INTRODUCTION

Plastic is crucial to the development of any modem economy and is considered to the backbone
of human civilization. The level of per capita consumption of plastic is treated as an important
index of the level of socioeconomic development and living standards of the people in any
country. Today's plastics are one of the most used materials on a volume basis in U.S.
industrial and commercial life. Plastics are broadly integrated into today's lifestyle and make
a major, irreplaceable contribution to virtually all product areas. Although the plastics
industry in the United States is now in its second century, the most important developments
have occurred since
1910. A plastic material is any of a wide range of synthetic or semi-synthetic organic solids
that
are moldable. Plastics are typically organic polymers of high molecular mass, but they often
contain other substances.
Plastic industry also called 'sunrise industry 'is a postwar phenomenon in the country. They
are usually synthetic, most commonly derived from petrochemicals,but many are partially
natural. All major industrial economies are characterizedby the existence of a strong plastic
industry and the growth of many of these economies has been largely shaped by the strength
of their plastic industries in their initial stages of development.The new plants have also
brought about a greater regional dispersion easing the domestic supply position notably in the
western region. At the same time the domestic plastic industry faces new challenges.Plastic
industry besides facing the shortage of raw material and completion from abroad is
facing stiff opposition from environmentalists.
This needs a comprehensive "public educationcampaign"and waste recycling policy to tide
over the situation. It involves the molding and fabrication of plastic goods using polymer.
These goods are manufactured both by big companies like Flex industries and sharp etc. as
well as by small scale enterprises. Manufactured products include packaging, household
goods, building and construction material, industrial goods and agricultural material. The first
man made plastic was created by Alexander parks who publicly demonstrated it at the 1862
Great International Exhibition in London. The material called Parke sine was an organic
material derived from cellulose that once heated could be molded, and retained its shape when
cooled.

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HISTORY OF PLASTIC
The word plastic comes from the Greek verb plassein, which means "to mold or shape." Plastics
have that capacity to be shaped thanks to their structure, those long, flexing chains of atoms or
small molecules bonded in a repeating pattern into one gloriously gigantic molecule. "Have you
ever seen a polypropylene molecule?" a plastics enthusiast once asked me. "It's one of the most
beautiful things you've ever. It's like looking at a cathedral that goes on and on for miles."
Indian plastic industry has made significant achievements in the country ever since it made a
promising beginning with the start of production of polystyrene in 1957. The industry is growing
at a rapid pace and the per capita consumption of plastics in the country has increased several
times as compared to the earlier decade. The chronology of production of polymers is
summarized as under

1957 - Polystyrene

1959 - LDPE

1961 - PVC

1968 - HDPE

1978 - Polypropylene

Currently, the Indian plastic industry is highly fragmented with an estimate of around 25,000
firms and over 400,000 employees. The top 100 players of Indian plastic industry account for
just 20% of the industry turnover. Barring 10 to 15% of the firms that can be categorized as
medium scale enterprises, most of the units operate on a small - scale basis.
The immense potential of Indian plastic industry has motivated Indian manufacturers to acquire
technical expertise, achieve superior quality standards and build capacities in different facets

of

the booming plastic industry. Substantial developments in the plastic machinery sector coupled
with matching developments in the petrochemical sector, both of which support the plastic
processing industry, have facilitated the plastic processors to develop capacities to cater both the
domestic as well as overseas exports. In 1600 Be, Mesoamericans used natural rubber for balls,
bands, and figurines. Early plastics were bio-derived materials such as egg and blood proteins,

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which are organic polymers. Treated cattle horns were used as windows for lanterns in the
middle ages. Materials that mimicked the properties of horns were developed by treating milk
proteins (casein) with lye. In the 1800s, the development of plastics accelerated with Charles
Goodyear's discovery of vulcanization as a route to thermo set materials derived from natural
rubber. Many storied materials were reported as industrial chemistry was developed in the 1800s.
In the early 1900s, Bakelite, the first fully synthetic thermo set was reported by Belgian
chemist Leo Baekeland. In 1933, polyethylene was discovered by Imperial Chemical Industries
(ICI) researchers Reginald Gibson and Eric Fawcett. After the First World War, improvements in
chemical technology led to an explosion in new forms of plastics; mass production began around
the 1940s and 19508. Polypropylene was found in 1954 by" Giulio Natta" and began to be
manufactured

in 1957. Among the earliest examples in the wave of new polymers

were polystyrene (PS), first produced by BASF in the 1930s, and polyvinyl chloride (PVC), first
created in 1872 but commercially produced in the late 1920s. In 1954, expanded polystyrene
(used for building insulation, packaging, and cups) was invented by Dow Chemical.
Polyethylene terephthalate (PET)'s discovery is credited to employees of the Calico Printers'
Association in the UK in 1941; it was licensed to DuPont for the USA and ICI otherwise, and as
one of the few plastics appropriate as a replacement for glass in many circumstances, resulting in
widespread use for bottles in Europe. The development of plastics has come from the use of
natural plastic materials (e.g. chewing, shellac) to the use of chemically modified natural
materials (e.g., rubber, nitrocellulose, collagen, galalite) and finally to completely synthetic
molecules (e.g., Bakelite, epoxy, Polyvinyl chloride).
In the post-World War II world, where lab-synthesized plastics have virtually defined a way of
life, we've come to think of plastics as unnatural, yet nature has been knitting polymers since the
beginning of life. Every living organism contains these molecular daisy chains. The cellulose
that makes up the cell walls in plants is a polymer. So are the proteins that make up our muscles
and our skin and the long spiraling ladders that hold our genetic destiny, DNA. Whether a
polymer is natural or synthetic, chances are its backbone is composed of carbon, a strong, stable,
glad-handling atom that is ideally suited to forming molecular bonds. Other elements -typically
oxygen, nitrogen, and hydrogen-frequently join that carbon spine, and the choice and
arrangement of those atoms produces specific varieties of polymers, bring chlorine into that

