Memorándum de Entendimiento (MoU) entre Codelco y SQM
Western india plywood project
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A STUDY ON FUNCTIONAL AREAS IN
WESTERN INDIA PLYWOOD INDUSTRIES LTD
Submitted by
ARISA PATAN
In partial fulfillment for the award of the degree
Of
MASTER OF INTERNATIONAL BUSINESS
Under the Guidance of
BALAJI PATTABHIRAMAN
DEPARTMENT OF MANAGEMENT STUDIES
PRESIDENCY BUSINESS SCHOOL.HEBBAL
BANGALORE UNIVERSITY
AUGUST - 2012
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DECLARATION
I hereby declare that this summer report on industrial training entitled a study on
functional areas of “WESTERN INDIA PLYWOODS LTD., submitted to department of
Management studies, PRESIDENCY BUSINESS SCHOOL.HEBBAL in partial fulfillment of the
requirement for the award of the degree of MASTER OF INTERNATIONAL BUSINESS is a
original work done by me during the period of my study at the college under the supervision and
guidance of Mr. Balaji Pattabhiraman Department of management studies PRESIDENCY
BUSINESS SCHOOL.HEBBAL
ARISA PATAN
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ACKNOWLEDGEMENT
Expressing my profound gratitude & thanks to WESTERN INDIA PLYWOODS LTD.
Baliapatam and its Managing Director, P.K Mohamed for allowing us to undergo our
training in Western India Plywood’s Ltd.
I also indebted to Mr. Ratheesh (HR department) for his timely guidance and all other
Staff and Workers of the company for their kind co-operation for our successful project
completion.
I am grateful to Mr. Brahm Sharma, director of Presidency Business
School,Hebbal.Bangalore and thanks to Mr. Balaji Pattabhiraman (faculty guides) for
their throughout help in conducting the training in the most efficient way
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ORGANISATION STRUCTURE
Managing Director
Executive
Director
GM
(administration)
GM (production)
Company Secretary Chief Accountant
officer
Technical Manager Development
Manager
Marketing Head Works Manager
Central Excise Plant Manager
Sales Manager DWD
HD/PFP/PCPB
Store/P&A
Electrical
Densified
Wood Products
Plywood, Flush
door, Block board
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INTRODUCTION
Management is the process by which people, technology job tasks and other resources are
combined and coordinated so as to effectively achieve organizational goal.
The organizational study conducted at ‘THE WESTERN INDIA PLYWOODS LTD.’ Is to study
about organizational structure communication channel , span of control ,organizational culture etc. of the
organization .The relevance of the study is to understand the above mentioned facts through a real
organizational scenario.
The chief objective of the organizational study is to familiarize with the working of various
departments for a particular period, so that one can have exposure to the practical side.
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Objective of the study
To have general awareness of the functioning and management of the organization.
To understand the organization structure and working of various functional departments.
To analyze the overall performance of the company.
To understand the extent to which management theory matches with actual practices observed.
To understand and study the organization objectives and goals.
METHODOLOGY
The methodology used for this organization study is mainly in two ways. They are;
PRIMARY DATA,
SECONDARY DATA.
PRIMARY DATA
Primary data are those data which are collected first hand and thus happen to be in original
character. The primary data includes the data by questionnaires, by observing and by interviews
with the company personnel at different levels of management.
From the managers
From the office staff
Rom the workers.
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SECONDARY DATA
Secondary data are those data which have already been collected from the company such as
Business journals
Quality manuals
Annual report
Magazines broachers.
LIMITATIONS OF THE STUDY
1. Due to shortage of time and other constraints, interviews with workers were short.
2. Both managers and employees are not ready to fully reveal the data required for the
project and the document of the company are not open for the public scrutiny.
3. Lack of availability of secondary data from published journals and reports.
4. Another limitation faced was the respondents sometimes were too busy to answer
questions in detail.
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INDUSTRY PROFILE
India is one of the developing countries in the world. The small and large scale
manufacturers of the modern days played a significant role in the Socio-economic
development of the country. Our country is blessed with immense stock of natural
resources both above and beneath the soil surface. Among that trees are great bounty
to man. They provide shelter, fuel, medicines and tools for war, commerce, or transport.
Nature develops trees as a mother brings up children, making each one a separate
individual. It is an amazing sight to see the natural abstract rhythm of line, colour and
texture of wood. Nothing from nature indoors gives a long lasting enjoyment. That is
why decorative wood had as much importance in the past, having in present and will be
in future also. And another fact was that it was timber from trees, which in the early days
helped man to conquer the oceans and to fly in the air.
WOOD BASED PANEL INDUSTRY IN INDIA
Wood panel products effect considerable saving of scarce wood as compared to solid
timber. The basic types of wood based panels are;
1. Plywood
2. Particleboard
3. Hardboard and Medium Density fiberboard
Plywood
The history of plywood industry in India is old. It is more than 75 years old that this
industry started here on a very modest scale. It was in the year 1906-07 that plywood
was imported in India for the first-time valued at Rs.32 lakh. Imports rose steadily and
by 1924-25 it were worth Rs.90 lakh. Tea industry in Assam, West Bengal and Kerala
was steadily developing and it was thought that plywood industry in the form of Tea
chests production mainly for export should be developed. Accordingly two plywood
factories were started in Assam in 1923-24 but their development was steady, slow and
not potential. These were the pioneers and the resourcefulness and courage shown by
them in the early stages of growth of Plywood industry was remarkable and the industry
owes gratitude to these courageous entrepreneurs.
With the outbreak of Second World War, necessity of manufacturing tea chests locally
was very much felt and plywood industry in India is a gift of Second World War. Now
that tea chests must be produced, Forest Departments in various states started thinking
in terms of finding suitable timber for manufacturing tea chests. Experiments were made
at Forest Research Institute, Dehra Dun and it was found that plywood made from
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Indian timbers were good as imported products and therefore advised forest
entrepreneurs to set up modern factories in different States. Accordingly well equipped
plants were started at different places like Sitapur, Bangalore, Baliapatam
(Valapattanam), Dandeli and Coochbehar. Some of these factories suffered setbacks in
the post war years, as after cessation of war the vested interests tried to sabotage these
industries by trying to restart imports of tea chests. Tariff Board enquiry was held and
the Government imposed a lien on the importers to purchase Indian products equivalent
to the quantity allowed to be imported. Slowly, the Government encouraged the Indian
entrepreneurs to modernize their plants and invest substantial capital in this industry.
After 1947-48, the industry resorted to diversification of its products and block boards,
flush doors, commercial plywood, marine and aircraft plywood, produced in Indian
factories came into the market which were second to none in the world quality and
diversity of its products. Industrial licensing is governed by the Industries
(Developmental and Regulation) Act, 1951 under the wood based industry was covered.
There was no restriction of putting up plywood Mill up to 1970. The only criteria was that
the applicant was required to obtain an Industrial License which was being considered
by Ministry of Industry after consulting various Ministries including Ministry of
Environment & Forests. Forest Ministry was being consulted for ascertaining
sustainable raw material of Timber for a particular project; the wood based industry was
more or less in medium and large scale. The wood based industry was under
Compulsory Industrial Licensing 1988 whether a small scale unit or a medium/ large
unit, new undertaking or substantial expansion would require Industrial License.
During 1970 there was clear cut definition of Small Scale Sector and units having an
investment of less than 7.5 lakhs in plant and Equipment were covered under the
definition of Small Scale Sector which would be registered with the respective State
Director of Industries. At that particular stage some of the units with such investment got
themselves transferred to small scale sectors. Meanwhile there were modern
technology and machinery equipped plywood units coming up in different places in India
like North East Zone.
In 1997 the Government of India totally delicensed wood based industry as a result
more than 2000 small scale units coming up.
The potentialities of the industry can be judged from the many uses to which plywood
can be put. Apart from tea chests plywood marine and aircraft plywood there are
specific demand for the following articles from the consumers
1. Shuttering Plywood
2. Packaging Plywood
3. Plywood drums
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4. Flush doors
5. Commercial & Decorative Plywood
6. Block Boards
7. Moulded Plywood furniture and chair seats
8. Laminated picking sticks for cotton and jute textile industry
9. Sliced decorative veneers of walnut, teak, rosewood etc.
10.Compregnated wood veneers required for heavy chemical industry and electrical
industry and electrified railways.
