A Conceptual study on Supply Chain Management at Mosquito
Repellent Industry, Puducherry
Bala Sendhil Kumar. G1*, Kalairasan Karthik. P2
1Faculty, School of Management Studies, Christ
College of Engineering and Technology, Puducherry-605010
2School of Management Studies, Christ College of
Engineering and Technology, Puducherry-605010
*Corresponding Author E-mail: guru.bsk@gmail.com;
kalairasankarthik@gmail.com
This project entitles “A conceptual study on Supply Chain
Management at Mosquito Repellent Industry, Puducherry”
is based on the production of the Good Knight Active+ Booster Machine in
Mosquito Repellent Industry. Supply Chain Management is an important factor
which helps to increase the effective co-ordination between supply chain
partners and productivity. The researcher visited the production department of
the Mosquito Repellent industries. Based on the observation and discussion with
the experts in production department, the researcher formulated a case on
Supply Chain Management. The case formulated on Supply Chain Management
explains the entire operation of Supply Chain Process from the procurement of
raw material transform them into intermediate goods and then final products and
deliver products to customer through a distribution system. The SWOT analysis
was done on this case. Based on the SWOT analysis findings from the study is
formulated. The findings suggest various suggestions and recommendations. The
conclusion of the study focuses on enhancing the Supply Chain Management is
more effectively in Mosquito Repellent Industry, Puducherry.
KEYWORDS: Supply Chain Management,
Mosquito Repellent Industry, SWOT analysis.
1. INTRODUCTION:
Its sole reason for existence in the market is the omnipresent
mosquito, which makes life excruciatingly difficult for the average Indian
during summer and monsoon months. In many ways the primary factor fuelling the
explosive growth of this market – characterized by low brand loyalty and low
product involvement –has been the availability of cost-effective, mosquito
repellents.
The night-long noisy drone of mosquitoes that disturbs our sleep
is music to the ears of the Rs1,100-crore mosquito repellent industry. The
various segments in this industry are coils, mats, vaporizers, aerosols and
creams. The two new segments are personal sprays and gels.
The category-wise market shares:
Coils command nearly 50 per cent of the market share, vaporizer
refills at 20 per cent, with mats at 10 per cent followed by aerosols at 9 per
cent and the rest shared by creams, heating devices and other products.
Segment Wise Market Share
The market for insecticides and repellents has grown by 20 per
cent in 2003-04 and is estimated to grow at about 20%. The rural market for
mosquito repellents is reckoned at around Rs 173 million against a mere Rs 79
million in urban centers. The market leader of the industry is Godrej Sara Lee
Ltd. With brands like Good Knight, Jet and Hit enjoying a market share of 40%.
The Evolution:
Coils were the first mosquito repellants to be introduced in the
Indian market. The first brand of coils was Tortoise, launched by Bombay
Chemicals Ltd. (BCL) in the 1970s. In the 1980s Good Knight was launched and
mats used with electronic mosquito destroyers became extremely effective. In
the mid 1990s Karamchand Appliances created a new
segment of vaporizers with the launch of All Out. .This segment was almost
completely dominated by KAPL.
GSLL (Godrej Sara Lee Limited) could no longer ignore this growing
segment and launched its own vaporizer under the Good Knight brand in 1996-97.
In the latter half of the 1990s, the market became much more competitive, with
the entry of GSLL, Reckitt Benckiser and HLL. GSLL launched an array of brands
(all coils) like Jet Fighter (1997), Good Knight Jumbo (1999) and Good Knight
Instant one after the other The company's other brands included Banish
(mats), Hit (aerosols), Hit Lines
(chalks), Mosfree (lotion) and Hex it (spray).while
Reckitt also launched its range of mats and coils. These new entrants resorted
to heavy advertising and aggressive sales promotion tactics.
Recently two new categories of personal sprays and gels have
emerged.
MAJOR PLAYERS
v Karamchand Appliances Private Ltd. – All
Out
v Godrej Sara Lee Ltd- Good Night,
Jet, Banish, Hit
v Reckitt Benckiser- Mortein
v Jyothy Laboratories- Maxo
v Tainwala Personal Care Products- Casper
v Bombay Chemicals- Tortoise
1.1 Godrej Sara Lee Ltd - GOOD KNIGHT
Godrej Sara Lee Ltd. is a 450 crore
turnover company with brands like Good Knight, Jet and Hit. It is the market
leader in the mats segment with a share of 68% in May 2000. Good Knight has
become the most preferred mosquito repellent solution in the country. The Good
Knight brand was launched by Transelektra Domestic
Products Ltd (TDPL) in 1984. The product was innovative and perfectly priced.
