Buildings and housing infrastructure is a major input to the economic development and sustained growth of an economy. A nation on the road to development requires to be fuelled appropriately by civil and industrial infrastructure, with products and services. Nagarjuna Construction Company Ltd. has been providing quality infrastructure support to India’s growing industrial, retail, ITeS and services sector. Srinivas Mantha talks about the challenges in procurement and logistics supply chain divisions.
Scope and challengesThough India is doing well in many industries today, still there is a lot of scope to improve in terms of strategic procurement, especially when it comes to infrastructure projects. Such improvement will definitely help increase the overall business as well.
There are some challenges faced by project procurement community today. “In number of cases, delay is observed in client approval of drawings as well as in statutory approval. Also there is delay in getting quotations timely as per BOQ and supply of some critical materials” says Mr Mantha.
Moreover, due to long outstanding, suppliers are not willing to supply material for further requirements. And banks are not willing to give loan or BG limit to the infrastructure companies. In addition, due to improper documentation, material gets stopped at check post boarders. Inadequate warehouse and logistics facility is also a key challenge.
In addition to this, some of the major challenges the project procurement community is facing are as follows:• Non-availability of proper logistic   facility at some locations• Frequent price variations of materials• Delay in transportation of material in time due to road conditions and hilly areas (like North East states)• Delay in opening of bank guarantees and letter of credit• Delay in receiving payments from concerned clients• Supply of wrong material due to which work quality gets hampered• Due to improper documentation for imported goods, delay in getting clearance from custom officers.
Logistics supply chain Logistics supply chain plays a vital role in overall completion of procurement process. In some projects, it is observed to be effective. However, for better and consistent operations, it still requires improvement.
When it comes to logistics supply chain, some issues need to be paid attention properly. “Due to unavailability of trailers in the market, transporters do not place the trailers in time which should be avoided,” points out Mr Mantha. “Sometimes damage of material in transit time and taking long time for delivering goods also add up to problems in productivity of logistics chain.”
Further, selection of wrong vehicle, frequent price variations of trailers due to increase in fuel costs affect the process. Even sometimes it is observed that due to elections or bundhs or local issues, material transportation gets delayed. ——————————————————————There are some challenges faced by project procurement community today. In number of cases, delay is observed there in client approval of drawings as well as statutory approval which should be avoided.
– Srinivas Mantha,Asst. General Manager(Materials), NCC Limited.