Particle Board
Particle board is a reconstituted constructional panel particularly developed as a
substitute for natural construction wood and is made from low grade waste woods or
from certain agricultural ligneous wastes. In that respect particleboard assumes one of
the greatest importance in the wood panel products industry from the point of view of
conservation of scarce forest resources in a country.
In India the first particleboard plant was set up in late 1950s at Sitapur in UP. There are
presently about 12 wood based and agriculture ligneous waste based particleboard
units in India.
Hardboard and Medium Density Fiberboard (MDF)
Fiberboard is a board encompassing sheet materials of widely varying diversities
manufactured from refined or partially refined wood fibers or other vegetable fibers.
Bonding agents and other materials may be incorporated in the manufacture to increase
strength, resistance to moisture, fire or decay.
The first fiberboard (Hardboard) Industry was established in India during late 1950s and
first Medium Density fiberboard plant was set up in India about 20 years back.
FURNITURE INDUSRTY
The other important field is the furniture industry. Competition is keen in this industry.
Furniture manufacturers and exporters are suffering from decreasing profit margins.
Many companies strive to reduce their cost of production and increase efficiency. Some
relocate their manufacturing operations to other areas with lower operation cost. On the
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other hand, foreign manufacturers are taking steps to strengthen their domestic
production through product specialization.
To stay globally competitive, Hong Kong furniture manufacturers strive to reduce costs,
initiate quality control, improve design concepts and capability, and upgrade
management skills and increase marketing and sales effectiveness. Many
manufacturers have obtained or are applying for ISO 9000/9002 certification.
Hong Kong's furniture makers also started to develop their own brands. Furniture
manufacturers also become more careful about the choice of raw materials to meet
international standards, such as compliance with legal or other environmental
requirements in their target markets. China is the largest furniture exporter to many
countries, including the US and Japan. The total furniture exports of China exceeded
US$6,683 million in 2002, with the US being its largest market. Guangdong province is
the major manufacturing centre of furniture on the Chinese mainland. Apart from Hong
Kong, manufacturers from Taiwan and even the US have also set up production plants
on the mainland. China also offers a huge potential market for furniture makers.
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COMPANY PROFILE
Founder
Mr. A.K. Kaderkutty, the founder of the company passed away on the 14th
February,
2001. He was the Managing Director of the company from its inception up to January
1993 and afterwards he continued as Director and Technical Adviser to the company up
to time of his demise in February, 2001. Mr. A.K. Kaderkutty was considered to be the
doyen of the wood working industry in the country. Not only he built up a wood based
panel product empire in the remote part of Kerala, which became a model for the
industry within this country, and also outside, he was also instrumental in transferring
the latest technology in wood working industry into reality. He was a member of the
International Academy of Wood Science. He was very closely associated with the
Federation of Indian Plywood and Panel Industry (FIPPI), The Indian Plywood Industries
Research and Training Institute (IPIRTI) and South Indian Plywood Manufacturers
Association (SIPMA). He was closely associated with the Bureau of Indian Standards
and was the chairman of the subcommittee (BDC : 20) dealing with wood based panel
products. The Government of India recognized him and nominated him to the National
Credit Council and other committees of Central Government on different occasions. In
Kerala, he had served on the State Planning Board, State Advisory Committee on
Technical Education, Kerala State Industrial Development Corporation, and Kerala
State Electronic Development Corporation. He had also on the Board of Kerala Forest
Research Institute, Peechi and the Kerala Government sponsored Institute of
Management. He was the first Dean of the Faculty of Wood Technology of University of
Calicut.
He pioneered a lot of research programmes in wood working industry and one area to
be highlighted is the application of Radio Isotopes for upgrading the quality of ordinary
timber, for which he set up a pilot plant at Baliapatam. He was recognized by NAARI in
1984 for the pioneering efforts in this connection. He has been received various awards,
Kerala Management association Award for Outstanding Excellence, Management
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Science Award and Vyavasaya Sree Award in 1993. He was basically instrumental in
placing the wood working industry in India on the international map with his pioneering
efforts. He has served on the board of various industries within and outside the state,
besides on the Government body of IIT- Chennai, Regional Engineering College-
Calicut and Regional Engineering College- Suratkal.
Vision
Continue to remain the best Plywood-Panel Corporation in India with growth in allied
areas.
Mission
➢ To provided utmost satisfaction to the consumer through best quality and customer
care.
➢ To continuously upgrade the product through innovations and convergence of new
technology and to produce the best quality at the lowest cost
➢ To safeguard and enhance shareholders value
➢ To respect the dignity of all employees and together to become instrumental in the
development of the country while protecting the environment.
➢ To utilize the surpluses for the welfare of employees and the society at large.
Infrastructure Facilities
WIP found an optimum location. It is located on the bank of Valapattanam River,
through which water transport is possible. The factory is located near by NH 17 and also
very near to the railway station. The company is having the following infrastructural
facilities;
1. WIP is having a separate plant and sophisticated imported machineries from Germany,
Italy, USA, Sweden
2. It has a co-operative store exclusively for employees
3. Employees State Insurance is undertaken
4. Subsidies canteen facility is available both for administrative staffs and workers
5. Rest room
6. R & D with sophisticated equipments and library
7. Separate office for each department
8. The company owns trucks and other transportation vehicles
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9. Other statutory infrastructural facilities.
PRODUCT PROFILE
The major product for which the company has been the leaders in quality since 1945
is just because of its finest quality products produced as per international standards.
The products of the company are globally accepted. Over the last 50 years, through its
close knit co-ordination of various processing units, professional management and
maximum utilization of facilities available, the company has made an indelible mark in
the wood industry – a mark of glorious achievement.
Plywoods
Following are the plywood products
Air craft plywood
Marine plywood
Shuttering plywood
Cold Water Resistant Plywood
Warm Water Resistant
Boiling Water Proof
Block board
Super Block board
Flush Door
Inlay board
Product Mix
Hardboard 58.32%
Plywood 15.13%
Densified Wood 17.60%
Pre-Compressed Press Board 04.15%
Others 04.80%
Competitors
The company’s competitors include medium and small scale plywood industries. The
main competitors are
1. Jolly board
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2. Century plywood
3. Rubco
4. Novopan
5. Bhutan Board
6. Duratuff
7. Hibond
8. kit ply
Achievements and Awards
1. First to obtain ISO-9002 certification for hard board and pre-finished boards
2. It receives the CAPEXIL Export award for 2002-03 with this the company has become
eligible to be recognized as an export house
3. First to make the irradiate wood
4. First to make the aircraft plywood
5. First to make Fire Retardant plywood confirming to BS: 476 specifications
6. First to develop weather proof, marine and Fire Retardant Hard boards
7. First to make metal faced plywood
8. First to make pre finished plywoods and hard boards using OV-Cured surface finishing
technology
9. First to manufacture DAP resin in the country with indigenously developed know how.
Functional Areas
Wood
For general purpose, the wood used are Kalpine, Vellapine, Neeli, Eucali, Mullanpali
Pasupali, Red Cidar, Pula, Red Pine, Cher etc.
For decorative purpose, the woods used are Rose Wood, Teak, Mahogany, Padauyk,
Silver Oak Dhavala and Champak.
Steam
Steam is the energy used to operate the machines. The steam comes from the boiler.
There are four to five types of boiler.
1. Saw Dust Boiler
2. Fire Wood Boiler
3. Indusial Engineering and Agricultural Corporation Boiler
4. Fuel Bed Combustion Boiler
5. Thermo Path Boiler
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Chemicals
The various chemicals used in the preparation of plywood are
1. Formaldehyde
2. Aerolyte
Phenyl Formaldehyde etc.
PRODUCT HEIRARCHY
Cross CuttingLog Yard Boiling Peeling Clipping
Edging & JoiningGluingAssembling
Pre Pressing Hot Pressing Conditioning Trimming
SandingFinishing
Drying
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HUMAN RESOURCE DEPARTMENT
WIP is highly successful in management its productive human asset. Mutual
understanding between the management and workers is appreciable in of the
matter of the attainment of company’s ultimate goal.
