Summer Training Report

On

MATERIAL COST CONTROL

For the partial fulfillment of the award of
Bachelor of Business Administration

(2008-2011)

Submitted To Submitted by

JIWAJI UNIVERSITY GWALIOR AKASH GUPTA

BBA-V Sem.

PRESTIGE INSTITUTE OF MANAGEMENT, GWALIOR

Airport Road, Near Deen Dayal Nagar, Gwalior-474020

Email: info@prestigegwl.org; Website: www.prestigegwl.org
 DECLARATION
I AKASH GUPTA, student of BBA V Semester of Prestige Institute of
Management, Gwalior, hereby declare that the project is my original piece of work
and not the copy of any such work undertaken by someone else, all the
information , facts and figures presented in the report are first hand in nature. They
are actually based on my intense efforts conducted in CADBURY INDIA LTD. I
have completed this project under the guidance of Prof. NAVITA NATHANI
( Faculty PIMG)

Date: AKASH GUPTA

BBA –Vth SEM

 CERTIFICATE

This is to certify that Mr.AKASH GUPTA Student of BBA Vth Semester

programme has completed her summer training of 4 weeks and prepared this report
of “MATERIAL COST CONTROL” under my guidance.

Date: Prof. NAVITA NATHANI

(Faculty Guide)
 ACKNOWLEDGEMENT

The present work is dedicated to the persons who not only taught me, but continue
inspire me in knowing the clandestine facts of workmanship. I bow in honor before
these great teachers. The accomplishment of the present study became possible by
the invaluable assistance and guidance of my professional guides to whom I may
gratefully indebted. Firstly I would like to express my sincere gratitude to my
faculty guide Prof. NAVITA NATHANI without whose invaluable guidance,
moral support and encouragement my work would have ever assumed the present
shape, research. I was indebted to my parents and friends for their moral support
and possible efforts they made for me.

Date: AKASH GUPTA

BBA –V SEM
 INDEX page no

• History of the Organization & Objective

• Organizational Structure
• Financial Performance
• Material Cost Control
• Production & Operations
• Marketing
• Strength & Weakness of the Organization.
• Suggestion
• Special Point
• Names of the CEO/MD/Department Head

Chapter -1

• Introduction

Chapter –II

• Objective of The Study

Chapter –III

• Result & Discussion

Chapter – IV

• Suggestion

Chapter –V

• Conclusion
HISTORY OF THE ORGANISATION AND OBJECTIVE

CADBURY INDIA

Cadbury began its operations in 1948 by importing chocolates and then re-packing
them before distribution in the Indian market. After 59 years of existence, it today
has five company-owned manufacturing facilities at Thane, Induri (Pune) and
Malanpur (Gwalior) , Bangalore and Baddi (Himachal Pradesh) and 4 sales offices
(New Delhi, Mumbai, Kolkota and Chennai). The corporate office is in Mumbai.
Our core purpose “Working together to create brands people love” captures the
spirit of what we are trying to achieve as a business. We collaborate and work as
teams to convert products into brands. Simply put, we spread happiness! Currently
Cadbury India operates in three sectors viz. Chocolate Confectionery, milk food
Drinks and in the Candy category.
In the Chocolate Confectionery business, Cadbury has maintained its undisputed
leadership over the years. Some of the key brands are Cadbury Dairy Milk, 5 Star,
Perk, Éclairs and Celebrations. Cadbury enjoys a value market share of over 70%
the highest Cadbury brand share in the world! Our flagship brand Cadbury Dairy
Milk is considered the “gold standard” for chocolates in India. The pure taste of
CDM defines the chocolate taste for the Indian consumer.
In the Milk food drinks segment our main product is Bourn vita – the leading
Malted Food Drink (MFD) in the country. Similarly in the medicated candy
category Halls is the undisputed leader. We recently entered the gums category with
the launch of our worldwide dominant bubble gum brand Bubbaloo. Bubbaloo is
sold in 25 countries worldwide. The Cadbury India Brand Strategy has received
consistent support through simple but imaginative extensions to product categories
and distribution. A good example of this is the development of Bytes. Crispy wafers
filled with coca cream in the form of a bagged snack, Bytes is positioned as “The
new concept of sweet snacking”. It delivers the taste of chocolate in the form of a
light snack, and thus heralds the entry of Cadbury India into the growing bagged
Snack Market, which has been dominated until now by Salted Bagged Snack
Brands. Bytes were first launched in South India in 2003.
MALANPUR FACTORY
In 1989 the company stated manufacturing operations from its third and newest
factory at Malanpur near Gwalior in M.P.

