This post shares a small observation made on the movie ‘Corporate’ made by Madhur Bhandarkar and released sometime in 2006.
Second and third paragraphs give some quick introduction to the movie those who have already seen this movie and want to skip into can skip intro and jump to 4th para here:
Intro to Movie:‘Corporate’ is a Hindi Movie by Madhur Bhandarkar and stars Sameer Dattani, Bipasha Basu, Minissha, Kay Kay Menon, Payal Rohatgi, Raj Babbar, Harsh Chhaya, Rajat Kapoor, Javed Akhtar, Deepshikha etc. The story line revolves around 2 corporate houses which are archrivals in soft drinks and processed foods business. The movie tries to showcase how the politico business nexus works and how companies try to pull each others’ legs.
Madhur Bhandarkars movies are always unique on their own. They are not based on a conventional bollywoord masala framework but are based on a strong storyline and are made after doing a great deal of research on the subject. Traffic Signal, Page 3 etc are his other popular movies. Watch when time permits.
Sehghal Group of industries want to produce mint based soft drink and encounter a problem. The water available near their plant is contaminated and not safe for consumption, in spite of purification mechanisms they have. The board considers only two options
First-Shift the entire production to another plant, which will delay the launch of the product by months and will severely affect they scheduled IPO. S
Second: To go ahead and use contaminated water. (Eventually this is what they choose)
Now, there’re two more alternatives in above scenario which the company didn’t consider. I bring to you those two alternatives and would like to take your opinion how feasible do you think they are.
When you need a raw material for production which is not available locally, it is commonsense to source it from elsewhere. In this case, locally available water was impure to be used for soft drinks, so they could have simply sourced the water from elsewhere.
Sourcing water from elsewhere is not a permanent solution but should have certainly helped them continue with product launch without having to compromise on safety.
Let us do a simple calculation to find out if it is economically feasible to bring water from elsewhere and run the business.
Assume a water source fit for consumption is available some 200 kms away from the plant. A normal tanker truck will have 3 compartments of 4000 liters each and carry 12000 litres of water in one trip. Assuming that a truck gives 4 kmpl mileage per liter of diesel and a liter of diesel costs close to Rs 35, operational cost of the truck per trip (fuel charge plus other expenses accommodated) works out close to Rs. 10 per km or Rs. 4000 per trip (200kms one way *2). With 12000 liters of water it is possible to produce 36000 bottles of soft drink (330 ml each). That means, cost per bottle will be 11 paise only. Given that their current production cost was Rs. 3.70 an additional 11 paise makes it economically feasible to continue in business.
Why on earth they didn’t consider this option?
Another alternative is to reduce production of some of the existing product (regular soft drinks) and use the facility to produce new product (mint based soft drink)-this would have compromised on volume but would have certainly allowed them to continue with their product launch. Even this option was not considered.
Madhur Bhandarkar, are you listening?
May be these options were intentionally ignored because they don’t fit in the story line. Drop a comment what you think of it.
Image sourced from Wikimedia.
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