project report on garden silk mills limited

A

Summer Training Report

At

“Garden Silk Mills Ltd.”

Submitted By,

Akash .A. Shah [211]

Bhavik .A. Shah [214]

Under The Guidance of

Mr. Mayur Patel.

In the Partial Fulfilment of the Requirement

For Admission in “Semester V” in BBA Programme.

Submitted To,

Navnirman Institute of Management

(NIM-BBA), Bharthana, Surat.

Affiliated to VNSGU, Surat.

Academic Year 2011-2012.

NAVNIRMAN INSTITUTE OF MANAGEMENT

INDEX



SR. No. Contents Page No.

Preface I I

Acknowledgment II

Executive Summary III

Chapter-1 Introduction 1

Overview of the Industry 2

Overview of the Company 4

Chapter-2 Marketing and sales Department 10

Introduction 11

Structure of Marketing Department 13

Function of Marketing 14

Varieties of product 16

Packaging & labelling 17

Pricing policies 20

Segmentation, Targeting and positioning 21

Promotion Mix 22

Communication mix 25

Channel of Distribution 26

Comparison of 4 p’s With Competitors 29

Chapter-3 Production Department 33

Introduction 34

Structure of Production Department 35

Plant Layout 37

Material Handling Equipment 45

Process of Manufacturing 49

Production Planning 52

Inventory control 57

EOQ Model 59

Quality control 62

Cost Control 65

Chapter-4 Human Resource Department 67

Introduction 68

Structure of Human Resource Department

69

Human Resource Planning 70

HRP Process 71

Recruitment & Selection 73

Training & Development 82

Promotion, Demotion and Increment Policies

84

Performance Appraisal 86

Wage & Salary Administration 88

PREFACE

As a B.B.A. student, we have to undergo for two months Summer Training programme in any of the Renowned Company and we had got a chance to undergo Summer Training programme in Garden Silk Mills Ltd. We are here to take industrial training experience which introduced us new aspect and practical knowledge about different departments of Garden Silk Mills Ltd. Company & to prepare a project on it. Our Project covers all the Divisions of the company.

All the executive members of the company Co-operated us throughout our project by guiding us with their valuable advices. We are sure that this project will feed us the different dimensions of all the departments of management which includes:

Production Department. Marketing and Sales Department. Human Resource and Development Department. Finance Department.

We have collected all required information related to our project to our level best. It was a great experience to prepare the Summer Training project at Garden Silk Mills Ltd. Because till now we just got theoretical knowledge about different-different departments, but here we had practical base knowledge.


ACKNOWLEDGEMENT

We are highly obliged about the experience and the support given by all of the executive members of “Garden Silk Mills Ltd.” We would like to thank to our institute “Navnirman Institute of Management, Surat.” for giving us the opportunity to undergo Summer Internship. We are highly thankful to our institute professors & mostly our project guide “Mr. Mayur Patel” for giving us such a guidelines regarding the summer Internship.

We would like to thank “Garden Silk Mills Ltd.”, for giving us an opportunity to take an industrial experience about textile industry and about their processing management which includes Production department, Finance Department, Marketing and Sales Department and Human Resources & Development Department. We are very grateful to Finance Manager Mr. Bipin Modi and Mr. Avit Biyala of Marketing and Sales Department for their co-operation and guidance in our Summer Internship and providing us such a valuable experience which will help us to develop in our future career as well as for our skills and knowledge .We are very much thankful to our guide Mr. Rakesh Nayak of Human Resource Department who helped us for providing us time-to-time guidance in our training and we are also thankful to plant manager Mr. Hemant Patel for sharing their valuable practical knowledge with us.

We would like to thank all the executive members of garden vareli company, who directly or indirectly contributed in once or other ways in making this training more valuable with their information & suggestions.

Date: ____________.

-Akash .A. Shah [211].


-Bhavik .A. Shah [214].

EXECUTIVE SUMMERY

In today’s era textile industries are one of the largest industries in India and this textile industries are emerging highest growth in the market textile industries making good profit.

In Indian economy textile industries play a vital part and there is large and earn also. So to understand this I wanted to make a project report in any leading company in this industry.

Clothes are a necessity in the day to day life of a person. It has its importance in all age from infants to adults to old ages. Because it holds such an important position we decided to take our Grand training project on Garden Silk Mills Ltd.

The company deals with the production of POY chips, yarns, sarees & dress materials. The project highlighting is the important of Working Capital Management. Various departments were studied in the course of the project which include in order taking system, the standardization processes, the purchase department, finance department.

From the study conducted & analysed so far, it can be conclude that, organization provides various facilities to their employees. They treat their employees as a family member that results in success of the company. The company believes that employees are the main property for them, so they have to take care of them by various programs. This study report is prepared to encovers with every aspects of management done at Garden Silk Mills Ltd. By the study of various department we observed that the entire department are managed, arranged, scheduled properly, so that the employees cannot feel difficulties in working. During this vocational training we had a very good experience that increases our knowledge.

It was a great honour to get training under this company and we also found that the Garden Silk Mills Ltd. has a good reputation in the market about their quality of product.


Indian Textiles Industries

Cotton Textile JuteWoollenSilkMan-Made

OrganizedSector

Power loom (Cloth) Hand loom (Cloth)

Decentralize Sector

Cotton Mills (Private Public & co-operative)

Spinning mills(Yarn)

Composite Mills(Yarn & Cloth)

OVERVIEW OF THE INDUSTRY

India Textile Industry is one of the leading textile industries in the world. Though was predominantly unorganized industry even a few years back, but the scenario started changing after the economic liberalization of Indian economy in 1991. The opening up of economy gave the much-needed thrust to the Indian textile industry, which has now successfully become one of the largest in the world.

India textile industry largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns about 27% of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 3% to the GDP of the country. India textile industry is also the largest in the country in terms of employment generation. It not only generates jobs in its own industry, but also opens up scopes for the other ancillary sectors. India textile industry currently generates employment to more than 35 million people. It is also estimated that, the industry will generate 12 million new jobs by the year 2010.

Various Categories under which Indian textile industry can be divided into several segments are as follows:-


India textile industry is one of the leading in the world. Currently it is estimated to be around US $ 52 billion and is also projected to be around US$ 125 billion by the year 2013. The current domestic market of textile in India is expected to be increased to US$ 65 billion by 2013 from the current US $ 45.6 billion. The textile export of the country was around US$ 19.14 billion in 2006-07, which saw a stiff rise to reach US$ 22.13 in 2007-08. The share of exports is also expected to increase from 7% to 10% within 2013.

Strengths

Vast textile production capacity. Large pool of skilled and cheap work force. Entrepreneurial skills. Efficient multi-fibre raw material manufacturing capacity. Large domestic market. Enormous export potential. Very low import content. Flexible textile manufacturing systems.

Weaknesses

Increased global competition in the post 2005 trade regime under WTO. Imports of cheap textiles from other Asian neighbours. Use of outdated manufacturing technology. Poor supply chain management. Huge unorganized and decentralized sector. High production cost with respect to other Asian competitors.

Current Facts on India Textile Industry

India retained its position as world’s second highest cotton producer. Acreage under cotton reduced about 1% during 2008-09. The productivity of cotton which was growing up over the years has decreased in 2008-09. Substantial increase of Minimum Support Prices (MSPs). Cotton exports couldn't pick up owing to disparity in domestic and international cotton prices. Imports of cotton were limited to shortage in supply of Extra Long staple cottons.


OVERVIEW OF THE COMPANY

Garden Silk mills Ltd. group of companies, one of the leading industrial groups in India, plays a leading role in the field of POY yarn and fashion fabrics. With annual sales exceeding U.S. $ 90 million, they sell their products under a single banner of quality ‘Garden’.

Garden Silk mills Ltd. is public limited company incorporate on July 23, 1979. It was authorized share capital of Rs. 60 crores, Equity shares of Rs. 10 each, out of which around Rs. 3, 82, 90,560 have been issued, subscribed and fully paid up. The shareholders here have seen much appreciation and received regular dividends which impose that the company is getting on prosperous year and is profit making venture. This is attribution to the three generation of the directors who have strived hard for the growth


and progress of the company. The company has also seen much of highs and lows of the market and has successfully come out of all those, providing it to be a leader of textiles business of all times.

In 1975, the company recruited Fine Arts Graduates from leading institutions and an Art studio was set up. The company started introducing its own designs and supplied these designs in the market. Prior to this, the designs produced had been a function of customer demand and from this point onwards, the emphasis changed the design impetus coming from manufacturers.

Garden Silk Mills Ltd. is one of the leading & oldest manufactures of synthetic in India. In the late 1970s, the company started exporting its products to European Market, Given the size of the domestics market, the proportion of the product that are exported remain low at approximately 2% The Company is in the process of further developing market in Africa, Central and Eastern Asia. The company has made vertical & horizontal integration from its establishment.

In the 1980’s, the company developed a new site-Vareli, some 12kms away from Surat. This has become the manufacturing plant and investment of more than 2 billion has been made. Most of this expenditure has been targeted at the expansion and modernization of plant and equipment, particularly in the weaving and yarn preparatory sections. As a result, the company today has one of the most modern and sophisticated textile plants in India. It achieved ISO 9002 on February, 2000, which was its greatest achievement, and Garden Silk Mills become the first company ever achieve such creation in Surat. This has brought fame to the city and to the nation all through the international sales and export income has been considerable.

Today, the company is one of the largest manufacturers in India of high fashioned, premium quality, dyed and printed textiles fabrics, both polyester and viscose comprising a range of chiffon and georgettes, crepes and faithful ladies, fashion as well as Indian sarees, The company also manufacturers an exclusive range of pure silk and cotton fabrics.

The company is largest manufacturer of POY and PFY in India. The company is the competitors of RELIANCE. The company’s strategy is not to be top in the POY, but they are interested in to make the quality product which satisfy the customer needs at the most.

Achievements:-

The company is the first to set up a polyester filament yarn project in south Gujarat. The project is capable of producing multifilament and microfilament yarn having capacity of 5000 tons p.a. in collaboration with NOYVALLESIVA AG of Switzerland.

Now a day’s company increase POY Spinning capacity from 7200 metric tonnes to 32200 metric tonnes per annum and secondly company increase Draw Extrusion from 13 to 17 i.e. instalment of 4 machine and also increase Draw Warping machine from 7 to 9 machine. The project has a special significance for the company, as polyester filament yarn is the basic raw material for the product for manufacturing man made textile.


Objective Of The Company

To ensure the quality of the products To establish good industrial relation with customers and get a quick responsible feedback from

customers. To provide the different types of clothes to the different customers To motivate employees in the right way and provide training and development programmes. To provide harmony and safe working condition to employees. To sell capital goods by which the customer can earn profit and also satisfy end customer. To maximum use of appropriate technology and information. To establish reliable contact with sub-contractor. To adopt better productivity through which it can be possible to reduce cost, rework and rejection. To expand the business for more production and market share. To make good quality product & supply it on time to customers.

Garden Silk Mills Limited.

Date of Listing (NSE) : 01-Apr-2003Face Value : 10.00ISIN : INE526A01016Industry : TEXTILES - SYNTHETICConstituent Indices : CNX 500

Issued Cap. : 38290560(shares) as on 14-Jun-2012Free Float Market Cap. : 161.97(Cr) as on 14-Jun-2012Impact Cost: 2.27 as on May-2012


52 week high/low price : 103.00/40.10

Locations of offices, branches & factories:-


Registered Office

Garden Mills Complex, Sahara Darwaja.Surat - 395010Gujarat - IndiaPhone : 2311513, 2311197. Fax : 2311029/502Email :[email protected]

Factory/plant

Village Jolwa Taluka Palsana Surat District - 394305 Gujarat - India Phone : 271287-271289

Factory /plant

Vareli Complex Village Vareli, Taluka Palsana Surat District - 394327Gujarat - IndiaPhone : 271241-47

Corporate office

Manek Mahal 90, Veer Nariman Road, Churchgate Mumbai - 400020Maharashtra - IndiaPhone : 22873117-19Fax : 22048112Email : [email protected].

Details of promoters and owners:-

NAME DESIGANATION

Praful A Shah Chairman and Managing director

Shilpa P Shah Executive Director

Suhail P Shah Executive Director

Arunchandra N Jariwala Director

Yatish Parekh Director

Smita J Shah Director

Anjan Mukherjee Nominee Director

Alok P Shah Joint Managing Director

Sanjay S Shah Executive Director

Rajen P Shah Director

J P Shah Director

Sunil S Sheth Director

Madanial U Lankapati Director


Corporate office

Manek Mahal 90, Veer Nariman Road, Churchgate Mumbai - 400020Maharashtra - IndiaPhone : 22873117-19Fax : 22048112Email : [email protected].

Comp operators

.

Top management(All partner)

Managing director

Chairman

General Manager

Production Selling Finance Human resource

Manager

Asst. manager

Workers

Manager

Staff

Manager

C.A.

Asst. manager

Manager

Asst. manager

Sales executives

Organization structure:-


Under the Guidance:- Mr. Avit Biyala (Senior Manager).

INTRODUCTION


Marketing is a societal process by which individual and group obtain what they need and want through correcting, offering, exchanging products and service of value with others.

The aim of marketing is to know the customers who want who want to buy the product and up to what extent he is interested in the product. The marketing Dept. however should convince the customer to buy the product.

Without efficient marketing no company can survive. The product should be sold as fast as possible compare to the production. Otherwise it may cause some financial problem which may lead to certain loss. More and more amount of money get blocked in the stock of a finished product. So the marketing should be strong to achieve the organizational ultimate goal.

MARKETING PROCESS:-

The Marketing Process has mainly two Fashions of the Products are as Follows:-(a) New Design:-

Some Variety of Design is launched in the Market. The Designs are Developed According to the Trends in the Market and Prevailing Season. The Developed Design is sent to the Prevailing Season and also the members of the Distribution Channel.

(b) Report Order:-

After the Order is placed, it is consolidated throughout the Country. The Order is carried out according to the Capacity of the Machine. Maximum Production Capacity is kept in Mind.

Business to business marketing:-

Business to business (B2B) marketing defers from marketing pointed to customers (B2C). B2B marketing is more complicated than B2C because it is pointed to a number of decision takers. When B2B is done in markets with few factors it is extra important that the selling supplier has an established and as well as developed contact with the buying companies plus have the possibilities to offer customer


made prices and products. To know which marketing method is the most effective in a market, the company needs to know the buying companies demand and the structure of the market.

To be able to fulfil this demand the supplier needs to have information about

In which business it is in? Potential customers in the market? How should the company be organized to sell the most products? How to create competitive advantage against competition?

Understanding the markets:-

To increase the market share of the company it is very necessary to have the understanding of market, it will helps the company in many ways to increase the sale of company, profitability and in increasing markets shares.

Understanding of market includes the following:-

The market size Information about customers needs, perception and customer behavior Information about the product (units sold and net profit per unit) Competitions, their size, objectives, market share, product quality and marketing strategy. Distribution, scales in each distribution, relative active importance of the different channels,

price and commercial laws and reputation.