Using the most modern state of the art technology, the unit today manufactures
range of liquid milk chocolate and a variety of enrobed chocolate products.
Factory in 8 phases
1988-89 - Éclairs & Gems
1994-95 - 5 Star
1997 - Perk
2001 - Chocolate expansion
2005 - Fruity Gems
2006 - Ultra Perk
2008 - Short
2009 - Éclair Sticks
LOCATION : Plot No. 25, Malanpur Industrial area, Malanpur
distt. – Bhind.
Telephone No. : 07539-83803, 83804
Parent Company : Cadbury Schweppes International UK
Total Area 24 Acres – Constructed 8.5 Acre

HISTORY OF ORGANISATION
Fifty years ago, the real taste of chocolate as we know it today, landed on Indian
shores. An event that carried forward the entrepreneurship and vision born as far
back as 1824, when John Cadbury set up shop in Birmingham (UK) to sell among
other things – his own cocoa concoction. From these modest beginnings emerged
Cadbury Schweppes – that is today the leading manufacturer of confectionery and
beverages in the United Kingdom. A company that has its presence in over 200
countries worldwide and has made the name ‘Cadbury’ synonymous with cocoa
products in countries across the planet.

This is the brand that came to India in 1947 to a nation that was in its infancy, a
market that was ready for the world and a people that were open to new ideas, new
products.

Within a year of being set up as a trading concern, Cadbury fry India was
incorporated as a Private Limited company, set up for processing imported
chocolates and Bourn vita. The same year saw the launch of Cadbury’s Milk
chocolate for millions of Indians.

Through 50 years of investment in capital and marketing, the scale and scope of our
operations has expanded to cover a range of brands in the chocolate, sugar
confectionery and malted food drinks segments. We have a majority share in the
Indian chocolate market and a significant presence in sugar confectionery and food
drinks.
Today Cadbury India Ltd, a subsidiary of Cadbury Schweppes employs over 200
people across the country. And operates in one of the fastest growing chocolate
markets for Cadbury Schweppes group across the globe.
ORGANISATION STRUCTURE
Chairman

C Y Pal
Chairman - Non Executive

Managing Director

Anand Kripalu
Managing Director

Non-Executive Directors

Harsh Mariwala
Radhakrishnan B. Menon
Suresh Talwar

Executive Directors

Atul Bhatia Rajesh Garg

Executive Director - Executive Director -
Science & Technology Finance & Commercial

Jaiboy Phillips Sanjay Purohit

Executive Director - Supply Executive Director -
Chain Marketing
Sunil Sethi
V Chandramouli
Executive Director -
Executive Director -
Sales & Customer
HR & Strategy
Development

Senior Management

Ashish Pisharodi Rajesh Ramanathan

Vice President - Modern Vice President - People &
Trade Talent

Shivanand Sanadi Dr. Shantanu Samant

Vice President - Legal Vice President -
Affairs Science & Technology

Vivek Sarbhai Dharmesh Joshi

Vice President - Logistics & Vice President -
Customer Operations Manufacturing Development

Sherezad Irani Sanjay Kurup

VP - Procurement VP - Manufacturing (Baddi)

Monaz Noble
Company Secretary
FINANCIAL PERFORMANCE

Finance holds the key to all human activity. Finance department of malanpur

factory is also working in the same direction and with the same objective but it

has some limitation because most of the importance finance related matter are

directly dealt and finalized by the central finance department in the Mumbai head

office.