molecular conga line, and you can get polyvinyl chloride, otherwise known as vinyl; tag on
fluorine, and you can wind up with that slick nonstick material Teflon.
Plastic industry also called as "sunrise industry" is a postwar phenomenon in the country. It is a
rapidly growing industry. It offers lucrative employment opportunities for skilled labor. In 1992
the industry employed about 80,000 skilled technicians. The total investment in the processing
industry in 1991 was estimated at Rs.l, 000 cores. This is expected to grow to Rs, 4,500 cores
by
2,000 AD certainly; discovered in 1851, was the first thermosetting material to be prepared and
the first material that involved a distinct chemical modification of a natural material. But ebonite
was not exploited commercially for some years after its discovery; for that reason, its historical
importance has become somewhat blurred.
Owing to its easy molding, non-corrosive and moisture-resistant qualities plastics have a variety
of uses in packaging industry, manufacture of household goods, building and construction
materials, industrial goods, agricultural goods, electrical accessories, imitation jewelers etc. The
plastic industry has two distinct phases: (l) production of raw materials, and (2) molding and
fabrication of plastic goods. One can go as far back as the Old Testament to find references about
natural material used as fillers, adhesives, coatings, and the like. These materials were the
precursors of modem plastic materials. Historians continue to differ as to the exact year or
decade that the plastics industry began because the definition of "plastic" is a matter of
interpretation.

Parkesine
The plastic material parke sine was patented by Alexander Parkes. In Birmingham,UK in 1856.
It was unveiled at the 1862 Great International Exhibition in London Parkesine won a
bronze medal at the 1862 World's fair in London. Parkesine was made from cellulose (the
major component of plant cell walls) treated with nitric acid as a solvent. The output of the
process (commonly known as cellulose nitrate or pyroxilin) could be dissolved in alcohol and
hardened into a transparent and elastic material that could be molded when heated. By
incorporating
pigments into the product, it could be made to resemble ivory.

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Bakelite
The first plastic based on a synthetic polymer was made from phenol and formaldehyde, with the
first viable and cheap synthesis methods invented in 1907, by Leo Hendrik Baekeland,
a Belgian-born American living in New York state. Baekeland was looking for an insulating
shellac to coat wires in electric motors and generators. He found that combining phenol
(C6HsOH) and formaldehyde (HCOH) formed a sticky mass and later found that the material
could be mixed with wood flour, asbestos, or slate dust to create strong and fire resistant
"composite" materials. The new material tended to foam during synthesis, requiring that
Baekeland build pressure vessels to force out the bubbles and provide a smooth, uniform
product, as he announced in 1909, in a meeting of the American Chemical Society. Bakelite was
originally used for electrical and mechanical parts, coming into widespread use in consumer
goods and jewelry in the 1920s. Bakelite was a purely synthetic material, not derived from living
matter. It was also an early thermosetting plastic.

THE GLOBAL PLASTIC INDUSTRY

The period 1930-1940 saw the initial commercial development oftoday's major thermoplastics:
polyvinyl chloride, low density polyethylene, polystyrene, and polyethylene. The advent of
World War II in 1939 brought plastics into great demand, largely as substitutes for materials in
short supply, such as natural rubber. In the United States, crash program leading to large-scale
production of synthetic rubbers resulted in extensive research into the chemistry of polymer
formation and, eventually, to the development of more plastic materials. As on the latest
published result of February 2014, the global economy presents its own set of opportunities and
threats for businesses in a range of industries. IBIS World's Global Plastic Product & Packaging
Manufacturing global market research report offers insightful industry analysis and research into
the market at an international level. IBIS World's in-depth industry market research is presented
in a logical and consistent format. The industry report contains key industry statistics, market
size, industry trends, and growth and profit forecasts for a 5-year outlook period.
Historically, North America and Europe have been the largest plastic product manufacturing
regions of the world. This is not surprising given the productivity of the regions, which generally
results in high levels of consumption expenditure. However, over the past 10 to 15 years, these

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two regions have lost some of their share of the global market. Strong competition from
emerging economies, mainly China, has resulted in more and more companies closing shop in
the US, Europe and Canada. At the same time, major global companies from the Western world
have ramped up foreign investment in China and other developing nations, taking advantage of
cheap production costs associated with labor and raw materials.

PLASTIC INDUSTRY IN INDIA

The Indian plastics industry made a promising beginning in 1957 with the production of
polystyrene. Thereafter, significant progress has been made and the industry has grown
and diversified

rapidly. Currently, the Indian plastics industry is spread across

the country, employing about 4 million people and over 2,000 exporters. It operates more
than 30,000 processing units, of which 85 per cent to 90 per cent are small and medium
enterprises (SMEs).
The Indian plastic industry has taken great strides. In the last few decades, the industry has
grown to the status of a leading sector in the country with a sizable base. The material is
gaining notable importance in different spheres of activity and the per capita consumption is
increasing at a fast pace. Continuous advancements

and developments

in polymer

technology, processing machineries, expertise, and cost effective manufacturing is fast

replacing the typical materials in different segments with plastics.
On the basis of value added, share of India's plastic products industry is about 0.5% of
India's GDP, the export of plastic products also yield about 1% of the country's exports. The
sector has a large presence of small scale companies in the industry, which account for
more than 50% turnover of the industry and provides employment to an estimate of about 0.4
million people in the country. Approximately Rs 100 billion are invested in the form of fixed
assets in the plastic processing industry.
Steady Growth in Exports
India is one of the most promising exporters of plastics among developing countries. The
Indian plastics industry produces and exports a wide range of raw materials, plastic molded
extruded goods, polyester films, laminates, molded! soft luggage items, writing instruments,
plastic woven

111

sacks and bags, PVC leather cloth and sheeting, packaging, consumer goods, sanitary fittings,
electrical accessories, laboratory/ medical surgical ware and travel ware, among other products.

