Report on Poppys Knitwear Limited FINAL1.

REPORT ON STRATEGIC ANALYSIS OF POPPYS KNITWEAR PVT LIMITED

Table of Contents

EXECUTIVE SUMMARY...........................................................................................................................2

INTRODUCTION.....................................................................................................................................3

COMPANY’S PROFILE.............................................................................................................................3

SISTER CONCERNS OF POPPYS...............................................................................................................4

MERCHANDISING DEPARTMENT...........................................................................................................4

POPPYS COMPACT KNIT........................................................................................................................6

POPPYS TAPES: MANUFACTURING OF TAPES........................................................................................6

FABRIC SECTION:...................................................................................................................................7

POPPYS PACKS:......................................................................................................................................8

LILY LABELS - LABEL MANUFACTURING.................................................................................................8

POPPYS ART: THE DYEING UNIT OF POPPYS KNITWEAR LIMITED..........................................................9

POPPYS EMBROIDERY UNIT.................................................................................................................10

POPPYS PRINTING................................................................................................................................10

POPPYS LAB.........................................................................................................................................10

PRODUCTION UNIT OF POPPYS KNITWEAR PVT LIMITED....................................................................11

DOCUMENTATION PROCESS IN POPPYS..............................................................................................12

MARKETING ENVIRONMENTS..............................................................................................................14

CONCLUSION.......................................................................................................................................18


EXECUTIVE SUMMARY:

Poppys Knitwear Pvt Limited is a knitwear manufacturing company which exports garments to countries which are poles apart. The company was started by Mr. A. Sakthivel in the year 1973 and is a large enterprise now with more than 2500 employees. The company is making a turnover of about $70 million per year. This descriptive report about Poppys Knitwear Pvt Limited and their sister concerns describe who they are? What are they doing? And how are they doing it?

The management and the manufacturing process in all the sister concerns of Poppys are explained in detail and analysis is performed on it. A strategic analysis for the company is done to scrutinize the internal environment and the external environment which will be helpful for marketing purpose in the future. The summary of internal and the external environment of the company are given as conclusion for the report which is the SWOT analysis.

TERMS OF REFERENCE:

This is the report written by Mr. Karthikeyan Kumar. B.E, MBA during the internship training period in Poppys Knitwear Pvt Limited, Tirupur. This report is only for the internal use for Poppys Knitwear Pvt Limited and this is written for the purpose of personal assessment of the author which is the part of training.


INTRODUCTION:

Some men see things as they are and say, “Why?” I dream of things that never were and say, “Why not?” - George Bernard Shaw. Every entrepreneur has a history beyond their innovation and imagination. Tomorrow is the most important thing in life. It’s perfect when it arrives and puts itself in our hands. The following is the report on strategic analysis of Poppys Knitwear Pvt Limited. Their analysis is done on the basis of their management and the manufacturing process in all the units of Poppys. The report includes the operations taking place in all the sister concerns of Poppys. The analysis like Pest, Swot, and Porter’s Five Forces are done for the company and a conclusion is given according to the analyses.

BACKGROUND AND DISCUSSION:

COMPANY’S PROFILE:

POPPYS KNITWEAR PVT LIMITED, We Design Dreams for the Future is the tag line of the company. The company was started by Mr. A. Sakthivel in the year 1973 in Tirupur. Company’s annual turnover is about $70 million. Mr. A. Sivakumar the Managing Director’s efforts have been vital to the development of the company as one of the best administered companies in Tirupur.

Poppys Knitwear Pvt Ltd has opened up global markets for its products. It exports to over 50 countries worldwide and is a trusted supplier to global brands like Hanes, Ralph Lauren, Harley Davidson, Caterpillar, M & M, Domino’s Pizza etc. Poppys also has an enviable product range that includes knitted and woven wear for men, women and children.

Poppys Knitwear Pvt Ltd makes such world class products possible by integrating cutting edge technology, infrastructure and global best practices in design, manufacture and quality control. The knitwear division is ably supported by equally well equipped and world class labelling, tapes and packaging units.

SISTER CONCERNS OF POPPYS:


– Poppys Compact Knit

– Poppys Tapes

– Lily Labels

– Poppys Plastics

– Poppys Packs

– Edelweiss

– Poppys Art

– Embroidery and Printing unit

There are many departments in the company which are explained hierarchically. Merchandising department in the company is considered to be an essential one as the first point of entry of orders from the buyers is via merchandisers.

