A Report on Corporate Exposure Learning at Kamadhenu Coconut Industries

Submitted By Mr. Navaneeth (4NM11MBA87)

Under the Guidance of

Internal Guide Prof.Sandhya Rao Assistant Professor Justice K. S. Hegde Institute of Management Nitte

External Guide Mrs. Subha N Partner Kamadhenu Coconut Industries Kundapura Udupi

Submitted in partial fulfilment of MBA course to N.M.A.M. INSTITUTE OF TECHNOLOGY (An autonomous Institute under VTU, Belgaum)

Department of Studies in Business Administration (Justice K.S. Hegde Institute of Management) NMAM Institute of Technology, Nitte OCTOBER 2012

CERTIFICATE
This is to certify that Mr. Navaneeth is a bonafide student of Master of Business Administration Course of our Institute affiliated to Vishweshwaraya Technological University, Belgaum. This report on, Corporate Exposure Learning at Kamadhenu Coconut Industries is prepared by her under the guidance of Prof. Sandhya Rao, Assistant Professor, Justice K.S. Hegde Institute of Management, in partial fulfilment of the requirement for the award of the Degree of Master of Business Administration of Vishweshwaraya Technological University.

Place: Nitte Date: Place: Nitte Date:

Head of the Department Business Administration

Principal

Valued by Sl. NO 1. 2. Name of the Examiner Signature Date

CERTIFICATE BY THE GUIDE This is to certify that the CEL Report on Corporate Exposure Learning at Kamadhenu Coconut Industries is prepared by Mr. Navaneeth (4NM11MBA87) in partial fulfilment of the requirement for the award of the degree in Master of Business Administration as per Visvesvaraya Technological University under my guidance and supervision. This is also to certify that this CEL report has not been submitted to any other institution or university for procurement of any degree or diploma.

Place: Nitte Date:

Prof. Sandhya Rao (Internal Guide) Justice K.S. Hegde Institute of Management Nitte

DECLARATION I hereby declare that this project report entitled Corporate Exposure Learning at Kamadhenu Coconut Industries is the result of my original work under the guidance of Prof. Sandhya Rao, Assistant Professor, Justice K.S. Hegde Institute of Management, Nitte, in partial fulfillment of the requirement for the award of Master of Business Administration (MBA) degree of Vishweshwaraya Technological University. The Project Report has not been submitted before to any other University or institution for the awarding of any degree or diploma.

Place: Nitte Date:

(Navaneeth)

Acknowledgement

This project bears the imprint of many persons without the help of whom, I would not have been able to fulfill the task. First and foremost, my sincere thanks to Prof Sandhya Rao, Justice K.S.Hegde Institute of Management whose valuable guidance has enabled me to complete this study. Its my pride and privilege to thank Director, Dr. K. Sankaran, Justice K.S.Hegde Institute of Management, Nitte for letting me as a part of this prestigious college and for all the help and assistance extended to me during the course of my study in the college.

I am always thankful to the Managing director and staff of Kamadhenu Coconut Industries for providing me with necessary information, assistance and support required in the preparation of the report.

Table of Contents

CHAPTER 1

TITLE INDUSTRY PROFILE Food Process Industry in India Coconut Industry in India Recent Changes in Coconut Industry Challenges faced by the industry

PAGE NO 1-7 1 3 5 7 8-15 9 9 10 10 10 10 10 11 11 12 15

COMPANY PROFILE Background Inspection of the company Nature of the Business Vision, Mission and Quality Policy Product and Services Areas of Operation Ownership Pattern Competitors Information Infrastructural Facilities Achievements/Awards Work Flow Model Future Growth and Prospects

7 S MCKINSEYS Framework Structure Skill Style Strategy System Staff Shared values

16-22 17 18 19 19 20 21 21 23-26 23 24 25 25 27-32

SWOT Analysis Strength Weakness Opportunities Threats

Summary of Annul Report and Financial Analysis

Learning Experience Annexure Bibliography

33-37

List of Tables 5.1 - Table of Fixed asset and Sales along with its Fixed asset ratio. 5.2 Table of Sales and Capital invested along with its ratio. 5.3 - Table of Sales and Debtor + Bills receivable with its ratio. 5.4 Table of Sales and Avg. Current asset with its ratio. List of Graphs 5.1 - Graph of Sales and Fixed asset. 5.2 - Graph of Sales and Capital invested. 5.3 Graph of Sales and Avg. Current asset.

Executive Summary
India is a developing country where industries play a very important role in the economic development of the country. There are many industries which mainly depend on the agriculture for their raw material needs such as sugar, jute, textile, handicraft, paper, vegetable oil, rice industry, coconut industry etc. There are lot of problems and challenges faced in these industries for making a profitable business. The Indian food market is approximately Rs 2,50,000 crore ($69.4 billion), of which value-added food products comprise Rs 80,000 crore ($22.2 billion). Despite food production in the country that is expected to double by the year 2020, not much attention has been given to the growth of this vital industry, with no standard publication highlighting the importance of this sector. The objective of this study was to know the market standing of Kamadhenu Coconut Industries in terms of financial position and good will. It is also aimed at studying the response of the company to the suppliers and customers problems. To understand the rapport of the company with the suppliers and employees. In addition to this it is also intended to understand the buyers behaviour and their expectations from the Company when it comes to selling of a particular product. It is also intended to study the policy of the company along with its strategy in selling of the products. In addition to this the areas have been noted where the company can give emphasis due to which there can be a substantial increase in the output as well as the customer interaction. It may also help in quick and efficient ordering and delivery process. The SWOT and McKinseys 7s Frame work model was analysed on the Firm so as to get a better insight into the Firms performance and the improvements that can be focused on for higher profit margin. It also helped in analysing the strengths and opportunities compared to its competitors.

The technique employed for this study was that of primary data collection. All the employees and the company management were consulted in this regard, and all the required information was collected from them. The companys financial data was studied and analysed, based on the data , the liquidity position and the financial position of the company are determined. This gathered information about the company helped in analysing the goodwill and the activities conducted by the company regarding CSR. In addition to that it helped in getting the required information regarding the company profile. The data collected also gives the problems faced by them and the solutions they found. This study also showed the various problems that the

industry and the Firm in particular is currently facing and may face in the future. It showed the true picture of how difficult it is to start a Firm in the rural area and make it a profitable venture.

