An Analysis on Inventory Management at Whirlpool of India Limited, Puducherry

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  • Topic: Inventory, Washing machine, Inventory turnover
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  • Published : March 14, 2011
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AN ANALYSIS ON INVENTORY MANAGEMENT AT WHIRLPOOL OF INDIA LIMITED, PUDUCHERRY ABSTRACT

Every organization needs inventory for smooth running of its activities. It serves as a link between production and distribution processes. The investment in inventories constitutes the most significant part of current assets/working capital in most of the undertakings. Thus, it is very essential to have proper control and management of inventories. The purpose of inventory management is to ensure availability of materials in sufficient quantity as and when required and also to minimise investment in inventories. Raw materials, goods in process and finished goods all represent various forms of inventory. Each type represents money tied up until the inventory leaves the company as purchased products. Because of the large size of the inventories maintained by firms, a considerable amount of funds is required to be committed to them. It is therefore absolutely imperative to manage inventories efficiently and effectively in order to avoid unnecessary investments. A firm neglecting the management of inventories will be jeopardizing its long run profitability and may fail ultimately. The reduction in excessive inventories carries a favorable impact on the company’s profitability.

The study starts with an introduction to inventory management, Company’s profile, its Vision & Mission, Achievements and also the need for study, review of literature and objectives are set out for the study. Research methodology, Data analysis & Interpretation, Findings and Suggestions of the study follow.

One of the main areas of the project is the analysis part, where the data are analysed & interpreted, to find out how the inventories were managed. Some of the tools used in inventory are regarding to:

Economic Order Quantity
Safety Stock
ABC Analysis
FSN Analysis
Trend Analysis and
Inventory Turnover Ratio.
And then conclusions, limitations & scope for further study were discussed.

CONTENTS

CHAPTERTITLESPAGE NO.

LIST OF TABLES
LIST OF CHARTS

I
INTRODUCTION PROFILE OF THE COMPANY
NEED FOR THE STUDY1
2
15
IIREVIEW OF LITERATURE
16
IIIOBJECTIVES OF THE STUDY
31
IVRESEARCH METHODOLOGY
32
VDATA ANALYSIS AND INTERPRETATION
34
VI
FINDINGS OF THE STUDY,
SUGGESTION AND RECOMMENDATIONS
49
51
VIICONCLUSION52
VIII
LIMITATIONS OF THE STUDY
SCOPE FOR THE FUTHER STUDY
53
54
BIBILIOGRAPHY55

LIST OF TABLES

TABLE NO.
NAME OF THE TABLE
PAGE NO.

5.1.1
ECONOMIC ORDER QUANTITY
34

5.2.1
SAFETY STOCK
37

5.3.1
ABC ANALYSIS
41

5.4.1
FSN ANALYSIS
44

5.5.1
CALCULATION OF INVENTORY TREND
45

5.5.2
INVENTORIES PERCENTAGE
46

5.6.1
INVENTORIES TURNOVER RATIO & VELOCITY
48

LIST OF CHARTS

CHART NO.
NAME OF THE CHART
PAGE NO.

5.3.1
ABC ANALYSIS
41

5.4.1
FSN ANALYSIS
44

5.5.2
TREND OF INVENTORY
47

CHAPTER-I

1.1 INTRODUCTION

Inventory control is vitally important to almost every type of business, whether product or service oriented. Inventory control touches almost every facets if operations. A proper balance must be struck to maintain proper inventory with the minimum financial impact on the customer. Inventory control is the activities that maintain stock keeping items at desired levels. In manufacturing since the focus is on physical product, inventory control focus on material control.

“Inventory” means physical stock of goods, which is kept in hands for smooth and efficient running of future affairs of an organization at the minimum cost of funds blocked in inventories. The fundamental reason for carrying inventory is that it is physically impossible and economically impractical for each stock item to arrive exactly where it is needed, exactly when it is needed....
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