AReport on the Study of VEGETABLE AND FOOD PROMOTION COUNCIL, KERALAM (NADUKKARA AGRO PROCESSING FACTORY UNIT), Nadukkara, Muvattupuzha Submitted to the BANGALORE UNIVERSITY In partial fulfillment of the requirements for the award of the degree Of MASTER OF BUSINESS ADMINISTRATION Under the guidance of Prof. DEVIKA RANI Assistant Professor By NIKHIL MURALEEDHARAN 12MG2135 KRISTU JAYANTI COLLEGE BANGALORE Certificate from the Guide/ College I hereby certify that this organizational study report entitled study of VEGETABLE AND FOOD PROMOTION COUNCIL, KERALAM (NADUKKARA AGRO PROCESSING FACTORY UNIT), Nadukkara, Muvattupuzha is an original study carried out by NIKHIL MURALEEDHARAN under my guidance. The study does not form a part of any other work submitted to any other institution or university for the award of any other degree, diploma, associate ship or other similar title. (Signature of the guide) Declaration of the student I, Nikhil Muraleedharan, hereby declare that this organizational study report entitled Vegetable and Food Promotion Council, Keralam (Nadukkara Agro Processing Factory Unit)Nadukkara is an original study carried out by me, under the guidance of MS Devika Rani. The report does not form a part of any other work submitted to any other institution or university for the award of any other degree, diploma, associate ship or other similar title. ACKNOWLEDGEMENT First of all I thank God Almighty for all the uncountable blessings and strength he had given me for completing this work. I am greatly indebted to Dr. Vijaya Bhaskaran for providing me an opportunity to do an organizational study in the company, as part of the curriculum. I would like to place on record my gratitude and express my sincere thanks to Prof. Devika Rani, Internal Guide, for her valuable guidance and her sincere interest which involved me all through this venture. In bringing out this project work, I am immensely grateful to Mr. Senith S, Administrative Officer, NAPFU, the Company Guide for his help, constant guidance and encouragement during the course of this study. Without his earnest supervision, expert advice and appreciation, this work would not have happened in its present form. During my project work at Nadukkara Agro Processing Factory unit, Nadukkara, I was fortunate enough to get valuable guidance and help from many people like the department heads, supervisors, etc. I take this opportunity to thank each one of them. Last but not the least I would like to thank my parents and friends from the bottom of my heart for their help and encouragement. TABLE OF CONTENTS Chapter No Title Page No Executive Summary 1 Introduction 2 Industry Profile 3 Company Profile 4 Department Profile 17 5 Product Profile 62 6 Organisation Profile 64 7 SWOT Analysis 67 8 Findings, Conclusions & Recommendations 70 9 Bibliography 74 EXECUTIVE SUMMARY The organization study was done at Nadukkara Agro Processing Factory Unit, Nadukkara. The main objective of the study was to study the organizational structure of the company. This company was selected for study due to the high brand image and fame of its products. The study consisted of getting familiarized with the structure of the different departments as well as their functions. It has mainly four departments namely, production department, quality assurance and procurement department, marketing department, and finance and administration department. The time allotted for conducting the study was 4 weeks. The data was mainly collected by direct interview with the department heads as well as with the workers in the company. The company manuals, annual reports were also referred for the same purpose .The company is having a formal organization structure. The availability of raw material in plenty, nearness to the location of raw material, brand image of its products, etc. is the strength of the company. The company deals with agro based products and so the production will be seasonal. This is its main weakness. Since the society is becoming health conscious, carbonated drinks will lose its publicity and this is a great opportunity to jive. But the sudden climatic variations and competition from Frooty, Mazza, etc. are serious threats to the company. The company is running in serious losses. Its assets were taken over by Vegetable and Food Promotion Council, Keralam. The waste of the company is sold to companies like Milma. 1.1 AN INTRODUCTION TO THE STUDY An organization is a social unit of people, systematically structured and managed to meet a need or to presume collective goals on a continuous basis. It has a management structure that determines relationship between function and position, and subdivides and delegates roles, responsibilities, and authority to carry out defined task. Organization study is the process of studying the overall functions of the organization. Therefore the study of organizational structure, management process, functions, etc. are very significant. Also the study is important for future managers. In this study the organization is studied from a macro perspective. Fruits and vegetables are necessary to stay healthy and to keep the human body free from diseases. Nature provides us with a lot of goodness and it is up to us to find it out and consume them in right proportion to stay healthy and free from diseases. One of the best ways to utilize this goodness is through juice. Juices get absorbed quickly and are easy on digestive system. It is a liquid naturally contained in fruit and vegetable tissues. With the aim of preparation of fruit jam and its proper marketing, a lot of fruit juice manufacturing companies are established. This organization study is conducted at Nadukkara Agro Processing Factory Unit of Vegetable and Food Promotion Council, Keralam. It is a juice manufacturing company which started its operation in 1998. 1.2 SCOPE OF THE STUDY The organizational study is intended to provide industrial exposure and bridge the gap between theory and practice. It is conducted to understand the functions, processes and procedures of different departments of the company The study was conducted to know how the entire organization is functioning and also different process of the organization .This study was intended to cover all the departments of the organization and also to acquire knowledge from the organizational leaders. The objectives of the study are to study about the organization and working standards of employees. This study would help the company to promote the activities for developing the company structure .Observation of all the machineries , all other facilities of an organization ,and different strategies of the company is possible by it. . It is intended for a period of four weeks from August1 to August 31 2013 at Nadukkara Agro Processing Factory Unit of Vegetable and Food Promotion Council, Keralam.. 1.3 OBJECTIVES OF THE STUDY The main objective of the study is to study the organizational structure of the company. The specific objectives include:- To understand the functional departmental structure of the organization. To analyze the operations of each department of the company. To analyze and study the overall financial performance of the company. To conduct a SWOT analysis of the organization. 1.4 METHODOLOGY The required data for the study are collected through both primary and secondary data sources. The primary data sources are:- Direct conversation (interview) with the departmental heads Direct observation of the company. The secondary data sources are:- Company Brouchers Company website Company Annual Report 1.5 LIMITATIONS OF THE STUDY The limitations of the study are:- Short duration of the study. Limited details given by the officers. Confidential nature of certain data. Busy and tight schedules of the departmental heads and supervisors restricted flow of information. Even then efforts and care were taken to carry out the study in systematic manner and to make the result of the study reliable and useful one. INDUSTRY PROFILE 2.2 INDUSTRIAL PROFILE 2.2.1 GLOBAL SCENARIO Survey results reveal that global food and beverage industry manufacturer and supplier respondents identify China as the key BRIC region for their current business operations. Additionally, 37% manufacturer respondents identified they also carry out business dealings in Russia, whereas, 53% of supplier respondents identified India; furthermore, global food and beverage industry respondents across North America and the Rest of the World identified that their company is currently doing business with China and Brazil. Survey results reveal that global food and beverage industry manufacturer respondents are more inclined to do business with China in 2013, while supplier respondents favor Brazil. Moreover, 16% of manufacturer respondents identify that they are willing to do business with India, while 17% of supplier respondents identified Russia; furthermore, a higher proportion of respondents from small companies indicated a preference for business with Brazil in 2013 Regardless of manufacturer and supplier categorization, respondents envisage the ‘policy towards foreign investment’ to improve significantly in 2013 across all four BRIC, with an aim to ease up business opportunities. Additionally, Global food and beverage manufacturers identify the ‘physical infrastructure’ of Russia and China to witness some positive changes in 2013, whereas the ‘availability of local credit’ is expected to witness some positive changes in Brazil and a ‘policy towards foreign investment’ is expected to witness some positive changes in India. 