FORE SCHOOL OF MANAGEMENT

A Report on
Industrial Visit to PARLE and RELAXO

Date Of visit : 11th Oct. 2010

Submitted By
Hiralal Senapati
191087
FMG-19-B
The company began as a small enterprise in the year 1976 and was officially incorporated
in 1984 and further went into public listing in 1995. According to the 2008 Business
Survey, it has now emerged as the second largest footwear producer in India.

Relaxo Footwear commenced its journey with the manufacture of Hawaii slippers. It has
now grown into a large-scale entrepreneurship catering to the basic needs of the
quintessential Indian citizen. From a modest sale figure of Rs. 1 million in 1977 to more
than Rs. 5000 million last year; the company has experienced a record-breaking growth
since inception. Today, the company manufactures over 3 lakh pairs of footwear per day,
which approximately adds up to over 10 million pairs per year. Each pair is given
thorough attention by the dedicated and skilled employees working at the 10 state-of-the-
art manufacturing units in Northern India. Thus, it is no small wonder that the annual
turnover has multiplied 2.4 times in the last 3 years from Rs. 305 crore in 2007-08 to a
whopping Rs. 550 crore in 2009-10.

What’s more, with over 30 years of experience and 100 million satisfied customers,
Relaxo keenly looks forward to achieving an estimated annual turnover of Rs. 1000 crore
by the year 2012.

Operations

The factory works for 16 hours a day, 6 days a week. The entire production is divided into
shifts of 8 hours. It is a having a mixed type of layout. All the production process is done
in the ground floor. Cutting, finishing, fixing the parts, printing, packing, labeling etc is
done in the first and second floors. Relaxo makes the “Flite” brand in this facility,
wherein the production is done using the EVA injector technique which is of one of its

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kind in manufacturing footwear in India. They use Ethyl Vinyl Acetate (EVA) and Poly
Vinyl Chloride (PVC) for making the slippers. There are around 20 odd injectors on floor
and each doing 60-70 injections in 12 hours. Floors have clear demarcations for workers
to have uninterrupted work. They use both manual operated and pneumatic machines for
the fixing purposes. As far as the design part is considered, they come up with new
designs in every month which helps them to keep pace in market with the competitors.
They gives more importance to product design and development.

Marketing

Rural market is the main focus of the Relaxo Footwear as rural India accounts for 70% of
population. Thus the product is relatively cheaper. With launch of Sparx brand Relaxo is
now targeting the urban markets with fancy looking sandals etc. They have 150 own retail
stores scattered across the nation. Products of various designs are available in Relaxo.
Now they are targeting the North India mainly, even though a portion of sales comes from
all parts of the country. In future, they are planning to expand their business mainly to all
parts.

Human resources

A total of 850 workers are there in Relaxo, working for 16 hours a day, 6 days in a week.
The workers are trained and skilled in what they do (specifically the testing team
department), as most of work is done manually except for injection process. The
management is not so stringent towards the employees which give them stress free
environment for working. They are also provided with canteen facilities.

Financial Management

The management has experts to do with the finance aspects of the company. Since the raw
materials needs to be procured 6 months in advance, the forecast on the cost must be
properly done for the cost calculation. They do well in thos thing by the experience they
acquired in years. The turnover for the last financial year touched the mark of 550 crores.

Recommendation

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Being a rubber and chemical user, steps must be taken regarding eco friendly
environment. Processing gases should be converted to harmless forms to make pollution
less severe.

In 1929, a small company by the name of Parle products emerged in British dominated
India. The intent was to spread joy and cheer to children and adults alike, all over the
country with its sweets and candies. The company knew that it wouldn’t be an easy task,
but they decided to take the brave step. A small factory was set up in the suburbs of
Mumbai, to manufacture sweets and toffees. A decade later it was upgraded to
manufacture biscuits as well. Since then, the Parle name has grown in all directions, won
international fame and has been sweetening people's lives all over India and abroad.

Apart from the factories in Mumbai and Bangalore Parle also have factories in
Bahadurgarh in Haryana and Neemrana in Rajasthan, which are the largest biscuit and
confectionery plants in the country. Additionally, Parle Products also has 7 manufacturing
units and 51 manufacturing units on contract.

