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SCI SPECTRUM CONVERTING

INDUSTRY
PO Box 62718, Dubai, United Arab Emirates

SS
Tel: 06-747-4949 Fax: 06-747-4944
Ajman Free Zone, Ajman.
Email: sushilsharma09@gmail.com
. spectrumsas@gmail.com

INTRODUCTION
This company was started by Mr. Sushil Sharma & Mrs. Alka Sharma
in 1998 in Free Zone Ajman for manufacturing Textile Garments &
home furnishing items.

This company introduces it self as one of the leading manufacturer


exporters of the various types of Fashion garments for ladies &
children, uniforms for leading industrial groups, home furnishing items,
Flag printing, various types of Sign boards in our state of art units in
the Free Zone Ajman in UAE.It deals with leading international clients
like K-Mart, Sears, Zara, Carrefour etc.

In GCC this group is dealing with Carrefour, Giant , Kempesky Group,


International Choueifat School Group, American School , Royal Dubai
School, Franco Phone School, Australian International School, Gulf Medical
College, Zippka Group, Arabian Profile Co, Al Rais Cargo group. They are
manufacturing quality Uniforms for many institutions, which include
Shirts, Trousers, skirts, Pinafores, T –Shirts, Graduation Gowns, and
Sports Sets.

They also specialize in manufacturing Special Costumes for various


cultural functions. They have three manufacturing units & each is
equipped with state of art machineries &Technology.

In this company I shall be doing my project for studying Inventory


management for optimum control and utilization of their inventories. I
have been requested by the management to provide suggestions for
minimizing the financial problems faced by the company at various
levels. As per its quality and usage, the inventories will be classified
through ABC and EOQ analysis.

Statement about problem

Studying and analyzing all the factors of the inventories along with optimum
inventory level of this group. This company inspite of its sincere efforts is
not getting its best possible results for the last 4 years and is facing more
financial problems because of the recession in international market.

Through ABC analysis and EOQ analysis some of the problems can be
rectified.

Importance and Scope

Inventories are stock of the product a company is manufacturing for


sale and components that make up a product .The various forms in
which inventories exist in a manufacturing company are raw materials,
work in progress and finished goods.
• Raw material – These are those units which have been purchased
and stored for future productions.
• Work in progress – These are semi manufactured products. They
represent products that need more work before they become
finished products for sale.
• Finished products – These are those completely manufactured
products which are ready for sale.
• Supplies or stores and spares – These materials do not enter
production but are necessary for production process like soap,
fuel, light bulbs.

IMPORTANCE OF INVENTORY

• Inventories serve as cushions to absorb stocks.


• Inventory for any organization is necessary evil.
• Inventories are result of many interrelated decisions and
policies of an organization.
• Inventory provides production economy.

Too much inventory leads to undue carrying charges like taxes,


insurance, depreciation etc. Too little inventory involves frequent
ordering, loss of quantity discounts, higher transportation costs etc.
To maintain the balance of too much and too little inventory is critical
task and can be done by implementing inventory control.

Inventory management is a system of ordering based on the


maintenance of stock in a store using a re order rule based on stock
levels.

Some of the importance of this project is as follows:

• The efficiency with which the firm is utilizing its assets in


generating sales revenue.
• Track and manage any type of the inventory.
• Uncover the opportunity gap between inventory levels, sales and
margins.
• Create parameters for best and poor performers in various
categories.
• Provide accurate insight to inventory.
The lack of accuracy can negatively impact the buying decisions the
company will make which means that materials can be over- or under-
bought. The company may also not have confidence in its systems and
employees - because the inventory is taken rarely, the numbers may be
inaccurate and shrinkage is completely out of control.

Scope:

The company and its associates who are being studied would be within
United Arab Emirates.
Objective:

• Studying inventory management for this company.


• To provide suggestions for solving financial problems faced by the
company.
• To analyze the operating cycle of the firm.
• To help the firm to classify its inventory by A B C analysis.
• To identify the lead time of the inventory order.
• To identify the optimum level of inventory to be maintained through
EOQ model.

Methodology:

• Data collection:
• Primary Data: will be from the meetings and interviews with
Management, staff and workers. We will collect data’s of various
departments like production, purchase, costing, Accounts, stores, etc.

• Secondary Data: Although the data are collected from the company’s
accounts, reference to books and internet websites makes the project
much more applicable.

• Data Analysis: After the data is collected it would be analyzed with


the help of Analytical tools like Bar Graphs, Pie Charts, Histograms,
etc. for the last 5 years.

• Period of Study and Cost : The total time period for completion of
my project would be approximately 45 days and approximate cost for
completion of this project would be around 750/Dh that includes
transportation and other petty expenses.
Conclusion and Recommendations

With the help of study and analysis of inventory management one can
suggest many concrete suggestions for improving the growth of the
company. By implementing the suggestions of this project report, this
company will become a profit making company within a year. Once the
project is complete the company will be able to handle and control its
inventories in the optimum requirement.

Reference Materials

Books:
• Financial Management – by I M Pandey.

Journal:
• UAE Digest Magazine
• Gulf Business
• Gulf News
• Khaleez times
• Business times

Websites
• www.dubaifreezone.com
• www.ajmanfreezone.com

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