Factory finance department always endeavors of maximizing the profit of high

company through two possible ways:

1. Reduction in cost

2. Increase in Sales

FINANCIAL FUNCTIONS

1. Preparing variance report

a) Material user variance report

b) Packaging material user variance report

2. Production report

3. Excise related matter

4. Export related matter

5. Payment to small engineering items and other goods.

MATERIAL COST CONTRL
MATERIAL COST CONTROL

Material cost control is the management of cost of material it consists of the

following .
1. Capital costs
2. Storage costs
3. Risk of price decline
4. Risk of obsolescence

MATERIAL

Material is very important factor for production. it includes physical commodities

used to manufacture the final end product. It is the starting point from which the
first operation starts. Material refers to all of commodities in the process of
manufactures. Proper control of material is necessary from the time orders of
purchase material are placed with supplies. Until the have been consumed.

COST

It is the amount of resources given up in exchange for some goods or services. The
cost is that which is given or a sacrifice to obtain something cost is also different
from value as cost is measured in terms of money whereas values is measured in
terms of usefulness or utility of an article.
We can define as: the amount of expenditure (actual or notional) incurred on or
attributable to a given thing or to ascertain the cost of a given thing.
Methods of controlling the size of material:
There arc two method of controlling as follows:
1) Standardization.
2) Simplification.
Standardization and simplification are the tools of material control to optimize on
the number of items and reduce the size of material, carried in the stores.
Standard institutions:
Standardization and simplification are the continuous process
for controlling the size of materials, so there are many institutions regarding the
help of this, these arcs as follows
. Indian Standard Institute.
. International Organization for Standardization.
. Other Specialilised Institutions.

Types of stores department:

I) centralized stores
2) Decentralized stores
3) Central stores with sub- stores.
1) Centralized stores :In case of such a store, material are received by and issued
from one stores department materials kept at one central store.
2) Decentralized stores:
Under this type of stores, independent stores are situated in various departments.
Such types or stores setup to meet the requirements of materials of each production
department are not very popular because of the heavy expenditure involved.

3) Central stores with sub-stores:

Such stores should be situated near production departments. For each item of
material, a quantity is determined and this should be kept in stock in sub-store at the
beginning of any period .In the end of a period the storekeeper of each sub-store
will requisition from the central stores.

Fixation of KO.Q. And various level:

A) E.O.Q.:
 The decision about how much order has great significance in inventory
management .the quantity should be order neither small nor big because cost of
buying and carrying material are very high.
Economic order quantity is the size of the lot to be purchased which is
economically ) viable .this is the quantity of material which can be purchased at
minimum costs .economic order quantity is the point at which inventory carrying
cost is equal to order costs E.O.Q. is made. 01' two parts.

Ordering cost. Carrying cost.

EOQ = 2All
I
Where:
A Annual.
B Cost of placing an order/. Ordering cost or buying cost
PCI' unit
1 Inventory carrying cost of one unit
C*S(cost per unit*storage cost)
a) Minimum Level or safety stock level:
It represent the minimum qty. of an item, which must be keep in store at all time
.the main (II' determination of minimum level is that ,due to this, production should
not be stoped.Calcu1all' formula of min. stock level is as follows

Minimum level = Re-ordering level-(Normal consumption*Normal

Re-order – period
.
b) Maximum Level:
It represents the maximum quantity of an item of material which can be held in
stock at any time .stock should not exceed this quantity .the quantity is fixed so that
there may bb no overstocking .the formula of maximum stock level given by
WHELDON is as follows

Maximum stock level= Reordering level + Re-ordering Quantity-(Minimum

Consumption*Minimum Reordering period)
'--
c) Average stock level:
The average stock level is calculated by the following formula:
Average stock level = Minimum stock level + ½ of re-order quantity

d) Reordering level:-
The order is sent before the materials reach minimum stock level.

