Professional Documents
Culture Documents
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Chapter I
1.1 INTRODUCTION
COCA-COLA, the product that has been given the world its best-known taste was
born in Atlanta, Georgia, on May 8, 1886. COCA-COLA Company is the world’s leading
manufacturer, marketer and distributor of non-alcoholic beverage concentrates and syrups,
used to produce nearly 400 beverage brands. It sells beverage concentrates and syrups to
bottling and canning operators, distributors, fountain wholesalers. The company’s beverage
products comprises of bottled and canned soft drinks as well as concentrates, syrups and not-
ready-to-drink powder products. In addition to this, it also produces and markets sports drink,
tea and coffee. The COCA-COLA Company began building its global network in the 1920s.
Now operating in more than 200 countries and producing nearly 400 brands, the COCA-
COLA system has successfully applied a simple formula on a global scale:” provide a
moment of refreshment for a small amount of money-a billion times a day”.
The COCA-COLA Company and its network of bottlers comprise the most
sophisticated and pervasive production and distribution system in the world. More than
anything, that system is dedicated to people working long and hard to sell the products
manufactured by the company. This unique worldwide system has made the COCA-COLA
Company the world’s premier soft-drink enterprises. For more than 115 years, COCA-COLA
has created a special moment of pleasure for hundreds of millions of people every day.
The company aims at increasing shareowner value over time. It accomplishes this by
working with its business partners to deliver satisfaction and value to consumers through a
worldwide system of superior brands and services, thus increasing brand equity on a global
basis. They aim at managing their business well with people who are strongly committed to
the company values and culture and providing an appropriately controlled environment, to
meet business goals and objectives. The associates of this company jointly take responsibility
to ensure compliance with the framework of policies and protect the company’s assets and
resources whilst limiting business risks.
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1.2 COMPANY PROFILE
ABOUT THE COMPANY
COCA-COLA was the leading soft drink brand in India until 1997, when it left rather
than reveals its formula to the Government and reduces its equity stake as required under the
foreign regulation Act (FERA) which governed the operations of foreign companies in India.
COCA-COLA reentered the Indian market on 26th October 1993 after a gap of 16 years, with
its launch in Agra. An agreement with Parle group gave the company instant ownership of the
top soft drink brands of the nation. With access to 53 of Parle’s plants and a well set bottling
network, an excellent base for rapid introduction of the company’s international brands was
formed. The COCA-COLA company acquired soft drink brands like Thumps-up, Gold spot,
Limca, Mazza, which were floated by Parle, as these products had achieved a strong
consumer base and formed a strong brand image in Indian market during the re-entry of
COCA-COLA in 1993.Thus these products became a part of range of products of the COCA-
COLA company.
In the new liberalized and deregulated environment in 1993, COCA-COLA made its
re-entry into India through its 100% owned subsidiary, HCCBPL , the Indian bottling arm of
the COCA-COLA company. However this was based on numerous commitments and
stipulations which the company agreed to implement in due course. On such major
commitment was that, the Hindustan COCA-COLA Holdings would invest $5 billion in India
from 2012 to 2020 to capture the Indian market.
COCA-COLA is made up of 7000 local employees, 500 managers, over 60
manufacturing location, 27 companies owned bottling operation (COBO), 17 Franchisee
Owned Bottling Operations (FOBO) and a network of 29 contract packers that facilitate the
manufacture process of a range of products for the company. It also has a supporting
distribution network consisting of 15, 00,000 retail outlets and 15000 distributors. Almost all
goods and services required to cater to the Indian market are made locally, with help of
technology and skills within the company.
“Think local, act local”, was the mantra that COCA-COLA follows, with punch lines
like “Life has to aisi” for the urban India and “Thanda matlab COCA-COLA” for the Rural
India. The resulted in a 37% growth rate in rural India visa-vie 24% growth seen in urban
India between 2011 and 2012, the per capita consumption of cold drinks doubled due to the
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launch of the new packaging of the 200 ml returnable glass bottles which were made
available at price of Rs.10 per bottle. This new market accounted for over 80% of India’s new
COCA-COLA drinkers. At COCA-COLA, they have a long standing belief that everyone
who touches their business should benefit, thereby including them to upload these values,
enabling the company to achieve success, recognition and loyalty worldwide.