Key Markets and Export Destinations

In 2011-12, exports of Indian plastics stood at US$ 7.19 billion, registering a growth of
approximately 47 per cent over the previous year
Indian plastics exports have grown at a rate of 19.9 per cent since 2007-08
Products from the Indian plastics industry are exported to more than 150 countries ;major
trading partners being China, the US, the UAE, Turkey, Italy, the UK, Indonesia,
Germany, Vietnam, Bangladesh, Nigeria, Pakistan, South Africa, Brazil, Singapore,
Saudi Arabia, Nepal, Egypt, Sri Lanka and the Netherlands

Plastics Export Promotion Council

The Plastics Export Promotion Council (PLEXCONCIL) is the apex government body for the
promotion of exports by the Indian plastics industry. The members of the council comprise
large/medium/small-scale manufacturers and exporters. It facilitates exporters through various
export promotion activities such as participating in international trade fairs, exploring newer
markets, organizing buyer seller meets both in India and overseas, and other need based
activities.
The potentiality of plastic industry in India propels other associated industries to grow side by
side. One of such growing industry is petrochemical industry. Both these industries are
reciprocal to each other. The petrochemical industry facilitates the plastic industry to produce
plastic products that will meet the domestic demand as well as that of the overseas market. The
plastic raw material consumption in India during 1990 was a little over nine lakh tones which
exceeded 1.5 million tons by 1995. By 2,000 AD, the demand is likely to exceed 2.5 million.
In spite of the rapid growth of the petrochemicals industry in recent years, the demand-supply
gap is likely to exceed a million tons by 2005.Between 1990-2000 an investment of about
$10,400 million has been made in setting up new petro-chemical complexes, Of these two
complexes at Ngotwane (Maharashtra) and Hazira (Gujarat) have already been commissioned.
Nine more at Auraiya, Vishakapattanam, Gandhar, Haldia and Mharashtra are nearing
completion.

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India imports plastic polymers from West European countries, Japan and the United States. It
also exports plastic goods to neighboring Asian and African countries. Our main competitors are
China, Thailand, Indonesia, Korea and Malaysia. The overall turnover of the plastics processing
industry that currently stands at

Rs. 85,000 core is expected to touch Rs. 100,000 core in the year

2012 on the basis of the expected growth of the demand potential to 12.50 MMT from the
current 9 MMT. The number of processing units from the current 30,000 is expected to increased
to 40,000, 330/0growth which will in-turn also increase the employment potential of the sector.
Independent studies show that the industry that currently hires more than 3 million people,
directly and indirectly, is expected to employ close to 4 million people in 2012 and 7 million
people by the year 2015. The government of India is trying to set up the economic reforms to
elevate and boost the plastic industry by joint venturing, foreign investments.

DEMAND AND SUPPLY OF PLASTICS IN INDIA

The plastic industry of India has a big market potentiality and is gradually prospering. This
potentiality of the market will surely actuate the entrepreneurs to invest in this industry.
Entrepreneurs are trying to provide high quality plastic products, so that it becomes a booming
industry. The new materials began to compete with the older plastics and even with the more
traditional materials such as wood, paper, metal, glass, and leather. The introduction of alloys
and blends of various polymers made it possible to tailor properties to fit certain performance
requirements that a single resin could not provide.
The demand for plastics has increased steadily; plastics are now accepted by designers and
engineers as basic materials along with the more traditional materials. The automotive industry,
for instance, relies on plastics to reduce weight and thus increase energy efficiency. The growth
of the plastics industry has seen the number of processing units grow from 25,000 in the year to
2010 to 30,000 units in 2011. The exponential growth anticipated over the next three years will
see this number go up to 40,000 units. As of today, just about 10% to 15% of these units can be
classified as medium scale operations and the rest all operate on a small scale basis. Over 70% of
the industry is in the unorganized sector.

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FUTURE FORECAST
The Indian plastic industry clearly has the potential to continue its fast growth. However, over
the next few years, competition in the industry is expected to increase considerably, as a result of
global trends, which will become applicable to the liberalizing economy of country.
To survive the competition, both polymer manufacturers and processors will need to adopt
radically new methods and approaches to reduce costs, improve market and customer service
and management of performance.
The per capita consumption of plastics in India is well below the world average. However it also
reflects the many years of growth ahead, as the country's economy continues to grow and
upgrade the usage of products. Translating the expected growth rate into incremental demand, it
is obvious that the country will remain one of the largest sources of additional demand for almost
all kinds of plastics.
Hence, it is clear that plastics will continue to be a growth industry, with boosting prospects for
fresh investments in polymerization and downstream processing capacity. This is in contrast to
the situation in various other countries, where growth prospects are limited, either because of
stagnant demand or due to the historical over building. In such countries, the overall outlook
would be far less promising, with the key imperatives being cost cutting and capacity
rationalization.