MERCHANDISING DEPARTMENT:

Merchandising is considered to be the back bone process of a company where the merchandiser of the company will be directly in contact with the buyer. This is a very big process where the aim of it is to get the order from the prior buyer and despatch to shipment within the deadline.

The roles of the merchandiser:

The merchandiser is the imperative person of the company whose responsibility is to be very cautious and manage people and process.

Merchandisers work very closely with Buyers and determine the range of goods to be sold.

Merchandiser is responsible for range of merchandise, contents, price and gives policy guidelines to Buyer.

Merchandiser is intended by the buyer requirements to receive the specific sample in order. In many cases, there are changes to the specifications in the right quality and timely.(Purchase order where the entire details of the garments are mentioned)

Three main initial steps in merchandising are


o Fabric Approval

o Fit Sample

o Lab Color Approvals.

The next process is the LC (Letter of Credit) from the buyer. LC contains each and every detail of the garment and its type which is required by the buyer. This is more like a conformation where the merchandiser could start planning with the route map to initiate the process.

The next process is the purchase of bulk yarn. Then following is the Knitting process. Dyeing is the next process after knitting. Finally the fabric finishing. Attachments of accessories according to the requirement of buyer. Packing and Documentation Despatch to Shipment within the lead time.

The following is the outline of merchandising process where the merchandiser is responsible for making the process going on in each and every stage.

Characteristics of a Merchandiser:

Generally a merchandiser should be capable of managing the entire process and use a route map to describe the process. He has to his knowledge from time to time to ascertain the current market trends. He should record preferences for all the activities planned every day, or access time systems. The merchandiser has to find the precise reasons for the moment. This is required to keep records of value and keeping it safe, go as it should be passed with stakeholders and customers. Finally he should be certain that the process of merchandising is a huge amount of time to plan.

Reference: Mr. Karthikeyan, Merchandising manager, Poppys Knitwear Limited.

POPPYS COMPACT KNIT:


Knitting in general can be described as a process of conversion of the yarn to its respective fabric. If we get back to the history of knitting it was handmade for making of sweaters. Knitting of hosieries is practised in common in recent days. There are various types of machines available according to nature of the yarn and the required fabric. 75% of machines in Poppys are Circular Knitting Machines (37) which are used to manufacture the main fabric. The remaining 25 % are flat knitting machines (11) are used to manufacture collars and sweaters.

The process outline in “Poppys compact knit” is follows:

The raw material which is the “Yarn” comes into the company for which it should be converted into its equivalent fabric.

The yarn is then fed into the machines. Then the program is fed into the machine as given by the manager in the

fabric section. Then the managers in the knitting unit feed the program in the circular

knitting machines to manufacture the fabric. The GSM measurements for the fabric are set carefully as it describes the

nature of the fabric. The time management is maintained by the manager and it varies according

to nature of the yarn (20’s, 40’s, and 60’s). The quality control manager keeps an eye on the roll of fabric as soon as it

is out of the machine. If any flaw detected in the fabric, it is rectified by the employee and

corrected to prevent further blemishes. After the quality control and inspection the fabric is ready to despatch.

The different brands of machines in Poppys are Vignoni, Unitex, Orizo, and Smart. All these machines are Italian made ones.

Reference: Mr. John Britto, Mr. Babu, Mr. Keerthi.

POPPYS TAPES: MANUFACTURING OF TAPES

There are two types of tapes namely elastic and non elastic. The elastic tapes are widely used and it is done by knitting and weaving. There are even designs and names of brands woven on the elastic tapes by using the jacquard yarn on it. The management process is more or like same as the knitting. They use the chroched knitting elastic machine for this process. The tapes are usually measured in Deniers.

Reference: Mr. Sivachandran.

FABRIC SECTION:


The manager in the fabric section (roll room maintenance) has direct contact with the merchandisers. The manager in the fabric section will receive the order form from the merchandiser with all the specifications in it. After that the manager will do a program for knitting and forward it to the knitting section which is discussed above. Then the yarn moves to knitting section and comes out as a fabric back to the fabric section (roll room). Then the manager in the fabric section fixes the program for dyeing and sends it to the dyeing section. After prior inspections the fabric manufactured is despatched.