2.2.2 INDIAN SCENARIO India offers the greatest potential for the beverage industry. The country accounts for almost 10 per cent of global beverage consumption. That makes beverage consumption in India the third largest in the world after the United States and China. Although the beverage industry has been in existence for quite some time now, yet it is still at an infant stage considering its size and place in the market. India stands at third number in the consumption of beverage, behind United States and China. It accounts for almost 10 per cent of global beverage consumption. Today, it is being looked as a country that offers the greatest potential, even more so than China. In 2013, the beverage industry in India is being estimated to grow at 17 per cent. Non-alcoholic Drinks companies actually see India as a potential market because of the kind of summer that India sees. The Coca-Cola Co reported its profit climbed 43 per cent in the second quarter to two billion dollar, getting a boost from double-digit unit case volume growth. The Indian CSD (carbonated soft drinks) market stands at 1.2 billion dollar and the fruit-based beverages and bottled water at 600 million dollar and 300 million dollar, respectively. The wine industry in India is one of the most sought after market at present and all eyes are on it. The budget announced by the finance minister is not being seen as very advantageous to the wine industry as it did not announce any significant or major benefits all round for it. It was expected to make wine sector a part of the food processing industry, which would lead to uniformity in the state-wise tax structures. The wine industry in India needs investment to grow to its rightful size of about 30 million cases (20 times the present volume) and it is possible only with lower production and marketing costs, taxes and increased competition. As far as the beer industry is concerned, age-old excise policy on liquor and multiform regulations are hitting the beer industry. The Punjab Excise Policy of 1995, which inadvertently discourages breweries, while encouraging distilleries, has put the brewers in the country in a total mess. The beer industry is clearly at a disadvantage. Repeated pleas have failed to bang the government’s deaf ear. Apart from this, the government needs to make a uniform age limit to consume alcohol. It’s different in different states. While an 18-year old guy can consume alcohol in Goa, one needs to be at least 21 to do the same in Mumbai. In Punjab, its even higher where it is kept at 25 years. The budget was expected to cut down the taxes on beer that is more than most of the countries in the world. While the average global taxes on price of the beer are 33.6 per cent, in India it’s about 49 per cent and therefore, affordability of beer in the country is lowest compared to world standards. Hence, the perception is that the government is encouraging hard-liquor which is more harmful to the consumers. However, the impact on non-alcoholic industry has been different. For e.g., packaged coconut water will be cheaper by rupees three for 200ml as the retail prices have been reduced from Rs. 15 to Rs. 12, thanks to the abolition of a 16 per cent excise duty. The finance minister has also totally withdrawn the 16 per cent excise duty on tea and coffee mixes and puffed rice. India (1002 Million kgs) along with China (990 Million kgs), Sri Lanka (318.7 Million kgs) and Kenya (286.0 Million kgs) accounts for about 75 to 80 per cent of the world’s tea production. In May, tea production in India rose to 71,374 tonnes from 70,267 tonnes a year before. However, output has declined to 215.84 million kg till May this year from 240.24 million kg in the same period last year. The budget has also made dairy majors like Amul, Mother Dairy and Nestle happy because the customs duty on bactofuges, that separates bacteria from milk and increases the shelf life of milk, and the Punjab Excise Policy of 1995, has been abolished. On a bactofuge that costs between Rs. 1.5 crore to 2 crore, the companies will benefited with Rs. 8 lakh to Rs. 10 lakh a piece. The exemption of 16 per cent excise duty on refrigeration equipment (milk chillers) will will save rs 5 lakh per chiler More and more companies are entering and creating niche for themselves in the Indian beverage industry, the latest being the fast moving consumer goods (FMCG) company ‘Dabur’. It is coming up with a new fruit flavored beverage called ‘Real Burst’. In the current scenario, many Indian food and beverage players aim to invest in Bhutan, as a follow-up of the Indo-ASEAN pact. About 11 key areas have been identified as areas with enormous opportunities in Bhutan, where Indian and Bhutanese players can invest. Agriculture, horticulture, agro and food processing, dairy, pharmaceutical, medicinal plantations are few of them. 2.2.3 REGIONAL SCENARIO In Kerala, pineapple is cultivated in area of 12,500 hectares with a production of 1,02,400 tonnes with a low productivity of 8.2 tonnes per hectare, consistently over the last few years.The congenial humid climate has favoured the cultivation of pineapple. The finest quality ‘Mauritius pineapple’ comes from Kerala. The product of Kerala is very much in demand as a fresh fruit throughout India and also in foreign countries because it is considered the best quality, sweetness and has good favour. Although pineapple cultivation is practiced in almost all districts, the major pineapple producing district is Ernakulam. It accounts for more than 60% of the area under pineapple cultivation having a share of over 60% of the total production. In Ernakulam, the pineapple cultivation is more concentrated in certain areas of Vazhakulam. In Kerala, pineapple is grown mainly as an inter crop in rubber and coconut, and also pure crop in garden land and in converted paddy fields. Pineapple fruits are produced round the year. There is immense potential to increase the area under pineapple in Kerala as it can be grown as an intercrop in coconut and rubber plantations. Coconut is grown in about 8 lakh hectares and if pineapple is grown as a intercrop in coconut garden, it will be a solace to the farmers. Special attention can be given for intercropping pineapple in coconut. Out of the 5 lakh hectares of rubber grown, above 15000 hectares is replanted every year. Pineapple is grown as an intercrop for the first 3 years in rubber at the time of replanting. Pineapple cultivation in rubber will give income to farmers during the period when there is no income from rubber. However only less than 2 % of the potential are in Kerala is cultivated with pineapple. 2.3 INDUSTRY ANALYSIS The Beverage Industry is a mature sector and includes companies that market nonalcoholic and alcoholic items. Since growth opportunities are limited, many members of the industry endeavor to diversify their offerings to better compete and gain share. Too, they may pursue lucrative distribution arrangements and/or acquisitions to expand their operations and geographic reach. Most equities in this group are suitable for conservative investors. The largest companies offer reliable dividends, with regular increases, and above-average Stock Price Stability. There are a few selections for those that are more venturesome. Such issues might serve a particular market niche, for example, energy drinks or developing overseas markets. Generally, the group turns in a steady performance throughout the business cycle, but it will suffer in the most stressful of economic times. Both the nonalcoholic and alcoholic sides of the Beverage Industry are dominated by a few sizeable players and competition among them is often intense. Changing consumer tastes adds to operating uncertainty. Pricing and margins frequently come under pressure. Also, volatile commodity costs will challenge managements to protect profitability. Good operating efficiency and cost-control practices, mostly on an ongoing basis, are important. Notably, the companies take care to hedge raw material (e.g., aluminum and carbon dioxide) purchases. Missteps in reading the trends of ingredient prices can have a measurable negative impact on earnings. We find that beverage makers with the most established brands produce the widest operating and net income margins 2.3.1 KEY PLAYERS Non Alcoholic Segment Alcoholic Segment Coca Cola Company Ace Continental Exports PepsiCo Mangalore Breweries & Distilleries limited Dhunseri Tea McDowell & Company Enkay Texofood Industries Limited- Onjus Orange Juice Ramsingh Aggarwal & Company Goodricke Shaw Wallace Kothari Plantations & Industries South Seas Distilleries & Breweries Pvt. Ltd. Nestle UB Group(Kingfisher Beer) NHN Water Technologies Vinbros & Co. Nirmitee Impex Amalgam Enterprises Camelia Overseas The major players in the fruit juices market are Pepsi with its brand Tropicana Dabur Food with its brand Real Coca Cola with its brand Maaza COMPANY PROFILE OVERVIEW OF THE ORGANISATION BACKGROUND AND HISTORY Nadukkara Agro Processing Factory Unit of Vegetable and Food Promotion Council, Keralam is located at Nadukkara in Avoly Panchayat, Ernakulam district in the heart of Kerala’s pineapple growing area. It is an ISO 22000 certified company under Food Safety Management System. The company was found in 1998 promoted by Kerala Horticultural Development Programme. In 2000, Government made it public limited with the name Nadukkara Agro Processing Company Limited with the shareholding of 30% by Government and 70% by farmers. It has been promoted by the Kerala Horticulture Development Programme (KHDP), a project funded by European Union and Government of Kerala, designed to utilize the rich agricultural potential and promote cultivation of high value horticultural crops in Kerala with key benefits going to farmers. One of the components of this programme was to establish a modern fruit processing industry for the commercial processing of pineapple, mango and other fruits for value addition and ensure supplementary income to farmers through successful transfer of technology. The programme was implemented through an autonomous programme directorate which facilitated, guided and coordinated all programme activities. NAPCL was a public sector undertaking. The company got its certificate of incorporation on December 1, 1999 from the Assistant Registrar of Companies, Kerala. On January 20, 2000 the company got its Certificate of Commencement of Business. On 02 June 2012 the Government took over the company and its assets and gave it to Vegetable and Food Promotion Council, Keralam (VFPC). The company is currently functioning as Nadukkara Agro Processing Factory Unit