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1920s … Bottling overtakes fountain sales
As the 1920s dawned, more than 1,000 Coca-Cola bottlers were operating in the U.S.
Their ideas and zeal fueled steady growth. Six-bottle cartons were a huge hit after their 1923
introduction. A few years later, open-top metal coolers became the forerunners of automated
vending machines. By the end of the 1920s, bottle sales of Coca-Cola exceeded fountain
sales.
1920s and 30s … International expansion
Led by longtime Company leader Robert W. Woodruff, chief executive officer and
chairman of the Board, the Company began a major push to establish bottling operations
outside the U.S. Plants were opened in France, Guatemala, Honduras, Mexico, Belgium,
Italy, Peru, Spain, Australia and South Africa. By the time World War II began, Coca-Cola
was being bottled in 44 countries.
1940s … Post-war growth
During the war, 64 bottling plants were set up around the world to supply the troops.
This followed an urgent request for bottling equipment and materials from General
Eisenhower's base in North Africa. Many of these war-time plants were later converted to
civilian use, permanently enlarging the bottling system and accelerating the growth of the
Company's worldwide business.
1950s … Packaging innovations
For the first time, consumers had choices of Coca-Cola package size and type the
traditional 6.5-ounce contour bottle, or larger servings including 10-, 12- and 26-ounce
versions. Cans were also introduced, becoming generally available in 1960.
1960s … New brands introduced
Following Fanta® in the 1950s, Sprite®, Minute Maid®, Fresca® and TaB® joined
brand Coca-Cola in the 1960s. Mr. Pibb® and Mello Yello® were added in the 1970s. The
1980s brought diet Coke® and Cherry Coke®, followed by POWERADE® and DASANI®
in the 1990s. Today hundreds of other brands are offered to meet consumer preferences in
local markets around the world.
1970s and 80s … Consolidation to serve customers
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As technology led to a global economy, the retailers who sold Coca-Cola merged and
evolved into international mega-chains. Such customers required a new approach. In
response, many small and medium-size bottlers consolidated to better serve giant
international customers. The Company encouraged and invested in a number of bottler
consolidations to assure that its largest bottling partners would have capacity to lead the
system in working with global retailers.
1990s … New and growing markets
Political and economic changes opened vast markets that were closed or
underdeveloped for decades. After the fall of the Berlin Wall, the Company invested heavily
to build plants in Eastern Europe. And as the century closed, more than $1.5 billion was
committed to new bottling facilities in Africa.
21st Century …
The Coca-Cola bottling system grew up with roots deeply planted in local communities.
This heritage serves the Company well today as people seek brands that honor local identity
and the distinctiveness of local markets. As was true a century ago, strong locally based
relationships between Coca-Cola bottlers, customers and communities are the foundation on
which the entire business grows.
Company Overview:-
Hindustan COCA-COLA Beverage Pvt. Ltd. Khordha. It is one of the bottling plants
of “COCA-COLA “under the Khordha plant there is another bottling plant in Rourkela,
where only RGB production happens. HCCBPL, Khordha plant was established in the year
2000 under the authority of COCA-COLA, India. This plant is the 3 rd largest plant after
Ahmadabad and Rurki in term of production of finished goods. The production plant is
situated in Khordha Industrial Estate, where the production and distribution work are done.
Both Odisha and Jharkhand zone come under this region. Jharkhand is fully depending on
Khordha plant because no production plant is there.
So from Khordha plant, goods are sent to distributor in two ways, one is from directly
from its plant and another is through its Depot. Because to the long distance route they are
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sending to their depot. Mainly Khordha plant has 6 locations for Odisha region for
distribution and production and 4 locations for Jharkhand for only distribution.
