VRL LOGISTIC LIMITED, HUBBALLI

EXECUTIVE SUMMARY

The purpose of this project is to study and understand the organization as whole
and to know how exactly the various departments function in an organization.
It is also stimulates and helps to understand the work environment better. The
study assesses the performance of organization and examines the changes in
environment. It gives a picture about industry structure, Players in the market,
the industry volume and the current scenario of this industry around the world
and in India.

The project gives brief overview of the VRL Logistics Limited Company
Organization profile is important to divide departments so that work can divided
into units and division. The various departments of VRL Logistics Limited
Company such as Human Resource, Finance, Research & Development etc.

The study has a few good methodologies, to study different essentials of VRL
Logistics Limited Company such as SWOT ( Strength, Weakness, Opportunity,
and Threats ). The report provides an introduction to practices policy presenting
an overview of this industry. The first chapter of this report deals with
organization profile background of the company, nature of business and vision,
mission, quality policy of the company, it also defines the various function
carried out by the departments in company. The third chapter is about McKinsey
framework is tool that analyze firm’s organizational design by looking at 7 key
internal elements : Strategy, Structure, System, Shared values, Style, Staff &
Skills in order to identify if they are effectively allinged and allow organization
to achieve it’s objectives.

The fourth chapter is SWOT Analysis of company to check the organization and
its environment on the basis of strength, weakness, opportunities and threats of
the company.The fifth chapter is about analysis of financial statement of
previous years to understand the financial position of the company and it’s
competencies of past years. And the final chapter deals about

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learningexperience which was gained from this one-month internship training

in VRL Logistics Limited Company.

CHAPTER 01

INTRODUCTION ABOUT THE ORGANISATION AND

INDUSTRY.

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1.1 Introduction of organization:

Founded in 1976 by Mr. Vijay Sankeshwar Gadag , a small town in North

Karnataka with a single truck and vision that was way ahead of its time. VRL
soon expanded its service to Bangalore, Hubli and Belgaum. From this humble
beginning VRL has grown into a nationally renowned logistics and transport
company which is currently the largest fleet owner in India with a fleet of 2691
Vehicles (including 196 hi-tech tourist buses and 2495 Trucks) as of 15th August
2008 published in the Limca Book of Records.

Over the year VRL has pioneered in providing a safe reliable delivery network
in the field of parcel service. It has spread its operations to Courier Service,
Express Cargo & Aviation to meet the growing demand of buregeoning
customer base.

3PL & Warehousing solutions offered by VRL are tailor-made and cater to
unique needs of various customers of the industry. With the largest network in
India, the VRL parcel service is indispensiable for the large number of corporate
houses. This network spans the length and breadth of country and is supported
by large number of transshipment hubs. VRL operates through a network of
2629 Locations and 911 Branches, franchisees and our valuable customers.
VRL is now expanding its service to reach even the remote locations of the
country.

The efficiency of our fleet of vehicles hinges on our all inclusive state-of-the-
art workshop cum service complex at Hubli (Karnataka). Every vehicle of our
fleet passes through this master service facility so that they are at peak levels of
performance, leading to better cost efficiencies and time management.

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Hubballi Head Office:

Established: 1976

Name of the
organization: VRL Logistics LTD

. Date of incorporation: 31 march 1983

Owner: Vijay Sankeshwar

Location: NH 4 Bangalore Road

Registration number: 5247

Company: LIMITED Company

Head office: Hubali

Employees: Above 5000 employees

Area covered by VRL: 43 acres

Brand Name: VRL

Class of company: Public

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Email: [email protected]

Website: https://www.vrlgroup.in

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CHAPTER -02

COMPANY PROFILE

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2.1 History of Company

VRL Logistics Limited (formerly Vijayanand Roadlines Ltd.), commonly

known as the VRL Group, is an Indian conglomerate headquartered in Hubballi,
Karnataka, India with operations in around 23 states and 4 union territories in
the country. Business operations of VRL Group include road transportation,
logistics, publishing etc.VRL Group is one of the large logistics and transport
companies in India (incl.4360vehicles,[4] comprising 419 tourist buses and
3941 transport goods vehicles).Limca Book of Records, mentioned it as the
single largest fleet owner of commercial vehicles in the country's private sector.

 VRL Logistics Limited

Business Type Transportation And Logistics

Founded 1976, 47 years ago in Gadag

Karnataka, India

Founder Vijay Sankeshwar.

Headquarters Hubballi, Karnataka, India.

Area served India.

Key People Vijay Sankeshwar, Anand Sankeshwar

Chairman and Managing Diretor.
Revenue ₹2,663 Crore ( US $330 Million)
(2023)
Operating Income ₹ 401 Crore (US $50 Million) (2023)

Net Income ₹ 323 Crore ( US $40 Million) (2023)

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Total Equity ₹ 976 Crore (US $120 Million) (2023)

Owner Vijay Sankeshwar

Website www.vrlgroup.in

GSTIN 29AABCV3609C1ZJ

Telephone No. 18009 7800

 History
VRL Group was founded by Vijay Sankeshwar in 1976 at Gadag, Karnataka,
India. His family had a publication house, which later became a part of VRL
Group.