Good Knight worked on a long term strategy that would capitalize on its
long-established equity. In the mid 1990s, Good Knight faced growing
competition from new coil and vaporizer products. To counter this thrust, Good
Knight re-launched its mat first as super mat and finally as Good Knight Silver
mat in 2003, with contemporary packing, superior technology and using a high
decibel campaign. Today Good Knight Silver mat is a market leader with 62% market
share.
By 1999, Good Knight also joined the battle for the coils by
launching its red coil variant. Since Good Knight was seen to be a hi-tech
brand and coils were regarded as an entry-level product, the company made sure
that it did not suffer a downgrade in consumer perception. It branded its
version as a value-added product, which lasted ten hours (compared to eight
hours in the case of most others). The color red was meant to convey power. .
The red coil category created by Good Knight is growing and has cornered 50% of
the coil market.
Good Knight entered the vaporizer segment in 1995 by launching
Good Knight liquidator and Liquid Mosquito Destroyer (LMD) machine, together as
a combo-pack. In a short span of three years, Good Knight liquidator managed a
share of 24% of the vaporizer market and 32% of LMD market based on the
strength of the Good Knight equity. The Good Knight Vaporizer lasted 30-45 days
and just had to be plugged in. Good Knight Turbo refill, a technologically
superior product, was launched in 2004. It was the right time for Good Knight
to take the plunge and gun for market leadership.
The most important USP for Good Knight is its brand equity, built
over a decade by its products and brand communication.
1.2 Karamchand
Appliances Private Ltd - ALLOUT
The name All Out is almost a generic name for Liquid Vaporizers
(vaporizers), a segment of Rs.22O crores in the
mosquito repellant industry in India. All out is the market leader in this
segment with a 70 percent market share in 2001. KAPL was almost solely
responsible for creating this segment. Within a decade of its launch, All Out
had converted a large number of customers into vaporizer users.
All out’s sales reached Rs 253 million in 1996-97. GSLL could no
longer ignore this growing segment and launched its own vaporizer under the
Good Knight brand in 1996-97. Although the initial success of All Out was
largely due to technological innovation and first-mover advantages, it was
widely believed that what had kept the brand going was strong marketing. KAPL
decided to handle the advertising for All Out on its own, surprising many
industry watchers and drawing criticism from some ad agencies. However, the
company surprised everybody with the launch of a campaign featuring an
animated, jumping frog (actually an All Out vaporizer) eating mosquitoes, which
proved to be immensely successful.
In 1998, KAPL came out with a Rs 99 pack consisting of the Pluggy and a refill. The deal, called the 'deadly offer'
was backed by heavy advertising. After KAPL's 'deadly exchange scheme,' Good
Knight’s share decreased by 9.3% in volume terms between September 1999 and
February 2000.
KAPL's distribution network consisted of around 120 distributors
across the country. Of the 900,000 outlets across the country, that sold
repellants, KAPL was available in only 18%. As this was significantly lower
than the 55% figure for RandC and 54% for GSSL, KAPL
is working towards increasing its presence.
1.3 Reckitt Benckiser - MORTEIN
Rs 585-crore Reckitt Benckiser in India is high profile
particularly because it has a range of popular products. Reckitt launched
mosquito repellent coils and mats under the brand name Mortein in 1994. Mortein is
also available in liquid and aerosol spray forms. Mortein
is the number two pest control brand in the country Mortein
sales grew by 9.2% in F12/01, as against market growth of 9%. Mortein Coil sales grew by 14.5% despite stiff competition
in the category. For Mortein the strategy is to
increase penetration of coils, enhance brand salience of other variants and tap
niche segments through a stream of innovations. Another target for 2001 is to
gather a legitimate share among vaporizers -- from 1.5 per cent to a double
digit figure. Mortein's share in mats is estimated at
roughly 15 per cent.
