Supply Cahin Management of Alauddin Textile Mills (Pvt.) Limited

Chapter One: Introduction 1. 1: Introduction Bangladesh is rich in natural resources as well as human resources. There are many garments and textiles in this country for the availability of manpower. Favorable environment for work and co-operation of government also encourage establishing garments and textile industries here. Alauddin Textile Mills (ATM) Pvt. Limited is one of the well-known textile mills in Bangladesh. In this paper, I take Alauddin Textile Mills (ATM) Pvt. Ltd. as a field of my investigation and research. This company is also known as ATM lungi factory locally for producing popular product “ ATM Lungi”.

This company is to conduct many of it’s activities for supplying it’s well-known product to the customers . Of them, I chose it’s supply chain management as my research field. Because, supply chain management is an inevitable part of any company. I noticed it’s all supply chain activities very closely. In recent years, supply chain management (SCM) has been developed as essential management philosophy and practice for all business operations. As with other business management principles, SCM also applies to the textile and apparel industries.

A sound supply chain management helps to identify the supplier and the customer demand that operation must satisfy, link customer demand with suppliers and production plans, and keep the operation function focused on satisfying customers’ need. The supply chain not only includes the manufacturer and suppliers, but also transporters, warehouses, retailers, and customer themselves. Supply chain management (SCM) is the synchronized of a firm’s processes and those of its suppliers to match the flow of materials, services, and information with customer demand.

It is also a process of managing operations control, resource acquisition and purchasing, and inventory to improve overall efficiency and effectiveness. This paper focuses on some of the major aspects of supply chain management with its major recompense and how to design and implement effective and efficient supply chain management. 1. 2: Background of the company: Alauddin Textile Mills (Pvt. ) is a well known textile industry of Bangladesh. It has achieved it’s fame to produce lungi a native popular product of Bangladesh. Now a days “ATM Lungi” is now most popular brand in lungi in Bangladesh.

Garments and textiles are considered as a beck and belly of earning foreign currency. Especially Dhaka region has the major concentration in establishing garments and textiles. So ATM Pvt. Limited has chosen Tangail and Norshindi which are near at hand of Dhaka, as factory place. It is a private limited firm. The incorporation period of this firm is 1993. Mr. Alauddin (engineer) is the entrepreneur and custodian of this company. He started production in a small amount with small capital and sell it in the local market of Tangail.

Initially, he had to face many hardship to cut a established figure. But,He gradullay become afford to occupy the local market for maintaining good quality product. Thus, in a short possible time ATM Lungi disbursed it’s reputation throughout the whole country. It is registered with Board of Investment ( Bangladesh). This company out and out concerned with textile business. Cotton, Yarn, Fabric are the listed product of this firm. But, Lungi is the finished goods of ATM Limited. It was the outset of this company when the number of worker was only a handful 10-15 and employees were 2 and Mr.

Alauddin himself executed his business. Now, about 2300 workers and 200 employees are at the disposal of this company . Female workers have taken the possession of 45% of total number of workers. It is mentionable that this company didn’t allow no child labor so far. This company is also the member of Dhaka Chamber of commerce, and Narshindi &Tangail Chamber of commerce. 1. 3: Statement of the problem: In production plan of this factory, there are many hardship faced by the production manager. To run production smoothly it is crucial to perform some logistics.

These are procurement, operation, distribution, after sale, disposal, human resource management, channel management, material handling logistics etc needed to handle potentially for having a smoothly production . Because for the distance & infrastructure problem, many producer fail to produce as their expectation. Bangladesh is not affluent in producing raw materials of textile industries. It is another problem for why these factories always worry about raw material supply. Besides this, human resource management has become the most critical task in garment or textile ndustries. Actually, companies don’t have enough time to spend to conduct any research to find out these problems. I have tried to find out some problems regarding production point to selling point in this paper. I do believe my report help this company to unearth problems regarding SCM. 1. 4: Importance of the study: Theoretical information is not sufficient for business students because there is a gap between theoretical knowledge and practical ground. This internship program has been initiated mainly to less this gap.

So, this practical idea on various activities and functions of different department of Alauddin Textile Mills (Pvt. ) Ltd. help me in future to increase my efficiency and effectiveness. . I believe that the analysis, findings and recommendations will be helpful for the organization to effectively utilize the benefit of supply chain management & increase the efficiency and effectiveness of their current operations. The use of these tools enables the textile industries to greatly increase its profitability because it is able to match supply and demand in a much more coordinated fashion.

Therefore, the importances of this study are- • To gather practical knowledge about supply chain activities of textile mills in Bangladesh. • It helps to scrutinize the strength and weakness of the company’s SCM system. • Finding the problem regarding SCM. • It will Measure efficiency of the company in all logistics. • Finding the gap of previous research regarding this. • Recommending some suggestion against the problems 1. 5: Objectives of the study: Objective means the target concern for which certain effort or works are performed. There may be a single objective or multi-objectives.

So the objective should be identified firstly, and on the basis of objectives or with a view to achieve that objectives the plan is designed and next steps are taken to implement the outline about the objectives. So, the main objectives of this study is are- * Achieving a realistic idea of existing system of Supply Chain Management of this industry. * Problems faced by the participants. * Opinion of different groups faced the problems. * To give a few suggestions. 1. 6: Methodology: This report is being tried to complete micro level study in a confined, specific, and a given period.

To prepare the report I have followed some specific methods and technique, which were helpful for collecting and analyzing data. After I determined what and why I am looking for, then I set adrift our boat to the sea. In this report I have used primary and secondary data. After getting adequate materials I then went through the materials and was trying to find the answer of my objective questions. Within the process I had to contact with my supervisor sir. Evaluating all the information I gathered different record and statement of ATM privet limited, BTMA report has helped me preparing this report.