of VFPC. The factory has registered farmers holding 70% shares and Kerala Government holding 30%. Anyone having a 50 cent pineapple farm can own shares of the company. The beneficiaries of the factory consist of pineapple farmers of 21 panchayats, including Arakuzha, Avoly, Manjallor, Ayavana, Kallorkadu, Palakuzha, Manakkadu, Kumaramangalam, Pothanikkadu, Varapetti, Maradi, Thirumaradi, Paingottur, Paipra, Valakam, Kavalangadu, Koothatukulam, Kodikulam, Pallarimangalam, Keeranpara, Kottapadi etc. and Muvattupuzha municipality. The factory has been formed for the purpose of helping the farmers in that locality. The factory procures agricultural products from the farmers and produces high quality products. It markets it without the assistance of intermediaries. This prestigious organization is committed to the social cause of the people, which is the basic need of an organization. The brand name of the company product is ‘JIVE’. The products measure to the stickiest of international norms. They are put through stringent quality control measures at every stage of production. From the selection of best fruit to the aseptic packing there are no compromises in its quality. Modern crop management techniques, use of high quality suckers, scientific farming and post harvesting methods are incorporated. On-line analysis by qualified professionals controls the parameters during production and guarantees a final product that is consistently good. Every stage of the operation is automated with the very latest equipment from India and Europe. Even though the company originated a decade back, its fame has crossed oceans. The supply of fresh pineapple, ginger and mango comes from the registered farmers. There are 205 shareholders at present with the company. The company at present has three product lines- Concentrate line.RTS line and Candy line. 3.1.2 COMPANY VISION, MISSION AND VALUES Mission The aim of the company is to be an integerated model for the production of fruit products of international quality and achieve best value addition for the benefit of farmers. Vision To ensure the presence of companies be felt in regional, national and international markets by stepping into export of products, and to promote the interests of the farmers, by providing them income and promoting their standard of living, so that they attain self sufficiency and economic security. The company was incorporated to help the pineapple farmers of the locality to sell their products and to get a reasonable gain in their products. Technology The technology belongs to the professional production plant designers based in Italy. All the machines, equipments and technology used in the production plant are imported from Italy with the help of European Union. 3.1.3 PRODUCTS The company' business is broadly classified in to three categories:- 1. Fruit Juice concentrates / pulp 2. Ready – to serve juice / drink 3. Fruit candies 1.Fruit juice concentrate/pulp (Concentrate Line) Pineapple and mango juice concentrate/pulp in aseptic bags for bulk supplies. For institutional supplies, the pineapple and mango juice concentrate is packed in 220 ltr aseptic bag-in-drums. This line can also be used for processing of fruit pulp/single strength juice. 1.Juice Concentrate (PJC) - Industrial Pack Parameters: TSS : 60° Brix Min. pH : 3.2 - 4.0 Acidity : 2-3 % Brix Acid Ratio : 20-30 Specks : Nil Colour : Bright yellow when reconstituted Flavour : Typical Pineapple Flavour Packing : 255 kgs aseptically packed Bag in drum 2. Ready- to-serve(RTS) juice/drink The products under this business category are as follows: JIVE Punch (200 ml Mixed fruit Drink) This product contains mango, pineapple pulp (i.e. Pulp content is 15%) with added fruit flavour for direct consumption by the consumers. The product is packed in tetrapack which gives convenience for using it anywhere, anytime. The shelf life of the product is 6 months. Brix : 16: 0.50 Ph : 3-4 Brix Acid Ratio : 80 - 100 Acidity : 0.16 - 0.20 % Packing : 200 m1: 5ml 27 Packs / Carton Odour & Flavour : Characteristic odour & flavour of 3.Processed mixed Fruit Beverage JIVE Fundo (200 ml pineapple Drink) This product contains pineapple pulp (i.e. Pulp content is 15%) with added fruit flavour for direct consumption by the consumers. The product is packed in tetrapack which gives convenience for using it anywhere, anytime. The shelf life of the product is 6 months. JIVE Fundo Orange (200 ml Orange Drink) This product contains Orange concentrate(i.e. Pulp content is 10%) with added fruit flavour for direct consumption by the consumers. The product is packed in tetrapack which gives convenience for using it anywhere, anytime. The shelf life of the product is 6 months. JIVE Fundo Apple (200 ml Apple Drink) This product contains apple concentrate(i.e. Pulp content is 10%) with added fruit flavour for direct consumption by the consumers. The product is packed in tetrapack which gives convenience for using it anywhere, anytime. The shelf life of the product is 6 months. Jive Mango Joozy 500 ml & 200 ml Pet Bottles Mango Joozy is a mango drink made from delicious mangoes in South India tasting deliciously natural. This drink is an ideal re-freshener. Packed in pet bottles of 500 ml and 250 ml, it has a shelf life of 6 months at ambient storage conditions. 3. Ginger Candy (Candy Line) Made from tender varieties of ginger (Varadha/Rio-de-genera) Jive Candied ginger is a perfect mouth freshener with health benefits available in the form of 8 mm cubes. This product is packed in 75 gm tubs and 50 gm pouches. The product has a shelf life of 1 year when stored at ambient dry conditions. Parameters: Brix : 72° Brix PH : 3.4 - 3.8 Taste : Characteristic taste of candied Ginger Packing : 1 Kg. X 5 /ctn (bulk) Alternatively available in retail packs of75 GM in plastic tubs Jive Candied Ginger Baker's Grade: Jive Candied ginger Bakers' grade is a product targeting the bakery segment as an ingredient for cake and cookies production. Product is available in the form of bits of size less than 4 mm in bulk packing formats. This product has shelf life of 1 year when stored at ambient dry conditions. 3.1.4 RECOGNITIONS AND CERTIFICATIONS Recognitions Member of SGF (Society Generate de Financement du Quebec). It is an organization of fruit juice manufacturer from European community. It has certificate from IRMA (International Raw Material Association) Certifications ISO – 22000 and HACCP certification Certified by Fair trading Labeling Organization (FLO) FSMS(Food Safety Management System) certification 3.1.5 STRATEGIC PLANS & PROGRAMMES AND OBJECTIVES Strategic Plans and Programmes The product port folio of the company is being expanded to a range of new products which includes Orange Drink, Apple Drink, Pineapple syrup, candies in sachet, Tender Coconut water in Tetrapack Mango Drink in PET Bottles etc. As a major diversification they have set up an integrated pack house for fresh pineapple. This pack house is constructed following the international norms and is expected to pave way to make a quantum jump in export of fresh pineapple from Kerala. Rejects from the pack house could be used in the juice factory and will help to increase capacity utilization of the Juice concentration plant. APEDA has provided 100% financial assistance for this pack house costing Rs.387 lakh and is also arranging training for the Pineapple farmers to cultivate pineapple suitable for exports. With the extended product port folio, the company expects a quantum jump in the turn over with high returns and part of the same be passed on to the registered farmers. Objectives The main objective of the company is to carry on the business of production, processing and marketing of horticulture and agricultural production. The incidental objectives are: 1. To optimize the income of the farmers and ensuring higher yields for their produce through processing value added products by using modern technology and through direct access to the farmers. 2. To develop any land acquired or to be acquired by the company and build, construct, develop, alter or improve any such land to carry on the business of the company. 3. To carry on the business as cultivators, growers, and harvesters of agriculture and horticultural produce in connection with the main objects of the company. 4. To carry on Research and Development in agricultural and horticultural product and provide to develop and sustain higher yielding of grains of such produce. 5. To appoint agents or managers and constitute branches or agencies of the company and to conduct business through such agencies or branches within or outside India. 6. To purchase, take over or otherwise acquire any part of the business or property suitable to the business of the company. 7. To remunerate any person or company for services rendered in or about the formation of the company or the conduct of its business. 8. To enter in to contract, agreement or others for the more efficient conduct of business of the company or any parts thereof. 