INTERNSHIP REPORT COMPLETE

Internship Report

(Shahkam industries (pvt) limited)

BBA Program

Summer 2016

Submitted to:

Asad Hassan Butt

Submitted by:

DANISH MUNEER L1S13BBAM0062

Contact number 0334-0008955,

[email protected]

Table of Content

EXECUTIVE SUMMARY 1

HISTORY 2

HISTORY TEXTILE INDUSTRY OF PAKISTAN 3

INTRODUCTION OF SHAHKAM 4

INTRODUCTION5 5

OBJECTIVES 5

VISION & MISSION ………………………………………………………………………………………………………….…………..5

CERTIFICATIONS AND AWARDS………………………………..

………………………………………………6

BUSINESS PROCESS………………………………………………………………………….7

ORGANIZATION POLICY…………………………………………………………………….…..9

STANDARDS OF

CONDUCT………………………………………………………………………………….10

WAGE AND SALARY POLICIES……….……………………………………….12-13

BENEFITS AND

SERVICES………………………………………………………………………….14-17

ORGANIZATION STRUCTURE……………………….

………………………………………………………17

BOARD OF DIRECTORS…….…………………………………………………………………………15

DEPARTMENTS …………………………………………………………………16

HIERARCHY ………………………………………………………………………..16

DEPARTMENTALIZATION FUNCTON…………………………..

…………………………………………………….20-30

Structure specialization dept …………………….……………………………….31-32

Marketing Mix…………………….…………………………………………………….32-35

PRODUCT……….………………………………………………………………………32-33

PRICE…………………………………………………………….34

PLACEMENT………………………………………………………………………………………………………………………………….34

PROMOTION………………………………………………………………..35

SWOT ANALYSIS………………………………….………………………………….35

STRENGTHS …………………………………………………..35

WEAKNESSES ………………………………………………………………36

OPPORTUNITIES ……………………………………………….....37

THREATS………………………………………………………………….37

IDENTIFICATION OF PLAUSIBLE PROBLEM(S)………………………………………..38-39

SOLUTION……………………………………………………………………………………..40-42

SUGGESTIONS &

RECOMMENDATION…………………………………………………………………42-43

CONCLUSION……………………………………………………………………43

Bibliography………………………………………………………………………………….44

EXECUTIVE SUMMARY

This internship report is required for the completion of the BBA in finance at University of

central Punjab. I have done my internship in SHAHKAM industries. Shahkam Industries is a

knitwear manufacturing company situated in Lahore, Pakistan. In 1992 it was established and

has been exporting garments to the world’s leading brands in North America and the European

Union since then. Shahkam has not only developed its list of international buyers but also

expanded its manufacturing capabilities and capacities over a period of 20 years. In compliance

with the international laws, regulations, and standards Shahkam has achieved ISO 9001, ISO

14001, SA 8000, and WRAP Certifications. A list of other awards from buyers and institutions

are also part of its profile. Moreover, they help to develop the well-being and progress of its

employees through various employees’ welfare programs and schemes. The main products of

SHAHKAM are polo t-shirt, polo hoody, jeans etc.

This report included the intro of the industry and company, company rules and regulations,

employee benefits and facilitation that they provided, organization structure and management

hierarchy. They have a lot of big and small departments but the main departments of the

company are HR, merchandising, ppc and finance. They do not have separate marketing

department so they do not involve in any promotional activities like advertisement or exhibition.

Marketing mix also known as 4P’S which include product, price, place and promotion. These

4P’S are the parameters that the marketing manager can control; subject to internal and external

constraints of the marketing environment but there merchandisers control the 4p’s. I also discuss

this 4p’s on this report. They develop t-shirts & jeans for young people, girls and also for

children. Basically they manufacture products according to their customer order, whatever they

tell them they produced. They use cost plus pricing strategy because they are just a manufacturer

not retailers. They do not have their own brand.

According to SWOT analysis shahkam strengths are its superior quality and adequate financial

resources. Its weakness is Centralized management system and high cost because of customer

policy requirements. shahkam can avail opportunity through its potential and its international

standards. They can lounge their own brand. Entry of new competitors, Political instability can

be their threats.