Chapter 1 Industry Profile

INDUSTRY PROFILE
India is a developing country where industries play a very important role in the economic development of the country. There are many industries which mainly depend on the agriculture for their raw material needs such as sugar, jute, textile, handicraft, paper, vegetable oil, rice industry etc. With the overwhelming successes of the Green and White Revolutions, India is now fervently poised for the Food Revolution that will ensure agricultural diversification and large investments in food processing. The entries of multinationals, aggressive rise of commodity branding and low cost of technology are changing the economics of the Indian food industry. The rise of aggressive regional players making forays into categories where entry barriers are low and a boom in Indian FMCG markets and the rising need for these products are the key reasons for this growth in food business. Indian agriculture is in the throes of a paradigm shift, thanks to the structural changes in the Indian economy. With the country achieving self-sufficiency in grains production, emphasis has changed from subsistence farming to commercialization, opening up vast opportunities for value-addition, packaging and exports, with a strikingly high level of technological involvement. The holistic concept of food security, however, has two dimensions availability of food and access to food. While the former has been achieved, the same is not the case with the latter. Despite bumper crops, distribution of food grains continues to be faulty almost 30% of the food produced in the country is wasted. In such a scenario, it is important to reorient historical agricultural policy framework from managing shortages to promoting efficiencies and value addition. Moreover, there is a need to increase the range of foods available to improve overall nutrition. The benefits in terms of health, vitality and productivity are obvious, and cannot be underestimated. Food Processing Industry in India The Indian food market is approximately Rs 2,50,000 crore ($69.4 billion), of which valueadded food products comprise Rs 80,000 crore ($22.2 billion). Despite food production in the country that is expected to double by the year 2020, not much attention has been given to the growth of this vital industry, with no standard publication highlighting the importance of this
Page | 1

sector. The food industries include food processing, bakery, confectionery, dairy, meat & poultry, fruits & vegetables, fisheries (including aquaculture), food ingredients, grocery retail, packaging, alcoholic beverages, soft drinks and bottled drinking water, canning, fats and oils, filters and filtering materials, flavours and flavour enhancers, nutrient additives, frozen food/refrigeration and thermo processing, among others. With food production expected to double by 2020, large investments are already going into food and food processing technologies, skills and equipment. The issues and events in this sector, are mentioned below.

The food processing industry is witnessing a 20% annual growth rate and, consequently, the demand for processed foods and beverages in the country is constantly on the rise. There are 300 million upper-and-middle-class consumers of processed and packaged food in the country.

Processed foods are primarily derived from agricultural commodities, which often incur multiple taxes at various stages. This multiple taxation has a cascading effect on prices. Moreover, there is a wide variation in the level of taxes across states, which creates a barrier to the free flow of materials from the farm to the factory and ultimately to the consumers.

Post-Green Revolution, it is essential that agricultural research reoriented to address new challenges. As the existing crop seeds have reached yield saturation, there is an urgent need to evolve transgenic varieties through the application of biotechnology, RNA use, and molecular biology. These varieties should have high yield, short maturity, pest and disease resistance, stress tolerance, and wider adaptability.

With the help of indigenous breeds improvement programme, nutritional research and improved cost-effective vaccine programmes, India has achieved the distinction of being the highest milk producing country in the world. Similarly, with processes in place to improve quality of marine products for internal and export markets, India is the seventh largest producer of fish in the world and is ranked second in inland fish production.

Special foods are available for every patient today, be it hypertension, diabetes, obesity, or even weight reduction. For instance, diet food and nutraceuticals are the latest fad. The market for sugar-free confectionery and snack products is growing steadily. Motivated by a desire for maximum indulgence coupled with a wish for
Page | 2

calorie control and health benefits, consumers are increasingly choosing sugar-free and sugar-reduced products.

Packaging of food products has become important in order to ensure safety and hygiene and to eliminate the possibility of adulteration. In some cases, more than 50% of the price of a product goes towards packaging. Good packaging will greatly catalyze the development of a food-processing sector. However, packaging industry is yet to achieve international standards in the country.

Coconut Industry in India

The coconut crop is grown in 12.5 million hectares of land which constitutes about 0.7% of net crop area of the world. The crop is grown in the coastal lowlands of continental south Asia and spread along the Indian and Pacific Ocean. The cultivation is mostly done by small and marginal farmers. According to FAO statistics 2007, about 57.9 billion nuts were produced, which was equivalent to 7.3 metric tonnes of oil. The coconut oil ranks sixth among the eight major vegetable oils of the world. India contributes about 15.46 % in area and 21% in terms of production of coconut in the world. The coconut crop is grown in eighteen States and three Union Territories covering an area of 1.935 million hectares of land, with a production of 12,833 million nuts in the country. The major coconut crop acreage is concentrated on the West Coast region of the country comprising the states of Kerala, Karnataka and Maharashtra, followed by East Coast of Tamil Nadu, Andhra Pradesh, Orissa and Pondicherry. The coconut cultivation areas are also traditionally located in the coastal region of Gujarat, Goa, West Bengal, Islands of Andaman & Nicobar and Lakshadweep. About 90% of the area of coconut cultivation and equally the same percentage of production of coconut are from the four southern states, viz. Kerala, Karnataka, Tamil Nadu and Andhra Pradesh. Kerala is considered as the land of coconut and holds the key for the development of coconut production and marketing in the country.

In the present scenario, the trend in processing of coconut products is slowly setting in the country, but the domestic market is not ready to lift the coconut in product form. Moreover, the coconut processing industries have to compete with the international market players in the world market. Consequent to the globalization of Indian economy, the domestic coconut market economy has also been pushed towards a situation of competition, where coconut oil had to compete with the other low price vegetable oil and fats in the international market. In
Page | 3

spite of the changes in international and domestic market, the price of coconut oil has been steadily increasing since 2002, and reached to record level of Rs.7224 per quintal at Kochi market. The price of milling copra in Alleppy market was also recorded at the premium price of Rs.4893 per quintals and the price of ball copra was at Rs.7500 per quintal in Tiptur market in the month of December, 2004. This favourable market behaviour appeared to have been due to culmination of concentrated efforts of the implementing agencies, developmental policy of the Government to provide minimum support price to copra and coconut oil and the future trade.

Karnataka accounts for 15% of area under coconut cultivation and 10% of total production of coconut in the country. Coconut is the second largest and important horticultural crop of the Karnataka state, occupying 31% of the total area under horticultural crop. The crop is grown in all the districts of the state. The total area under coconut in the state is around 3.33 lakh hectares and the annual production of coconut is 1754 million nuts. The productivity of coconut in the state is considered as lowest when compared to the other neighbouring states.

Nearly 60% of the coconut produced in the state is utilized as raw nuts for domestic culinary purposes, social cultural and religious purposes. About 25% of the nuts are converted into edible ball copra, desiccated coconut powder and the remaining 15% is utilized as tender coconut for drinking purpose. Prominently, 6070% of the arrival of coconut is sent to other states i.e. Uttar Pradesh,Punjab, Maharashtra, Rajasthan, Madhya Pradesh, Jammu & Kashmir, etc., about 60% of coconut production in Karnataka is used in domestic items and remaining is dried as copra, most of the copra arriving to the markets is dispatched to other states, where the Karnataka copra is in great demand. The coconut utilized for commercial product preparation is only to the extent of 35-40%, while 55-60% is consumed for food and beverage purposes. Milling copra continues to be the major coconut product in Mangalore market. Whereas Arisikere and Tiptur markets cater to the ball copra which is sent to north India. Maddur market is mainly trading the tender coconuts which are sent to other states for consumption of tender coconut water.

