Supply Chain Management TATA CHEMICALS LTD PRESENTED BY • • • • • • Janki Raval Jay Lodaya Lajja Reshamwala Pratiksha Rane Rohan Jadhav Vaibhav Tonde P 30 P 19 P 31 C 42 C -16 C -39 TATA Chemicals Ltd • Established in 1939 at Mithapur • Global company with interests in chemicals, crop nutrition and consumer products • It is the world's second largest producer of soda ash Vision Enrich the quality of life by offering products and services that meet the essential needs of people. Mission We shall be the most respected company in the businesses and geographies we operate in. Our growth and success will be achieved by: •Enhancing the value we deliver to our customers •Being globally competitive •Internationalisation of our business •Improving shareholder value •Commitment to corporate sustainability •Strengthening stakeholder relationships •Providing new and innovative offerings Products Chemicals Crop nutrition and agri-business Soda ash Fertilisers: Tata Paras urea, Sodium bicarbonate DAP, NPK, SSP Alkakarb Consumer products Chemicals: Caustic soda, Salt: Tata Salt, I-Shakti, Tata Salt Lite chlorine based products, Cooking soda : Tata Samunder bromine based products, New business gypsum, phosphoric and Biofuels sulphuric acids Fresh produce Sodium tripolyphosphate Cement: Tata Shudh Supply Chain • ‘Made to Order’ Supply Chain • Orders are always more than the supply of the product • The products which are considered for the Supply Chain of TATA Chemicals are Soda Ash and TATA Salt • TATA Chemicals uses SAP for the whole Supply Chain process Contd… • Soda Ash: - Prominently used in the manufacture of glass. Helps in the 'workability' or shaping of glass articles such as tableware and float glass. Major ingredient in the making of soaps and detergents. • Salt: - The company makes sodium bicarbonate for pharmaceutical and industrial use, and as a food additive Contd… • Set Price Contract for a Set Quantity with its customers • Price for the Product is fixed for a contracted period • Actual price may fluctuate in the market Procurement • Soda Ash – Natural deposits of Soda Ash are found at Mithapur. Soda Ash from Wyoming and Lake Magadi is bought through Sea route to Mithapur plant. Solvay process is used to remove the impurities. • Salt – Solar Salt is obtained from Saurashtra. The salt pans are located Okhamani in Saurashtra. Manufacturing • Soda Ash – Solvay process is used to remove the impurities. The Soda Ash produced is generally of 2 varieties – Soda Ash Light – Soda Ash Dense • Salt – Solar Salt is obtained from Saurashtra and Vacuum evaporation is done at Mithapur plant. Packaging • Soda Ash is generally packaged in 1 metric tone PP Bags PP Bags are used to protect Soda Ash from Caking. It protects Soda Ash from moisture and humidity.. • TATA Salt is packaged into 0.1kg, ½ kg, 1kg and 2kg convenient packages Transportation • The packaged goods are transported to the Mumbai Warehouse by the means of Land as well as Rail route • Similar model is applied all across the country except Cochin and for Export market. For Cochin and Export market Sea route is used. • Road Transport is the preferred means for transportation of the products to Mumbai • It generally takes 1 – 1½ days for transportation from Mithapur to Mumbai Contd… • TATA Chemicals has entered into agreement with various Transport Associations, e.g. Gujarat Truck Association, etc. • A single 3rd Party Logistics Service provider cannot handle the complete load of both Soda Ash and TATA Salt. • The loading is done generally 50 – 50 i.e. 50% Soda Ash and 50% Salt. • This is done to achieve proper weight balance and maximum space utilization. Warehousing • 2 main Warehouse’s in Mumbai namely at Taloja and at Boisar • The Temperature of the Warehouse is maintained around 30 - 35 ˚C to avoid humidity and moisture exposure to Soda Ash and Salt • Soda ash tends to cake when exposed to moisture or the atmosphere for a long time • FIFO method is used inventory control Warehousing • Quantity Committed Customers i.e. Contract for delivery of fixed amount of products all throughout the year • Warehouse closer to the Warehouse of the Buyer Company. • For e.g. TATA Chemicals has a Warehouse established near the Warehouse of Unilever and St. Gobain • Inventory of around 15 days is maintained • For e.g. if Unilever has Quantity Set Contract with TATA Chemicals for the supply of 100 metric tones/day of Soda Ash then TATA Chemical carries an inventory of 1800 – 2000 metric tones Warehousing • At Central Warehouse 10 – 15 day inventory in the form of onsite storage as insurance against delivery delays • Limited access to SAP is provided at Warehouse level • The employees at the Warehouse are provided with special PDA’s • PDA’s are connected to the online system of the company, the whole data automatically gets transferred for the Warehouse to the SAP at the Central office situated at Mumbai. Warehousing (Material Handling) • Avoid damp or humid place or where there is excessive air circulation • When storing soda ash for an extended time under adverse conditions, cover the bags with a tight fitting, impermeable sheet • Double-faced hardwood pallets are used • Warehouse floors should be dry, smooth, free of breaks Distribution • TATA Salt as mentioned above is further transported to various Depots, Wholesalers, and Retailers across the state from the Central Warehouse • The Transportation for the distribution process is carried out by the concerned Transport Association • It is normally done by the Road Transport only • EX WORKS Contract Deliver goods at his or her own place of business. All other transportation costs and risks are assumed by the buyer Distribution • OTF Customers Checks the available quantity at the central Warehouse. If the quantity available at the Central Warehouse is enough to meet the needs of Quantity Set Customers as well as OTF Customers then the distribution is done to the OTF Customers Delivery can take upto 7 – 10 days • Export customer’s • Distribution is done through the Sea route • It is carried out through the port of Kandla which is closer to the plant location of Mithapur • Same is done for Cochin Distribution • Since for distribution various Transport Associations are involved TATA Chemicals has better control over the cost factor involved in the Distribution process • Cost involved in the Owning and Maintaining of vehicles for distribution is also eliminated • Change in the daily shipment of the quantity fixed, is carried out by sending a mail to the company head office at Mumbai Problems faced • Distribution is one of the main problem areas for the company, since it is handled by various Transport Associations. Some of the problems faced by the company are Paper works required for interstate transport. Excise duty problems. Overloading of Trucks.