Structure of Marketing Department


ProgrammerManager

DispatchManager

General Manager

Deputy GeneralManager

Senior GeneralManager

AssistantManager

RESPONSIBILITY: - NAVNIRMAN INSTITUTE OF MANAGEMENT

They are responsible to satisfy the customer requirement by adopting better quality of product. They are directly responsible to the general manager and the proprietor in-charge. They are responsible to increase the volume of sales. They are responsible from inquiry of goods & it’s delivery to their customer. They are responsible for the proportion of discount policy. They are responsible for checking the account of customer. They are responsible for attracting new customer for their product. They are responsible to give the best advertisement in different media through which attracting

number of customers.

Functions of Marketing

There are two types of functions in marketing Department:-

1) Routine Function Receiving inquiry from the customer Sending quotation to the customer Receiving order from the customer Concern production Dept. for special requirement Prepare schedule for production Dept. Receiving the final goods as per requirements Dispatching goods to the customer Receiving payment & maintaining payment details Writing circular to the customer whenever needed Sending reminder to the customer

2) Specific Function This Dept. gives suggestions to make improvement in system to Mgt. whenever required. They perform personal follow up to production Dept. for preparing best to satisfy them. They understand the special requirement of the customer & try their level best to satisfy them. They establish personal contact with their customer. They always try to provide better service to the customer. They submit monthly report of sales & payment received to the general manager. They try to achieve target set by the Mgt. Head of the Dept. attend weekly meeting with the different Dept. head & general manager.


Other functions are:-

Merchandising: -Matching the products to customers needs & desires (the market requirement). Pricing:-Determining the optimum price. Promotion: - Persuading the buyers to favours the firm & its products.

Physical distribution:-The transport, warehousing & inventory control.

Product Mix

“A product mix is the set of all products and items a particular seller offers for sales.”

The GARDEN JOLWA have also many kind of product related to POY. But the main product is the POY. This company produces all the type of different goods according to the demand of those goods. The company has the great market after the RELIANCE. The list of some product of the company is as follow:-

1. POY (partially Oriented Yarn).

2. Textured Yarn.

3. Draw Tex Yarn.

4. Full Draw Yarn.

5. Draw winder.

The Garden Company also has to produce many of Products in fabrics. We show the product mix of the company, Hear show the company’s product width, Length & Depth of the product mix.

Width:- The width of product mix refers to how many different product lines the company carries.The Garden Company carried four product widths.

Length:- The length of product mix refers to the total number of items in the mix.The Garden Company Carried 17 Lengths.

Depth:- The Depth of a product mix refers to how many variants are offered of each product in the line.

The Garden Company has Five Depths for each product length, which are as following: ~

Orient. Sixties Grams. Brasso. French crapes. Kasturi.

Variety of Products:-


Products

Chips Dress MaterialsSari Marble Cheeks

Polyester Chips Nara ChiffonAmerican ChiffonSeta ChiffonsMarble ChiffonPeachSilk Crepe linenSeta georgettes

JacquardsDecline

China Yarn SariDeclineBrasso

Heary out mationUetra satvarlo

LapurBlack-perl

Alfine & Chera

Product life cycle:-

A company’s positioning and strategy must change as the product, market, and competitors change over the product life cycle. To say that a product has a life cycle is to assert four things.

1. Products have a limited life.

2. Product sales pass through distinct stages, each posing different challenges, opportunities, and problems to the seller.

3. Profits rise and fall at different stages of the product life cycle.

Product requires different marketing, financial, manufacturing, purchasing, and human recourse strategies in each lifecycle stage.


There are four stages of Product life cycle like:~

1) Introduction Stage: - the stage where company introduce itself in the market.

2) Growth Stage:-In this stage, a product of rapid market acceptance and substantial profit improvement.

3) Maturity Stage: - In this stage, sales growth of product is slowdown, the product has achieved acceptance by most potential buyers. Profits stabilize or Decline because of increased competition.

4) Decline Stage: - sales show a downward drift and profit erode.

The GARDEN Company has suffered in the maturity Stage of the product lifecycle. According to maturity stage position, the company’s products like Jacquard viscose pallu material sarees, dresses etc cover large market but nowadays the customers of the company want innovation in the company’s product. So the GARDEN Company needs to modify its Products and it Produce Jacquard Brasso.

Marketing Strategies of the company

The GARDEN Company has suffered in the maturity Stage of the product lifecycle. So that the company follows maturity stage’s marketing strategies which are the following hear:-

In this stage, the company needs to diversify brands. So that the GARDEN Company changes their brand name Garden Vareli to only GARDEN. The company needs to change product models. And Product quality Jaquard viscose pallu to Jaquard Brasso. In this stage company also follow the competitor’s price and also reduce the Price of the product. Nowadays the GARDEN also follows these strategy. The company increases its retail shop in the market like 25 shops. Garden operates through franchisee operations with outlets in about 104 locations across the country and six company-owned showrooms. The company holds 20-day discount sales twice a year at all its outlets. Garden’s earlier target customers were working women who were urban, educated and fashion conscious, in the 20 to 60 age bracket.

Packaging:-

“Packaging is the buyer’s first encounter with the product & is capable of turning the buyer on or off”.

The GARDEN Company use primary types of package to sell its products. The Company can use these types of strategy of packaging like:-

Single suit packing in Plastic bag.

Single suit in boxes (plastic Boxes or paper boxes).


Size of Packaging:-

Single packing in plastic bag packaging: 2.78metre is maximum size (general size).

Single packing in boxes packaging: 2.0, 2.28metre.

While packaging the sarees, the company uses quality-packaging materials like polythene sheets and others. This assists in ensuring the safely of the end products during the transits period. Our entire packaging process is conducted under the supervision of our experienced packaging personnel, Further; the company has association with various transportation and logistic agents, which helps us in smooth and prompt delivery of the range to the final destinations. This ensures the timely delivery of our consignments to the clients.

LABELLING

“Label is a part of product, which carries verbal information about the product or the seller.

It may be a part of package, or it may be a tag attached directly to the product .” Label may be a

small slip or it may be a attached to the product. It conveys verbal information about the product and

seller. The producer gives necessary information to the consumer through the label. The act of attaching

or tagging the label is known as labelling. Label is of three types:-

BRAND LABEL :-It is simply popularizing the brand name of the product. It gives only the

brand names.

GRADE LABEL :-It identifies or emphasizes the quality standards or grades, as A,B,C OR

1,2,3 etc. In another word it, identifies the quality.

DESCRIPTIVE LABEL :-It gives written or illustrative objective information about the use,

care, performance and other features of the product.


A COMPLETE LABEL GIVES THE GARDEN SILLK MILL

Brand name.

Address of the product.

Gross & net quantity of the content.

Ingredients in the product.

Direction for the use.

Precautionary measures.

Nature of the product.

Date of packing.

Retail price.

BRAND

The word “BRAND” has its origin in the Norwegian work “BRAND”, which means to burn. In ancient, framers used to put burn marks as identification on livestock to distinguish their positions.

A brand is a “name, term, symbol or design to identify the goods or services and to differentiate them from those of the competitors”.

A trade market is a brand that has been given legal protection, ensuring its use exclusively by one seller. Trademark is a legal term, while brand is a marketing term. In marketing, the brand name is a major selling tool and one of the most important components of the ‘total product personality’. We are, in fact, living in an age of brand. the intensive brand promotions undertaken by marketers of various products have made consumers extremely brand-conscious.

The battle in the market takes place not between companies, but between brands. Consumers buy brands; and generate income for the firm. It means that developing strong brands is a major responsibility of the firm.


PRICE

Price shows the value of the company’s product. The Co. itself decides its product price considering various factors. Garden’s product is less priced than that of Reliance & which is the 2nd

highest price in the market. These 2 competitors play a major role in the market according to their product’s price.

OBJECTIVES OF PRICING

Earning of reasonable rate of return on investment.

Market penetration.

Price stability.

To maintain or improve market share.

To cope up with competition.

Market skimming.

Profit maximization objective.

Pricing Strategies

Price shows the value of the company’s product. The company itself decides its product price considering various factors. The price of GARDEN Company is less than the Reliance and which is the second highest price in the market. These two competitors play a major role in the market according to their price of the products.

“Pricing is just not a number on a tag or an item. It represents the product in a very large way.”

Pricing policy of the company usually stable, it does not keep on fluctuating with time and the price is decided after taking into consideration the price of its competitors.

According to the company the price of the finished product is decided on the basis of the price of its raw material. Say for example if the demand of petroleum is increased or decreased then it consequently affects the price of the raw material and also the price at times depends on the demand of the product also.


The price of the company changes, when the yarn market is in boon period the price tend to be high and vice-versa.

The Garden Company follows this pricing policy:-

PRICE=COST+MAGIN+BRAND EQUITY

This Criterion is called forward pricing. However, In Cutthroat Competition, Garden has Adopted Backward pricing, I.E. First of all, they determine the Price at which it can be sold having deducted the required margin from the basis of which it achieves the cost. Then it strives to reach the determined cost. It assists the company in Effective cost control in reducing Wastage.

For Wholesome Customer, There are two types of discount. That is trade discount and cash discount. Garden has motivating discounting policy rather than threatening one.

To Pay the bills in 30 days or to pay 2% interest after due date.

To pay the bill at last in 60 days and if you pay bill a month early you will get 2% discount.

Generally, the payment period of Row material as well as credit period for finished products is 60 days due to competitive Market However, It is not Rigid; It Changes As per the Demand-Supply position of the market of a particular product.

CUSTOMER SEGMENTATION

Customer segmentation can be identified by examining demographic, psychographics, and behavioural differences & geographic. The marketers then decide which segment presents the greatest opportunities that are its target market. For each chosen target market the firm develops a market offering.

Garden silk mills sell its product in both local and foreign market. So we can say that Garden silk mill has geographic segmentation, which call for dividing market unit such as nation, state, countries, and cities region etc. Garden silk mill has good opportunity in foreign market.


TARGET MARKET

A target market or target audience is a group of customers that the business has decided to aim its marketing efforts and ultimately its merchandise. A well-defined target market is the first element to a marketing strategy. The target market and the marketing mix variables of product, place (distribution), promotion and price are the two elements of a marketing mix strategy that determine the success of a product in the marketplace.

To sell their product at maximum efficiency they have to consider the different segment of the market. And this segment of the market is known as the TARGET MARKET.

In other sense if we say that every company have their target market in which they sell their product at maximum level and low at other place.

The target market for the GARDEN JOLWA is the SURAT at maximum. They sell their product in SURAT more. Then they sell at other city of GUJARAT. But here sell is not so more as in SURAT. The next they sell their goods in some city of MAHARASTRA also. And also they sell some product in other state of INDIA. They also export their goods but at a very little scale.

PROMOTION MIX

“promotion mix means a set of elements or tool like advertising, public relation and publicity, sales promotion, personal selling and direct marketing used by the marketer for promoting sales by stimulating demand through persuasive communication.”

ADVERTISEMENT AND PROMOTION POLICIES

Advertising can be used to build up a long term image for product. The sales of a product can be increased to a great extent with the help of advertisement. But, usually advertisement is done for the consumer products. But GARDEN is mainly dealing with yarn, a raw material for fabric. They usually deal with dealers so there is no need for any kind of ads, as it is an industrial product.

Advertising offers a reason to buy and sales promotion offers an incentive to buy. Promotion is nowadays more accepted by top management as an effective sales tool. The companies are


http://en.wikipedia.org/wiki/Marketplace

http://en.wikipedia.org/wiki/Marketing_mix

http://en.wikipedia.org/wiki/Price

http://en.wikipedia.org/wiki/Promotion

http://en.wikipedia.org/wiki/Distribution_(business)

http://en.wikipedia.org/wiki/Place

http://en.wikipedia.org/wiki/Product

http://en.wikipedia.org/wiki/Marketing_strategy

http://en.wikipedia.org/wiki/Merchandise

http://en.wikipedia.org/wiki/Marketing

http://en.wikipedia.org/wiki/Business

http://en.wikipedia.org/wiki/Target_audience

under great pressure to increase their sales as numbers of competitors are also increasing. The industrial products manufacturing also do more or less promotional activities.

The company always tries to promote the product in the way by which the price of the product is tried to maintain or reduce and the quality is improved so that they can offer better product to their customers. They also do trade promotions like giving free yarn samples and prices off.

BUDGET FOR ADVERTISEMENT: -

Every organization decides their amount or budget for advertising in advance. But it isn’t possible in every situation. Sometimes company may not be in a position to decide, budget for advertising in advance due to certain reasons.

Previously Garden Silk had fixed budget for advertisement. In the year 1993-94, the company provided Rs. 8, 69,000 as expenditure of advertisement, while in the year of 1994-95, the company has provided Rs.14, 52,000 as expenditure of advertising. But at present it is not fixed.

MEDIA FOR ADVERTISEMENT:-

Media is a means through which advertisement passes to consumers & by which consumer knows about product & its features. Garden uses different media for advertisement like dairies, textile-magazines, seminars, demonstration, Internet & other business magazines. Thus, Garden, does not more emphasizes on advertising because it produces industrial goods & it’s a long term buying decision & there is no regular customer for industrial goods.

PROMOTIN POLICY:-

Sales promotion is termed as, “The Promotional Activities other than personal-salesmanship, advertising, publicity, which stimulate consumer purchasing & dealer effectiveness such as displays, exhibitions, demonstrations, contest & various other non-recurrent selling effort not in the ordinary routine.” The difference between sales promotion and advertisement is that advertising offers the reason to buy while sales promotion offers an impulse to buy. In Garden, there is long term planning for the sale of its product. Garden has slogans “You fascinate me” and “Garden creates new woman” which are impressive & attracts women consumers.

There are three types of sales promotional tools: -

consumer promotional tools trade promotional tools business and sales force promotional tools


Consumer promotion tools:-

Samples: -

Samples are offered to its retailers, i.e. in terms of returning the sarees with its particular design not liked by the retailer or wholesaler. This is in the case of marketing of sarees only.

Free goods: -

To pace with volatile taste and preference of the consumer the company has to know the current consumer market. Hence, a questionnaire is prepared including the customers’ choices and market demand with options for answers. If the questionnaire is completely filled up and submitted by the customer, she will get one scarf free. On the basis of response and analysis of the data, the management decides to change its product.

Premium (gift):-

The customer who buys direct from the company’s shop is given impulses by offering them free premiums or gifts.

On buying products up to Rs. 1500/-, buyer gets 2.5 mts. fabrics in the form of top-bottom clothes.

On buying products up to Rs. 3000/-, buyer gets 5 mts. fabrics in the form of top and bottom clothes.

On buying products up to Rs. 4000/-, buyer gets complete Duptta set, which consist of a complete dress for her. Thus the scheme is very effective.

Discount: -

Usually, quantitative discount is given to its retailers to infatuate and vigor to buy the product of the company.

Trade Promotion Tools: -

Buyback Guarantee: -

The company also gives full buyback guarantee to its retailers or wholesalers, i.e. defected goods are purchased back by the company.

Price Off: -


The company often has to offer price off to its retailers or wholesalers to carry a particular brand. The company offers price off in terms of discount on the basis of amount of sales of retailer’s sale in more than current month then management give more discount to retailer or wholesaler.