TEXTILE INDUSTRY OF PAKISTANIn 1947, at the time of independence Pakistan Textile Industry was like a feeble child with only

three cotton mills, a small woolen spinning, whereas weaving, hosiery and knitwear were

features of cottage industry. Now when we have entered into new millennium, Pakistan’s Textile

Industry has become a stalwart fellow, which has grown in all sections. Now we are not only

self-sufficient but are also exporting surplus products. Today we have over 8.358 million

installed spindles, 166,000 installed rotors 20,000 shuttle less looms, 200,000 power looms,

8,000 terry towel looms, 7620 canvas looms, 157,000 woolen/worsted installed spindles, 15,000

woolen looms, 12,000 knitting machines, over 600 processing units and over 2500 garments

units.

Textile industry today is the backbone of economy of Pakistan and provides the largest number

i.e. about 40% of total industrial jobs and very vast industrial service opportunities. It has always

been the pillar of Pakistan’s economy contributing substantially to Govt. revenues. It also has a

dual linkage. As a major consumer of domestic cotton.

Import and Export of Textile IndustryPakistan Textile Industry is the largest manufacturing industry in Pakistan, contributing 8.5% to

the GDP. It is a major contributor to the national economy in terms of exports and employment.

Pakistan holds the distinction of being the 4th largest producer of cotton worldwide, with the

third largest spinning capacity in Asia.

The Textile Industry is dominated by Punjab. Punjab has a significant share in the textile and

garment sector as it is the largest cotton production region in Pakistan and its finished cotton

garments are exported globally. Cotton is one of the most important cash crops in the Punjab and

contributes substantially to the national exchequer.

ExportsDuring the first nine months of the current 2014 — July, 2013 to March 2014 — textile exports

were up at $10.38 billion which is eight per cent higher than the like period of 2013. Pakistan’s

top five textile destinations now are: United States, United Kingdom, China, Germany and

Bangladesh.

The exports of textiles, including apparel, grew by 6.5 percent year-on-year to US$ 11.437

billion in the first ten months of fiscal year 2013-14.

The textile exports from the country increased by 0.47 percent during the first eight months of

current fiscal year against the exports of same period of last year.

The overall textile exports during July-February (2014-15) were recorded at $9.179 billion

against the exports of $9.136 billion during July-February (2013-14), according to Pakistan

Bureau of Statistics (PBSS)

ImportsThe value of textile machinery imports made by Pakistan during the period under review surged

up by 59.72 percent year-on-year to $489.865 million, which shows that enterprises have started

investing in new machinery, especially after the country attained European Union’s Generalized

System of Preferences Plus (GSP Plus) status. In fact, textile machinery imports in April 2014

skyrocketed by 130.07 percent to $66.374 million.

Total no. of producersTotal number of textile firms in Pakistan are 600 plus.

Major Players of the industry• Crescent Textiles pvt.ltd

• Chenab Textiles pvt.ltd

• Sitara Textiles pvt.ltd

• Kohinoor Textiles pvt.ltd

• Masood Textiles pvt.ltd

• US Apparel pvt.ltd

But main competitors of Shahkam Industries are

• Kohinoor Textile Pvt Ltd

• Masood Textilt Pvt Ltd

• US Apparel pvt.ltd

The Introduction of Organization

Shahkam Industries (Pvt.) Limited was founded in 1992 as a small, family oriented knitwear

Factory with 200 employees and a production capacity of 2000 garments a day. Over the

years the owners and Management have actively participated in the day to day operations and

functioning of the Company. Heavy levels of re-investment and expansion have taken place in a

series of years. In 1996 yarn dyeing was added, in 1998 stripers were brought, in 2002 stitching

was expanded, in 2006 finishing, stitching was expanded and new stripers, solid knitting

machines and Flat knitting machines were added, in 2011 dyeing machines, LPG plant and new

2016/07/28

stitching lines were added and in 2012 we added a new solid fuel boiler, Printing & Embroidery

sections. 

Today in 2015 Shahkam is Pakistan’s biggest composite, vertical knitwear facility. It has a

capacity for 84,000 dozens / month and all the subsidiary departments are within the four walls

of the factory. The total land mass is 11, 74,500 Square Feet and total building mass is

701,481Square Feet.

Corporate Objectives• To increase market share

• To achieve customer satisfaction.

• Making arrangements towards achieving total quality standards.

• To get growth through professional management.