 Headquarters and offices

VRL is headquartered in Hubballi, Karnataka and has 931 branches, 40 hub and
transport yards across the country. The headquarters has effluent treatment plant
(capacity:175 thousand liters),rainwater harvesting plant, petrol bunk (allotted
by Indian Oil Operating income Corporation), and a garage service complex,
where VRL’s trucks passes through in the fleet, once in every two weeks.

 Cargo and Courier

A subsidiary of VRL Group, VRL General Cargo started its business service as
transportation between Hubballi and Gadag, and later has spread across
Bengaluru and Belagavi. It has extended into courier services and express cargo,
which are now operative in 23 states, handling over 216 million cargos/year,[10]
being one of the large networks in the country. Its courier services are operative
for parcels ranging from small to large size.

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 Travel
VRL's public tour business is operated by its division Vijayanand Travels. With
having more than 80 branches, and operated by 1000+ agents, it is the largest in
tour business services in Karnataka and Maharashtra. It owns 1550 buses
(incl.742 Volvo buses of 9400 XL and 9400PX multi-axle models), covering
six states, moving across 350 routes in the country.

 Aviation logistics
VRL Logistics Ltd. in 2008, started working in Indian Air Chartering Industry,
operating under the Indian Air Operator permit (for passenger charter). In the
first phase of its business, it owned a Beechcraft Premier I, an aircraft,
manufactured by Hawker Beechcraft Inc, United States, while in 2013 it
purchased another. It offers Jet aircraft charters to sectors like corporate, leisure
and tourism, special missions, event management, advertisement agencies and
for flights (VIP category).

 Media
VRL Group's flagship entity, Vijayavani was started on 1 April 2011, which is
now the largest circulated newspaper[12] in Karnataka. VRL Group's subsidiary
company VRL Media Ltd., prints Vijayavani and is published in 9 cities of the
state. Vijayavani’s lead editor of its editorial division is Chennegowder and
Subhash hoogar. Karnataka's second largest circulated newspaper Vijaya
Karnataka, was started by Vijay Sankeshwar (of VRL Group) in October 2000,
and was sold to the Times group on 16 June 2006. In April 2017, VRL Media
Ltd. Started Dighvijaya News 24x7, a Kannada television news channel.

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2.2 Nature Of Business

VRL Logistics Limited operates as logistics and transport company in India and
internationally. It offers services for transportation of goods using a range of
road transportation solutions, including less than full truck load and provides
courier services for the transportation of small parcels and documents through
the multi-model solutions.
Logistic Solutions : We move consignments of varying size and weight
across the country.

Courier Service : We offer courier service within state of Karanataka

Full Truckload Services: We provide FTL Service to our customers and provide
door to door FTL service.

 BUSINESS STATMENT

VRL Logistics Ltd is a leading logistics company that specializes in providing

transportation and logistics solutions. With strong focus on customer
satisfaction, VRL Logistics strives to deliver reliable and efficient service to
meet the diverse needs of its clients.The company’s commitment to excellence
coupled its extensive network and advanced technology, positions VRL
Logistics as a trusted partner in the logistics industry.

2.3 VISION, MISSION & QUALITY POLICY

2.3.1 VISION:

To become the premier company that cuts across various segements and
emerges as the torchbearer of each segment that it ventures into.

2.3.2 MISSION:

 To provide the highest quality service to our customers by

continuously increasing cost efficiency and maintain delivery
deadlines.

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 To encourage our workforce to continuously strive for quality and

excellence in everything they do.
 To promote team work and create work environment that encourages
talent and brings out best in our employees.

2.3.3 QUALITY POLICY

We are committed to provide quality logistics services consistently at

reasonable price and to continually improve the same to achieve
customers delight on a sustainable basis.

2.4 WORK FLOW MODEL

Order Placement

Order Processing

Resource Allocation

Transportation

Warehousing

Inventory Management

Delivery

Customer Feedbck

1.ORDER PLACEMENT :

Costumers place orders for transportation or logistics services. Order placement

is the process of initiating a purchase order for goods or services in the

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procurement process. It typically involves identifying the need for a product or

service, sourcing potential suppliers, negotiating terms and pricing, and issuing
a purchase order to the selected supplier.

2.ORDER PROCESSING:

VRL Logistics receives and processes the orders, verifying the details and
requirements. Order processing is fulfilling a customer’s request for goods or
services. In order processing, suppliers accept the orders, then deliver the
products to customers. The suppliers receive and verify the order, select the
products or services, and ensure that they are delivered to the customer promptly
and accurately.

3. RESOURCE ALLOCATION

The necessary resources such as vehicles, drivers and equipment are allocated based
on order specification. Resource allocation is the process of identifying all your
available resources—whether it’s labor or monetary—for a project and then
strategically assigning them to tasks that enable them to do their best work.

