol of the water.

The water should give a shiny and a glossy

reflection. The opening of the bottle should be large

enough to accommodate outflow and inflow ofwater.

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Water Specifications

Certificate mark of the Pakistan Standards &Quality Control Authority

Expiry Date (Best Before Date) A brief intro of the company with address

Website address of the company

Brand Name / Trade Name

Net volume in System International / MetricSystem

Batch Number or code number

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Culligan will have only one warehouse which willbe inside the factory at the back side.

It also have an inventory storage area.

The size of the warehouse will be: 5000 sq ft. Length & width 70 ft. (this size includes the plant,

warehouse and the inventory storage area).

Raw Materials:

The raw materials will be stored in the inventorystorage area at the back side of the warehouse.

There will be a 2 months inventory in our store.

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The finished goods will be kept in thewarehouse for less than 12 hours.

As the trucks can load up to 200 bottles each

they will make the delivery after the bottleshave been packed and arranged.

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Mode of Transportation: Road: Raw material.

Trucks and Wagons will be the mode oftransport for raw materials.

Transportation of raw materials to the factorywill be the responsibility of the supplier.

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Culligan Pvt Limited will have its own distributionnetwork.

Status: In house distribution Road: Finished Goods

Trucks: Hyundai Shahzore Suzuki Pick up Mazda TruckUnits carry: Suzuki pick-up can carry 60 bottles of 5.0 Gallons Hyundai Shahzore can carry 120 bottles of 5.0 Gallons Mazda trucks can carry 200 bottles of 5.0 Gallon

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UNPURIFIED

WATER

Muslimabad hydrant

EMPTY WATER CANS

5.0 GALLONS

Delta waters,KasimBrothers

CAPS AND SEALS

Tanzeela and QualitySuppliers

CHEMICALS

Merrcck andJavaid Chemicals

RAW MATERAIL SUPPLIERS

FACTORY RAW MATERIALWAREHOUSEWATER

STORAGETANKS

PURIFICATION PLANT

FINISHED GOOD WAREHOUSE

LOADING OF BOTTLES ONTRUCKS

CUSTOMERS

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