Business And Sales Force Promotion Tools:-

These tools are used to overhaul the business, sway customers and motivate sales force to greater efforts.

Trade show: -

The company takes part in the annual trade show organized by the Textile Industry Association in Delhi every year. Apart from it, the company also organizes a show named as, “Text Style” which is a sort of fashion only for the products of the company.

Communication mix

There are several platform of communicate with customer, which is live Advertising, Sales promotion, Public relation, Personal Selling, Direct marketing.

The Garden Company uses several platforms to attract the customer like Advertisement, Sales promotion, direct marketing. These all are the medium in which company communicate with their customer.

1) Advertisement: Company Give advertisement in the news channel likes CNBC, NDTV (for selling POY) & radio (My FM), Internet, etc.

2) Sales Promotion: Company Also use these plat form to attract the customer, after some time company give discount of their customer. In current date the Company gives 40% discount for its loyal customer in Bombay.

3) Direct marketing: Garden Company also focus on the online marketing for its business customer to direct sale the yarn or fabric through its sites.

The Garden Company also publish magazine during the Dipawali time to attract the customer.


EXPORT MARKETING

From Mumbai office the material is sent to foreign office.

Customer gives order at the foreign office.

Material is supplied to customer.

CHANNELS OF DISTRIBUTION

There is usually a Large Channel of Distribution. Which Includes from Manufacture the Product? The Manufacturer sells it to Wholesalers and the Wholesalers give it to the Retailers and finally Retailers is selling it to the Consumer. It’s also described in this way.

The main Product of the Company is POY. Which are the Industrial Product and the Distribution Network of the Company is not Complex. In this Network each stage has Involve only one Person who is known as “DEALER”. DEALER is between the Manufacturer and Wholesalers, also between the Wholesalers and Retailer, also between the Retailers and Customers.


MANUFACTURERDEPOTS

(COMPANY'S WHOLESALER)

DEALERS

RETAILERSCONSUMERS

“DEALER” has Play a very important role in this Distribution Network. Generally, so many Companies are Deals with the Dealer .The Dealers sales the Product to the Industrial Customers and he mainly acts as a Guarantee on behalf of the Customers for the Payment of the Company. The Dealer also has the Information about the Customers needs, New Fashions, Variety etc. is providing to the Company.

The Distribution Network looks like as follows:-

The GARDEN Company Sells their Product by Dealers only. The Dealer gets the Commission from the Company and also from the Customers. The Dealers Network is in Gujarat, Maharashtra, and Rajasthan etc.

Some Names of the Dealers are as follows:~

Gheewala Brothers

Ekta Textiles

Anudhara Textiles

The distribution network is look like as follows:-


MANUFACTURER DEALERS CONSUMER

Packing Department

Marketing network encompasses:-

Globally, GSML has product presence in countries that includes U.K., France, Spain, Portugal, Greece, Middle East and Gulf countries, the U.S.A., Australia, Singapore, Thailand, Hong Kong, Mauritius, South Africa and Brazil etc.

The company‘s network encompasses in over 65 cities in India. 68 dealers. 18 company owned depots. 300+ Retail outlets.

View Garden Depot Locations:-

View Garden Retailer Locations:-


Spotsale

Dealer

General Shop

Depots

Authorized Retail Shop

AuthorizedRetail counter

Company Shop

Consumer’s consumer’s consumer’s consumer’s

NameAddress:CityState:Dealer Type:

Garden Silk Mills Ltd,M-1270-71, Ground floor Surat Textile Market,Ring RoadSuratGujarat Depot

Name:

Address:

City:

State:

Dealer type:

Name:

Address:

City:

State:

Dealer Type:

Garden – Vareli Retail Shop,

Shop No. 26/28, Bombay Market,

Umarwada,

Surat,

Gujarat

Retailer

Amber Main Road, Limda Chowk, Opp. hhakkapir Galli,

Surat

Gujarat

Retailer

COMPARITION OF 4 P’S WITH COMPETITORS

Four products of the company are given below:-

(1)Product

(2) Price

(3) Place

(4) Promotion

The Whole Company is Greatly Depends upon those 4 P’s. The main Product of the GARDEN SLK MLLS is Polyester Yarn which is the Raw Material for Production of the Fabrics.

Products

Product is a main part of the Company. The Product must satisfy the needs of its Consumer. GARDEN SILK MILLS Produce Polyester Yarn which is an Industrial Product. The Company makes the Product as per the needs of its Consumer. So many Competitors in the market but the Strong Competitor of the “Garden Silk Mills” is “Reliance “, which Produces the same Product.

Price

Price Shows the Value of the Company’s Product. Every Company’s Product Price is Depends on the Consumer Demand. When We Compare to the both Company in a Pricing level then we can say that Price of the GARDEN Company is less than then the RELIANCE Company. These Two Competitors Play a Significant Role in the Market According to their Price of Their Price of Products.

PLACE NAVNIRMAN INSTITUTE OF MANAGEMENT

Physically Distribution is the Delivery Products at the Right Time and at the Right Place. The

company has Selected Different -Different Place for the Different- Different Department to sell its products like The Marketing Department is in “SURAT”, because there is a High Demand of Yarn in “SURAT” as it is known as “TEXTILE CITY”. The Production Department is in Vareli and The Sales Department is in Mumbai, Bangalore etc. The Company also sells its Product to the Foreign Countries.

PROMOTION

The Firm also must undertake Promotion Work likes Advertising, Publicity and Personal Selling etc. The GARDEN SILK MILLS manufactures Synthetic Yarn and Fabric which is the Industrial Product. The Company does Promotional Activities through Electronic media, Print media, Hoarding, FM radio, etc. They Sell Their Product through a very strong network of Dealers across the country which Play very significant role between Manufacturer and Customers.

Marketing Environment (competition)

Competitors mean the person who is making the product which is similar to ours. Means that product can be a substitute for the customer. For the success of all the company they must the knowledge about all the competitors. They always keep an eye on every movement of the competitors.E.g. The Company says that Pepsi Company always watches the movement of the coca-cola company. They must have to watch their competitors to survive in the market.

In that way the GARDEN JOLWA have also its competitors. So, they have to be very careful about their competitors. On the one side there are seven lacks small and big competitors of the company in industry for different activities purpose situated in Surat but on the other side there are no any competitors of the company for whole activates purpose of the company because the company passes maturity stage in the product life cycle, in which one of the king is the company. One of the biggest competitors is the RELINCE. There are also other competitors, but they are small.

The GARDEN Company has two types of competitors, which are following hear: ~

1) On the basis of selling yarn:~ Gupta Synthetics. Indo-Rama Synthetics.


JBF industries. Modern petrofils. Nova petrochemicals. Century Inka Chideepal.

2) On the basis of selling clothes: ~ Surbhi textile. Laxmipati textile. Sayba textile. Parag Textile.

So we can say that there no competitors of the company for whole activities like producing yarn, fabrics etc, but seven lakes competitors for different activates.

Consumer buying behaviour & Industrial buying behaviour

“Consumer buying behaviour is a study of how individual a group & organization select, buy, use and dispose of goods, services, ideas or experience to satisfied there needs and wants.”

Process of Consumer buying behaviour:-

Problem Recognition:-

The buying process starts when the buyers recognize a pa problem or need triggered by internal. Our companies try to recognize the problem of the customer like which kind of product customer want & which types of services costumer want at the time of purchasing the product.

Information Search:-

The consumer often search for limited amounts of information the consumer try to collect information every medium like pamphlets, magazine, friend, family, Advertisement, etc. so that company use these kind of medium. Mistily company uses the medium of magazine, pamphlets.

Evaluation of alternatives:-

Consumers evaluate different types of product for the buying. So that the company can attract consume through advertisement.


Purchase decision:-

In this stage, consumer may make up to five sub decision like brand, dealer, quantity, timing, and payment method, So that the GARDEN Company try to maintain these all five things.

Industrial buying behaviour

The GARDEN Company attract their industrial buyers through some medium like Money control, NDTV, the companies own site etc. There is no special activity done by the companies marketing department to attract industrial buyers. The company sells its industrial product only limited business, which is deal with the company. And the company sells yarns only fix quantity, which is not use in the company to produce cloth. Hear give the names of some small textile unit, which is purchase yarn for company in current time.

Name of Industrial buyers of the company :-

NO

Buyers Person in Charge

Product

1 Nakoda Textile Industries Ltd. Badudhai Polyester Chips

2 Mohit Textiles Ltd. Narayan saboo Polyester Yarn

3 Tawalwasia Yarn Sumitdhai Polyester Yarn


4 Prasant Textile Vallabhbhai Polyester Yarn


Under the Guidance:- Mr. Hemant Patel (Senior Engineer).

INTRODUCTION

Production is the process of converting the raw material & other inputs into the products for further production or finished goods or services so that the utility of inputs is created or enhanced & needs of the customers are satisfied.

Management creating & maintaining an environment in which individuals working together in groups willingly contribute their best to produce the specified good by optimum utilization of raw-materials & other inputs so as to timely satisfy the needs of the customer.

Detailed organization structure of production department:-


All activities which are carried out in Production Department are as follows:-


(HOD)SPG

Sr. manager/dy. manager

production

Asst. manager/engineer

shift enginer

sr. technician/ technical

worker

packing

sr. officer

sr. clerk

worker

Sampling for Production

Sampling for Production Department

Market(Customer)

Marketing Department

Approval to market via Marketing Department

Production Starts

Dispatch to Marketing Department

Dispatch to Customer

Production (Producer)


First of all marketing people collect information from market (customer) which was used for

production & also send design to producer for production of goods .All activities like first marketing department collect order from customer and also own created designs directly send to production department. Production department also ask for certain design to marketing people. In short first marketing people send design as per design received in production unit and after the confirmation received from marketing department production start.

After production start then all the products dispatch to marketing department. Marketing department send all the goods to their customer. And also some product sends as for sample. So that customer knows about the product and sends order for that order.

Visit to the Manufacturing Unit and Engineering Unit:-

Factors should be considered while selecting the Plants is:-

Availability of Raw-Material. Nearness to Market. Availability of Power. Transport Facility. Suitability of Climate. Government Policy. Availability of Labour.

Factor influencing layout:-

Material. Product. Workers. Machinery. Types of Machinery. Location.


Factory/plant

Village Jolwa Taluka Palsana Surat District - 394305 Gujarat - India Phone : 271287-271289

Plant Layout

“Plant layout is physical arrangement of various buildings, production department, technical utilities and location of various machines with in each production department. The process of preparing plant-layout for new manufacturing or service setup is called layout design.”

In company decision one of the most important decisions is the decision related to Plant Layout of the company. When the company starts its new production unit at new site they must have to consider about the various factors. Those factors are known as the factor affecting plant layout decision.

For the company selection of best plant location is the very important decision, because it affects the cost of production and also the profitability of the company. In GARDEN SILK MILLS they also have 2 production unit i.e. Vareli plant and Jolwa plant. For the selection of this 2 plant they have consider certain factors which are as follows:-

1. Land cost.

2. Transportations.

3. Government regulations.

4. Availability of manpower.

There are many types of plant layout but Company follows the process layout, which shows below:-

A. Process layout.B. Product layout.C. Cellular Manufacturing Layout.D. Fixed Position Layout.


A. Process layout

Definition:-

Plant layout in which machines and equipment integral to a workflow are grouped together by function.(CONTINUOUS POLYMERISATION PLANT).

B. Product Layout:-

Definition:-

The organization of a factory or office so that the position of the workstations is optimized to suit the Product. Product layout ensures that products follow an assembly line where the different operations are undertaken in a logical sequence.

C Cellular Manufacturing Layout:- NAVNIRMAN INSTITUTE OF MANAGEMENT

PRODUCTION

DEPARTMENT

PARKING FOR TWO & FOUR VEHICAL

QUALITY DEPARTMENT

SPACE FOR THE TRANSPORATION ADMINISTRATION DEPARTMENS

INVENTORIES

OF SEMI, RAW MATERIALS

SHoP

FINISHED GOODS

WAREHOUSE CANTEEN

http://www.businessdictionary.com/definition/function.html

http://www.businessdictionary.com/definition/workflow.html

http://www.businessdictionary.com/definition/equipment.html

http://www.businessdictionary.com/definition/machine.html

http://www.businessdictionary.com/definition/layout.html

http://www.businessdictionary.com/definition/plant.html

Definition:-

In cellular manufacturing machines are grouped into cells and the cells function somewhat like a product layout within a larger shop or process layout.

D. Fixed Position Layout :-Definition:-

In this type of layout the material or major product remains constant and the machines and men move to that location.

Process of Manufacturing:-

Different techniques, such as weaving, printing, dying, shrouding, packing etc. are used in the production process. Yarn is chief raw material of the company. It is not manufactured at the plant of Vareli but is manufactured for looms at Jolwa.

Process of production can be described as below:-

Obtaining the raw material. Storing raw material. Twisting the yarn. Texturizing or crimping the yarn. Draw Warping. Sizing. Weaving. Dying and printing.


Chips

Textiles Film Bottle

Ethanol Gas

PAT Ethanol glycol

How POY Chips Are Made?


Mineral oil

Refinery

Xylol liquid

DMT

From Mineral Oil to PET Bottles:-


Manufacturing Of PET (Batch Process)


Melt spinning (pet)


Manufacturing System:-

The company used production factor as input like man, machine, capital etc. and get out put of cloths. Workers work in three shifts i.e. each shifts timing are 8 hours and during these 30 minutes break given to their employees.

Types of Products and their Specification:-

Types of product:-

Sarees Dress-Materials SKD (Skirt, Kurt and Dupptta) Suiting & Shirting etc.

Types of Raw-Material Used:-

Raw materials for yarn are as follows:-

DMT+MEDENOL (chemical)

Raw materials for gray cloths are as follows:-

Yarn:-Raw material for Sarees and dress material are as follows:-

Gray cloths:-Raw material for production of Sarees and dress materials are produce in company itself at Jolwa Plant and remaining part of raw-material can be purchase from outside.

Company’s policy for procurement of raw-material is three ways like:-

i. Own processing,

ii. Outside processing (OP) and

iii. Totally Out Side processing (OSP)

Percentages of procurement of Raw-material are as follows:-

OWN 80%

OP 10%

OSP 10%


Material handling equipment

Meaning of material handling:-

“It may be defined as the equipment which controls internal movement of material, from receipt, through storage and production and up to the shipment of finished product.”

Material handling equipments are very useful in the big company. This equipment are widely use in company.

In GARDEN they also use this type of equipments, which are helpful to them in the safe movement of their material.

Some equipment are as follows:-

Pipelines. Trolleys. Fork Lifts. Pallets. Hydraulic Machines. Plastic Bags. Boxes.

1) Pipelines :-

Pipelines are the very important part in the manufacturing company. It is very useful for the flow of the water, gas, air, chemical, and raw-material.

In GARDEN they also use the pipelines fro such kind of use. They mainly use pipelines for the flow of R.M. in the production process. They also use pipelines for the flow of air and liquid material.


2) Trolleys :-

Trolleys are mainly use for the transfer of goods from one place to another place. We also use trolley at our home use. In this way it is also used at the company.

In GARDEN they also use such kind of trolley. This trolley is use for the transfer of POY bobbin from one place to another.

