Analyzing Logistic Management in MPF Industrial Group: Project Report

This project report examines the logistic management practices of MPF Industrial Group, a manufacturing company in Singapore. The report analyzes the interfaces between the logistic department and production, marketing, and accounting/finance departments. It delves into the order cycle, outlining its steps and key performance indicators (KPIs), and suggests improvements. Furthermore, the report explores inventory management, assessing its performance through inventory turnover, stockout/fill rates, and lifespan needs. The analysis highlights how effective logistic strategies contribute to cost reduction and enhanced profit margins for the company, emphasizing the importance of efficient supply chain management and its impact on overall business performance. The report concludes with recommendations for optimizing the order cycle and inventory management to further improve efficiency and profitability within MPF Industrial Group.

Running Head: Logistic Management
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Project Report: Logistic Management

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Contents
Introduction.......................................................................................................................3
The interfaces....................................................................................................................3
Production.....................................................................................................................4
Marketing......................................................................................................................5
Accounting and finance................................................................................................6
Order cycle........................................................................................................................6
Steps of order cycle......................................................................................................7
KPIs..............................................................................................................................8
How to improve the order cycle...................................................................................8
Inventory management.....................................................................................................9
Performance of inventory management........................................................................9
Recommendation........................................................................................................10
Conclusion......................................................................................................................10
References.......................................................................................................................11

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Introduction:
MPF industry group is a manufacturing company in the Singapore market. The main
products of this company are Precision industrial components, heating devices, abrasives,
tools, building material, accessories, power tool accessories, furniture etc. this company is a
global company and the major investment of this company comes from the Europe. This
company is recognized as the third biggest family business owned by Hungarian family. This
company is featured in top 1000 companies to motivate Europe published company by the
LSX (London stock exchange). This company is currently earning US $350.70 million
according to its annual reports. The profit margin of the company is also higher which depict
about the better management of the company.
According to the annual reports of the company, the company has performed very
well in the market. This company has started its business in 1976 and right now, various
markets have been analyzed by the company and currently the services and products are
offered by the company in that market too. Through this case, it has been estimated that the
company was a private company earlier and then various efforts have been put by the owners
of the company to make it legal into the market (MGF, 2017). Currently, the entire
department of the company are performing well and due to that the performance and the
profit margin of the company has been improved. In current scenario, the logistic department
of the company has been analyzed and found that various new policies and techniques have
been applied by the company to manage and enhance the profit margin of the company. The
scenario of logistic department of the company depict that every decision of logistic
department is inspired by the other departments of the company (Stock, Boyer & Harmon,
2010).
The relation of logistic deparemnt with other dperatemnts has been studied further.
This report has been emphasized to identify the role of logistic department tin an organization
and it also depict that how the logistic department helps a company to reduce the expenses
and enhance the profit margin.
The interfaces:
Interfaces are a technical term which is used by the company to maintain the
relationship among various departments and aspects. Logistic interface is a communication
channel which allows the company to manage every aspect smoothly.

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Production:
Production logistic interface depict that how the production department and the
logistic department related to each other. In this study, various aspect and theories of
production department has been studied which depict a relation with the logistic department
of the company. In MPF industrial limited, it has been analyzed that the proper theories and
the techniques are used by the company to manage the interface in the production department
and the logistic department of the company. The product scheduling is done by the company
according to the raw material available and the demand in the market. Further the supplier are
also chose by the company near to the factory or the plant so that the shipping charges of the
company could be reduced and the purchase of raw material is done after analyzing the
various suppliers and their price.
Further, being a production manager of the company, it has also been analyzed that
the production system of the company is of short term. As the order of the company goes to
the production cycle and turns up into the finished goods quickly. More the raw material of
the company could not be retained for a long period so that production runs of the company is
of short run. Further, as a production manager of the company, it has been analyzed that the
cost of the company could not be reduced due to the short production run of the company.
and company must use different strategy to cut the cost of production of the company.

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(Shepherd & Günter, 2006)
Marketing:
Marketing logistic interface depict that how the Marketing department and the logistic
department related to each other. In this study, various aspect and theories of Marketing
department has been studied which depict a relation with the logistic department of the
company. In the Marketing department, the main function is promoting the product into the
market, conduct a research over the operations of the market and changes into the market.
Further, it also helps the marketing department to manage the product mix so that the cost
reduction could be possible and it also help the company to manage the sales force of the
company to enhance the sales in the market (Selviaridis & Spring, 2007). Logistic department
sets an interface with the marketing department to manage the activities of the department
through pricing techniques, customer services, packaging, and retail etc services.

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Further, being a production manager of the company, it has been analyzed that the
traditionalist approach of this department depict that the logistic department must not
interfere into the marketing department whereas the relabeling perspective shows that the
marketing department policies are directly linked with the logistic department. In this entire
activities of marketing department could take place easily due to the logistic management.
Lastly, the unionist perspective depict that the logistic is the part of marketing and offers
various functions such as pricing techniques, customer services, packaging, and retail etc to
the marketing department of the company.

