Supply Chain

Management

Logistics Practices of Tata Chemical

Submitted by
UM20320- Abhishek Ratha
UM20321- Ashutosh Patnaik
UM20328- B. Vishal Subudhi
UM20344- Priyam Das
UM20357- Srujan Deep Mishra
UM20366- Supratik Biswal
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Tata Chemicals Limited is a Science-led chemistry solutions Financial Highlights

company and is a part of the Tata Group.
The Chemical industry in India is
With US$ 106 billion turnover, the Tata Group operates in more expected to grow at 9.3% per
than 100 countries across six continents annum to reach USD 304 Billion by
FY 2025.
Develop science-led innovative products and solutions
The consolidated revenue for the
Develop technologies to provide nutrition solutions for human & year was Rs. 10,200 crore, EBITDA
animal health and agricultural solutions to improve farm yield and Rs. 1,501 crore and PAT Rs. 436
income. crore.
The largest saltworks in Asia, and are the 3rd largest soda ash Our focus was on ensuring robust
manufacturer and the 6th largest sodium bicarbonate cash flows from operations which
manufacturer in the world. were Rs. 2,037 crore on a
consolidated basis
Operates through two verticals - Basic Chemistry and Specialty
Chemistry.
Company Overview Challenges Logistics Elements
Product Portfolio
Basic Chemistry
Offers inorganic chemistry solutions
that serve the world’s leading
downstream brands
Alkali products: Soda Ash, Sodium
Bicarbonate, Caustic Soda, Crushed
Refined Soda
Halogen products: Chlorine-based
products, Bromine-based products
Salt products: Industrial Salt,
Livestock Salt, Animal Salt, Gypsum
Sustainable Efforts KPIs
Speciality Chemistry
Agro Sciences: Offers crop
protection and Agri-input solutions.
Nutritional Sciences: Innovative
range of nutritional solutions,
prebiotics and healthier alternatives
to regular sugar for consumers.
Material Sciences: Highly Dispersible
Silica and other grades of
Precipitated Silica and silica
dispersion
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Value Chain
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Challenges in the Chemical Industry

The chemical industry being highly volatile requires the players in this sector to evolve and adapt
themselves to the changing market conditions constantly. Tengwa Africa is one
logistics service provider to
The main challenges: Tata Chemicals and helps in
1. Outsourcing of logistics suppliers to the chemical Industry • Trade flow management
between customers and
2. Lack of security in stock and cargo transportations suppliers
• Improved efficiency due
to collaborative
relationships
• Export solutions for
specific logistics
requirements
Tengwa truck loading
For
TATA Chemicals out of
3. Complications in delivery logistics
Durban Port.
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Transportation
• The packaged goods are transported to the Mumbai Warehouse by the means of Land as
well as Rail route
• Similar model is applied all across the country except Cochin and for Export market. For
Cochin and Export market Sea route is used. • Road Transport is the preferred means for
transportation of the products to Mumbai
• It generally takes 1 – 1½ days for transportation from Mithapur to Mumbai
• TATA Chemicals has entered into agreement with various Transport Associations, e.g.
Gujarat Truck Association, etc.
• A single 3 rd Party Logistics Service provider cannot handle the complete load of both Soda
Ash and TATA Salt.
• The loading is done generally 50 – 50 i.e. 50% Soda Ash and 50% Salt.
• This is done to achieve proper weight balance and maximum space utilization.
They have also implemented Transporation Management System to improve their supply
chain efficiency.
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Warehousing
• 2 main Warehouse’s in Mumbai namely at Taloja and at Boisar
• The Temperature of the Warehouse is maintained around 30 - 35 ˚C to avoid humidity and moisture exposure to
Soda Ash and Salt
• Soda ash tends to cake when exposed to moisture or the atmosphere for a long time
• FIFO method is used inventory control
• Quantity Committed Customers i.e., Contract for delivery of fixed number of products all throughout the year
• Warehouse closer to the Warehouse of the Buyer Company.
• For e.g., TATA Chemicals has a Warehouse established near the Warehouse of Unilever and St. Gobain
• For e.g., if Unilever has Quantity Set Contract with TATA Chemicals for the supply of 100 metric tones/day of Soda
Ash then TATA Chemical carries an inventory of 1800 – 2000 metric tone
• At Central Warehouse 10 – 15-day inventory in the form of onsite storage as insurance against delivery delays
• Limited access to SAP is provided at Warehouse level
• The employees at the Warehouse are provided with special PDA’s
• PDAs are connected to the online system of the company; the whole data automatically gets transferred for the
Warehouse to the SAP at the Central office situated at Mumbai
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Distribution
• TATA Salt as mentioned above is further transported to various Depots, Wholesalers, and Retailers across the state from the
Central Warehouse
• The Transportation for the distribution process is carried out by the concerned Transport Association
• It is normally done by the Road Transport only
• EX WORKS Contract Deliver goods at his or her own place of business. All other transportation costs and risks are assumed
by the buyer
• OTF Customers
➢ Checks the available quantity at the central Warehouse. If the quantity available at the Central Warehouse is enough to
meet the needs of Quantity Set Customers as well as OTF Customers then the distribution is done to the OTF Customers
➢ Delivery can take up to 7 – 10 days
• Export customer’s
➢ Distribution is done through the Sea route
➢ It is carried out through the port of Kandla which is closer to the plant location of Mithapur
➢ Same is done for Cochin
➢ Since for distribution various Transport Associations are involved TATA Chemicals has better control over the cost factor
involved in the Distribution process
➢ Cost involved in the Owning and Maintaining of vehicles for distribution is also eliminated
➢ Change in the daily shipment of the quantity fixed, is carried out by sending a mail to the company head office at Mumbai
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Sustainable Practices
Recycling of Lithium Ion batteries
• By 2030 it is expected that, 50% of the new vehicles sold will be electric.
• Limited resources would strain up the whole supply chain of lithium-ion batteries.
• In 2018, 56% of lithium produced is used in battery making.
• Transportation of lithium-ion batteries involves certain risk, as the electrolyte is inflammable.

Tata Chemicals has adopted circular economy

Advantages for logistics:
Reduces cost as dependency on
sourcing reduces.
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Stepping into Green Supply Chain

Green supply strategy for Soda Ash:
• Soda Ash usually transported
in loose conditions in several
plastic bags and plastic
packaging
• German Patented, LUPA Bulkers are
vessels designed to carry unpacked
cargos(Soda ash in this case) in the most
cost effective and eco-friendly manner
• Each Bulker has the capacity to
• Cargos are loaded and unloaded through
replace 3 million plastic bags/year
air pressure
• Helps reduce carbon footprint by up to
• With pressurized discharge leading to no
20 % and use of plastics to transport
possibility of contamination, it becomes
the loose soda ash which earlier used
one of the most cost effective- economical
to be transported via plastics
option
Company Overview Challenges Logistics Elements Sustainable Efforts KPIs

Cash-to-cash Time Cycle

Cash to cash cycle

DOI+DOR+DOP=146.67

Days of Inventory Days of Receivable Days of Payable

No. of days in the period/Inventory Average receivable/Total credit Accounts Payable X Number of
turnover ratio sales*No of days in that Days / Cost of Goods Sold (COGS)
=360/5.75=62.60 period=144.92/2984*360=17.48 =481.65*360/2604.33=66.58

Freight Bill accuracy

(error-free freight bills / total freight bills) * 100

393.23 / 423.98 * 100 = 92.78%
Thank you