The trolley capacity is 24-36 rolls. In GARDEN they have approximately 900 to 1000 trolleys.

As shown in the image the POY bobbins are kept in the stand which is fitted on the trolley.

3) Fork Lifts :-


Fork Lifts is very useful and very capable equipment. This is using for the carry the very big or the jumbo boxes. These boxes are very big and heavy, so that it can’t be handling manually. So that’s why the forklifts are being used.

This lifts can carry the boxes up to the height of 2 meters. This is use to load the boxes in to the truck. This lifts use diesel as fuel. We can see in the both image that, in the 1st image its shows the lifts and in the 2nd image it shows how this forklifts work.

4.) Pallets:-

Pallets are also very useful equipments. This is useful for to carry the jumbo box on it. As we know that jumbo box can’t be handling manually, so these pallets are use. Pallets are made of plastic & Wood. We can see in the diagram the pallets. In the 2nd image we can see different size of pallets and in the 1st

image we can see how the boxes are kept on pallets. These pallets these pallets are handled with the help of the Forklifts. The supplies of box are done on pallets. Once the buyer gets his order he gives back these pallets to the company. In GARDEN they use the pallets made of wood.


5. Hydraulic Machines:-

This machines capacity is about 2000-3000 kgs. This equipment is used to carry the jumbo boxes. The jumbo boxes can’t be carried manually, so because of that this kind of equipment is being used. It helps to make the dispatch of finished goods faster.

There are also some other things that can be used for material handling. These we can’t say the equipment but it helps a lot to save the goods. These are as follows.—

Plastic Bags. Boxes. (Small and Jumbo).


PROCESS OF MANUFACTURING

Different techniques, such as weaving, printing, dying, shrouding, packing etc. are used in the production process. Yarn is chief raw material of the company. It is not manufactured at the plant of Vareli but is manufactured for looms at Jolwa.

Process of production can be described as below:-

Obtaining The Raw Material Storing Raw Material Twisting The Yarn Texturizing Or Crimping The Yarn Draw Warping Sizing Weaving Dying And Printing

Obtaining the raw material :-

The raw material consumed by the company is Partially Oriented Yarn (POY). The yarn is procured from both internal and external sources.

Internal sources:-

Internal sources of the company comprise the manufacturing plant of Jolva and material purchase from “Surat Textile Mills” (STM), which is under the Garden Group of Company. Vareli plant also acquires raw material from Surat Textile Mills.

External sources:-

In the peak season, if the internal sources are unable to meet the demand, the company also procures material from external sources like Modern, Indo-Rama, and Reliance etc.

Storing the raw material :-

All the raw material needed by the various departments is purchased together and maintained in the storage area called “Dump Store” from where any department can access the required amount of raw material.

Twisting the yarn :-

Parcel oriented yarn is either twisted, according to the requirements of material consumed in production.


Process of twisting:-

a. Winding on bobbins: firstly POY is wound on bobbins, which are twisted on the twisting machine. The winding of yarn is done on the winding machine.

b. Twisting machine: the POY wound on the bobbins is then titled on the twisting machine. On which the yarn is twisted. In this process, first the yarn is passed through spindles on which the yarn is twisted in both the opposite directions One for one twisting machine: in this machine, the yarn is twisted once for revolution. Two for one twisting machine: in this machine, there are two twisters per one revolution. Now

days, TFOs are more widely used as they are quicker and offer a better quality. Fancy Twister: the yarn before twisting is not very strong and breaks easily. It is twisted in order

to increase its strength. Due to twisting, quality improves and hence production also increases.

Texturizing or crimping the yarn :- The POY is accessed from the dump store to the crimping or Texturizing section to Texturizing it. Denier is unit for measurement of POY. Those 9000 units of yarn are hanker and weighted in Grams, are called one denier. It is decreased after crimping.

Process of Crimping:-

Firstly, POY is put on machine in a specific amount. The place is called CRILL where it is put. After the first delivery, the yarn is heated. Then it is passed through cooling plate. After that, the yarn is passed through spindle assembly. Thereafter, it is passed through boiler and at all it is taken up. This is what the crimping to Texturizing process is. There are two ways for punching the yarn.

Raito-punched or bound. Crime-not punched.

Types of crimping machine:-

Friction type Magnetic type

DRAW WARPING :-

The POY is put directly on the Machine from the dump stove to draw warped process.

It’s the fully automatic system from the warping system. The process of drawing heat setting and intermingling is carried out. It is given tension and then wound on beam.


SIZING :-

Sizing is a process of saving of yarn. The raw material for sizing is accessed either from dump store, warp raw section or from Texturizing department. A beam is made at the beginning in the process on this department. Warp yarn i.e. Vertical threads are made.

A. Warping.

B. Chemical processes.

C. Waxing.

D. Beaming.

Weaving :-

After making the process of twisting camping, sizing or drawing warp, the yarn is rent to the weaving department. In grey cloth is manufactured through the process of weaving in this process one thread is horizontal and other is vertical. Horizontal thread is called Weft and the vertical thread is called Warp.

There are various types of looms on which the cloth is woven:-

1. Semi-Automatic Looms.

2. Water Jet Looms

3. Fully Automatic Looms.

It is notable that the production of grey cloth is 70000 meters/day and it increases every year.

Dyeing And Printing :-

This is the lent step of the process of production department in the company.

Process:-

The jet dyeing process is widely used for dying the grey cloth. It is dyed printed according to the requirement of design and colors.

A. First of all the grey cloth is washed and dyed, whichever color is necessitated. The Company dyes 9000mts of cloth daily.

B. The second step involves putting the dyed cloth in the drum washer to give crepe and georgette crease effect along with washing the stains.

The super wash machine is used for finishing and washing white color material.

Salvage or border outing machine is used for border cutting of the cloth.


Production planning:-

As we have seen, the sales manager forecast the demand and then he give it to production manager. After that production manager will estimate in what quantity RM will needed.

If we take example that the demand for POY is 40000 Metric Tonnes. And we know that we have to use the POY chips and spin-finished oil as a raw-material for it. And to make the forecasted demand we need the 70% to 80% of the POY chips and the rest will satisfy with spin-finished oil. So, in this case we will require 28000 to 32000 Metric Tons of POY chips and the rest will be complete by spin-finished oil.

Here, we are talking about the POY chips which are useful to make POY. But to make POY chips we also need raw-material like DMT & EG. The company itself produce the POY chips by using DMT & EG. So, they have to decide the quantity to purchase DMT & EG. Hey purchase DMT & EG from the outside as per the requirement. GARDEN JOLWA has capacity of 8000 MT/Month to produce POY.

a. Production planning based on MRP, CRP and MPS system.

MRP (Material Requirement Planning):-

It is a technique of determining the quantity and timing for the actualization of dependent demand item needed to satisfy the production schedule set by MPS.


Aggregate Plan

Inventory Status

MPS BOM File

Material Requirement Plan

Production Activity Control

Is Material Adequate?

YesNo

Material Requirement Planning

Flow Chart

Input Processing Output

MPS (Maintenance planning system):-

Maintenance is very important and necessary. In some company they use corrective maintenance or in

some company they do regular maintenance. In GARDEN (JOLWA) they use the regular maintenance

system. They do maintenance at every week. The maintenance officer checks all the parts of the

machinery at every week. And in between it any problems occurs they suddenly try to solve it.


MPS

Inventory Status File

BOM file

MRP

Expectation Reports

Planned Order Schedule

MPS Planner

Inventory Transaction

A. Scheduling strategies of Production Process Of POY

The production process of POY is easily understood from the diagram. The process is divided in the 6 stages.

STAGE:-1

The process starts at this stage. Here at the Silo storage is the point where all the POY chips are kept. The Silo storage we can see in the diagram. In this container all the chips are stored. And as the production starts the chips go from the Silo storage to in to Daily Silo storage.

STAGE:-2

This is the stage where the daily supplies of chips are being kept. Here the continuous storage is done. We can see this Daily Silo in the diagram. In this storage box there is some sensor level. This sensor helps in to fill the storage. As some level of chips decrease the supply from Silo storage to Daily Silo is started. This all activities are done fully automatically.

STAGE:-3

The third stage is the Dryer. That we can see in the diagram. From Daily Silo the chips come in to Dryer. In the Dryer the chips are melted at the temperature of 145’c. The main intension of this is to remove the moisture from the chips. So, the chips are melted over here and the moisture is removed at maximum level. In this dryer the hot air continuously go inside by the pump.

STAGE:-4

Once all the chips are come in to the liquid form it goes in to the extractor. That we can see in the diagram. In this stage the moisture from the liquid is extracted. Then the liquid turn in to clear form. Now, after this the liquid go in to the filter as shown in the diagram. Then the 5th stage started.

STAGE:-5

Now in this stage the liquid is divided in the different block. As we make the SAVE by using its machine, in this way this liquid is also passes from this type of machine. When it passes it is in a liquid form but as it is pass by some cool temperature it become threads.

STAGE:-6

Here it is the stage where the threads go in to the Winder. Winder is the place where the threads become strong. And after passing by winder it goes on bobbins or spoons. So, this way the POY is made from


the POY chips. Once all the spoons are fully covered with POY, it is take out with the help of Doffers trolley and carefully keep on trolley. So, this was the process of making POY from the POY chips.

To make this POY the whole production plan must be fully air-conditioned. Because any kind of dust can spoil the quality of POY.

There is also control room in the entire production house. This department control on the activity of machines. If there is any problem in machine they suddenly clear it.

Testing the Yarn:-

Parcel oriented yarn is either twisted, according to the requirements of material consumed in production.

Process of testing:-

Winding on bobbins: firstly POY is wound on bobbins, which are twisted on the twisting machine. The winding of yarn is done on the winding machine.

Twisting machine: the POY wound on the bobbins is then titled on the twisting machine. On which the yarn is twisted. In this process, first the yarn is passed through spindles on which the yarn is twisted in both the opposite directions.

One for one twisting machine: in this machine, the yarn is twisted once for revolution. Two for one twisting machine: in this machine, there are two twisters per one Fancy Twister: the yarn before twisting is not very strong and breaks easily. It is twisted in order

to increase its strength. Due to twisting, quality improves and hence production also increases.

Crimping or Texturizing of POY: - the POY is accessed from the dump store to the crimping or


texturizing section to texturizing it. Denier is unit for measurement of POY. Those 9000 units of yarn are hanker and weighted in Grams, are called one denier. It is decreased after crimping.

B. Various Priority Sequencing Rules :-

1) First Come First Serve (FCFS):- As its name suggests, incoming jobs or customers are processed in their order of arrival. FCFS is commonly applied in service industries such as banks, supermarkets, etc.

2) Earliest Due Date (EDD):- Top priority is assigned to the waiting job whose due date is earliest. EDD ignores when the jobs arrive and the time each of them takes to process.

3) Shortest Processing Time (SPT): -The job that can be completed in the shortest time at this work centre is processed next. The jobs due dates and order of arrival are immaterial.

4) Truncated shortest processing time (TSPT):- jobs that have waited longer than some predetermined designated truncation time are given highest priority and are processed next. If no jobs have waited that long, then the SPT rule applies.

5) Least Slack (LS):-Highest priority goes to the jobs whose slack time is least. Slack is calculated as the differences of the time remaining until the job is due and the length of its operation time. The order of arrival is ignored. “Slack=Available Time – Processing Time”

6) Longest Processing Time (LPS):- The job with the longest processing time is scheduled as the first job to be loaded on the machine among the jobs waiting in queue.

7) Preferred Customer Order (PCO):- Jobs belonging to a preferred customer are given a higher prioty than other jobs.

8) Random Selection:- This rule is not used normally. It may be used when no other consideration is important.

9) COVERT (Cost Over Time):- This rule uses the ratio of expected delay.

2. Johnson’s rule for 2 and 3 machines:-

S.M.JOHNSON presented a sequencing rule for a situation where there were n jobs to be processed through two machines/work centres. All the jobs followed the same sequence of the machines and hence we may call machine m1 and m2.the rule resulted in minimum total completion time for n jobs. by minimizing the total idle time of the machines that could be any number.


Extension of Johnson’s rule:-

To convert 3 mc problems into 2 mc problem and apply Johnson’s rule to get optimal sequence certain conditions have to be met, they are

Smallest duration on mc1 is at least as great as the largest duration on mc2 i.e. mc1.

Smallest duration onmc3 is at least as great as the largest duration on mc3 i.e. mc 3.

Inventory control

Inventory Control System:-

This is very important system, because it helps to control the misuse of R.M. The purchase manager daily takes the report of raw-material. He daily checks the opening balance and closing balance of various R.M At the end of the every day the report is send to the purchase manager by the store manager.

The format of this kind of report is as follow:-

a. Objectives of Inventory Management

A fundamental objective of a good system of inventory control is to be able to place an order at the right time from the right source to acquire the right quantity at right price and of right quality. James Lundy has suggested following objectives of inventory control:

(1) To Ensure Adequate Stock: An endeavour is made by inventory control to see that any department will get the raw materials or other necessary item as and when required. Hence an effective system of purchasing, storage and maintenance is effectively arranged so that enough stock is available on hand.

(2) To Minimize Inventories on Hand: The next objective of inventory control is to minimize inventories on hand. It has to be ensured that excessive stock is not kept and unnecessary capital is not locked up. But it must be consistent with adequate stock, so that production is not disrupted.

(3) To Maintain Continuity in Production: The supplies of materials spare parts, consumable stores etc. must be stocked to the optimum level, so that continuity of operations is maintained. The inventory control system should ensure that production is completed as per schedule.


http://www.listedall.com/2009/12/objectives-of-inventory-management.html

(4) Minimize the Cost of Purchasing and Storage: It is essential that there is economy in cost of purchasing, cost of receiving and inspection, storage and issue of materials etc. The expenses to be reduced to minimum are interest oh capital locked, insurance, maintenance, and inspection and transportation costs.

(5) To Minimize the Wastage and Loss: In every manufacturing organization, there is a risk of wastage and theft of stores, wastage and losses are likely to occur during movements and during the production processes. Inventory control ensures that the risk of theft, wastage and losses are minimized.

(6) To Reduce the Risk of Deterioration: If a considerable time elapses in the storage of goods, there arise two types of risks (i) the deterioration of goods stored and (ii) the goods becoming obsolete and out dated. Hence, inventory control ensures that such risk is minimized.

(7) Effective Use of Available Capital: Various levels like maximum level, minimum level, reordering level etc. are fixed in a system of inventory control, which ensures that unnecessary capital is not locked up in inventory. Order is placed at right time and in right quantity, taking into account the re-ordering level. This will make efficient purchasing possible.

(8) To be Helpful in Efficient Purchasing: Maintenance of optimum stock is closely connected with a system of inventory control. One of the major objectives of inventory control is to assist in efficient purchasing.

(9) To Give Maximum Satisfaction to Customers: The customer satisfaction is a sign of a progressive enterprise. Inventory control assists in supplying goods at proper price and at right time. Inventory control leads to economical purchase, makes possible continuity of production and maintaining enough stock. All these leads to consumer satisfaction.