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(Sachan & Datta, 2005)
Accounting and finance:
Accounting and finance logistic interface depict that how the finance department and
the logistic department related to each other. In this study, various aspect and theories of
finance department has been studied which depict a relation with the logistic department of
the company. In the finance department, the main function is analyzing the funds, raise the
funds, record the entries, make the financial statement, enhance the revenue of the company,
offer high return to the shareholders etc. Further, as a production manager of the company, it
also helps the finance department to manage the financial statement of the company in such a
manner that it becomes easy for everyone to understand. Logistic department sets an interface
with the Accounting and finance department to manage the activities of the department
through cutting the cost and enhancing the revenue etc.
Order cycle:
Order cycle is a total time period which occurs from the placing of the order till the
next order. Basically, order cycle is the total time period which takes place between the two
orders. The total time period of placing the order and getting the ordered material is known as
order lead time. MPF industry group describe that the order is placed by the company after
considering the total order lead time so that the material could be get by the company before
ending the material in the factory as this could impose huge loss over the company (Miles &

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Snow, 2007). In MPF industry group, order cycle steps have been analyzed which are as
follows:
Steps of order cycle:
a. Placing an order:
This is the primary stage of the order cycle. In this the order is placed by the company
to a supplier after analyzing the cost and many other related factors such as total
distance, quality etc.
b. Receiving the order:
This is the secondary stage of the order cycle. In this the order is received by the
company from the supplier and it is analyzed that if the product is according to the
asked quality of the total cost of the company.
c. Analyzing the order lead time and the EOQ level:
This is the third stage of the order cycle. In this step, the inventory is analyzed by the
managers through applying various techniques and theories and further, the total lead
time is calculated so that the delivery could be got on time (Kovács & Spens, 2005).
d. Place an order again:
This is the last stage of the order cycle. In this step, the order is again placed by the
company to the supplier and it is analyzed that whether the product would be got on
time or not and how would be the quality of the product.

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(Hervani, Helms & Sarkis, 2005)
KPIs:
KPI stands for key performance indicator. MGF industry group has been analyzed and
it has been found that the various key performance indicators are there in the process of the
company to manage and enhance the cost and the revenue of the company. In this report, it as
a production manager, it has been analyzed by me that the entire department of the company
and the performance of the company has became impressive due to the logistic interfaces. It
has been analyzed that the marketing department, production department and the accounting
and finance department are working very well.
How to improve the order cycle:
Through the report and a production manager of the company, it has been analyzed by
me that the order cycle of the company has became more effective and efficient due to recent
techniques and changes. Further, there are some points which are required by the company to
change to make the order cycle more efficient. Company could find the suppliers around the
factory and plant so that the shipping cost of the company could be reduced and the quality
Receivi
ng the order
Analyzin
g the order lead
time and the
EOQ point
Placing an
order
Place
an order
again

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must also be investigated by the company to produce a better product and enhance the
performance of the company (Fawcett, Magnan & McCarter, 2008).
Inventory management:
Inventory management is a practice which looks and controls over the inventory of
the company to managing the inventory through various aspect. It manages the inventory
through ordering the inventory, storage of the inventory, use of the various components etc.
which could be used by the company in the manufacturing and selling the product. It is
required by every company to manage the inventory through analyzing the entire related
aspects. Inventory management is the process of managing the sales quantity and the
production quantity of a business. There are various methods to manage the inventory such as
EOQ, JIT, and MRP etc.
Performance of inventory management:
The study has been conducted over the MRF industry group limited and it has been
found that the inventory management of the company has been improved as company has
implemented various new techniques; some of the points have been analyzed to understand
the performance of the company.
Inventory turnover:
Inventory turnover ratio has been set by the company according to a manner in which
the order cost and the carrying cost of the company is at competitive level and at the same
time only the required inventory could be got by the company at a time. This process is done
after analyzing the various level of inventory and the best level is analyzed according to the
various evaluation techniques in MRP industry group limited (Burgess, Singh & Koroglu,
2006).
Stock out/fill rate:
Stock out/fill rate ratio has been set by the company according to a manner in which
the required inventory of the company is always at the warehouse of the company and at the
same time the out and fill rate has been managed by the company in a manner that the
production level of the company could not affect. This process is done after analyzing the
various level of inventory and the best level is analyzed according to the various evaluation
techniques in MRP industry group limited.

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Life span needs:
Life span needs has been analyzed in the company according to a manner that
operations and the production of the company could not got affect and the production of the
company could run smoothly (Kovács & Spens, 2005). This process is done after analyzing
the various level of inventory and the best level is analyzed according to the various
evaluation techniques in MRP industry group limited.
Obsolete %:
Further, the obsolete % of the inventory level has also been analyzed according to the
scrap of the production and the warehouse. MRF inventory group limited has been analyzed
and it has been found that the inventory management performance of the company is good
(Selviaridis & Spring, 2007).
Recommendation:
Further, it has been found that the company is still required to manage the
performance through the various techniques so that the best inventory level could be
managed by the company. Following are some of the techniques which could be used:
EOQ:
EOQ is economic order quantity which depicts that a fix amount of inventory must be
ordered by the company after a period of time so that the inventory life cycle and the stock
out and fill rate could be managed by the company.
FOP:
FOP is fixed order point which depicts about the fixed units of inventory which must
always in the warehouse of the company to manage any sudden risk.
FOT:
Lastly, FOT technique must also be adopted by the company which depict about the
fixed order time in which the inventory must be placed.
Conclusion:
Through this report, it has been analyzed that the logistic plays an important role in
the life of a manufacturing company. MPF industry group has adopted various strategy and

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policy to manage the production department and thus the profitability of the company has
been enhanced.