9. To make by- laws for the regulations of the business of the company and for its officers and staffs. ORGANIZATIONAL STRUCTURE AND DESIGN 4. ORGANISATION STRUCTURE An organization can be structured and designed in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as the branch, department, workgroup and individual. On the other hand organization design is the process of defining and coordinating organizational structure elements. This is an architectural task. The purpose is to create a design that will coordinate organizational tasks & motivate people to achieve objectives. Organizational structure affects organizational action in two big ways. First, it provides the foundation on which standard operating procedures and routines rest. Second, it determines which individuals get to participate in which decision-making processes, and thus to what extent their views shape the organization’s actions. The organization design process is often defined in phases. Phase one is the definition of a business case, including a clear picture of strategy and design objectives. This is typically followed by “strategic grouping” decisions, which will define the fundamental architecture of the organization – essentially deciding which major roles will report at the top of the organization. The classic options for strategic grouping are to organize: Behavior Function Product or category Customer or market Geography Board of Directors Managing Director Manager (Marketing) Manager (Quality Assurance & Procurement) Manager (Production) Manager (Finance & Administration) Senior Production Manager Company organization is designed so that the board of directors is the supreme authority. The body is selected from target farmers who are holding 70 % of the shares of the company. The body consists of chairman, vice chairman and 12 other members. Under the board of directors there is a managing director who controls the finance manager, administrative officer, production manager, marketing manager and quality assurance manager. There are several other officers to assist these managers who are the head of respective sections. BOARD OF DIRECTORS Adv. Paul Mathew Nellippillil (Chairman) V.K. Vijayan (Vice Chairman) Joseph Vazhakkan M.L.A Adv. P.M. Ismail George Varghese Narayanan K. V.D. Sambaji K.N. Vijayan Namboothiri Sreevalsan K. Jovan Lopez Sasikumar K. (Managing Director) A director nominated by the KHDP and Government together is vacant now. DEPARTMENT PROFILE The organization mainly has four departments and each department its own departmental heads and trainees The four departments in NAPFU are :- 1. Production Department 2. Quality Assurance & Procurement Department 3. Finance and Administration Department 4. Marketing Department 3.3 FUNCTIONAL ANALYSIS 3.3.1PRODUCTION DEPARTMENT Production is a process of transforming resource into goods/services. Production is the main function of a company. So the production department has the vital role in the company. Traditionally men, material, labour and machinery were considered to be the resources. But now the present trend shows that technology is an important input resource to production. The role of production department is to accomplish the organisation’s mission by using the resources of the firm in the most efficient effective way. The production department is headed by the Production Manager. Purchase of raw material is done by the production department itself. The payment is made through cheque to the concerned party with a credit extending up to two months time. There is no separate department for purchase. This department is responsible for the purchase of raw materials needed for production, packing, pet bottles, stationary items, machinery spare parts etc. Production manager Senior Production Manager Senior Production Engineer Maintenance Engineer Project Engineer Production Engineer Senior Utilities &Maintananc e Technition Utilities&Maintanance Engineer Shift supervisor/senior Grade operator Operator Grade1 Operator Grade 2 Junior operator General worker/Seasonal worker Fork Look Operator Utilities &Maintanance Technition Boiler operator ETP/ Fireman Senior Electrical Forman Electrician Grade 1 Electrician Grade 2 Maintenance Technician Grade1 Maintenance Technition Grade2 Production assistant PRODUCTION PROCEDURE i. Receiving raw materials ii. Decrowning iii. Primary washing iv. Spray washing v. Extraction vi. Super refining vii. Heating viii. Vapour absorption ix. Cooling x. Filling xi. Sterilizing xii. Cooling xiii. Filling xiv. Packing xv. Storing This company is having three lines of productions namely:- o Concentrate Line o Ready To Serve Line(RTS) o Candy Line 1. CONCENTRATE LINE Source : Primary Source Fig 3.3.1.1 Concentrate Line Extraction Reframe Concentration Sterilization Asceptic Filling Store In the first process (i.e.) in concentrate line method, the process starts by extracting the pulp and juices from fruits. For extracting the pulp, different methods are followed for each fruit. For e.g. when the pineapple reaches the factory they are inspected first, if approved they are moved to the production department Two workers cut the neck of the fruit and they are washed thoroughly with a machine- water sprinkler. Then, through conveyor belt, they are moved to another machine where the pulp is being extracted. In the case of mangoes, the process is the same, except that there is a machine called ‘destoner’ which removes the mango seeds. The pulp extracted is then sent to the centrifuge. It is the machine which controls the quality of the product. In some cases, the sweetness may vary and if they are low, sugar is added to it. The production process or the extraction in the case of pineapples, takes place at the rate of 3.5 tonnes / hour, and in case of mangoes 2 tonnes / hour. Concentrate is moved to cut back tank. After that, they are packed in specially designed aseptic bags. Then they are kept in steel containers. Before the pulp is being fed into the aseptic bag, they are sterilized. They are filled in 265 kg bags and 220 kg bags. Mango is processed at the rate of 2 tonnes / hour. Raw material is concentrated to 28°Bx during the mango season. 2. READY TO SERVE LINE Formulating Filtering Reheating Homogenization Sterilization Asceptic Filling Coding Tray Packing Shrink Wrapping Second line is the RTS line. The pulp collected in a pack through aseptic filling is stored. That pulp is later filtered & reheated. It again undergoes thorough mixing. This is to eliminate those particles which affects the quality. The sterilized products reach a machine called ‘Tetra pack’. Inside the Tatra pack there is a paper roll. The products passing through tetra pack automatically get packed in the paper. Thus the product is ready.A special type of paper is used in tetra pack. Using a ‘batch mixing machine’, details like batch, date, etc. are coded. This is a photo sensor machine. After ‘straw application’ the packed product will be sent for tray packing.Finally through ‘shrink wrapping’ a plastic paper is covered over the product.Now the final product is ready. The RTS line employs a Tetra Pack TBA / 9 machine with an output of 6,000 cartons / hour of 250 ml size. Cartons are automatically packed with 27 packs into a tray and shrink wrapped. 3. CANDY LINE Fig 3.3.1.3 Candy Line Fruit Preparation Cutting Branching Candying Dripping Dying Packing Exporting The third line is candy line where the production of candy occurs. Earlier candies from pineapple, papaya, mango, banana, jack fruit, ginger, etc. were made but now only ginger candies are produced. It is done using the ‘Kandimat’ techno 19GY machine. Its capacity is 12000 kgs / batch. The ginger is taken and pealed. It is cut into 8mm cubes. These cubes are dehydrated in 90°-95° heat and then sugar is added. Finally after coding details like batch, date, barcode, etc. it is ready to export. MACHINERY Supplementary machineries are used to help the main production process.The main supplementary machines are 2 generators and 2 boilers. Both of the generators have 11 KV capacities. They help in the working of the plant at the times of power failure. Two Cummins Engines are used as generators. Machine operated and hand operated equipments are used to handle the materials in the factory. Mainly there are 2 forklifts operated with power and 4 hand operated forklifts. The machine operated forklifts are supplied by Godrej and besides these, a number of coveyor belts are used for transferring the raw materials to the production section. Most of the machineries and equipments used in the factory are imported from Italy. They are fully automatic machines. Once the standards are fixed, machineries are worked till the settings are changed. Quality standards are fixed for all products. Any deviations in the standards, the products are treated as scrap. Quotations are invited from the open market for the disposal of scrap. The products are sold to the people or firms who quote higher price. These are used by small companies in the local market to produce final product since the scraps are fruit concentrates are used for making cool drinks. All the machineries used in the factory are new. The working life of the machineries can’t be predicted. The companies that supply the machineries and equipments maintain them at free cost after every 1000 hours operation. On the completion of 1000 hours of work, the machinery suppliers send their company’s maintenance team and they check the machineries and provide necessary repairs free of cost. The routine maintenance period varies from one week to one year. Some machines are maintained weekly, monthly, half yearly and sometimes yearly. TETRA PACK Tetra pack is a 3 crore worth machine. Very few companies own this machine. Some companies like milma, etc. manufactures their product here. 2 packs per second is its speed. It’s worth is almost 1.50 crores. WASTE DISPOSAL The major waste is obtained from the fruits used as raw material. Milma collects pineapple wastes. Some fruits like mango, ginger, etc. are collected and transformed into manure which is later used for pineapple cultivation. Water is collected from nearby Thodupuzha river which is purified using water treatment plant. This plant produces absolutely no pollution. FUNCTIONS OF PRODUCTION DEPARTMENT i. Plan for Production ii. Giving instructions iii. Arrange raw materials iv. Plan for manufacture v. Proper utilization of equipment vi. Reduce wastage vii. Implement production plan through floor supervisor viii. Control all process ix. To minimize cost x. Timely production COLLECTION OF RAW MATERIALS The main function of this department is to purchase the raw materials which include pineapple, mango, and ginger. The raw materials are purchased during their seasons. Pineapples are available throughout the year from farmers, mangos during May to August, ginger from January to March. Pineapples are collected from the registered farmers of the company. The company gives first priority to the registered farmers at the time of purchasing pineapples. When the availability of pineapple is not sufficient for the requirements, the firm purchases it from outside sources like pineapple market. Mangos