OPERATIONS AND SUP

FINAL PROJ

Submitted by:
Group 3
Divyanshu Tiwari (18A1HP003)
Damini Raichandani (18A1HP085)
Manish Khiyani (18A2HP405)
Moupia Bhowmik (18A3HP648)

Submitted to: Prof. Vinay Kuma

Company Name
Product Category
RATIONS AND SUPPLY PLANNING

FINAL PROJECT

Tiwari (18A1HP003)
ichandani (18A1HP085)
iyani (18A2HP405)
howmik (18A3HP648)

bmitted to: Prof. Vinay Kumar Kalakbandi

Mahindra and Mahindra

Passenger Cars
Year Quarter Period Sales(In Cr.) Average Price (In Cr.)

Q1 1 9,542.34
Q2 2 8,773.38
2015 0.18
Q3 3 9,059.40
Q4 4 10,428.66
Q1 5 9,419.22
Q2 6 8,679.24
2016 0.18
Q3 7 11,233.44
Q4 8 13,084.38
Q1 9 10,684.80
Q2 10 10,105.02
2017 0.18
Q3 11 9,837.36
Q4 12 7,326.18
Demand(In Cr.)

53,013
48,741
50,330
57,937
52,329
48,218
62,408
72,691
59,360
56,139
54,652
40,701
 Average of the same
quarter every year
Quarter Period Demand(In Cr.) Seasonal Factor Deseasonlized Demand

Q1 1 53,013 54,901 1.0034865708 52828.808616471

Q2 2 48,741 51,033 0.9327864083 52253.1198627676
Q3 3 50,330 55,797 1.0198638577 49349.7241023956
Q4 4 57,937 57,110 1.0438631631 55502.4854271606
Q1 5 52,329 1.0034865708 52147.1851449891
Q2 6 48,218 0.9327864083 51692.4341630851
Q3 7 62,408 1.0198638577 61192.4812593345
Q4 8 72,691 1.0438631631 69636.5218804172
Q1 9 59,360 1.0034865708 59153.7562385399
Q2 10 56,139 0.9327864083 60184.1959741473
Q3 11 54,652 1.0198638577 53587.5446382699
Q4 12 40,701 1.0438631631 38990.7426924222
Q1 13 1.0034865708
Q2 14 0.9327864083
15 1.0198638577
16 SUMMARY OUTPUT 1.0438631631

Regression Statistics
Multiple R 0.0636791388
R Square 0.0040550327
Adjusted R Square -0.095539464
Standard Error 8458.748539538
Observations 12

ANOVA
df SS
Regression 1 2913206.36538458
Residual 10 715504268.551282
Total 11 718417474.916667

Coefficients Standard Error

Intercept 53782.16666667 5205.9998477546
X Variable 1 142.7307692308 707.3560880847
 Forecast
including
nlized Demand Ft Tt Error
trend &
seasonality

8.808616471 53782.17 142.7308 54112.91041 1099.91041

.1198627676 53782.17 142.7308 50433.54872 1692.54872
.7241023956 53782.17 142.7308 55287.18583 4957.18583
.4854271606 53782.17 142.7308 56737.18819 1199.81181
.1851449891 53782.17 142.7308 54685.82405 2356.82405
.4341630851 53782.17 142.7308 50966.09801 2748.09801
.4812593345 53782.17 142.7308 55869.44964 6538.55036
.5218804172 53782.17 142.7308 57333.15376 15357.8462
.7562385399 53782.17 142.7308 55258.73769 4101.26231
.1959741473 53782.17 142.7308 51498.64729 4640.35271
.5446382699 53782.17 142.7308 56451.71345 1799.71345
.7426924222 53782.17 142.7308 57929.11932 17228.1193
53782.17 142.7308 55831.65133 5310.0186 MAD
53782.17 142.7308 52031.19658
53782.17 142.7308 57033.97727
53782.17 142.7308 58525.08489 223421.91 Annual Demand

MS F Significance F
2913206 0.040715 0.844134
71550427

t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
10.3308 1.18E-06 42182.48 65381.85719 42182.476 65381.857190883
0.201781 0.844134 -1433.36 1718.818351 -1433.3568 1718.8183512814
 2015 2016 2017
Q1 53,013 52,329 59,360
Q2 48,741 48,218 56,139
Q3 50,330 62,408 54,652
Q4 57,937 72,691 40,701

Demand of Mahindra over the years

80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Q1 Q2 Q3 Q4
2015 2016 2017
 4 qtr moving Average demand
Quarter Period Demand(In Cr.) Seasonality index Ft
average for period