WIP looking is a forward looking organization ,committed to identify,train,develop and
sustain its human resource in such a manner so as to integrate the individual career
aspiration of its executives with the fulfillment of the objectives. Towards this,WIP
accepts basically that of fair,equitable and performance oriented policy with
respect to its human resource
HUMAN RESOURCE STRUCTURE
General Manager is the head of the HR Department followed by the factory
executive,who deals with all the matters in the HR Department. The Personnel Officer.
The Chief Time Keeper and The Time Clerks assist him. The Time Clerk deals with
attendance ,leave and time management of the workers in shifts and in general shifts.
Besides there are also people dealing with ESI,PF Canteen Token Wages and Salary
Administration and disciplinary action.
PURPOSE
The purpose of the HR Department is:
Recruitment and selection
Job analysis, job description and job specification
Placement and induction
Training and development
Performance Appraisal
Other HRD functions
Candidates are evaluated and selected on the basis of scrutiny of application, personal,
interview and other means. Employee’s referrals are the main sources of recruitment.
Job or skill requirement has been defined department wise to clarify responsibility,
authority, and inter-intra department communication.
Training needs are identified and plans are prepared accordingly. Training is provided
according to availability of faculty and considering operational constraints.
New employees are inducted on the basis of WIP Induction Manual on-the-job training
and informal guidance. Apart from these employees attends the seminar/training
programs conducted by the external agencies.
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CLASSIFICATION OF WORKERS
In WIP Ltd., workers are classified as follows;
1. Permanent
2. Probationers
3. Substitutes
4. Temporary
5. Casual
6. Apprentice
SHIFTS
Shift working shall be regulated in accordance with the provisions of the Factory
Act.Company’s shift includes:
1 st shift : 6.30 am to 2.30 pm.
2nd
shift : 2.30 pm to 10.30 pm.
3rd
shift : 10 pm to 6.30 am.
General shift : 7.30 am to 4 pm.
Office time : 9 am to 5 pm
TICKET OR ATTENDANCE CARD
Every workman shall be given a ticket or attendance card, free of cost, showing his
number or name, classification etc. Every workman shall punch his attendance card at
the punching machine and deliver up his card or ticket at the
place provided in the time office before the commencement of each session of the shift
in a day.
ENTRANCE AND EXIT
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The workman shall not enter or leave the premises of the factory except by the
gate or gates appointed for the purpose.
LEAVE AND HOLIDAYS
1. Leave with wages will be allowed to workmen as provided for in the chapter of
Factories Act.
2. Leave for sickness, maternity and accident will be allowed to the workmen as provided
for in the Employees State Insurance Act.
3. National and festival Holidays with wages will be allowed to the workmen as provided
for in the Kerala Establishment Act.
WAGE AND SALARY ADMINISTRATION
In WIP Ltd., the managers analyze and interpret the needs of the employees so
that reward can be individually designed to satisfy their needs. Here the workers are
paid wages and the staff officers managers etc are paid salary. The wage /salary
system which WIP which follows is time rate system. Under this system workers are
paid according to the work done during a certain period of time. He is paid at the settled
rate as soon as the time contracted for is spent. The basic purpose of salary
administration is to establish and maintain an equitable wage and salary structure.
DISCIPLINARY ACTION
Any workman who is found guilty of misconducts is liable to be summarily
dismissed without notice or compensation in lieu of notice or alternatively to be
suspended for period not exceeding 4 days or to be fined up to 2% of his wages in a
wage period in accordance with the provisions of the Payment of Wages Act. Wages
and other dues, if any, due to workman whose service is terminated by way of dismissal
or discharge or retrenchment shall be paid to the workman within 2 days of termination
of his service.
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TRADE UNIONS
Trade unions are an inevitable part of a modern industry set up. Trade union
influence industrial democracy, morale, productivity. There are four trade unions in WIP
Ltd. They are;
CITU (Affiliated to CPM)
INTUC (Affiliated to Congress)
AITUC (Affiliated to CPI)
STU (Affiliated to Muslim League)
RETIREMENT
Any workman who is declared mentally unfit or found to be on continued ill-
health or reached the age of 58 (fifty eight years) shall be retired from the service
according to the Gratuity Act.
VOLUNTARY RETIREMENT SCHEME
To achieve the optimum level of manpower with the desirable average age mix as per
the changing needs of the organization.
To provide necessary manpower adjustments.
To provide monetary benefits in terms of terminal benefits and voluntary retirement,
compensation to the who opt for voluntary retirement.
BENEFITS
Statutory benefits including ESI, PF, Gratuity etc. are provided to all the
employees. Besides that WIP Ltd., provides food at subsidized rate to the workers.
Whenever any employees meet with any accident, all the expense in the course of
treatment borne by the company.
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VARIOUS ACTS FOLLOWED BY THE COMPANY
1. The Companies Act 195
2. The Factories Act, 1948
3. The Industrial Disputes Act, 1947
4. The Minimum wages Act, 1948
5. Payment of Wages Act, 1936
6. The Contracts Labor (Regulation & Abolition) Act, 1970
7. Employees’ State Insurance Act, 1948
WELFARE MEASURES
1. Employee Providend Fund [EPS]
The EPF Act was enacted in 1952. The Act is now applicable to employees drawing
pay not exceeding RS.6500 per month.The pay includes basic wages and Dearness
Allowance. Threee schemes are framed under the Act
a) The Employees PF Schemes 1952
b) The Employees Pension Scheme 1995
c) The Employees Deposit Linked Insurance Scheme 1976
This Act ia applied to every factory in which 20 or more persons are employed without
the aid of power or 10 more workers with the aid of power. 12% of employee’s wages
and equal of employer’s contribution is transferred to PF of employees wags from this to
Pension Fund of the employee.
2.Employee State Insurance Scheme (ESI)
ESI ACT ,1948 is social security legislation .The Act provides certain benefit to
employees in case of sickness ,matenity and employement injury.The coverage under
the Act ia at present restricted to employee’s drawing wages not exceeding Rs.7500 per
month.The pay includes salary,DA and HRA. The employee’s contributes 1.75% of the
wages and 4.75% of the wages is contibuted by the employer.
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CANTEEN FACILITY
Tokens are given to the workers for the food for one week. In each day they are
remitting the token in Time Office. Food is available to workers at a concession rate of
Rs.2.50 for meals and 60 paise for snacks
HIERARCHY OF HUMAN RESOURCE DEPARTMENT
Managing Director
GM
(Administration)
Factory executive
Personnel Officer Welfare officer
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PRODUCTION DEPARTMENT
Production involves conversion of raw material into finished products/ goods. It can be
briefly explained as follows.
Input Conversion process Output
In the Western India Plywood Ltd, the raw material that are used to the output is
steam wood, and chemicals. After introducing these raw materials to a series of
process the finished goods are obtained. WIP produce three categories of products,
namely, plywood, hardboard and furniture. The wood that is required for the production
is acquired from both local as well as international markets. WIP imports wood from
Malaysia, South Africa, and South America etc. In India wood is obtained from Kashmir,
Mysore, Wayanad, Andaman Iritty etc.
INDIAN TIMBER SPECIES USED IN WIP
Commercial Timber Decorative Timber
Vellapine Teak
Kalpine Rose wood
Pali Mahagany
Mullanpali White Cedar
Pashupali Kussia
Padapine Poom
Kulirmavu Beech
Mango Silver Oak
Badham, Gombia
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Red Cedar Chempak
Following are the various machinery and process involved:-
Chipping Machine for the formation of wooden chips:
These chips are transferred to the head tank for washing it using conveyor belts.
Cleaning of chips:-
This is done using boiling water. It also provides sufficient softness for the
chips. Passing through sieve does the separation of water from the chips.
Cyclone
Chips from the deliberating machine are transferred to a conical chamber called
cyclone using steam.
Defibrator
The Defibrator used in the plant is the aspluent Defibrator. The moisture content
in the chips is removed by increasing the temperature and the cleaned chips are
converted into fine powder. After grinding it with two grinding wheels of which one is
kept stationary while the other is rotating.