The trade in tender coconut in the state is very popular, as tender coconuts have fairly good demand in most of the cities apart from the demand from the upcountry buyers. It has been observed that along the busy state highways and national highways like Bangalore Mysore, Bangalore Pune, etc, temporary retail sales outlets for tender coconut have been established
Page | 4

at different points to meet the demand of tourist and other travellers. A large number of cycle hawkers are also involved in the retail selling of tender coconuts. Tender coconuts of Tiptur Tall variety is normally used for this purpose.

The coir industry is an important cottage industry in the rural areas of the State, providing gainful employment to many villagers. There are 330 units registered with coir board, manufacturing coir products in Karnataka which are located in Tuymken, Chitoradnya, Bangalore, Hassan, Mandya. Out of these 330 units, 50 units are fibre extraction units, 30 units make curved ropes and 30 units make yarn, remaining units are manufacturing coir products.

Major coconut production in the country primarily is in demand from consuming states for traditional products viz. matured nuts, tender coconut water, coconut oil, desiccated coconut, oil cake and coir products. Nearly 90 percent coconut production is directed for traditional use in domestic markets. The most important traditional commercial product traded in the country has been the coconut oil. Therefore, the demand and supply of this single coconut product determines the price of raw coconut. Moreover, the market share of coconut oil both in domestic and export market is declining due to tough competition, especially from palm and soybean oil prices. Diversification efforts made by coconut oil industries have yielded limited success. In the process of diversification and product development, to bring new coconut products in the market, strategic market research is essential. Besides, coconut oil and oil cake, the coconut processing industry traditionally has been confined to copra production, manufacture of desiccated coconut, coir and coir products only. Because, the coconut processing sector remained confined to these traditional products, it has been observed that inspite of commendable achievements made in enhancing the production and productivity of coconut, the processing sector could not make much progress in the direction of diversification and value addition to coconut products. The processing determines effective utilization of harvested produce and the quality of the end product, which ultimately affect the consumption and acceptance of the product.

Recent Changes in Coconut Industry

With the advent of modern technology and for faster development of coconut sector in the country, product diversification, value addition and by-product utilization have gained
Page | 5

importance. To create demand for new products and by-products in domestic market, and to ensure their supply throughout the year. Further, the cost of production of the traditional coconut products in the country has been so high that price wise, the Indian coconut products are less competitive in the global market. Its contribution to export market has therefore been insignificant except the coir and coir products.

In the process of diversification and product development, more than 50 value added coconut products have been developed in Asian and Pacific countries for domestic as well as export market. Though actual data about these products could not be obtained, some of the important products which have received consumer acceptance in the country are coconut cream, coconut milk, coconut water and nata-de-coco which has also gained expanded market in Philippines and Indonesia. Pre-packed tender coconut water in sachet is produced by number of countries and has gained popularity. Philippines is even producing and exporting cocochemicals viz. fatty alcohol, fatty acids. These products could be promoted for wider and global acceptance through concerted efforts and aggressive market strategies by APCC countries.

The marketable value added products includes packed tender coconut water, coconut milk and milk based products, coconut chips, coconut based dairy products, desiccated coconut, coconut water based products, snowball-tender-coconut, vinegar, coir based products, coconut shell and coconut wood based products. Other products, which are being subjected to research and development, are organic food, oleo chemical, bio-diesel, bio-lubricant and cosmetics. Some of these products viz. coconut milk, coconut cream, spray dried coconut milk powder, vinegar, packed tender coconut water, snowball-tender- coconut and virgincoconut-oil have been produced on commercial scale. Besides, coconut biscuits, coconut chips, coconut based sweets and coconut chutney like traditional convenience products, using indigenous technology were already in the market. The Government of India, through the Coconut Development Board made strategic efforts and motivated entrepreneurs industrialist and artisans to exhibit their products in national and international trade fairs and exhibitions, to get better access to up country markets. Coconut shell and wood based products viz. handicrafts and utensils certainly have aesthetic utility and value. It has been observed that these products have good demand for export too.

Page | 6

Challenges faced by the industry

The following are the major problems faced by Indian coconut industry: Low farm productivity due to mono-cropping practice, poor genetic makeup and nutrient deficiency of the soil, etc. Post-harvest losses due to quality deterioration of copra in storage and transport, insect infestation, poor copra making practices and lower oil recovery due to harvesting of immature nuts. As per the survey conducted by Department of Agriculture, Kerala Agriculture University and the Central Plantation Crop Research Institute, the annual loss due to mite infestation in Kerala alone is estimated at Rs 5000 million. Kerala is the major coconut producing state, accounting for about 45 per cent of total production. Price instability due to increasing competition from substitute oils especially from palm and soybean both at the domestic and international markets. Relative unremunerativeness of coconut farming being a predominantly monocrop. Tenurial arrangement as a hindrance to increased investment in coconut culture. Decline in coconut hectarage due to land conversion into commercial and industrial purposes.

Page | 7

COMPANY PROFILE

Name

: KAMADHENU COCONUT INDUSTRIES : 13th March 1994

Date of Incorporation

Founder

: Mr. K. Govind Rao

Present Managing Director: Mr. K. Nagaraj Rao

Location

: Haladi Road, Koteshwara-576222 Kundapura Tq., Karnataka.

Employee Strength Male Female : 35 : 30

No. of Products

: One

Product

: Desiccated Coconut Powder

Bankers

: K.S.F.C State Bank of India Corporation Bank I.C.I.C.I Bank

Page | 8

a) Background and Inception of the Company Kamadhenu Coconut Industry is established by Mr. K. Govinda Rao on 13th March, 1994.It was inaugurated by Mrs. Manorama Madvaraja, former MLA,Udupi. Industrial location of Kamadhenu Coconut Industry is opposite to industrial area. It is 1km away from Koteshwara. This industrial plant is located in one acre of land.

The initial investment on the plant and machinery was Rs. 15 lakhs out of which 75% was provided by K.S.F.C. as loan and rest 25% from land and property. This industry is covered over an area of one acre land whose value is estimated to be Rs. 4 lakhs, which is owned by proprietor Mr. Nagaraj Rao. On 10th April 1998, ownership of the industry was transferred from Mr. K. Govind Rao to his son Mr. K. Nagaraj Rao. He then transformed this company to partnership firm; he has taken his wife Mrs. Shubha as a partner of the industry. They share the profit in the ratio of 1:1. Mr. Nagaraj manages the firm and he is paid the remuneration as a working partner cum manager for his work.