(10) To Minimize Loss Due to Price Decline: When considerable investment is made in inventory, the price decrease on a large scale may involve the firm in considerable loss. This is reduced to a great extent by proper inventory control.

(11) Maximum Use of Storage Capacity: One of the objectives of inventory control is to make maximum use of storage capacity available. This will reduce storage costs.


(12) Proper Storage of Materials: Inventory control function includes supervision and control of storage of materials, tools etc. Where thousands of items are stored, it is necessary that material of a particular type required is immediately available. Efficient storage is made possible due to inventory control.

B) CALCULATION OF EOQ

EOQ:-

Economic order quantity (EOQ) is that size of the order which gives maximum economy in purchasing any material and ultimately contributes towards maintaining the materials at the optimum level and at the minimum cost.

Formula of Economic Order Quantity (EOQ):-

The different formulas have been developed for the calculation of economic order quantity (EOQ). The following formula is usually used for the calculation of EOQ.

2*CO*D’ CI

D = Demand for the year

Co = Cost to place a single order

Ci = Cost to hold one unit inventory for a year

* = ×

Example:-

Pam runs a mail-order business for gym equipment. Annual demand for the TricoFlexers is 16,000. The annual holding cost per unit is $2.50 and the cost to place an order is $50.


Calculate economic order quantity (EOQ)

Calculation:-

Underlying Assumptions of Economic Order Quantity:-

The ordering cost is constant. The rate of demand is constant. The lead time is fixed. The purchase price of the item is constant i.e no discount is available. The replenishment is made instantaneously; the whole batch is delivered at once.

Classification of Inventories According To ABC Analysis, VED Analysis and SFN Analysis

ABC analysis:-

ABC analysis is known as the “Always Better Control” method. This method is useful to differentiate between various inventories of the company. This method is useful for the inventory control. This method divides the product in to three parts according to its consumption value.

Concept of ABC Analysis:-

In ABC Analysis inventories are divided in to three classes. The classes are like A, B and C. It looks like as follows:-


CLASSES CONSUMPTION VALUE.

A 70% TO 80%

B 20% TO 10%

C 10%

Example of the ABC Analysis from GARDEN Company:-

ABC Analysis of the company’s some RM on the basis of its consumption value is given below. The ABC Analysis is look like as follows:-

ITEM QTY TOTAL (In Rs. Lakhs)

% OF CV

CUMULATIVE CLASS

PTA 74383 MT

31105 54.58% 54.58%

AMEG 33331

MT13616 23.89% 78.47%

DMT 16060 MT

6413 11.25% 89.72%

BSPIN OIL 00653

MT3456 6.06% 95.78%

SPARE 10000 PC

2000 3.51% 99.29%

CCHEMICAL 00555

MT396 0.69% 00.71%

VED Analysis:- NAVNIRMAN INSTITUTE OF MANAGEMENT

VED Analysis was found to overcome the limitations of ABC Analysis. It include three category of inventories, which are as follows:-

Vital Item. Essential Item. Desirable Item.

1. Vital items:-

These are which are necessary for the continuous production. Without which the production will not continue. If we say about GARDEN Company there are inventories like PTA, DMT, MEG are Raw Material which are necessary for continuous production.

2. Essential items:-

This are the item without which the production will not stop but it will run slowly. Means if the company have not that RM presently, then the production will not stop but it will run slowly.

For GARDEN this kind of Raw Material are Spin fin oil and Chemical. Etc…

3. Desirable items:-

This are the item without which the production will not stop or slow down but it will run with inconvenience way.

For GARDEN Company this kind of item are machinery Spare Parts, Measuring Equipment and some Safety Devices.

Quality control

Quality Policy of Garden’s Jolwa Plant. The Company follows the following slogan to show their quality preference.

“Quality is true basis of viability”

Quality Control System


In GARDEN (JOLWA) there is a separate quality control department this department is besides of the

production department. They check the quality of the R.M and Finished goods both. Their quality policy

is to satisfy the customer at maximum level. The company has appointed many engineers who always

take care about quality.

a. Objectives of quality control:-

To satisfy customer need and expectation.

Striving for continuous improvements through implementation of ISO 9001:2000.

Establishing, Communicating and reviewing measurable quality objections.

Developing and improving employee skills through effective training.

Maintaining safe working practices.

b. Techniques used for quality control:-

Quality Control For Raw Material & Finished Goods.To make the POY the major R.M is POY

chips and spin-finished oil. In GARDEN they always check the quality of this both. If they found

any bad quality then they will keep it aside. They also safely load the material in to the machine.

Once the POY made they also check the quality of it. They check the quality of the entire POY

bobbin. They take the sample from the each and every bobbin and then they make the sample cloth

from it. Then they dyed and print that cloth. And if there is any mistake then they tell to production

manager to solve it. If the quality is good then they put the symbol of OK tested and then they pack

that material. They also check the denier and also the filament of the POY. The checking of denier

is done with the help of the machine called “Rap Reel Machine”. And the checking of filament is

done by computerized system.

c. Guideline Quality Control for Work-In-Progress:-

In GARDEN they have also the system of checking the quality of goods when it is in progress. The

exports keep on their eye on the every activity of the machine. They check the every activity of


machine. They have the computerized system in which they can easily know in which machine the

problem is occurs. And then they solve it.

Certificates of Quality Control Are as Following:-


Cost control


a. Technology used for cost control

There are so many types of technology used in the textile industry. Over company use latest

technology for the different production process, which is, represents below:-

1. For the Polyester Chips :-

Continuous Polymerization plant of Chemtex –DuPont, USA technology is used to manufacture

high quality chips. Batch Poly plant for specialty chips such as Cationic and Full Dull.

2. For the Partially Oriented Yarn :-

The Company has the best assembly of technology like:-

Noy Val Lesina mainly for specialty such as Cationic, Full Dull POY TMT, Japan and Barmag -

Saurer, Germany for Semi Dull, Bright and Full Bright POY.

Best Winders such as from Barmag to build better packages.

A leading supplier of differentiated polyester yarns such as bright, cationic, micro denier and fine

denier yarns.

3. For the Draw Textures Yarn :-

The company is known for quality Dtex Yarn, manufactured on 37 machines from Himson

(Reiter) and Alidhara.

For export quality dedicated machines with Electronic Online Doff Monitoring system is used to

build Equal Length packages.

Latest Heberlein Slide Jet FT15-2 P142-2 series are used for high quality Intermingled Yarn.


4. For the Fully Drawn and Flat Yarn :-

The company is the largest manufacturer of Flat yarn with 14 Ishikawa, 12 Zinser, 12 Teijin Seiki

Draw Twisting machines and 11 Teijin Seiki Draw Winders.

FDY is produced on TMT Machinery Inc, Japan technology with triple Godet plus one cold Godet

for better quality of Nips at lower winding tensions.

We are the leading & largest manufacturer in India of Fully Drawn Flat Filament Yarn, the fastest

growing PFY category.

The largest supplier of Flat Yarn to the sizing sector in India.

A leading supplier of differentiated polyester yarns such as bright, cationic, micro denier and fine

denier yarns.

5. For the Draw Warp and Sized Yarn:-

Best Liba Barmag and Karl Mayer machines to manufacture Draw Warp Yarns.

6 For the Fabric :-

One of the largest installation bases of Tsudakoma and Nissan Water Jet Looms.

India’s only man‐made filament weaving unit with an ISO 9001 certification.

We are the largest seller of branded polyester sarees & dress materials in the country under the

brands “Garden” & “Vareli”.


Under the Guidance:- Mr. Avinash pawar (General Manager)

Mr. Rakesh Nayak (Senior Clerk).

INTRODUCTION


Human resource management may be defined as a set of policies, practices and programmes designed to maximize both personal and organizational goals. It is the process of binding people and organizations together so that the objectives of each are achieved.

According to Flippo, personnel management or Human resource management is “the planning, organizing, directing, and controlling of the procurement, development, compensation, integration, maintenance and reproduction of Human resource to the end that individual, organizational, and societal objectives are accomplished.”

In any organization, human resource management is very useful to improve and maintain relation between management and employee, trade union and management. It works as a watch dog on each and every activity of employees, management, labour union, etc.

Garden silk mill ltd. has a very well developed human resource management. Mr. Sanjay agrawal is very helpful person. So he has very good knowledge in the field of human resource. His assistants also very well related with HRD. Mr. Agrawal believes that any organization get success if there is proper co-ordination between its employees and management.

In this topic we discuss about how human resource department doing its activity to develop good relation between employee and management to get success.

Study of organization structure to decide what type of organization structure is designed for company?

In a simple term, structure is the pattern in which various parts or components are interrelated or interconnected. Thus, organization structure is the pattern of relationships among various components or parts of the organization. This prescribes the relationships among various activities and positions. Since these positions are held by various persons, the structure is the relationships among people in the organization.

Garden silk mill ltd. has line and staff type of organization structure. Because there is good relationship between superior and subordinate.

Line position. Production department. Selling department.

These departments come under staff position because they get advice from finance department and human resource department in the matters like, purchasing, recruitment, selection, etc.

Study of Bases for Departmentation


The first real task in designing an organization structure is the identification of activities and to group them properly. The process of grouping the activities is commonly known as departmentation. The terms used to denote departments that results from departmentation vary a great deal. In business organization, such terms as division, department, and section are used.

Function wise

The grouping of common or homogeneous activity to from an organization unit is known as functional departmentation, that is, the units are organized around common functions.

In Garden silk mill ltd., there are four main or basic functions like production, finance, marketing and human resource management.

Geographical Departmentation

Garden silk mill ltd. is doing export and import of rough and polished diamond, so we can classify its activity as following departmentation.

OGANIZATION STRUCTURE OF HR DEPARTMENT

Vision & Mission of the Garden Silk Mills


Director

M.D.

G.M

Assist. Manager

Staff

Vision of the Garden Silk Mills:-

Vision is to manufacture product as par international standards and compete international textile industries.

Mission of the Garden Silk Mills:-

Customer satisfaction is there ultimate mission.

ACTIVITY OF HUMAN RESOURCE DEPARTMENT

Organization planning. Human Resource Planning. Job Analysis. Job Description. Job Specification. Acquisition of human resource. Managing performance. Motivational activities. Training and Development. Compensation and Benefits. Health and safety provision. Organization Development. Encouraging participation in management. Grievance procedure etc..

HUMAN RESOURCE PLANNING

“HRP is the process of forecasting an organizations future demand for, and supply of, the right type of people in the right number.”

HRP facilitates the realization of the company’s objectives by providing the right number of personnel’s.

HRP – Process


Forecasting refers to the estimates of the future demand of the employee. This can be done by some analysis. And to do analysis it considers some factors. There are mainly two factors which are as follows:-

External factors. Internal factors.


HRP - Process

Internal

Oraganizational Decisions

Workforce Factors

Forcasting Techniques

External

Political,Legal,Social Changes

Competition

1. EXTERNAL FACTORS:-

A). POLITICAL, LEGAL, SOCIAL AND THE TECHNICAL CHANGES.

The demand for certain categories of employees and skills is also influenced by changes in political, legal and social structure of an economy. In the Garden Company, it has appointed the technicians and engineers during the last couple of years by taking into consideration the latest technology in construction, software etc. the company considers technology as a doubled-edged weapon. So, as a when the technology changes, the company will also recruit new technicians & engineers to cope with the technology.

B). COMPETITION.

Garden company is operating in a field where a large number of players are bent while cutting each other’s throat. In order to stay in a competitive market, the company has to ‘LEAN’ by reducing their workforce. The company is planning better workforce as competition has so much increased in the market. On the other hand, the company is doing well and also progressing smoothly so it will always look for people with critical skills.

2. INTERNAL FACTORS:-

A). ORGANIZATIONAL DECISIONS.

In planning H.R., the company undertakes the strategic plan; it takes into consideration the sales and the production forecasts. The company is expecting higher demand of textured yarn and for this, the company has planned long-term plan. Moreover, the company is in search of people possessing requisite skills in next couple of years.

B). WORKFORCE FACTORS.

The demand for new job occurs because of retrenchments transactions, resignations, deaths and leaves or absence. The Garden behaves that due to past experience the rate of occurrence of all these actions by employees are partly predictable.


C). FORECASTING TECHNIQUES.

The manpower forecasting techniques employed by the Garden Company are described below

a) Expert’s forecasting:-In the Garden Company, managers estimate future human resource requirements. Sometimes, the company also appoints the experts to forecast human resources along with the manager’s experience and judgments which gives the good effect.

b) Trend Analysis :-

The Garden company is deciding or forecasting its H.R. needs through projecting past trends. Past rates of change can be projected into the future or employment growth can be estimated by its relationship with a particular index.

RECRUITMENT AND SELECTION PROCESS

RECRUITMENT: -

DEFINITION OF RECRUITMENT: -

“It is process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and end when their applicants are admitted.

The result is pool of applications from which new employee are selected”

Recruitment is an important part of an organization’s human resource planning and their competitive strength. Competent human resources at the right positions in the organization are a vital resource and can be a core competency or a strategic advantage for it.

The objective of the recruitment process is to obtain the number and quality of employees that can be selected in order to help the organization to achieve its goals and objectives. With the same objective, recruitment helps to create a pool of prospective employees for the organization so that the management can select the right candidate for the right job from this pool. Recruitment acts as a link between the employers and the job seekers and ensures the placement of right candidate at the right place at the right time. Using and following the right recruitment processes can facilitate the selection of the best candidates for the organization.

In this is competitive global world and increasing flexibility in the Labour market, recruitment is becoming more and more important in every business. Therefore, recruitment serves as the first step in fulfilling the needs of organizations for a competitive, motivated and flexible human resource that can help achieve its objectives

After deciding number and type of people required for organization need through HRP and job analysis and job design specified the task and duty of jobs and qualification expected from prospective job holders. After that as per recruitment can be done but before that following factor can be under taken.


1. INTERNAL FACTORS : -

Requirement policy. HRP strategic. Size of the organization and number of employees. Cost involve in recruiting employee. Growth and expansion plan of the organization.

2. EXTERNAL FACTOR: -

Supply and demand of specific skills in the Labour market. Political and legal consideration such as reservation of jobs for SC’s, and so on. HRP and job analysis determine requirement and selection needs.


Recruitment Process:-


Recruitment Planning* Contact*Type of Contact

Strategy Devlopment

*Internal* External

Searching* Source Activation

* Selling

Screening

Evaluation & Control

RECRUITMENT PROCESS

Recruitment Planning: -

Number of contact. Type of contact.

Strategy Devolvement: -

Make or buy. Make (hire less skilled worker). Buy (hire skilled labours and professional). Technological sophistication or method used to reduce in recruitment. Where to look or reduce costs. How to look or source of recruitment.

INTERNAL RECRUITMENT: -

Present employee’s promotion. Employee referrals or employee families and friends. Former employees or some retired employees. Previous applicants.


EXTERNAL RECRUITMENT: -

Professional or tread association. Advertisement in news paper. Employment expanse. Campus recruitment. Consultancy.

Searching : -

Source activation. Selling.

Screenings: -

Application received in response from advertisement is screened and only eligible applicants are called for an interview.

The reason is reduce that application that is visibly unqualified for the job and to save time and money.