are brought from the places like Palakkadu, TamilNadu and Karnataka. Ginger brought from the places of Vayanadu, Malabar and local markets. The pineapples are inspected by the quality assurance and procurement department before it is collected from farmers. They visit the pineapple fields and ensure the quality of the fruits. It is on the basis of weight, size and shape of the product, that quality is determined. PRODUCTION UNIT The production process starts from the purchase of crops. The raw materials come to the company, the Quality Assurance and Procurement department Manager ensures the quality of the fruits. For this the manager sorts the fruits on the basis of its weight. Then it is moved to the raw material storage area. The fruits stored in this area are covered by may for seven days. After seven days again the crops are sorted and avoid the damage ones. Then the fruits go to the washing tank. In the case of pineapples it goes to washing tank only after decrowning it. The fruits are washed in chlorine water, after washing it is transferred to the ‘Belt conveyer’ with the help of this fruits are transferred to next place. In here three labours are placed to cut the bottom of the pineapples at .5 mm. manually. This process is done for reducing the work of ‘Pinetronic machine’. After cutting it goes to another washing tank. It is only in the case of pineapples, Mangoes are directly put to the washing tank. Fruits are once again washed using a high pressure jet pump. Then the fruits are transferred to the next stage with the help of an ʻElivate conveyorʼ. RESPONSIBILITY OF KEY PERSONNEL The production department is headed by the Mr.Babu Mathew. He is the production manager of NAPFU. Mr.Babu Mathew is an experienced manager. Now he controls all the functions and activities of production department. The production manager responsible for the operations like purchasing raw materials, production and packing process etc. PURCHASE DEPARTMENT Purchase department is a subsidiary of production department. This department is responsible for the purchase of raw materials needed for production, packing materials, tetra packs, plastic covers, steel drums, pet bottles, stationery items, machinery spare parts, etc. Fig 3.3.1.4 Purchase Department Production Manager Utilities & Maintenance Engineer Utilities & Maintenance Technician The main function is to purchase the raw materials which include pineapple, mango and ginger. The raw materials are purchased during their respective seasons- mangoes from June to August, ginger from February to April and pineapple is bought throughout the year. For pineapples, the farmers enter into a year’s contract with the farmers. For ginger and mangoes they engage contractors for purchases. Mangoes are brought from Tamil Nadu and Karnataka. Whereas, ginger is brought from local market. For pineapple, for each purchase, they make spot payments and for the rest they give cheques with a credit payment of three to five months. The delivery of goods is made on lorry containers. The delivery of the material is made usually within two days time. Except for pineapple, the production takes place in accordance with the demand and so the purchase of raw materials also varies. The fruits are inspected for quality before being processed. If the fruits are rejected, they are separated from the lot and are used for making bio-composite. For the purchase of packing materials, they invite quotations from the vendors in the open market. The quotation made by the company to the vendors contain specifications regarding quality of the material, quantity of the material and price, etc. The vendors quote their prices along with the company’s specifications to the company. The company approves this only after examining all the quotations. The materials which reach the factory are, being approved, within two days time. The payment is made to the concerned party with a credit extending up to two months time. The purchase department is also responsible for purchase of materials to be distributed to the workers as compliments. They include shirts, t-shirts, wrist watches, etc. printed with company logo on them. All the legal requirements are fulfilled by the firm while making a purchase, and a separate purchase order is issued by the firm. Normally, the company keeps raw materials for the continuous production for two days. Too many raw materials cannot be stored as it may cause damage to the entire lot of materials. 3.3.2 QUALITY ASSURANCE AND PROCUREMENT DEPARTMENT The role of Quality control department is the control of quality during the manufacturing process. Quality Control Department is headed by Quality Assurance and procurement Manager. When raw materials are procured from outside the, manager assures the quality, of the raw- materials. Then it is transferred to Production Department. Nadukkara Agro Processing Unit is an ISO 22000/FSMS certified company. So the company is committed to manufacture products of best quality which stands up to any international quality norms. The company gives prime emphasis in linking the farmers on one hand and consumers on the other hand in a process that benefits both. The farmers get the most remuneration price while consumers get the fresh as well as the best product at reasonable rates. The employees are; 1. Manager Quality Assurance and Procurement 2. Quality Assurance Officer 3. Field Agricultural Officer 4. Quality Assurance Assistants 5. Field Agricultural Assistant 6. Lab Assistant 7. Sweepers STRUCTURE OF QUALITY ASSURANCE & PROCUREMENT DEPARTMENT Source: Primary source Fig 3.3.2 Quality Assurance & Procurement Department Manager (QA&P)/ Food Safety Leader) Quality Assurance Officer Field Agriculture Officer Quality Assurance Assistant Lab Assistant Sweepers Agriculture Assistant FUNCTIONS OF QUALITY ASSURANCE & PROCUREMENT DEPARTMENT Under the Manager, there are Quality assurance officer with five assistants, Field agricultural officer and one assistant. The field agricultural officer, who is an expert in agricultural sector, ensures the quality of the seeds and fertility of the soil and gives proper directions for cultivation. The quality assurance assistant gives proper assistance to quality assurance officer for maintaining quality of the final product. Modern crop management, the use of high quality planting material, scientific farming methods and post harvest techniques are encouraged and supported by the company to ensure fruits that give the best of taste and quality. The company takes every care from the selection of raw materials to the final product. By means of their online analysis system managed by well qualified professionals, all quality parameters during production are constantly monitored to ensure that the final product is produced with desired quality. Covering every stage of production, from farmers to factory and then to consumers, the company can be bold enough to be with any of world’s best –processed food producers. Stringent adherence to quality measures is made to make sure that the product the consumers gets is the best. The following analysis is conducted by Quality department:- 1. Colour, flavour and taste 2. Pulp percentage 3. Acidity analysis 4. Water analysis 5. PH checking 6. Segregating of candy etc. Quality policies 1. Maintain the international standard of ISO 22000,HACCP and FSMS 2. Satisfy the customer continuously. 3. Strengthen the agricultural community welfare. 4. Provide raw materials in time. 5. Ensure continuous improvement in quality of the product. 6. Increase the sale of FMCG products. 3.3.3 FINANCE AND ADMINISTRATION DEPARTMENT FINANCE DEPARTMENT The role of finance department is proper utilization of funds. The finance department is headed by the Finance manager. Finance is one of the most primary requisites of business and the modern management obviously depends on the efficient management of the finance. The main sources of funds of the company are funds from the European Union and Kerala Government. And also some grants are given by the State Government. The assets of the company cost Rs.40 cores. Finance manager manages the working capital. The stability of a company depends on the proper utilization of funds. First and important process in the finance department is Book Keeping. The Finance Manager is responsible for all the activities of the finance department. He is responsible for the procurement and distribution of funds. He is also responsible for the purchase of materials and sales of finished products. There are 6 persons in the finance department:- 1. Finance Manager 2. One accounts officer 3. accountant 4. Accounts clerks 5. Store – in – charge 6. Senior store supervisors 7. Stores assistant Financial functions are; 1. Wages payment 2. Provident funds 3. Cash payments 4. Bank dealings 5. Central excise 6. VAT 7. Export related works etc. STRUCTURE OF FINANCE & ADMINISTRATION DEPARTMENT Source : Primary Source Fig 3.3.3 Finance and Administration Department Account officer Accountant Accounts Clerk Administration office assistant Garden worker Manager (Finance& Administration) Store –in- charge Sales Accountant Administration officer Senior Store Supervisor Stores Assistant Attender-cum-driver Books maintained by the accounting department:- Day book Cash book Ledger Payroll Accounting package used – Tally 9.3 Basis of Accounting:- The financial statements are prepared under the historical cost conversion on actual basis. Fixed Assets:- The assets transferred from Kerala Horticulture Department Programme are accounted at the value at which they are transferred. Now they are with Vegetable and Food Promotion Council, Keralam. Depreciation:- Depreciation is provided on written down value method at the rates prescribed in the schedule. Inventory:- Basis of valuation; Stores and spare parts : at cost Raw materials : at cost Finished goods : at cost or market price whichever is less Packing material : at cost Fuel : at cost Preliminary expenses are being written off over a period of 10 years. The company signed a contract with KHDP for working capital loan budgeting 440 