4. TRANSPORTATION

Goods are picked up from origin location and transported to the designated destination,
following most efficient routes. Transportation in a supply chain refers to the
movement of products from one location to another, which begins at the start of
the supply chain as materials make their way to the warehouse and continues all
the way to the end user with the customer’s order delivered at the doorstep.

5. WAREHOUSING

If required VRL Logistics may store the goods in their warehouses for
temporary period. Warehousing is the process of storing physical inventory for
sale or distribution. Warehouses are used by all different types of businesses
that need to temporarily store products in bulk before either shipping them to
other locations or individually to end consumers.

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6. INVENTORY MANAGEMENT

The inventory is tracked and managed to ensure accurate stock levels and
efficient order fulfillment. Inventory management, a critical element of the
supply chain, is the tracking of inventory from manufacturers to warehouses and
from these facilities to a point of sale. The goal of inventory management is to
have the right products in the right place at the right time.

7. DELIVERY

The goods are delivered to customers specified location, ensuring timely and
secure delivery. The process of delivering goods or services. Supply chain
management is concerned with the flow of materials and services, including
delivery to the ultimate customer, as well as the associated flows of money and
information.

8. CUSTOMER FEEDBACK

VRL Logistics values customer feedback to continuously improve their

services and address any concerns. To achieve optimal performance, SCM
requires constant feedback and evaluation of the various aspects of the supply
chain, such as demand, inventory, quality, delivery, costs, and customer
satisfaction. Feedback is the information that indicates how well the supply
chain is meeting its objectives and expectations.

2.5 PRODUCT / SERVICE PROFILE

1) VRL Express Cargo:

“Anywhere Anytime”

 Delivery on time zero excuses. This mantra is driving force behind the
success of VRL Express Cargo.
 Surface, Train and Cargo mode services.
 Dedicated company owned vehicles

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 Door pick up and delivery.

 On time delivery.
 Online track and trace facility
 24*365 days operations
 Dedicated and well groomed customer care windows.

2. VRL COURIER SERVICE:

“On Time Every Time”

Capitalising on the synergy of our transport network that connects all over
Karnataka, we areinto Courier Services focusing on delivering documents and
small parcels in a time

 Bound manner
 Strong & Dedicated Operating Team.
 Time Bound Delivery With An Emphasis “On Time Every Time”
 Delivery Schedules ranging From 24/48/72/96 hours.
 Dedicated Route Vehicles.
 Online Track and Trace Facility.

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3.Warehousing & 3PL Solutions:

“Tailor-Made Multi-Locational Service”

Seamless logist ics solut ions organisat ion encompassing various com
ponents like supplychain management, inventory control management,
warehousing management, JIT movementwith an emphasis on CRM.

 Integrated 3pl solution.

 Inventory Management.
 Warehousing facility at various locations.
 Communication & IT service.
 Intra-city & re-distribution services.
 SKU management
 Order management.
 Vendor management.

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4.Vijayanand Travels

“At the forefront of passenger Transport”

200Plus routes covering more than 50 destinations every day. Market leader in
Karnataka in private tourist operator segment.Areas of Operation : Karnataka &
Maharastra states with 60-plus branches and wide-spread network of 1000-plus
agents. Vijayanand Travels is the premier operator to extend service
by hi-tech & sleeper coaches even to remote places.

 Onwards & return journey booking facility.

 Punctuality in timing and separate seating arrangement for ladies.
 Well-maintained coaches with latest seating arrangement.
 Double drivers on-board for safe & comfortable journey.
 Relief bus facility on all routes in case of any unforeseen incidents

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Vijayanand Travels, the tour operation division of VRL, is the market leader
among tourist bus operators in Karnataka and Maharastra. It operates a huge
fleet of buses on more than200 routes and is supported by a network of 60
branches and 1000 agents. It has pioneeredthe introduction of Hi-Tech buses on
routes leading to remote parts of Karnataka, separateseating arrangements for
women on board, a choice of buses from ordinary buses to super luxury A/C
buses, check point to monitor vehicle movement, two drivers on the buses
to prevent driver fatigue on long routes and enhance passenger safety and E-
ticketing facility too.

4.Online Ticket Booking

VRL Online Ticket booking is Secured Fast And easy way to reach your
destination.Please check your exact Bus schedule & Fare for your date/place of
travel.Please refer to terms & conditions for further details on bookings.The
lowest price does not always mean the best deal.

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5.VRL Aviation :

From the taemac to the skies VRL has set off new journey. In primary phase,
VRL has acquired a brand new, Permier Jet 1A aircraft, manufactured by
Hawker Beechcraft Corporation , USA. It will offer luxurious comfort and the
freedom to fly at a whim. This coupled with legendary VRL lineage, this venture
will certainly touch the skies.

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2.6 OWNERSHIP PATTERN:

VRL Logistics is one of the front runners in Indian Passenger Travel Industry
amongst private sector players.It is managed by following promoters.

