How To Run Kalonga Milling
How To Run Kalonga Milling
Executive summary
The economic success of a production firm depends upon their ability to identify the needs of its
customers, to quickly create the subsequent products and to produce them at a low cost.
Achieving these goals is not solely marketing, a design or a production problem, but rather a
management problem involving all of these functions.
Production Management involves the planning, organizing and controlling of the whole
production process. The interrelation of these activities and operations involved in producing the
goods and the services is called a production system.
Introduction
Kalonga Milling is a newly established company situated in central province of Zambia in kabwe
along mukobeko road whose aim is to cut the cost of mealie meal that is used to feed inmates on
behalf of the government. The plant will purchase its raw materials from the prisons farms and
also buy from the farmers. The maize will be transported from the farms by the zps trucks to the
milling plant. In order to produce quality maize meal; Zambia prisons service has erected a
facility for a maize mill and also has completed detailed financial, operational and business
startup planning.
BUSINESS DESCRIPTION
MISSION STATEMENT
To effectively and efficiently provide and maintain humane custodial and correctional services
to inmates and to increase industrial and agricultural production in order to contribute to the
wellbeing and reform of inmates and maintenance of internal security
Business description
BUSINESS NAME
LOCATION
P.O BOX
: 80926, KABWE.
PHONE No.
: 222121 4
FAX
: 223916
TELEFAX
: 81428
BANKERS
BUSINESS LINE
PLAN OF OPERATIONS
The figure below explains the systems aspects of milling production or operations function of the
organization:
OUTPUTS
INPUTS
MEN
MACHINES
MATERIALS
MONEY
METHODS
MANAGEMENT
TRANSFORMATIO
N
FEEDBACK INFORMATION/CONTROL
(CONVERSION)
GOODS
PRODUCED
OR
SERVICES
RENDERED
PROCESS
The organization will receive several inputs as indicated on the left hand side of the above fig.
and converts them into final products which in this case is shown on the right side of the fig.
using available facilities.in the process of conversion, definitely, there will be some deviations in
the products attributes like quality, size and number of units produced.
Just to cope up with the pre-determined plans and policies, it is highly essential to communicate
these deviations to the input stage in the form of feedback for making necessary corrections.
A sample list of corrections is presented below:
MANAGEMENT
Management is one of those words which we all use and which we think we understand until
we are asked exactly what it means.
At its most general, management can be viewed as a process which enables organizations to
achieve their objectives. The inclusion of the word process tells us that something is going
on. Thus, the question, what is management? management is defined us the
accomplishment of desired objectives by establishing an environment favorable to
performance by people operating in organized groups.
It is a truism to claim that people are organizational resources because they are the key in an
industry without which the organization would be unable to deliver any meaningful product.
The management is adequately qualified and has sufficient knowledge of
running a business such as Kalonga Milling Company. In addition, the current
crop of staff at Kalonga Milling Company has relevant knowledge on how to
manage or run the business. This, however, can be achieved if the workforce
is motivated by allowing it perform or operate independently.
The companys management will develop a policy of meeting every after a
specified period of time to plan and review the activities related to the
smooth running of the establishment.
3.2 Day- to-day Operations
In our day-to-day operations we will need the following personnels:
The managing director who will be in charge of seeing the day to day running of the
company.
miller
Production manager
The purchasing officer who is in charge of buying the required materials for the milling
plant
The marketing and sales officer in charge of marketing the products on sale and seeing to
it that sales are conducted in an orderly manner.
The finance officer who is in charge of the funds for the business and is accountable for
all cash flow statements.
The human resource officer who is in charge of the human capital in the company.
Casual workers
Office orderlies who help out in the business.
PRODUCTION
According to the capacity of the plant which is 80 metric tonnes/day (3200 by 25kgs bags), we
are able to produce about 135 * 25kgs bags of mealie meal (3200/24) per hour.
Hence, production per day is 135bags/hour*8 hours=1080*25kgs bags.
CONSUMPTION RATE FOR INMATES
All things being equal, if we are to put the number of inmates at 18000 country wide, then
consumption per day is 18000*0.450=8100kgs/25kgs giving us 324 by 25kgs bags of mealie
meal.
Therefore, consumption per month is equal to 324*30 days=9,720 by 25kgs bags.
Consumption per quarter: 9720*3 months=29,160 bags.
For the year we need about 116,640*25 kgs bags of m/meal.
Total production days/quarter: 29160*25kgs per quarter/1080*25kgs per day= 27 days
This means, we have 4 months of production for the inmates and 8 months of production for the
market in a year.
MAIZE NEEDED FOR THE PLANT TO RUN THE WHOLE YEAR
1000*50kgs bags of maize is required to produce about 1600 *25kgs of mealie meal.
Hence, in a quarter we need about 18225*50kgs bags of maize. The total number of bags of
maize required for the inmates in a year is 72,900 *50kgs bags
For the public, we need 675 by 50kgs bags *20 days*8hrs=108,000 by 50kgs bags of maize
Total bags needed: 108,000 +72900=180,900 approx. =181,000 *50kgs bags of maize.
Competitive Advantage
Kalonga milling intends to take advantage of being a government entity by bidding to handle all
government institutions that are in need of mealie meal. These institutions could be the Zambia
army, Zambia air-force, Zambia National Service, Zambia police, government schools, hospitals
etc.
iii. Market Characteristics
Zambia in general - Maize meal is the staple diet of Southern and Eastern Africa. An average
adult in Zambia will consume around 120kg of maize meal per year (Chapoto & Jayne, 2006.)
Most Zambians, will eat maize meal porridge for breakfast lunch and dinner with various side
dishes. In rural parts of Zambia, such that surrounds kabwe, a bag of maize meal means food
security for an average family for two weeks and is their first priority when receiving a salary.
In view of the above we recommend that we run promotions for our products
by way of coming up with a competition, say if one buys 5 by 25kg bags of
breakfast meal such a person shall be entitled to a free 10kg bag of
breakfast.
1.2.4 Pricing
Price stands for the amount of money that a customer has to pay for a
product, this may also include the provision of price list, discounts,
allowances, payment periods and credit terms. In achieving this, as Kalonga
Milling we need to be flexible as we set prices for our products. What we
should bear in our minds as Kalonga Milling Company is that we are a new
player or entrant into the market. We therefore, recommend the market
penetration pricing policy. This policy is a policy of low prices when the
product is first being launched to the market so as to gain sufficient
penetration into the market.
It is a decision making model which help managers to analyze the strengths, weaknesses,
opportunities and threats of a business or given situation. Based on the analysis managers are
able to make sound decisions. Below is the analysis for Kalonga Milling Plant.
SWOT ANALYSIS
STRENGTH
Government support
Excess capacity than internal market
WEAKNESSES
New in the Milling Industry.
Weaker brand name.
( Inmates)
experienced manpower.
Able to increase product lines.
OPPORTUNITIES
Comparative advantage to supply
government institutions.
Potential to penetrate big supermarkets
like Shoprite and Spar.
THREATS
Existing players in the Milling Industry
Political interference sometimes could
be negative to the business.