• To growth through professional up to minimum level.

• To control the atmosphere by installation of latest machinery.

• To continue to improve/ surpass past achievement.

• To lead the local manufactures.

• To attain a good word of mouth and to make company image.

• Stronger in the international market

Vision & Mission

Vision To compete with the International Market with the Execution of Highest Standards in

• Quality (Product & Service)

• Productivity

• Cost Effectiveness and efficient

• Employees Well Being

• In order to achieve Customers and Stake Holders satisfaction.

Mission StatementOur mission is to be a dynamic, profitable and growth oriented company by providing

quality products to its customers, a secured and friendly environment place of work to its

employees and to project Pakistan’s image in the international market.

Certifications and Awards

(TECH PACK SHEET)

BUYER

SHAHKAM

MERCHANDISING (COMPLETE PAPER WORK)

STEP#11

SAMPLING Step #2

STEP # 03

Sam

ple

sent

to

buye

r

Step#6

6

STAKE HOLDERS OF MERCHANDISING & PPC DEPPT.

(GIVES THE NAME TO W/O )

OK FROM BUYER FOR PROD

STEP # 7PRODUCTION

DEPPT

COMPLETE QUALITY GARMENT

Yarn purchase

CUTTING

STEP # 8

DYEING

STEP# 9

KNITTING STEP#10

ROTARY PRINTING

PRINTING

STITCHING

STEP#11

12

STEP# 12

STEP#13

STEP # 13

STEP# 14 QUALITYPRESSING

PACKINGSHIPMENT

STEP# 15

STEP # 16

STEP# 17

STEP#3

STEP

# 4

&5

STEP#9

BUSINESS PROCESS:The whole business process of shahkam consists of 17 processes. The main process of the

shahkam is merchandizing that contacts with the customer and take order for production that is

the first step. They conduct meeting with their customers, show their sample to them or to get

tech pack sheet from customers that show the all requirements of production include item size,

color style each and every detail of product. The second step in which merchandisers send a tech

sheet for sampling. Sampling department develop a sample according to the given details.

Merchandiser makes proper check and balance in sampling (3rd step). When the sample

complete, the 4th and 5th step in which merchandiser send the sample to their customers, if any

changes require they tell them otherwise they take order how much quantity they want.

Now in 6th step ppc make plan for the production, they plan how much yarn require for this

production, in how much time the whole order will complete, what cutting plan would be

efficient etc. everything is planned by ppc. And they also give the name to work order like they

give number 20166-06. Now everyone follow this number for producing that specific order.

This plan gives to the production manager that is known to as 7th step. Now production/garment

manager are responsible for complete production. In 8th & 9th step they order for a yarn and give

it to the dyeing manager or to the kntting manager that is decided according to the plan structure.

If it first goes to the knitting then after completing knitting process the cloth send to the dyeing

area (step 10).

In step 11th the cloth give to the unit manager those cut cloth with cutter according to the plan

format and write down each bundle number in register that is known as bundling. Then they

bring that register in ERP department (where I am currently working). We entered all data in

WMS, printed barcode and give to them. This help to make payment of stitching. Now the

cutting men attach each barcode with each bundle and send it to the printing area or stitching

according to the ppc plan (step 12&13). After complete stitching of the shirts or jeans quality

supervisor and his/her worker finishing each product and send it to for pressing (step 14&15).

Then in 16th step the worker pack the pieces in boxes and send to the warehouse. Export manager

deliver the whole order to Karachi port or where the customers said.

Buyer of Shahkam

Customer Name affiliated with shahkam since

Old Navy 1993

Gap 2007

Sears 2007

Macy’s 2007

Kohl’s 1994

American Eagle 1998

Belk 2006

Europe/six sigma 2002

Tom tailor 2014

Only & sons 2015

Organization policy

STANDARDS OF CONDUCTThe work rules and standards of conduct for Shahkam Industries (Pvt) Ltd are important, and the

Company regards them seriously. All employees are urged to become familiar with these rules

and standards. Any employee who deviates from these rules and standards will be subject to

corrective action, up to and including termination of employment.

While not intended to list all the forms of behavior that are considered unacceptable in the

workplace, the following are examples of rule infractions or misconduct that may result in

disciplinary action, including termination of employment.