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Board of Director

Name
Designation

Dr. Vijay Sankeshwar

Chairman & Managing
Director

Dr. Anand Pandurangi

Independent director

Mr .shankarasa ladwa
Independent director

Mr. J S korlahalli
Independent director

Mr. C Karunakara Shetty

Independent director

Dr. prabhakara Kore

Independent director

Mrs. Medha Pawar

Independent director

Mr. Anand Sankeshwar

Managing Director

Mr. Raghottam Akamanachi

Non Executive Director

Mr. Ashok Shettar

Non Executive Director

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Mr. K N Umesh
Whole time Director

Mr. L R Bhat
Whole time Director

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2.6.1 Organization Structure

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3.7 ACHIEVEMENT / AWARD

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2.8 THE FUTURE GROWTH

 INDUSTRY STRUCTURE AND DEVELOPMENTS

The Logistics industry is crucial for the efficient movement of products and
services across the nation and in the global markets. The logistics business is
highly fragmented and has innumerable participants, including major local
players, worldwide industry leaders, the government postal service, and rising
start-ups that focus on e-commerce delivery.

The industry includes transportation, warehousing, and value-added services

like packaging, labelling, and inventory management. With the advent of
technology-driven solutions such as transportation management systems (TMS)
and warehouse management systems, India's logistics industry has witnessed
tremendous development in recent years (WMS). These solutions have assisted
logistics firms in increasing operational efficiency, lowering costs, and
improving customer service. (Source : India Brand Equity
Foundation).Advancements in digital technologies, changing consumer
preferences due to e-commerce, government reforms, and shift in service
sourcing strategies are expected to lead the transformation of the Indian logistics
ecosystem. Digitalization will improve the efficiency and performance in
freight management and port operations. Warehouse automation will help
achieve operational efficiencies to counter supply-chain cost pressures in the
industry. Increased investment in infrastructure, last-mileconnectivity, and
emerging technologies are streamlining the logistics landscape in India.

As per Summary of Economic survey 2022-23, issued by the Ministry of

Finance, The Indian economy is expected to grow over 7 per cent in the current
financial year 2023-24. Strong growth supported by government reforms,
transportation sector development plans, growing retail sales, and e-commerce
sector are likely to be the key drivers of the logistics industry in India.

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Manufacturing in India holds the potential to contribute up to 25%–30% of the

GDP by 2025 which will drive the growth of the transportation segment in India.
As per India Brand Equity Foundation report on Warehousing and Logistcs
sector in India, The logistics sector represents five percent of India’s Gross
Domestic Product and is predicted to account for 14.4% of the GDP. Adding to
the growth are the new policies that are set to give the industry a much-needed
push. Improving efficiency of the logistics sector is of high importance for the
country’s economy as it boosts economic growth, grows exports through global
supply chains and generates employment. Logistics are fundamental part of
business infrastructure and one of the key enablers in the global supply chain.
The impetus given by the government to build the infrastructure in the recent
budget is the biggest positive for the logistics sector.

The Logistics sector in India currently employs 22 million people and serves as
the backbone for various businesses. The logistics sector in India was valued at
US$ 250 billion in 2021, with the market predicted to increase to an astounding
US$ 380 billion by 2025, at a healthy 10%-12% year-on-year growth rate.
Moreover, the government is planning to reduce the logistics and supply chain
cost in India from 13-14% to 10% of the GDP as per industry standards.

The logistics market in India is forecasted to grow at a CAGR of 10.5% between

2019 and 2025. It has been awarded infrastructure status which has made it
easier for investment inflows and has become a major growth driver of the
logistics industry. Increasing investments and trade points toward a healthy
outlook for the Indian freight sector. Grant of infrastructure status to logistics,
the introduction of the E-Way Bill, E-Invoice and GST implementation are set
to streamline the logistics sector in India. Setting up of a logistics division under
the Department of Commerce, technology upgrades, and development of
dedicated freight corridors and logistics parks are also major moves to upgrade
the logistics landscape.

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As per Ernst & Young report on ‘Envisioning the future of Indian

logistics@2047, India’s freight movement is heavily skewed toward road
transportation, which moves 66% of cargo (in ton-km). This is followed by rail
(31%), shipping (3%) and air (1%). To aid this cargo movement, India has an
extensive network of support infrastructure comprising 129+ In-land container
depots, 168+ container freight station, and ~300 mn. sq. ft. of warehousing
space. The sector handles ~10,000 commodities and employs ~22m people. It
is one of the highly fragmented sectors, with only 10% of the sector operated
by organized players.

 SOURCE
Ernst & Young, PBI, Ministry of shipping, Ministry of civil aviation, Niti
Aayog VRL Logistics Limited 68 40th Annual Report 2022-23.