Re-order level = Safety stock + (Average usage *Average re=-order period)

OR
Maximum consumption * Maximum Re-order period
OR
Maximum usage * Maximum lead time
SAMPLE & TOOLS

1. First in first out (FIFO) method:

Under this method material is first issued from the earliest consignment on hand
and priced at the cost at which that consignment was placed in the stores .in other
words, materials received first arc issued first. The units in the opening stock of
materials are treated as if they are issued (first,
the units from the first purchase issued next and so on until the units left in the
closing stock of materials arc valued at the latest cost of purchases.
['his method is most suitable in times of falling price of materials to jobs or works
orders will he high, while the cost of replacement of materials will be low .but in
case of rising prices this method is not suitable because the issue price of materials
to production will be low ,while the cost of replacement of materials will be high.
Advantages of FIFO Method:
. Main advantage of FIFO method is that it is simple to understand and easy to
operate.
. It is logical method because it takes into consideration the normal procedure. Of
utilizing first those materials which arc received first .Materials are issued in order
of purchases, <; 0 materials received first are utilized first.
. Under this method, materials are issued at the purchase price; so the cost of jobs or
work order is correctly ascertained so far as cost of materials is concerned. Thus,
the method recovers the cost price of the materials.
. This method is useful when prices are falling.
. Closing stock of materials will be valued at the market price as the closing stock
under this method would consist of recent purchase of materials.
. This method is also useful when transactions arc not too many and price of
materials are fairly steady.
Disadvantages of FIFO method:
. This method is increase the possibility of clerical errors, if consignment are
received frequently at fluctuating prices as every time an issue of materials is
made ,the store ledger clerk will have to go through his record to ascertain the price
to be charged.
. For pricing one requisition more than one price has often to be taken.
. When prices rise ,the issue price does reflect the market price as material are issue
from the earliest consignment .therefore the change of production is low because
the cost of replacing the material consumed will be higher than the price of issue.

2) Last in first out method (LIFO) method:

The issues under this method are priced in the reverse order of purchase i.e., the
price of the latest available consignment is taken. This method is sometimes known
as the replacement cost method because materials are issued at the current cost to
jobs or work orders except when purchases were made long ago. This method is
suitable in times of rising prices because material will be issued from the latest
consignment at a price which is closely related to the current price levels. This
method was first introduced in the U.S.A.during the Second World War to get the
advantages of rising prices
Advantages of LIFO Method:
. Like FIFO method, this is simple to operate and is useful when transactions are
not too many and the prices are fairly steady.
. Like FIFO, this method recovers cost from production because actual cost of
material is charged to production. .
. In times of rising prices, LIFO method of pricing issues is suitable materials are
issued at the current market prices which arc high .this method thus helps in
showing a lower profit because of increased charged to production during
periods of rising prices and lower profit reduces burden of income-tax..

Disadvantages of LIFO Method

. Like FIFO, comparison between one job and the other job will become difficult
because one job started a few minutes after another of the same type many bear
are different charged of materials consumed.
. Like FIFO, this method many lead to clerical errors as every time as issue is made.
till. Stored ledger clerk will have to go through the record to as certain the price to
be charge’. For pricing a single requisition, more than one price has often to be
adopted. . The stock in hand is valued at price which does not reflect current market
price.
3) A VERAGE COST METHOD:
The principle on which the average cost method is based is that all of the materials
in store arc show mixed up that an issue can not be made from any particular lot of
purchases and, there fore, it is proper if the materials arc issued at the average cost
of materials in store.
Average may be of
two types:
I) Simple arithmetic average.
2) Weighted arithmetic
average.