In HCCBPL, Khordha there are 5 production lines which are presently operating.
These are
5. WTR 75 BPM
Proposed expansion plan is about the inventory management of all these which is the
subject of my study. These are the list of manufacturing plant and depot of Khordha
division:-
ODISHA
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X8- Ranchi (Direct Depto):- Goods are sending from F1 location to here and distributed to
directly retailer.
X9- Ranchi (Indirect Depto):- Goods are sending from F1 location to here and distributed
to distributor.
Products
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3C Report
Its stock is listed on the NYSE and is part of DJIA S&P 500 index, the Russell 1000 Index and the
Russell 1000 Growth Stock Index. As of 2015, its chairman and CEO is Muhtar Kent.
The Customer: At Coca-Cola , customers are at the heart of coca-cola. Customer preference
is a core value of the business. This means building true partnerships that create sustainable
value and profitable growth for the business and the customers across all key channels. By
finding new ways to win together in the marketplace, coca-cola aim to be the preferred
supplier to all of the customers.coca-cola target to the whole crowed.its taget to the rich to
the poor.its not only adopted by rich it also reach to the pood with its small size bottle. Mass
generation adopt coca cola.
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sold to various bottlers throughout the world who hold an exclusive territory. The Coca-
Cola Company owns its anchor bottler in North America, Coca-Cola Refreshments.
Its stock is listed on the NYSE and is part of DJIA S&P 500 index, the Russell 1000
Index and the Russell 1000 Growth Stock Index. As of 2015, its chairman and CEO
is Muhtar Kent. products.
PepsiCO
Godrej Beverage
Parle Agro
Mother dairy
Ladakh Foods
Gourmet,etc
SWOT Analysis:
STRENGTH-
WEAKNESS-
Lack of diversification
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Negative publicity
OPPORTUNITY-
THREATS-
Increase competition
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Literature Review
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CHAPTER II
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OBJECTIVES OF THE STUDY
Valuing the inventory, measuring the change in inventory and planning for future
inventory levels.
The value of the Inventory at the end of each period provides a basis for financial
reporting on the balance sheet.
Measuring the change in inventory allows the company to determine the cost of
inventory sold during the period.
The inventory level and changes allow the company to plan for future inventory
needs.
METHODOLOGY
DATA COLLECTION
Two types of data are collected, one is primary data and second one is secondary data.
The primary data were collected from the Department of finance, COCA-COLA
COMPANY. The secondary data were collected from the Annual Report of COCA-COLA
COMPANY, its website, etc.
PLACE OF STUDY
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The project study is carried out at the Finance Department of COCA-COLA
COMPANY Corporate office Situated at KHORDHA, ORISSA. The study is undertaken as
a (MBA) MASTERS IN BUSINESS ADMINISTRATION OF BIJU PATNAIK
UNIVERSITY OF TECHNOLOGY, ODISHA in the form of summer placement.
PERIOD OF STUDY
I have done my project from 20 th May 2015 to 6th July 2015 in Khordha plant of
Hindustan Coca- Cola Beverages Pvt. Limited.
LIMITATIONS
There may be limitations to this study because the study duration (summer placement)
is very short and it’s not possible to observe every aspect of inventory management and
control system practices.
2. Physical handling.
3. Accounting.
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Chapter III
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1. THEORETICAL ANALYSIS
3. ABC Analysis.
The store-keeper plays an important role in deciding upon the various levels
materials. In order to ensure that the optimum quantity of materials is purchased stocked
neither less nor more, the store keeper applies scientific techniques of materials management.
Fixing of certain levels for each item of materials in one of techniques.
These levels are not permanent but require revision according to the change in the
factors which determine these levels. The following levels are generally fixed.
This level is fixed in such a manner that the quantity of materials represented by the
difference between the re-order level and the minimum level will be sufficient to meet the
requirement of production till such time as the order materializes and materials are delivered.
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(b). Maximum Level:
The maximum level is that level of stock which can be held at any time. In other
words, it is the level beyond which stock should not be maintained. The purpose is to
avoid over-stocking and thereby using working capital in a proper way.