This uneven distribution of modes of transportation has led to prompting the

GOI to undertake multiple logistics specific initiatives, such as Gati-Shakti,
National Logistics Policy and others. These programs aim to streamline India’s
logistics sector by making it more green, agile, transparent and integrated. India
aims to reduce logistics cost from 13% to 14% of GDP, to 8% to 10% of GDP,
by 2030.
The GOI has launched several programs with a focus on building new
roads, railways, ports infrastructure, etc.
This is complimented with measures to attract private capital and implement
administrative reforms to streamline processes for planning and executing

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infrastructure investments. GatiShakti is a critical component of this strategy,

which aims to integrate planning and implementation of infrastructure projects.
As a result, programs such as Bharatmala, Dedicated freight corridor and
Sagarmala were developed. Several Multi Modal Logistics Parks (MMLPs) are
being developed to connect multiple modes of transport. The average speed of
road development has increased from 20.79 km/day in FY22 to 22.23 km/ day
till Jan-23.

 E-tolling:
In order to ensure seamless movement of traffic through fee plazas and increase
transparency in collection of user fee using FASTag, the National Electronic
Toll Collection (NETC) programme, the flagship initiative of Ministry of Road
Transport and Highways, has been implemented on pan India basis. The
National Payment Corporation of India (NPCI) is the Central Clearing House
(CCH). There are thirty eight (38) banks (including Public and Private sector
banks) engaged as issuer banks for FASTag issuance to road users and fourteen
(14) acquirer banks to process the transactions at fee plazas.

Efforts are on to to start a GPS-based toll system in place of FASTag to ensure

seamless payment and vehicle movement on national highways. Under GPS-
based tolling, vehicles will need to be fitted with a device that can track its
movement on the highways. Once such a vehicle enters a tolled road, a highway
system would track the vehicle and toll will be charged base on the distance
travelled at the exit point the highway.

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CHAPTER -03

McKENSY’S 7S FRAMEWORK AND PORTER’S FIVE

FORCE MODEL WITH SPECIAL REFERENCE TO
ORGANIZATION UNDER STUDY

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 The McKinsey 7S Model refers to a tool that analyzes a company’s

“organizational design.” The goal of the model is to depict how effectiveness
can be achieved in an organization through the interactions of seven key
elements – Structure, Strategy, Skill, System, Shared Values, Style, and Staff.

The focus of the McKinsey 7s Model lies in the interconnectedness of the

elements that are categorized by “Soft Ss” and “Hard Ss” – implying that a
domino effect exists when changing one element in order to maintain an
effective balance. Placing “Shared Values” as the “center” reflects the crucial

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nature of the impact of changes in founder values on all other elements.

 Structure of the McKinsey 7S Model

Structure, Strategy, and Systems collectively account for the “Hard Ss”
elements, whereas the remaining are considered “Soft Ss.”

1. Structure
Structure is the way in which a company is organized – the chain of command
and accountability relationships that form its organizational chart.

2. Strategy
Strategy refers to a well-curated business plan that allows the company to
formulate a plan of action to achieve a sustainable competitive advantage,
reinforced by the company’s mission and values.

3. Systems
Systems entail the business and technical infrastructure of the company that
establishes workflows and the chain of decision-making.

4. Skills
Skills form the capabilities and competencies of a company that enables its
employees to achieve its objectives.

5. Style
The attitude of senior employees in a company establishes a code of conduct
through their ways of interactions and symbolic decision-making, which forms
the management style of its leaders.

6. Staff

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Staff involves talent management and all human resources related to company
decisions, such as training, recruiting, and rewards system.

7. Shared Values
The mission, objectives, and values form the foundation of every organization
and play an important role in aligning all key elements to maintain an effective
organizational design."

2.1 Mckinsey 7S Framework to Analyze VRL Logistics Ltd

1. Strategy

VRL Logistics Ltd needs to build a balance between short run cost savings and
protecting its core competitive advantage. Customers perceive VRL Logistics
Ltd products and services to deliver ‘value for money’ proposition plus a bit
extra. In its zest to gain more market share through competing on prices, VRL
Logistics Ltd should avoid cutting costs that can result in inferior product and
service delivery.

2. Structure

The pandemic has questioned the current structure and supply chain
management of the company. To be more resilient organization and prepare
itself for future disruption of similar magnitudes VRL Logistics Ltd should
focus on – diversifying suppliers geographically so that climate related,
geopolitical, and other disruption. Reduce the dependence on China – As the
trade war between US and China is getting aggressive, it should reduce its
dependence on supply chain emerging out of China. This will help the
organization to diversify risks, avoid regulatory problems etc. To achieve the
above two goals – VRL Logistics Ltd needs to fine tune its organization

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structure. It needs to have smaller teams, easy reporting to the headquarters, and
enabling teams to take decisions based on real time developments.

3. Systems

VRL Logistics Ltd needs to focus on the following areas – Improve internal
processes, such as risk management, Customer Relationship Management
(CRM), web app optimization, and data visualization across the organization.
VRL Logistics Ltd needs to put in place robust system for “work from home”
employees so that there can be greater interaction among the employees both
online and in physical environment. It will not only improve productivity but
also increase the data security and cyber security.

4. Staff

Some of the steps VRL Logistics Ltd can take in to improve the human
resources are –
Recruitment and remote onboarding – Because of the pandemic, a lot of
employees are working from remote locations. To make the environment more
inclusive for the new employees, VRL Logistics Ltd should build system for
remote onboarding such as – catalog of short videos, small groups interaction,
technical demonstrations.

