COST AND MANAGEMENT ACCOUNTING

PROJECT ON LIJJAT PAPAD

TEAM MEMBERS
Name Roll no. Specialization
Asavari A. Sabale 166 Operations
Siddhali 177 Human Resource

Table of Contents
INTRODUCTION...........................................................................................................................................1
HISTORY.......................................................................................................................................................2
PROCESS AND PRODUCT COSTING..............................................................................................................2
DISTRIBUTION FLOWCHART OF LIJJAT PAPAD.............................................................................................5
SUPPLY CHAIN MANAGEMENT....................................................................................................................6
LABOUR UTILIZATION..................................................................................................................................7

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INTRODUCTION
Lijjat Papad is a popular Indian snack made from lentil flour, typically seasoned with
spices like cumin, black pepper, and salt. It's rolled into thin discs and sun-dried or deep-fried
until crisp. Lijjat Papad is enjoyed as a crunchy accompaniment to meals or as a standalone

snack.

HISTORY
The history of Lijjat Papad traces back to ancient India, where the tradition of making
papads from lentil flour and spices originated. In 1959, seven Gujarati women living in the
Girgaum locality of Mumbai came together and took over a loss-making papad venture. They
had borrowed Rs 80 (their only seed capital) from renowned social worker Chhaganlal Karamsi
Parekh and began production from the roof of their buildings. They started with four packets of
papad and started selling them to known merchants in the locality. Through word of mouth, their
business expanded and soon, they upgraded to a cooperative system. In the first year, their sales
were Rs.6196. In 1962, the name Lijjat was chosen for the group, and in July 1966, Shri Mahila
Griha Udyog Lijjat Papad was registered as a society under the Societies Registration Act of
1860.
Papads have been part of Indian cuisine for centuries, with various regional variations
emerging over time. While the specific origins of Lijjat Papad are not well-documented, it likely
evolved from traditional papad recipes, incorporating different spice blends and preparation
methods to create its unique flavour profile. Over the years, Lijjat Papad has become a staple in

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Indian households and is enjoyed across the country for its delicious taste and crispy texture,
embodying the rich culinary heritage of India.
Lijjat Papad's journey can be traced to the rich culinary tapestry of India. Originating
from the ancient practice of making papads, Lijjat Papad likely emerged as a variation in
response to regional preferences and ingredient availability. The name "Lijjat" itself conveys the
idea of flavour and enjoyment in Urdu. Over time, artisans and home cooks experimented with
different spice blends, incorporating ingredients like cumin, black pepper, and various herbs to
enhance the taste.

PROCESS AND PRODUCT COSTING

Major raw materials are mentioned below:
 Urad Dal Flour
 Salt
 Edible oil
 Mix Spices (Chili, Cumin, Garlic, Black pepper)
 Baking Soda
S.N. Particulars Rate (Approx.)
1 Urad Dal Flour Rs 60-80/Kg
2 Salt Rs 10-12/kg
3 Edible Oil Rs 100-120/Litre
4 Mix Spices Rs 120-150/kg
5 Baking Soda Rs 30-40/kg
Average raw material cost per 1 kg packet: Rs. 60-70.
Process flow chart
 Raw Material Procurement: Raw materials should be received & stored in hygienic
condition. The quality of the raw material should be checked carefully.
 Adequate quantity of water is added in flour of Urad dal, common salt, spices and sodium
bicarbonate and homogenous mixing is done to obtain dough.

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  After about 30 minutes, small balls weighing around 7-8 grams of dough are made. These
balls are then placed in papad making machine or papad press wherein these balls are
pressed and circular papads are made as per the size of mould.
 These papads are then sun-dried but in this note drier with trolley is used as sun drying may
not be always feasible for industries.
 Lot of 25 or 50 papads is then packed in polythene bags.

Procurement Grinding & Papad

of raw Kneading Drying Packaging
material Mixing Making

Wages
Particulars Wages Rs. Per day
Plant Operator 560
Supervisor 640
Skilled 480
Unskilled 360
Total wages 2040
Only 1 worker is considered here, and wages are calculated.
Machinery
Machine Unit Rate (Rs.) Price (Rs.)
Pulverizer 1 90000 90000
Dough Kneading Machine 1 55000 55000

Papad Making Machine 1 220000 220000

Tray Drier 1 100000 100000
Packaging Machine 1 160000 160000
Material handling and other equipments - 200000 200000
(Bins, trolley, weighing machine, etc.)
Total Machinery cost 825000

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DISTRIBUTION FLOWCHART OF LIJJAT PAPAD

Expanded Ventures

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A flour processing division at Vashi, Mumbai
A Masala processing division in Cotton green, Mumbai
A Quality Control Laboratory in Cotton green, Mumbai
Printing division in Vashi, Cotton green
An Advertising unit at Bandra, Mumbai