This industry has three main departments namely machine department, production department and finance department. This industry has 8 office staff, 5 supervisors, 12 machine operators and 42 labours working for the factory. The strength of labour has increased from 20 to the current strength of 65 over the years. Over the years, the facilities and the infrastructure facilities has been improved in the company and more and more trained and efficient labours are being recruited to better the productivity and efficient managing of the firm.

b) Nature of Business Carried Kamadhenu Coconut Industries looks after the diversification of product along with marketing scope. Marketing scope of industry is at outside Karanataka and north India where the availability of raw coconut is very rare. The products produced in the company are used for domestic purpose, for day to day consumption and for business i.e. for bakery product, dry food etc. The main industrial customers are Parle,Britannia, Ravalgon,Barrys etc. The local sale is done at the site of the company. The outside orders are received by phone, Fax etc. These orders are delivered by hired Lorries and through professional courier and DTDC courier etc. The company takes the liability for the damages occurred during the transportation.

Page | 9

c) Vision Mission and Quality Policy The Company is bound to produce and provide quality products for the utmost satisfaction of its employees and its customers. The Company aims at improving the living conditions of the employees along with the society it is situated in. The Company has provided clean drinking water, clean and hygienic work place, housing facilities, vehicle facility etc. for its employees. The Company has contributed to society and welfare of the people living around it in various forms such as giving funds in the form of sponsorship to various competitions, Sports, Games, and educational Purposes etc.

d) Products/Services Profile The product produced by the company is pure white desiccated coconut powder. They also produce the by-products such as coconut shells, coconut husk and waste copra. Most of the by-product is disposed off in the local market. Only the desiccated coconut powder has high demand in north India and major MNCs when compared to the local market. The orders are received through fax, telephone or mail while the delivery is done on time through the delivery trucks or through courier for small orders.

e) Area of Operation The marketing width is too much in north India when compared to local area .This is mainly attributed to the fact that the raw materials are abundantly available in local market when compared to north India. The Company is wisely using this opportunity for their advantage. The company supplies 90% of the desiccated coconut power to north India and 10% to the local market. The main marketing places are Mumbai, Delhi, Gujarat, Rajasthan etc.

f) Ownership Pattern When the company was incorporated, it was single ownership, later in 1998 the ownership was split between two people namely Mr. K. Nagaraj Rao and Mrs. Shubha, his wife, for profit sharing purpose. They share the profit in 1:1 ratio and Mr. K. Nagaraj Rao who is the working partner, well receives the remuneration for the same.

g) Competitors Information

The firm is facing competition from local coconut industries which produce similar products. The major competitors are Ganesh Kalpatharu Coconut Industries, Swastik Coconut
Page | 10

Industries and a firm by Mr. Prabhakar Naik. These firms are located in Kundapura and Udupi Tq. Ganesh Kalpatharu Industry was incorporated in 1982, it was the parental company of Kamadhenu Industry before the split took place in 1992. The working style and the methods of production are similar to that of the Kamadhenu Industry as both had same management practices previously. They pose serious threat to the labour turnover in the region and they have the intention of dominating the entire industry in the region. The second major competitor is Swastik Industry which was established recently and also has the same production capacity as Kamadhenu Industries. All the three firms are situated in close proximity and all these firms have the advantage of being near NH 66 which is the main connecting highway for Mumbai and other north Indian places. As these firms are located close to each other, the labour migration from one firm to another has increased over the years which have become a major problem in this part of the region.

h) Infrastructural Facilities Industrial location of Kamadhenu Coconut Industries is opposite to the Koteshwara

industrial area. It is kilometre away from Koteshwara city and NH 66. This firm is located on one acre land and has good road, water and power supply facilities. The other facilities which are provided by the firm are clean drinking water facility, clean and hygienic work place for its employees. It also provides safety measure and housing facilities for its employees. It provides them with pick up and drop facilities along with rest room in the firm for male and female workers separately. The firm has a good contact with transport agency for supplying its finished products to its customers and also to get the raw materials from the supply location. The Firm also has well maintained godown facility for storing the raw materials and finished products. The firm also has separate phone lines and fax lines for receiving the orders through phone and fax. The financial accounts are maintained in computers and the production process are mechanised and modernised for the safe and efficient production.

i) Achievements/Awards The Firm has been involved in many CSR activities in a local level for which its managing director has been recognised and awarded by the local authorities, which inturn has helped to the improve the goodwill of the Firm at the same time has brought in feel good factor in the employees.

Page | 11

j) Work Flow Model

Raw Coconut

Husk Removal

Shell Removing

Peeling

Washing

Crushing

Drying

Shifting

Weighing

Packing

The workflow model of desiccated coconut powder production involves several stages, out of which a few stages require the aid of machines and rest has to be done manually. The major steps in production of desiccated coconut powder are.

Page | 12

Raw Coconut Raw coconut are ordered and procured from the rural areas which are nearby the Plant. The rates of these coconuts are decided on the market rates and some time on the standard rates pre decided. They are collected at a convenient area such as collection point from where it is transported back to the plant for transformation purpose. These coconuts form the basic ingredient or raw material for the manufacturing of desiccated coconut powder. Husk Removal It is the first step of the production process. In this process, coconut husk is removed from the raw coconut manually. The collected husk is stored separately for selling and this forms the by product of the manufacturing process. This later is sold off to the coir industries nearby. Then this coconut is transferred to the next process. Shell Removing This is the second stage of the production process, wherein the process of removing the coconut shells without damaging the inner part of the coconut is done manually with the help of small hammers. This process requires experienced workers as there is a chance of cuts and wounds during this and also for the intention of minimising the wastages during this process. After removing the shell the coconuts are transferred to the next process. Peeling In this process shell removed coconuts are sent for peeling off the red thick skin covering it. This is done with the help of peeling blades used by skilled workers. Here experienced labour is needed to avoid any accidents and wastages. Such peeled coconuts are sent for the next stage of processing. Washing In this process the peeled coconuts are put into a washing tank after which they are broken over and washed properly with clean water. This process is repeated thrice before it is sent to the next stage. Here clean water is used and the coconut is broken into small pieces so that the water inside the coconut could be drained off and cleaned properly. Such cleaned pieces of coconut are sent in for the next round of processing.

