Anwesh-Kumar-Chakraborty_2013PGPX103_Haldiram-In-India

GENERAL OPERATIONS MANAGEMENT – PROJECT REPORT COMPANY: HALDIRAM’s

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GENERAL OPERATIONS MANAGEMENT

A PROJECT REPORT ON HALDIRAM’s

Submitted by:

Anwesh Chakraborty 2013PGX103


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Table of Contents

Contents Executive Summary ............................................................................................................. 3

Company Background ......................................................................................................... 4

Plant Location...................................................................................................................... 6

Inventory management ...................................................................................................... 8

Process design ................................................................................................................... 10

Quality Process .................................................................................................................. 12

Distribution ....................................................................................................................... 13

Problem Identification ...................................................................................................... 15

References ......................................................................................................................... 15


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Executive Summary

In this report, we seek to study and analyse the Operations Management of Haldiram’s packaged

food SBU, a family owned company operating in Indian food industry.

The report primarily focuses on the following aspects of Operations Management at Haldiram’s:

Facility location and layout planning

Inventory Management

Process Management

Managing for quality

Distribution

Various aspects of supply chain management and value chain analysis are identified and analysed

in the report. After the analysis, our team has identified few issues that are still not addressed in

the supply chain management of Haldiram’s. In conclusion, we have proposed the solutions to

those issues.


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Company Background

1937 – One man shop in Bikaner

1983 – 1st shop in Delhi

Early 90s – Split into 3 Units – Kolkata, Nagpur & New Delhi.

1992 – Manufacturing Unit with Retail Outlet

1995 – Restaurant in Delhi

1997 – Production factory for Namkeens

2000 – Entered International Markets

Haldiram’s has been rightly termed as Taste of Tradition. Known for its unbeatable taste in

Mithais and Namkeen segment, Haldiram’s is a household name today, a Food Company

synonymous with taste, hygiene and innovation. It was in year 1937 in Bikaner, when Ganga

Bishen started selling Bhujia sev in Bikaner and it became so popular within city that even tourist

coming to the city prefer to buy it. Then in 1941, the name 'Haldiram's Bhujiawala' was used for

the first time. In 1983 first retail outlet was opened in Delhi. Then after they expanded business

in Kolkata followed by another unit in Nagpur

Haldiram’s has grown both in domestic and international market. Today Haldiram’s is known for

matchless quality, packaging, efficient supply chain management, distribution network and zero

impurity. Company uses best technology for its all manufacturing units and special attention is

given to packaging due to which shelf life of namkeen has been increased to six months. The

Aggarwal family that owned Haldiram’s group always paid attention to need of customers in

order to expand. For this the company offers wide range of variety catering to needs of different

age group.

Haldiram’s product range from namkeen, sweets, sharbat, dairy product, ice cream, snacks, dairy

and bakery products, from this highest contribution comes from namkeen. Company’s Nagpur

unit alone manufactures 51 varieties of namkeen, Delhi 25 and Kolkata 37. Company varied

product tastes according to preference of customers residing in different parts of the country.

Haldiram’s group has well managed distribution network, which has its reach for its products in

country as well as other parts of world. Carrying forward (CFs) agents of company collect goods

from manufacturing unit who pass them to distributors, who in turn send them to retail outlets.

Haldiram’s has entered into e-retailing also, they have tied up with INDIATIMES to sell their

products. This clearly shows that the company that has its roots in traditional India is innovating

with time and this is what a successful company does. Innovation and marketing is a key to

success for Haldiram’s.


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Today, Haldiram’s controls a domestic market share of about 30% in Indian Namkeen sector.

Today Haldiram's is a 4 Million dollar brand that is present across USA, UK, Middle East. Present

in supermarkets the world over e.g., Tesco, Somerfield's, Spinney's and Carrefour. It has become

a way of life for Indians no matter which country they live in.

Vision:

Be the Trend Setter in the field of Healthy and Tasty Eating To Achieve a Sustainable Growth this

will bring about an overall upliftment of the Organization, its People and the Society.

Mission:

Review, Recreate and Rediscover the trend of Healthy Eating and Innovate and Invent fresh new

methods to Nourish and Delight everyone we serve.

Goal:

To provide our customers Perfect Taste and Quality in the Best of Packaging.

Awards & Certifications:

Haldiram’s bagged the prestigious ‘INTERNATIONAL AWARD FOR FOOD & BEVERAGES’ awarded

by Trade Leaders Club in Barcelona, Spain in 1994.

The Group has also to its credit ‘KASHALKAR MEMORAIL AWARD’ presented by All India Food

Preservers Association (Regd.) in 1996 at its Golden Jubilee Celebration for manufacturing the

best quality food products.