BACKGROUND AND INCEPTION OF THE COMPANY

Gemini plastic is only a mini plastic industry in Kerala. It was established in the year 1987.
Gemini plastic is a private limited, partnership type of organization. The company is situated at
the industry Estate, Palayad, Thalassery. Sri .C. Govindhan was the founder of the finn. Sri
Remesh is the managing partner of firm and Sri. Srinivasan is the manager.
Gemini Plastic Industries was established by Late C. Govindan, a noted industrialist and
businessman in Thalassery. It was the blooming of a dream by a great entrepreneur and visionary
called C. Govindan. Thus, a SSI Unit was set up at Thalassery in 1987 with latest
Windsor injection moulding machines, state of the art infrastructure and technicians to
manufacture quality plastic household articles. In recognition of his spirit and excellence in
entrepreneurship, C. Govindan was conferred many awards - the Udyogpathra A ward by the
Institute of Industrial Development, New Delhi and Pride of India Award by Global Economic
Council, to name a few
Gemini Plastics have subsidiary firm called Lakshmi Engineering enterprise .. It is engaged
in manufacturing dyes and modules used in producing plastic product. The

company

produce59 different plastic item and is marketed with the trade name "Gemplast", The trade
mark is picture of a baby in the bucket. The firm itself handles production and marketing of
products. The firm started with an initial investment of Rs. 25 lakh. The financial source is the
partner itself. The machinery fund was borrowed as term loan from kerala
corporation.

The

financial

working capital borrowed from State Bank of India. The machines for

manufacturing purpose are bought from "Klocknor Windsor India Ltd, Bombay.
Gemini plastics is a small scale industrial unit (SSI unit) engaged in the manufacturing of
plastics household articles like buckets, mug, trays, basins, cycle baskets, heater jugs, waste
paper baskets, To make the operation viable and reduces the cost. The main departments of the
Gemini plastic are production, administration, sales department, account and finance department.
The firms have l~ distributors all over Kerala. Sale representative visit each area periodically
and meet customers. The firm has wide range of long and flat steel products are much in demand

in the domestic market. This vital responsibility carried out by own marketing department that
transact business through its network of 16 branch sales office spread across the four regions.

ADDRESS OF THE COMPANY

Gemini plastic Industries
Industrial Estate, P.O
Palayad, Kannur,
Phone: 0490 2346548
Email-gemplast_2007@rediffmail.com

NATURE OF BUSINESS CARRIED

Gemini plastic industry carries on manufacturing business which is concerned with the
compound mixing, melting and injecting process and thereby meeting demand and requirement
of the society. Living up to the demand of the growing economy of the country, the industry
produces wide range products. Commitment to quality and customer satisfaction has resulted in
consistent R&D efforts culminating in development and commercialization.

VISION, MISSION & QUALITY POLICY

Vision
The vision of the company is"To become a global player committed to international quality, standards, efficient pricing and
excellent after sales service."
The vision statement mean
1) To become a leading global player in the plastic industry
2) International quality standard means the products and services offered by Gemini plastics
will match with the quality offered by competing firms.
3) Efficient pricing which will compete with the price of competing firms.
4) Treat customer in the possible manner after sales.

.,..

Mission
The mission of the company is:
"To optimize the value like customer satisfaction, creating shareholder wealth through human
resource department."
The mission statement mean
I) Gemini Plastics aims to provide best product and service for the customer.
2) Create good relations with dealers.
3) Attaining cost effectiveness in all levels.

Quality policy
During refining samples are analyzed in the laboratory and the process is controlled according to
the batch sample analysis. Gemini plastic produced in the plant is every time subjected to
stringent and uncompromising quality control test. Quality control department has the
responsibility to control and maintain the quality of output and to grade it. The department has
full-fledged metallurgical laboratory to perform this task. During refining, the samples are
analyzed. The products of the company are every time subject to most stringent and
uncompromising quality control test. The stringent compliances to the prescribed code of
standards, Gemini plastic has over the years acquired a reputation for quality plastics.

PRODUCT PROFILE
Plastic making by melting various grades of good quality scrap, hot briquetted "High Density
Poly Ethylene" (HDPE) and inject the machine. After completion of injection process the mould
is cooled. The product formed by one by one. These products conform to the BIS standard code
ISO 90012008.
Company's products-details are as under.
Bucket
Basin
Cup diamond

47

Hand fan

Kitchen container

Magi bowl

Economy bucket

Cup super 1000

Office bowls

Waste paper basket

Water jugs

Soap boxes

Mugs

The plastic produced here is strictly conformed to BIS specification falling under high and low
density materials. The products offered by the Gemini plastic has always shown better quality
and durability irrespective of the changing environment outside the organization and also those
factors which affects the production form within the organization and it also sees to it that the all
the areas are strictly covered.

AREA OF OPERATION
A Gemini plastic is a local player in the plastic production in Kerala. The products are marketed
and distributed allover Kerala. There are 12 distributors in place like Calicut, Kasaragod, and
Kochi etc.

OWNERSHIP PATTERN
A Gemini plastic is a private limited, partnership type of organization. Sri Ramesh is the
managing partner of the company and other partner Sri Sunil Kumar. It is a private limited
company.

COMPETITOR'S INFORMATION
Main competitors of the company are Redson plastic, Red star plastics, Southern plastic.
Gemini plastic is competing with other in the plastic market with its in compatible reliability.

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Other main competitors

FAMILY PLASTICS
It is amongst the lowest cost plastic producers of Kerala and their vision is to become low
cost producer in the world in the future. Based on the flat form of low cost raw materials
and a modern plant, the company targets to produce plastic at low cost. The labor
productivity is still poor and in the absence of safety net, it is difficult to playoff
redundant labor.

CENTURY PLASTICS
It uses power from captive plant to achieve cost reduction. The company is planning of
installing a pallet plant for reducing cost of production and achieving economy of
operation besides continuous, uninterrupted supply of long term metallic needs. It has
introduced construct system of labor instead of permanent employees.

INFRASTRUCTURAL FACILITATES
Machinery
It is most important machinery used by the organization, the firm having 6 machineries.
The machine for manufacturing purpose bought from KLOCKNOR, WINDSOR INDIA
LTD,BOMBAY

Land and building

It is another important facility which helps the organization to perform its functions on a
day to day basis without any delay. The land covering about 3 acres and the building
which forms part of the manufacturing function adds to it.