Merchandiser sends the order form to manager in the fabric section (roll room)

The yarn is converted into respective fabric and then the fabric is despatched to the fabric section (roll room).

The manager now fixes the program for dyeing and then the knitted fabric is sent to the dyeing section.

Inspection is done at each and every stage

After the dyeing process it is forwarded to the production unit.


POPPYS PACKS:

Poppys packs is the company who manufacture carton boxes in which the finished garment goods are despatched to the shipment. These boxes are manufactured in various thickness and quality as required by the buyer and mentioned in the LC. The process starts by the purchase of paper rolls from various paper mills. The first process is called corrugation which is the making of flutes in the paper. The rolls of paper are let into the machines and after the process certain lines are made on the paper which comes out as the cardboard. Then the board is pasted with papers on either side with the starch powder mixed with water. The quality of the board depends upon the thickness as the number of cardboards and papers are pasted together (3’s, 5’s, 7’s, 9’s). Then all the boards are sent to pressing. After pressing, the boards are pushed for greasing where the size is properly cut and an impression is made in the length and breadth wise which is used to make the fold. Then the same process is repeated in another machine for making the impression for fold height wise. The final process is slotting where the cuts are made on the board which is helpful during the packing. After all these process if any printing required on the board is done before the despatch.

LILY LABELS - LABEL MANUFACTURING:

The buyers give the design for their brand name and their logo along with the order. The labels are generally done with the polyester yarn in the weaving machine. Lilly Labels use the Mucad software for designing the labels. The design given by the buyer is first scanned and then edited accordingly. Then the design is fed in the floppy and with the polyester yarn in the jacquard weaving machine the labels are manufactured. After that the cutting and folding is done. The laser cutting is also done for designer labels where generally cartoons or any object is required on the labels. Printing is also done in the same unit which are required for the labels. It is done in the different material which is generally imported. The ink for the printing is also imported. Then finally after all the process the labels are ready to despatch.

The raw materials are purchased by the manager according to the requirements and then the entire process is managed. All the process in the garment industry starts with sampling which includes this also. After the samples getting the conformation the bulk manufacturing is done.


POPPYS ART: THE DYEING UNIT OF POPPYS KNITWEAR LIMITED.

Poppys Art is located in Karaipudur. The process of dyeing the fabric with the required color is done here. The following reflects the entire process from the knitted fabric coming inside the company until the despatch of the dyed fabric.

Dyeing is nothing but conversion of a grey fabric to a coloured fabric. Dyeing process consists of many stages in which that fabric undergoes. Essential elements to make the color for the fabric are the dye and the chemicals which brings the color for dyeing in that fabric.

To discuss about the process, the merchandiser will give the sample cloth for color identification or the standard name of the color to the manager in the dyeing unit. A sample is made and it should be approved by the buyer. After the approval, the entire fabric is dyed which contains the series of process. The chemicals and the dye are mixed in the required proportion and then after obtaining the color, the process starts. Initially the fabric is reversed after it comes from the fabric section in SIDCO. This reversing is done to avoid faults in the fabric.

There are two types of dyeing machines in the unit. One is a Pune make another one is the Taiwan make. The mixture of chemical and the dye is filled in the tank of the dyeing machines and then the cloth is inserted with the ends tied. Immediately the dyeing process starts and after the completion, dyed fabric is collected. The dyed fabric is then sent to balloon padding. This process is nothing but like squeezing the fabric so that the water is dried. Finally the fabric is sent to drying. This is done in a machine which generates steam and then dried completely. After this the fabric is again reversed to the normal position. The final process is compacting which is generally known as the sequential arrest. This is done to control the expansion of the fabric and then finally folded. The dyed fabric is then ready for despatch.

The management of this process mainly falls in the color creation and dyeing it with the time management. Certain political issues had affected the dyeing industry and it has been a great disaster to many companies in Tirupur. The company had undergone the regulations of the government and doing the dyeing process in a good standard.


POPPYS EMBROIDERY UNIT:

Embroidery is an art which is all done by machines with the latest technologies in recent days. Poppys has got its own embroidery unit to create designs and labels on the garments. The embroidery process is mentioned in below.