This is the level below which the stock of an item should not fall. This is known as
safety or buffer stock. An enterprise must maintain minimum quantity of stock so that
the production is not hampered due to non-availability of materials
Usually stack should not be lower than the minimum level. But if for any reason,
stock comes down below the minimum level, it is called danger level. When the stock
reaches danger level, it is necessary to take urgent action on the part of the management for
immediate replenishment of stock to prevent stock-out situation. The danger level can be
calculated by applying the following formula:
The economic order quantity, known as EOC, represents the most favorable quantity
to be ordered each time fresh orders are placed. The quantity to be ordered is called economic
order quantity because the purchase of this size of material is most economical. It is helpful
to determine in advance as to how much should one buy when the stock level reaches the re-
order level. If large quantities arc purchased, the carrying costs would be large.
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On the other hand, if small quantities are purchased at frequent intervals she ordering
costs would be high. The economic order quantity is fixed at such a level as to minimize the
cost of ordering and carrying the stock. It is the size of the order which produces the lowest
cost of material ordered.
On the other hand, if orders are placed for small quantities, the ordering cost is more
but the carrying cost would be less. Thus the economic order quantity is determined at a point
when the ordering costs and the carrying costs are equal. Only at this stage the total of
ordering cost and carrying cost is minimum.
3. ABC Analysis:
This technique of inventory control is also known as always Better Control technique.
ABC analysis is an analytical method of control which aims at concentrating effects on those
areas where attention is needed most.
According to this approach to inventory control high value items are more closely
controlled than low value items. Each item of inventory is given A, B or C denomination
depending upon the amount spent for that particular item. “:A” or the highest value items
should be under the tight control and under responsibility of the most experienced personnel,
while “C” or the lowest value may be under simple physical control.
“A” Category – 5% to 10% of the items represent 70% to 75% of the money value.
“B” Category – 15% to 20% of the items represent 15% to 20% of the money.
“C” Category – The remaining number of the items represent 5% to 10% of the
money value.
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item of stores. Thus the perpetual inventory is a method of recording store balance after every
receipt and issue to facilitate regular checking and to obviate closing down for stock locking.
Under this method of stocktaking, the verification of the whole of the stock and its
valuation are accomplished only once at the close of the financial year and difference in stock
is adjusted only once. Nevertheless, the periodic inventory has its own disadvantage. In the
first place, it becomes necessary to close down the factory on the day of stock taking.
Secondly, discrepancies in stock cannot be corrected by an executive action immediately as
and when they occur. Thirdly, since all the items are checked only once in a particular day, a
surprise verification will not be possible. Lastly, reason for the discrepancies cannot be found
out because of the long interval between two consecutive verifications.
(i) The elaborate and costly work involved in periodic stock taking can be avoided.
(ii) The stock verification can be done without the necessity of closing down the factory.
(iii) The preparation of interim financial statement becomes possible.
(iv) Discrepancies are easily located and corrected immediately.
(v) It ensures a reliable check on the stores.
(vi) It exercises a moral influence on the stores staff.
(vii) Fast and slow moving items can be distinguished and the fixation of proper stock
levels prevents not only over-stocking, but under-stocking also.
(viii) A perpetual inventory record of the nature of the bin cards enables the storekeeper to
keep an eye on the stock levels and replenish the stock of every item whenever the
limit falls to the recorded level.
(ix) It provides reliable information to the management of the number of units and the
value of every item of stores.
(x) It ensures secrecy of the items that are verified.
When issues are made out of various lots purchased at varying prices, the problem
arises to which of the receipt price should be adopted for valuing the materials requisitions.
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Materials received first will be issued first. The price of the earliest consignment if
taken first and when that consignment is exhausted the price of the next consignment
is adopted and so on. This method is suitable in times of falling prices, because the
material charge to production will be high while the replacement cost of materials will
be low.