Open chats for the people to approach people at various levels in the hierarchy.
It will not only help the top management to directly interact with the people
below but also help in building an open and transparent culture.

5. Skills

VRL Logistics Ltd can build a structured training and development program for
people working from remote locations. VRL Logistics Ltd can hire fresh talent
as more and more people are leaving their existing jobs because they are not
challenging them enough.

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6. Style / Leadership Style & Culture

The leadership styles required in the physical location and in remote scenario
are completely different. In a physical environment manager can stop by a chat,
provide inputs and go through the work. But in the remote locations employees
have to work in far more isolated environment. To improve the workflow –
leaders should pursue collaborative and inclusive form of leadership. Leaders
should build smaller teams as part of larger team.

2.2 PORTER’S FIVE FORCE MODEL:

The tool was created by Harvard Business School professor Michael Porter.
Since its publication in 1979, it has become one of the most popular .

Porter Five Forces that Determine Trucking Industry Structure

The Porter Five Forces that determine the industry structure in Trucking are -

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1. Threat of substitute products and services in Trucking sector –

If the threat of substitute is high then VRL Logistics Ltd has to either
continuously invest into R&D or it risks losing out to disruptors in the
industry.

2. Threat of new entrants in Trucking industry –

If there is strong threat of new entrants in the Trucking industry then current
players will be willing to earn lower profits to reduce the threats from new
players.

3. Rivalry among existing players in Trucking industry –

If competition is intense then it becomes difficult for existing players such as
VRL Logistics Ltd to earn sustainable profits.

4. Bargaining power of suppliers in Trucking –

If suppliers have strong bargaining power then they will extract higher price
from the VRL Logistics Ltd. It will impact the potential of VRL Logistics Ltd.

5. Bargaining power of buyers of VRL Logistics Ltd and Transportation

sector –
If the buyers have strong bargaining power then they usually tend to drive
price down thus limiting the potential of the VRL Logistics Ltd to earn
sustainable profits

 Porter Five Forces importance for analysis of VRL Logistics

Ltd
Managers can use Porter Five Forces model to analyze the competitiveness
faced by VRL Logistics Ltd in Trucking industry. Porter five forces analysis of

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VRL Logistics Ltd will help in understanding and providing solution to – nature
& level of competition, and how VRL Logistics Ltd can cope with competition.
Even though from outside various industries seem extremely different but
analyzed closely these five forces determines the drivers of profitability in each
industry. (Managers can use Porter Five Forces to understand key drivers of
profitability of VRL Logistics Ltd in Trucking industry.

 Michael Porter’s 5-Forces Analysis

1. Barriers of Entry •
 Huge capital investment: The asset-intensive model requires a high
amount of capital along with the cost incurred during the replacement of
assets. Moreover, depending on 3rd party vehicles is always a less
preferred solution as certain key benefits are lost.

 Government regulations: Buses and trucks require permits and

approvals from both State and Central Governments for smoother
movement. Regulations often change which can make it difficult for small
truck operators to adapt and adhere to.

 Land: Any company that is planning to set up facilities in major cities in

the coming years would require acres of land. The land is already
expensive in these cities and companies need a large piece of land in
permissible limits. This can further increase the capital required.

2. Bargaining Power of Suppliers

 Labour and Drivers: Transport and logistics business is highly dependent
on labour and drivers, who are well trained and are willing to travel over
long distances. Also, they are prone to accidents on-site or during travel,
since not everyone is willing to work under such conditions their bargaining

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power is high. Formation of trade unions can further strengthen the power
of labour especially in decisions related to compensation or wage hikes.

3. Bargaining Power of Buyers

 Less Competition: Goods Transport industry has very few players in the
organized sector that own a sufficiently large network that can cover long
distances and achieve economies of scale. Further, very few players have
the capability to carry various types of commodities in terms of vehicle
design. Since only large players can provide better service at a competitive
price, it weakens the power of the customers in the goods transport business.

 Online Ticketing: Bus operations division has significant competition due

to the presence of a large number of state-run operators and private players.
Due to increased usage of online booking websites allowing comparison
between service providers, buyers tend to have a higher bargaining power.

4. Rivalry among Competitors

 Fragmented Market: The market is fragmented with a large number of
players in the unorganized sector making it difficult to achieve
leadership in all locations or routes. About 70% of the players own less
than 5 trucks. Moreover, small players can easily dominate local
markets.

 Start-ups: Most start-ups are set to capture the market share using an
aggressive pricing strategy even at the expense of profitability.
However, large players have an advantage due to their network and
diverse customer base spread across different locations and industries.

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 New Entrants: Indigo a low-cost air travel provider has increased the
frequency of its charter air service from June 2020 which was earlier
restricted to very few trips a month this can drastically increase
competition in the industry. Because for Indigo, Air Travel is the
primary focus.

5. Threat from Substitutes
 Railways: Even though railways are a cheaper mode of goods transport with
a lower cost per tonne due to low fuel consumption and also time saving,
roadways are preferred as they have better connectivity even to the remotest
places and can travel over any terrain.