Simple average price: A price which is calculated by dividing the total of the prices
of the material in the stock from which the material to be period could be drawn by
the number of the prices used in that total.
Weighted average price: A price which is calculated by dividing the cost of
materials in the stock from which the materials to be priced could be drawn by the
total quantity of materials in the stock.
 2.2. OBJECTIVE OF STUDY

OBJECTIVE OF STUDY

1. To highlight the policies and procedures of Material cost control

2. To make a detailed analysis of the strategies adopted by the company for
planning and monitoring costs
3. To identify the vertical areas where greater attention is needed for better
management.
4. To find our better plan for company for controlling material.
PERSONAL POLICIY

QUALITY ASSURANCE OF CADBURY

1. Market high quality, superior value products that consistently meet our
specifications and comply with local regulatory requirements, while continuously
improving and exceeding our consumers ‘expectations.
2. Guarantee that our customers and consumers come first by actively
listening and understanding their quality and value expectations at the points of
purchase and consumption.
3. Ensure that any representation of our company image, including our products and
trademarks, meet approved standards, reinforce our commitment to quality and
safeguard the reputation of Cadbury.
4. Maintain a “right first time” culture that consistently embraces quality and food
safety, where everyone understands their responsibilities and accountabilities.
5. Operate audited quality management systems that continually improve processes
to deliver this policy and our standards.
6. Assign clear management accountability for setting and meeting measurable
goals and targets for quality and food safety.
7. Work with our supply chain and business partners to assure compliance with our
quality policy and systems, ensuring quality throughout our supply chain.
8. Place continuous improvement at the heart of our performance enabling us to
deliver superior products and service to our consumers and customers.
9. Create a passion for quality where success and achievement are communicated,
recognized and celebrated.

ENVIRONMENT, HEALTH AND SAFETY POLICY

At Cadbury PLC, we see sound and responsible environmental, health

and safety (EHS) management as an integral part of achieving our goal to grow
the value of our confectionery and beverages businesses for our shareowners.

We believe that such an approach will generate and sustain significant

environmental, social and financial benefits, thereby contributing to our objective
of long-term sustainability.
1. Conduct our business in compliance with environmental, health and safety laws
and with our global standards, and regularly assess the compliance of our
operations against these requirements.
2. Maintain and continually improve systems to manage our EHS responsibilities,
establishing and ensuring employee accountability for our EHS performance at all
levels of the organization.
3. Set clear targets for continual improvement in our EHS performance and monitor
these targets to ensure that they are met.
4. Strive to prevent pollution and to minimize the environmental costs and impacts
of our global operations.
5. Provide a safe and healthy environment for our employees, contractors and other
visitors to our sites
6. Train and motivate our employees to understand their EHS responsibilities and to
participate actively in our EHS programmers
7. Communicate with our shareowners, employees, customers and other interested
parties by regularly reporting on our EHS performance and maintaining an open
dialogue.
8. Review and update this policy regularly.

PRODUCTION & OPERATION

PRODUCT OF MALANPUR FACTROY

The story of Cadbury Dairy Milk started way back in 1905 at Bourneville, U.K.,
but the journey with chocolate lovers in India began in 1948.

The pure taste of Cadbury Dairy Milk is the taste most Indians crave for when they
think of Cadbury Dairy

Recently, Cadbury Dairy Milk Desserts was launched, specifically to cater to the
urge for 'something sweet' after meals.

Cadbury Dairy Milk has exciting products on offer - Cadbury Dairy Milk Wowie,
chocolate with Disney characters embossed in it, and Cadbury Dairy Milk 2 in 1, a
delightful combination of milk chocolate and white chocolate. Giving consumers an
exciting reason to keep coming back into the fun filled world of Cadbury.

Our Journey:

Cadbury Dairy Milk has been the market leader in the chocolate category for years.
And has participated and been a part of every Indian's moments of happiness, joy
and celebration. Today, Cadbury Dairy Milk alone holds 30% value share of the
Indian chocolate market.

In the early 90's, chocolates were seen as 'meant for kids', usually a reward or a
bribe for children. In the Mid 90's the category was re-defined by the very popular
`Real Taste of Life' campaign, shifting the focus from `just for kids' to the `kid in
all of us'. It appealed to the child in every adult. And Cadbury Dairy Milk became
the perfect expression of 'spontaneity' and 'shared good feelings'.