Evaluation And Control: -

Evaluation and control is necessary as considerable costs are incurred in the recruitment process.

SELECTION

After completing recruitment, selection process can be start on the basis of recruitment application. First of all temporary job can be offer then after training given to employees during these induction program can be bone through this new employee introduce with company and other detail of company given to new employee then training given and then after probation basis job offer i.e. part of temporary job with some condition can be offered.

Definition:-

“It is the process of differentiate between company applicants in order to identify (and hire) those with a greater like hood of success in a job.”


Selection process:-

The company can follow this process of the selection. This process diagram can be following hear:

The company normally selects its employee through simple way but company use above process when it needs professional employees who have high qualification. Generally departmental head select the candidates who are suitable in their department but the time of the select professional candidates, the company invited selection committee to selection process. Hear following the steps of the company’s selection process:-


Selection decision

Reference and Background analysis

Job Offer

Evaluation

Physical Examination

REJECTED

APPLICANTS

Preliminary Interview

Selection Test

Employment Interview

Employment Contract

In short first of all recruitment can be done through internal and external sources and after out of them selection on the basis of some criteria can be done then finally to offer job to selected employee.

First of all temporary job can be offer then after training given to employees during these induction program can be done through this new employee introduce with company and other detail of company given to new employee then training given and then after probation basis job offer i.e. part of temporary job with some condition can be offered.

EDUCATIONAL CRITERIA FOR SELECTION

FOR MANAGER's & SUPERVISOR: -

Managers possessing textile or production degree are employed to respective jobs in beginning the salary is Rs.4500/-

FOR TEMPORARY STAFF: -

In the temporary Staff level science graduates or diploma in engineering filed are selected their salary is Rs.3500/- at the beginning.

For Labour: -

There is no need to any educational criteria for the Labour job in this job has experience and skill for the work their wages is given to them according to their daily wage system.

DOCUMENT RELATED WITH RECRUITMENT AND SELECTION

In GARDEN Company there are not so much document are kept of the recruitment and selection. In GARDEN they don’t do this process on big scale. So, there are not so many documents are kept.

But some document names are as follows:-

List of applicant according to different types of job. Ranking of applicants on the basis of their qualifications. List of the applicant who will be called for interview. List of the rejected applicant for the future use. List of the applicants who are selected for job.


Sources of Recruitment:-


Sources of Recruitment

Internal Methods-- Promorions & Trnsfers

Direct Methods-- Campus Recruitment

Indirect Methods

SOURCES OF RECRUITMENT:-

Recruitment is positive in nature because it attracts as many as possible applicants. The Garden Company is recruiting people by using three methods. They are as follows:-

A. Internal Methods.

B. Direct Methods.

C. Indirect Methods.

A. INTERNAL METHODS :-

Internal methods means to recruit the employee from with in the company, some internal methods are as follows:-

PROMOTIONS AND TRANSFERS. JOB POSTING.

PROMOTIONS AND TRANSFERS : -

This method is used to fill the vacancies from within the organizations through promotions and transfers. Sometimes, when vacancies arise the company recruits people from within the organization. It is done in 2 ways: Either by giving promotion or by giving transfer.

The company is following the promotion system rather than transfer. The company gives promotion to the employees from lower level to higher level. As per the industrial act, if a person remains on such rolls for 240 days or more, he will get a status of permanent employee, and he is also entitled to all relevant benefits, including provident fund, retrenchment and compensation.

JOB POSTING : -

This is the way used by Garden Company to hire people from within the organization. Under this, the company publishes job openings on bulletins, boards, electronic media and other similar outlets. The main aim of the company is to use this method because it offers a change to highly qualified applicants working within the company to look for growth opportunities within the company without looking for green pastures outside.


B. DIRECT METHODS:-

CAMPUS RECRUITMENT:-

The company is not much using this method of recruitment. Under this method, the managers of the company visit the college campus and their placement centers. This method is not used by the company because there are more disadvantages rather than the advantages. The main disadvantage is that campus recruitment can be costly for the company. The reason behind this is that the expenses of welfare boarding and lodging expense of recruits.

C. INDIRECT METHODS:

The indirect method consists of the advertisements in the newspapers, information written on the notice board of the required employee etc.

Garden Silk Mills Ltd. follows these two methods for recruitment:-

Internal Methods. Indirect Methods.

TRAINING AND DEVELOPMENT

Every individual who is selected for the job needs the training. Without getting training it is not easy for the individual to perform the job accurately and the precisely. He should be given at least the basic knowledge with the help of which he can carry out his work. Therefore, training is a must for each and every employee working in the organization. It helps the employees to get the basic facts of their jobs and the working environment under which they are supposed to perform their duties. Briefly , we can say that,

“Training is the process of increasing the knowledge and Organized procedure by which people get the knowledge and develop certain skills for a definite purpose.”

The purpose of training is basically to bridge the gap between job requirements and present competence of an employee. Training is aimed at improving the behaviour and performance of a person. It is a never ending process. Training is closely related to education and development but needs to be differentiated from these terms.


The Garden Company gives training to the employees who needs after their work have been examined. And also the training is given to those who are new in the organization. So the company gives training not to all but the few of its employees. The company gives the training for about 1 year. The employees are observed by the senior officers.

As per the rule of the government a person has to undergo training at the Indian Institute of Training. Here he is supposed to do training for 2 years and then with the company apprentice for 1 year.

INDUCTION TRAINING

Induction means “ to receive and welcome the new employee when he first join the company and also give some basic information of the company to the employee, so he starts his work soon and he also aware about the company’s environment as soon as possible”.

GARDEN too provides Induction. Some reasons for that are as follows:-

Workers become aware of company’s environment. The fear can be removed. Workers become aware about the company’s rules and regulations. He came to know about the location of various plant and machinery.

To receive induction it is very valuable for workers.

NEED OF TRAINING

To improve knowledge & skill. To develop attitude & behaviour. Reduced cost, accident and mistake. Increase efficiency. To increase productivity. Imparting information on new technology and methodology. To maintain industrial relation.


INFRASTRUCTURE FOR TRAINING DEPARTMENT

The following tools & materials are imparted for, facility required for imparting training:-

Training room/Seminar room. Board, Chair, OHP (Over Head Project). Television, VCR, CD player. Automatic slide projector. Computer with multimedia facility. Video projector demonstration for technical guidance.

PROMOTION, DEMOTION AND INCREMENT POLICIES

“Promotion means an improvement in pay, prestige, position & responsibility of an employee within his or her organization.”

In promotion the salary of the workers is raised according to his efficiency. In Garden Silk, the promotion is given on seniority basis. Some of the factors which influence the promotion are his past records, person’s behaviour, his interview report, job knowledge etc. Garden follows the seniority basis for promotion because the seniors are usually more experienced and young people may gain more knowledge, expertise, skills etc under senior’s guidance.

The purposes for promotion are mentioned below:-

To motivate employees to higher productivity. To attract and retain the services of qualified and competent people. To identify and reward the efficiency of the employees. To fill up higher vacancies from within the organization. To build loyalty, morale and a sense of belongingness in the employee.


TYPES OF PROMOTION : -

HORIZONTAL PROMOTION

It increases the responsibilities and pay with a change in designation but the person does not transgress job classification. For eg; head-clerk from clerk

VERTICAL PROMOTION

It results in greater responsibility, prestige, along with the increase in pay and a change in the nature of the job.

DRY PROMOTION

Dry promotion means sometimes increase in remuneration or better designation but the responsibilities is not changed. The promoted sometimes may be given increments annually or semi- annually.

DEMOTION

A demotion is a reduction in rank, often accompanied with a lower pay status. There are many situations in which a demotion might occur; any kind of ranked system like a police department or military, for example, uses demotions as a disciplinary tool, while some employees are at risk of demotion due to reorganization or substandard work. Most people view a demotion as a punishment, since it implies that the individual was incapable of performing at a higher rank, and the opposite of a demotion is a promotion, an elevation in rank or status.

Most commonly, a demotion occurs when someone fails to perform as expected. This failure may not be severe enough to be punished with employment termination, but it does require a rethinking of the employee's job responsibilities and functions. When someone is demoted, he or she may be demoted within a department or outside it, depending on company needs. Being demoted in a department can be awkward, as the employee's coworkers will be well aware of his or her fall from grace

INCREMENTS

In Garden increment is given on the basis of Performance Appraisal. Staff is given 4 Grades: A, B, C, D and on the basis of grades increments are given.

For eg; For Grade A maximum increment is given, B is given lesser than A, C is given lesser than A-B and D is given the least increment.


PERFORMANCE APPRAISAL

Performance appraisal can be defined as the process of systematic, periodic and impartial estimating the value excellence, qualities and thereby evaluating the performance of a person in terms of requirement of the job for which he is employed.

The management uses the performance appraisal results for promotion and transfer, identifying training and development needs. Management has established some performance standards upon which the appraisal is done.

In the Garden Company the appraisal is done after every 6 months by the head of the department and the results are conveyed to the respective workers.

PERFORMANCE APPRAISAL PROCESS FOLLOWED BY GARDEN SILK MILLS


Establishing Performance Standards

Communicating Standards & Expectation

Measuring the Actual Performance

Comparing with Standards

Discussing Results

Decision Making -- Taking Corrective Action

ESTABLISHING PERFORMANCE STANDARD:-

The first step in the process of performance appraisal is the setting up of the standards which will be used to as the base to compare the actual performance of the employees. This step requires setting the criteria to judge the performance of the employees as successful or unsuccessful and the degrees of their contribution to the organizational goals & objectives. The standards set should be clear, easily understandable and in measurable terms.

COMMUNICATING THE STANDARD:-

Once set, it is the responsibility of the management to communicate the standards to all the employees of the organization. The employees should be informed and the standards should be clearly explained to the. This will help them to understand their roles and to know what exactly is expected from them. The standards should also be communicated to the appraisers or the evaluators and if required, the standards can also be modified at this stage itself according to the relevant feedback from the employees.

MEASURING THE ACTUAL PERFORMANCE: -

The most difficult part of the Performance appraisal process is measuring the actual performance of the employees that is the work done by the employees during the specified period of time. It is a continuous process which involves monitoring the performance throughout the year. This stage requires the careful selection of the appropriate techniques of measurement, taking care that personal bias does not affect the outcome of the process and providing assistance rather than interfering in an employees work.

COMPARING THE ACTUAL WITH THE DESIRE PERFORMANCE:-

The actual performance is compared with the desired or the standard performance. The comparison tells the deviations in the performance of the employees from the standards set. The result can show the actual performance being more than the desired performance or, the actual performance being less than the desired performance depicting a negative deviation in the organizational performance. It includes recalling, evaluating and analysis of data related to the employees’ performance.


DISCUSSING RESULTS: -

The result of the appraisal is communicated and discussed with the employees on one-to-one basis. The focus of this discussion is on communication and listening. The results, the problems and the possible solutions are discussed with the aim of problem solving and reaching consensus. The feedback should be given with a positive attitude as this can have an effect on the employees’ future performance. The purpose of the meeting should be to solve the problems faced and motivate the employees to perform better.

DECISION MAKING: -

The last step of the process is to take decisions which can be taken either to improve the performance of the employees, take the required corrective actions, or the related HR decisions like rewards, promotions, demotions, transfers etc.

WAGE AND SALARY ADMINISTRATION

Wages represent the hourly rates of pay and salary refers to the monthly rate of pay, irrespective of the number of hours put in by an employee. Wages and salaries are subject to annual increment. The wages differ from employee to employee and it also depends on the nature of the job, seniority and merits. On the other hand we can define salary as the amount of money paid to an employee monthly or yearly. Currently 4500 employees are working at Garden Silk Mills Ltd.

The salary structure is as follows:-

Temporary Employee Rs2700 & other incentives

Probation Employee Rs3800 & other incentives

Permanent Employee Rs5250 & other incentives


The government decides the minimum wage payment and as per the law all the companies has to pay the above mentioned minimum wage to its employees.

THE PATTERN OF PAY SLIP:-

Name and code of the employee Provident Fund

Slip no. Employee State Insurance

Attendance Personal Tax

Leave LIC

Absent Income Tax

Pay days Cash Advances

Rate – basic & HRA Mobile Charges

Two copies of the pay slip are maintained. One is given to the employee and the other is kept by the company for its records. The attendance of the employees is taken every day. The company gives attendance card to each of its employees and makes a register in order to keep records of the employees. When the employee enters into the company he signs in the register and when he leaves again do the same procedure and so in this way, the records are maintained.

INCENTIVES & MOTIVATION SYSTEM

Incentives are payment plans which provide encouragement by extra payment over and above regular time rated remuneration for the extra performance. To get desired or targeted result, organization can provide extra remuneration for better performance of employees. In other words, an incentive scheme is a plan or programmers to motive individuals or group performance.

Garden Silk Mills Pvt. Ltd. and other company also use certain incentives to motivate its employees. Motivation means to force a person and involve him to complete the work in right time and place with help by providing a basic need or special need to worker. Especially Maslow’s need hierarchy used to motivate employees such as basic need, special need, safety need, recognize, identify, self realization.

Extra salary is one such type of incentive which is given to those employees who show sincerity and regularity throughout the year in their work. Salary is vital factor to motivate employees. Safety need is also used to complete the work. Other motivational factors are: Good Organizational Culture, Grievance Handling System, No Rigidness, Certificates, Promotion Letters etc. based on some fixed criteria.


Personality:-

There are certain qualities of good personality such as outlook, communication, nature, presentation, good behaviour, positive attitude.

Look:-

The person in a formal dress. In proper hair style, clean shoes. In case of mail, plain & light shirt and dark pent. Other factors that adds flavours to look.

Communication:-

Communication is a mature process; we find communication not only between human being but also between in animal. Communication means express words and ideas of the one person to other in a way that the person can understood clearly and easily. This can be done in three ways.

Verbal:-

Here selection of correct word is most essential factor because verbal communication means express ideas in word by speaking.

Written:-

Written communication means one can present his view form of written point and points clearly understood by other person. One can add sketch/pictures with text to support own view & create a clear picture of the idea.

Gesture:-

Gesture communication means one can express idea through body language. Body language should be perfect and well balanced.


To make communication be perfect – by whom, what, why, when, where & how added while receiving and giving any instruction. It should be maintained to make communication perfect and confusion less and misunderstanding less.

Nature:-

Nature of a person should a person should be balanced not too rigid or to flexible so as to tackle situation smoothly.

Good Behaviour:-

Behaviour of one person doesn’t put others in trouble or should hurt others by means of word or action.

Positive Attitude & Thinking:-

Positive attitude and thinking of a person will add up to personality.

LABOUR WELFARE ACTIVITIES

Canteen Facility

It is providing employees the facility of breakfast, lunch and dinner at the reasonable prices.

Rest Room

The rest room facility is given to the workers to take rest during the lunch time and even during the free time.

Uniforms

The workers are given the uniform which they are supposed to wear during the office hours.

Shoes And Raincoats

All the employees and the workers of the company are given the shoes and raincoats during the monsoon.

First Aid Facility

It is given for quick remedy of employees, when any accident occurs during the working hours of the organization.

Scholarship


Company provides the scholarship to the workers and the employees to those who study for the company as a trainee.