1.4 Supply Chain Management
The concept of SCM was first introduced by Forrester (1961), who suggested
that success of industrial business is dependent on the “interactions between flows of information, materials, manpower and capital
equipment”. But the term “supply chain” did not become popular until early
1980s (Oliver and Webber, 1982).
Supply chain management (SCM) is the process of planning,
implementing, and controlling the operations of the supply chain as efficiently
as possible. Supply Chain Management spans all movement and storage of raw
materials, work-in-process inventory, and finished goods from point-of-origin
to point-of-consumption. The definition one American professional
association put forward is that Supply Chain Management encompasses the
planning and management of all activities involved in sourcing, procurement,
conversion, and logistics management activities. Importantly, it also includes
coordination and collaboration with channel partners, which can be suppliers,
intermediaries, third-party service providers, and customers. In essence,
Supply Chain Management integrates supply and demand management within and
across companies. Some experts distinguish Supply Chain Management and
logistics, while others consider the terms to be interchangeable. Supply Chain
Management is also a category of software products.
2.
REVIEW OF LITERATURE:
SCM has been interpreted by various researchers. Supply chain
management (SCM) has been regarded as a major inter-organizational practice for
gaining competitive advantage particularly for alliances and networks with
suppliers and customers (Rungtusanatham et al., 2003;
Janvier-James, 2012). Waters (2007) defines SCM as: “the function responsible for the
transport and storage of materials on their journey from original suppliers,
through intermediate operations, and on to final
customers”. Chopra and Meindl (2001) have defined that, “A supply chain consists of all stages involved,
directly or indirectly, in fulfilling a customer request”. According to Mentzer et
al. (2001), “The systemic, strategic coordination of the traditional business
functions and the tactics across these business functions within a particular
company and across businesses within the supply chain, for the purposes of
improving the long-term performance of the individual companies and the supply
chain as a whole.” Handfield and Nichols (1999) has defined that “A supply chain
encompasses all activities associated with the flow and transformation of goods
from the raw material stage, through to the end user, as well as the associated
information flows”. According to Christopher
(1998), “The supply chain is the network of organizations that are involved,
through upstream and downstream linkages, in the different processes and
activities that produce value in the form of products and services in the hands
of the ultimate customer.” Lee and Corey (1995) has defined that, “The
integration activities taking place among a network of facilities that procure
Raw material, transform them into intermediate goods and then final products,
and deliver Products to customers through a distribution system.” Ganeshan and Harrison (1995) has defined that, “A supply chain is a network of facilities and
distribution options that performs the functions of procurement of materials,
transformation of these materials intermediate and finished products, and the
distribution of these finished products customers.” Cooper and Ellram (1993) has defined that, “SCM is an
integrative philosophy to manage the total flow of distribution channel from
the supplier to ultimate user.” According to Cavinato (1992), "The supply chain concept consists of actively managed
channels of procurement and distribution. It is the group of firms that add
value along product flow from original raw materials to final customer.” Towil, Naim, and Wikner (1992) has
defined that, "The supply chain is a system, the constituent parts of
which include material suppliers, production facilities, distribution services,
customers linked together via the feed forward flow of materials and the
feedback flow information.” Scott
and Westbrook (1991) has defined
that, “supply chain is used to refer to the chain linking each element of the
process from, raw materials through to the end customer.”
Keely L. Croxton
et al. (2001) has stated that increasingly,
supply chain management is being recognized as the management of key business
processes across the network of organizations that comprise the supply chain.
Among the strategic and operational descriptions of the eight supply chain
processes identified by members of the global supply chain forum, as well as
illustrations of the interfaces among the processes and an example of how a
process approach can be implemented within an organization. Our managers are
framed to be used in implementing supply chain management, instructors with
material useful in structuring a supply chain management course, and
researchers with a set of opportunities for further development of the field.
According to the Jari Collin et al.
(2009), the leading supply chain
companies have used to identify and design alternative supply chain solutions
according to their customers demand chains. The supplier of telecommunications
equipment found that by deploying three different supply chains that
corresponded to three types of customers demand chains it could simultaneously
improve customer satisfaction and effectiveness. The supplier of fasteners
found it could serve its different industrial customers with essentially two
supply chain designs. Our experience with innovative high tech, high design,
and machinery products in both B2B and B2C relationships has demonstrated the
benefits of customer aligned supply chains.