The 'Pappu Pass Ho Gaya' campaign also went on to win Silver for The Best
Integrated Marketing Campaign and Gold in the Consumer Products category at the
EFFIES 2006 (global benchmark for effective advertising campaigns) awards.

Did You Know:

Cadbury Dairy Milk emerged as the No. 1 most trusted brand in Mumbai for the
2005 edition of Brand Equity's Most Trusted Brands survey.

During the 1st World War, Cadbury Dairy Milk supported the war effort. Over
2,000 male employees joined the armed forces and Cadbury sent books.
MARKETING OF CADBURY

Dairy Milk has always tried to keep a strong association with milk, with slogans
such as "a glass and a half of full cream milk in every half pound" and
advertisements that feature a glass of milk pouring out and forming the bar.

campaign for the Fruit & Nut variety ("everyone's a fruit and nutcase")
was particularly memorable and featured the writer, radio and television
personality Frank Muir.

On 9 March 1976, American singer Neil Diamond performed a concert televised

throughout Australia during which he did a humorous live commercial
for Dairy Milk. This concert, including the ad as a bonus selection, was
released on DVD on 1 July 2008.

In 2004, Cadbury's started a series of television advertisements in the United

Kingdom and Ireland featuring a person and an animal representing the person's
happiness debating whether to eat one of a range of bars including Dairy Milk.
In 2005, Cadbury's original Dairy Milk bar celebrated its 100th birthday, being first
sold in 1905. It remains the UK's biggest selling chocolate brand. Dairy Milk is sold
in the United States under the Cadbury label, but it is manufactured by the
Hershey's company in Pennsylvania.
On 28 March 2008, the second Dairy Milk advert produced by Glass and a Half
Full Productions aired. It features several trucks at night on an empty runway at a
Mexican airport racing to the tune of Queen's "Don't Stop Me Now". The ad
campaign ran at the same time as the problems at Heathrow Terminal 5 with
baggage handling; in the advert baggage was scattered across the runway.

On 5 September 2008, the Gorilla advert was relaunched with a new soundtrack –
Bonnie Tyler's "Total Eclipse of the Heart" – a reference to online mash-ups of the
commercial. Similarly, a version of the truck advert appeared, using Bon Jovi's
song "Living' on a Prayer".
News Related to Cadbury

1. Cadburys relaunches Bourneville chocolates news 15 October, 2008

Bourneville, a much neglected dark chocolate bar from Cadburys' has been
relaunched as a new category of dark chocolates in India.

"Dark chocolate is one of the fastest growing categories abroad. However, in India,
it is still in a nascent stage.

Thus, we are almost doing category creation with this launch," said Sanjay Purohit,
executive director- marketing and international business, Cadbury India

2. Festive campaigns by Coca Cola and Cadburys news 03 October 2008

Coca Cola has launched a special festive season communication drive of its
carbonated drink brand Thums Up. While the "Taste the Thunder" TV
commercial features Akshay Kumar performing acts like mountaineering and
roller coaster ride, the company is also launching a similar initiative for the market
in southern states featuring Tollywood star Mahesh Babu.

The initiative comes as a follow-up to the company's announcement of venturing

into the 350 ml pack segment of all its major brands.

3. Cadbury and Tamil Nadu Agricultural University join hands for cocoa
research project news 30 May 2008

Mumbai: Cadbury Asia Pacific, the Asian arm of UK confectionery giant Cadbury
Plc, has recalled 11 types of its Chinese-made chocolate as a precaution, the Hong
Kong government said in a statement.

In a statement, issued from its Singapore office, Cadbury said it has

recalled 11 chocolate products as tests ''cast doubt on the integrity of a range of
our products manufactured in China.''

The products were meant for distribution in Taiwan, Hong Kong and Australia, it’s
said.

Tests ''cast doubt on the integrity of a range of our products manufactured in

China,'' Cadbury said in the statement issued from its office in Singapore.