APEDA EXPORT AWARD 2001-2002’, awarded by Agricultural & Processed Food Products Export

Development Authority for the outstanding contribution to the promotion of Agricultural &

Processed Food Products during the year 2001-2002.

Certifications : ISO 9002, and HACCP

Haldiram’s Core competencies:

The Core competency of the company lies in

Food Taste – Traditional Indian authentic taste.

Food Quality – Best quality raw material and latest industry practices to create the taste

while maintaining hygiene and contemporary packaging with increased shelf life & freshness.

Innovative – Branding of “Namkeens”, adaptability to ever changing trends, inventing and

re-inventing themselves to maintain a competitive edge.


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Plant Location

The plant location for any business needs to be carefully chosen as it is detrimental in

determining the ultimate cost of the good manufactured. The suitability of location for a

company can be judged from the 7 key factors:

We have chosen Haldiram’s Nagpur plant for our research.

Haldiram’s Nagpur plant is situated in ‘Small factory area’ in the village Bhandara, nearby Nagpur.

The ‘Small factory area’ consists mainly of Industries and warehouses. The advantages

/disadvantages of the location based on the seven key factors are analysed as follows:

Land: Small factory area has special benefits from the state govt. The factory avails lower tax

rates, continuous electricity and water supply.

Labour: Being situated in a village outside Nagpur, Haldiram’s can avail labour at lower wages.

Since Haldiram’s is not into labour intensive industry, the requirement of skilled labour is not

high which in turn helps in reducing the cost of manufacturing.

Capital: Nagpur is a fast growing city and the second capital of Maharashtra. It has presence of

various capital sources like banks and NBFC’s and hence obtaining of capital for further business

expansion is not a problem for Haldiram’s.

Sources: The factory is located close to the sources which is an advantage to Haldiram’s. The

Small factory area, houses many warehouses and stockists of grains, pulses and other raw

materials required for the manufacture of Namkeens and other products. The close proximity of

the suppliers reduces the inbound logistics cost for the company. The close proximity of sources

also increases the utility of perishable goods required for the company for its various processes.

Production: Since the production process of Haldiram’s is a weight normal process where most

of the weight of the raw materials is transferred into the end product, a separate location for

special logistics needs is not required.

Land Labour Capital Sources

Production Market Logistics


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Market: The products of Haldiram’s are non-perishable goods have a shelf life of around 6

months due to the best packaging standards. Hence, the location of plant far from markets is not

a disadvantage for the company.

Logistics: The primary distribution network of Haldiram’s comprises of carry forward agents who

carry the goods from the factory to the distributors all over the country. Nagpur has good

connectivity via rail, road and air to the whole country and the location gives an added advantage

of good logistics combined with all of the above factors.

Thus, we find that the Nagpur factory of Haldiram’s is situated at a place best suited for

its mode of operation and the business it is into.


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Inventory management

At Haldiram’s, suppliers play a key role in inventory management.

The perishable products, like groundnuts and other condiments are stored in cold storage. This

cold storage are a part of the supplier’s infrastructure.

Contract with supplier is made on basis of his ability to store perishable products and the logistics

efficiency.

Since there is a low uncertainty in demand, the supply chain can be termed as ‘risk hedging’. This

is because all production is made, against advance payments only.

For raw material, Haldiram’s stores inventory worth 36 hours only in its premises. For packaging

material such as packet film, the inventory stored is worth 2-3 days of production.

The carton or seconday packaging material is stocked based on a 15 days of production.

Layout

Generic layout at any food processing plant is

At Haldiram’s, the raw material is unloaded/stored at the incoming material area.

From there it is taken to the processing plant.

Once the food is processed, it moves forward to packing. After packing the material moves onto

the secondary packaging stage, where it is put into cartons to be moved onto the dispatch area.

The logistic partner picks up the product for delivery from the dispatch area.


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A detailed view of the process is given below.

Incoming Material

Processing

PackingSecondary

Packing

Dispatch


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Process design

The machines at Haldiram’s are fully automated, 99% imported machines.

All products except ‘Bikaneri Bhujia’ is made on these state of the art machines using the

contemporary technology, unavailable to many, in India.

These machines operate at 100% utilization level.

The above process is used for products such as ‘Aloo Bhujia’ and ‘Punjabi Tadka’.

The raw material (potato), is moved from the incoming material area and is washed

After an extensive washing process, the potatoes are moved onto the peeling station

After the peeling process, the potatoes are boiled.

The potatoes are mashed, once the boiling process is complete. Since this is an automated

machine, there is no lag time to allow the potato to cool down.

After mashing, the mashed potatoes are mixed with gram flour (Besan) and spices.