Guest house
A guest house which helps in the accommodation and service of the people from outside
also forms part of the Gemini Plastic. It is well furnished and ready to use for any type of
personality at any point of time.

Canteen
Gemini Plastic is providing building for canteen, which is offering hygienic and tasty
food as per the orders of the staff and workers at a subsidized and lower rate.

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49

)1----------

 Restroom
Gemini Plastics also provides rest room facility for the employees with adequate
lighting and other facilitates necessary for giving 100% commitment and also
making the employee loyal to the organization.

R&D department
Gemini Plastic provides a separate section for carrying out the research and
development activities in the best possible manner. The research and development
activities are performed by perfect panel of members of the organization.

Transportation

and Communication

Efficient transportation and communication facilitates for ensuring the prompt delivery
of the products produced are being implemented in the organization which comprises
of vehicles and telecommunication system and internet.

ACHIEVEMENTSI

AWARDS

Gemini Plastic is one among the leading suppliers of plastic product to the Kerala state.
Gemini Plastic is in the midst of ambitious expansion plans. The major thrust of
modernization and expansion plans is to adopt best modern technology, which in
addition to being cost effective should also be energy effective and environmental
friendly.
Plastic industry has reached to greater capacity of producing 250 tons per annum.

WORK FLOW MODEL

Raw material
The first and the foremost step in any production process is the input of raw material. The raw
material must be of perfect quality otherwise we cannot produce quality product, hence
Gemini plastic is buying its raw materials from parts of the country which suits its
specification. Initially
,

raw material is loaded for processing by two sections: Manual section

Machine section

Figure 3.1 WORK FLOW MODEL

RAW MATERIAL

Lr-\f ._

I L

C_POR_OMC_EPSUSN_D_IN_G

r--V-\J

H_AN_D_L_IN_G_--I~l I... C_O_O_L_IN_G _

,I

M-E-L-T-IN-G----I

\JI

L.-

_IN_J_EC_T_IO_N_--,

PACKING

In manual section process are carried out manually. There is no usage of machinery for this
section. And in machine section it's done with the machineries.

Compounding
In this process the raw material mixed with color. After mixing the raw material will loaded in to
machine, in this process 6 colors are using. In this process mixture are loaded to the machinery
for further process. Loading is done without using machinery.

1. Melting
The compound mixture is heating & melting inside the machine. The mixture is heated
above 260 c to melt the mixture. This process is mainly done to convert the powdered
mixture in to liquid.

2. Injection
After the melting process inject the liquid form in to the molder. Different types of
molder are used for the production of different type of items.

3. Cooling
After the completion of injection process the mould is cooled by the cooler used in the

machine. Water is purified continuously on the hot mould until the mould gets cooled.

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51

4. Handling
After cooling of the material, it is taken out carefully from the moulds and putted in
different sections according to its category and putted forwarded for the next process.

5. Packing
After processing the goods are ready to distribute. But before distributing, the
products are packed in perfect packets & bundles. The products are packed before they
are sent to the finished goods stock. These plastic items are packed using plastic covers.
Plastic covers are tightly wrapped around the products. Bundles have 12 numbers & in 3
groups having 4 colors.

FUTURE GROWTH AND PROSPECTUS

Gemini plastic is very much concerned on the enhancement of the production capacity
by trying to provide it with the all the requirements.
Gemini plastic also focuses on increasing the market share by 5% by the end 2013.
Gemini plastic is now very keen on taking in world class technology and support
systems.
It also focuses on improving the products that is by improving the quality and durability
of the products produced.
Gemini plastic aims at providing mix or the proportion of the value added products.
As it a manufacturing company, it hies to implement enhanced pollution control
measures, with environmental conservation.
Gemini plastic aims at the reduction of wastage which forms part of the production
process.
Training to the employees in order to make them efficient enough to work under
different situations are expected to be imparted with in short span of time.
The company is aiming at increasing the number of products from the existing
production capacity.
Gemini plastic alms at employing corporate social responsibility for making the
organization committed to the society.

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SWOT ANALYSIS
INTRODUCTION
SWOT analysis is the key concept in the world of co-operative planning, strategy formulation
and other practical sphere of management. SWOT analysis is the tool for auditing an
organization and its environment. It is the first stage of planning and helps marketers to focus on
key issues. SWOT stands for strengths, weakness, opportunities and threats. Strength and
weakness are internal factors and opportunities and threats are external factors. SWOT analysis
is a strategic planning method used to evaluate the strengths and weaknesses. Opportunities and
threats involved in a project or in business venture. It involves specifying the objective of the
business venture or a project and identifying the internal and external factors that are favorable
and unfavorable to achieve that objective.
SWOT analysis is a strategic planning method used to evaluate the strengths, weakness,
opportunity and threats involved in business venture. Strengths and weaknesses are internal
factors. For example, strength could be management having good relation with employees.
Weakness could be lack of a marketing expertise. Opportunities and threats are external factors.
For example, an opportunity could be developing distribution channel such as internet, or
changing customer lifestyles that potentially increase for a company's products. A threat could
be a new competitor in an important existing market or a technological change that makes
existing products potentially outdated. Accordingly, SWOT analysis is best used as a guide and
not a prescription.
Adding and weighting criteria to each factor increases the validity of the analysis. The SWOT
analysis tool is great for developing and understanding an organization or situation and decision
making for all sorts of situations in business, organization and for individuals. The SWOT
analysis heading provide a good framework for reviewing strategy, position and direction of a
company, product, project or person. A SWOT analysis is a process to identify where you are
strong and vulnerable where you should defend and attack. The results of the process is a "plan
action".