The subject material of this report is on primary and secondary sources of data and information. Sources of information:                          Primary source * Relevant document studies  as provided by the officers concerned. * Observation of various departments. * Collection information from suppliers and customers through questionnaire. Secondary source * Annual report of ATM privet limited. * Prospectus of ATM private limited . *  Brief of ATM privet limited chief officers and staff. * Extensive literature search on the basis of document and publication, BTMA, BTMC, BGMEA. Interview supplying agents and customer of the company through questionnaire. Population: The study is about supply chain management of the company so the populations are considering as supplier agents and all the customer of the company. Sample: Sample is a subset, or some part, of large population. It is not possible to take all data in report writing so I am take sample for data analysis. I have taken ten samples from the supplier agents and the customer in the company. Sampling: Sampling is the process of using a small number of items or parts of larger population to make conclusions about the whole population.

There are various types of sampling. In my study I am follow the simple random sampling. Simple random sampling is a sampling procedure that assures each element in the population an equal chance of being included in the sample 1. 7: Limitations of the study: I won’t say that my study and the decisions I made are self sufficient. That doesn’t mean that there was any dearth of my professionalism and eagerness to reach to the solution, rather it means that I had to face some obstacles. Those may be summarized as follows: * It was so difficult to collect the adequate and real data from the assigned organization. Lack of experience in related field. * The research area was so far from our institution. * Due to the lack of time I could not acquire in depth knowledge of the activities of different department perfectly and clearly.. * Improper combination among various departments. * There was not any research regarding this topic in this institution. So, it was complication for me to collect data collection. * Adequate books, publication and journals were not available. * The respondents were not aware enough about my work. It took me more time to conduct my research. 1. : Tentative presentation of the study: This report is composed of eight chapters, which are further divide into different parts. In the first chapter, the introductory portion has been present along with background of the study, Importance of study and the objective of the study and the methodology, limitation and Literature review discuss in chapter two. A conceptual framework is included in chapter three from where we will be able to get the basic idea about the operation of the company. Chapter four includes result and discussion based on objective of the study.

From where the textile mill collect raw materials, how they collect the raw materials, what are the basic raw material required by the spinning sector are discussed in this chapter. What are the main considerations in selecting suppliers, process of making order for raw material, landing procedure of import are also discussed in the chapter. The summary and recommendation of the study are discussed in chapter Five. Chapter six highlighted the reference of the study from where I gathered theoretical knowledge about it. Chapter seven exposes bibliography.

And in chapter eight, I have discussed appendices that include some table figure and questionnaire. Chapter Two: Literature Review A literature review is a body of text that aims to review the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to a particular topic. Literature reviews are secondary sources, and as such, do not report any new or original experimental work. Most often associated with academic-oriented literature, such as a thesis, a literature review usually precedes a research proposal and results section.

Its ultimate goal is to bring the reader up to date with current literature on a topic and forms the basis for another goal, such as future research that may be needed in the area. There are lots of researches in supply chain management in world. There are many books also regarding SCM. Graham Heaslip (School of Business and Humanities, Department of Management Studies, Institute of Technology Carlow, Ireland) on his book of Supply Chain Management: Strategy, Planning and Operation he tried to identify the core activities of SCM of any firm. He discuss about strategy needed to operate SCM activities for smoothly run of production.

Ning Cao, Zhiming Zhang, Chester To and Roger Ng (Institute of Textiles and Clothing, The Hong Kong Polytechnic University) in their study of “Supply Chain Management Practice and Competitive Advantage in Textile and Apparel Industries” they conducted an empirical study. They showed there the overall practices of Supply Chain management of various industries in Hong Kong. Pankage Chandra (Professor of Operations & Technology Management) Publish a research on “The Textile and Apparel Industry in Indian,” in The Oxford Companion to Economics in India, 2007.

He analyzed Manufacturing management; Supply chain coordination; Building technological capabilities; Hi-tech entrepreneurship in his research. An article written by Prof. Atanu Ghosh on “Supply Chain for the Apparel Industry – Some Tips” was published in RETAIL e-LETTER of the Retail Vision Group, Issue No. 21, 20th November 2003. He also give some recommendation regarding textile industries SCM practices. A research was conducted in Makson Spinning mills Ltd by Student of BRAC University in Bangladesh. They measured the efficiency of practices of SCM management of Makson Spinning mills Ltd.

They also showed Prospectus of MSML, published on 18 September-2008 By Kazi Anwarul Masud in study of Bangladesh Economy- Problems & Prospects with garments and textile industries- Part II on march 2010 mentioned the economic philosophy of textile industries in Bangladesh. Problems and Prospect of Garments Industry in Bangladesh (Part-7) By Abu Zafour Published 19 October 2009 is another study regarding this. There are problem of garment and textile industries in Bangladesh. Chapter Three: Conceptual Framework of Supply Chain A supply chain (SC) consists of all parties involved, directly or indirectly, n fulfilling a customer request. The supply chain not only includes the manufacturer and suppliers, but also transporters, warehouses, retailers, and customer themselves. Within each organization, such as a manufacturer, the supply chain includes all functions involved in receiving and filling a customer request. These functions include, but are not limited to, new product development, marketing, operations, distribution, finance, and customer service. Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers.

Supply chain management ps all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (supply chain). Another definition is provided by the APICS Dictionary when it defines SCM as the “design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally A typical supply chain may involve a variety of stages. These supply chain stages includes: * Customers Retailers * Wholesalers/Distributors * Manufacturers * Component/ Raw material suppliers A firm can vary supply of products by controlling a combination of the following two factors: ? Production capacity ?       Inventory Following I list some specific approaches to managing capacity and inventory with the goal of maximizing profits. Managing Capacity: When managing capacity to meet predictable variability, firms use a combination of the following approaches. a)     Time flexibility from workforce b)     Use of seasonal workforce. c)     Use of subcontracting. d)     Use of dual facilities )     Designing product flexibility into the production in processes Managing Inventory: When managing inventory to meet predictable variability, firms use a combination of the following approaches: a)     Using common components across multiple products b)     Build inventory of high demand or predictable demand products. All the Supply Chain drivers discussed up until this point have dealt directly with some physical aspect of the supply chain. Information is the supply chain drivers that serves as the glue allowing the other three drivers to work together to create an integrated, coordinated supply chain.