Pulp formation:
The powder form of wood is converted into pulp byadding sufficient quantity of
water and chemicals. The chemicals used are dilute sulphuric acid, paraffin wax and
certain resin. The pulp is then pumped into board forming section
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LOGYARD
Log yard is a lake near Baliaparam River where the logs are stored for 2 months
to 5 years. Logs are arrived from all over the countries like Malaysia, Africa Andaman
and South America. Before dipping into water, the length and diameter of the logs are
noted and given a specific number. According to necessity the logs are taken out.
Storing of wood in water make wood durable and prevents from fungus attack and
softening the wood before peeling. In WIP the layout of the log yard is such that it is
able to facilitate the free movement of the transport from one part to another. Trolley
lines are provided for easy transport of timber.
Cross Cutting
The wood from the log yard is brought in for cross cutting. The long wood is cut
into block of varying sizes ranging from 3 to 8 feet as required. Chain saw is used for
cutting the logs that works on a hydraulic system.
Boiling
This is to convert the hard timber into soft and remove the oily material. In order
to make the hardwood soft and to remove its oil content, the blocks are boiled with the
help of steam at a temperature ranging from 1200
C to 1800
C. The wood is boiled for a
minimum of 24 hours. The steam that is required is produced in boilers. After boiling
logs are cleaned and bark is removed manually and the metallic particles are also
removed which may damage the knife.
WIP has 4 types of boilers. They are,
1. Saw dust boiler
2. Firewood Boiler
3. FBC (Fuel Bed Combusting)
4. IAEC (Industrial Agricultural and Engineering Corporation)
Peeling
After boiling, the logs are peeled with the help of the peeling machine. The
output is called the veneer. Two kinds of veneers are obtained – Face and core. Both
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of them have the same quality, but the soft and smooth part is known as face and the
hard and the rough is called as core. The thickness of veneers ranges from 0.4 mm to
2.8mm. Sometimes the slicing machine is used instead of a peeler. This is mainly
used in decorative plywood.
SLICING
Mainly decorative veneers are sliced in a slicing machine. For slicing the logs are
first cut in the form of flitches from the Kohinoor Saw Mill. There are two slicing machine
vertical and horizontal. WIP uses horizontal slicing machine. This flitch is fixed on bed
and the knife is moved. Each veneer produced is stocked manually from the machine in
an order.
CLIPPING
The next process is called clipping. Clipping is the process of converting the
veneers into required size and also remove the detective part of the veneer. Here the
veneer produced from the peeler is passed throughclipper. Clipped veneers are moved
to transfer which tey are selected on to faces, cores, cross band and then dried.
DRYING:
Drying is the next process. Drying process is conducted by considering time,
steam, and thickness of wood. The machine used for this process is known as Dryad.
Usually the moisture content is reduced to 6% to 10%.
EDGING & JOINING
The majority of veneers obtained after clipping would be relatively narrow in
width, so edging and joining necessary for plywood manufacture. It includes edge
cutting, joining, taping and spicing. The dried veneer may not straight edge. Edge
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cutting machine is for straightening the edge of veneer after cutting. For this WIP has
two edge cutting machine. It is working under hydraulic or air pressure. After cutting, the
UF resin is applied on the edge of the veneers. Electric heat is used for joining the
veneers. A gummed tape is also used for joining the veneers. After joining, it is cut into
required size.
GLUE SPREADING:
Uniform distribution of glue on the surface if veneers is called glue spreading. In
WIP the roller is used for spreading of adhesive. Both side of veneer can be glued at a
time. Each machine consists of two spreading roller made up of steel covered with
rubber. The distance of the roller can be adjusted. Minimum thickness of the veneer that
could be glued on this machine is 0.3mm. Glue spreaded veneers are again dried in the
dryer. The glues used are – Urea formaldehyde, Areolyte, Melanine formaldehyde.
ASSEMBLING:
In assembling the core veneers are places in between the face veneers. The
adjacent veneers are placed in such a way that the gains are across each other.
Minimum three plies should be there in plywood.In this process, several boards are
pressed in certain temperature. The main element that should be taken as important in
this process are steam, thickness and time.
PRE-PRESSING:
Pre-pressing is the compression of panel assembly to attain to attain its final
thickness without obtaining the final polymerization or cured state of glue line. Pre-
pressing is done on the siempel kamp press. The duration of pre-pressing may vary
from 20-30 minutes depending on the adhesive.
HOT PRESSING:
It is an important process in plywood manufacturing. In hot pressing high
temperature and pressure will be applied. The temperature and pressure will be
34. 34
different to each of plywood. Temperature is used for curing the resin and pressure is
used for reducing the thickness. There are 3 types of presses used for plywood
manufacturing. They are multi daylights and working under hydraulic pressure. The
pressing time may vary according to the thickness.
CONDITIONING:
After pressing commercial plywood are dipped into the chemical tank for
2.5minutes. t provides resistance and gives strength to the board. Conditioning is the
process in which the pressed plywoodare treated with chemical water to avoid termites
and fungal attacks.
TRIMMING:
In trimming the plywood is passed into the trimming machine for cutting the sides
according to the sizes required.
SANDING:
This is the process in which the trimmed surface of the plywood is smoothened
and softened by using sandpaper or belt sender or drum sander.
Finishing
Finishing is the final step in the plywood production process. All the finishing
works such as repairing of face veneer and patch works are done carefully, fine splits,
checks, and small gaps on the surface plywood are filled with French choke powder and
airtight powder. The boards are sealed and labeled and made ready for dispatch.
SPECIALLITY PLYWOODS
1) AIRCRAFT PLYWOOD:
Aircraft plywood is used for the interior of the aircraft like in military
35. 35
and field. It is a 3 ply construction and its thickness ranges from 1mm, 1.2mm, 1.5mm.
Because of its small thickness it can easily bend as desired. Pali& White Cedar is only
used for its construction with PF resin.
2) MARINE PLYWOOD:
Marine plywood is used in the application of marine vessels. Main species for its
construction are kussia (used as face), kalpine (used as core & cross band), Red Cedar
as a whole. Sometimes Kalpine is also used as all veneers in its construction. Kussia
has good bonding strength and resistant to microorganisms. Usually 7ply of 9mm is
taken and PF resin is used for its construction.
3) SHUTTERING PLYWOOD:
Shuttering plywood are used for concrete shuttering. 3 types of shuttering
plywood are manufactured in WIP.
4) FIRE RETARDANT PLYWOOD:
Fire retardant plywood has a quality to resist the fire. BWR plywood are treated
with fire proofing chemicals such as boric, boarxetc and treated in vaccum pressure for
72 hours to get the fire proofing property.
DENSIFIED WOOD DIVISION:
Densified boars are of 3 types- low Densified board, medium Densified board,
and high Densified board. Density of these boards is 0.97 g/cc, 1-77g/cc respectively.
Kalpine and vellapine are the mainly used species. The method of manufacture of
Densified boards is slightly different from plywood in glue spreading. All the veneers
including face are also glued. PF resin is used. The viscosity of the resin is 30-45
second. After glueing veneer is dried to reduce the moisture content present in the glue.
FURNITURE
36. 36
Furniture is another product which is produced in WIP. The furniture is used by
using decorative woods like Teak, Mahogany, and Rosewood etc. The veneers are
molded in various shapes to make different types of furniture. All the furniture is long-
lasting and is with best quality. Along with this, the wastes of decorative veneers are
used to make various handicrafts products. Inlay board is an example.
HEIRARCHY OF PRODUCTION DEPARTMENT
Production manager
Production assistant
Production executive
Production supervisor
Workers
Skilled Semiskilled Unskilled Casual
38. 38
PURPOSE
To lay down the procedure for procuring/purchasing of items from domestic supplier as
well as import.
SCOPE
Procurement items like timber, chemicals, spares, instrument, oils,lubricants,fuel,
Equipment, and machinery.
Purchase department deals with all purchase of the organization, WIP has two
purchase departments:
1. Purchase department-Stores and spares
2. Purchase department-Timber
PURCHASE PROCEDURE
1. Purchase Requisition or Indenting of materials
With the help of purchase requisition purchase officer come to know the type of
materials needed in the organization. Purchase requisition is a written request sent to
inform the Purchasing Department of a need for material and surplus. Both the stores
send Stores Indent, which is duly signed by the Stores Manager and Works Manager
and is authorized by GM. The particulars of the stores Indent are entered in the Stores
Register in the purchase Register and Purchase Register in the Purchase Department
,with reference to its serial number
2. Purchasing Enquiry
Purchasing enquiry is sending in the prescribed enquiry from quoting the quantity, item,
rate/unit etc. After checking whether the required specifications are met or not they
invite quotations.