STRENGTHS
The strengths of any organization lies in the different attributes that a firm carries with itself and
makes it a powerful standing in the market. Such attributes of Gemini plastics are discussed
below.
1) Today Gemini plastic is a well organized company with executives and other. Employees
have long years of experience in this company.
2) This is only in the plastic industry in Kannur district.
3) The company has efficient sales at work.
4) Gemini plastic is the only plastic industry

In

Kannur with more than 25 years of

experience in the production and marketing of plastic.

5) Employees are intelligent and are able to pick the necessary skills for running the
organization in a very efficient way. They have already developed the necessary skill and
willing to develop the same further.
6) Gemini plastics have a strong brand image among the dealers and customers.
7) It has an efficient and motivational sales force.
8) Gemini plastic has got certificate for the good industry level.

WEAKNESS
Weaknesses are attributes of the organization that are harmful to the achievement of the
objective. A weakness is opposing forces to a company unable it to achieve its goals and
objectives. There is a quote that there is no success without difficulties.
1) Unavailability of raw material required by the plant is only about 20% in Kerala itself,
may be another 10% available from Tamilnadu is possible at reasonably economic prices.
2) Gemini plastic is located very much from the town areas. Hence out the requirement of
refectories spares and such materials have to come from far away.
3) Transportation cost is increased for the procurement of raw material & sales of goods.
4) Employees are sensitive in reacting to their requirements being not squarely met by the
organization or for any delay in realizing their demands.

'\

5) Today Gemini plastics have to depend solely on electricity board for power, frequent
failures on the part ofKSEB.
6) Working capital shortage-being private ltd company finding working capital itself.

OPPURTUNITIES
Opportunities are external conditions that are helpful to the achievement of the objective.
Opportunities are the platforms where a firm can perform and archive its objectives and goals.
1) Fast progressing technology is available in India to improve efficiency of the
organization.
2) Gemini plastic is having a wider scope in catering to the masses in the rural areas.
3) Gemini plastic has go greater future in export of its products.
4) Gemini plastic can also plan for consolidations looking at its present conditions.

THREATS
Threats are external conditions that are harmful to the achievement of the objective. The
threats involved in context to the Gemini plastic are as follows.
1) Tight competition from family plastic which is having same strategy.
2) Unexpected power failure and restrictions in usage of power from the side of KSEB.
3) Competition from Lakshmi plant outside Kerala
4) Financial strain on the company due to fast increasing input costs and the necessity felt
to organize large stokes of raw materials
5) Unwanted interference of political sector
6) Emergence of other companies in to the industry
7) Competition from private dealer who has been supplying plastic product at a much
lower rate due to operational efficiency.

cc

1_

RATIO ANALYSIS
TABLE NO 5.1 INVENTORY TURNOVER RATIO

A VERACE STOCK OF

YEAR

SALES

2009-2010

13700000

1313302.5

1.04

2010-2011

17100000

]4225495

1.20

2011-2012

20500000

]5167302

1.35

2012-2013

23100000

15686858

1.47

2013-2014

26500000

17327075

1.52

INVENTORY

RATIO

CHART NO. 1
I~NTORYTURNOVER
2

1.5
1

.
,/'
;/

l1li

..

!I!!I!l
'_

II1II

..

0.5 V

RATIO

/~

.. ..

Inventory turnover ratio

..
till

iJ

~7

INTERPRETATION:
The Table no. 1 shows that inventory turnover ratio is different for different years. The Inventory
Turnover Ratio indicates the efficiency of the finn to manage its inventory. A high turnover ratio
indicates that the inventory is sold fast. A low turnover ratio reflects over investment in
inventories and accumulation of huge stock. A too high turnover of inventory may not always
imply a favorable situation. There is no standard ITR. It may be different for different firms

depending upon nature of industry and business conditions. It shows an increasing trend in ratio

which is good for the company.

TABLE NO.2 INVENTORY VELOCITY

INVENTORY
TURNOVER
RATIO

INVENTORY VELOCITY
PERIOD
(IN DAYS)

YEAR

DAYS

2009-2010

365

1044

346

2010-2011

365

1.20

300

2011-2012

365

1.35

266

2012-2013

365

1.47

244

2013-2014

365

1.52

236

CHART NO.2
INVENTORY VELOCITY
400
350
300
250
200
150
100
50

r-:"'-"""""_

I
.

I
I
I

~..

..

~INVENTORY
VELOCITY

1
...

INTERPRETATION:
The Table no.2 shows the inventory velocity in different years. The normal inventory holding
period for manufacturing is 45 days. The days of inventory holding for the company clearly
shows that the inventory is tied up for more than 3/4th of the year. The highest inventory
conversion period was found to be 346 days in the year 2009-2010. From the table it is clear that

----------------~(

69

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inventory holding period is decreasing in every year. In the year 2012-2013, it is decreased to
244 days and then to 236 days in the year 2013-2014.
T ABLE NO.3 INVENTORY

YEAR

t
It
,

..
..
..,
..
'

TO CURRENT ASSET RATIO

INVENTORY

CURRENT ASSETS

RATIO

2009-2010

13626855

14217644

0.96

2010-2011

14824135

15527237

0.95

2011-2012

15510469

16430269

0.94

2012-2013

15863247

16759947

0.95
0.94

2013-2014

18790904

19976707

CHART NO.3
INVENTORY TO CURRENT ASSET RATIO

,.

1
0.8 /

If!

"

0.6 /'
0.4
0.2

/--

VENTORYTO

~N

,.~
'f-

..

..

..

CURRENT ASSET RATIO

w7

INTERPRETATION:
Table no.3 shows trend of the inventory to current assets ratio. The ratio was 0.96 in the year

The
2009-2010 and decreased in the corresponding two years. The ratio keeps on changing every

year. From the year 2011-2012 onwards, the ratio remains almost the same till 2013. This is

...
_---------t(

)t---------

because of storage of funds in hand an inability70to convert. Lesser amount should be invested in

t the company will be in a position to have more liquid cash that is cash
current asse ts so tha
at
bank and cash in hand.