Information is crucial to supply chain performance because it provides the foundation on which supply chain processes execute transactions and managers make decisions. With out information, a manager will not know what customers want, how much inventory is in stock, and when more products should be produced and shipped. In short, without information a manager can only make decisions blindly. Therefore, information makes the supply chain visible to a manager. With this visibility, a manager can make decisions to improve the supply chain’s performance.

In much way’s information is the most important of the four supply chain drivers because without it, none of the other drivers can be used to deliver a high level of performance. Given the role of information in a supply chain’s success, managers must understand how information is gathered and analyzed. This is where IT comes into play. IT consists of the hardware and software throughout supply chains that gather, analyze, and act on information. IT serves as the eyes and ears of management in a supply chain, capturing and analyzing the information necessary to make a good decision.

Using IT system to capture and analyze information can have a significant impact on a firm’s performance. For example, a major manufacturer of computer work stations and serves found that much of the information on customer demand was not being used to set production schedules and inventory levels. Information is the key to the success of a supply chain because it enables management to make decisions over a broad scope that crosses both functions and companies. Information must have the following characteristics to be useful when making supply chain decisions: 1.

Information must be accurate: Without information that gives the true picture of the state of the supply chain, it is very difficult to make good decisions. That is not to say all information must be 100 percent correct but rather than the data available paint a picture of reality that is at least directionally correct. 2. Information must be accessible in a timely manner: Often a accurate information exists, but by the time it is available, it is either out of date or if it is current, it is not in an accessible form. To make good decisions, a manager needs to have up-to-date information that is easily accessible. 3.

Information must be of the right kind: Decision makers need information that they can use. Often companies will have large amounts of data that is not helpful with decision making. Companies must think about what information should be recorded so that valuable resources are not wasted collecting meaningless data while important data goes unrecorded. Supply chain management is a cross-functional approach to managing the movement of raw materials into an organization, certain aspects of the internal processing of materials into finished goods, and then the movement of finished goods out of the organization toward the end-consumer.

As organizations strive to focus on core competencies and becoming more flexible, they have reduced their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other entities that can perform the activities better or more cost effectively. The effect has been to increase the number of organizations involved in satisfying customer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts.

The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and improving inventory velocity. Several models have been proposed for understanding the activities required to manage material movements across organizational and functional boundaries. SCOR is a supply chain management model promoted by the Supply Chain Management Council. Another model is the SCM Model proposed by the Global Supply Chain Forum (GSCF). Supply chain activities can be grouped into strategic, tactical, and operational levels of activities.

Strategic * Strategic network optimization, including the number, location, and size of warehouses, distribution centers and facilities. * Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics. * Product design coordination, so that new and existing products can be optimally integrated into the supply chain, load management * Information Technology infrastructure, to support supply chain operations.

Tactical * Sourcing contracts and other purchasing decisions. * Production decisions, including contracting, locations, scheduling, and planning process definition. * Inventory decisions, including quantity, location, and quality of inventory. * Transportation strategy, including frequency, routes, and contracting. * Benchmarking of all operations against competitors and implementation of best practices throughout the enterprise Operational * Production and distribution planning, including all nodes in the supply chain. Production scheduling for each manufacturing facility in the supply chain (minute by minute). * Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers. * Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers. * Inbound operations, including transportation from suppliers and receiving inventory. * Production operations, including the consumption of materials and flow of finished goods. * Outbound operations, including all fulfillment activities and transportation to customers. Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers, and other customers. Chapter Four: Result and Discussion In this chapter, the study needs to discuss about the existing production system where the SCM system will be focused according to the first objective of this study. Here, there is a chronological discussion about the existing supply chain management activities. The following are the raw materials needed producing finished product of this company- 4. 1: Textile fibers

Fibers used for the production of yarn are called textile fibers. All the fibers are not textile fibers, textile fibers must have some of the essential characteristics e. g. 1)     Minimum length to insert twist. 2)     Strength 3)     Fineness 4)     Pliability or flexibility 5)     Cohesiveness 6)    Rigidity or stiffness 7)     Elongation & Elasticity 8)     Moisture Absorbency etc. Classification of textile fibers: Different textile fibers are used in textile industry. Some of them we get from natural sources and some of them are man-made classification of fibers are shown in the following chart:

Figure: Classification of Textile Fiber 4. 2 Basic Considerations in selection of raw material Textile fiber’s length analysis Wide variations of fiber lengths occur within a fiber of the same source as well as between varieties obtained from different source. Staple fibers include all natural fibers except, sild-sidk is a natural filament fiber Man-made fibers, manufactured in filament form, and silk filament fibers may be cut up to form short staple fibers. Staple is fiber of cotton, wool or ramie etc. of no more than a few inches long. Filament is usually a manmade fiber of indefinite length.

