1) Introduction

Inventory is nothing but the goods which the company has with the intention of selling it at
profit. It can be raw material which is purchased and turned into a finished product or small parts
and sell them separately. Controlling inventory and monitoring it after it has been directly
purchased or produced as finished products, then it is sold is known “inventory control.” In
short its movement of products between purchase and sale and ensuring that the appropriate
quantity of the product are sought at the right place at the right timing. “Stock” is the term used
to describe the items you sell. The method of controlling inventory is that tracks inventory levels
and items that can be taken from your warehouse and then returned. Controlling involves
managing and storing ingredients, raw materials and finished products and the management of
ingredients, raw materials and finished product.

Concept and Application

There are wider range of inventory management techniques. Tone needs to choose the correct
techniques based on the product they are offering to their customers. Below are the some of
known types of inventory:

• Products which are sold at the end of the line can be offered to consumers. In other words they
are called as finished products

• The basic input known as raw materials or components can also be sold to create a final
product

• Work in progress goods are not finished goods but include raw material, labour, overhead etc.,

• MRO (Maintenance Repair and Operation) goods is used to aid in the production process.

• Safety stocks are additional stocks that are held in the event of shortages and to cover such
unexpected anticipation.

• Seasonal inventory are used to meet the seasonal demand as demand fluctuates during various
seasons

• Pipeline or transit inventory are the stocks that move between manufacturer, warehouse and
distribution centre and receipt from suppliers

• Decoupling inventory is used for additional WIP stock which are kept to prevent any
stoppages.

• Company orders Cycle inventory so that they get right amount of stocks at a lower storage
price
Now lets understand the inventory management strategies offered in the market, and the methods
that auto service may employ to manage their inventory.

1. Bulk Shipment: under this method, the company makes purchases in bulk at a cheaper
or lower price. This method is widely across the industry. The advantages of this method
is its profitability as the stocks are purchased at lower price and incurs lower shipment
cost. However, the major risk includes capital risk. Such inventory management is
difficult to manage when the demand fluctuates

2. ABC Inventory Management: ABC Inventory management categorizes the stock into
the categories of importance, A being the most important and C being the least. Further B
being mid-range items that also add value to your business. Each year ABC analyzes
stocks based on annual consumption units, inventory value, and cost significance. It is
because not all products are equal. ABC inventory control has benefits, such as aids in the
forecasting of demand by analyzing the products popularity over time. It allows for time
management and allocation of resources, and also creates strategy for inventory accuracy
in pricing. One of the major disadvantage is this ABC management requires lot of time
and human resources. It also conflicts with rest of inventory management

3. Just-in-Time stocks: JIT stock management minimizes the amount of inventory an

organisation can keep in its hand. It uses risky technique because the inventory are
purchased few days before the actual sale. By keeping reduced inventory or stock, JIT
reduces the cost of inventory protection and prevents instances when deadstock
(inventory which are kept at warehouse for months). The cost of managing inventory is
reduced. The cash flows are improves and reduces the deadstock. The drawbacks of JIT
are to fulfil the orders on time. There may be instances of being out of stock. The
organisation must ensure that they have reliable suppliers who supplies the product at
right time.

4. Economic Order Quantity (EOQ): It is the most useful technique where the business
purchases and hold the inventory for manufacturing, resale and for internal purposes.
When the supplier offers discounts on bulk purchases or other incentive to purchase
more, this technique offers to decide the right place to draw a line. The main reason for
the creating EOQ is to cut down the cost of holding with it and removes resources for
other activities like R&D, marketing which helps in boosting the sales.
 5. Inventory Cycle Counting: It is the process of calculating small amount of inventory on
a specific day rather doing a complete count of inventory. This sampling technique allows
to verify the accuracy of inventory records that matches with the actual inventory. Many
businesses employ the process of managing inventory because it helps what the consumer
wants, when they actually need them. And simultaneously the cost of holding inventory is
minimum. Benefits are that the partial counting of stock will take lesser time and effort. It
is possible to do it without disrupting the operations of the company.

Conclusion

Therefore, auto repair firms could use these methods to have efficient inventory management.
The most efficient method of managing their inventory is making use of ABC technique in
managing inventory. The inventory is split into 3 groups, consequently, it is feasible to keep track
of it. Any business, whether being small or big, one needs to take control of the inventory. One of
the reason for failure of a business is its inventory management. There are new technologies that
can help us in maintaining and supervising the inventory. What we can do is learn, implement
and evaluate into the business.

2) Introduction

The layout planning involves arrangement of resources available in an organisation to improve

the performance of operation management. Plant layout is management of overall process of
production, store room and stock room, employee services etc., which helps in simplification of
production in factory. It provides various techniques to the manager which helps in deciding the
location of the resources and the impact of its alternative. It includes production and service
facilities and provides effective usage of men and materials.

Concept and Application

Object of plant layout are:

• The handling of materials should be minimum.