Page | 13

Crushing This is the most important step in the production process. Machines are used for this purpose. Here the machines are of grinding type. The cleaned coconut pieces are put into this grinding machine where they are grinded dry and converted into fine coconut powder. Thus obtained coconut powder is sent for further processing. Drying In this process big dryers are used which dries the powdered coconut obtained from the previous stage. This dryer has six compartments arranged horizontally. The crushed powder is put in the top compartment and is passed through the other five layers at an interval of 15 to 20 minutes each. This movement through the layers is done with the help of gear arrangement. The capacity of each compartment is about 6 buckets of coconut powder. Here the drying is done by passing hot air through the chambers at a constant temperature of 90 C. This hot air in the chamber can be provided either by electric heater or by burning firewood at the bottom of the chamber. Thus heated powder is collected in a aluminium tray kept at the bottom. If the powder is not dried completely then the whole process is repeated till the required level of dryness is obtained. Then the dried powder is sent to the next level for further processing. Shifting This is a process where the powder is purified manually with the help of filtering machine or shifters. There may be a chance that some impurities may have been added in the drying process due to the machine impurities or other factors, so as to remove this, shifting process is used. Then the powder is passed on to the next level. Packing From the shifting process the finished output is got which is ready for packing. It is the last step of the production process. At this stage desiccated coconut powder is packed in 1kg bags after weighing on weighing machine. Then such 25 bags will be packed in a single sack. The mouth of the sack will be stitched by Reva machine, and then the sacks will be kept in the godown for dispatch.

Page | 14

k) Future Growth and Prospects In recent years consumers are becoming more health conscious and diet based mentality. They are moving towards more health oriented products rather than taste oriented. This give an edge for this coconut based industries which are health and nutritious in terms of health. Consumers would prefer coco based products such as biscuits, bakery products etc. This would increase the consumption of desiccated coconut powder in the near future. This in turn would give a bright growth prospective for the firm and industry as a whole. Currently the industry is facing an acute shortage of labour, but considering the fact that there are a lot of R&D work being conducted for mechanisation of the process, the things looks bright. This industry not just increases the wealth but also helps the farmers become more agro oriented as it would provide good returns for lesser investment. This will increase job opportunities and would contribute to the growing economy. Such firms can even go public for raising funds and expand their units where there are abundance of raw materials and labour. There is a vast undiscovered potential in this industry which could be tapped into and greater profits could be made over the years.

Page | 15

McKinseys 7s Frame Work The McKinsey 7S Framework is a management model developed by well-known business consultants Robert H. Waterman, Jr.and Tom Peters (who also developed the MBWA-"Management By Walking Around" motif, and authored In Search of Excellence) in the 1980s. This was a strategic vision for groups, to include businesses, business units, and teams. The 7S are structure, strategy, systems, skills, style, staff and shared values. The model is most often used as a tool to assess and monitor changes in the internal situation of an organization. The model is based on the theory that, for an organization to perform well, these seven elements need to be aligned and mutually reinforcing. So, the model can be used to help identify what needs to be realigned to improve performance, or to maintain alignment (and performance) during other types of change. Whatever the type of change restructuring, new processes, organizational merger, new systems, change of leadership, and so on the model can be used to understand how the organizational elements are interrelated, and so ensure that the wider impact of changes made in one area is taken into consideration. OBJECTIVE OF THE MODEL (To analyze how well an organization is positioned to achieve its intended objective Usage

Improve the performance of a company Examine the likely effects of future changes within a company Align departments and processes during a merger or acquisition Determine how best to implement a proposed strategy

The Seven Interdependent Elements The basic premise of the model is that there are seven internal aspects of an organization that need to be aligned if it is to be successful Hard Elements

Strategy Structure
Page | 16

Systems

Soft Elements

Shared Values Skills Style Staff

McKinseys 7s Frame Work of Kamadhenu Coconut Industies Structure

Partners

Managing Partner

Profit Sharing partner

Production

Finance

General

Foreman Chief Accountant Supervisor

Secretary Staff

Workers

Workers

The Firm is a partnership Firm where in there are two partners. Mr. K. Nagaraj Rao is the main and working partner where as Mrs. Shubha wife of Mr. K. Nagaraj is the profit sharing as well as inactive partner. Mr. Nagaraj Rao manages all the Firms affairs and is rightly paid

Page | 17

the remuneration for the same. There are three main wings under the Working/Managing partner, namely Production, Finance and General wing. The production wing has a Foreman under who there are Supervisors who supervise the production process done by workers under them. Its a unilateral arrangement and has a well defined arrangement for the flow of command. This leads to least confusion and better organizational efficiency. The other wing is the Financial wing which consists of a Chief Accountant who looks after the entire financial statement of the Firm and also the investment decisions or suggestions for the same. The other wing is the General wing which has the employees such as office staff, secretary, drivers, security personnel etc. All are under direct command of the manager and are guided and instructed by manager himself. As the Firm is small there is less confusion in the flow of command and is well maintained. In future, when the firm grows big there has to be separate departments for HR as well. Now the HR department is looked after by foreman who acts as the human resource manager of the firm according to the factory law. Skills Kamadhenu Coconut Industry usually goes for an informal way of recruitment. Here personnel are recruited by manager cum owner Mr. Nagaraj based on some recommendations from relatives or known people. A minor verification of the qualification and eligibility is done over here and are recruited. The vacancy arises only in the case of resignation, death etc. While recruiting manager keeps in mind the age of the personnel recruited, their working ability, their willingness and necessity to work. Here the salary expected is also taken into account along with minor enquiry of background and health conditions. For the accountant post minimum qualification is B.Com and for supervisors its PUC and above. For the working class as such there is no educational qualification. There is no training department as such in the firm. Here the training of the personnel recruited takes place on the site. Here they learn work by working under experienced workers and later when they retire or get promotion or leave the company, these recruits take their position. There is a strong need for establishing a well defined training unit in the long run when the company grows to a large unit. And also by having a well defined training unit, they can produce quality output along with minimal accidents in the Firm. The skill training and upgradation is the need of the hour if the Company has to make competitive edge in the market.
Page | 18

Style Kamadhenu Industry practices top down approach of decision making. Here the authority of decision making lies with the manager cum owner. But while taking any decision he consults the seniors in the organization along with his relatives and known persons who are close to the firm. Here the command flows from top to bottom and is a vertical downward manner. Entire decision is made by the manager and only small decisions pertaining to the day to day operations regarding leave of the labourers, maintenance of the machines etc. are taken by supervisors of the firm. The pricing decisions of the raw materials that is at what price it should be bought and the prices of the finished products that is at what price it must be sold is usually done by the manager in the company meeting which is usually held once a month. There in this meeting the views of all the company senior workers are taken on all the aspects effecting the production and supply of the products and based on this the pricing decision is made. As the company structure is lean and is not a public company, the manager enjoys the authority to take any decisions regarding the pricing and investment of the firm. Strategy The main strategy the firm adopts in terms of efficient production and having minimum wastage is by having unique wage payment system. Here the firm adopts two types of wage payment namely Time Wage System and Piece Wage System. Time Wage System Under this method wages are paid on the basis of time spent on the job irrespective of the amount of work done. The unit of time may be a day, a week, of fortnight or a month. In Kamadhenu Industries some labourers, who are engaged indirectly in the production process are paid wages on a monthly basis according to their part of the work. Labourers working near machines who look after the maintenance of the machines and the supervisors looking over the work done will be paid in this system. In this system the wages are calculated as below Total Wages = Hours of work * Rate per hour.