The size of yarn is usually related to the weight of the fabric, for heavy fabrics we use thick yarn, for light fabrics we use fine yarn. Textile fiber’s diameter analysis: The diameter of a fiber is the distance across the fiber’s cross section. The diameter of   natural staple fibers is irregular and may vary from one part of the fiber to another. Staple fiber diameters are measured in microns. The diameters of the smooth, even filament man-made fibers is uniform 4. 3 Characteristics of textile Spun yarn * Composed of short staple fibers of definite length Made from natural cotton, flax or wool staple fibers * Made from natural or Man-made filaments which are chopped or cut into short lengths and referred to as filament staple yarn. * Individual fiber length vary * Bigger and wider in diameter than filament fiber yarns. * Fuzzy appearance and feel; fiber ends protrude from yarn * Uneven number of fibers throughout * Range from soft, loose construction to hard finished, fine twist yarn * Thick and thin areas highly twisted * Fall apart when untwisted * Dull or flat in appearance * Rough to the touch Natural textural appearance and feel * Bulkier to the feel * Provide good covering power * Snagging depends on fabrics structure * Pilling depends on fiber content 4. 4 Characteristics of textile blended yarn & fabric In order to achieve certain appearance, and effect on fabrics or to avoid paying high import duty on garments to be exported to the exported to the United States which is the biggest buyer of garments from the Asian producing countries, we often mix different fibers in the yarn to make fabrics. Instead of using only one kind of fiber, we may use 2 or 3 kinds.

As each kind of fiber has its own characteristics, when we plan to mix them, we should consider their characteristics to create a hybrid with the characteristics we need. Therefore it is important that we know the characteristics of the following key fibers: Cotton: Soft, very absorbent, shrinks when washed easy to crease. Ramie & linen: Compared to cotton, not soft, less absorbent, shrinks when washed, but to a less extent, easy to crease Rayon: Compared to cotton, softer than cotton equally absorbent, Shrinks more than cotton, very easy to crease, has a luster like silk

Polyester: Compared to cotton, not soft, absorbent at all, does not shrink in normal wash not easy to crease Wool: The characteristics vary dependent on the kind of wool it is, but it has these general characteristics: Compared to cotton, not very soft, not absorbent. The staple is slightly crispy which can lead to a bulky effect when finally made into fabrics. It shrinks seriously when washed in hot water. Not easy to crease. Nylon: Can be soft or firm dependent on the finish applied, not absorbent, does not shrink when washed, not easy to crease, very strong

Silk: Finer and softer than cotton, equally absorbent, shrinks more than cotton easy to crease, has a smooth surface with luster when it is made into fabric. Acrylic: Not soft, not absorbent, dies not shrink in normal wash. The staple is slightly 4. 5 Suppliers Selection and Contracts Once the analysis has been completed, a list of promising suppliers will emerge. The firm select desired suppliers using a variety of mechanisms including off- line competitive bids, reserve actions, or direct negotiations. No matter what mechanism is used, supplier selection should be based on total cost of using a supplier and not just the purchase price.

Before selecting a supplier, the firm must decide whether it will use single sourcing or will have multiple suppliers from which to source the product. Single sourcing is used to guarantee the supplier sufficient business when the supplier has to make a significant buyer-specific investment. Once suppliers have been selected, contracts have to be structured between the buyer and each supplier. 4. 6 Placement Process of an Order ATM places the order of raw materials to the suppliers. When placing an order for raw materials it needs highest 30 days.

For placing an order they use some medium, the mediums are: ? E-mail ?       Fax ?       Letter ?       Phone The company asks for proforma invoice from the suppliers using the aforesaid means of communication where the terms and conditions are mentioned clearly. 4. 7 List of Banks involved in import of ATM Dutch Bangla Bank Ltd Norshindi Brach, Norshindi Pubali Bank Ltd. Tangail Branch, Tangail. 4. 8 List of Major local Agents of ATM 1. A. R. Cotton 2. Dhaka Cotton 3. Trade Scan Int’l 4. Desh cot 4. 9 List of Major Supplier of raw cotton of ATM 1. Indian Cotton Company-India 2.

LGW Industries 3. P. D. Sekhsaria-India 4. Omprakash Shiva. 4. 10: The Procurement Process Once supplier have been selected, contracts are in place, and the product has been designed, the buyer and supplier engage in procurement transactions that begin with the buyer placing the order end with the buyer receiving and paying for the order. When designing the procurement process, it is important to consider goods that the process will be used to purchase. There are two main categories of purchased goods Direct and Indirect materials. Direct materials are components used to make finished goods.

Indirect materials are goods used to support the operations of a firm. A good example of a procurement process that focuses on these objectives is the e-Hub initiative at Cisco. As ATM Mills Ltd. Produce 100% cotton yarn only, the main raw material is the Fibers. The company imports fibers from, Canada, Uzbekistan, Kazakhstan, India, and Pakistan etc. Imports of raw cotton by ATM in June-2011 SL| SELLER| INDENTOR| L/C NO| Description| Bales| 01| Cargil Cotton, U. K| Bakul Ltd. | 2217-08-01-0470| Origin-UzbekistanGrowth-SM, Staple-1. 1/8”,Mic- 3. 8-4. 9 NCL,| 1110| 02| Mambo Commodities, U.

K| Dhaka Cotton| 3037-08-02-0003| Growth-Benin, Grade:Kaba-SStaple- 1. 1/8”, Mic-3. 5-4. 9 NCLPressley-29 GPT| 1106| 03| Plexus Cotton, U. K| Bakul Ltd. | 1335-08-01-0534(Bulbul Tex)| Origin- MaliStaple-1-1/8”,| 1092| 04| Cottonex Anstalt, Vaduz| Wellcot Inter’l| 1335-08-01-0541| Origin- CIS (Uzbek)Grade- Pervey selected-SM| 1164| 08| Cottonex Anstalt| Wellcot Inter’l| 1335-04-01-0611| Origin- CIS(Uzbek) Grade- Pervy Selected-SM, Staple- 1-1/8”,| 1206| | | | Total Bales| 7777| | | | | | | | Statement of Raw cotton Purchase by ATM as on 20 September-2011 1.