Q1 1 53,013 53782.17
Q2 2 48,741 52,505 53782.17
Q3 3 50,330 52,334 52419.75 0.9601343005 53782.17
Q4 4 57,937 52,204 52268.875 1.1084416873 53782.17
Q1 5 52,329 55,223 53713.25 0.9742288914 53782.17
Q2 6 48,218 58,912 57067.25 0.8449329519 53782.17
Q3 7 62,408 60,669 59790.375 1.0437800398 53782.17
Q4 8 72,691 62,650 61659.375 1.1789123714 53782.17
Q1 9 59,360 60,711 61680 0.962386511 53782.17
Q2 10 56,139 52,713 56711.75 0.989900682 53782.17
Q3 11 54,652 50,497 53782.17
Q4 12 40,701 53782.17
Q1 13 53782.17
Q2 14 53782.17
Q3 15 53782.17
Q4 16 53782.17
SUMMARY OUTPUT

Regression Statistics
Multiple R 0.0636791388
R Square 0.0040550327
Adjusted R Square -0.095539464
Standard Error 8458.7485395375
Observations 12

ANOVA
df SS MS
Regression 1 2913206.36538458 2913206
Residual 10 715504268.551282 71550427
Total 11 718417474.916667

Coefficients Standard Error t Stat

Intercept 53782.1666666667 5205.9998477546 10.3308
X Variable 1 142.7307692308 707.3560880847 0.201781
 Tt Forecast Error

142.7308 52215.89 0.968308 797.1065 Q1

142.7308 49602.55 0.917417 861.5514 Q2
142.7308 54316.46 1.001957 3986.458 Q3
142.7308 62162.38 1.143677 4225.38 Q4
142.7308 52768.72 0.968308 439.7227
142.7308 50126.33 0.917417 1908.326
142.7308 54888.5 1.001957 7519.502
142.7308 62815.33 1.143677 9875.668
142.7308 53321.55 0.968308 6038.448
142.7308 50650.1 0.917417 5488.9
142.7308 55460.54 1.001957 808.5388
142.7308 63468.28 1.143677 22767.28 5393.074 MAD
142.7308 53874.38 0.968308 0.974229 0.962387 0.9683077
142.7308 51173.87 0.917417 0.844933 0.989901 0.91741682
142.7308 56032.58 1.001957 0.960134 1.04378 1.00195717
142.7308 64121.24 1.143677 1.108442 1.178912 1.14367703

F Significance F
0.040715 0.844134

P-value Lower 95%Upper 95%

Lower 95.0%
Upper 95.0%
1.18E-06 42182.48 65381.86 42182.48 65381.86
0.844134 -1433.36 1718.818 -1433.36 1718.818
2015 2016 2017

53,013 52,329 59,360

48,741 48,218 56,139
50,330 62,408 54,652
57,937 72,691 40,701
 Company Name Mahindra And Mahindra
Product Category Cars

Company Employee Information (2017-18)

Average Salary (Per Quarter)
Number Regular Overtime
Labors 37673 407cr 82
Managers 4000 113cr 34
Total 41673 520cr 116

AGGREGATE PRODUCTION PLANNING REQUIREMENT

Q1 Q2 Q3
Demand Forecast 55831.6513327616 52031.1965785668 57033.977266501
Number of Working Days by Month 24 24 24

Aggregate Production Planning Requirements

Q1 Q2 Q3
Demand Forecast 55831.6513327616 52031.1965785668 57033.977266501
Safety Stock (10%) 5,583 5,203 5,703
Production Requirement 61,415 57,234 62,737

Costs of Four Production Plans

Production Plan 1: Exact Production; Vary Workforce

Q1 Q2 Q3
Production Requirement 61,415 57,234 62,737
Production Hours Required 1,228,296 1,144,686 1,254,747
Working Days per Month 24 24 24
Total Workers Available 2200 2200 2200
Hours per Quarter per Worker 576 576 576
Workers Required 2,132 1,987 2,178
New Workers Hired 0 0 191
Hiring Cost ₹ 0.00 ₹ 0.00 ₹ 1,146,470.57
Workers Laid Of 0 145 0
Layof Cost ₹ 0.00 ₹ 1,451,562.58 ₹ 0.00
Straight Time Cost ₹ 255,895,068.61 ₹ 238,476,317.65 ₹ 261,405,729.14

Total Cost ₹ 255,895,068.61 ₹ 239,927,880.23 ₹ 262,552,199.71

 Production Plan 2: Constant Workforce; Vary Inventory and Stockout
Q1 Q2 Q3
Working Days per Month 24 24 24
Production Hours Available 1267200 1267200 1267200
Actual Production 63360 63360 63360
Demand Forecast 61415 57234 62737
Shortage Cost ₹ 0.00 ₹ 0.00 ₹ 0.00