After dyeing and all the process, the fabric comes to production unit. The fabric is cut according to the required dimensions and if required it is sent to embroidery. The fabric comes to this unit if the embroidery is been asked by the buyer on the garment. The particular part of the garment is cut and it is sent for the embroidering. Embroidering is done with the 2 play yarn or the double yarn. This is generally used for making badges. The yarn is purchased separately and fed into the embroidery machines for embroidering. There are brands of machines available namely Damei and Barudan. The cutting for labels is done in the same unit by laser. This makes the work easier as it is done by software called Wilcom and APS-Eltos. The labels which should be attached on the garment are cut using this laser machine. After completing the embroidery process the garments are inspected then and there and despatched.

POPPYS PRINTING:

Poppys has got its own printing unit where this is also just like adding an accessory to the garment. Same like embroidery, printing is also done if asked by the buyer. The fabric for printing first undergoes a process called curing. This is done in order to make the print stagnant on the fabric. The design for printing is first printed on the film. Then the nylon cloth is bolted on the frame with the help of vacuum machines. After that the printed film along with the frame is kept on a machine so that the print comes on the frame. After that the frame is kept on the machine and with the suitable coloured ink the printing is done manually. There are also automatic machines for printing available in Poppys printing unit in Karaipudur. After printing, certain garments undergo a process called fusing in which the print is pressed with the steam for making the print heavy. Then the finished garment is also sent for curing if required.

POPPYS LAB:

Poppys has got a lab where the testing of garments is done for knowing the various characteristics of the garment. They are

Shrinkage GSM Spirality Color fastness against washing, water, perspiration, rubbing.

These processes are done in order to test the fabric’s quality and control. The garment after manufacturing will pass all the tests in the lab and get approved to be manufactured in bulk.


PRODUCTION UNIT OF POPPYS KNITWEAR PVT LIMITED:

Poppys Knitwear Limited has got its own production unit in New Tirupur Apparel Tech Park and another one in Padiyur and Coimbatore. The following reflects about the process of manufacturing garments in the factory and how the management takes responsibility in each and every process until the goods are despatched to the shipment.

After the process of knitting, dyeing, compacting, etc the fabric comes to the production unit. Lots of processes takes place in this unit like cutting, sewing, accessories attachments, packing and despatching. Each and every process is explained hierarchically.

The fabric enters the production unit with all the dimensions of it for identification. The diameter of the fabric is watched intensely as this variation can lead to exertion. The roll of fabric is weighed again and cross checked. After that the fabrics are arranged in proper racks which are generally alphabets for identification. They are arranged with their dimensions and denoted with the buyer’s name. Then the fabric is inspected using the four point system and if any flaw detected a sticker is placed on it so that it can be rectified by the cutting employees. Generally, for every order 10 % of the fabric is inspected. There is a point grading system for calculating the number of flaws in the roll of fabric which is generally measured in Kilograms. For each and every 100 sqm, 30 points of flaw is allowed. As the fabric is measured in Kilograms the points are also mentioned in kilograms and then converted for sqm. The shade verification and the GSM verification are also done. There is also a dark room available for testing. Then the fabric passes to the cutting section

The cutting process is done with laser cutting machines and also manually. It depends on the type of the fabric which decides how it should be cut. There are two brands of machines for cutting namely Lectra and Gerber. First a machine is used for laying the fabric on the table and the diameter is checked. The flaws are also noted here. After laying the fabric on the table, the design is fed into the machines using cad and the fabric is cut using laser. This is a less time consuming process which can cut the fabric in required dimensions. For certain fabrics which are stripped cannot be cut using the laser machines as the lines should be matched accordingly. After cutting each and every part of the garment is bundled. Then the bundles are stored. There is an inspection team. Then the fabric is stickered as it can be identified easily. Certain portion of the garment should be stiff and it undergoes a process called fusing. This is nothing but the certain piece of cloth is kept along with the foam and allowed to pass through a machine. After that the fabric passes on to the sewing section.

In the sewing section there are lines of machines where the cut fabric passes the line and come out as the finished garment. The floor is divided into lines where each and every line consists of series of machines. The cut fabric passes the series of


machines and comes out as the finished garment. The stitched garment is again inspected. If any embroidery is required on the garment that particular portion alone is send for the process and received. The garment is passed to the AQL audit section. After stitching the garment is send for ironing and packing.