T ABLE NO.4 INVENTORY

YEAR

TO SALES RATIO

RATIO

SALES

INVENTORY

2009-2010

13700000
13626855

0.99

2010-2011

17100000
14824135

0.86

2011-2012

20500000
15510469

0.75

2012-2013

15863247
23100000

0.68

20l3-2014

18790904
26500000

0.71

CHART NO.4
INVENTORY TO SALES RATIO
~

0.8

0.6

0.4

III

I!II

II!I!I
I---

INVENTOR Y TO SALES
TIO

-l 2A
0.2

t--

V
V-

...

l1li

rwIt-;7

INTERPRETATION:
The Table no.4 shows inventory to sales ratio. The ratio first starts with 0.99 trends in the year
2009-2010, and after that the ratio keeps on decreasing. This shows that the ratio is varying
year after year. In the year 2013-2014 it increases to 0.71. A rising inventory-sales ratio means
that

----------t(
_

71

}r---

inventories are rising faster than sales and are becoming overstocked, and hence the maintenance
cost of the inventory also increases. But it also seems to be decreased. So, it has a balancing
maintenance cost.
TABLE NO.5 WORKING

CAPITAL TURNOVER

NETWORKING
CAPITAL

RATIO

YEAR

SALES

2009-2010

13700000

81600

167.8

2010-2011

17100000

159400

107.3

2011-2012

20500000

127000

161.4

2012-2013

23100000

370000

62.43

2013-2014

26500000

788000

33.6

RATIO

CHART NO.5
WORKIN CAPITAL TURNOVER RATIO

200
150
V
100 V
50

-..

..

WORKIN
CAPITAL
TURNOVER RATIO

.v

a V~

..

INTERPRETATION:
The Table no.5 shows the working capital turnover ratio. The working capital turnover ratio tests
the efficiency with which the working capital is utilized. In the case of Gemplastic the working
capital turnover ratio was very high in 2009-2010, and then it slightly decreases. This indicates
working capital was properly utilized for making sales in the first four years then it diminishes.

-----------t(

72

)t---------

TABLE NO.7

"

.
._

COST OF
MATERIAL

AVERAGE STOCK
OF INVENTORY

RATIO

2009-2010

6281600

1854000

3.38

2010-2011

7161000

1891000

3.78

2011-2012

10608000

1999500

5.3

2012-2013

114379200

2152000

6.68

2013-2014

19635000

2107000

9.3

YEAR

CHART
NO.7
RAW MATERIAL TURNOVER RATIO

.._

..
.

.
.

...

RAW MATERIAL TURNOVER RATIO

10

V
8

~r-

..
..
..
...
..
..
..
.

IIIIIiiMI

"
4

V
~

RAW
MATERIAL
TURNOVER
RATIO

f.f-

V
V
III

--

Ii

aI

1 -/

INTERPRETAT
ION:
The Tableno.7 shows raw material turnover ratio. High raw material turnover implies
reduced level of inventory in storage. Higher the ratio it is better for the organization.
Here from the above table and diagram it is clear that the ratio is increasing year by year
that 3.38 in 2010 to
9.3 in 2014. The ratio shows that the company is good in utilizing its raw materials and
also
performing well in management of raw
materials.

TABLE NO. 11 FINISHED GOODS TURNOVER RATIO

YEAR

COST OF
GOODS SOLD

2009-2010
1.4.0

AVERAGE STOCK OF
FINISHED GOODS

l3700000

RATIO
9448556

2010-2011

17100000

6198095.5

2.75

2011-2012

20500000

5212001.5

3.9

2012-2013
3.99

23100000

5780887

2013-2014
25.0

26500000

1057592.5

CHART NO.ll
FINISHED GOODS TURNOVER RATIO

FfNlSHED GOODS
TURNOVER RATIO

INTERPRETATION:
The Table no.ll shows the finished goods inventory turnover ratio. A frequent change is
happening to the ratios. The ratio shows an ihcreasing trend which indicates that the pace of
converting the finished goods to sales is increasing every year. The finished goods inventory
turnover ratio is another important in determining the organization's feasibility. It is good for the
organization.

TABLE NO.12

YEAR

DAYS

FINISHED

GOODS CONVERSION

PERIOD

FINISHED GOODS
CONVERSION PERIOD
(IN DAYS)

FINISHED GOODS
TURNOVERRA TIO

2009-2010

365

1.4

260.7

2010-2011

365

2.75

132.7

2011-2012

365

3.9

93.5

2012-2013

365

3.99

91.4

2013-2014

365

25.0

14.6

CHART NO.12
FINISHED GOODS CONVERSION PERIOD

FINISHED GOODS
CONVERSION
PERIOD

INTERPRETATION:
The Table no.12 shows the finished goods conversion period. Finished goods conversion period
is the time taken by the company to convert its finished goods into sales. The average conversion
period is 124 days. This means that the company keeps its inventory of fmished goods for an
average of 124 days before it is sold. The inventory conversion period is satisfactory as the
number of days for converting the stock of finished goods to sales is coming down year by year
which are good for the company.

----------------,(

79

)r---------------

._
~

._

...
...

.
. ..

TABLE NO. 13 QUICK RATIO

YEAR

CURRENT ASSET

CURRENT LIABILITY

2009-2010

14217644

12072421

2010-2011

15527237

RATIO

8291653

1.87

2011-2012

16430269

9210744

1.78

2012-2013

16759947

7113127

2.36

2013-2014

19976707

8200218

2.45

CHART NO.13
QUICK RATIO

_
_

..

./

!II

1.4

fIII_

1.2

V
0.8 V
0.6
1

..
..

