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LAHORE SCHOOL OF ECONOMICS

STRATEGIC SUPPLY CHAIN MANAGEMENT

FINAL PROJECT REPORT

MBA SECTION: B

GROUP NUMBER: 9

GROUP NAMES: Asfand Anees , Billawal Nawaz, M. Umer, M. Umar Khan

SUBMITTED TO: MS. MAHVESH MAHMUD

INDUSTRY/ORGANIZATION NAME: K&N’s

TOPIC QUESTION: Supply Chain Integration and Distribution

DATE OF SUBMISSION (DAY/MONTH/YEAR): 12-04-2019


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TABLE OF CONTENTS

HISTORY------------------------------------------------------------------------------------------- 4

K&N’S BACKGROUND------------------------------------------------------------------------- 4’

INTEGRATED SUPPLY CHAIN MANAGEMENT------------------------------------------ 5

K&N’s SPPLY CHAIN PRACTICES--------------------------------------------------------- 6

K&N’S SUPPLY CHAIN STRATEGY------------------------------------------------------- 7

K&N’S DISTRIBUTION NETWORK------------------------------------------------------- 7

RAW MATERIAL AND INVENTORY------------------------------------------------------ 8

RECOMMENDATION---------------------------------------------------------------------- 9

APPENDIX-----------------------------------------------------------------------------------10

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History

In 1964 when Pakistan was a young and independent nation moving towards a dream of self sufficiency

in food production. Improper nutrition food remained the major proper in Pakistan. Majority of the people

died because of the diseases such as protein, vitamins and minerals deficiency. Poultry production was the

quickest and the least expensive way of filling the gap and eliminate the diseases which were there.

A man named Khalil Sattar saw this vision and opportunity in January 1964 of filling this gap in the

market to establish a poultry farm. It was his interest due to which he started a broiler farm of around

1000 chickens. That was the beginning of K&N’s where providing best nutrition for the health and

happiness of the children

About K&N’s

K&N’s is the founding pillar and beacon for Pakistan poultry industry- started in 1964 with a single-

minded objective of providing better nutrition for health and happiness of the nation. Building on years of

poultry expertise, and a commitment to food-safety, K&N’s integrated all poultry production activities

under one umbrella to ensure quality and food-safety by managing and controlling all stages of

production. It is a marvellous food industry located at Raiwind. It deals with poultry processing. K & N’s

Poultry processing is integrated business containing essential components like breeder farms, hatchery,

and broiler growing farms, feed mill and poultry processing plant. K & N’s is main supplier of eggs in

Pakistan and is the biggest poultry industry in Pakistan. Formerly K &N’s food was M.ARTAL Poultry

Int’l Private Limited. M.ARTAL was Belgium base. It was registered in Holland. M.ARTAL Poultry

processing plant started work on August, 03, 1998.

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Integrated Supply Chain Management

Integrated supply chain management refers to an enterprise resource planning approach to SCM. A

business facilitates relationships with all of its suppliers and manages all distribution and logistics

activities through a centralized system rather than having multiple systems within the organization.

Concentrated professional expertise and cost efficiency are core benefits of SCM, but developing

collaboration is an obstacle.

Integrated supply chain benefits in number of ways. Major advantage of Integrated Supply Chain

Management is the cost efficiency. With an integrated system, you are one buyer purchasing larger

volumes of goods, which enables you to get lower prices. The company also is able to have a

smaller, dedicated staff in its SCM function than it likely would if it were paying people in all

divisions or departments to manage activities.

Another factor is Flexibility which is ability to adapt to different situations. T his allows businesses

to perform work more quickly and fluidly than it would be possible with a traditional logistic

model. One example of this flexibility is just-in-time capability, in which just enough freight is used to

meet daily demand. This limits the amount of warehouse space used and helps keep costs down. While

very beneficial to a company’s costs and space, this method can be detrimental if the supply chain

isn’t effective or responsive enough, limiting inventory and creating delays and ultimately costing

more than the savings are worth. However, it also makes you eliminate the waste. Integrating your

supply chain will dramatically reduce waste in several areas. You will save on space in warehousing

due to better route management. This will also save on emissions helping you to meet low-waste

environmental goals. Trucks will be filled on every leg of the route maximizing cube and ensuring that

you don’t have empty trucks driving around. This means that you will be more efficient and save

money.

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K&N’s Integrated Supply Chain Practices
Poultry Breeding: K&N’s maintains layer and broiler parent stock populations in different regions of

Pakistan. Layer parent stock farms are located in the south and broiler parents are bred in the colder

mountainous northern region. Both types of parents are housed at isolated breeder farms. K&N’s operates

several strategically located hatcheries covering all day-old chick markets to ensure delivery of high-

quality layer and broiler day-old chicks to commercial farmers throughout Pakistan.