Transportation (Bus) Facility

The company also provides the bus facility for the workers from Vareli to bela mills and even from Jolwa to silk mills for to and fro of the workers.

Other Facilities:-

Transport facilities are available for SURAT addressee to all staff and workers and some contractor’s Labour

Gratuity is given for 15 days for each year worked if completed 05 years Med claim is provided to the staff with family approx between 25k to 85k and single staff is

provided med claim up to 15k. Probation is provided for 6 months to experience employees and 1 year to the others. Confirmation letter is issued upon the assessment on completion of probation period. The retirement age of the employees is 58 years. There are total 4 shifts and timing of which are as follows:-

Shift A – 07:00 am to 03:00 pm. Shift B – 03:00 pm to 11:00 pm. Shift C – 11:00 pm to 07:00 am. General Shift – 09:30 am to 06:30 pm. The timing for Saturday is 09:30 am to 03:00 pm.

The car policy is provided to the managers and other senior officers of the company on selective basis, the company provided 52% of the total policy and 48% is of self.

The increment is provided to the staff in April and to the workers in January.

Labour Relation Activities

Labour relations are concerned with the relationship between management and workers. In Garden Silk Mills Ltd., the Labour relations have been maintained very nicely. It is important for the company to maintain good relations with the Labour otherwise the company cannot come on the position where it is now.

Trade Union

Textile industries have two trade unions. SURAT silk mills Labour unions.


Bombay industrial relations act.

Generally the employee of the company is not interested in any of the above mentioned trade unions but if any disputes arises and the matter goes to the court than the employee takes the help of the SURAT silk mills Labour unions.


Under the Guidance:- Mr. Bipin Modi (Finance Manager).

INTRODUCTION

“Financial management is an area of financial decision making, harmonizing individual motives and enterprise goals”.

Money is the life-blood at modern business. Money is required to purchase expensive machinery, and day-to-day expenses on raw materials, labour, and operational and administrative needs at business, execution at expansion.

In the GARDEN Company, there are separate department of Accounting Department & Financial Department. The Company‘s financial position in the textile industry is very strong so that we said that the company’s finance department is very strong. Hear show “the structure of finance department”.


Whole time

Director

General Manager

(Finance)

Executive Manager

Company Secretary

Junior Executive

LegalMatters

Tax Consultant

A. WORKING CAPITAL MANAGEMENT

INTRODUCTION:-

Working capital is one of the most fundamental measures of company’s financial strength. If company possesses a significant value of liquid assets, it can easily fund its day-to-day business obligation. Working capital also provides insight on how efficiently a company’s management able to oversee the company operation. The speed at which the company is able to manage its short term assets and short term liabilities is also crucial to its business success. Keeping working capital level to the minimum required for efficient operation keeps cost down. This means controlling buying, handling, storing, and managing stock property.

In simple terms, working capital refers to the cash a company Requires in order to finance its Day-to-day business operation or in other words, working capital refers to the amount of capital which is readily available to an organization. The term working capital is more an accounting term a management concept. There are two concept of working capital for the purpose of definition – Gross Concept and Net Concept. Gross Concept refers to firm’s current assets. The firm’s total current assets are termed as gross working capital. Net Concept refers to current assets less current liabilities. That means, working capital is difference between resources in cash or readily convertible into cash (current assets) and organizational commitment for which cash will soon be required (current liabilities).

Working Capital = Current Assets – Current Liabilities.

TABLE OF WORKING CAPITAL

(Rs. IN CRORE)


a. CASH MANAGEMENT

Cash management refers to the practices and techniques designed to accelerate and control collections, ensure promote deposits of receipts, improve control over disbursement methods, and eliminate idle cash balances. The objective of cash management is to “keep the investment in cash as low as possible while still operating the firm’s activities efficiently and effectively”.

Reasons For Holding Cash:-

Cash is maintained for compensating balances. Compensating balances are the bank balances that a firm must maintain to compensate the bank for services rendered or for granting a loan. A minimum required compensating balance at bank providing credit service to the firm may impose a lower limit on the level of cash a firm holds.

Cash is desirable because it offers more liquidity then other interest bearing securities provide.

Suppliers frequently offer trade discounts for making payment early. Form a financing viewpoint, the cost of not taking these discounts is very high, so firms should always have enough cash on hand to take advantage of cash discounts.

An adequate supply of cash helps keep the firm’s current and quick ratios high enough to maintain a good credit rating.

CASH CONVERSION CYCLE

= Avg. receivable collection period + Inventory conversion period – Avg. payment period.


Particulars 2011-2010 20010-2009 2009-2008 Current assets

Inventories 641.09 365.36 217.55Sundry Debtors 159.54 126.87 67.47

Cash & Bank Balance 5.38 10.04 12.5Loan & Advances 209.81 223.02 204.37

Fixed deposits 15.75 24.77 60.37Total of A (Gross W.C.) 1031.57 750.06 562.27

Current liabilities 500.66 395.11 225.04Provisions 48.07 56.03 38.76Total of B 548.73 451.14 263.8

NET WC (A-b) 482.84 298.92 298.47

Avg. receivable collection period = Receivable x 360

Sales

Inventory Conversion Period = Inventory x 360

Cost of Goods Sold

Year Inventory Cost of Goods

Sold

Inventory Conversion

Period

2006-2007 130.03 1240.20 37.74

2007-2008 185.76 1504.34 44.45

2008-2009 217.55 1177.18 66.53

2009-2010 365.36 2272.21 56.46

2010-2011 641.09 3096.84 74.52

Avg. payment period = Account Payable x 360

Cost of Goods Sold


Year Receivable Sales Avg. Receivable Collection

Period

2006-2007 64.74 1393.80 16.72

2007-2008 107.90 1675.20 23.19

2008-2009 67.47 1332.27 18.23

2009-2010 126.87 2507.30 18.21

2010-2011 159.54 3395.49 16.91

Cash Conversion Cycle:-

b. RECEIVABLE MANAGEMENT

The accounts receivables are generated which are collected at a future date only when the firm

grants credit against an ordinary sale of goods or services without receiving cash. Credit sale is an

essential part of the present competitive economic system. It is granted in order to increase the volume

of sales. As such receivables which are created out of credit sales are considered as a marketing tool for


Year Account PayableCost of Goods

Sold

Avg. Payment

Period

2006-2007 161.89 1240.20 46.99

2007-2008 200.23 1504.34 47.91

2008-2009 263.80 1177.18 80.67

2009-2010 451.14 2272.21 71.47

2010-2011 548.73 3096.84 63.79

Year

Inventory

Conversion

Period (1)

Receivable

Collection

Period (2)

Avg. Payment

Period (3)

Cash Conversion

Cycle

(1) + (2) - (3) =

2006-2007 37.74 16.72 46.99 7.47

2007-2008 44.45 23.19 47.91 19.73

2008-2009 66.53 18.23 80.67 4.09

2009-2010 56.46 18.21 71.47 3.20

2010-2011 74.52 16.91 63.79 27.64

increasing sales. But extension of credit involves cost of risk. Therefore, management should weigh the

benefits against cost. As such, the objective of receivables management is to promote sales and profit

until optimum point is reached.

Receivables are created out of trade credit and which are collected in the near future. The debtors have

got the three distinct characteristics:-

(I) it involves risk which should carefully be studied since cash sales are risk less whereas at the time of

credit sales, cash is yet to be received.

(II) It is based on present economic value of goods passes immediately, whereas, the seller expects an

equivalent benefit at a later date.

(III) It implies futurity. The value of goods or services received by the buyer will be payable by him at a

future date.

No doubt, receivables play a significant role in the total current assets composition since their position is

next to inventories. In India, they form about one third of total current assets.

Credit Policy

A firm’s investment in accounts receivable depends on the volume of credit sales and the collection

period. There is one way in which the financial manager can affect the volume of credit sales and

collection period and consequently, investment in account receivables. That is through the changes in

credit policy. The term credit policy is used to refer to the combination of three decision variables:-

(i) Credit Standards.

(ii) Credit Terms.

(iii) Collection efforts, on which the financial manager has influence.

Credit Standards are criteria to decide the types of customers to whom goods could be sold on

credit. If a firm has more slow-paying customers, its investment in accounts receivables will increase.

The firm will also be exposed to higher risk of default.

Credit Terms specify duration of credit and terms of payment by customers. Investment in account

receivables will be high if customers are allowed extended time period for making payments. Collection


Efforts determine the actual collection period. The lower the collection period, the lower the investment

in accounts receivable and vice versa.

Debtor Collection Period

It refers to the debtors converted into receivables. Debtor turnover ratio indicates the number of

times debtors turnover each year. Generally, the higher the value of debtors’ turnover, the more efficient

is the management of credit.

Debtors Turnover Ratio = Total Sales

Average Debtor


Year Total Sales Average Debtor DTR

2006-2007 1393.80 32.37 42.403

2007-2008 1675.20 53.95 31.051

2008-2009 1332.27 33.735 39.492

2009-2010 2507.30 63.435 39.525

2010-2011 3395.49 79.77 42.566

Collection Period = 360

Debtors Turnover Ratio

c. INVENTORY MANAGEMENT

For many business firms, inventory is one of the visible and tangible of doing business. Raw materials, work in process and finished goods all represent various form of inventory. In simple words, inventory refers to stocks of good necessary to do business.

In fact, for a business firm, inventory is both an assets and a liability. Too much inventory consumes physical space, causes of financial burden, and increasing the possibility of damage, spoilage and loss. On the other hand, too little inventory disrupts manufacturing operations, engenders chaos on the shop floor, poor customer service.

Need to hold Inventory:-

Business firm keep inventory for different purpose. Every firm, big of small, trading of manufacturing has to maintain some minimum level of inventories.

Transaction motive:-

Every firm has to maintain some level of inventories to meet the day to day requirement of sales, production process, customer demand etc. the inventory level will provide a smoothness to the operation of the firm.


Year days DTR Collection Period

2006-2007 360 42.403 8.489

2007-2008 360 31.051 11.594

2008-2009 360 39.492 9.116

2009-2010 360 39.525 9.108

2010-2011 360 42.566 8.457

Precautionary motive:-

A firm should keep some inventory for unforeseen circumstances also. For example, supply of raw material may not reach due to strike by the transporters.

Speculative motive:-

The firm may be tempted to keep some inventory in order to capitalize an opportunity to make profit.

TYPES OF INVENTORY

Raw Material Inventory :-

These are goods which have not yet been committed to production in a manufacturing firm. They may consist of basic raw material.

Work-In-Process:-

This includes those materials which have been committed to production process but have not yet been completed.

Finished goods :-

These are completed products awaiting sale. They are the final output of the production process in manufacturing firms.

Supplies :-


A fourth kind of inventory, Supplies or what is called consumable -stores are also maintained by the firms. These materials are of low value & they do not enter the production process, for example oil, fuel, bulbs, soaps etc.

Scrap :-

The waste of materials arising during manufacturing process is also a part of the inventory. Even defective pieces to be disposed off are a part of in inventory.

Inventory Turnover Ratio:-

Inventory turnover ratio indicates that efficiency of firm in producing and selling its product. This ratio is percentage of inventory to the total sales.

Inventory Turnover Ratio: - Total Sales

Average Inventory Investment

Holding Days of Inventory: - 360 days

Inventory Turnover Ratio


Year Total Sales InventoryInventory Turnover Ratio

Holding Days of Inventory

2006-2007 1513.42 130.03 11.639 30.93

2007-2008 1823.39 185.76 9.816 36.675

2008-2009 1384.75 217.55 6.36 56.60

2009-2010 2662.34 365.36 7.47 48.193

2010-2011 3667.41 641.09 5.72 62.94

Financial Ratios

Manufacture sector

(A)Revenue Statement Ratios:-

a) Gross profit ratio: -

Gross profit ratio = Gross Profit 100

Net sales


Particulars 2008-09 2009-10 2010-11Gross Profit 207.57 390.13 570.57

× 100Sales 1384.75 2662.34 3667.41

Net Profit Ratio 14.989% 14.654% 15.558%

14.654%

14.989%

15.558%

Gross profit ratio

2008-09

2009-10

2010-11

Interpretation:- Here we can see that the gross profit ratio in 2010 decreased by 0.353%. It shows the efficiency of the firm but in 2011 the gross profit ratio is increased by 0.904% so we can conclude that in this year the company has the ability of controlling the cost of its inventory and manufacturing products.

b) Net Profit Ratio: -

Net Profit Ratio = Net Profit after Tax × 100 Sales


Particulars 2008-09 2009-10 2010-11Net Profit after Tax 49.58 63.20 87.87

× 100Sales 1384.75 2662.34 3667.41Net Profit Ratio 3.58% 2.374% 2.40%

3.58%

2.374%

2.40%

Net Profit Ratio

2008-09

2009-10

2010-11

Interpretation : In the year 2009, a company is having net profit of 3.58 % that means company

is able to pay all the expenses of the firm but in the next year decreasing trend of net profit also

shows that it is able to pay all the expenses of the firm including taxes, interest and depreciation.

c) Operating Profit Ratio:-

Operating Profit Ratio= Operating Profit X 100 Net Sales

Particulars 2008-09 2009-10 2010-11


Cogs + expenses 1249.87 2366.20 3223.58

× 100Sales 1384.75 2662.34 3667.41Operating Profit Ratio 90.25961% 88.8767% 87.898%

90.2596%

88.877%

87.898%

Operating Profit Ratio

2008-092009-102010-11

Interpretation: The operating ratio is decrease by approx. 2.5 %. It shows that a company has good overall operating efficiency incorporating all the expenses of ordinary daily business activity so it is more profitable.

d) Expense ratio:-


Expense Ratio = administrative +financial+ selling &distribution X 100 Net Sales

Particulars 2008-09 2009-10 2010-11Administrative + financial + selling &distribution

72.69 94.02 126.74

× 100Sales 1384.75 2662.34 3667.41

Operating Profit Ratio 5.249% 3.531% 3.456%

5.249%

3.531%

3.456%

Expense Ratio

2008-09

2009-10

2010-11

e) Stock Turnover Ratio: -


Stock Turnover Ratio = Cost of goods sold Average Stock

20093.73 times

20104.698 times

20113.926 times

Stock Turnover Ratio

Interpretation:- higher inventory turnover ratio is better than a lower inventory turnover ratio. A

higher ratio implies good inventory management and an indication of under investment lower

inventory turnover ratio indication of excessive inventory and over investment in inventory.

(B) Balance sheet ratios:-


Particulars 2008-09 2009-10 2010-11

Total COGS 1177.18 2272.21 3096.84

Average Stock 315.165 483.665 788.71

Stock Turnover Ratio

3.73 times

4.698 times

3.926 times

a) Current Ratio: - The current ratio is a measure of the firm’s short-term solvency. It indicates the availability of current assets in rupees for every one rupee of current liability. A ratio of greater than one means that the firm Have more current assets than current liability to meet short-term requirements. The current ratio of 2:1 Is considered satisfactory.

Current Ratio = Current Assets Current liabilities

“Current Assets=Inventories + Sundry Debtors + Cash and Bank Balance”.