 Flexibility: For passenger travel, availing tickets in trains require advance

booking, and even though air travel tickets can be booked at the end moment
they are too expensive. Buses tend to solve both these issues; they don’t
require advance booking and are comparatively cheaper. However, since
buses are suitable for short distance travel only both railways (cost-saving)
and airways (time-saving) still pose a significant threat for the roadways.

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CHAPTER-04

SWOT ANALYSIS

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SWOT Analysis

1.Strengths:

 Investors with long term vision dictates VRL logistics shareholdings

 There is study increase in the growth of their turnover.
 They provide goods service that leads to customer satisfaction
 The company is recommended by Indian books association Mumbai
 The company is having wide network of branches spread
all over Karnataka, Andhra Pradesh, Madhya Pradesh,
Maharashtra and new Delhi.
 They have entered into tourist transport operations
 They luxury bus service have been extended to Banglore,
Mumbai, Bagalkot and Mangalore and restother part of Karnataka
 They have their own in house body building of vehicles

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2.Weakness :

 Very limited staff

 Dependent on economic scenario
 Less commission structure
 Low advertisements as compared to competitors
 Bureaucracy
 There is a heavy work load.

3. Opportunities:

 They can extent their service to north and south stations

 They can enter into international courier and cargo express service
 They can tie-up the government transport agencies
 Provide employment opportunity
 Private domestic air services
 Extending the service.

4.Threats:

 Competitors can compete for market leadership

 Economic slowdown
 New technology
 Government regulations

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CHAPTER-05

ANALYSIS OF FINANCIAL STATMENT

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 Financial Management

Financial management is concerned with the overall decision making in

general and with the management of economic resources in particular. In
other words it can be define as the management of cash and fund flow which
deals with financial decision making of firm.

‘Management of fund’ is an important aspect of financial management. In a

business undertaking or in an educational institution or in a hospital or in an
art society or elsewhere management of fund is the primary concern of the
financial management.

 TECHNIQUES OF FINANCIAL STATEMENT ANALYSIS:

Financial analyst analyzes the financial statement by selecting the

appropriate techniques according to the purpose of analysis. We can analyze
the financial statement from the following techniques.

 Comparative statement
 Common-size statement
 Trend Analysis
 Ratio Analysis
 Fund flow statements
 Cash flow statements
 Cost volume profit Analysis

1. Comparative Statements:

The comparative statements are the statement of the financial position at

different periods of times the elements of financial position at two or more
periods. Any statements prepared in a comparative from will be covered in
comparative statement.

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2. Common-Size Statements:

The common size statement, balance sheet and income statement are shown
in analytical percentages. The figures are shown as percentages of total
assets, total liabilities and total sales a statements in which balance sheet
items are expressed as the ratio of each asset to total assets and the ratio of
each liability is expressed as a ratio liabilities is called common size balance
sheet.

3. Trend Analysis:

The financial statement may be analyzed by computing trend of information.

This Method determines the direction upwards or downwards and involves
the computation of the percentage relationship that each statement item
bears to the same items in base year.

4. Ratio analysis:

A ratio is defined as the indicated quotient of two mathematical expression

and as the relationship between two quantitative term between figures which
have a cause and effect relationship or which are connected with each other
in same manner or the other. A noticeable point is that a ratio reflecting a
quantitative relationship helps to perform a quantitative judgment. Such as
the nature of all financial ratios. Ratio analysis is a widely used technique.

5. Fund Flow Statements:

The fund flow statement is a statement which shows the movement of funds
and is a report of the financial operations of the business undertaking. It
indicates various means by which funds were obtained during a particular
period and the ways in which these funds were employed.

6. Cash flow statement:

Cash flow statement which describes the inflows and outflow of cash and
cash equivalent in an enterprise during a specified period of time. Such a
statement enumerates net erects of the various business transaction on cash.

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7. Cost volume profit analysis:

Cost volume profit analysis is a systematic method of examining the

relationships between selling prices, total sales revenue, and volume of
production, expenses and profit.

 RATIO ANALYSIS:

Ratio Analysis can be defined as the study and interpretation of relationship

between various financial variables, by investors or lenders. It is a
quantitative investment technique used for comparing a company’s financial
performance to the marketing general. It helps to identify areas where the
management needs to change.

Financial ratio analysis is the calculation and comparison of ratios which are
derived from the information in a company’s financial statements. Financial
ratios are calculated from one or more pieces of information from a
company’s financial statements.