lakhs. For this the company has already leased its properties, stocks & credits. The company is paying 10% normal interest. The company has to pay back the whole amount and the interest within 10 years. Since the company failed to do so the assets were taken over by Vegetable and Food Promotion Council, Keralam, the successor of KHDP.VAT is charged at 12 %. RESPONSIBILITIES OF KEY PERSONNEL The finance department is headed by the Mrs. Celine P. Thomas; she is the finance manager of NAPCL. Mrs. Celine is the responsible person of all the activities of finance department like finding of working capital, ensure profitability etc. ADMINIATRATION DEPARTMENT The administration department under the finance and administration department looks into the human resource activities of the company. It manages the workers and employees in the best possible manner. ADMINISTRATION DEPARTMENT STRUCTURE Fig 3.3.3.1 Administration Department The production unit is machinery oriented. So, the number of manual labour is less. The total strength of employees and workers are:- Regular Employees : 129 Seasonal Workers : 70 Because of no hard work in the company male and female workers have equal importance. WAGE AND SALARY The wage payment is made weekly. According to this the current week’s payment is made on the next made on the succeeding Wednesday of every week. The office staffs’ salary is given on a monthly basis. The workers are appointed on the basis of contracts. In the case of office staffs, the duration of contract is minimum 3 years after which they can leave the organization or continue with a new contract. WORKING TIME There are three shifts of work in the company in the production, and quality control and procurement departments. The timings are:- Shift 1 : 6 am – 2 pm Administrative officer Manager Finance & Administration Shift 2 : 2 pm – 10 pm Shift 3 : 10 pm – 6 am Each shift has duration of 8 hours. The company provides 30 minutes lunch break for the workers. The employees in the office work in the general shift from 9 am – 5 pm. SELECTION PROCESS The company follows a selection procedure to select the workers. They put public notification in leading 2 – 3 main newspapers in the southern and northern regions. From the candidates applied, they short list the candidates according to their qualifications. The selection from them will be done by an interview/selection board. This board will be consisting of one government representative, one subject expert (external), two directors, the respective department head and the MD. The selected candidates will be issued the probationary appointment order and they will enter into one year probation with salary of 10 % reduction from actual salary. Their performance will be appraised and if not satisfied the probation period can be extended to a period of six months. If their performance is not satisfactory they can be terminated without any notice. If their work is found satisfactory the contract of appointment order with duration of two years will be issued to them and they will be absorbed into a pay scale. After two years they will come in front of the screening committee. If they have their performance appraisal marks above 60 % their employment will be regularized. Otherwise the period will be extended to another six months. If their marks are not yet acceptable they will be terminated with one month notice. BENEFITS The workers get all the benefits like PF, ESI and medical insurance. The machine operators get in addition to this, DA, HRA, washing allowance, risk allowance and shift allowance. PF makes 12 % from employees and 12 % from employers itself. Double payment is given for overtime working and on all Sundays they get double payment. If the operator works for more than 12 hours continuously, he is provided with Food Allowance. The office employees get basic pay, DA, HRA, conveyance allowance and washing allowance. The managers are given newspaper allowance also. Mangers and officers are given lunch allowance too. According to Company’s Act 58 is the retirement age of employees. If they take voluntary retirement or resigns from the job before that age, they will get quarter pension till they reach the age of 58. 5 % of the actual pension is given and it will be getting reduced from the pension fund. Pension is based on the salary the person got on the last day of his employment. The employees who have completed 5 years of continuous service are eligible for getting gratuity. Gratuity = 1 day salary * 50 * number of years of service 1 day salary = one month gross salary / 26 If the gross salary is equal to or below Rs.15,000, the employees are eligible for Employee State Insurance (ESI) Scheme. The employee contributes 1.75 % and employer contributes 4.75 % of gross salary of one month towards it. WELFARE ACTIVITIES Employee’s Welfare Association of Nadukkara Agro processing Unit is a registered association. Employees contribute Rs.50 per month towards it. It provides canteen to employees with food items of subsidized rates. It does the recreational activities like annual day, annual tour, etc. The company provides uniforms and does the arrangement of proper working conditions such as – proper lighting, fresh air, drinking water, ventilation, reading room, canteen, etc. PERFORMANCE APPRAISAL The performance appraisal of employees in probation is done by a screening committee to regularize them. It is done with the help of the confidential report regarding their performance given by the department head. The performance appraisal of all other employees is done by their immediate supervisors. It moves up in the hierarchy with each employee as per their designations. TRAINING PROGRAMME The company conducts two types of training for employees and workers. Performance based training: - during each six month, superior officers assess their subordinates. They assess their performance and identify their training needs and give training. Training by internal faculty is provided here by the department heads and supervisors. For the technical staff sometimes training by external faculty will be required. As per ISO 22000: FSMS training is provided to all employees regarding hygiene in work place. Off the job training: - In this method of training, the workers undergo training for a specific period away from their work place. Fire and safety training is provided outside the company premises. Since the company is a member of Confederation of Indian Industry, it participates in its training campaigns. The training feedback by trainees and trainers is filed and signed by CEO. GRIEVANCE HANDLING Grievance is written complaint filed by an employee claiming unfair treatment. In an industrial enterprise, an employee may have grievance because of long work hours, non fulfillment of terms of service by the management, unfair treatment in promotion, poor working facilities, etc. there is no particular grievance settlement forum in the company. The employees give their grievance to their immediate superiors. Then they discuss and take decisions. LEAVE PROCEDURE According to the leave procedure of the company, there are four types of leaves provided to the workers- Casual leave, ESI leave, Earned leave/Privilege leave and Sick leave. Casual leave: - There are 12 casual leave per year. That is there is 1 casual leave per month. ESI leave: - If the ESI privileged employees are having health problems to work, they can go to the ESI dispensary. The doctor can give him leave and he cannot work during that period in the company and he cannot be made to do any kind of work in the company. The salary for that period will be provided by the ESI Corporation. Sick leave: - There are 15 days sick leave per year for the ESI unprivileged employees. Earned/Privilege leave: - If the employee works continuously for 1 year, he can take 30 leave in the next year. Of this, 20 leave he can surrender in 3 installments. Before taking the earned leave a 1 week notice must be given in the office. The leave procedure is that the worker gives a leave application to his/her immediate supervisor. From the supervisor it goes to the Manager and the Manager sanctions the leave. ATTENDANCE For marking attendance, electronic punching system is used. Card is given to each worker and the card is punched with the machine in the Security Office when they come into and go out of the company. A grace time of 10 minutes is provided to the employees. If they come after 9:10 am, 30 minutes work time will be cut. If they come after 9:30 am, their half day will be cut. Each month the employees have permission to be absent for 3 hours which can be taken at 3 different times. TRADE UNIONS Trade unions are for the benefit of workers. A trade union must have 7 minimum members to get registered. If 20 % of workers are present in a union, it will have bargaining power. If one trade union is having 51 % strength, it will have single bargaining power. Staff and operators have 1 union and the workers have 3 unions. The main unions are: Nadukkara Agro Processing Factory Employee Union (parent union- AITUC) Nadukkara Agro Processing Factory Workers Association (parent union-CITU) Nadukkara Agro Processing Company workers Congress (parent union-INTUC) A union affiliated to Ernakulam District Industrial Estate Mazdoor Sangh (parent union-BMS) KHDP Food Processing Factory Employees Association (parent union-CITU) 3.3.4 MARKETING DEPARTMENT The role of marketing department is planning, implementing and controlling of marketing activities. The objective is to increase profit and goodwill of the enterprise and to satisfy the needs and wants of the customers. This department is headed by Marketing Manager. The Marketing Manager is responsible for all the marketing and sales promotion activities. There are two marketing managers in NAPCL. One for managing the marketing process inside Kerala, and another is for marketing the product outside the Kerala. The minimum qualification for the Marketing Manager is an MBA graduation with minimum 5 years of experience in this field. The Marketing Manager regularly visits each Sales Officer’s area and evaluates their performance. He appreciates the Sales Officers who achieve targets and persuade them to improve their marketing activities. He also gives suggestions to improve the market share of the product. Conventional Marketing:- Marketing Policy of the NAPCL is Conventional Marketing. The products that are mainly exported are mango pulp and concentrate. Within Kerala, the products are directly supplied to the retailers through the agency. Outside Kerala, the products are distributed through distributors. The distributors get commission on the basis of sales. SELECTION PROCESS OF DISTRIBUTORS:- Te distributors can be selected mainly through the following 3 ways, 1. Junior Sales Executives observe the distributors who deal with other products and make them distributors of the company. 