Hatching: All hatcheries are equipped with most modern cooling, heating and humidification systems to

provide a uniform and consistent hatchery environment independent of varying outdoor weather

conditions. Incubators from world-renowned manufacturers are installed at all hatcheries and their

performance data is recorded and monitored by a computerized incubation monitoring system.

Boiler Growing: In addition to supplying day-old chicks to farmers, K&N’s is also engaged in broiler

growing at company owned farms to produce broilers for our poultry processing plant. Under the

watchful eye of their own poultry nutrition, health and housing specialists, they grow-up in large, clean

and airy houses equipped with state-of-the-art heating, cooling and ventilation equipment. The chickens

freely strut around, breathe fresh air, eat at will and drink fresh, cool and pure water. They really mean

pure water as their chickens do not drink water from troughs, which can lead to water contamination.

Feed Milling: To ensure consistent performance with high standards, our chickens really live on a

healthy and well-balanced diet. It is based on: natural grain products such as corn, corn gluten, rice and

wheat; oil seed meals such as soybean, canola and sunflower; fish; oyster shells supplemented with multi-

vitamins and minerals.

Poultry Processing: After Halal slaughter, chickens are processed in the most hygienic and automated

manner. During processing, the birds are washed inside out and our veterinarians constantly examine the

birds to confirm they are wholesome. Cleaning is constant and each evening the entire operation is

completely washed and sanitized.

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K&N’s Supply Chain Strategy:

Supply chain in K&N’s is all about movement of goods from supplier to a customer as well as the returns

from the customers or their service needs. The information flow involves getting orders of the chicken or

any of their product division, making sure the production is ready, ensuring the goods are ready and

packaged for delivery, goods are delivered to the customer on time. Supply chain of K&N’s can be

divided into three main flows:

Supply Chain Goal: To reduce the inventory (Products available when needed) (JIT)

Supply Chain Management: Coordinating and integrating within and among companies

Oversight of materials, information and finances as they move in process

K&N’s Distribution Network:

NORTHERN SOUTHERN
CENTRAL
(RAWALPINDI REGION
AND (LAHORE)
(KARACHI)
ISLAMABAD)

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Reasons for maintaining Raw Material Inventory
K & N’s have raw material inventory warehouses attached to the production facilities where raw

materials, consumables and packing materials are stored and issue for production on JIT basis. The

reasons for holding inventories can vary from case to case basis.

 Variation in meet Production Demand

 Economies of Scale in Procurement

 Cater to Cyclical demand

 Benefit of price increase and quantity discount

 Reduction of Transit cost and Transit time

 The need of holding Long lead and High demand items.

Warehousing/Storing Management

Inventory Management and Warehousing/storing form a part of operations intensive function and is one

of the key building blocks in the entire chain. Most of the inventory is held at the warehouses and storing

as compared to the pipeline, and the efficiency of the warehouse operations will determine the further

supply chain efficiency. Though it is a normal industry practice now to outsource the warehousing

operations to a 3PLLogistics service provider but K & N’s supply chain management believes to build its

own warehouses and cold storages to reduce costs and keep its inventory in safe environment.

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Recommendation

The only recommendation for K&N’s is that they should use a warehouse management system which will

control their inventory and the demand of their products can be met more efficiently and cheaply. The

Warehouse Management System controls two sets of operations:

1. On the inventory front, the system maintains inventory in the warehouse at Zone & individual location

level, SKU level, pallet wise, carton wise and unit level inventories for multiple customers and allows

specific inventory attributes and parameters to be built in to manage, allocate or block the inventory. The

system also provides options to adapt FIFO method as the products are perishable.

2. On the Operations front the system manages, controls and directs all operations including receiving

processes, put away processes, order processing, inventory allocation, picking process, packing process

and finally shipment along with inventory updating. The K & N’s intelligent system guides and helps

operations manager to schedule and manage all operations for various groups and teams simultaneously

depending upon the work load and pattern and thereby manage resource allocation too

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Appendix

Supply Chain Strategy K&N’s

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Supply Chain Framework K&N’s

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Distribution Network K&N’s

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MBA SECTION: B
LAHORE SCHOOL OF ECONOMICS

STRATEGIC SUPPLY CHAIN MANAGEMENT

ORGANIZATIONAL FEEDBACK FORM


(TO BE COMPLETED BY THE PERSON CONTACTED AT THE ORGANIZATION. PLEASE ATTACH THIS AT THE BEGINNING OF THE
PROJECT REPORT)

Please tick the appropriate response.


Q1. Was the question chosen for the project useful from an industry-academic linkage point-of-
view?
Yes No

Q2. Were the student(s) professional in terms of punctuality and conduct?


Yes No

Q3. Were the student(s) professional in terms of asking appropriate questions related to their
project report?
Yes No

Q4. Was the final project report useful in terms of the feedback given to the organization?
Yes No

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Any comments and feedback:

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Signature:

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