3. Receiving Quotations
A source of supply of material is selected after the receipt of the Stores Indent. Enquiry
is sent and quotations are invited from the suppliers. Usually the Purchase addresses.
The received quotation is sent to respective sections. After checking whether their
required specifications are met or not, the quotations are accepted or rejected.
39. 39
After receiving the quotation, in order to decide to whom the order should be placed, the
relevant file with Stores Indent, enquiry and quotation are sent to Works Department,
does final decision regarding the placement of order.
4. Purchase Order
Once the quotations are accepted, the Purchase Department sends the Purchase
Order. Purchase Order is the written request to supplier for specified goods at an
agreed price. It stipulates terms of delivery and terms of payment.
Three copies Purchase Department sends the Purchase Order. The original order is
sent to the supplier. The copies are sent to Accounts/Finance and respective stores
5. Receiving Materials
When the goods ordered are delivered, the Stores Department will receive the material.
Before receiving the materials a detailed inspection is carried out. The invoice is sent to
the Production Department ,which will be signed by Workers manager.
Government Orders
Orders are met against enquiry from Railways and Government. The procedure
includes:
Government notification inviting quotation
Government sends quotation
Government quotation
Government carries out inspection
Government gives the order
The sales will be 95% cash sales and 5% credit sales. In the case of Government
orders normal credit period allowing is 30 days.
The details of purchases are entered in Purchase Day Book kept in the Purchase
Department.
PURCHASE – TIMBER SECTION
This Department does the purchase of timber . There are three sources for the
purchase of timber:
40. 40
1.Local Purchase
2.Importing or Outside/intersates Purchase
3.Purchasing from Government Sourse (very rarely)
LOCAL PURCHASE
The dealer may be registered or Non-registered. Registered dealer will give Bill to WIP
Ltd. In the case of Non-Registered dealer WIP prepares a Bill and pays cash.
LIST OF TIMBERS USED
COMMERCIAL TIMBER DECORATIVE TIMBERS
Vellapine Rose wood
Kalpine Teak
Red pine Mahganauy
Penta pine Pecca
Ekoba Silver oak
Mango Kuacia
Neeli Jombi
Eucalypts Dhavala
Pali Chemaka
INTER STATE PURCHASE OR IMPORTING
In the case of inter state purchase there will be 4% sales tax. The Central State Tax
Number should be provided in the Bill.
Timber is imported as per import procedure after the MD/ED or an assigned
representative does on-site evaluation and selection. The timber logs cleared from the
port are trasported to the and log yard and stored in water.
41. 41
PURCHASE – GOVERNMENT SOURCE
Now in the case of WIP Ltd this is very rare . It can be said that it is almost
nil. For this there will be notification from the Government. The company verifies this
notification and report to the management. If the company is willing attends the auction
the Government will give the Bill.
The timber is purchased as and when it is available. After purchasing Mopoans take
care of the timber. As and when required the timber moves to the Production
Department.
PURCHASING PROCESS
The extent control on suppliers and their products/services,is the dependent on the
relative importance of the product/services on WIP’s operations
o Suppliers are selected on the basis of qualification/past experience
o Suppliers information is available with respect to records of their qualification and
subsequent performance
o Suppliers can be re-evaluated and/ other disqualified for non-performance or other
justifiablevreasons,during a Manager Review
o Material specifications are referred to in enquiries and purchase orders
o Emergency purchase can be authorised by Managing Director/Executive Director
Purchasing Information
Appropriate and adequate information about the product is provided in the purchase
order or other documents. Requirements for approval of product/process/equipment as
applicable,reference to drawing if any ,qualification requirements of personnel if any,are
intimated to the suppliers
42. 42
HEIRARCHY OF PURCHASE DEPARTMENT
Managing director
GM(Administration)
Purchase Executive
Assistants
44. 44
SALES DEPARTMENT
Sales department is a part of Marketing Department and starts only after the production
of finished goods.
The WIP products mainly takes the form of DIRECT SALES AND DEPOT SALES and
also through COMPANY AGENTS AND REPRESENTATIVES, Agents are paid service
charges against sales, there is an agency agreement with the agents.
SALES PROCEDURE
Receiving the order
Placing the order
Three copies of placement order are maintained, one copy is sent to the works
department, one copy to dispatch section and one copy s kept in the Sales Department
itself.
Preparation of Dispatch Invoice
Billing section receives dispatch invoice from the dispatch section. Four copiers are
prepared, one is kept in the sales department, if the order is booked, a copy is kept in
the hands of transporter, one copy is sent to the party who placed the order and another
copy is given to the agent.
Preparation of Dispatch Document
Dispatch Document are prepared by the Central Excise Department and Billing staff of
Sales Department as per Base documents issued by Dispatch Section.
The Depots Return Stock
Transfer invoice copy after receipt of the material. They are filed in head office depot
wise files.
Depots supply indented products to the respective customers. Sufficient no. of copies of
bills including original to customer and copy to Head Office. Depots sent sales day
book.
WIP SALES SUMMARY
When a customer approaches to purchase the products of WIP, they first place a
purchase requirement asking about the details of the department and the conditions of
sales. Then they place a purchase order specifying their requirements. The sales
department then make arrangements to schedule the manufacturing process according
to the specification and requirements in the purchase order. They prepare a production
order in triplicates, the original is sent to the factory, duplicate to the dispatching section
and triplicate is kept by the sales department.
45. 45
After the production of the required quantity of products the dispatch section prepares a
dispatch advice in triplicate. The original is send to the factory side, the duplicate is to
the billing section and the triplicate is to the dispatch section manager.
After receiving it the billing clerk prepares the bills. In case of cash sales, the cashier
sends the 1st
bill to the customer and the duplicate is kept by the accountant. In case of
credit sales the dispatch section prepares a gate pass in order to release the goods
from the factory.
In short the document connected with the sales are
Purchase requisition :-asking about the details of the products and conditions of the
sales.
Purchase Order:- if the customer satisfies with the conditions of sales he will place a
purchase order.
Production Order:- it is prepared only at the time of stock out of demanded goods.
Delivery Order:- it is prepared when the demanded goods are in stock.
Gate Pass:- in case of credit sales in order to release the goods from the factory a gate
pass is produced.
The Western India Plywood Ltd has branches or depose all over India. The branch
managers prepare the intend. The first, second and third copies are send to the head
office and the fourth copy is kept by the depose itself.
The sales department maintains the following records to keep the daily transactions:
Daily Sales Report
Sales Day Book
Stock and Sales Statement
SELLING TECHNIQUES USED BY WIP
WIP concentrates more on industrial market than on consumer market as its products
are semi finished and are used by the industries for further production. 80% of its total
sales are of hard boards.
46. 46
The techniques used by WIP are:-
Direct Sales
Agency Service
Direct Sales-
It means sales through the company directly. Many of the sales of WIP are through
direct sales. The process of the direst sales in WIP are as follows:
WIP get enquires from the market through different medias of communication and they
sent their quotations to them/ the WIP makes follow p to their quotation and make sure
that the customers are interested in their products.
When the firm receives a Receipt of Order in which the details of the department and
their units etc would have been mentioned, the sales manager makes his order to the
production department. Here any specific suggestions made by the customers and the
date of issue etc are also mentioned, the sales manager of WIP also follow up with the
production department check that the production processes are going well.
On completion of the production the sales manager of WIP give a Dispatch Order to the
concerned department to make issue of the ordered products and is sent to the
respective customers.
After supplying the billing is made an invoice is prepared which contains the following
details like:
Depot Sales
It means sales through depots. The sales procedure of the depots is same as that of the
direct sales. The goods are recorded as sold just on transfer than the sales. The price
list in each depot. Which are added with the transportation cost, carriage & freight
charges etc, excise duty is not included as they are charged at the time of actual sales,
WIP has got depots in all parts of the country.WIP also attends Many Exhibitions
and Trade Fair to improve its sales. They also have many agents who are paid
commissions on the basis of the sales they market. Some of the organization also act
as its agents. They take the company products and makes payment only after the actual
sales.