L/C IN PIPE LINE SUPPLIERINDENTOR| L/C NO. | DESCRIPTION OFRAW COTTON| QTY| VALUE| P. D. SEKHSARIA-INDIADHAKA COTTON CO. | LC- 0793DT. 05-07-08SBL| MCU-5 –30 MM INDIA| 100M/Tons=220,460lbs+150 M/Tons =330,690 lbs (1490 Bales)| $ 156,526. 60$ 234,789. 90$ 3,91,316. 00| P. D. SEKHSARIA-INDIADHAKA COTTON CO. | LC – 0893 DT. 08. 12. 03     SBL| SANKAR-6 (SUPER) –28. 56 MMINDIA| 120 M/Tons =264,552 lbs (720 Bales)| $ 190,477. 44| P. D. SEKHSARIA-INDIADHAKA COTTON CO. | LC – 0916 DT. 17. 12. 03     SBL| MCU-5 –30 MM INDIA| 120M/Tons =264,552 Lbs (720 Bales)| $ 194,445. 2| INDIAN COTTON COMPANY- INDIAA. R. COTTON TRADING, DHAKA| LC – 0023DT. 10. 01. 04| MCU-5, 30 MMINDIA| 244. 9M/Tons=539980 Lbs (1400 Bales)| $ 383,385. 80| 2. RAW COTTON IN BOOKING (L/C DUE FOR OPEN) SUPPLIERINDENTOR| DESCRIPTION OFRAW COTTON| QTY INBALES| QTY IN LBS| U. PRICE| VALUE| MAMBO COMMODITIES, U. K| KABA-S 1. 1/8”28 GPT| 260 M/TONS| 573,196. 00| USC 76. 00| $435,628. 96| 4. 11 Making Sourcing Decisions in Practice This involves choosing the suppliers that will deliver the goods and services you need to create your products or services.

It also involves developing a set of pricing, delivery and payment processes with suppliers and create measurement criteria for monitoring and improving the relationships. Enterprises also need to put together processes for managing the inventory of goods and services that they receive from suppliers, including receiving shipments, verifying them, transferring them to their manufacturing facilities and authorizing supplier payments. 1. Use multifunctional teams: Effective strategies for sourcing result from multifunctional collaboration within the firm.

A sourcing strategy from the purchasing group is likely to be narrow and focus on purchase price. 2. Ensure appropriate coordination across regions and business units: Coordination of purchasing across all regions and business units allows a firm to maximize economies of scale in purchasing and also to reduce transaction costs. 3. Always evaluate the total cost of ownership: An effective sourcing strategy should not make price reduction its sole objectives. All factors that influence the total cost of ownership should be identified and used for supplier selection.

Build long term relationship with key suppliers: A basic principle of good sourcing is that a buyer and a supplier working together will generate more opportunities for savings than the two parties working independently 4. 12: The Role of the Safety Inventory in the Supply Chain Safety inventory is inventory carried for the purpose of satisfying demand that exceeds the amount forecasted for a given period. Safety inventory is carried because demand forecasts are uncertain and a product shortage may result if actual demand exceeds the forecast demand. Figure: Inventory profit with safety inventory

For any supply chain, there are two key questions to consider when planning safety inventory: 1. What is the appropriate level of safety inventory to carry? 2. What actions can be taken to improve product availability while reducing safety inventory? Impact of Supply Uncertainty on Safety Inventory In many practical situations, supply uncertainty also plays a significant role. Consider the case of the Dell assembly plant in Austin. Dell assembles computers to customer order. When planning the level of component inventory, Dell clearly has to take demand uncertainty into account.

Suppliers, however, may not be able to deliver the components required on time for a variety of reasons. Dell must also account for this supply uncertainty when planning its safety inventories. The basic principle of textile is to spin textile fibers into yarn and weaving . Bales of cotton will be opened, mixed and then will be passed through the blow room line to remove dirt, foreign materials and to open the tufts of fibers and ultimately to produce regular lap by scutcher. The laps will pass through the carding machine to individualize the fibers and to remove dirt, neaps ;amp; short fibers and finally produces slivers.

As and when necessary these slivers will pass through the lap former to produce comber laps. The laps will be fed to the combing machine to remove the maximum short fibers and ultimately to produce regular slivers. The combed slivers will pass through the drawing frame, where doubling and drafting will be done and will produce regular sliver which will be fed to the simplex rime to produce roving and then ell be fed to the spinning frames where drafting and twisting will be done and will produce yarn in bobbin form. Finally, heat setting of yarn will be done, before coning.

Thereafter, individual cones will be wrapped in polythene packing in paper cartons ( 100 lb. each carton) and sent to the market. In rotor card sliver will be feed to the draw frame 1st and 2nd passage after that final drawing sliver will be feed to the rotor frame and in rotor frame drafting and twisting will be done and finally yarn will be wind in cone form these cone will be delivered to knitting section 50% will be sold out. Figure: Flow chart for producing yarns at ATM Enterprises need to schedule activities necessary for production, testing, packaging and preparation for delivery.

This is also the most metric-intensive portion of the supply chain so quality levels, production output and worker productivity have to be measured. 4. 13: Spare Parts and machinery used By ATM for yarn production To produce the export yarn the following Spare Parts and m/c s are mainly used by ATM SL| Name of section| Machine and spare parts specification| Quantity| 01| Blow room| Foreign Fiber Detector| 1. Nos| | 02| Carding| Taken in under Casing Segment and Stationary Flat| 14. Nos| | 03| Carding| Stripping Roller For Flats| 14. Nos| | 4| Simplex| Simplex Saddle Spring SKF Germany| 1000 Nos| | 05| Simplex| Simplex PVC Core Cots (Beveled) Size: 1 D = 19 mm                           0 D = 28 mm                      Length = 39 mm| 1800 Nos| | 06| Simplex| Spacer White and Green Original SKF| 500+500=1000 Nos| | 07| Simplex| Flyer Presser For FL 16                                ( 108 Spindle)| 100 Nos| | 08| Ring| Cot Irradiation Machine( U. V Treatment)| 1 Nos| | 09| Finishing| Yarn Conditioner micHeat Salting| 1 Nos| | 10| Quality Control| H V I / H F I Mic( For Fiber Testing)| 1 Nos| | 11| Quality| Twist Tester| 1 Nos| | 2. | Weaving| Power loom| 150| | 4. 14: Textile Yarn Construction Yarn count, yarn ply and yarn construction interrelate to form the characteristics of yarn. Yarn construction is classified as: a)     Simple/ conventional yarns are two or more simple single yarns plied or twisted together. They are referred to as two three, four, five or six ply yarn. Size and number of plies may be changed for different weaves or fabric structures. b)     Complex/Novelty Yarns are single or plied yarn structures characterized by international introduced irregularities in size and twist effects.