The garment is then ironed according to the requirement of the buyer. The garment is wrapped in the polybag and then stored. According to the requirement of the buyer the garment in the polybag is packed in the carton boxes. All the essential information about the garment is mentioned in the label of the carton boxes. The garment is then despatched to shipment.

This is a man power and a time consuming process. The unit is well maintained and managed with all requirements. All the process should be watched keenly as a single flaw could lead to a great disaster.

DOCUMENTATION PROCESS IN POPPYS:

For each and every export and import done in a company, it should be done with proper documentations. The documentation department is responsible for any good imported or exported. Likewise the documentation process done in Poppys is observed and the following report reflects the process. This department works as an intermediate between the buyers as well as the suppliers and get the work done for the merchandisers of the company.

There are various types of essential documents required for imports and exports. The documentation department of the company becomes active whenever there is a shipment, airway towards or outwards the company. In the purchase order given by the buyer, it would be specified that certain accessories for the garment should be bought from the particular supplier only. Henceforth the merchandiser will inform the documentation team so that they would take the responsibility on their shoulders to import the goods from the particular country.

There are certain INCO terms involved in documentation. They are

FOB- Free on board

CFR- Cost and freight

CIF- Cost insurance freight

DDP- Delivered duty paid and many. These are the most commonly used

terms and essential ones too.


The important documents which are required during the import are

Invoice

Packing List

Sea – Bill of lading or Air- Airway bill

Bill of entry

Technical write up

And it also depends upon the country as the norms and regulation varies for each and every country. All the documents are important for export also but the bill of lading is replaced by bill of shipment. Rest others are common for both.

E.g.: US- Certificate of Origin.

UK- European countries: GSP (Generalised system of preference).

There are 3 types of agents who can be involved during the shipment.

1. Liner

2. Freight forwarders

3. CHA- Customs House Agents.

The liners can be of two types namely the vessel operator and NVOCC (Non Vessel Operator Container Carrier).

The freight forwarders act as an intermediate between the supplier and the liner. They are like agents where there are lot of benefits while going through the freight forwarders.

There is another agent called C&F, who act on behalf of the supplier and the buyer to declare the purpose of shipment and the product details. They are also responsible for collection of duties.

The problems faced by the documentation team:

The rules and norms vary for each and every country and it should be observed carefully.

The time varies for importing a product from one country to another. If any problem occurs in shipment delay, then it should be done by air which

again increases the cost. The terms should be properly fixed as each and every term has got different

function.

Reference: Mr. Deepak.


MARKETING ENVIRONMENTS:

The marketing concept is about matching a company's capabilities with customer wants. This matching process takes place in what is called as the Marketing Environment. The marketing environment consists of actors and forces outside the organization that affects management’s ability to build and maintain relationships with target customers. It is broadly classified into two, namely;

Micro Environment Macro Environment

Actors who are close to the company that affects its ability to serve its customers come under the Micro Environment. The actors of the Micro Environment are

The Company Suppliers Marketing Intermediaries Customers Competitors Public

The company:

Poppys Knitwear Pvt Limited is a large enterprise and there are more than 2500 employees in the entire group. Every concern that is mentioned above has managers who are responsible for their firms. The company experiences insufficient labours which is been a common problem in Tirupur now. The employees in the company should take responsibilities as this is more like a team work and if anything goes wrong at one stage the entire process could be a fiasco.

Suppliers:

The sister concerns of Poppys are the major suppliers of the company. For certain orders the buyers want Poppys to get the accessories from the particular suppliers only. So a delay in delivery of good from the supplier may also affect the manufacturing of garment in the company. Even the transport agents are the suppliers for the company.

Marketing Intermediaries:

There are no such intermediaries for the company for marketing purpose.

Customers:


The customers of the company are:

Hanes

Ralph and Lauren

Harley Davidson

M&M

Caterpillar

Next

Gap

C&A

Carter’s

M&S

Michael Morgan

Bloomingdale’s and more. . . .