R. Glenn Richey Jr et al. (2009) has
stated that firms with a desire to
improve, operating in a challenging competitive environment typically
experience high levels of performance. Further, barriers to supply chain integration
can actually increase the firm’s ability to achieve firm performance as the
firm is required to make greater efforts to overcome those barriers and develop
effective supply chain linkages.
Faisal Talib et al. (2010) are to
identify the relationships among
them by comparing the identified TQM and SCM practices. It results in compares
these practices and found that management support and commitment, customer
focus, and supplier partnership are the most common practices found by the
researcher, and have the strongest impact in the integration of TQM and SCM.
3. OBJECTIVES OF THE STUDY:
The Objectives of the study are as follows
1. To study about supply chain
management at Mosquito Repellent Industry.
2. To find out the hurdles in
supply chain management.
3. To identify the communication
needs of supply chain.
4. To give suggestions for
improvements in supply chain management.
4. RESEARCH METHODOLOGY:
Research
methodology is a plan of action for a research project and explains in detail
how data are collected, analyzed and presented so that they will provide
meaningful information (C.R
Kothari, 2004). The type of research used in this study is
Exploratory Research. The source of data is Secondary Data. Data collected from a source
that has already been published in any form is called a secondary data. The
profile of the industries and production details is the secondary data used for
the study.It
may use a variety of methods such as trial studies, interviews, group
discussions, experiments, or other tactics for the purpose of gaining
information. This type of study is mainly case study oriented. Case study
involves a careful and complete observation of a social unit,
an institution, even the entire community. The type of analysis used to
analyze this case is SWOT analysis.
5. CASE FORMULATION AND ANALYSIS:
The case formulated on Supply Chain Management explains the entire
operation of Supply Chain Process from the procurement of raw material
transform them into intermediate goods and then final products and deliver products
to customer through a distribution system. Supply Chain Management is the
process of planning, implementing and controlling the operations of the supply
chain with the purpose to satisfy the customer requirements as efficiently as
possible.
Supply Chain Management is the control of supply chain as a
process from supplier to manufacturer to consumer.
Fig.1
Supply Chain Management Process
The main aim of the Supply chain management is to improve the
effective Co-ordination between the supply chain partners which results in
better productivity and deliver the goods and services to the customer at the
right time.
5. SWOT ANALYSIS:
STEP1: SUPPLIER
Strength
v The raw material which is
ordered by Mosquito Repellent Industry will be delivered in right time by the
various suppliers.
v The main raw material required
to manufacture a Good Knight Active+ Booster Machine is thermistor
which is imported from foreign country at right time.
Weakness
v When delay in importing the thermistor due to some transportation problem.
v Low quality thermistor
leads to low quality products.
Opportunities
v Alternative suppliers give the
raw material on behalf of the supplier if there is no stock.
v Demand for thermistor
in India is becoming high for Good Knight Active+ Booster Machine.
v So the supplier can get the
product in low cost without any delay in transport if the production of thermistor is produced in our country.
Threats
v Misunderstanding among the
Mosquito Repellent Industry suppliers will lead some problem.
STEP2: QUALITY CHECK IN RAW
MATERIAL
Strength
v The Quality control officers are
most efficient and well trained person.
v The Quality officer can reject
the damaged raw material as well as the product which is not fulfilling their
components according to their specification.
v The defects in production can be
minimized.
Weakness
v If the raw materials are not
checked at specified time it leads to poor productivity.
v This will lead to the loss.
Opportunities
v During the Quality checking, the
Quality officer can check each and every components of raw material.
v The Quality officer will use
latest measuring instruments for testing the components.
v Quality products will be
increasing.
Threats
v If the measuring instrument
shows the false reading, then it will affect the entire production process.
v Loss might not be controlled.
STEP3: MANUFACTURER
Strength
v Based on the customer
expectations, the products of Good Knight Active+ Booster Machine are produced.
v The Quality of the product is
tested by the well trained person. So defectives are reduced in the process.
Weakness
v Lacking in checking the process,
will lead to defective products.
Opportunities
v We can use the latest
technologies for production such as robotics and advanced technology, etc.
v Production capacity would be
increased.
v Production time and defects
could be reduced.
Threats
v Breakdown of machinery in
production process by using robotics and latest technologies, it will lead to
delay in delivery of goods and some major problems.