• Theft or inappropriate removal or possession of property;

• Falsification of timekeeping records;

• Working under the influence of alcohol or illegal drugs;

• Possession, distribution, sale, transfer, or use of alcohol or illegal drugs in the workplace;

• Fighting or threatening violence in the workplace;

• disruptive activity in the workplace;

• Negligence or improper conduct leading to damage of company-owned or customer-

owned property;

• Insubordination or other disrespectful conduct;

• Violation of safety or health rules;

• Smoking in the workplace;

• Excessive absenteeism or any absence without notice

• Unauthorized use of telephones, or other company-owned equipment;

• Using company equipment for purposes other than business (i.e. playing games on

computers or personal Internet usage);

• Unauthorized disclosure of business “secrets” or confidential information;

• Violation of personnel policies; and

• Unsatisfactory performance or conduct.

ATTENDANCE/PUNCTUALITY

The Company expects that every employee will be regular and punctual in attendance. This

means being in the office, ready to work, at their starting time each day. The timing of the

office is 8 to 5. Absenteeism and tardiness places a burden on other employees and on the

Company. If they are unable to report for work for any reason, they have to notify their

supervisor before regular starting time. They are responsible for speaking directly with their

supervisor about their absence. It is not acceptable to leave a message on a supervisor’s voice

mail, except in extreme emergencies. In the case of leaving a voice-mail message, a follow-

up call must be made later that day. The company phone number is 111-007-777.

ABSENCE WITHOUT NOTICEWhen the employees are unable to work owing to illness or an accident then they must notify

their supervisor. This will allow the Company to arrange for temporary coverage of your duties,

and helps other employees to continue work in your absence. if the employee does not report for

work and the Company is not notified of his/her status, it will be assumed after two consecutive

days of absence that he/she has resigned, and he/she will be removed from the payroll. If the

employee become ill while at work or must leave the office for some other reason before the end

of the workday he/she can go by informing his/her supervisor.

TELEPHONE USEShahkam Industries (Pvt) Ltd telephones are intended for the use of serving our customers and in

conducting the Company’s business. Personal usage during business hours is discouraged except

for extreme emergencies. All personal telephone calls should be kept brief to avoid congestion

on the telephone line. To respect the rights of all employees and avoid miscommunication in the

office, employees must inform family members and friends to limit personal telephone calls

during working hours. If an employee is found to be deviating from this policy, he/she will be

subject to disciplinary action.

SMOKING POLICYThe use of tobacco products is not permitted anywhere on the Company’s premises except in

authorized and designated locations. Employees must follow all rules posted in designated

smoking areas and adhere to all policies associated with this policy

INTERNET USE

Shahkam Industries (Pvt) Ltd employees are allowed use of the Internet and e-mail when

necessary to serve our customers and conduct the Company’s business. Employees may use the

Internet when appropriate to access information needed to conduct business of the Company.

Employees may use e-mail when appropriate for Company business correspondence. Not every

employees of the company allow use/access the internet. Specifically those employees access

who have to communicate with their customers or managers. Even not supervisor's access it.

WAGE AND SALARY POLICIESI. Wage or Salary Increases

II. Salary Advance

III. Loan

IV. Timekeeping

V. Overtime

VI. Paydays

Salary

• They have Competitive pay level strategy, based on the ongoing rates within the local

labor market.

• They have developed a hierarchy of Grades and have set a salary structure for each grade.

• Employee’s performance and output are considered as basic measurable units

responsible for each employee’s transfers to an upper grade.

The employees are divided into three major cadres;

i. Management

ii. Permanent Workers

iii. Contracted staff (Piece rate staff)

WAGES

Minimum Wage = 14,000 / Month (Unskilled Worker)

Minimum Wage = 16,000 / Month (Skilled Worker)

Wage day = 5th of every month

O/T Payment = Double (200%)

O/T Payment date = 10th of every month (where Applicable)

All employees receive Salary slip on pay day.

SALARY ADVANCE• Advance against salary can be given to Permanent employees in order to assist them in

meeting their emergency expense.

• Employees can take the advance on or after 25th of current month against current month's

salary.

• Employee forwards the application for advance salary to HR after signature of

department head, CEO, Audit depart.

• After necessary verification the application is forward to the CFO for payment and

adjustment from current month’s salary.