47. 47
HEIRARCHY OF SALES DEPARTMENT
Managing Director
Executive Director
Sales Executive
Depot AssistantsDispatch AssistantsSales Assistants
Sales Agents
49. 49
MARKETING DEPARTMENT
Marketing is the art of selling products. It is also defined as
societal process by which individual and groups obtain what they need and want
through creating, offering and freely exchanging products and services of value with
others.
WIP MARKETING
Due to the high standard of quality maintained by the quality control
department of this company, the product of the company have found ready acceptance
in markets both in India and abroad. The company has succeeded in arranging
manufacturing programs on the basis if firm orders, which in regularly for all types of
products. The plywood manufactured by the company is being regularly used for
manufactures of T.V cabinets, bus bodies, building constructions, railways, furniture
industry etc. The hardboard is used for partition walls, false ceiling, furniture industry
etc. The densified wood is being supplied to the electrical industries in various forms
and also to the textile and chemical industries in the form of filter plates and as
checkered boards for flooring in buses and railway coaches. The DAP and FRP
compounds are being used by the electronic and molding industries. The furniture
manufactured by the company is being absorbed the market in drawing rooms,
bedrooms, schools, office etc. The products of the company are being exported West
Germany, France,U.S.A Sweden, West Asia and South Asian countries regularly.
MARKETING STRATEGY
The strategy that has been adopted by the firm is customer oriented
WIP’s marketing strategy evolves around its product quality. The company does not aim
at making profit by competing with the local manufacturers, rather aims at Niche
Marketing. Niche marketing is typically a small market whose needs are not well
secured. The WIP Ltd follows high quality with high price policy but the consumers are
50. 50
still ready to buy their products at high price because of its quality. So the company
mainly aims quality conscious customers.
WIP Ltd has three segments namely industrial market, domestic
market and export market. About 50% sales constitute industrial sales. WIP has
positioned its brands in upper end of market and targets those segments that require
the quality it offers backed by willingness to pay. WIP’s positioning stands in product
performance and resultant value for processing stands in product performance and
resultant value for money. It is backed by WIP’s commitment to harness the latest
technologies in wood processing field and continuously upgrade its process and
machinery.
MARKET SEGMENTATION
WESTERN INDIA PLYWOOD is well-established organization manufacturing
high quality goods. Company believes in quality. In order to ensure the quality each
batch of the products will undergo quality tests. Company has an efficient marketing
strategy. The prices of WIP’s products are comparatively high, but of high quality. The
company is targeted at the high income as well as at the low-level income groups WIP
is marketing more than 300 products.
Products are segmented as;
1. Domestic
2. Institutional
3. Automotive
4. Export
51. 51
PROMOTION
Long term brand building is undertaken through personal selling and
direct mail marketing besides promotional visits by selling agents. In general
promotional activities include advertising, public relation and publicity. In the case of
WIP’s there is a separate department for public relations. But the very important point to
be noted is that till now there has been no advertising. The main promotional activities
of WIP include conducting and participating exhibitions, trade fair etc.to attract potential
customers. They have more of a direct selling approach. It has around 40 sales depots
nation wide.
DISTRIBUTION CHANNEL
Distribution channel is just like a pipeline through which water flows from a source to
final destination. Marketing channels make possible the flow of goods from a producer
through intermediaries to a buyer.
1. Zero level channel
In which the company sends catalogues, price list, data regarding major certification
etc.to the potential customers. In direct marketing company gives a cash discount of
5%-10%.
2. One level channel
Company sales depots customers
Company agents customers
52. 52
MARKETING MIX
Plywood Section
Product
WIP produce a range of plywood to suit specific requirements in both industrial
as well as domestic sector of the market. To support its philosophy of providing value
added products, only Phenol bonded boiling water resistant plywood and other superior
grades are manufactured by WIP. Some of the plywood manufactured by WIP are:
BWR treated Plywood conforming to IS:303
BWP treated Plywood conforming to IS:303
Marine Plywood conforming to IS:710
Resin Surfaced Shutting Plywood conforming to IS:4990
Fire Retardant Plywood conforming to IS:5509
Decorative Plywood conforming to IS:1328
Aircraft Plywood conforming to IS:709
PRICING
Consequent to superior raw material and additional processing incorporated
in the manufacture of WIP panel; they are more expensive than product offered by
others and state of the art technology also adds to final product cost. However the
additional perceived value arising out of such investment is more than marginal cost
addition and hence customers are willing to retain loyal to WIP’s products.
PLACEMENT
WIP’s products are sold through exclusive retail outlets, which are either
owned by the company or commission agents representing the company. In some
areas, established dealers are appointed to increase availability and reach of the
products. Company directly deals with customers
SUBSTITUTE PRODUCT
WIP’s products have heavy duties, but still it has no cost-effective
53. 53
substitutes for the reason that the end user does not allow any compromise regarding
its quality.
HARDBOARD SECTION
Product
WIP’s board ‘WESTON’ possesses superb physical and mechanical properties
and is indispensible to manufactures of automobiles, door pads, shoe heels, clocks,
fiber and drum lids among many other application. WIP’s hardboard is exported to many
countries in the world where it holds its own position against the best brand in the world.
The commonly demanded kinds of hardboards are:
Standard hardboards conforming to IS:1658
Used for manufacture of furniture, shoe heels etc.
Oil tempered hardboard conforming to IS:1658
Used in manufacture of furniture, shoe heels etc.
Perforated hardboard conforming to IS:1658
Used for interior decoration, auditorium interiors etc.
Pre finished WIPLAC hardboard
Used in automotive coach building manufacture of handicrafts, toys
PRICING
WIP is able to offer its hardboard at a very competitive price due to an efficient
production process using the latest machinery. As a result of this, product is being sold
at huge premium in the retail market.
PROMOTION
The hardboard produced by the WIP is short in supply, but the market it
serves is rapidly growing. As a result of this there is absolutely no need for any short
term promotion practices.
PLACEMENT
Hardboard is a product of mass consumption. So WIP in addition to its own
outlets utilizes the established dealer networks in various towns and cities to increase
54. 54
availability and product reach.
SUBSTITUTE PRODUCTS
Being the most economical building material used today, hardboard has
cost effective substitute material. When its economy is compared with quality control
that WIP is able to offer, hardboard offers tremendous value for money.
STRUCTURE OF THE DEPARTMENT
Managing Director
Marketing manager
Marketing co-ordinator
Business manager
Marketing officer
Executives
56. 56
EXPORT / IMPORT DIVISION
PURPOSE
To popularize the products to the international level. The company’s
Exports are carried out as per the export policy of Government of India and
responsibilities lies in the hands of the Import /Export Executive of the
company.
FUNCTIONS
Export functions are carried out by the General Manager and the Import /
Export in charge. Quotation or Performa invoice is sent to customs along
with the details of the products to be supplied with samples wherever
required for the approval.
Export orders are obtained against payment through Letters of Credit. (LC)
or other terms of payment.
Once the price is approved, the customs offer L.C, covering value, quantity,
destination of supply, specification etc, and arrange for payments according
to the terms.
On confirmation of order and consequently on the placement of order and
opening of L.C or arranging for payment according to terms of the L.C,
foreign buyer’s product note is sent to the production department to start
production strictly as per the requirement for the foreign buyer as per the
delivery schedule given by them.
As soon as the cargo is ready, necessary clearance is obtained and cargo
is moved to the nearest post or the shipment to the destination port. As
desired house stuffing is also arranged according to requirements of the
import in WIP factory by container from the port to works.
The cargo is handed over at the port to WIP’s clearing agents and they are
undertaking all the customs formalities to get a clarity for the shipment
within.
57. 57
The least possible time, including getting back to the ARM from the
customs immediately after shipment for submissions to the Central Excise
Department.
Once the shipment is effected and bill of lading obtained from the customer
agent, the shipment documents are prepared for foreign buyer and
negotiated with WIP, bankers immediately.
After negotiation of L.C of arrangement for payment according to the terms,
the payment for the cargo dispatch to the customs is obtained, customs
takes realize to the cargo on its arrival at the destination port and also
takes recent of original documents from their banker.
