Professional Documents
Culture Documents
Reliance Aerospace has leading worldwide market shares in all of its major product lines and
serves virtually all of the world’s airlines, aircraft manufacturers and leasing companies
through its direct global sales and customer support organizations.
With its Global Headquarters in Hyderabad, India, Reliance Aerospace caters to all the major
Aerospace companies and Airlines worldwide. All the products are manufactured from its
plants located in Hyderabad and Pune respectively..
2. Products:
Reliance Aerospace offers turnkey solutions to its customers and acts as a single point of
contact for all their Integration needs. It is a one-stop shop for Airline companies
considering new products, reconfiguration and refurbishment. Reliance’s products are
broadly categorized into 7 Product families which accommodate all areas in Interior design
for Boeing 737, 757, 777 and Airbus A-330, 350 and 300-600 type aircrafts.
Pricing Schema – Separate pricing schema to be prepared for each vendor. Pricing conditions
may vary form time to time as per RAL polices and procedures and regulations.
Duties (BED+CVD+SAD) to be paid on the assessable value (calculated based on Basic Price +
Freight + Insurance * 1% for all import purchases. In some cases additional 2% will be added on
the above value). But in the both the cases 1% for 1% + 2% should not go into the material cost.
This is only for statistical purpose only for calculating the duties to be paid.
Duties are to be paid to Customs authorities and Basic price + freight (if any) will be paid to the
vendor.
Material Subcontracting: Here the buyer the seller with raw material and requires
the seller to perform all necessary manufacturing steps to produce the finished
product.
6.1.4 Stock Transport Order:
In this type of procurement, goods and services are procured and delivered from one
plant to another which is part of the same company. It is important to note that
though the plants are under the same company, they do not share material storage
locations. The plant which requires the materials places an internal order with
another plant that can supply the materials. Thus this stock transfer process involves
not just inventory management but also purchasing in the receiving plant.
7. Purchase Cycle:
Types of MRP:
The current business process has specific hierarchy in place to authorize Purchase
Requisitions, Purchase Orders and Contracts. It ensures a transparent procedure as these
activities deal with commercial and legal implications.
All the Purchase requisitions raised by different user departments will be reviewed by the
functional lead and assigns the same to the concerned higher authorities for release procedure.
Note: While creating or modifying the Purchase requisitions by user department persons, the
person must specify his name and designation. This option is used for tracking purpose and to
find out the status of the Purchase requisitions. The “functional lead” maintains the status of all
the records of Purchase requisitions.
The functional head or in charge will review the purchase requirement, decides the procurement
type, (example: New enquiry, repeat order or against an existing contract) and forwards it to the
purchasing department.
On receipt of Purchase Requisitions from various user departments, the concerned functional
head will initiate the purchase cycle. (mentioned in document)
9.6 Hardware:
Hardware material usually refers to consumable materials such as screws, nuts, o-rings, rivets
etc. used in the assembly or the manufacturing process
10. Vendor Types:
10.2 Sub-Contractors:
A subcontractor is hired by the company to perform a specific task as part of the overall task.
It is in the best interest of the company to use the services of sub-contracting vendors
to reduce costs or to mitigate risks. In this type of Procurement, the buyer provides
the seller with raw material or semi-finished products and to hires their services for
certain manufacturing steps or operations.
Machinery Services:
Since the company’s core competency is in manufacturing, the production floor is mainly
occupied by different types of machinery such as CNC machines, Grinding, milling and tooling
equipment. These machines require maintenance and service at regular intervals for that
purpose, the services of such specialists are purchased.
12. Inventory Management Process Flow:
Inventory means goods and materials held available in stock by a business. It refers to the
stock of resources that possess economic value, held by an organization at any point of
time. These resource stocks can be machines, capital goods or materials at various stages.
Inventory management is primarily about specifying the size and placement of stocked goods.
Inventory management is required at different locations within a facility or within multiple locations
of a supply network to protect the regular and planned course of production against the random
disturbance of running out of materials or goods.
Inventory management starts at goods receipt and ends at goods issue to customer.
The material is received at the docking station along with the bill of lading, the
corresponding Purchase Order and an Invoice from the seller. All these details are
entered into an inward entry register against the material received.
The materials are sent to quality check department where the material is checked
thoroughly ensuring quality and specification criteria as mentioned in purchasing order.
If the quality inspection is satisfactory the material is issued to the stores and if the
quality requirements of the material are not fulfilled, the goods are either sent to a
Material Review board for further inspection and may be accepted with a Non-
Conformance tag or will be returned to the vendor. Please note that if the material is
returned to the vendor, the Purchase Order Line item of the material in question
remains open until the vendor re-sends material that is acceptable as per the quality
standards.
Scrap: In case the material received is found to be damaged in shipping and not due to
the vendor, the quality, purchase and material departments together assign the material
to be scrapped.
Goods movements in stores: User departments raise indents (indent means material
issue requisition) when material is required in the production or maintenance process.
In response the stores department issues goods as required. In case the specified
material is not available in stock, then the user department raises a purchase requisition.
Reservation: In some cases the user departments create indent for material needed in
near future. This process is called reservation. Here the material is reserved as special
stock and can be issued only to the specific department creating the reservation.
Goods are moved from one storage location to another based on an indent raised by a
particular stores department
Based on sales orders, stores dispatch finished products to customer. In case of damage
caused during transportation, the defective goods are returned by the customer. Quality
department assesses the damaged material and decides if it is repairable or not. In case
the material is not repairable, it is scrapped.
B. Outward register: In this outgoing materials form the stores are entered.
D. Consumables register: Like diesel oil, lubricants, paints, cotton, waste etc.
F. Loan register: Non consumable material is issued for a temporary period to user
departments.
G. Store ledger: In this material receive, issue, remain balance are accounted.
13. Print Output:
13.3 Purchase Order: Purchase orders are commercial and legal agreements between seller
and taken as a printout in a specific manner and to be filed by the buyer. A purchase order has to be
printed/Sent to a vendor in a specified format provided.
13.4 Purchase Order Amendment: After amendment of Purchase order, the same to be
taken printout and filed by buyer for record purpose. All the modifications on the purchase order to
be documented and to be informed to the vendor immediately.
13.5 Contract: Contracts are commercial agreements between the buyer and seller for a
stipulated time period with certain pricing conditions and delivery dates for the materials in
question. Contracts will be taken printout in a specific manner and to be filed by the buyer.
13.6 Material Receipt Tags: After goods receipt, the receiving personnel create a
material tag detailing the information of the material such as its description, quantity,
material number. These tags are useful in easy identification of the material.
14. Reports:
For the regular business functioning of the various user departments (purchase dept,
operations, finance, S&D), the company relies on reports to act on. These reports contain
the actual information or data existing in the system based on which different departments
schedule or plan their operations.
Which of the best vendors received a particularly good or bad score for the main criterion
"Price"?
Which vendors received a good overall score, but a below-average score for the main
criterion "Quality"?
Which vendors received a poor overall score but a very good score when you only consider
one particular material?
Which service providers perform services for you on time and with high quality?