Straight Time Cost ₹ 264,000,000.00 ₹ 264,000,000.00 ₹ 264,000,000.00

Total Cost ₹ 264,000,000.00 ₹ 264,000,000.00 ₹ 264,000,000.00

Production Plan 3: Constant Low Workforce; Subcontract

Quarter 1 Quarter 2 Quarter 3
Production Requirement 61,415 57,234 62,737
Working Day per Quarter 72 72 72
Production Hours Available 1,267,200 1,267,200 1,267,200
Actual Production 63,360 63,360 63,360
Units Subcontracted (Production 0 0 0
Requirement - Actual Production)
Subcontracting Cost (Units ₹ 0.00 ₹ 0.00 ₹ 0.00
Subcontracted x Rs.45000)
Straight Time Cost ₹ 264,000,000.00 ₹ 264,000,000.00 ₹ 264,000,000.00
Total Cost ₹ 264,000,000.00 ₹ 264,000,000.00 ₹ 264,000,000.00

Production Plan 4: Constant Workforce; Overtime

Quarter 1 Quarter 2 Quarter 3
Working Days per Quarter 72 72 72
Production Hours Available 1,267,200 1,267,200 1,267,200
Regular Shift Production 63,360 63,360 63,360
Demand Forecast 55,832 52,031 57,034
Units Available before Overtime
(Regular Shift Production - Demand 7,528 11,329 6,326
Forecast)
Units Overtime 0 0 0
Overtime Cost ₹ 0.00 ₹ 0.00 ₹ 0.00
Safety Stock 5,583 5,203 5,703
Units Excessive (Units Available before 1,945 6,126 623
Overtime - Safety Stock)
Inventory Cost (Units Excessive x ₹ 19,451,835.34 ₹ 61,256,837.64 ₹ 6,226,250.07
10000)
Straight Time Cost ₹ 264,000,000.00 ₹ 264,000,000.00 ₹ 264,000,000.00
Total Cost ₹ 283,451,835.34 ₹ 325,256,837.64 ₹ 270,226,250.07
 AVERAGE SALARY OF LABOUR (per month) 40000
Number of working Days in a Month 24
Working Hour Available 8
Hourly Wage Rate 208.33333
Overtime Cost (Double of Hourly Wage Rate) 416.66667

Q4
58525.0848930066
24

Note 4 State the methods of estimating costs

The costs of hiring and layoff costs are estimated in proportion to the salaries.
Q4
58525.0848930066
5,853
64,378 Assuming 6 days a week
Assuming 20hours / unit

Assumed=6000
Hiring Cost 6000
Firing Cost 10000
Q4 Total Shortage Cost 20000
64,378 245,764 Inventory Cost 10000
1,287,552 4,915,282
24
2200
576
2,235 8,533
57 248
₹ 341,712.16 1,488,183
0 145
₹ 0.00 1,451,563
₹ 268,239,972.43 1,024,017,088

₹ 268,581,684.59 ₹ 1,026,956,833.14
ory and Stockout
Q4 Total
24
1267200
63360 253440
64378 245764
₹ 20,351,867.65 ₹ 20,351,867.65

₹ 264,000,000.00 ₹ 1,056,000,000.00
₹ 284,351,867.65 ₹ 1,076,351,867.65

ubcontract
Quarter 4 Total
64,378 245,764
72
1,267,200
63,360

1,018 1,018

₹ 45,791,702.20 45,791,702

₹ 264,000,000.00 1,056,000,000
₹ 309,791,702.20 1,101,791,702

vertime
Quarter 4 Total
72
1,267,200
63,360
58,525 223,422

4,835 30,018

0 0
₹ 0.00 0
5,853 22,342

0 8,693

₹ 0.00 86,934,923

₹ 264,000,000.00 1,056,000,000
₹ 264,000,000.00 1,142,934,923
ortion to the salaries.