Page | 19

Simple Piece Rate or Straight Piece Rate System Under this method, remuneration is based on the amount of the work done or output of the worker. One unit of output is considered as one piece and a specific rate of wage is paid per piece. This industry adopts the piece time rate system to the labourers who are engaged in husk removing, shell removing and red skin removing process. Here the wages are paid according to the amount of work done by the personnel. Greater the number of pieces produced by a worker, higher will be his earnings. It is given as below Earnings = Number of units of product * Rate per unit. The firm enjoy several advantages due to the adoption of these methods in the wage payment. Some of advantages are Calculation and payment of wages will be simple. Need of less supervisors and hence cost of supervision is low. The method is just and fair to all without any differences of opinion. It increases the overall efficiency and productivity of the firm. Ambitious and efficient workers are provided ample opportunity to utilise their talent and increase their earnings. System The system followed in the firm regarding the supply of the finished products is of First In First Out principle (FIFO). The orders which are placed by the customers are executed in the order of their receiving. There is no skip or jump in the order for any reasons or for any consumers. Here when the orders are placed they are given a unique order number which will be in sequence so that the customers can track their orders. All the orders will be executed sequentially and this method of the firm has gained a wide appreciation from its customers. This is also one of the reasons for the customers being long standing with the firm. Here the orders are placed either through the mail, e-mail, telephonic or through face to face meeting. Once the orders are confirmed there will be a computer entry made to it as to what is the order number, person ordering it along with address, date of order, quantity of order, date of delivery needed and its current status. Later this order sheet is sent to the production supervisor and based on this the production process is estimated and produced. The packed
Page | 20

and marked sacks of the final products are then dispatched to the respective addresses either through courier for small quantity or through the transport vehicles for large consignment. Such a systematic process helps the firm to maintain a good rapport with its customers and also help it to estimate the required product and raw material estimates. Staff Staff constitute the important part of any organization. If they realise their responsibilities and powers properly, it can lead to synergy in any organization. Here in this Firm, the following personnel are recruited and given the necessary powers. Manager He is also the owner of the firm. He enjoys the ultimate power in terms of decision making and enjoying the profits got out of the same. He is unquestioned and is supreme in this firm. He takes care of all the decision making and order finalization and pricing decisions in the firm. Supervisors They receive the directions from manager and act according to it. They also give directions to their subordinate workers working under them on day to day matters. They are also given the freedom to take decisions regarding the day to day actions and other maintenance works in the firm. Workers They are assigned certain work by the supervisors or directly by the manager, which they have to do with the satisfactory level expected out of them. They dont have any decision making power as such other than that is required for their assigned task. Accountants They look after the financial affairs of the company. They give the suggestions regarding the financial decisions and investment decisions to the manger. They also take care of the financial data preparation and also annual audit in the firm. Foreman They are just below the managers in reporting. They are placed high in production unit and they take all the decisions regarding the production and they are given the authority to take decisions on leave matters of their subordinates. They also supervise the working of the supervisors and other workers in the organisation. Shared Values Firm is keen on maintaining quality output; it strives in all ways possible for maintaining good employee and customer rapport. It gives utmost importance to quality of products and
Page | 21

its customers satisfaction. For achieving this, it provides required facilities for its employees so that they help in producing the required level of productive efficiency and quality of the product. The following are the facilities provided for employee satisfaction Drinking water facilities Clean and hygienic work place Safety measures to avoid any accidents Housing facilities for the employees who come from far off places There is provident fund facilities for its employees Rest room for male and female workers separately Firm provides pickup and drop facilities for its employees. Along with its employees satisfaction, the firm is keen in providing contribution to the society as well. The firm has contributed to society and for the welfare of the people living in it by providing funds to sponsoring various competitions, sports, games, educational purposes etc. organised by various NGOs and local authorities.

Page | 22

SWOT ANALYSIS SWOT analysis (alternately SLOT analysis) is a strategic planning method used to evaluate the Strengths, Weaknesses/Limitations, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favourable and unfavourable to achieve that objective. The technique is credited to Albert Humphrey, who led a convention at the Stanford Research Institute (now SRI International) in the 1960s and 1970s using data from Fortune 500 companies. Setting the objective should be done after the SWOT analysis has been performed. This would allow achievable goals or objectives to be set for the organization.

Strengths: characteristics of the business, or project team that give it an advantage over others

Weaknesses (or Limitations): are characteristics that place the team at a disadvantage relative to others

Opportunities: external chances to improve performance (e.g. make greater profits) in the environment

Threats: external elements in the environment that could cause trouble for the business or project

Identification of SWOTs is essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs. First, the decision makers have to determine whether the objective is attainable, given the SWOTs. If the objective is NOT attainable, a different objective must be selected and the process repeated. Users of SWOT analysis need to ask and answer questions that generate meaningful information for each category (strengths, opportunities, weaknesses, and threats) in order to maximize the benefits of this evaluation and find their competitive advantage. SWOT of Kamadhenu Coconut Industries Strength Kamadhenu Coconut Industries produce good quality of desiccated coconut powder. They have given utmost importance for their production process and the quality of
Page | 23

output got out of it. They have never compromised on the quality aspect over the years when compared to price. More than 85% of the raw materials are gathered from the local area and from the permanent suppliers which have reduced the cost of transportation and the danger of scarcity of commodities. It has also ensured a continuous supply of raw materials even in the case of crisis. The efficiency of the firm is good when compared to others. The wastage is minimal in the production process as experienced employees are hired and also to the fact that the husk and the shell of the coconuts are used for the drying machines for heating. The available labour is mostly locals which makes the wages cheaper and also the pickup and drop facilities more convenient and cheap. Good water and power facilities to the Firm has made the production process easier and economical. The Firm is connected to NH66 with good road facilities. It also has a local bus stop in front of the Firm which makes it easier for transportation of raw and finished products along with labour movement. The Firm has the advantage of being near the post office, bank, courier drop spots etc. which makes it more cheaper to access. The Firm also has the advantage of good and stable and unilateral management which makes the Firm more effective and profitable. Weakness The scarcity of labour in the region and also the increasing wage rates of experienced labourers decrease the profit margin. There is no much local market available for the desiccated coconut powder. The Firm doesnt have a website of its own through which it could have got orders. It is located in not so accessible kind of a place which makes its customers life difficult.
Page | 24

It doesnt have the mechanised process for production of desiccated coconut powder. It doesnt have standard quality control mechanisms. It lacks training department for the newly recruited personnel.