The irregularities of novelty yarns may be uniform. c)     Metallic Yarns produced by lacquering aluminum pigment or by laminating aluminum foil between layers of plastic. Since metallic yarns are flat rather than round as most other man- made fiber yarns, the size of the yarn is specified in inches. d)     Textured Yarns are the end result of physical, chemical or thermal manipulation of fibers and yarns so that they are no longer straight or uniform. The manipulation process of textured yarns results in the modification and altering of the arrangement of fiber and yarn. )     Stretch Yarns may be applied to yarns by chemical or mechanical methods. Not all methods or fibers will achieve equality effective stretch properties. 4. 15: Discussion on new spinning systems Open-End Rotor spinning: The most successful of the new spinning systems is open end rotor spinning which is now termed as conventional spinning system. The success of rotor spinning is due to the increase of its productivity. Advantage of rotor spinning: 1. Lower labor cost 2. Less power consumption 3. Cheaper raw material 4. Larger package size 5. Higher productivity, because of higher speed 6.

Elimination of roving, no use of simplex m/c 7. easy handling Wrap spinning: The wrap or hollow spindle spinning system uses the tecjmoque of wrapping, a continuous filament yarn round a central core of parallel staple fiber and this system can be used for both short and long staple. Wrap spinning is considered as complementary to the ring and not a complete replacement. It is suitable for coarse count up to 30s. Friction spinning: The basic principle of friction spinning is that it is an opening system, the fibers are carried with an air flow forward the collecting area between two friction surfaces.

Friction spinning, like air jet spinning is limited in practice by the yarn quality. Finer count yarn produced in friction spinning than ring or Rotor spinning with comparatively production level. 4. 16: Textile Yarn finishing system ATM Yarn finishing starts after Ring till transfer to finished store For Hank form                                                   For cone form Figure: Process sequence of finishing 4. 17: Weaving and dyeing: Weaving is a method of fabric production in which two distinct sets of yarns or threads are interlaced at right angles to form a fabric or cloth.

The other methods are knitting, lace making and felting. The longitudinal threads are called the warp and the lateral threads are the weft or filling. The method in which these threads are inter woven affects the characteristics of the cloth. Cloth is usually woven on a loom, a device that holds the warp threads in place while filling threads are woven through them. The way the warp and filling threads interlace with each other is called the weave. The majority of woven products are created with one of three basic weaves: plain weave, satin weave, or twill.

Woven cloth can be plain (in one color or a simple pattern), or can be woven in decorative or artistic designs. As the final product of ATM is Lungi , it follows very easy method to complete the production process. 1500 shuttle and 250 shuttles-less weaving machine is used in weaving cotton gray and madras check fabric. Weaving back process Yarn –dying, sizing, checking design included to speed up and quality control. It produce two types of lungi. First type needs not to dyeing because it’s color is determined by yarn color. That means this type of Lungi’s color is automated by the color.

The second type of Lungi need dying. Because, it is made from the fabric. The fabric needs dying. Dyeing: Modern overflow and Jet dyeing machinery is used in latest rotary and flat bed printing process. 200000 y ds per week production capacity is running at 90% efficiency. Also traditional batik print is its specialty. 4. 18: Problems occurring in SCM and remedial measures of ATM: According to the second and third objective of the study, there is a discussion here about problems and remedial measures of SCM of ATM faced by the various participants in the factory.

Actually, problems occur in different sector of activities and the remedial measures are suggested by the various participants work in the sectors concern. These are narrated in below. Yarn Faults Some commonly occurring yarn faults and the methods of controlling them are as follows: a)     Slubs: Slubs are fish shaped thick places from 1 cm. to 4 cm. long and about 5-8 times larger than the average yarn diameter at the thickest portion. Slubs formed earlier stages due to poor drafting would get substantially elongated during I ring frame drafting and would get appear as slubs in the yarn.

