Fast Moving Consumer Goods ( FMCG ) or Consumer Packaged Goods ( CPG ) are the merchandises that have a really speedy sale at comparatively really low monetary value. The chief net income of these companies are non based on the border, it is chiefly based upon the volume of the gross revenues. The merchandises in the market are updated really fast due to high competition.
The chief merchandises of these type of companies are: –
Food and wellness drinks
Vegetables and Fruits
Financial and Accounting Management Information System Used in FMCG: –
These Systems tracks the fiscal events and helps to sum up the whole fiscal information
These sort of systems computerise the Financial direction ( PFM ) processes
They are helpful to fix the fiscal studies, budget determination, fiducial duties
The chief undertaking fulfilled by these systems is the integrating of the informations
The range for this IS extends from General Ledger, Debt control, Auditing procedure, Revenue aggregation, Payroll.
The FMCG Company that has been analysed for Finance and histories is HUL ( Hindustan Unilever Limited )
Hindustan Unilever Limited is India ‘s largest and one of the universe ‘s taking FMCG Company with annual turnover of approx Rs.18, 000 crores in India, it is a subordinate of Unilever which has a interest of 52 % in HUL and an one-year turnover of 40Billion Euros and has a market in more than 100 states. The company is besides on the list of Forbes Fortune 500 companies.
The followers are the merchandise line of the company: –
1 ) Liril
2 ) Lifebuoy
3 ) Haman
4 ) Dive
5 ) Lux
6 ) Pears
7 ) Breeze
Sun silk Naturals
Fair and Lovely
Brooke Bond Bru
1 ) Knorr
2 ) Kissan
HUL turned to SAP exchequer to run into all its demands. To incorporate the exchequer procedure from be aftering and determination devising of Hindustan lever to the direction of fiscal minutess and places, SAP exchequer linked overall Sap R/3 system execution at Hindustan lever and besides for the transportation of records to fiscal accounting.
The two large advantages over which the SAP exchequer was chosen were portability and integrating. To accomplish the vision of set uping a planetary exchequer information system, portablility was required.
The new SAP exchequer direction system availed a good return on initial investing and streamlined the exchequer operations in the US.
SAP Treasury v/s the Earlier Systems
The corporations these yearss are measured on the truth and seasonableness of information on the hard currency place, finding which is the most of import operational responsibility that the exchequer has. SAP Treasury enabled Hindustan lever to acquire immense betterments in the seasonableness and truth of this information.
It was n’t executable to bring forth automatically the basic day-to-day hard currency place. Datas from three different systems were taken manually and set into a spreadsheet to acquire hard currency place each twenty-four hours, which resulted as clip consuming and cumbersome and it prolonged their month-end shutting procedure.
To compact the month-end stopping point, SAP Treasury approved exchequer forces to put to death more value- added undertakings in the corporation. The SAP exchequer solution has hastened the day-to-day hard currency processing, liberating the staff clip for analysis. The quality of information has enhanced drastically with day-to-day poster and rapprochement.
Every twenty-four hours for Hindustan lever the SAP Treasury accumulate lock boxes and anterior twenty-four hours bank statements. The gap leger balances of the hard currency places are updated by the elaborate bank history statements and are by design posted to the SAP R/3 General Ledger as constituent of an machine-controlled rapprochement of anterior twenty-four hours activity.
In combination of the liquidness prognosis of the hard currency influxs and the escapes. The SAP exchequer provides wide-ranging information to place the current or future liquidness deficit or surplus. All this information enhances the hard currency director to concentrate more on analysis instead than minutess. SAP exchequer strongly integrates between hard currency direction and exchequer direction. Due to SAP treasury the hard currency director do n’t hold to pass clip on doing journal entries and month terminal shutting, everything in done on real-time, twenty-four hours to twenty-four hours basis..
The SAP Treasury is used to do analysis on Currency hazard and Hedging minutess ; it besides consists of Market Risk Management.
SAP Treasury is supplemented with 2 Complimentary Sotware patners: –
Inbound electronic Banking solution from Cerg Finance
Outbound electronic Banking solution from Citibank
SAP Treasury includes within 3 critical constituents: –
Cash Management ( For analysis of liquidness and E-banking )
Market Risk Management ( For involvement exposure and buttockss currency )
Transaction Management ( for pull offing dealing portfolios in securities foreign exchange etc. )
SAP Treasury System Characteristics
FMCG is a characteristically protective sector – with a really inelastic demand. The sectors gross ne’er dip drastically when ther is rise or contraction of income, nor the gross revenues rise drastically when the monetary values falls. There is really large a clip slowdown between the reduction/increase of incomes and the impact on FMCG gross revenues because of the `daily necessity ‘ character of these merchandises ; it takes a long clip for clients to cut down or halt the ingestion of these merchandises.
Rate of Return ( ROR ) , besides known as return on investing ( ROI ) , rate of net income or sometimes merely return, is the ratio of money gained or lost ( whether realized or unrealized ) on an investing relation to the sum of money invested. ROR for Colgate Palmolive is +25 % by implementing the SAP Treasury.
Discounted Payback Period: Duration of clip required to retrieve the initial hard currency ooze from the discounted future hard currency influxs. This is the progress where the present values of hard currency influxs are cumulated until they equal the entire initial investing. For the Above SAP Treasury System, it was estimated to be 3.3 old ages.
The altering planetary scenario and concern demands lead to the acceptance of newer engineerings to do sense of informations and automate concern processes. Management Information Systems are needed to supply a competitory advantage, operational excellence, to last and better client familiarity.
Associating of the SAP Treasury System with the Reuters provides them with up to day of the month information on Commodity monetary values which can assist the Colgate Palmolive Company to fudge in times of volatility in the monetary values of natural stuff to be used as ingredients in the merchandise section.
The employees are now more efficient in their functions as Finance Officers as they no more have to make the boring occupation of informations entry but instead do informed analysis and determinations.
FMCG sector is recession cogent evidence. Human Beings as clients will ne’er halt bathing, brushing their dentitions, creaming themselves, therefore the consequence of recession was the least on this sector. The Real victors have been those companies who have synergized their concern with Information Systems and supplemented their market portion by taking advantage of the volatile state of affairs in those times.
Integration of assorted sections in any Company, FMCG or otherwise is what will supply them with the competitory advantage to last and do new market inventions to drive better growing.