4. Cadbury, others recall China-made confectionery news 29 September 2008

Mumbai: Cadbury Asia Pacific, the Asian arm of UK confectionery giant Cadbury
Plc, has recalled 11 types of its Chinese-made chocolate as a precaution, the Hong
Kong government said in a statement.

In a statement, issued from its Singapore office, Cadbury said it has

recalled 11 chocolate products as tests ''cast doubt on the integrity of a range of
our products manufactured in China.''

5. Worm turns for Cadbury news Mohini Bhatnagar 28 November 2003

Hyderabad: The worms in the chocolate bars controversy has hit Cadbury India
where it hurts most and that is in sales. The company today faces tough
times ahead as the business environment for its chocolates becomes
increasingly negative with rising raw material prices and low consumer sentiments,
post the worms controversy in October this year.

6. Cadbury India net profit at Rs 190 million news 13 July 2002

Mumbai: Cadbury India Ltd has posted a net profit of Rs 190 million for the
quarter ended 16 June 2002 as compared to Rs 93.60 million for the quarter ended
17 June 2001.
STRENGTH & WEAKNESS

Strengths

• Cadbury is the largest global confectionery supplier, with 9.9% of global

market share.
• Strong manufacturing competence, established brand name and leader in
innovation.
• Advantage that it is totally focused on chocolate, candy, chewing
gum, unique understanding of consumer in these segments.

Weaknesses
• The company is dependent on the confectionery and beverage market,
whereas other competitors e.g. nestle have a more diverse product portfolio,
where profits can be used to invest in other areas of the business and R&D.
• Other competitors have greater international experience - Cadbury has
traditionally been strong in Europe. New to the US, possible lack of
understanding of the new emerging markets compared to competitors.
Suggestions

1. Necessary knowledge and skills about new learning strategies at all levels;

2. Accreditation of the current teacher training and staff development programs

offered by various providers;

3. A critical mass of local experts to spread the new knowledge and skills

throughout the teachers in the country;

4. Suitable alternative model for in-service training;

5. A plan for national implementation;

Indication of support and commitment by the government

SPECIAL POINT

Use of Advertising'

No. 1 FMCG Company

Cadbury India has been ranked as the 7th Great Place to Work and the No. 1 FMCG
company in India in 2008, by the Great Place to Work Institute.

Great Place to Work 2007'

Cadbury India' has been awarded the "Bronze Award for Excellence in People
Management" in the 'Great Place to Work 2007' survey conducted by Grow
Talent Company Limited and Business world. The award recognizes Cadbury India
as a national leader in the area of Human Resource Management.

Great Place to Work 2007'

Cadbury India' has been awarded the "Bronze Award for Excellence
in People Management" in the 'Great Place to Work 2007'
survey conducted by Grow Talent Company Limited and Business world. The award
recognizes Cadbury India as a national leader in the area of Human
Resource Management.

Cadbury India received a bronze award at the Cannes Lions International

Advertising Festival for partnering with a mobile phone operator in 2005 to provide
exam results via SMS to school children.
Reader's Digest Award recognizes Bourn vita

Bourn vita won the 'Reader's Digest Trusted Brands' Gold Award
for the vitamin health supplement category in Indian in 2006.
The merit was based on 7000 responses from questionnaires and
telephone interviews across Asia.

Suraksha Puraskar Award – 2005

Cadbury India's Bangalore factory has received the
"Suraksha Puraskar" safety award from the National Safety
Council - Karnataka chapter.

ABBY Award wins for India.

The prestigious ABBY awards, held in March, recognize creative excellence

in the Indian Advertising Industry. The Ultra Perk campaign won four Silver
Awards in total and the Cadbury Dairy Milk Campaign, Miss Palampur,
also won a Silver Award. This year Cadbury also sponsored the new 'Young
ABBY' Award.