WAGE OF SALARY INCREASESalary will be reviewed at least once each year (from the date of the previous compensation

review). Such reviews may be conducted more frequently for a newly created position. Increases

will be determined on the basis of performance, adherence to company policies and procedures,

and ability to meet or exceed duties per job description and achieve performance goals.

Performance is the key to wage increases in the Company.

OVERTIMEAt Shahkam Industries (Pvt.) Ltd Over time compensation is paid to non-exempt employees in

accordance with Legal requirements. The standard timing of the employee is 48 hours per week.

Overtime is payable after completed 48 hours per week at a rate of double from the basic pay.

Employee must receive the Supervisor, Manager, officer & Chief Operating officer’s prior

authorization. Overtime worked without prior authorization from the authority as specified may

result in disciplinary action. Overtime is limited to a maximum of two hours a day, under normal

circumstances, over and above the eight hour regular duty.

PAYDAYSAll permanent employees are paid on 5th of every month. In the event that a regularly scheduled

payday falls on a weekend or holiday, employees will receive pay one day before weekend and

holiday. Paychecks will not, under any circumstances, be given to any person other than the

employee without written authorization. Paychecks may deposit directly into an employee's

bank account upon request.

LOANAll permanent employees having at least two years of service can apply for loan, to maximum

amount of their Provident Fund.

Employee forwards the application for loan, on prescribed form, to finance section, duly

recommended by the head of department and CEO. Employee repays from the monthly salary.

The loan in eighteen (18) equal installment starting from the month following the month where

in the loan was granted. CEO may give special approval for 24 installments or more. Finance

department deduct the loan from the salary of employee before monthly salary disbursement.

Only one loan is allowed to an employee at a time and no further loan application is entertained.

BENEFITS AND SERVICES• Bonus

• Group Insurance

• Health Insurance

• Social Security/EOBI

• Provident fund

• Transportation

• Hajj Policy

• Employee of the month

• Merit based reward for work above quantity, quality & compliance standards

• Holidays

• Leaves

• Training and Professional Development

• Eid fund (Eidi)

BONUSBonus is related to profit for the Particular Quarter and distributed to all Permanent workers on

Gross Salary.

Employees having completed at least three months service with the organization are eligible for

bonus.

GROUP INSURANCE All types of employees (included permanent, temporarily and piece rate) are covered under

Group Insurance Scheme.

HEALTH INSURANCE (HOSPITAL & O.P.D) The organization provides the free medical treatment to any employee (included wife and

children also parents but for those who have less than 20,000 rupees salaries) injured while

performing the organizational duties (within and outside the premises of the organization) or not,

till the employee fully recovers from the injury. Moreover the organization also gives fully paid

special leaves to such employee till full recovery.

EMPLOYEE SECURITY BENEFITSSocial Security: All permanent employees drawing a salary up to PRs. 8000/ month are referred

to Social Security for Medical & other facilities.

E.O.B.I: All types of employees (included permanent, temporarily and piece rate) are registered.

PROVIDENT FUND All permanent employees after completion of probation period, becomes member of P.F. the

amount of the P.F is 16 percent of the salary and company deduct 8 percentage from employee

salary and 8 percent owner add on it each month.

For example MR KABIR accountant of the company has 30,000 salary with the experience of 4

years so (16% of the salary that are 4800 each month into 48 months)

4800 into 48 = 230,400

Employee can only request Loans, against his/her total P.F amount not more than it.

TRANSPORTATION The company provides free transportation to all employees. Timings are routes of the vehicles

are set and must strictly be observed by the employee.

Chief Officers are provided with car (fuel policy is also defined).

HAJJ POLICY: The organization sends 4 to 5 employees / year to perform Hajj. Only those medically fit

employees who have served the organization for TWO (2) years or more, and have never

performed the Hajj are eligible.

This year employees are selected through draws.

• 2 employees are selected from the labor.

• 3 employees are selected from the office staff.

EMPLOYEES OF THE MONTH / YEARThe head of respective department selects best performing employees (workers, clerical staff,

supervisors and officers only) each month as employee of the month.

EID FUND

The company provided half of the salary in Eid-ul-azha and Eid-ul-fitar for shopping expenses to

each employee.