1.17

0.4 V
./
0.2 V
/-

';

~
.,

QUICK RATIO
>--

~.

"'r:7

..
.

.
..
..

INTERPRETATION:
The table no 13 shows quick ratio of Gemplastic. A company's quick ratio to determine its
ability to cover the current liability using its quick assets, from the depicted table it is clear that
company can effectively erase its liability's. A company with a quick ratio of at least 1 has
sufficient quick assets to cover its current liabilities. A ratio of less than 1 suggests the company
must generate other funds, such as by selling inventory, to pay its bills. Here we can see
increasing trend in the quick ratio, but in 2014 it decreased to 1.44. The maximum was 2.38 .

RO

TABLE NO 15 CURRENT ASSET TURNOVER RATIO

YEAR

SALES

CURRENT ASSETS

RATIO

2009-2010

13700000

14217644

0.96

2010-2011

17100000

15527237

1.10

2011-2012

20500000

16430269

1.25

2012-2013

23100000

16759947

1.38

2013-2014

26500000

19976707

].33

CHART NO.15
CURRENT ASSET TURNOVER RATIO

1.4

1.2
1

0.8
0.6

0.4
0.2

V
V
V
V

II

"

~
..

f-

~,

f'.

f-

CURRENT ..

~
"I--

I--

o V~

.,

III

!Mill

...

ai7

INTERPRETATION:
The table no 15 shows current asset turnover ratio. The asset turnover ratio is an indicator of the
efficiency with which a company is deploying its assets. Generally speaking, the higher the
ratio, the better it is, since it implies the company is generating more revenues per dollar of
assets.

_----------.(

82

)t--------

FINDINGS
1. The organization is facing severe problem due to lack of efficient inventory software for
the better management of the inventories in the company.
2. Enterprise Resource Planning (ERP) is not implemented in the company which reflects
the overall performance of the organization favorably.
3. The requirement of inventory, which shown increasing trend and increasing in the future
period also.
4,. The inventory turnover ratio is high. The increasing turnover ratio indicates that the firm
has improved in its inventory management when compared to the previous years.
5. There is a fluctuating trend in inventory to current asset ratio. This is because of storage
of funds in hand an inability to convert.
6. Inventory-sales ratio shows that inventories are rising faster than sales and are becoming
overstocked.
7. The working capital turnover ratio reveals that the working capital was not properly
utilized by the firm for making sales in the first three years.
8. Inventory to working capital ratio of Gemplastic is not in a healthy position in the first
three years but then it shows a better position compared to previous years.
9. The raw material conversion period of Gemplastic is decreasing year by year. It also
shows a fluctuating trend. It means only less time is needed.
10. The work-in-progress turnover ratio indicates that more time is required for conversion of
work-in-process to finishe~ goods.
11.'The fmished goods inventory turnover ratio indicates that there is a satisfactory turnover
of finished goods.
12. It has been found that through the evaluation of quick ratio, Gemplast is in a liquid
position .
.13.Through the analysis it is identified that company is collecting receivables in the actual
time period.
"

nn

..

SUGGESTIONS
1. The company should concentrate to take correct measures for the proper
implementation of the ERP system in the organization.
2. The management should follow the policy of maximum utilization of available
resources because the cost of inventory increasing year by
year.
3. The company should take keen interest in the inclusion of inventory software for the
effective functioning.
4. A good rule of thumb is that if inventory turnover ratio multiply by gross profit
margin is 100% or higher, then the average inventory is not too high. A very high
I-...

turnover of inventory does not necessarily imply higher profits: The profits may be
low due to excessive cost incurred in replacing stocks in small lots, stock-out
situations, selling inventories at low very prices, etc. So the company can maintain
inventory turnover ratio in a reasonable level.
5. The company should find more than 3 suppliers because requirement of inventory
increasing over a period of
time.
6. The inventory to net working capital has shown a better ratio comparatively in the
past years.
7. Working Capital is a very essential element for any organization to undertake its
routine operations in a better way. But the organization has poor working capital
management system. So the company needs to concentrate more on its working
capital requirements.
8. The most important finding by the research was the problem of overstocking in
inventory. So the company needs to take stringent measures to inspect and monitor
so as to avoid overstocking and increasing inventory cost.
9. A person should be appointed to check the liquidity position of the firm; this is
because of storage of more funds in stock and inability to convert when it is needed.
So that the company will be in a position to have .more liquid cash, that is cash in
hand and cash at bank.

CONCLUSION
This project report deals with the study on 'Effecti veness of inventory management' undertaken
from GEMPLATIC INDUSTRIAL ESTATE PALA YAD. This study is conducted for analyzing
the inventory and its management within the organization. For a majority of manufacturing
firms, the major part of the working capital is found to be in the form of inventory. So the study
on Inventory Management at GEMPLATIC rNDUSTRIAL ESTATE PALA YAD throws light
on the various aspects of inventory management.
Inventory Management indicates the broad framework of managing inventory. Inventory
management system provides information to efficiently manage the flow of materials effectively,
utilize labor and equipment in an optimum way and coordinate internal activities. Inventory
Management does not make decisions or manage operations but provides the information to
managers who make more accurate and timely decisions to manage their operations. A
successful business relies on many factors, one of which is a reliable inventory management
system. Inventory management consists of everything from accurate record-keeping

and

receiving of products on time. An Inventory management that is properly maintained can keep a
company's supply chain running smoothly and efficiently.
The study shows that although there have been major improvements in certain areas of inventory
management, still the company needs to work on certain aspects of inventory management in
order to become capable

to compete with the other emerging private players and thereby

improve its profitability. The researcher hopes that the study on inventory management will be
beneficial to the company.
Thus the study can be concluded by saying that the firm's inventory management is efficient; but
to still more improve its efficiency, it can avail some of the suggestions provided by the
researcher.