• Elimination of disadvantages through balancing of plant capabilities

• High material turnover in a shorter span of operating cycle

• Effective usage of space at factory

• Effective utilisation of labour by elimination of idle time

• Elimination of physical effort required by the labour

• Maintenance of discipline inside the factory

• Better working conditions like ventilation, lighting, effective control of noise pollution

• Better consumer service through cheaper and quality products and lesser delivery time

Popular types of plant layout:

1. Process Layout: It is also called as functional layout. All the machinery activities which
performs a similar type of operation are grouped into one location under process layout. In an
engineering shop all the lathes, mining, machines etc., are clustered into groups.

In such layout multiple products are made by using a single machine, thus making full use of
the machinery. This confirms that the process and not the product has dominating role and the
product is given secondary chase and moved for operation to the process section along with
the machines which are kept at one place. This type of layout is more convenient for
producing unique or customised products

2. Product Layout: It is also referred as line layout. Equipment, devices and machinery utilised
for processing of the product are arranged in sequence. The arrangement of the machine must
be in a sequence which does not mean arrangement in a straight line The majority of
information stored on the platform is kept from the same location. Under this layout, raw
material goes though all the machines arranged in an order as required by the manufacturer so
that he can produce a product. The process of putting same amount of load at each stage of
production is called line balancing. Here the product is given primary importance and process
machine is required when the product needs its service.

3. Functional Layout: This layout is useful for production in small quantities. If the product
isn’t standardised, then the layout isn’t useful as it is more likely to be altered depending on
the alternatives.

4. Fixed Layout: In todays world, this type of layout is important to a manufacturing industry.
As the major component remains fixed and rest of the materials, parts, tools, machinery,
human resource are bought to that location. The major component remains fixed as it is too
heavy or big or its economical to bring other components at one location. Such layouts are
 used in the manufacturing unit of boilers, hydraulic, ships etc.,

5. Combined Layouts: Here, pure process or product layouts are not present. Both process and
product layouts are mutually exclusive. Hence benefits of both are obtained to some extent.
Flexibility is important factor, so layout should be such which can be combined according to
the requirements of industry, without big investment

6. Group Layout: Group technology is used to combine all the components and resources. Such
implementation of group technology is known as cellular manufacturing. Correct measure for
manufacturing same products are utilised to identify part families. Next to each part family,
machine groups are identified and the layout is formed accordingly. The main benefit is once
the family part and machine part are identified, this layout makes sure that each cell has few
components which are to be processed

If you are deciding on a method to manage retail store, then factors like products it is selling,
customer’s habits and space available needs to be considered. If store is selling large variety of
products then grids layout is suitable. For a small scale store free flow designs or layout is
suitable. If you want your customers to want to browse, touch and look at your products then
group layout would be best.

We can choose “Grid layout” for the retail store. It is the most commonly used layout that
retailers use. For example in pharmacy stores, grocery stores that sell packaging containers when
store has lots of product and as a result of the retail store needs to make utilise the space
available to maximum extent.

The benefits of grid layout

• It is easy to categorise the product

• The consumers are used to a grid layout enabling them to shop easily

• Allows for a wide variety of infrastructure inside store, such as shelving, fixtures.

• It makes easy to place promotional items where customers will pass through
Negatives of grid layouts

• It’s not the best idea and is difficult to make this design work to provide customers with an
“shopping experience” to customers.

• Customers cannot take shortcuts to what they need and may bump into each other if aisles are
not wide

• The sight of buyer is blocked as they need to see the aisles on both sides.

• Can be confusing to customers if the grouping of product is incorrect

Grid patterns are extensively employed in the retail industry, they have been studied extensively
and retailers are aware of ways they can use grid patterns to improve conversion of revenue. In
order to increase sales, they can utilise grid patterns:

• Well-placed Promotions: This is located at the eye level. If consumer walks an anticlockwise
of “grid-style” one can notice that you’re further than the intended direction. This means that
the advertisements are placed at eye level but are slightly off the location.

• Power Wall: It is better to take advantage of the wall space in order to construct power walls
inside retail store. They can be used to display your merchandised products and draw
customers into an area that might be missed due to the normal flow of visitors. Retailers make
use of repetition by putting several similar products in the ceiling, typically in different sizes
and shades.

• End caps and visual displays: Aisle fixtures have to end, and usually the ends of those aisles
are prime real estate to put up a product display. They are usually the best place to display the
product.

Conclusion

The satisfaction of the customer is determined by the intention to utilise your site as a place to
conduct business reasons (whether physical or digital). The purchase decisions of your customers
are influenced by how they feel about your product.
3a) Introduction

The location of the restaurant is essential to determine overall efficiency. When choosing the
place it is important to take into many things into consideration with a lot of thought and
direction. In this regard, we’ve created an extensive list of websites for restaurants that you can
browse before choosing the ideal site for your company.