MERIT BASED REWARD FOR WORK The concerned unit manager along with the signature of the Div. Manager forward the report to

HR office on monthly basis for achieving Quantity & quality targets before assigned dates and

quality standards.

HR & Compliance office verifies the achievement and also attaches a monthly compliance

evaluation report.

If the concern unit is surpassing the performance standards and monthly productivity targets a

specific amount as a reward for their exceptional performance is granted by CEO

LEAVES AND HOLIDAYSCasual: 10 days per year (After completion of probation)

Sick: 8 days per year (After completion of probation)

Annual/Earned: 14 days per year (At completion of 1 year service)

Maternity: 12 weeks (6 weeks each before & after delivery)

Short Leave: In case person has to leave little early than the official timings like he/she

leave the factory in 12 o clock so it will consider half leave.

Gazette leaves: as and when announced (However Company may circulate memo for

working on gazette leave for which CPL will be granted to exempt staff and O/T to non-exempt

staff)

Weekly holidays: as per shift schedule (for General shift this is Sunday)

Organization Structure

Board of Directors Shahid Kamal Butt (Chief Executive Officer)

Khuram khan (HR & CSR Manager)

Khawaja Naveed (Finance Manager)

Umair Butt (Units Manager)

Shahbaz Khan (Quality Manager)

Amin Sb (Knitting Manager)

Sheikh shezad (Garment wash Manager)

Rai Shahnawaz (PPC & Merchandizing Manager)

Miss Shagufta (Training & Development Manager)

Management and Departmental Hierarchy in Shahkam Industries

Shahkam is consisting of the following departments

• Merchandising

• Production Planning & Control (PPC)

• Industrial engineering

• production

• Cutting

• Enterprise resource planning (ERP)

• Stitching

• Finishing

• Clipping

• Packing

• Shipment

• Quality assurance

• Quality control

• Human Resource

• Information Technology

• Procurement

• Finance

• Forwarding

• Stores

• Marketing

• Transportation

• Compliance

• Washing

Number of EmployeesPermanent: 4,100

Daily wages: 800

Contractual: 2,350

Hierarchy of shahkam industries

Chief Marketing officer Muhammad sajjad

Chief PPC Officer Rai Shahnawaz Div. manager

storeChief shipping officer

Chief Electric Officer

Chief Production Officer

Chief financial officer Khawaja Naveed

Chief quality officer

Div. manager HR & Compliance

Chief y/Dyeing & Proc.officer

div. manager admin

Audit Manager

Div. manager Dyeing

Div. manager Garment

Div. Manager Knitting

Commercial Manager

Comm. & Winding Manager

Div Manager y/Dyeing

Chief Executive

Shahid k.Butt

Departmentalization Departmentalization is the arrangement of Individuals job activities into groups and

these groups are combined to from larger department and units to form the total organization

The Departmentalization in Shahkam is very clear. These main departments of shahkam are:

Human resources

Marketing/Merchandizing

Production, Planning and Control (PPC)

Finance

Except quality assurance all department are under the supervision.

(1) HR. Department in ShahkamHR department in SHAHKAM is involved in different types of human resource development

and human resource development activities. Here are the activities of HR department in

SHAHKAM;

• Recruitment

• Training and Development

• Compensation

• Performance Appraisals

• Employee welfare

• Rewards and Punishments

• Retiring and Termination Benefits

1- Recruitment HR Department in SHAHKAM regarding recruitment is almost online up to the middle

level management and has the following procedure;

• Approved strength in each department

• Invitation of vacant or new position applications

• Scrutinizing of applications.

• Test including intelligence and aptitude tests

• Interviews in panel form

2- Training and DevelopmentThe training and development process in SHAHKAM is very strong and has following setup

INDOOR TRAINING

• Apprentices

• Trainee supervisors

• Trainee Operators

• Trainee Engineers

• Management Trainees

• Trainee Officers

• Trainee business analysis

OUT DOOR TRAINING

• Training in institutions

• Meetings and reviews

3- CompensationSHAHKAM has setup for workers as

• Market rate

• Overtime

• Incentives

• Vehicles

4- Rewards and PunishmentSHAHKAM gives in terms of rewards

• Appreciation

• Cash Prizes

• Promotions

In SHAHKAM for the control purpose there are also punishments

• Disciplinary Actions

• Show cause notices

• Suspension

• Terminations

• Charge sheets

• Fines

5- Performance AppraisalsPromotion in SHAHKAM has very fair methodology. Personality and job related traits are

evaluated at regular basis. Best performance results are good rewards in SHAHKAM like profit

sharing and promotion.

