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PROJECT REPORT
ON
“WORKING CAPITAL MANAGEMENT”
IN
‘BRITANNIA INDUSTRY LIMITED’
FOR
FROM
Mayank Mittal
DECLERATION
Mayank Mittal
PREFACE
In any economy, the financial sector plays a major role in the mobilization
and allocation of savings. In changing economic environment,
manufacturing industries have to become more competitive, they have to
keep their cost in check an efficient use of working capital would release the
funds locked in the current assets.
Table of CONTENTS
Introduction About Britannia industries
Company overview
Company profile
Board of directors
History of Biscuits
Company Products
Achievement of company
The story of one of India’s favorite brands reads almost like a fairy tale.
Once upon a time, in 1892 to be precise, a biscuit company was started in a
nondescript house in Calcutta (now Kolkata) with an initial investment of
Rs. 295. The company we all know as Britannia today.
The beginnings might have been humble-the dreams were anything but.
By 1910, with the advent of electricity, Britannia mechanized its operations,
and in 1921, it became the first company east of the Suez Canal to use
imported gas ovens. Britannia’s business was flourishing. But, more
importantly, Britannia was acquiring a reputation for quality and value. As a
result, during the tragic World War II, the Government reposed its trust in
Britannia by contracting it to supply large quantities of “service biscuits” to
the armed forces.
As time moved on, the biscuit market continued to grow and Britannia
grew along with it. In 1975, the Britannia Biscuit Company took over the
distribution of biscuits from Parry’s who till now distributed Britannia
biscuits in India. In the subsequent public issue of 1978, Indian
shareholding crossed 60%, firmly establishing the Indian ness of the firm.
The following year, Britannia Biscuit Company was re-christened Britannia
Industries Limited (BIL). Four years later in 1983, it crossed the
Rs.100crores revenue mark.
On the operations front, the company was making equally dynamic
strides. In 1992, it celebrated its Platinum Jubilee. In 1997, the company
unveiled its new corporate identity – “Eat Healthy, Think Better” – and
made its first foray into the dairy products market. In 1999, the
“Britannia Khao, World Cup Jao” promotion further fortified the affinity
consumers had with ‘Brand Britannia’.
Britannia strode into the 21st Century as one of India’s biggest brands and
the pre-eminent food brand of the country. It was equally recognized for its
innovative approach to products and marketing: the Lagaan Match was
voted India’s most successful promotional activity of the year 2001 while
the delicious Britannia 50-50 Maska-Chaska became India’s most successful
product launch. In 2002, Britannia’s New Business Division formed a joint
venture with Fonterra, the world’s second largest Dairy Company, and
Britannia New Zealand Foods Pvt. Ltd. Was born. In recognition of its
vision and accelerating graph, Forbes Global rated Britannia ‘One amongst
the Top 200 Small Companies of the World’, and “The Economic Times”
pegged Britannia India’s 2nd Most Trusted Brand.
Today, more than a century after those tentative first steps, Britannia’s
fairy tale is not only going strong but blazing new standards, and that
miniscule initial investment has grown by leaps and bounds to crores of
rupees in wealth for Britannia’s shareholders. The company’s offerings are
spread across the spectrum with products ranging from the healthy and
economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese.
Having succeeded in garnering the trust of almost one-third of India’s one
billion populations and a strong management at the helm means Britannia
will continue to dream big on its path of innovation and quality. And
millions of consumers will favor the results, happily ever after.
COMPANY PROFILE
Registered office of Britannia Industries Limited is situated in West Bengal.
This company is registered under Companies Act, 1956.
The main aim of the Company is to make available good and improved
quality biscuits to each and every part of the country.
The Company was established at the Pantnagar branch on 1st April 2005
mainly for production with a production coverage area of approximately 20
acres.
The Company’s head and registered office and works place are located at
the below mentioned addresses:
Britannia –the ‘biscuit’ leader with a history-has withstood the tests of time.