Interpretation: Current ratio indicates the working capital position. The satisfactory ratio is 2:1 but company is showing declining working capital position as their current ratio in 2009 and 2010 approx. 1.32:1 & 1.27:1. In 2011 the ratio is 1.598:1 showing more ratios then previous 2 years, company should take corrective action to increase it.


2008-09 2009-10 2010-110

100

200

300

400

500

600

700

800

900

297.52

502.27

806.01

225.04

395.11

500.66

CA CL

Particular 2008-09 2009-10 2010-11

Total Current Assets 297.52 502.27 806.01

Total Current Liabilities 225.04 395.11 500.66

Current Ratio 1.32: 1 1.27: 1 1.598: 1

b.) Quick Ratio:-

Quick ratio establishes the relationship between quick assets and current liabilities. Generally, a quick ratio of 1:1 is considered to represent satisfactory current financial position.

Quick Ratio = Current Assets-Stock Current liabilities-Bad debts

Particular 2008-09 2009-10 2010-11

Total quick Assets 79.97 136.91 164.92

Total Liquid Liabilities 225.04 395.11 500.66

Liquid Ratio 0.355:1 0.3465:1

0.32941:1

2008-09 2009-10 2010-110

100

200

300

400

500

600

79.97

136.11164.91

225.04

395.11

500.66

QA QL

Interpretation: The satisfactory ratio is 1:1. According to this we can conclude that Garden industry is

having average liquidity position.


c) Acid Test Ratio= Current Assets-(Stock+ Debtors) Current liabilities-Bad debts

Particular 2008-09 2009-10 2010-11Quick Assets 12.50 10.04 5.38

Total Liquid Liabilities 225.04 395.11 500.66

Liquid Ratio 0.055:1 0.0254:1

0.01075:1

2008-09 2009-10 2010-110

100

200

300

400

500

600

12.5 10.04 5.38

225.04

395.11

500.66

LA QL

Interpretation: The satisfactory ratio is 1:1. According to this we can conclude that GARDEN industry

is having poor liquidity position.


d) Proprietary Ratio : -

Proprietary Ratio = Proprietary Fund Total Assets

“Proprietary Fund=Equity Share Capital + Reserves & Surplus + P&L A/c”.

2008-09 2009-10 2010-110

200

400

600

800

1000

1200

1400

1600

1800

2000

435.12490.28999999999

9570.14

1353.89

1518.15

1868.27

Proprietary fund Total Assets

Interpretation: The increasing rate of proprietary ratio shows that the financial position of the

GARDEN industry is stronger, as it signifies that the proprietors have provided larger funds to purchase

the assets.


Particulars 2008-09 2009-10 2010-11

Proprietary Funds 435.12 490.29 570.14

Total Assets 1353.89 1518.15 1868.27

Proprietary Ratio 0.3214 0.323 0.30517

e) Debt Equity Ratio : -

Debt Equity Ratio = Total Long Term Debt Owners Fund

“Total Long Term Debts= Secured Loan + Unsecured Loan”. “Owners Fund = Proprietary Fund”.

Particulars 2008-09 2009-10 2010-11

Total Long -Term Debt 903.97 1027.92 1298.12

Total Equity 435.12 490.29 570.14

Debt Equity Ratio 2.077 2.0966 2.277

2008-09 2009-10 2010-110

200

400

600

800

1000

1200

1400

903.971027.92

1298.12

435.12

490.289999999999

570.14

Total Long -Term Debt Total Equity

Interpretation: An increasing ratio indicates that outside creditors have a larger claim than the

owners of the business.


f) Capital Gearing Ratio :-

Capital -Gearing Ratio = Fixed Interest Bearing Funds

Equity Share Holder’s Fund

Particulars 2008-09 2009-10 2010-11

Fixed Interest Bearing Funds

55.48 87.19 117.74

Equity Share- holder’s Fund

38.29 38.29 38.29

Ratio 1.4489 2.77 3.075

2008-09 2009-10 2010-110

20

40

60

80

100

120

140

55.48

87.19

117.74

38.29 38.29 38.29

Fixed Interest Bearing Funds Equity Share- holder’s Fund

Interpretation: A increasing rate shows that fixed interest is also increasing in comparison to fixed

Equity shares. The reason behind this increase rate is that company is having good amount of profit.


g) Long term funds to fixed assets ratio : -

Long term funds to fixed assets ratio= Total long run fund Total Fixed assets

Particulars 2008-09 2009-10 2010-11

Total Long Term Fund

1339.09 1518.21 1868.26

Total Fixed Assets

850.46 947.57 993.38

Ratio 1.574% 1.602% 1.88%

2008-09 2009-10 2010-110

200

400

600

800

1000

1200

1400

1600

1800

2000

1339.09

1518.21

1868.26

850.46947.57 993.38

Total Long Term Fund Total Fixed Assets

Interpretation: A increasing rate shows that fixed capital is also increasing in comparison to fixed

assets. The reason behind this increase rate is that company is using short term forms in purchasing

assets.


C) Composite ratios:-

a) Return On Capital Employed :-

R.O.C.E = Net Profit before Interest but After Tax X 100 Capital Employed

Particulars 2008-09 2009-10 2010-11

NPBIAT 105.06 156.39 205.61

Capital Employed 1339.09 1518.21 1868.26

R.O.C.E 7.846% 10.301% 11.006%

7.846%

10.301%

11.006%

R.O.C.E

2008-09

2009-10

2010-11

Interpretation: The profitability increased from 2009 to 2010 by approx. 2.50 % but in 2011 the return

on capital employed was more in comparison to 2009.


b) Return On Shareholders / Equity Shareholders Funds :-

Return on Shareholders Fund (equity) = Net Profit after Tax X 100

Shareholders (equity) Fund

11.39%

12.89%

15.41%

R.OS.F

2008-09

2009-10

2010-11

Interpretation: The profitability increased from 2009 to 2010 by 1.50 % but in 2011 the shareholders

got more return in comparison to 2009.


Particulars 2008-09 2009-10 2010-11NPAT 49.58 63.20 87.87Equity Shareholders Fund

435.12 490.29 570.14

R.O.S.F 11.39% 12.89% 15.41%

c) Debtors ratio :-

Debtors ratio = debtors +bills receivable x365 Credit Sales

Particulars 2008-09 2009-10 2010-11Total debtors 67.47 126.87 159.54

Credit sales 1384.75 2662.34 3667.41

Debtors ratio 17.783 Days 17.392 Days 15.877 Days

17.783 Days

17.392 Days

15.877 Days

Debtors Ratio

2008-092009-102010-11

Interpretation:- As from the above table we can see that year by year the debtors ratio is reducing

which shows that the company has less chance of debts and the liquidity position is also good.


d) Debtors turnover ratio :-

Debtor’s turnover ratio = 365 Debtors Ratio

20.525

20.986

22.989

Debtor’s turnover ratio

2008-092009-102010-11

Interpretation:- higher debtors turnover ratio is better than for company to have a good liquidity

position against short term liabilities.


Particulars 2008-09 2009-10 2010-11

Days 365 365 365

Debtors ratio 17.783 17.392 15.877

Debtors turnover ratio 20.525 20.986 22.989

e) Creditor s ratio :-

Creditors ratio= creditors + bills payables x365 Credit purchase

83.65 Days

70.85 Days

65.23 Days

Creditors ratio

2008-092009-102010-11

Interpretation:-. As from the above table we can see that year by year the Creditors ratio is

reducing which shows that the company has good liquidity fund which helps to pay to the creditors

before due date to reduce the burden of liabilities of the company.


Particular 2008-09 2009-10 2010-11

Credit payables 225.04 395.11 500.66

Credit purchase 981.95 2035.60 2801.60

Creditors ratio 83.65 Days 70.85 Days 65.23 Days

f) Creditor’s turnover ratio:-

Creditors turnover ratio= 365 Average account payables

Particulars 2008-09 2009-10 2010-11Days 365 365 365

Creditors Ratio 83.65 70.85 65.23

Creditors turnover ratio

4.363 5.151 5.596

4.363

5.151

5.596

Creditors turnover ratio

2008-092009-102010-11

Interpretation:- higher creditor turnover ratio is better than for company to have a good liquidity

position against short term liabilities.


g) Total asset turnover ratio :-

Total asset turnover ratio= sales Total assets

Particulars 2008-09 2009-10 2010-11Sales 1384.75 2662.34 3667.41

Total asset 1339.09 1518.22 1868.27

Total asset turnover ratio

1.034 1.7536 1.963

1.034

1.7536

1..963

Total asset turnover ratio

2008-09

2009-10

2010-11

Interpretation: The increasing rate of total assets turnover ratios shows that company has a capacity to

sell more and as such its profitability is more.


RECOMENDATONS & SUGGESTIONS

Company should provide required co-operation to the summer trainees & sufficient

information. There should be proper safety instruction to the company visitors and also provide plant map

to visit. Company should make their policies of work known to all type of workers so they can provide

maximum output.

There should be a separate attendance register for visitors & Trainees.

Having a wide market itself in India, so they have to focus on high quality product to compete the market.

It should increase its production so that it can fulfil demand for other states and countries. The company has very poor marketing Strategies. The company does not contact with other retail shops so that it should require focus on

marketing department. The company should increase its service abilities. The company has to introduce more and more designs in their products which can attract

customers at the very first sight. The productivity cost of the company is high so they must reduce their productivity cost. They should increase the no. of distributors throughout the country so that their product will

reach throughout the country. NAVNIRMAN INSTITUTE OF MANAGEMENT

Department

Marketing management:-

(By B.S. Shah & N.D. Gami).

Human Resource Management:-

(By C.B.Gupta & K. Ashwatthapa).

Production Management:-

(By K. Ashwatthapa).

Finance Management:-

(By M. Y. Khan & P. K. Jain B.S. Shah).

- ANNUAL REPORT OF GARDEN SILK MILLS LTD.

Website

http://www.gardenvareli.com http://www.moneycontrol.com/financials/gardensilkmills/balance-sheet/GSM http://www.google.com http://www. Corporateinformation.com


http://www.gardenvareli.com/


http://www.moneycontrol.com/financials/gardensilkmills/balance-sheet/GSM


Profit & Loss account of Garden Silk Mills

------------------- in Rs. Cr. -------------------

Mar '11 Mar '10 Mar '09 Jun '08 Jun '07

Income

Sales Turnover 3,667.41 2,662.34 1,384.751,823.39

1,513.42

Excise Duty 271.92 155.04 52.48 148.19 119.62

Net Sales 3,395.49 2,507.30 1,332.271,675.20

1,393.80

Other Income 16.44 17.89 15.46 19.52 11.58

Stock Adjustments 93.31 67.50 7.62 38.36 32.41

Total Income 3,505.24 2,592.69 1,355.351,733.08

1,437.79

Expenditure

Raw Materials 2,801.60 2,035.60 981.951,301.17

1,068.64

Power & Fuel Cost 203.73 152.74 85.91 87.15 70.62

Employee Cost 72.97 57.35 44.25 45.79 40.08

Other Manufacturing Expenses 15.73 15.95 6.54 20.40 17.72

Selling and Admin Expenses 81.44 53.51 50.13 60.43 51.53

Miscellaneous Expenses 29.57 24.56 16.02 27.76 24.02

Preoperative Exp Capitalised -14.89 0.00 0.00 0.00 0.00

Total Expenses 3,190.15 2,339.71 1,184.801,542.70

1,272.61

Operating Profit 298.65 235.09 155.09 170.86 153.60

PBDIT 315.09 252.98 170.55 190.38 165.18

Interest 117.74 87.19 55.48 63.78 56.87

PBDT 197.35 165.79 115.07 126.60 108.31

Depreciation 76.52 72.56 44.84 57.40 57.57

Other Written Off 0.07 0.14 0.26 0.48 0.65

Profit Before Tax 120.76 93.09 69.97 68.72 50.09

Extra-ordinary items 0.28 0.00 0.00 0.03 0.00

PBT (Post Extra-ord Items) 121.04 93.09 69.97 68.75 50.09

Tax 33.17 29.88 20.41 28.74 26.83

Reported Net Profit 87.87 63.20 49.58 40.00 23.26

Total Value Addition 388.56 304.10 202.84 241.53 203.97

Preference Dividend 0.00 0.00 0.00 0.00 0.00

Equity Dividend 6.89 6.89 5.74 5.74 5.74


Corporate Dividend Tax 1.12 1.14 0.98 0.98 0.98

Per share data (annualised)

Shares in issue (lakhs) 382.91 382.91 382.91 382.91 382.91

Earnings Per Share (Rs) 22.95 16.51 12.95 10.45 6.07

Equity Dividend (%) 18.00 18.00 15.00 15.00 15.00

Book Value (Rs) 148.90 128.04 113.64 102.44 93.75

Balance Sheet of Garden Silk Mills

------------------- in Rs. Cr. -------------------

Mar '11 Mar '10 Mar '09 Jun '08 Jun '07

Sources Of Funds

Total Share Capital 38.29 38.29 38.29 38.29 38.29

Equity Share Capital 38.29 38.29 38.29 38.29 38.29

Share Application Money 0.00 0.00 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00 0.00 0.00

Reserves 531.85 452.00 396.83 353.97 320.68

Revaluation Reserves 0.00 0.00 0.00 0.00 0.00

Networth 570.14 490.29 435.12 392.26 358.97

Secured Loans 1,212.33 948.57 838.09 679.87 634.92

Unsecured Loans 85.79 79.35 65.88 122.28 56.12

Total Debt 1,298.12 1,027.92 903.97 802.15 691.04

Total Liabilities 1,868.26 1,518.21 1,339.091,194.41

1,050.01

Application Of Funds

Gross Block 1,598.40 1,503.64 1,338.641,128.88

1,096.10

Less: Accum. Depreciation 605.02 556.07 488.18 444.07 389.87

Net Block 993.38 947.57 850.46 684.81 706.23

Capital Work in Progress 345.96 195.05 138.38 103.53 15.97

Investments 46.09 76.61 51.58 78.18 129.36

Inventories 641.09 365.36 217.55 185.76 130.03

Sundry Debtors 159.54 126.87 67.47 107.90 64.74

Cash and Bank Balance 5.38 10.04 12.50 21.75 5.41

Total Current Assets 806.01 502.27 297.52 315.41 200.18

Loans and Advances 209.81 223.02 204.37 157.82 145.19

Fixed Deposits 15.75 24.77 60.38 54.41 14.01

Total CA, Loans & Advances 1,031.57 750.06 562.27 527.64 359.38


Deffered Credit 0.00 0.00 0.00 0.00 0.00

Current Liabilities 500.66 395.11 225.04 169.54 139.35

Provisions 48.07 56.03 38.76 30.69 22.54

Total CL & Provisions 548.73 451.14 263.80 200.23 161.89

Net Current Assets 482.84 298.92 298.47 327.41 197.49

Miscellaneous Expenses 0.00 0.07 0.20 0.46 0.94

Total Assets 1,868.27 1,518.22 1,339.091,194.39

1,049.99

Contingent Liabilities 207.80 348.04 26.72 278.53 84.23

Book Value (Rs) 148.90 128.04 113.64 102.44 93.75

NOTES & REMARKS:-


NOTES & REMARKS:-


project report on garden silk mills limited

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