6- Employee welfareThere are many employee benefits policies being followed in SHAHKAM. Some of them are as

follows;

• Health insurance

• Social Security

• EOBI

• 15% of Profit

• Transportation

• Canteen and Mess

• Leave Encashment

7- Retiring and TerminationGratuity and provident fund is being maintained for the retiring personals in SHAHKAM.

HR department in SHAHKAM is almost computerized and includes

• HRMS ( Human Resource Management System): in which they store all type of data

related to their employee included their name, address, contact number, employee code,

leaves, fine, loan or others.

• GMS (Gate Management System): in which they have a record of each employees

timing, when they enter and leave the factory on daily basis, according to that timing the

make their salaries. They employee daily scan their cards and thump impression both

when they entered and leaved the factory.

• JOB Bank (Yet to be Introduced): in which they entered the EOB data that are

approximately defined 1% of each salary but the operator tell me that he deduct 50 rupees

of EOB from the employees’ salaries who have less than 30,000 salary and 100 rupees

from those who have more than 30,000 rupees.

Objectives of HR Department in shahkam• To help the organization to reach its goals.

• To give a right job to a right person.

• To increase employee’s job satisfaction and motivation.

• To employ the skills and abilities of the workforce efficiently.

• To develop and maintain a quality of working.

• To communicate and implement HR policies.

(2) Merchandising Customer Merchandiser Factory

Merchandising performs the following functions

• Market analysis

• Data analysis

• Procurement

• Visual presentations

• Feed back

• Product planning

• Pricing

• Distribution

Market analysis includes anticipation of future trends in the market regarding economic, life

style, fashion and competitors. Currently SHAHKAM anticipates the future competitors like

China and India in result of WTO policies and now successfully competing the china in quality

and price.

Analyzing all the available data for improvement and anticipation,

Merchandisers also search about the accessories purchase and to negotiate. Where from they get

good and cheapest things regarding supported to end goods.

Product planning concern about sampling, research and development to see the market trend

they plan for the product design and colors that attract to their customers. They also follow the

customer’s requirement which type of shirts or jeans they want if any changing requires they also

suggest them.

The merchandiser starts his work with new inquires, new inquiries are the customers first knock

at SHAHKAM. The merchandisers increase the sale of products through personal selling,

seminars and physically stall presentation in worldwide cloth fairs and exhibitions. But currently

due to high quality of SHAHKAM and customers trust on SHAHKAM quality SHAHKAM only

relying on personal selling or old customer relations.

When new inquires comes in the merchandising department starts working on it on the bases of

customer demand required in the inquiry. Merchandising department prepare samples on their

requirements.

Confirmation of PO and follow up

After the conformation of PO the merchandiser sends it to PPC and production dept. for

performing their functions. The last function of merchandiser is follow up of the PO from sample

to shipment and communicates with the customer.

(3) Production, Planning and Control (PPC)

Merchandising Production

PPC

PPC works as a bridge between merchandising and production. It stands Production planning

and Control. In this department the works starts when new inquire converted into purchasing

order. The merchandiser sends to PPC department which starts work on it.

Functions of PPC• Optimization of resources (man, machine, material)

• Costing research and development(R&D)

• Purchase order receiving

• Capacity

• Time line (time, action)

• Fabric accessories (stitching and packing)

• Fabric demand plan (lead time)

• Accessories demand plan

COSTING

This is the most important responsibilities of PPC department .It is responsible for

accurate costing of production. The price of the single accessory can’t be ignored .On the basis

of cost, given by PPC,

Merchandiser negotiates with the customer. This is crucial point in getting the purchase order

(PO) the main things that are taken into account during costing and pricing of product are as

follows.

1: Fabric Cost (Yarn Dying and Knitting)

2: Stitching Cost

3: Packing and Accessory Cost

4: Overhead Financial Charges

5: Margin and Rejection

6: Freight on Board

PPC Profile A PPC profile is prepared which contains all the specifications that has been demanded

by customer and distributed to all the concerned departments in which whole execution

of order is done. Following points are included in this profile.