Part of the reason for its success has been its ability to resonate with the
changes in consumer needs-needs that have varied significantly across its
100+ year epoch. With consumer democracy reaching new levels, the one
common thread to emerge in recent times has been the shift in lifestyles and
a corresponding awareness of health. People are increasingly becoming
conscious of dietary care and its correlation to wellness and matching the
new pace to their lives with improved nutritional and dietary habits. This
new awareness has seen consumers seeking foods that complement their
lifestyles while offering convenience, variety and economy, over and above
health and nutrition.
Britannia saw the writing on the wall. It’s “Swasth Khao Tan Man Jagao”
(Eat Healthy, Think Better) re-position directly addressed this new trend by
promising the new generation a healthy and nutritious alternative – that was
also delightful and tasty.
Thus, the new logo was born, encapsulating the core essence of Britannia –
healthy, nutritious, and optimistic – and combining it with a delightful
product range to offer variety and choice to consumers.
HISTORY OF BISCUITS
As people started to explore the globe, biscuits became the ideal traveling
food since they stayed fresh for long periods. The seafaring age, thus,
witnessed the boom of biscuits when these were sealed in airtight containers
to last for months at a time. Hard track biscuits (earliest version of the
biscotti and present-day crackers) were part of the staple diet of English and
American sailors for many centuries. In fact, the countries which led this
seafaring charge, such as those in Western Europe, are the ones where
biscuits are most popular even today. Biscotti is said to have been a favorite
of Christopher Columbus who discovered America!
Making good biscuits are quite an art, and history bears testimony to that.
During the 17th and 18th Centuries in Europe, baking was a carefully
controlled profession, managed through a series of ‘guilds’ or professional
associations. To become a baker, one had to complete years of
apprenticeship – working through the ranks of apprentice, journeyman, and
finally master baker. Not only this, the amount and quality of biscuits baked
were also carefully monitored.
The English, Scotch and Dutch immigrants originally brought the first
cookies to the United States and they were called teacakes. They were often
flavored with nothing more than the finest butter, sometimes with the
addition of a few drops of rose water. Cookies in America were also called
by such names as “jumbles”, “plunkets” and “cry babies”.
As technology improved during the Industrial Revolution in the 19th
century, the price of sugar and flour dropped. Chemical leavening agents,
such as baking soda, became available and a profusion of cookie recipes
occurred. This led to the development of manufactured cookies.
Interestingly, as time has passed and despite more varieties becoming
available, the essential ingredients of biscuits haven’t changed – like ‘soft’
wheat flour (which contains less protein than the flour used to bake bread)
sugar, and fats, such as butter and oil. Today, though they are known by
different names the world over, people agree on one thing – nothing beats
the biscuit!
Our products
LITTLE HEARTS
Britannia GOOD DAY
TIGER
TREAT
MARIE GOLD
NUTRICHOICE
MILK BIKIS
BREAD
CAKES
RUSKS
Achievement of the company
THE Economic Times and AC Nielsen have announced the most trusted brands
rated by consumers all over India and across categories. Britannia was in the India
Top 10 list, ranked 9 across all categories and 2 in the food category. Last year,
Britannia rank was 7 and 2 respectively.
INTRODUCTION
ABOUT
THE
PANTNAGAR UNIT
INTRODUCTION
Britannia industries limited was established at Pantnagar on 1 stApril 2005
in the area of approximately 20 acres mainly for the purpose of production
of biscuits as this area is free from almost all types of taxes.
In Britannia Industries Limited there are many types of departments
which are inter connected to each other and work together for the welfare of
the Company as the whole. There is a well built communication system
inside the Company which helps in doing the work on time and with full
efficiency and effectiveness.
The departments of the Company includes Quality assurance, Stores,
Production, Purchase, Maintenance, Engineering, Packaging and dispatch,
Personnel and training, Finance, legal and administrative security.
New concept like 5S is also being implemented in Britannia Industries
Limited. The Company has got ISO 14001 certificate and it is ISO 22000
certified.
There are four plants in operation in the Company at this branch. First plant
is for Marie Gold which has a flexi line for Good day also. Second plant is
for Good Day, Third one is for 50:50 variants, pepper chakkar and Maska
Chaska. Fourth and last plant is for Bourbon which has a flexi line for
Orange cream also.