SUPPLY CHAIN MANAGEMENT

Traditional Process for Papad Production
 Raw Material Sourcing: Traditional papad production relies on sourcing ingredients
such as black gram flour from local markets or directly from suppliers.
 Production Process: Women across India hand-knead and roll the dough into thin
wafers, followed by seasoning and drying under the sun. This communal activity reflects
the decentralized nature of production.
 Quality Control: Quality checks are integrated into the production process, with only
well-made flour being used, and below-par papads being distributed locally instead of
being sold.
 Distribution Network: Initially, papads were stored on a nearby terrace, but as
production expanded, a decentralized system emerged where women took the dough
home for further processing, leading to improved efficiency.
 Inventory Management: Traditional production methods often involve just-in-time
production, where papads are made to order, reducing the need for extensive inventory
management.
Modern Process for Papad Production
 Raw Material Sourcing: The central office purchases and distributes all ingredients to
maintain the quality of the final product. For example, the urad dal is imported from
Myanmar, asafoetida is imported from Afghanistan, and black pepper comes from
Kerala.
 Production Process: While the core process remains similar, modern facilities may
utilize machinery for kneading, rolling, and drying, enhancing efficiency and scale.
 Quality Control: The quality of papads can vary due to quality of water used in various
parts of India. To avoid any inconsistencies, the final products are tested in the Lijjat's

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 laboratory in Mumbai. In the monthly meetings, the quality issue and modifications are
tested. The committee often makes surprise visits to various branches to assure that
production conditions are hygienic.
 Distribution Network: Modern facilities may have centralized distribution centres and
utilize advanced logistics systems for efficient delivery to local, national, and
international markets. Lijjat Papad Business is spread in 82 branches in 17 states of India.
Lijjat Papad currently exports its products with the help of Merchant Exporters. They
export their products to 25+ countries including United States, United Kingdom, France,
Germany, Italy, Middle Eastern countries, Thailand, Singapore, Hongkong (China),
Netherlands, Japan, Canada, Australia, South Africa, and many other Countries.
 Inventory Management: Computerized inventory management systems track raw
materials and finished goods, optimizing inventory levels and reducing wastage.

LABOUR UTILIZATION
The labour utilization for making Lijjat papad, a popular Indian snack, involves several steps
mentioned above such as dough preparation, rolling, cutting, drying, and packaging. The specific
labour utilization can vary based on factors like the scale of production, automation level, and
efficiency of the workforce.
The labour utilization for manufacturing Lijjat papad typically involves several stages, each
requiring different levels of manpower and skill.
1. Dough Preparation: This stage involves mixing ingredients such as flour, spices, and water
to form a smooth dough. Labor is required to measure and mix the ingredients, ensuring the
consistency and quality of the dough.
2. Rolling and Cutting: The prepared dough is then rolled out into thin sheets and cut into
desired shapes, often using traditional rolling pins and cutters. Skilled labourers are needed
to ensure uniform thickness and shape of the papads.
3. Drying: The cut papads are laid out to dry either under the sun or in drying chambers. Labor
is required to arrange the papads for drying, flip them periodically, and monitor the drying
process to prevent over-drying or burning.

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4. Packaging: Once dried, the papads are packaged into suitable containers for distribution.
Labour is needed to pack the papads efficiently, seal the packages, and label them with
necessary information such as expiry dates and ingredients.
5. The exact labour utilization can vary depending on factors such as the scale of production,
automation level, and workforce efficiency. Larger-scale operations incorporate machinery
for certain tasks, reducing the need for manual labour. However, skilled workers are still
essential for maintaining quality standards and overseeing the production process.

Customer Relationship Management (CRM) in Lijjat Papad, a well-known Indian cooperative

involved in the manufacturing of papad and other food products, likely involves several key
aspects:
 Customer Feedback and Satisfaction: Lijjat Papad may actively seek feedback from
customers through various channels such as surveys, social media, or direct interactions.
They would use this feedback to improve their products and services to better meet customer
needs and enhance satisfaction.
 Personalized Communication: Lijjat Papad may use CRM systems to segment their customer
base and personalize communication based on factors such as purchase history, preferences,
and demographics. This could include targeted email campaigns, promotions, or special
offers tailored to specific customer groups.
 Order Management: Efficient order management is crucial for maintaining good customer
relationships. Lijjat Papad likely utilizes CRM systems to track orders, manage inventory,
and ensure timely delivery to customers.
 Customer Support: Providing excellent customer support is essential for retaining customers.
Lijjat Papad may have dedicated customer service teams to address inquiries, resolve issues,
and provide assistance to customers in a timely and professional manner.
 Community Engagement: As a cooperative, Lijjat Papad may also focus on building strong
relationships within the community. They may engage in community events, sponsorships,
or social initiatives to connect with customers and demonstrate their commitment to social
responsibility.
 Overall, CRM in Lijjat Papad plays a crucial role in managing customer interactions,
fostering loyalty, and driving business growth.