SUPPLY CHAIN MANAGEMENT DABUR

DABUR:SCM HIGHLIGHTS
MARKET SIZE : Market capitalization-Rs 16800 cr ; Annual Revenue -Rs 3000 cr; Direct Distributor: 3,300 Total Distributor : 3600 Warehouses :5 Warehouse locations: Zirakpur, Sahibabad, Bhiwandi, Kolkata and Hyderabad SKUS : 1,000 Large LSPS :TNT Couriers,DARCL,Western Carriers, Inland road Transport Inventory Turn Ratio : 1.2 Technology provider : SAP, Accenture, Ariba Retail Outlets(Owned and Franchisee): 550,000 Shelf-fulfillment rate : 90 percent Retailer : 2.8 million

Manufacturing locations
INDIA INTERNATIONAL JAMMU UK BADDI(HP TWO PLANTS) TURKEY SAHIBABAD (UP) EGYPT PANTNAGAR NIGERIA JAIPUR UAE NARENDRAPUR(WB) NEPAL KATNI(MP) BANGLADESH SILVASSA

PRODUCTS AT A GLANCE
HEALTH CARE HEALTH SUPPLIMENT S ORAL CARE DIGESTIVE PERSONAL FOODS CARE HAIR CARE REAL JUICE SHAMPOO BLEACHES AND SOAP SKIN CARE ACTIV COOKIN G PASTE CAPSICO HOME CARE AYURVEDIC OTC ETHICAL AYURVEDIC PRODUCTS FLOOR PUDIN HARA STRESSCOM CLEANER ODOMOS COUGH AND COLD ODONIL BABY CARE WOMENS HEALTH RUBS AND BALMS REJUVENATI ON BRONCORID MADHUVAANI LIPISTAT

Daburs Share Main Competitors 58% Real and Tropicanna Active Fruit Drinks (coolers) 1% Coolers Frooti And Maaza Category Fruit Juice Hair oil Coconut base 6.4% Vatika Shampoo Vatika Hair care (overall) 7.1% 27% HLL HLL and P&G HLL, P&G and Himalaya Himani, Zhandu and Himalaya Himani, Hamdard and local Players Paras and local players

Chyawanprash
Honey Digestives

64%
40% 37%

Supply chain
Maintaining the right stocks at right place and the time Keeping low inventories and achieving with the lowest operational cost Supply chain is about getting your fundamentals right and connecting al of them together correctly to make it robust . Hence we have tweaked our supply-chain for numerous products based on strategy and market .

Dabur ensures a FIFO for both raw and finished goods to ensure the freshness of stock Dabur used IT solution like SAP APO, SAP ERP and homegrown tools for transaction , real time information , analysis and planning

Sizing up the cities

To differentiate between market demands Dabur has separate distribution strategies for rural and urban markets This enables the company to push the various product across geographies based on user status and life style RURAL URBAN

How the wheels turn

Dabur transports almost all its product India by road. Using the services of third party company, Ariba, dabur conducts reverse auctions twice a year The no. of transporter used directly proportional to from amount of business garnered from that particular sector RFQ are sent considering : Fleet range , no. of trucks , cost of business garnered during the period ,the transit time expected ,area covered across the country

Cont..
In secondary freight which is from a invoicing location to stockiest , Dabur directly negotiates with the local transporter .

Cont..
To better the method and make it efficacious ,Dabur evaluates its vendors . The parameters of evaluation are: Transit time adherence Timely placement of vehicle Number of Defects in transit

HUB AND - SPOKE

If planning is suboptimal inventories overlap hence the cost is increases so an optimum method is to be found distribute the products evenly across the country In 2009 HUB AND SPOKE MODEL was implemented Improved service level , minimize loss of sales ,replenish faster and realize an increase in turnover,

Food product have lowest shelf life and thus a turnover of 14 days FMCG products 21 days Ayurvedic products 35 days

Inventory management

Inventory management is conducted at production level, CFA level and warehouse level Supply chain for production planning is undertaken every week

Company ensure optimum inventory to ensure targeted services level taking care of veriation in demand , keeping low working capital , all the time maintaining freshness of stock This is to ensure that inventory build up should be sufficient while maintaining service level during the peak season

Warehouse management
Goods at the warehouse are shipped out batch wise This helps with easy of their production , shipping , location and sale With 5 warehouse of which only 1 is own by the company rest are run by third party used expeditiously , stocks remain in transit for 1 day and are moved out next day to an invoicing location

Supply-chain risks
An abrupt transporter strike can not be ruled out Potential risk associated with nonavailability of critical raw materials either due to crop failure or some local disturbances at supplier facilities

The way forward

Process - benchmarking against competitor is one way to assess where Dabur stands today the company leverages in-house capabilities and experience along with input from external consultant to identify areas of performance improvement

Technology the focus of Dabur is to reap benefits by optimized and constrained manufacturing plans that ultimately reduce costs and ensure better capacity utilization of factories Organization- Dabur adopt new models and way of working , it is essential that supply chain team have a mindset to adopt the new environment.

Conclusion
The movement forward comprises adjustment in technology and acquisitions , while building up the supply chain as the company continues to gain more products , through local and foreign buyouts