HEADS OF DEPARTMENTS OF THE
COMPANY
2. Plant II
3. Plant III
50-50
4. Plant IV
Chocolate Bourbon
Orange treat
SEIRI
SEIKETSO SEISO
standards.
ensures that our products are healthy and safe for consumption.
consistent with product and pack specifications which are free from
contamination.
Our supply chain practices enable delivery of fresh products to our
customers.
adequately.
business Outcomes.
Working capital refers to short term funds required to meet the day to day
operating expenses of the firm.
According to RAMAMOORTHY,
CONCEPT BASED
Net working capital (NWC) is the difference B\W Current assets ¤t
liabilities. It is that portion of firm’s current assets which is financed with
long as well as short term funds.
Current Assets:-
Cash and Bank deposits
Inventory
Debtors and Receivables
Prepaid Expenses
Marketable Securities
Current Liabilities:-
Bank Overdraft
Creditors and Payables
Notes Payable
Accrued Expenses etc.
TIME BASED
3 Production policy
5 Seasonal variations
8 Credit policy
9 Business Cycle
13 Other Factors
APPROACHES TO WORKING CAPITAL
HEDGING OR MATCHING
CONSERVATIVE
AGGRESSIVE
Hedging: This requires that financing of each asset would be offset with a
financing instrument of approximately the same maturity. Short term or
seasonal variations in current assets would be financed with short term debt.
The fixed assets and the permanent component of current assets would be
financed with long term debt or equity. And the firm can adopt a financial
plan which matches the expected life of source of fund s raised to finance
assets.
Cash not only include hard cash but also include which can be easily
converted into cash with in no time.
a) Cash Budget.
b) Inflow or Outflow of cash.
c) Ratio Analysis.
2. Management of receivable: -
3. Management of Inventory: -
Inventories mean the stock of the product and the components of the
product that is Raw Material, W-I-P, Finish good, Spares. Inventories
hold the prime position among the current assets in India. In India, about
60% of the current assets are representing by inventories. Thus large part
of working capital is invested in inventories. The management of
inventories is therefore necessary to avoid heavy losses due to leakage,
theft and wastage because neglecting the management of inventories may
jeopardize the long run profitability of the concern and the concern may
fall ultimately. Inventory management will minimize these costs.
Tool for Inventories control:-
Ratio Analysis:
Ratio is one of the methods of analyzing financial statement. Ratio analysis
measures the Profitability, Efficiency and Financial soundness of the
business
According to Myers, “Ratio analysis is a “study of relationship among the
various financial factors in a business”.
The objective for doing my summer training is to make myself capable for
moving forward in corporate world, to gain knowledge & experience &know
how to work in the organization environment. It will help me to gain more &
more about corporate sector, which was very essential for me to do. There-
fore I joined BIL Pantnagar to improve my capabilities.
Main objective
To analyze how ‘working capital management’ method is done in Britannia
industries limited.
Sub objective
Primary DATA:
Primary data are those which are collected a fresh and for the first time and
thus happen to be original in character. There are numbers of method of
collecting primary data.
Calculation
Observation
Secondary DATA:
Secondary data means data that are already available i.e. they refer to the
data which have already been collected and analyze by someone else.
Books
Reports
Magazine
Internet
OBJECTIVES OF RESEARCH
The main aim of research is to find out the truth which is hidden and
procedure.
The time period for the project is very less for understanding the wide
organization.
The ratio of the one company cannot always be compared with the
performance of the other firm.
The scope off study is very wide .A large sample would have
provided more confidence in the findings but due to cost and time
constraint the sample size was kept small.
Most of the business units in our country do not have confidence that
the information shared by them with the people will not be misused.
So this makes the employees reluctant to share information with them.
Reluctance is more if information pertains to financial position and
business operations.
FINDINGS
contingency.
Conclusion
And
Bibliography
Recommendations
Maintaining good relations with suppliers to get maximum raw
future as well.
Rudrapur Branch.
regional players striking so hard at BILs market share the company has not
made any compromise with quality, systems and practices in spite of feeling
the pinch in its profitability not only due to competition but also because
unpredictability in the availability and price of one of its major raw material
Maida.
The company is doing well in terms of its marketing approach and the
www.google.com
www.britannia.com