Cadbury wins the Effies 2006

At the recent Effie 2006 awards organized by The Advertising Club of Mumbai, our
'Pappu Pass Ho Gaya' advertising campaign bagged two more awards - Gold in the
Consumer Products category and Silver in the integrated advertising campaign
category.
INTRODUCTION

INTRODUCTION of TOPIC

In India we believe that effective communication and availability of information at the

right team and time and right place is critical for an edge in business. In order to
achieve this we realize to importance of and have in place, an effective IT
infrastructure.
Cost accounting isn’t just collecting data for history. it is an important tool in
predicting and assuring future profitability . We can’t overstress the importance of
our costing tools that provide complete cost estimates at the time of quotation/order
entry based on your latest materials, labor and overhead costs.

MATERIAL COST CONTROL

Material cost control is the management of cost of material it consists of the

following.
5. Capital costs
6. Storage costs
7. Risk of price decline
8. Risk of obsolescence

MATERIAL

Material is very important factor for production. it includes physical commodities

used to manufacture the final end product. It is the starting point from which the first
operation starts. Materials refer to all of commodities in the process of manufactures.
Proper control of material is necessary from the time order of purchase material is
placed with supplies. Until the have been consumed.

COST
It is the amount of resources given up in exchange for some goods or services. The
cost is that which is given or a sacrifice to obtain something cost is also different from
value as cost is measured in terms of money whereas values is measured in terms of
usefulness or utility of an article.
We can define as : the amount of expenditure ( actual or notional ) incurred on or
attributable to a given thing or to ascertain the cost of a given thing.
RESULTS & DISCUSSION

• During my research in “CADBURY INDIA LTD., MALANUR” I found that

MATERIAL COST CONTROL is an integral part of industrial success.
• For purchasing material we should concentrate on the cost of material through
material cost control company can take a top position in corporate market.
• Material cost has played a very important role in economic condition of
company.
• After analyzing the data I have reached the conclusion that the miscellaneous
expenditure of the company has reduced which is good sign and shows the
capability of the company in handling wastage, losses and bad debts.
DISCUSSION
I have found here these below things from analysis of data.

• For economic purchase order of 114 units of MS PIPE. We analysis of three

quotations for choosing lower cost of material. We select the B.D. Raj. & Co’s
quotation because the lower cost of material. This is the 56185.469 with
applying 4% ST & fright.
• In store material we found these below things from the store keeping receipt.
Here we show about the two type of material.

ITEM CODE Re-order level Max. stock Min. stock Avg. stock
level level level
CC5801008 1290 1700 540 990
CC5801009 2700 3600 900 1500

As such we can get these levels for further items.

• For issuing the material we found the knowledge through FIFO and LIFO
method. How material received in store and how should issue it from the store
etc.
• During my research period. I have found material cost control management of
the company is very sound that’s why their economic position is also very
sound.
OBJECTIVES OF STUDY

OBJECTIVES OF STUDY

1. To highlight the policies and procedures of Material cost control

2. To make a detailed analysis of the strategies adopted by the company for
planning and monitoring costs
3. To identify the vertical areas where greater attention is needed for better
management.
4. To find our better plan for company for controlling material.
SUGGESTIONS

There are some suggestion,which may certainly improve the efficiency of material
cost control management.

• FIFO and LIFO methods should be apply for keeping and issuing the material
in stores.
• I suggest through research in this regard to arrive at some suitable mix of both
this method which gives due consideration to value, quality importance etc of
stock items.
• The maximum and minimum level of each item should be indicated to avoid
over-stock or under-stock situation.
• Internal performance report an inventory on at least monthly basis should be
prepared to study the material price variance, material usage and inventory
level variance from hr estimate figure.
• Material should be purchase at the lower cost but also quality should be
maintains.
CONCLUSION
References (Co site )
link retrieved on -----date
1. Kothari C.R. , Research methodology (Methods & Techniques),
Wishwa Prakashan, 24th Reprint March 1999/

2. CHANDRA PRASANNA, FINANCIAL MANAGEMENT, Tata Megraw-

Hill publishing com. Ltd. New Delhi, Fifth edition 2002.

3. Shukla SM, ACCOUNTING FOR MANAGERS, SAHITYA BHAWAN

PUBLICATION COM. Ltd Raipur.

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