STEP4: QUALITY CHECK IN FINISHED
GOODS
Strength
v The Quality control officer
should set the room temperature to check the Good Knight Active+ Booster
Machine is working in various temperature degrees.
v Multi-meters are used to check
the Good Knight Active+ Booster Machine.
Weakness
v Temperature reading exceeds the
standard reading; corrective measures are not taken.
v Delay in problem identification.
Opportunities
v They can use latest technologies
to set the room temperature automatically.
v This will be helpful for the
Quality officer to check the product.
Threats
v The data sheets of temperature
reading are not maintained properly means then it will be very difficult to
identify the problems in Good Knight
Active+ Booster Machine.
v Random samples of 3 pieces in
every carton boxes will lead to defect in the product.
STEP5: CONSUMER
Strength
v Delivering innovative product
based on the customer feedback.
v No side effects in Good Knight Advanced Active+
vaporizer.
v Two modes of working: Normal
mode and Active mode.
Weakness
v Liquid smell gives some problem
while we breathe.
v Unable to use Good Knight Advanced Active+ vaporizer
in all the places.
Opportunities
v We can produce the liquid refill
without any infection, while we breathe.
v We can adopt battery mode for the Good Knight Advanced Active+
vaporizer.
Threats
v Handling with careful.
v Children’s should be kept away
from the Good Knight Advanced
Active+ vaporizer.
6.
FINDINGS FROM THE STUDY:
The main raw material required to manufacture a Good Knight
Active+ Booster Machine is thermistor which is
imported from foreign country at right time. The Quality control officer is
most efficient and well trained person. The Quality officer can reject the
damage raw material as well as the product which is not fulfilling their
components according to their specification. The Quality of the product is
tested by the well trained person so there is no defective in the product. The
Quality control officer should set the room temperature to check the Good
Knight Active+ Booster Machine is working in various temperature degrees.
The raw material which is ordered by Mosquito Repellent Industry
will be delivered in right time by the various suppliers. Alternative suppliers
will give the raw material on the behalf of the supplier if there is no stock.
During the Quality check in raw material, the Quality officer can
check each and every components of raw material. The Quality officer will use
latest measuring instruments for testing the components. So we can increase the
quality of the products.
Unchecked raw materials will leads to loss of production and even
low quality thermistor leads to low quality products.
In every stage of production process will be checked in regular interval
period.
From the study it is found that the Supply Chain Management which
is taking place in the Mosquito Repellent Industry is carried out in an
effective manner.
The communication needs in the supply chain management are the
supplier can have the flow of communication without any deviations with the manufacturer
and the manufacturer should communicate the customer in a proper way.
7. SUGGESTIONS AND RECOMMENDATIONS:
The following are the suggestions and recommendations based on the
findings:
v The manufacturer of thermistor will start their company in our country means
they can reduce the cost of it and delivery of raw material to the customer in
right time.
v The quality officer may use
latest measuring instruments for testing the components of raw material in
order to identify the minute mistake in components.
v The new employees can be given
adequate training in order to acquire finest knowledge regarding the product
manufacturing.
v The existing employees can be
supervised at regular intervals for better improvement in productivity.
v The company may take proper
evaluation regarding the product complaints from the customer.
v The information flow between the
supply chain partners should be communicated properly without any distraction.
8.
CONCLUSION:
The researcher made the research in Mosquito Repellent Industry,
located in Puducherry. The Good Knight Active+
Booster Machine of raw material if not checked properly will affect the
production and will add to the loss. Quality check is being made at regular
intervals to produce zero defect products. If the quality officer is more
efficient and a well trained person in the field of quality checking, the
quality of Good Knight Active+ Booster Machine can be produced easily. The
finished goods of Good Knight Active+ Booster Machine will give to the Customer
in the right time without any delay; the goodwill of the industries is also
increased at high level.
9.
DIRECTION FOR FURTHER RESEARCH:
Supply Chain Management is fully based on the secondary data to
find out the result. This research is made within the organization. But in
future we can extend it by getting the information from the supplier and client
by the ways of Questionnaire in the form of descriptive type of analysis.
10.
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Received on 09.05.2014 Modified on 20.05.2014
Accepted on 22.06.2014 © A&V Publication all right reserved
Asian J. Management 5(3):
July-September, 2014 page 341-346