Classification of Ratio: Ratio can be classified into different categories

depending upon the basis of classification. The traditional classification has
been on the basis of the financial statement to which the determinants of a
ratio belong. On the basis the ratio could be classified as,

 Profit and loss account Rate

 Balance sheet Ratio
 Composite Ratio

However the above basis of classification has been found to be crude and
unsuitable because analysis of balance sheet and income statement cannot be
done in isolation. They have to be studied together in order to determine the
profitability and solvency of the business. They are now classified as:

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1. Financial ratio:

a) Liquidity ratio

 Current ratio
 Quick ratio
 Absolute liquidity ratio
 Working capital ratio

b) Capital structure ratio

 Debt ratio
 Debt equity ratio
 Proprietary ratio
 Interest coverage ratio

2. Turnover ratio:

 Inventory turnover ratio

 Debtor turnover ratio
 Creditor turnover ratio
 Asset turnover ratio

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1. Net Asset Turnover:

Year Net Sales Net assets Turnover

Ratio

2018-19 64202.81 58304.54 1.10

2019-20 70598.93 55016.45 1.28

2020-21 88196.68 62054.14 1.42

2021-22 112112.34 57550.08 1.95

Net sales.

Net asset turnover ratio = -------------------------

Net Assets

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Net turnover
1.2 ratio
5

1.
2

1.1
5

1.
1 Net turnover
ratio
1.0
5

0.9
5 2018- 2019- 2020- 2021-
19119 20 21 22

 Interpretation:
The trend is showing increment i.e. net asset turnover ratio in 2021-22 is 1.92
times comparing to 1.42 time in 2020-21. Therefore it indicates that the
company producing 1.95 time of sales for one rupee of capital employed in
net assets.

2.Total asset turnover ratio :

This ratio shows the firm’s ability in generating sales from all financial
resources committed to total assets

Total asset turnover = (Sales)/( Total assets)

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(Total assets include net fixed assets and current asset)

Year sales Total assets Total assets

turnover
2018-19 64202.81 61690.53 1.04

2019-20 70598.93 64319 1.15

2020-21 88196.68 72906.42 1.20

2021-22 112112.34 92858.43 1.21

2021-22 112112.34 92858.43 1.21

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Total asset turnover

1.25 ratio
1.2

1.15

1.1
Total asset turnover
ratio
1.05

0.95
2018- 2019- 2020- 2021-
19 20 21 22

 Interpretation:
The total assets ratio is increasing i.e. from 1.20&1.21 in the year 20-21 & 21-
22 respectively. The higher ratio indicates that the assets are utilized
properly by the company

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3. Fixed asset turnover ratio = (Sales) /( Net fixed assets)

(Amount in lakhs)

Year Sales Net fixed Fixed asset

assets turnover ratio

2018-19 64202.81 49130.56 1.30

2019-20 70598.93 47094.16 1.49
2020-21 88196.68 51153.37 1.72
2021-22 112112.34 69457.18 1.61

Fixed asset turnover

2 ratio
1.
8

1.
6
Fixed asset turnover
1. ratio
4
0.
4

0.
2018- 2019- 2020- 2021-
19 20 21 22

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Interpretation: The ratio for 2021-22 reveals 1.61 of net fixed assets to sales,
compare to 2020-21 &2019-20, therefore the trend indicates the assets are
used not so efficiently in the year 2021-22

4. Current asset turnover ratio

5. Working capital turnover ratio

3. Profitability ratio

a) Profitability in relation to sales

1. Gross profit ratio

2. Net profit ratio

3. Operating expenses ratio

4. Operating ratio

b) Profitability in relation to investment

1. Return on investment

2. Return on equity

3. Earning per ratio

4. Dividend per ratio

5. Dividend payout ratio

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CHAPTER-06

LEARNING EXPERIENCE

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 LEARNING EXPERIENCE:

An organization study at ,VRL Logistics Limited Company Organization, has

enabled me to understand the organization structure of the corporate world to
an extent and the ways means how functions. As VRL Logistics Limited
Company Organization is one of the leading industry in travel sector. This
organization has large investment and a good number of people working in it.
Here, is a well established organized structure with top level management,
middle level management, and bottom level management.

The business familiarization program helped me to extend knowledge in

management field. Above all, the most important thing was I have got real
world to some extent, all of those wouldn’t have been possible without the
support, guidance, motivation and inspiration from the supervisors, and other
senior staffs of the organization. So, heartfelt thanks to all the members of the
organization, for helping me to know about the organization.

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 Conclusion :

VRL logistics limited is offering high quality service for customers. VRL
logistics ltd’s experience in service market through which the company can
offer the best service to the customer. The company has made sincere efforts
to achieve its goals and objectives over the years. It has good service record
and has good market potential and image.

VRL logistics ltd is building long lasting relationships with its customers.
Every member of VRL LOGISTICS LTD is motivated to perform and deliver
to the fullest of their ability by constantly upgrading the skill set off
employees to suit long-term goals. Through this the company expects to
come out with highly competitive and technologically advanced service and
solutions.

As the global scenario is changing and due to globalization and liberalization

the business environment also went into sea change, so the logistics plays an
important role in today’s business environment. As it is the part supply chain
management it is crucial in every business organisation..So the company
should take the advantage of changing business environment as logistics is
called lifeline of any business

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 BIBILOGRAPHY

www.vrllogistics.com

ww.vrlgroup.in

www.investopedia.com

google.com

Wikipedia.com

Scribd.com

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