Proper care and supervision are taken in all process of production, packing
and sufficient care taken to ensure the product exported are of top most
quality and to keep up its product image high in the international market.
The section takes sufficient care to fix the price for export and ensure cost
reduction in all stages where ever possible such as packing, transport etc.
to obtain better financial return in each and every transaction.
Most of the products are exported to UAE, Africa, Australia, China,
Sweden, USA, Newzealand, Srilanka and other parts of the world.
HIERARCHY OF EXPORT / IMPORT DEPARTMENT
Export / Import in ChargeExport / Import in Charge
General Manager (Admin)
59. 59
STRORES DEPARTMENT
WIP has two separate stores-Hard Board Stores and Plywood store. Hard board store
keeps all the materials and spare parts necessary for the production of hard board
(except timber). Ply wood stores keep all the materials, and spares needed for the
production of plywood (except timber).
FUNCTIONS
To send Stores Indent or Purchase Requisition to Purchase Department
To receive materials, spares, tools and equipment ordered by purchase department
To ensure inspection of purchase materials
To enter the receipts of accepted items in records and return the rejected ones
To keep the materials at proper place in the stores
To maintain the safety of items from damage, pilferage etc.
To issue materials on authorized requisitions
Valuation of stock
PROCEDURE
Indenting of materials
Making purchase order by Purchase Department
After reaching the materials checking the quality, quality etc.
Receiving the materials
Materials go to stock
DOCUMENTS
Stores Indent
Goods Inward note
positive Recall
Goods Register Note
Card X
Issue Slip
Stores Warrant
61. 61
TOTAL QUALITY MANAGEMENT
Western India Plywood’s has implemented a quality management system
considering the aspects of personnel,inputs,appropriate technology and machinery for
the various operational functions such as production,marketing,purchase,maintenance
etc. The quality policy of WIP has been defined by the Managing Director as appropriate
to the long-term vision, commitment to quality, customer perception of WIP products
and other aspects of the industry. The policy is reviewed periodically during
management review for its continuing suitability. The policy is communicated to all the
employees for a clear understanding and deployment.
WIP Ltd. has separate department for total quality management and
is well known for its quality throughout the world it has recognition of ISO 9001-2000 for
one of best and standardized production system in the world. ISO provides a lot of
standard for the quality assurance. WIP has both internal and external auditing system.
Internal auditing is done every six month by the concerned department head. External
auditing is conducted mainly by the external certifying body.
The processes needed for the quality management system have been
identified and applied through out WIP. The criteria and methods needed to ensure
effective operation and control of the processes are in place
QUALITY OBJECTIVES
Suitable equipment and machinery for process control at all stages
Provision of adequate resources including raw material and personnel to ensure
consistent product quality.
Well-defined process and product characteristics, to enable monitoring, analysis and
continual improvement.
Communication of requirements of products including customer requirements, statutory
/ regulatory requirements, aspects of Quality Management System including policy and
objectives among all employees.
WORK INSTRUCTIONS
62. 62
The requirement satisfied by the WIP in order to get ISO certification
is the following
Quality Manual
Resource Management
Management Review
Product Realization
measurement analysis and improvement
QUALITY MANUAL
The system procedures deemed necessary by the quality
management system are referred in this manual. Any other document for
planning/operation/control of processes is referred in this manual. The instructions for
the specific tasks that are contributing to quality of product are referred to as work
instructions. The data generated by implementation of the system are maintained as
records, which have been referred to in the appropriate document
RESOURCE MANAGEMENT
WIP management is committed to identifying, providing and reviewing the
resources required to sustain the quality management system and improves its
performance from time to time. Resources needs also include those required to
enhance customer satisfaction by meeting customer requirement. It is ensured that
adequately skilled personnel are assigned to various operations.
MANAGEMENT REVIEW
The Management Review is held by a committee headed by the
Managing Director/Executive Director, Management Representatives and all Heads of
Departments. Management Review is performed once in six months and the minutes of
the review meeting are maintained. The Management reviews the continuing suitability
of quality policy, objectives and overall quality management system with respect to
information on performance and feed back from various review inputs.
PRODUCT REALIZATION
Realizing the product that meets the requirements involve
translating the customer’s needs and schedule into product requirements within the
facilities available, carrying out various production operations and ensuring that the
63. 63
acceptable products reach the depots/dealers and customers. Systems are in place to
provide adequate confidence about these functions.
ISO CERTIFICATION
The main objective of International Standards Organisation is to produce and publish
international standards.
The WIP Ltd is an ISO certified company. The ISO certification was awarded to the
company IN 1996 for the quality management system of the hard board and WIPLAC
prefinished boards. In May 1999 for another three years and the company has also
received the same certification for its plywood, classified wood, flush loan and block
boards. .
STRUCTURE OF TQM
MANAGING DIRECTOR
Management Representative
Quality Engineer
Trainee
65. 65
RESEARCH AND DEVELOPMENT DEPARTMENT
The WIP has an in-house R&D Department approved by the Department of Science
and Technology and Council of Scientific and Industrial Research. (CSIR). It has the
required analytical, conditioning and testing facilities for product or process evaluation,
rigid quality control and new technology analysis. The testing equipment available
consists of the standard machines for conducting physical, mechanical and electrical
test of all kinds. They include a weather-o-meter in which the extreme weather
conditions of the world can be simulated in accelerated manner in order to arrive at
quick inferences. Karl Fischer, titration equipment, Torque Rheometer and Permeable
gel, Chromatogtaph are available in the testing lab of WIP’sR&D division for accurate
analysis of rawmaterail and finished products, the products developed and modified by
the R&D division include DAP (Di-Allyl phthalate) Moulding powder and fibre glass
reinforced plastic, sheet Moulding Compound (SMC). which find use in the manufacture
of sophisticated products required in highly specialized electrical and electronic
applications.SMC can also be overlaid on Plywood and Hard board. The manufacture of
DAP moulding has been achieved for the first time in South East Asia in the WIP. This
has put India on the road to self-reliance in the material of strategic importance.
.
Material Testing Lab
WIP possesses a full-fledged material testing lab which is monitored by its government
recognized R&D division. The Lab is equipped to perform various physical, mechanical
and electrical test specified in the IS specification.
Every day random samples drawn from panels produced in WIP’s plants are tested for
conformance to the relevant IS specifications.
The integrity and quality of WIP’s testing division can be gauged by the fact that
representative sampes drawn from material to be supplied to the Indian Railways,
Defence and other government organizations are tested on its own material testing lab
under the supervision of officials deputed by the respective inspection Agencies
67. 67
ACCOUNTS /FINANCE DEPARTMENT
THE WIP LTD IS A WIDELY HELD PUBLIC COMPANY. Its share is listed
in Cochin and Madras Stock Exchanges. On 31st
March 2003 Company has 13
Crores Paid Up Capital of which 8.5 Crores are Equity Shares and the remaining are
Preference Shares.
The Western India Plywood Ltd follows the Double Accounting System. Various
accounts are prepared by them to keep their transactions. The following are the main
types of accounts kept by Western India Plywoods Ltd.
Journal
Ledger
Sub ledger
To record receipt and payment they maintain 4 records. These include the following
Accounts.
Total debtor account
Total creditor accounts
Purchase day book
Sales day book
They also prepare a commission register. For charging depreciation against fixed
assets straight line method was used.
WIP publishes Annual Report every year, which includes the Profit and Loss Account,
Balance Sheet, Accounting Policies of the business etc.
SOURCE OF FINANCE
1. Shares
2. Reserves and Surplus
3. Loans Secures loans
4. Unsecured loans
ACCOUNTING PROCEDURE
WIP follow double accounting system and also maintain four types of journals. They
are;
Cash payment book (CPB)
Bank payment book (BPB)
68. 68
Cash receipt book (CRB)
Bank receipt book (BRB)
For these four types of journals, a sub ledger is prepared. This sub ledger are classified
into three;
Accounts Receivable Book (ARB)
Accounts Payable Book (APB)
Personal ledger (PL)
At the end of every month the sum total of the sub ledgers are transferred to the main
ledgers. Then there should have the equality in the amount of the sub ledger and main
ledger, i.e. total amount of sub ledger= Total Amount of Main Ledger
The next accounting procedure is preparing the trail balance. At the end of every
financial year, profit and loss account and Balance Sheet is prepares, from which
financial position of WIP is noticed
CAPITAL STRUCTURE
The capital structure Western India Plywood Ltd was made up of equity shares and
preference shares having value of Rs.100 each. They issue only redeemable
preference shares. They also issue bonus shares at the time of high profit. Their shares
are registered in the madras stock exchange.