2. Through a direct contact with selected distributors. 3. Distributors who make direct contact with company. SELLING PROCEDURE The selling procedure is that, the orders are given to the Marketing Manager, after his inspection, it is transferred to the Accounts Section. Here all the accounting procedures take place and, prices are fixed and the terms of payment are also made. Then the file is transferred to the Billing Department, where the bills are prepared and given to the Stores Department, and from there the goods are dispatched. The market is segmented district wise. Sales support schemes are adopted by the company to increase the sales volume. Sales forecasting is done on the basis of previous sales. A well planned sales forecasting makes good sales. For sales officers, targets are fixed. If they achieve the targets they get incentives. The jive products have a shelf life of 6 months. Within 6 months whatever may be the damage, the company replaces the products without any additional costs. The price deciding factor of the product, ‘Jive’ is the demand for the product in the market. Product wise analysis is made to know about the movement of the products. If any difficulty is found, they adopt new strategies to improve the movement of the product. The company has also opened its directly controlled sales outlets in important places like Railway Stations, Airports, etc. To improve the sales the company participates in programs like exhibitions and sponsor some events to make the company get noticed in the market. The company enjoys Tax Concessions from the Kerala Government within Kerala. It is an aid from the government to promote the company. Outside Kerala, the company pays taxes according to the rates fixed by each state government. The company allows 21 days credit on the security of cheques. The distributors will have to pay the amount within this period. STRUCTURE OF MARKETING DEPARTMENT Source : Primary Source Fig 3.3.4 Marketing Department Marketing Manager (Kerala operations) Marketing Manager (upcountry operations) Area Sales Manager Area Sales Executive Sales Officer Marketing assistant Logistic Assistant Interring Sales representatives FUNCTIONS OF MARKETING DEPARTMENT MARKETING OF ‘JIVE’ OUT SIDE KERALA Jive was marketed outside Kerala from 2003. Now it is available in the states like Delhi, Haryana, Jammu & Kashmir, Utter Pradesh, Rajasthan, Maharashtra, Chandigarh, Orissa, Karnataka, Tamil Nadu, Andhra Pradesh etc. One tetra pack plant was established in Chandigarh in 2009. Main customers:- Indian Railway Indian Airlines Navy Canteen Amusement parks like Veega Land, Dream Land etc. Theatres COMPETITORS Now the main competitors of NAPCL are Frooty, Mazza, Milma, Slice, Mango Time, Sparta, Sip On, Real, etc. ADVERTISEMENT Advertising is a tool of marketing to influence the customers to buy the product. Advertising Medias are:- Painted displays Magazines & journals Posters Hoardings Marketing objectives:- To establish corporate image. To make jive products visible in the market through the effective market coverage and penetration. To cover the entire market at shortest period and develop brand image. To make jive variable and efficient. 3.4 ORGANIZATIONAL ANALYSIS 3.4.1 FINANCIAL ANALYSIS Financial statement analysis is largely a study of the relationship among the various financial factors in a business as disclosed by a single set of statements and a study of the trend of these factors as shown in a series of statements. SALES AND EXPENSES OF NAPFU Table 3.4.1 Sales and Expenses Particulars 2008 2009 2010 2011 2012 Sales 104688216 111723287 118016546 156382059 154856847 Expenses 105691503 113623825 122225878 152512142 146875239 Fig 3.4.1 Relationship between sales and expenses Interpretation The sales and expenses were more or less the same till 2009. In 2010 the expenses were greater than the turnover which resulted in huge losses. After that sales increased more than expenses in 2011 and there was a marginal difference between the sales and expenses in 2012. The sales were greater. 0 20000000 40000000 60000000 80000000 100000000 120000000 140000000 160000000 180000000 2008 2009 2010 2011 2012 A x i s T i t l e Sales and Expenses Sales Expenses ACCUMULATED LOSS Table 3.4.2 Accumulated Losses Particulars 2008 2009 2010 2011 2012 Net loss transferred to Balance Sheet 16353046 22466264 30386241 31595765 35905940 Fig 3.4.2 Accumulated Losses 0 5000000 10000000 15000000 20000000 25000000 30000000 35000000 40000000 2008 2009 2010 2011 2012 Accumulated Losses Accumulated Losses Interpretation The company is having huge accumulated losses. It is increasing year after year. The turnover of the company is not sufficient to recover these losses incurred over the years. SUMMARY OF FINANCIAL ANALYSIS NAPFU has good sales turnover. Its sales increased from 11 crores to 15 crores in 5 years. But company has big expenses than sales. The expenses is much higher than the sales revenue earned. The company is in loss. The accumulated losses have increased from 1.6 crores to 3.5 crores in 5 years and due to this the company is getting grants from government. Company has an optimum liquidity in which presently current ratio is around 5.53 and quick ratio is around 3.11. Company is having high liquidity due to the availability of raw material in plenty. NAPFU has low fixed assets, current assets and working capital turnover. But it has good inventory turnover ratio and cash turnover ratio. The high inventory turnover ratio is due to large availability of raw materials and good sales. In the case of leverage ratios which include debt ratio and debt equity ratio, debt ratio is around 33 % and debt equity ratio is around 49 %. This means that for every one rupee of equity Rs.49 is debt. NAPFU is not a good profitable company as per the financial records. The company is in loss. So each profitability ratio like net profit ratio, return on investment, return on capital employed, return on equity, etc. are negative for the past few years. Company has not provided any dividend to its shareholders. The object clause of the company, i.e. the welfare and development of the farmers, is the main reason for these losses. Also the grants given by government are very less. Almost 3 years are taken to make any decision and this causes huge opportunity losses. More fixed assets (machinery) is there in the company due to its production nature and when these become obsolete, they can be sold only as scrap. There is no much amount with the company to purchase new machinery when required. Though the company is in loss, it has good brand image and good sales turnover. The recession has very much affected its exports. Proper cost reduction can help the company to reduce its losses and make profits. TECHNOLOGY IMPLEMENTATION IN NAPFU In this era of advanced technology, firms spend a lot care and money for the adoption of various technologies like advanced machineries, IT implementations which include ERP, SCM, CRM, etc. In NAPFU, the production is carried out with the help of well advanced machineries. The main advantage due to this is that only few workers are needed to be employed. For RTS line, the factory uses Tetra Pack machinery, very costly machinery imported from Italy. It has increased the productivity of RTS line to a large extend. NAPFU is a semi computerizes firm. Presently as a part of ERP implementation, the company has implemented TALLY 9. It helps in controlling and coordinating the various departments together. It helps the store functions and the production functions from the beginning till the end. It increases accuracy, timeliness, etc. NAPFU is using E-sign for the attendance punching system. PRODUCT PROFILE PRODUCT PROFILE The delicious fruits of Kerala are transformed into a serious of products that please customers, and at the same time provide commercial returns to the farmers who have toiled over them. The main raw material includes fruits such as mango, pineapple and ginger, sugar and some taste flavors. Mangoes are imported from Karnataka, Tamilnadu and Palakkad. Whereas pineapples are collected from its local farmers by giving a reasonable price. The company using modern machines for production. There are 3 product lines. They are. Concentrate Line The factory can process 3.5 tonnes/hour input of pineapple using a single stage scrapped surface vaccum concentrator. The finished product is aseptically packed in 220 ltr bag – in – drum. Mango is processed at the rate of 2 tonnes/hour input a during the mango season. Produce is exported as well as supplied all over India. Ready – to serve (RTS) The RTS line employs a Tetra Pack TBA/9 machine with an output of 6000 cartons/hour of 250 ml/200ml size. Cartons are automatically packed 27 to a tray and shrink wrapped. Candied fruit Tropical fruits like pineapple, papaya, mango, banana and jack – fruit can be candied using the ‘kandimat’ technology, producing high quality candy. The capacity is 1200kgs/batch. 