Parle Products has been India's largest manufacturer of biscuits and confectionery, for
almost 80 years. Makers of the world's largest selling biscuit, Parle-G, and a host of other
very popular brands, the Parle name symbolizes quality, nutrition and great taste. With a
reach spanning even the remotest villages of India, the company has definitely come a
very long way since its inception.

Products

Parle produces more than 32 prodcts in its plants. It deals in biscuit goodies, sweets and
snacks segment.

Biscuit goodies

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 • PARLE G

• Krackjack

• Magix

• KREAMS

• PARLE 20-20 COOKIES

• NIMKIN

• Hide & Seek Bourbon

• Chox

• Hide and Seek

• Hide & Seek Milano

• Parle Marie

• Milk Shakti

• Digestive Marie

• Golden Arcs

• Monaco Jeera

• Kreams Gold

PARLE FACTORY - BAHADURGARH

This Parle industry makes three main types of its products namely Parle-G biscuits,
Monaco Biscuits and Krack-Jack biscuit. The oven present in this site is the largest oven
in Asia and also the whole length of the manufacturing unit is also the longest which is
around 300 feet.

Operations

Making biscuits consists of raw materials testing and mixing it, then molding and the
baking and finally cooking and then packaging follows the last. The workers are to wear

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separate clothes and often applied on anti bacterial spray. This site produces nearly 175
tonnes of products everyday and around 1.5 to 2 % of wastes can be encountered. For
making candies, glucose and water are mixed first in the required amount of proportion
and then filtered. They are then cooked and then processed in the forming state. Then
sorting is done and wrapping of the candies are done which is finally followed by the
packaging of the items. Except for the production of Monaco, all the others are fully
automated. Packaging has been done carefully here in the Bahadurgarh site.

Steps involved in biscuit making

Raw material
testing

Mixing

Molding

Baking

Cooling

Packaging

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 Steps involved in toffee making

Milk Syrup EdibleOil

Toffee cooker

Cooling

Pulling jar

Wrapping

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 Steps involved in candy making process

Liquid glucose Sugar

Water Steam

Dissolver

Filter Press

Candy cooking
machine

Blending

Kneading

Forming

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 Sorting

Throughout India, Parle has 90 Depots through which their products pass through. These
Wraping
are directly owned by the company. After that, they have around 10,000 distributors
which are not owned by the company but have been working for Parle since many years.

They also have a very aggressive supply chain management system. The product lines are
very high and the brand equity it has is also high. Plus Parle used to be a monopoly in
terms of biscuits years ago.

Marketing

The company itself does speak of the imitators that are making biscuits and other forms to
imitate the products of the Parle Products. As a market leader, Parle cannot go on and find
the culprits. Instead they are more concerned about making newer and better products.
They are mainly targeting the rural markets. Demand for their product is increasing day
by day giving a challenge to their production capabilities.

Human Resources

Parle family consists of all the employees and owners and treated each and everyone as
their own family members. Job is more secured here in Parle. It’s the leading FMGC
product manufacturer. Parle has a very long time relationship with the suppliers. They
even have sugar mill in a certain part in Haryana. They have strong CSR activities.
Recently, they have established schools and colleges in Delhi and Haryana. Also, they
have provided pre-lunch for the school kids in Haryana.

Financial management

Being a large profit making company, Parle has a strong surplus fund reserve with it. It
could be used for further expansion when they needed. One interesting point worthy to be
mentioned about Parle products is that despite the economic slowdown and price rise, the

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prices of Parle products have never risen as such. This is whole due to its concentration
on productivity. Increase in automation and waste management that brought down wastes
percentages from 8 to around 2 % also helps in maintaining price level. And finally, cost
cutting through proper hiring which is enabled by a good HR team also helps in
maintaining prices of Parle. Parle Products, which makes the ubiquitous ‘Parle-G' glucose
biscuits, had attained volume leadership in the market. Now, with a total turnover of
around Rs 4,000 crore coming from biscuits, Parle Products has emerged as the clear
market leader, with a difference of almost Rs 1,000 crore.

Recommendations

It will be more beneficiary for Parle if they come to the business of cool drinks and other
beverages. They have their brand value as their main advantage, which can be utilized by
introducing new products.

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