Opportunity The labour turnover could be reduced by providing some additional facilities and benefits for them. It can have its own R&D department for the advancement in the production process. It can install advanced machinery for production purpose. It can go for E-marketing by launching its website and other mailer facilities. It can open units where there is abundance of labour and raw materials. It can go for acquisitions of the nearby weak firms which has adequate labour but no orders for production. It can seek the opportunities in the far northern regions for the desiccated coconut powder. Threats There is stiff competition from the nearby firms which are into production of similar products. Now a day the farms are being converted into site, which shows the negligence of farmers in this part of the region. This can lead to shortage of raw materials in the coming days. It also faces threat from the policy changes from the government. It faces a threat of shortage of labour which may be due to the migration of labours from this firm to others on account of better benefits provided there. They also face a threat of being out dated due to non mechanisation of their firm.

Page | 25

They also face threat from the robbers, who try to steal the raw materials stored in the godown.

They also face shortage of power which is becoming a major problem in this part of the region.

Page | 26

FINANCIAL AND RATIO ANALYSIS Ratio analysis Ratio analysis is a form of analysing the companys strength in the market by using the various statistical data available from its balance sheet. There are various ratios which can be calculated and which tells us about the various performances of the company in various fields. They are as follows Fixed turnover ratio: This ratio measures the productivity of fixed asset. This ratio indicates to what extent the fixed assets of the concern have contributed to sales .A high ratio indicate a high degree of efficiency in fixed asset utilization and low ratio reflect inefficient use of fixed asset. Fixed asset turnover ratio= sales /average fixed Asset. Table 5.1 Fixed turnover ratio YEAR Sales(Rs) Avg. Fixed Fixed Asset turnover ratio

Asset(Rs) 2007 2008 2009 2010 2011 97,78,750 22,32,546.19 4.380088

1,01,42,650 24,64,499.12 4.115501 1,03,07,350 23,97,846.90 4.298585 93,54,318 99,45,550 22,64,678.08 4.130528 39,15,811.47 2.539843

Page | 27

12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 2007 2008 2009 2010 2011 Fixed Asset turnover Sales(Rs) Sales(Rs) Avg. Fixed Asset(Rs) Fixed Asset turnover ratio

Year

Graph 5.1 From the above graph, it is evident that over the years there has been almost a constant fixed asset turnover ratio. This indicates that the fixed asset has been contributing well for the sales over the years. It can be observed that in 2011 it has dipped to 2.53 which is due to high investment in fixed assets in this year compared to sales. This clearly shows that the firm is having stable sales compared to the fixed assets. This is a clear indicator to show that company has a very good long term prospects. Capital turnover ratio Capital turnover ratio is the ratio between sales and proprietors fund. Capital turnover ratio=sales/proprietors funds Table 5.2 Capital turnover ratio YEAR 2007 2008 2009 2010 2011 Sales(Rs) 97,78,750 1,01,42,650 1,03,07,350 93,54,318 99,45,550 Capital(Rs) 15,49,868.98 15,49,868.98 15,49,868.98 15,49,868.98 15,49,868.98 Ratio 6.3094042 6.5441983 6.6504653 6.0355540 6.4170262

Page | 28

12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 2007 2008 2009 2010 2011 Sales(Rs) CAPITAL(Rs)

Year

Graph 5.2 It can be seen that over the years the company has maintained a constant capital turnover ratio. This shows that for every rupee invested by the investors, the Company is able to generate six times the revenue over the years. It is also evident that the Company is having good liquidity as well in the market. Debtor Turnover Ratio It shows how quickly receivable or debtors are converted into cash. In other words, the debtor turnover ratio is a test of the liquidity of the debtors of a firm. The liquidity of a firms receivable can be examined in two ways: i) debtor/receivable turnover ii) average collection period. The debtor turnover shows the relationship between credit sales and debtors of a firm. It is calculated as Debtor turnover = Total Sales/(Debtors + Bills Receivable) The liquidity of the firm is also calculated by the average collection period of debts. It is calculated as Average collection period = Months in a year/ Debtor turnover

Page | 29

Table 5.3 Debtor Turnover Ratio YEAR Sales(Rs) Debtor + Bills Debtor Receivable(Rs) turnover ratio 2007 2008 2009 2010 2011 97,78,750 1,01,42,650 1,03,07,350 93,54,318 99,45,550 28,64,012.1 29,66,695.1 37,09,562.93 69,38,449.22 34,30,094.91 3.414353 3.418838 2.778588 1.348185 2.899497 3.51457 3.50996 4.31874 8.90085 4.13864 Average collection period

The above table shows that during the initial years the credit sales was more so the liquidity position of the firm was not that good. But over the years the firm has improved on this aspect and due to this the liquidity of the firm has also improved. This is a must for any company as they are non performing asset and they have to be recovered fast so that they can be invested in better ways so that it yields returns. Current Asset turnover ratio: This ratio measures the productivity of current asset. This ratio indicate to what extent the current asset of the concern have contributed to sales. A high ratio indicate a high degree of efficiency in current asset utilization and low ratio reflect inefficient use of current asset. Current asset turnover ratio= sales /average current asset. Table 5.4 Current Asset turnover ratio YEAR Sales(Rs) Avg. Current Asset(Rs) 2007 2008 2009 2010 2011 97,78,750 4596868.16 2.127263 2.009815 Current Asset turnover ratio

1,01,42,650 5046557.8

1,03,07,350 6432001.78 1.602510 93,54,318 99,45,550 9646540.7 0.969706

5697824.55 1.641735

Page | 30

12,000,000

10,000,000

8,000,000

6,000,000

Sales(Rs) Avg. Current Asset(Rs)

4,000,000

2,000,000

0 2007 2008 2009 2010 2011

Year

Graph 5.3 The above table shows that, in the initial years the current asset turnover ratio was healthy and was above 2. But in recent years the current asset turnover ratio has dipped to a greater extent. This means in the recent years the current assets are more than in the past years. The best current asset turnover ratio is the one where it is above one. In recent years it has been constant and the Firm has tried to better utilise the current assets for improving the sales of the Firm. But still it is not able to meet its past performance. Inference from the Financial Analysis The fixed asset turnover ratio was good over the initial years. For every rupee invested in the fixed assets, 4 rupee was the returns. This shows that the company is able to invest in long term assets and its at a high range when compared to the normal investment portfolio. This is a healthy sign for any firm. Capital turnover ratio is high in the range of 6 rupee. Every firm is expected to produce a high capital turnover ratio. It means that for every rupee invested the firm is getting a high returns and this also shows that the firm is having a very healthy financial position. In recent times the firm is able to have a low debtor turnover ratio. This means that the receivable are being recovered faster in recent years than in the past. This also

Page | 31

shows the good liquidity position of the Firm and also the healthy financial position of the firm. In recent years, the current assets have increased when compared to the past. This is evident from the current asset turnover ratio. In the past it was good but in the recent years it has dipped to a greater extent. This shows that the current asset is being depleted in the Firm. From the above ratio analysis it is evident that the Firm is having a good liquidity position and financial position and profitability of the firm is good.