Materials received last will be issued first. The price of the last consignment is taken
first and when that consignment is exhausted the price of the second last consignment
is adopted and so on. In timing of rising prices this method will show a charge to
production, which is closely related to current price levels provided that the last
purchase is made recently.
Under this method material issued is priced at the weighted average cost of material in
stock.
5. Current Price :
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DATA ANALYSIS
1. How inventory control works in Coca-Cola?
a) By efficiently tracking qualities across storage location.
b) By common application
c) By popular transaction
d) By improve accuracy
10%
15%
60%
15%
a b c d
Interpretation:
From the above table it shows that inventory controls works in Coca Cola Khordha
by efficiently tracking qualities across storage location is 60%, by common
application 15%, by popular transaction 15% and by improve accuracy by 10%.
2. Are policies and procedures current in waiting and properly approved in Coca-Cola?
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Sl. No. Opinions No. of Respondents Percentage
1 Yes 15 75
2 No 05 25
3 Can’t Say 00 00
Total 20 100
Yes No
Can't Say
75%
Interpretation:
From the above table it shows that 75% respondents are positive that policies and
procedures current in waiting and properly approved in Coca Cola Plant compare to only
25% are negative respondents.
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3. Do the Inventory department compare qualities received against receiving reports etc. in
Coca-Cola?
Yes No
Can't Say
75%
Interpretation:
From the above table it shows that 75% respondents are positive that inventory department
compare qualities received against receiving reports etc. in Cola-Cola whereas compare to
only 25% respondents are negative answers.
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4. Are inventory records reconciled to advantage reports on a regular basis in Coca-Cola?
5.
5%
Yes No
Can't Say
95%
Interpretation:
From the above table it shows that 95% respondents state that inventory records reconciled
to advantage reports on a regular basis in Coca Cola whereas compare to only 5%
respondents are negative answers.
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5. Does management review the reconciliation of physical inventory counts to the
6.
inventory records?
Yes No
Can't Say
85%
Interpretation:
From the above table it shows that 85% respondents are satisfied that management review the
reconciliation of physical inventory counts to the inventory records and 10% are negative
answers whereas 5% can’t say anything.
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6. Is a perpetual inventory system (including quantities and value) in use as to all major
classes of inventory?
6.
Perpetual inventory system (including quantities and value) in use as to all major
classes of inventory
5%
Yes No
Can't Say
95%
Interpretation:
From the above table it shows that perpetual inventory system (including quantities and
value) in use as to all major classes of inventory is 95% whereas compare to only 5%
negative answers.
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7. Are perpetual inventory records update promptly?
7.
Yes No
Can't Say
90%
Interpretation:
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8. Does internal control appear adequate for the inventory system overall?
8.
Yes No
Can't Say
80%
Interpretation:
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9. Does your Organization have a written mission statement?
9.
Yes No
Can't Say
85%
Interpretation:
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10. Do these individuals know how to access the people soft on-line-financial folders that
11.
are made available monthly?
5%
Yes No
Can't Say
95%
Interpretation:
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14. Does your department prepare an annual financial report? Are managers hold
15.
accountable for financial performance?
Yes No
Can't Say
90%
Interpretation:
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15. Has the department established cross-training or contingency plans for significant
16.
changes in personal?
5%
25%
Yes No
Can't Say
70%
Interpretation:
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16. Has your department posted information on how to report suspected instances of
17.
scientific misconduct?
Yes No
Can't Say
90%
Interpretation:
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17. Does your department maintain any confidential employee/student and human subject
18.
research records that requires special treatment for privacy protection?
Yes No
Can't Say
100%
Interpretation:
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18. Have employees been trained for workplace safety by the Environmental Health &
safety officer (EH&C) to comply with the appropriate regular for requirements for their
19.
job responsibilities?
Employees been trained for workplace safety by the Environmental Health & safety
officer (EH&C)
15%
Yes No
Can't Say
85%
Interpretation:
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19. Do your believe that department personal are sufficiently informed about important
federal and state laws and regulations that govern activities performed within your
20.
department?