It can be controlled in carding stage and then Ring frame. b)     Cracders: Crackers are short coil-like places in the yarn. Cracker occurs frequently in polyester or polyester-cotton yarns. Remedial steps: 1)     Increase top arm pressure 2)     Use large diameter and narrow width top rollers 3)     Ensure that the traverse motion functions properly 4)     Use of wider apron spacers 5)     Increase breaks draft 6)     Reduce twist in roving 7)     Wider back zone setting 8)     Use of heavier traveler 9)     Avoid stopping of ring frames. )     Spinner’s doubles: This fault consists of the yarn becoming double in its thickest at some portions. Causes: 1)     Rove from an inter bobbin in the creel at ring frame going along with the neighboring end. 2)     The ring frame tenter permitting doubled rove to be fed into the drafting system at the time of replacing a near empty inter bobbin in the creel. 3)     The strand issuing from the front rollers at ring frames going along with an adjacent end on the ring bobbin. Remedy: The ring frame tenter should be trained to replace the creel bobbin with a roper piecing of the rove and not by letting the fresh rove overlap with the in going rove at the feed. To transfer the lap from the lap pin to a lap rod to suitably handle and feed it to the subsequent m/c (carding) Action of Blow Room Line: 1. Action of opposing spikes 2. Action of air currents 3. Action of beaters 4. Regulating Action Wastage in Blow Room: 1. Droppings 2. Dust 3. Filter waste Faults in Blow: 1. Irregular lap 2. Knocking off before completion of full lap 3. Rough appearances of full lap 4. Lap sheet thicker at one side than at the others 5. Soft lap 6. Lap licking 7. Droppings under beater ;amp; grid bars. . Formation of conical lap 9. Formation of conical lap 10. Barrel shaped lap 11. Ragged lap selvedges. Types of Beater in Blow room: 1. Porcupine beater 2. Bladed beater l 3. Krishna beater Carding: Objects of carding m/c: 1. To open the tuft of fibers 2. To make the fibers parallel ;amp; straight 3. To remove remaining trash particles 4. To remove short fibers 5. To remove naps 6. To produce a rove like fiber called sliver, which is uniform in per unit length Main actions of carding machine: 1. Action between feed roller ;amp; taker 2. Action between taker in and cylinder 3. Action between cylinder and flat . Action between cylinder and doffer Useful sliver hanks of different counts: Count of yarn:                 10s,      20s,      32s,    40s,     60s,      80s Hank of carded sliver:    0. 125,   0. 125,  0. 13,   0. 135,  0. 145,  0. 165 Wastage in carding: 1. Taker in waste 2. Flat strip 3. Motes ;amp; flies 4. Sliver cut 5. Filter waste Draw Frame: Objects of draw frame 1. Straightening of crimped and hooked fibers 2. Paralleling of fibers 3. to produce more uniform of sliver of definite wt. / yd 4. To reduce the wt. /yard of materials fed. 5. To make perfect blending / mixing of the component fibers

Wastage in Draw frame 1. Filter waste 2. Clearer waste 3. Sliver cut Comber: Objects of Comber 1. To remove the fibers shorter than a predetermined length 2. To remove remaining impurities in the comber lap 3. To remove naps in the carded sliver. 4. To make the fibers more parallel and straight 5. To produce a uniform sliver of required per unit length. Necessity of Combing: 1. Clean fiber 2. Uniformity in length of fiber 3. Absence of naps 4. More parallel arrangement of fibers 5. Straight fibers The above quality of fibers can only be obtained by combing. Speed Frame: Objects of Speed frame: 1.

Attenuation of draw sliver to a suitable size for spinning 2. To insert a small amount of twist to strengthen the roving 3. To wind the twisted strand roving into a bobbin Operation involved in speed frame: 1. Drafting 2. Twisting 3. Laying out 4. Winding 5. Building motion Winding: If spinning tension is grater than yarn strength in Ring frame, then end breakage is occurred and also due to roller lapping A. Technological causes B. Mechanical causes A. Technological causes: 1. Insufficient twist in yarn 2. If travelers fly off. 3. Subbing through 4. Stretched roving 5. Faulty drafting roller setting 6.

Faulty Traveler selection 7. Excessive yarn tension 8. Improper atmospheric conditions B. Mechanical Causes: 1. Faulty drafting system 2. Worn out ring and traveler 3. Faulty gear and wheels 4. Worn out top rollers 5. Faulty apron 6. Spindle vibration 7. Eccentric ring Remedy: Both the Technical and Mechanical causes should be taken into account and be careful while winding. Chapter Five: Summary This chapter will discuss about some recommendations to conclude the study. According to the last objective of the study, it is needed to design a conclusion providing some recommendation to solve the problems identified.

In former portion of the study, some problems are shown regarding the SCM activities of the ATM. Some recommendation are narrated in below- 5. 1: RECOMMENDATIONS I have found a fewer number of factors, which impede the achievement of ultimate goals of Alaudding Textile (pvt. ) Mills Limited. It is not easy to find out the solution by only three months internship. But it can be said that the suggestions mentioned below will obviously increase the efficiency of ATM Limited. 1. Shippers must ship the consignment of cotton within the stipulated date as mentioned in the Letter of credit.

Delay in shipment shall be entertained without prior approval of the buyer for extension of shipment date. 2. Government should reduce tax and tariff on Textile spares, Textile dyes, Chemical and sizing materials. 3. A committee be formed with members from various importing and exporting countries to review the existing rules and procedures and suggest reformulation of mew rules due to changes that are being taken place in World Trade. 4. Arbitration Board to be reconstituted with members from buyers and sellers country and one to be inducted on the recommendation of ICA. . Arbitration to be held in the country of buyer. 6. Compensation to be paid due to supply of inferior quality cotton should be fixed on the basis of nominal rate fixed by ICA from time to time. 7. Membership fees should be reduced to attract more individual members. 8. The Spinning sector offers lower interest rate on long term and working capital. 9. The compensation as well the benefit package will restrain the employees to leave their assignment and go for any employee movement for higher benefit packages. 0. The Sector should prosper in a situation of political stability and a congenial business environment. Political turmoil and the disturbance are bad for the economy and so also for us. So, Proper steps should be taken by the government to keep this sector free from politics. Finally, the project should be equipped with world’s modern and latest machinery and   technology to cope with the pace in harmony with modern textile world. The Company should situate at a high land where less record of flood.

The factory building should have strong RCC foundation, RCC floor, pre-fabricated steel structure to withstand wind, storm, rain etc. along with good drainage facility. 5. 2: Conclusion Sophisticated technology and high thought laboratories have been introduce in the production process, which brought new dimension in the purchasing, procuring, storing and maintaining supplies and inventories. The improved transportation and communication as well as competitors threat has made the issue more challenging and competitive. Thus, the usage and need for supply chain management are increasing dramatically.