Competitors:

The competition in the garment industry is high. There are many players in the industry who are even the market leaders. The major competitors for the company are Eastman Exports, KPR Mills Limited, etc

Macro Environment is external to the company. The actors of Macro Environment are not closely related to the company. This analysis is done for the Tirupur garment industry.

Political Economic Social Technological

PEST analysis can be used for marketing and business development assessment and decision-making, and the PEST template encourages proactive thinking, rather than relying on habitual or instinctive reactions.

POLITICAL:


Initiatives of government bodies and employers associations. Apparel Export Promotion Council (AEPC) Technology Up gradation Fund (TUF) South India Hosiery Manufacturers Association (SIHMA)

Legal Provident fund and Employees State Insurance Labor Act Inspector of Factories Sales Tax Labor and Payment disputes conciliation Training to upgrade existing workforce in the industry Bringing in Fashion forecasting and Trend analysis information to the

industry Tirupur Exporters Association (TEA) Netaji Apparel Park Tirupur Export Knitwear Industrial Complex. (SIDCO INDUSTRIAL ESTATE) New Tirupur Area Development Corporation Ltd. (NTADCL) Indo- Italian Chamber of Commerce Tirupur Industrial Federation (TIF)

ECONOMICAL:

With the abolition of quota system in January, 2005 and the imposition of a 10% cap on Chinese textile exports till 2008, the Indian textile exports are under a mega-bonanza altogether. As per data available from the Indian Govt., textile exports to U.S.A leaped up by 26 per cent and those to European countries increased by 18 per cent, since 2005. China’s export growth in the last quarter of 2005-06 stood at nine per cent, while that of India went up to 13 per cent. However, there continues to be a sharp difference in value terms between exports from China and India. China clocked $120 billion in export of textiles and clothing in 2005, while India earned a mere $17 billion that year.

Tirupur that accounts for 90% of India’s cotton knitwear export has gained the most in the milieu of the post-quota textile boom. Its export earnings shot up from Rs.4726 crores in 2004 to an estimated Rs. 8000 crores in 2006, nearly a 70% growth in two years. The bustling business of knitwear exports crossed Rs.9600 crores between January and December 2006.

Correspondingly, Tirupur is passing through a revolutionary renovation: 1) at the level of the individual plants; 2) the level of joint-facilities such as apparel parks, clearing houses, marketing net-works etc. and 3) the level of civic infrastructure.

REFERENCE: The New Developments in Tirupur, Produced by FWF, with inputs from Mr. Angelis, Advocate, Mr. Prithiviraj, CARE, Mr. Narayanasamy of LRC – SAVE and E. Rajarethinam, GCT. October 2006.


SOCIAL:

There must be ethical issues during exports and imports as two different countries are involved in the transaction.

Consumers of the company are the people who are in businesses. So b2b marketing is required.

Buying access and trends might change according to the recession in each and every country.

Any law introduced by the government might affect the social factor of the country.

TECHNOLOGICAL:

Technology plays an important role as constant improvements should be adapted by the company.

Money should be spent in abundant for adapting. The company should increase the technological facilities to do the betterment.

CONCLUSION:

The management and the manufacturing process in the Poppys Knitwear Pvt Limited are explained. The internal and the external analysis for the company are done and


the summary of it is given as SWOT analysis in the conclusion. The company has got a good profile with all the necessary infrastructures and capabilities to do better.

SWOT ANALYSIS:

Swot analysis would give a brief explanation about the business, the ability of the business to perform and its drawbacks as well.

STRENGTHS:

There is a need for the manufacturing of clothes always as it is a basic necessity for every individual.

The locality is the biggest strength for this business as it has got all the resources including the cargo, airport etc.

The fashion industry is growing in a bigger rate and latest trends are being updated by big retail outlets and branded shops.

Cost arbitrage in China is a major issue where most of the orders will pour into India in forth coming years.

WEAKNESS:

It is a vast industry with lot of players. Lot of competitors i.e. SME‘s who are currently in the market.

OPPORTUNITIES:

There are lot of opportunities of expanding the business internationally. Involve in direct exporting to developing countries.

THREATS:

Anyone can copy the design of the product and manufacture once the design is out.

There are threats for new entrants i.e. the small players in the industry who are ready to do job orders for big companies.

Report on Poppys Knitwear Limited FINAL1.

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