Yes No
Can't Say
70%
Interpretation:
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20. Are you satisfied the entire inventory process and control system of Coca-Cola?
21.
Yes No
Can't Say
100%
Interpretation:
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CAHPTER
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FINDINGS
Improve data accuracy
Perfect inventory levels record is maintained. The best way to do that is by using mobile
wireless devices and product barcodes. Scanning barcodes is faster and more accurate than
typing product information by hand. the inventory management solution choosen uses
mobile barcode scanner so it is not tied to a desktop computer. it should be able to update the
inventory records from anywhere.
Increase efficiency
One of the main purposes of using inventory management software is to save time and make
your company more efficient. With the right inventory software, your company should see a
decrease in the amount of time it takes to place orders, receive products and pick. Then pack
it and ship products to customer.
They also maintain GRN(Goods Received Note) and SRN(Sells Received Note).
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CONCLUSIONS
Company which does not have in management system will get problem when check.
There are very much important to produce Finished Goods (FG) at a right time because if the
Finished Goods(FG) are not produce at a right time then there will be a shortage of stock at
retailer shop. Then the retailer doesn’t satisfy to your service. Then the profit showing very
less. It’s totally depends upon the management system. If the management teams don’t give
the raw material at a perfect time then the production teams don’t produce the Finished
Goods (FG) at the right time.
There is a linkage between the Finished Goods (FG), demand and inventories of Raw
material Packaging Material (RMPM) and spares and other which required for day to day
smooth operation of a organization. They all are related to each other. If there is no Raw
Material (RM) then there is no Finished Goods (FG). If the machines are not in good
conditions then the production will be stop. Then the Finished Goods (FG) are not produce at
the right time.
Now the company use QAD software but very soon sifted to the SAP software
because to improve their inventory system. It also enhances the strength of the company. I
found the management should be very much perfect and the teams do his work in a proper
way. My heart full gratitude to the staff and employees of Hindustan Coca-Cola Beverages
Pvt. Ltd (HCCBPL) to co-operate with me throughout my internship period.
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SUGGESTIONS
Inventory management system is the best choice for replacing the current system. The
current system which is used in cola system by using inventory management system
transaction and any other thing will run more efficient and effective with any data loss. Form
run group point of view inventory management system should be implemented not for this
but also the others and e-scan will be used in office fact deal with warehousing like cargo,
container, factory etc.
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ANNEXURE
Questionnaire
INVENTORY MANAGEEMNT & CONTROL SYSTEM
Respected Sir/Madam,
I am Sonali Ray doing my project work on the topic “Inventory Management &
Control System in Coca Cola” under the guidance of Mr. B.N. Mohapatra, G.M. (HR)
your impartial opinions shall be kept confidential.
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8) Does internal control appear adequate for the inventory system overall?
Ans. (a) Yes (b) No (c) Can’t Say
9) Does your department prepare an annual financial report? Are managers hold
accountable for financial performance?
Ans. (a) Yes (b) No (c) Can’t Say
10) Has the department established cross-training or contingency plans for
significant changes in personal?
Ans. (a) Yes (b) No (c) Can’t Say
11) Does your department maintain any confidential employee/student and human
subject research records that requires special treatment for privacy protection?
Ans. (a) Yes (b) No (c) Can’t Say
12) Have employees been trained for workplace safety by the Environmental Health
& safety officer (EH&C) to comply with the appropriate regular for
requirements for their job responsibilities?
Ans. (a) Yes (b) No (c) Can’t Say
13) Do you believe that department personal are sufficiently informed about
important federal and state laws and regulations that govern activities performed
within your department?
Ans. (a) Yes (b) No (c) Can’t Say
14) Are the internal employee co-ordinate you for doing your survey?60/30/10
Ans. (a) Yes (b) No (c) Can’t Say
15) Are you satisfied the entire inventory process and control system of Coca-Cola?
80/10/10
Ans. (a) Yes (b) No (c) Can’t Say
Thanking you.
Sonali Ray
Deptt. of MBA
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