Board’s decision. They transfer a certain percentage of profit to the following reserves
Export-profit reserve
Share premium reserve
General reserve
Loans:- the WIP Ltd has the following Loans for financing the long term requirement
of funds.
Secured loans
Term loans
Foreign loans overdraft
Long-term loans
Foreign Currency Transactions
69. 69
Foreign currency liabilities outstanding as at the balance sheet date are translated to
exchange rates prevailing on the date and the loss or gain arising out of the said
transactions relating to acquisition of fixed assets is adjusted to the cost of relative
assets and others are charged to the profit and loss account
Revenue Recognition
Revenue from sales has been recognized on raising of sales invoices on respective
parties and is inclusive of excise duty but exclusive of sales tax.
DIVIDENDS
Due to shortage of operating profit, directors are not recommending any dividend for the
accounting year ended 30-09-10
Retirement Benefits:
Contribution to Provident Fund is made monthly, at the rate prescribed by the
Employees’ Provident Fund Act and charged to the Profit and Loss account on accrual
basis
The company has an arrangement with LIC of India under the Employees Group
Gratuity cum Assurance scheme to administer its gratuity scheme and the annual
premium paid/payable is charged to the Profit & Loss Account. The accruing liability for
Gratuity to employees is ascertained on actuarial basis and provided for.
Leave encashment benefits payable to employees including the accrued thereon (taken
on estimate basis) are charged to the Profit & Loss Account.
Income Tax
Provision for income tax is made based on the assessable income as computed in
accordance with the provision of the Income Tax Act, 1961. Timing differences between
accounting income and taxable income capable of reversed in subsequent years are
recognized as deferred tax.
WIP publishes Annual Report every year, which includes the Profit and Loss Account,
Balance Sheet, Accounting Policies of the business etc.
70. 70
BALANCE SHEET AS AT 31.03.2011
Sch.
No.
As at
31.03.2011
(Rs. in thousands)
As at
31.03.2010
(Rs. in thousands)
I. SOURCES OF FUNDS
1.Shareholders’ Funds
a) Share Capital
b) Reserves & Surplus
2.Loan Funds
a) Secured Loans
b) Unsecured Loans
3.Deferred Tax Liability
TOTAL
II. APPLICATION OF FUNDS
1.Fixed Assets
a)Gross Block
b)Less: Depreciation
c)Net Block
d)Capital Work-in-Progress
2.Investments
3.Current Assets, Loan and
Advances
a)Inventories
b)Sundry Debtors
c)Cash and Bank Balance
d)Other Current Assets
e)Loan and Advances
Less Current Liabilities and
Provisions
a)Current Liabilities
b)Provisions
Net Current Assets
TOTAL
1
2
3
4
5
6
7
8
115,873
205,867
454,314
6,772
55,914
838,740
1,221,538
917,303
304,235
691
11,619
345,014
116,654
162,839
10,866
38,054
673,427
104,150
47,082
151,232
522,195
838,740
115,873
187,415
470,370
7,132
63,773
844,563
1,204,199
871,068
333,131
6,292
10,219
361,134
121,459
121,836
11,114
29,712
645,255
99,642
50,692
150,334
494,921
844,563
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Bankers (The WIP has mainly 7 banks)
SBT State Bank of TRAVANCORE
UBI (Urban Bank Of India)
IB (Indian Bank)
SYB (Syndicate Bank)
SBI (State Bank of India)
CB (Canara Bank)
STURCTURE OF THE DEPARTMENT
Company secretary
Chief Accounts Officer
Finance Manager
Cashier
Managing Director
73. 73
SWOT ANALYSIS
SWOT stands for Strength, Weakness, Opportunities and Threats.
Strengths and Weakness are the internal factors of the company where as
Opportunities and Threats are external factors. SWOT Analysis is the tool for auditing
an organization and its environment. It is the first stage as planning and helps marketers
to focus on key issues have been identified, they feed into marketing objectives. It can
be used in conjunction with other tools as audit and analysis.
STRENGTH
The company has been maintaining a high quality for its products and as its products
are well accepted in the market by quality conscious customers, it does not anticipate
any marketing problem. They are considered to be the “The Leaders in Quality Since
1945”.
The company has a well established R&D unit, one of the best kinds in the wood based
industry.
The company is duly equipped to develop new products to meet the requirements of the
market.
The products of WIP are certified by ISO.
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WEAKNESS
There is an acute shortage of good raw materials which has forced the company
to import a substantial portion of its main raw material viz. timber, which has also seen a
considerable increase in price.
Lack of good distribution network as compared to the competitors.
Promotion of competitors is better to that of WIP. The Company concentrates only on
Industrial Market.
The price of WIP’s products is high as compared to its competitors.
OPPORTUNITIES
The company is a leading supplier to Railways, Defense, Automobile, Electrical,
Transport, Civil Aviation and other industries.
Several products have been developed for the specific requirements of the Automobile,
Transport and communication sectors such as Densified wood etc. and these products
which have technological advantages over competitive products.
The Company diversified from the production of chest and commercial plywood to
manufacture Decorative Plywood, Block Boards, Shuttering Plywood and Aircraft
plywood.
75. 75
The products of the Company are being exported to Germany, France, U.S.A, Sweden,
West Asia and South Asian countries.
THREATS
The high power tariff and increasing cost of furnace oil and other petroleum products
and chemicals.
There are many medium scale and small scale plywood industries. They fix low price for
their products.
In some product ranges, imported items are available at lower cost than is currently
produced in India.
In general, the working of the company has been adversely affected by the effects of
Globalization.
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FINDINGS
Because of the increasing demand, now the company has changed their distribution system in
order to reach more parts of the state.
Due to the high standard of quality maintained by the company, its production costs are
relatively high so that company facing a serious problem and wants to reduce the price.
The company’s various operations on raw material performed in sequence and the machines
are placed along the product flow line. Because of this, the company’s products get completed
in lesser time and also have a smooth and continuous work flow.
The company gets 25% of the profit from the exporting.
Company concentrate all over the market.
Still the company is not computerized fully.
The company maintaining 0 % wastage.
Promotional expense is very less.
WIP focus on quality
SUGGESTIONS
It is desirable to launch an advertising campaign to attract more customers
It is advisable to maintain and efficient market intelligence system and advice mgt of the
changing needs of the market.
The company may introduce more measures such as fencing of machineries, which will protect
the workers from accidents.
The company may prepare budgets for each activity which will provide it a better control and
coordination mechanism. This will aid in reduction of production costs.
The company can save time and cost through the computerization.
The company have to follow more safety measures because there is a risk of fire in the factory
layout.
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CONCLUSION
Western India plywood ltd., the second largest wood processing industry in South East Asia, as a
bright future in this field. During the running period since 1945, the co. achieved various milestones. The
high-end production technology of WIP is well acknowledged among the wood processing industries in
India.
The WIP Ltd., achieved 100% utilization of raw materials due to its integrated production system.
Therefore, it would be apt to call WIP Ltd., ‘ a company with a conscience ’. WIP Ltd., stands for
superior product performance and provides value for money to its customers. It is backed by WIP’s
commitment to harness the latest technology in wood processing industry and continuously upgrade its
processes and machinery. Due to the high quality maintained, the company has found aready market both
India and abroad. The company does not aim at competing with the local manufactures but wants a main
player in the plywood export.
Now the company is producing more quantity is hardboards than plywood, because of the development of
technology. Presently the company is operating in loss- the major cause being globalization. Another
reason is the pricing policy of the company. The price level of the products is higher as compare that of
other companies manufacturing similar products. The company should try to create brand awareness in
the local market by advertising in medias and conducting exclusive exhibitions etc.
BIBLIOGRAPHY
1. www.wipltd.com
2. K. Aswathappa, production & operation mgt, 2007
3. K Aswathappa, human resources and personnel management, 2007
4. Khan and Jain, financial management
5. Quality Management hand book- K K Anand