Further, global competitions require the companies’ continuous response to the customer with new products and replace those that become obsolescence, for these reason companies are combating to find new suppliers and building strong and long-term relationship with them. Hence, managers must have to very rational, logical and sensitive in designing and implementing proper supply chain management in order fight and compete against competitors and attaining organizational goals. Before selecting a supplier, a firm must decide whether it will use single sourcing or will have multiple suppliers from which to source the product.

Single sourcing is used to guarantee the supplier sufficient business when the supplier has to make a significant buyer-specific investment. Once suppliers have been select, contracts have to be structured between the buyer and each supplier. Supply chains can influence demand by using pricing and other forms of promotion. Marketing and sales often make the promotion and pricing decisions and they typically make them with the objective of maximizing revenue. Pricing decisions based on revenue considerations often result in a decrease in overall profitability Chapter six: Reference References:        Krajewski and Ritzman, Operations Management- strategy and analysis, 6th Edition ? Sunil Chopra, and Peter Meindl, Supply Chain Management- strategy, planning and operation, 2nd Edition ?       Khan ;amp; jain(2004), Financial Management-text ;amp; Problem,3rd edition, p. g 4. 1-4. 57 ? Prospectus of ATM, published on 18 September-2008. ?  http://www. itwm. fraunhofer. de/zentral/download/berichte/bericht26. pdf. ?  http://bgmea. com. bd/index. php? option=com_content;amp;task=view;amp;id=12;amp;Itemid=26 ? www. atmbd. com prospectus ?  http://66. 102. 1. 104/scholar? hl=en;amp;lr=;amp;q=cache:OKTGNo7eptwJ:unnayan. rg/Solidarity_Forum/Spinning_the_Chain_Lost_in_the_Queue. pdf+spinning+sector+of+Bangladesh Chapter Seven: Bibliography 7. 1: Bibliography A research was conducted in Makson Spinning mills Ltd by Student of BRAC University in Bangladesh:Prospectus of MSML, published on 18 September-2008 By Abu Zafour : Problems and Prospect of Garments Industry in Bangladesh (Part-7) Published 19 October 2009. By Kazi Anwarul Masud: istudy of Bangladesh Economy- Problems ;amp; Prospects with garments and textile industries- Part II on march 2010, the economic philosophy of textile industries in Bangladesh.

Draft final report on the situation of Bangladesh silk Industry-By The dyeing and finishing. Graham Heaslip: Strategy, Planning and Operation of textile Industries (School of Business and Humanities) 2007. Ning Cao, Zhiming Zhang, Chester To and Roger Ng : “Supply Chain Management Practice and Competitive Advantage in Textile and Apparel Industries” (Institute of Textiles and Clothing, The Hong Kong Polytechnic University) Pankage Chandra: “The Textile and Apparel Industry in Indian,” in The Oxford Companion to Economics in India, 2007. Professor of Operations ;amp; Technology Management)Manufacturing management; Supply chain coordination; Building technological capabilities; Hi-tech entrepreneurship in his research. Prof. Atanu Ghosh : “Supply Chain for the Apparel Industry – Some Tips” was published in RETAIL e-LETTER of the Retail Vision Group, Issue No. 21, 20th November 2003. Regarding textile industries SCM practices. Stanton, J, Willian, Michael J Etzel ;amp; Bruce J Walker, Fundamentals of Marketing, McGrow Hill, intentional Book Company, London. Chapter Eight: Appendices Questionnaire for the members participating in inbound activities

Dear Sir, I am a student of BBA program, Rajshahi University, is undertaking an academic internship program on the topic -“Supply chain management of ATM Pvt. Ltd. : A critical analysis” for this I need your sincerely co-operation in filling the following questionnaire, I assure that the information provided by you will be kept confidential anonymous and will be used for academic purpose only. Please give your agreement about flowing question carefully and give your answer. 1. What is the SCM system in this company? 2. What is the SCM managing policy? 3. What is the importance of IT in SCM in textile? . What is raw material used by ATM? Types of raw material? 5. Import of raw material. 6. How do you select suppliers and who are the suppliers? 7. Which are Banks involved in Import? 8. Process of raw material. 9. Is there any Safety management in production? If, yes, how? 10. Spare parts used in production 11. How is yarn constructed by this company? 12. Spinning system of this mill. 13. Weaving system of this mill. 14. Does Company maintain a good working environment? If yes why? 15. Does the company timely pay salary? 16. Inter-communication system among the department of the company. 7. Are all the SCM members co-operating to each other? 18. All the SCM members are contributing in creating companies goodwill. 19. Supplier supply materials properly. 20. Is Storage capacity of the company enough? 21. Does Company maintain proper inventory management? 22. Does The Company train the SCM members in adapting new equipment? 23. Are you satisfied about the company’s performance? Questionnaire for customer Dear Sir, I am a student of BBA program, Rajshahi University, is undertaking an academic internship program on the topic -“Supply chain management of ATM Pvt.

Ltd. : A critical analysis” for this I need your sincerely co-operation in filling the following questionnaire, I assure that the information provided by you will be kept confidential anonymous and will be used for academic purpose only. (Please indicate your satisfaction level about companies’ activities. ) 1. How much satisfied about companies’ communication system? i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 2. What is your opinion about price of the product? ) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 3. Satisfaction level about quality maintaining of the company. i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 4. Satisfaction level of product delivery time. i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 5. Providing transportation facilities of the company is? ) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 6. How much satisfied about compensation of defect product claim Maintaining? i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 7. Customer and company co-relationship level is? i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 8.

Supply of product in the market is? i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 9. Satisfaction about the availability Product varieties in market? i) Very dissatisfied ii) Somewhat dissatisfied iii) Neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied. 10. Satisfaction level regarding order receiving system. i) Very dissatisfied ii) Somewhat dissatisfied iii) neither satisfied nor dissatisfied iv) Somewhat satisfied v) Very satisfied