5.1 RANGE OF PRODUCTS Totapuri Mango Concentrate (TMC) Parameters TSS: 28 0 Brix min pH: 3.6 – 4.0 Acidity Max : 1.3 % Specks: Black Specks 5 Nos/10 gms Colour: Yellow colour Flavour: Typical of well matured ripe fruits free from off flavour and taints Packing: 228 kgs aseptically packed Bag – in – drum Totapuri Mango Pulp (TMP)] Parameters TSS: 14.0 0 Brix Min pH: 3.6 – 4.0 Acidity Max: 0.7 % Specks: Black Specks 3 Nos/10 gms Colour: Yellow colour Flavour: Typical of well matured ripe fruits free from off flavours and taints Packing: 215 kgs aseptically packed Bag – in – drum .Mango Pineapple Nectra (JIVE Splash)- Ready To Serve in Tetra Pack Parameters TSS: 16.5 + 0.5 0 Brix pH: 3.2 – 4.0 Taste: Characteristic taste of mango – pineapple mix Packing: 200ml in Tetra Pack 27 Packs in a tray (9x3) Pineapple Juice (JIVE) – Tetra Pack Parameters TSS: 15 + 0.5 0 Brix pH: 3.2-4.0 Taste: Typical odour and flavour of processed pineapple juice Packing: 250 ml in Tetra Pack 27 Packs in a tray (9x3) Natural Mouth Freshner (Ginger Candy) Parameters The chewy, tasty, healthy mouth freshner Tangy taste, Soothes Stomach, Stimulates, brain, Energises body Candy from Pineapple (cubes) Parameters Brix: 78 - 81 0 Brix pH: 3.4 – 3.8 Taste: Characteristic taste of candied Ginger Packing: 1 kg x 5/ctn (bulk) Alternatively available in retail packs of 75 gms in plastic tubs Candy from Pappaya (cubes) Parameters Brix: 78 - 81 0 Brix pH: 3.4 – 3.8 Taste: characteristic taste of candied papaya Packing: 1 kg x5/ctn (bulk) Alternatively available in retail packs of 100 gms in plastic tub 3.4.2 SWOT ANALYSIS STRENGTH 1. NAPFU is located near the pineapple city, Vazhakulam. This helps the company for the purchase of raw materials in the correct time without much transportation cost. 2. The firm is using Italian machineries and technology for production process. This will ensure the quality of the product. (Jive) 3. The beneficiaries of the company consist of pineapple farmers; they hold 70% of issued capital. So it’s a valuable help to the farmers. 4. Production is fully mechanized, so fewer workers are employed and so they are easily managed. 5. The company provides value addition to the horticulture products like pineapple, mango etc. So the company can avail many benefits from the government like tax benefits, debt concessions etc. 6. NAPFU does not create any type of environmental pollution which boost up its reputation and image in the customers’ mind. 7. During the time of recruitment the company gives priority to the experienced candidate. By this way the performance of the employee will be more effective. 8. The company owns 25% share in the branded soft drink market in Kerala. 9. This is the second company in Kerala having Tetra Pack machine. So the company receives huge business opportunities. 10. Due to the good brand image of the products, the company can compete easily with other soft drink companies as customers will be more fond of it. 11. Under the ownership of Vegetable and Food Promotion Council, Keralam. So it gets many helps many grants from government easily 12. ISO 22000 and FSMS certification. This ensures the hygienity of the production plant and area and thus increases the quality of the product. 13. Preservatives free products of the company ensure the product quality and builds customer trust. WEAKNESS 1. NAPFU is promoted by the government of Kerala. So the influence is a problem faced by the company. 2. The company deals in agro products & the production is seasonal. 3. Employees are not satisfied with the factors like salary, working time, canteen etc. 4. Lack of effective media publication and advertisements. 5. In the marketing field, the freshers are not given more chances. So the lack of presence of these talented enthusiastic youngsters is a loss to the company. This affects the growth of the company. 6. Sometimes pineapple vendors sell the pineapple outside when its price increases and deliver it to NAPFU when the price decreases. Then the company buys the pineapple by giving support price. It affects the availability of raw material and cause huge expenses. 7. Customer suggestion scheme has less importance in the company. So the company does not know about the demands and complaints of customers. 8. High expenses over revenue make loss to the company. This is due to the huge costs incurred in production and maintenance, and the welfare objective of the company. OPPORTUNITIES 1. Our society is becoming more health conscious. NAPFU’s product is natural & so it has vast opportunities. 2. The company is directly supplying products to airlines, railways etc. It will boost up the brand image of the company as a good quality product. 3. As the company is situated in the pineapple city of Kerala, with the availability of sufficient raw materials, the production can be increased. 4. As it is an agro – based industry, it has vast opportunities for diversified products like jam, wine, pickle etc. 5. People know the side effect of carbonated drinks. So they choose natural drinks like JIVE. THREATS 1. Competition from carbonated drinks like Pepsi, Coca Cola etc. will reduce the market share and demand for Jive. 2. The satisfaction level of employees is very low. This will reduce their level of performance and will thus cause huge losses to the company. 3. Raw materials are seasonal, so the company cannot utilize its entire capacity to the full potential. 4. There are competitors like Frooty, Mazza, Maa, Resna, Real, Mazza, etc. which has good brand image and advertisements and market share unlike Jive. 5. Pepsi Co is working on fruit pulp export and is looking for deals with pineapple farmers in Kerala. It also imports pineapple from Thailand & Philippines. The brand image of Pepsi Co is very high and Jive will lose many of its trade chances. OBSERVATIONS The company is running in loss since the products are not well accepted by the consumers and the company has invested less on the product publicity. NAPFU motivates pineapple cultivation by providing farmers good prices and other benefits like free agricultural classes, etc. The company is indebted to and was taken over by Vegetable and Food Promotion Council Keralam since it failed in returning the cost of assets within 10 years of incorporation. Absence of customer suggestion scheme makes the company unaware of the needs, complaints and demands of the customers. The company is lacking computerization in all departments which make its technologies outdated when compared with other companies. The company is lacking a quality circle. The company is providing job for many people. The management is not following the participitative decision making process. It does not involve workers in the decision making process which reduces the workers’ commitment towards their work. At present the company sells the waste of pineapple and mango to Milma. The establishment of the company became the reason for the development of a new bridge which links Nadukkara and Arakuzha. It is promoted by European Union and Vegetable and Food Promotion Council Keralam. Employee absenteeism is huge especially in the production department even though they are regularized. It is because the workers go to daily labor jobs near to their locality in order to earn additional income. There is a friendly and warm atmosphere in the company environment. There exists friendly relationship among the workers and the superiors. SUGGESTIONS If effective media publication & advertisement is provided, the company can earn more market share since more customers will come to know about the products. A television advertisement using children and film actors is the most effective one in the current scenario. If the packing is made more attractive more customers will get attracted to buy the product which will increase its sales. If the management includes the workers in decision making process they will become more motivated and responsible and this will result in the better performance of the company. If the company makes its product reach each nook and corner of all the unreached areas, then the company can make more turn over and increase its profit and market share. If the consumer suggestion scheme is started in the company, it will be able to understand in better customer’s views regarding the products, their grievances, demands, etc. If the technologies are updated periodically, the errors occurring in operations, accounting, etc. can be reduced and the assets can be saved from becoming obsolete. If the Research & Development and marketing research which are vital inputs for the growth of the company are developed, new diversifications and enrichments of products can be done. At present, the waste of mango & pineapple are sold to companies like Milma. The waste mainly includes outer layer of mango & pineapple and the waste after the process of production. These wastes can be utilized by the company in making wine and fertilizer. If it is done, it can be an added income to the company. CONCLUSION Nadukkara Agro Processing Factory Unit of Vegetable and Food Promotion Council, Keralam is situated at Nadukkara, Avoly Panchayat, near Muvattupuzha – in the heart of Kerala’s pineapple growing area. The factory unit is under the ownership of Vegetable and Food Promotion Council, Keralam and has been established as a public limited company with registered farmers holding 70% shares and Government of Kerala30% shares. JIVE is the brand name of the product of the organization. It is also a factory for processing pineapple, mango and ginger. Most of the share holders are the pineapple farmers within the surroundings of 21 Panchayats of the company. The company has been formed for the purpose of helping the farmers in that locality. The company collects fruits from the local farmers and markets. Company gives first priority to the registered farmers when at the time of purchasing pineapples. Registered farmers get a fixed rate of 6 Rupees for their pineapples. BIBLIOGRAPHY NAPFU. ”The Refreshing Taste Of Nature” ,www.jive.co.in . Kakkanadu: Nadukkara Agro Processing Factory Unit, 2005.Web Kotler, Philip. Human Resource Management. New Delhi: New Age Publication, 2009. — Marketing Management. New Delhi: Prentice Hall of India Pvt Ltd, 2002. Prasad, L M. Principles and Practice of Management. New Delhi: Sulthan Chand & sons, 2010. Robbins, S P. Human Resource Management. New Delhi: New Age Publication, 2009.