These spices are proprietary and vary according to the product being made.

After the dough is ready and set, it is extruded

The extruded dough is sent to the frying section.

The fried dough is cut in a machine called as breaker, which is a roller cutter

Once the product is ready it is coating with seasonings

The cooled product is then sent to the primary packing area. The packaging process

involves inclusion of nitrogen gas in the packet.

The packed material is sent to the secondary packaging area where it is put in the cartons

Washing

Peeling

Boiling Mashing

Mix Dough

Extrution Frying

Breaking

Seasoning Coating

Packaging

Secondary packaging

Dispatch


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The cartons are then dispatched to the delivery area

The logistic partner takes over the product from the dispatch area

For the most widely sold product ‘Moong Dal’, there is a different process

This product is made utilizing a second workstation and layout.

The pulse is sorted as per size and only the size that meets criteria is moved forward for

processing. The initial sorting is also done at the supplier level.

The pulses move onto the washing section, where the impurities and dirt etc. are

removed.

The soaking process follows the washing where the time is nearly 2-4 hours

The moisture is removed in the next step

After drying, the product is sent to the frying process

After the completion of the frying process, salt and spices coating is done.

After cooling, the packaging process follows.

Bikaneri Bhujia is still made manually.

Sorting

Washing

SoakingWater

Removal

Frying

Salt and Spices

Packaging

Sec. Packaging

Dispatch


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Quality Process

At Haldiram’s, it is very imperative that the standards are met in each and every pack.

Incoming raw material is tested

For moisture

For Size

For foreign material

In the main process, frying time and temperature are key factors which are auto controlled

Final products are checked for

Acidity

Salt

Moisture

Oil percentage

Since it is a fried product, no microbiology testing is done.


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Distribution

The distribution network of Haldiram’s Nagpur is primarily divided into four zones which it caters

to. The basic organisational structure of the sales task force is given below.

The National Manager is responsible for the overall sales of Haldiram’s Nagpur in East, West,

Central and south zones. Under the National Manager, Each zone has its own set of managers

and sales task force.

The sales teams of the various zones predicts the monthly and seasonal expected sales in the

area based upon the feedback from the various retailers. Accordingly, the production of the

demanded goods is increased and kept ready for transportation.

The transportation of the goods from the factory is taken care by around 55 C&F (carry forward)

agents. The C&F agents store the goods into their warehouses from where these goods are taken

by approx. 1050 distributors present all over the country. The distributors then supply these

goods as per demands to the various retail outlets from where the customers finally buy the

goods.

National Sales Manager

Eastern Region Sales

Manager

Zone Sales Manager

District sales manager

Sales Executives

Southern Region Sales

Manager

Zone Sales Manager


Sales Executives

Central Region Sales

Manager

Zone Sales Manager


Sales Executives

Western Region Sales

Manager

Zone Sales Manager


Sales Executives


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Haldiram’s maintains goodwill with the C&F’s and distributors. Changing itself with time and

adapting to the technological innovations, Haldiram’s also has gone for a tie-up with

www.indiatimes.com with delivery time of 48 hours to one week and value added services

(personal messages).

With its nationwide spread network and a strong sales and distribution team, Haldiram’s is able

to cater to the demands of its customers on time.


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Problem Identification

After analysing the complete operation process of Haldiram’s, the area of concern and potential

risk is the growing number of complaints with respect to packing and taste of the namkeens.

Issues:

1. 1. Unable to cater to customers via online. Currently the company has ties with third

parties to provide online capabilities to its supply chain management.

2. 2. Lack of efficient waste management capabilities in the food processing units of

Haldiram’s.

Solutions:

1. To bring online order processing capabilities, Haldiram’s must implement some

enterprise tool such as SAP, ERP etc.

This will be a great value addition to the processing capabilities of Haldiram’s, following

are some of the benefits

a. Ability to serve large number of customers.

b. Ability to meet fluctuating market demand, for example, huge demand on DIWALI etc.

c. Data analytics capability to identify future trends, forecasts and to plan for events well

in advance.

d. Centralized supply chain management will help in managing exports, offshore

businesses, and franchises.

2. Haldiram’s can collaborate with market leaders in waste management for better disposal

and utilization of the waste generated from its factories. This will help Haldiram’s to

position itself as an environment friendly and socially responsible organization. In today’s

highly sensitive customer environment, such additional benefits are turning out to be

“order winners”. Haldiram’s can achieve environment protection and safety related

certifications and make a positive brand image in the market.

References www.en.wikipedia.com/haldiram

www.haldiram.com

http://www.en.wikipedia.com/

Documents

Anwesh-Kumar-Chakraborty_2013PGPX103_Haldiram-In-India