Concept and Application

Chennai is believed to be the place where the restaurant’s first traces began. Chennai is one of
the dense populated city which has morning crowd, as well as night-time crowd. The most
demanded site to open an restaurant would be Nungambakkam as it provides:

• Front-of-house locations: A good front-of-house area brings success to your business. The
restaurant which is stationed near the entrance of the building or shopping mall will be able to
enjoy more visibility and attract higher number of customers. It is favoured by the customers
which are in front of them as it’s right across the street for them. Customers will not prefer the
restaurant when it’s hard to locate or they have to cover longer distance

• The Rooftop or Upper Floor Location: If you are deciding on a place to locate a restaurant
site, upper or top floor location are to be avoided. Because customers might have difficulty
reaching the restaurant located on the top. If you like to open restaurant on the highest floor,
you must ensure that the building is equipped with elevator. People do love rooftop restaurants.
But, they also have challenges. The main challenge is to obtain a trade license as rooftop
restaurant, cannot have kitchens on its top floor, which implies that the kitchen needs to be
operated at different floor. This can be a challenge as bringing food to the roof requires
additional staffs.

• Access and Parking: Ease of access to the restaurant as well as parking are vital elements of
or selecting the restaurants, and they should not be ignored. Customers will opt for other
restaurants if they are unable to access or reach the restaurants if they are unable to reach
quickly. Availability of parking is essential to the success of your restaurant. If the restaurant
does not have spacious parking customers will choose to dine into other restaurant.

• Building Amenities: It is important to check whether the building selected for restaurant has
latest features. For example power back-up is one the most important amenities which helps in
 brand building of the restaurant. Building a restrooms are integral part of every restaurant and
should be considered when choosing a location.

Conclusion

Choosing the ideal location is the first step to start the restaurant. The efficiency for a business is
heavily dependent on its location which must be in a prime location. Also the above factors
discussed above also decides the price of restaurants. Selecting of prime location does increases
the cost, however, selection of good place for business is essential. But it does not mean to spend
the entire budget in selecting the site. In general, the cost must not exceed 10% of the projected
revenues.

3b) Introduction

Demand prediction strategies can be utilised to formulate the business plan for the company.
Aggregate planning is the method of developing, analysing and maintaining a schedule of overall
operation of an organisation. A business plan in general contain forecasted sales, production level
and inventory in hand and consumer backlogs. Successful plan should minimise the effects of
shortsighted, daily scheduling wherein small amount of orders are placed in a week along with
laying off of workers and then followed by ordering in huge quantities and simultaniously hiring
workers next week. In short, aggregate planning means to balance the capacity and demand in
such a way that cost incorrect are at its minimum.

Concept And Application

The strategy of the company is important because it is required to find perfect equilibrium
between strategies that help in both long-term strategic planning as well as short-term
production. The following objectives for a strategic plan:

1. Minimising the cost towards inventory management

2. Minimises the workforce demand and its fluctuation

3. Maximises the production rate at the same time minimises the fluctuation

4. Stabilises manufacturing efforts and improves on-time delivery. As a result it improves supply
chain relationships
Companies have the option of selecting between three different strategies to structure their
overall strategy. The details are as below. Below.

2. Level strategy: This strategy seeks to produce a plan that maintains same level of production
along with same employment level. In order to match the changes in customer demand, the
firm should either increase or decrease inventory levels based on the prediction of increased or
decreased levels of forecasted demand. The organisation maintains same level labour and
output when demand is somewhat less. This ensures that the organisation maintains higher
inventory levels that which are required. As demand slowly increases, the organisation is able
to continue a steady production rate along with steady employment level. As a result the extra
or surplus inventory is absorbed by increased demand.

3. Chase Strategy: This strategy refers towards matching the demand and capacity periodically.
This leads to considerable amount of hiring (when demand is higher), firing or laying off of
employees (when demand is lower) which intern results in insecure and unhappy employees;
increased inventory management costs; problems with labor unions and inconsistent utilisation
of plant and equipment. It also implies a great deal of flexibility on the firm's part. The main
advantage of chase strategy is that the inventory level can be at it lowest level. Many firms
who adopt just-in-time production concept, makes uses of this approach to do their business
planning.

4. Mixed strategy: The chase and level strategy shows two types of aggregate planning.
However in real life, one can expect an organisation to choose a combination of available
operational planning to formulate their strategy. Mixed strategy is combination of both level
and chase strategy.

The purpose of the combination of planning is to meet the company’s goals over the long term.
Below are the advantages of combined planning:

• Profits can be increased by reducing the universal variable price.

• Utilisation of available production facilities to produce top quality products

• Customer satisfaction can be achieved by growing demand and reducing the time taken for
delivery.
• It helps in lowering inventory management cost and meeting deadlines and there by increasing
employee satisfaction.

Conclusion

The restaurant can adopt mixed strategy as the advantages of such strategy surpasses the benefits
provided by other AOP. We can observe that the crowd at a restaurant during night or evening
time is higher when compared to day time. Similarly the crowd or demand during the weekends
are higher when compared to weekday. Hence, if the restaurants adopts mixed strategy, it will
help in achieving customer satisfaction, meeting business long term objective, proper utilisation
of production facility and better inventory management. The process of planning helps ensure
that the strategic intentions of the business and its objectives, cost of production and inventory.