Page | 32

LEARNING EXPERIENCE AT KAMADHENU COCONUT INDUSTRIES As a part of curriculum activity of MBA course, we are suppose to expose ourselves to working environment of any organization and study the application of management aspect in such organisation. Hence the objectives of the study are As my academic requirement, it is necessary to get practical training as a part of fulfilment of masters degree in business management. To get practical knowledge about the working of a manufacturing enterprise. To know the application of human resource and marketing in production. To know the management practices that is applied and practices in the organisation. To make suggestion and recommendation to interested persons for the improvement of their activities. To create curiosity among people to know what is unknown. Over all Kamadhenu Coconut Industries is a well maintained and managed firm in terms of operation and production process. It is managed by an able administrator and the employees of this Firm have reacted positively for all the decisions taken by the administrators of the Firm. There has been year on year growth in the Firm even though there were several problems faced by the Firm over the years. The problems of the Firm over the years have been positively addressed and have been solved to a greater extent. The employees in the Firm are dedicated and are professionally oriented towards their work. They have a well maintained client base and have maintained good rapport with their clients over the years. The Firm has a good marketing and supply unit. They have even good transport facilities along with good machinery and electronic equipment. Though the Company is well equipped with better infrastructure and operations, still it is facing problems such as In recent times there has been a dip in the quantity and quality of the raw materials that are being supplied to the Firm. This is attributed mainly to the increased competition in the region and also the fact that several farmers are migrating from the cultivation of coconut to better and economical agro products. This has affected the quality of finished products to a greater extent over the years. There has been frequent fluctuation in the raw material prices which will in turn affect the prices of the finished products to a greater extent and will effect the profitability of the Firm.

Page | 33

 The major problem in the coastal region is of power. There has been acute shortage of power in this region which has affected the productivity of the industries to a greater extent. Although the generators are being installed in most of these industries, it is not economical to use them for production as the cost of diesel is too high when compared to the price of the finished products. One of the major problems faced by this Firm is that of labour. This Firm is frequently facing problem of labour absenteeism and labour iteration. The Firm is also facing the problems of frequent breakdown of machinery due to continuous production. And also the fact that having a standby machine is expensive in terms of production cost makes the condition even worse. The Firm is also facing problem of being outdated in terms of machinery and technology used in the firm. The machines used in this Firm are very old and modern machines have not yet been installed. There has been a decrease in the sales over the years due to the stiff competition provided by the competitive firms. The Firm is also facing the problem of shortage of working capital. There is also an unfavourable market conditions and also the transportation cost over the years has increased to a greater extent which has brought down the profitability of the Firm considerably. The salary/wages is increased on the basis of experience and not on the basis of efficiency. This has lead to discouragement of the young and energetic employees in the Firm. This is also one of the reasons for high employee turnover. Limitations The project was to be done in the limited period of time. The Owner was not willing to provide the exact information about the product like the exact profit they get from it. So the extent of information provided in the industries is very less to go in detail. There were also a lot of financial data which the owner was reluctant to share with.

SUGGESTIONS Although the firm is a well maintained one, there is lot of scope for improvement in terms of technology and process involved in production. By implementing these suggestions, the Firm

Page | 34

can hope to achieve new heights and better profitability. Some of the important suggestions are Modernisation of technology and machinery is the need of the hour. By replacing the old and outdated machines and process with new machines, the productivity as well as the profitability of the Firm can be increased. The Firm should take proper precautions for the maintenance of the machines and should try to replace the old machines which consume huge capital for their repair. The annual repair charges of the machines are becoming more and more burden on the balance sheet. For better competition in the market, the Firm must adopt suitable advertising strategies, so that it can effectively compete with its rivals. It must go for E-marketing and intensive marketing strategies for gaining an advantage over its rivals. It must try to widen the local market for its products. For this it must advertise, the various uses and nutritious values and advantages of desiccated coconut powder in local newspapers and other media. The Firm must provide canteen facilities to its employees. There are many employees who come from far off places and work in the Firm. For their convenience, the Firm must provide quality canteen facility to its employees which would take care of their food needs. Try to improve the rapport with its clients and customers. As there is a huge competition in the market, the Firm must try to attract more clients and at the same time, it must try to retain the existing client by giving better quality services and some additional benefits for their buy. The Firm must also give additional benefits to its employees so that it can reduce the labour turnover. The Firm must also launch its own website so that it can take orders online and also give information about the Company through electronic media. The manager may also go for adding some new partners so that they can finance the Firm for its expansion and also to meet its working capital deficit. The Firm should go for some quality check certifications, so that it can highlight it when it is being represented in some national level conferences. The Firm should also try and install new and automated quality control mechanism so that it can have a consistent quality of its output at a lesser cost.
Page | 35

 There is a need for establishing R&D unit along with the training unit to research and train the new joiners. There is also a need for more standardisation of wage system in the Firm so that labour turnover could be reduced. There is also a need for the Firm to get represented itself in some national and international conferences, so that the Firm gets highlighted and it can expand its operation. Better and clear policy must be formulated in terms of wages and other matters when the Firm thinks of expansion. CONCLUSION Ever since the incorporation of M/S Kamadhenu Coconut Industries by late Mr. K. Govinda Rao, the Firm has strived for providing excelling quality products to its clients and customers. Currently Mr. K. Nagaraj Rao who has taken over from Mr. Govinda Rao has sincerely tried to maintain the same service to his clients and customers. The Firm believes that good quality product can be produced only when there are satisfied employees working for them. For the same reason the Firm and its management gives utmost importance to the employees and their fulfilment of needs. In Kamadhenu Industries, 75% of the production purpose is done manually and rest 25% is mechanised. This shows that the Firm provides a wide opportunity for providing employment to the local population. It is also contributing in a large way for the well being of the people in that region by providing them employment and other monetary benefits in the form of donations to the sports, games and other educational activities. North Indian regions provide the major market for the Firms products. About 90% of the Firms products are supplied to the north Indian regions and only 10% get sold in the local market. This clearly shows that desiccated coconut product has a high demand in the north Indian regions. This can also be for the fact that the availability of coconut and coconut products are in scarce in those regions. There many improvements that can be brought about in the Firm in all aspects. Implementation will not only improve the quality of products, but also will improve the profitability of the Firm to a greater extent. There is a wide scope for expansion of this Unit if

Page | 36

they could counter attack the problems such as labour and capital. This industry as a whole will have a better growth opportunity in the coming days.

Page | 37