Rupees Per Hired Employee

Rupees Per Fired Employee
Rupees per unit
Rupees per unit'
Company Name Mahindra and mahindra
Product Category Cars
Distributor City Hyderabad
Factory Location Zaheerabad
Distance (in km) 116

Total Annual Demand 223421.9 Note 1

Note 2
For the Distributor
Demand estimation for the distributor 343.726 Note 3
Variability in demand 8081.5023069896 Note 4
Lead time (in days) 11 Note 5
Transportation Cost 9187 Note 6
Ordering Cost 13780.5 Note 7
Inventory Holding Cost 12747.9464268776 Note 8
Stockout Cost 50000

EOQ 27.2604840289
Safety Stock 2.7260484029
ROP 13.0849141563
ROQ 27.2604840289
# of orders in the year 12.6089470618
State the method of estimating the sliced demand for the Distributor City
State the method of estimating demand variability

State the method of estimating the transportation cost

150% of transportation costs
Assume Inventory carrying cost for distributors is 5% more than company
Assume same as backlogging costs in Aggregate planning
@ Average Selling price*Number of units sold (assume entire ordered quantity is sold)
Total distributers= 650

WORKINGS
Inventory Value 2,687.93
Total Inventory Cost (10% of Inventory Value) 268.793
Inventory Cost per Unit (Total Inventory Cost / T 12747.9464268776

Average Demand Per Unit Time 0.9417150685

Q1 59,360
Q2 56,139
Q3 54,652
Q4 40,701
Total Units for 2018 210852
 BILLS OF MATERIAL

Company Name Mahindra and

Mahindra
Product name Passenger Cars
Units Lead Time In hand
Gear Box 1 1 month 20000
Wheel 4 1 month 60000
Mechanical & Electrical Supply system 1 1 month 19000
Ignition system 1 1 month 25000
Music System 1 1 month 22000
Braking system 1 1 month 18700
Clutch Plate 1 1 month 19000
Mirrors 4 1 month 85000

Gear Box 2
0 January February March
Gross requirements 18611 18611 18611
Projected available balance 20000 1389 0 0
Net requirements 0 0 17221 18611
Planned order receipts 0 17221 18611
Planned order releases 0 17221 18611 17344

Wheel 2
0 January February March
Gross requirements 74442 74442 74442
Projected available balance 60000 0 0 0
Net requirements 0 14442 74442 74442
Planned order receipts 14442 74442 74442
Planned order releases 14442 74442 74442 69375

Ignition System 2
0 December January February
Gross requirements 18611 18611 18611
Projected available balance 25000 6389 0 0
Net requirements 0 0 12221 18611
Planned order receipts 0 12221 18611
Planned order releases 0 12221 18611 17344

Mechanical & Electrical Supply system 2

0 January February March
Gross requirements 18611 18611 18611
Projected available balance 19000 389 0 0
Net requirements 0 0 18221 18611
Planned order receipts 0 18221 18611
Planned order releases 0 18221 18611 17344

Music System 2
0 January February March
Gross requirements 18611 18611 18611
Projected available balance 22000 3389 0 0
Net requirements 0 0 15221 18611
Planned order receipts 0 15221 18611
Planned order releases 0 15221 18611 17344

Braking System 2
0 January February March
Gross requirements 18611 18611 18611
Projected available balance 18700 89 0 0
Net requirements 0 0 18521 18611
Planned order receipts 0 18521 18611
Planned order releases 0 18521 18611 17344

Clutch Plate 2
0 January February March
Gross requirements 18611 18611 18611
Projected available balance 19000 389 0 0
Net requirements 0 0 18221 18611
Planned order receipts 0 18221 18611
Planned order releases 0 18221 18611 17344

Mirrors 2
0 January February March
Gross requirements 74442 74442 74442
Projected available balance 75000 558 0 0
Net requirements 0 73884 74442
Planned order receipts 0 73884 74442
Planned order releases 0 73884 74442 69375
 Forecasted Demand
Q1
Q2
Q3
Q4

2018
April May June July August September October November December
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
69375 69375 69375 76045 76045 76045 78033 78033 78033
0 0 0 0 0 0 0 0 0
69375 69375 69375 76045 76045 76045 78033 78033 78033
69375 69375 69375 76045 76045 76045 78033 78033 78033
69375 69375 76045 76045 76045 78033 78033 78033 0

2018
March April May June July August SeptemberOctober November
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
 17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
17344 17344 17344 19011 19011 19011 19508 19508 19508
0 0 0 0 0 0 0 0 0
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 17344 19011 19011 19011 19508 19508 19508
17344 17344 19011 19011 19011 19508 19508 19508 0

2018
April May June July August September October November December
69375 69375 69375 76045 76045 76045 78033 78033 78033
0 0 0 0 0 0 0 0 0
69375 69375 69375 76045 76045 76045 78033 78033 78033
69375 69375 69375 76045 76045 76045 78033 78033 78033
69375 69375 76045 76045 76045 78033 78033 78033 0
No. of Units Monthly
55832 18611
52031 17344
57034 19011
58525 19508