1: Purchase Order

2: Buyer Name

3: Description

4: Quality

5: Color and size Breakdown

6: Time Line

7: Size Chart and cutting Design

8: Packing Program

PPC departmentPPC department have two types of planning regarding production

• Martial planning

• Unit planning or time line & machine planning

Martial planning

Martial planning includes,

• Fabric planning

• Accessories planning

FABRIC PLANNINGEach purchasing order has its own demand about fabric. Each purchasing order has its own

product package. Project package means every purchasing order has a different (GSM) gram per

square meter. There is a slight margin in GSM, which is allowed by the customer due to

shrinkage effect, it is up to 5%. Fabric planning also includes that what type of cotton requires

for producing this fabric.

In fabric planning color and size brake down has another important function, when purchasing

order receives it has its own requirement of color and size. The department has check weather

this type of dying facility has available in SHAHKAM mills or it requires some out sourcing.

Then PPC department informs the mills what size sheet is more efficient for this purchasing

order. What type and gage size is required for this fabric? Weather this size of sheet length is

suitable for this order or not.

PPC also plans for marker making (most precise size for different parts cut from lay sheet).

Department plans the size of sheet which has minimum wastages during cutting

There are two types of wastages from sheet.

• Big wastage

• Small wastage

85% output are required from the sheet. The fashion body part has less efficiency as compare to

simple wear. PPC department also concern a different sizes of a shirt e.g. large, small, extra,

large, and medium.

How many quantities of each size required by the customer and how much sheets size is more

efficient for each size?

PPC transforms all these information to mills for fabric.

ACCESSORIES PLANNING• Stitching

• Packaging

Stitching accessories planning includes thread, buttons, labels, or anything extra is customer’s

wants to attach with the shirt. Sometime customer’s gives some instruction cards attach with the

shirt.

In packaging accessories all the martial includes which will used in packaging e.g. Rappers,

paper packaging.

Finance Department Finance is art of science of managing money.

Shahkam textile mills have a joint finance/ accounts department. As the complexity

and size of the organizations, the finance department of SHAHKAM totally computerized to

record the transactions, instead of recording manually. The finance department of the

SHAHKAM apparel division is connected with the LAN.

The main objective of finance department of SHAHKAM is to manage finance in such a way

that maximum output is taken by minimum input.

SHAHKAM financial administration is very strict in giving information. Company rules are very

strict for it. Following are the main functions of finance department.

Financial ManagementIt deals with the cash inflows and outflows major cash inflows are following.

• Sales Collection

• Interest of Deposits

• Sales of Wastes

• Capital Gains

• Sales tax refund

Major sources of cash outflow are:-

• Purchase of yarn.

• Purchase of raw materials.

• Purchase of fuels.

• Purchase of machineries.

• Wages and Salaries Payments.

• Duties and Taxes.

• Utility bills.

• Printers and its accessories.

• Stitching threads.

• And maintenance of anything that support the end goods.

Function of finance• Preparation of financial statement

• Internal control

• Conduct of audit

• Comparison

• Order wise profit and loss account and their analysis

• Checking of wages and salary

• Procurement bills

• Purchase bills

• GRN

• Service purchase voucher (spv)

• Journal voucher

• Depreciation

• I.T bills

• Machine bills

• Dyeing

• Allowances

• Overtime

• EOBI

• Gratuity

• Marriage and death

• Extra payment

• Local sale

Internship programI am working during internship in Finance departments.

Time/ DurationStart at 19-july-2016 Ending time 30-Aug-2016

Training Program/ job Description• Data entry

• File update

• Barcode generate

• Ticket scanning

Structure specialization dept. i.e. Finance, Marketing, HRM

Structure of Hr. Department

Human Resource Manager

Sr. Human Resource Officer

Human Resource Officer

Management Trainee

Structure of Merchandising Department

Merchandising Manager

Sr. Merchandiser

Merchandiser

Assistant Merchandiser

Management Trainee

Structure of Accounts Department Finance Manager

Deputy Manager Accounts Deputy Manager Finance

Assistant Manager Accounts Assistant Manager Finance

Accounts Officer Sales Tax Officer

Finance Officer

Marketing Mix

1. Product Products of Shahkam are garments and the main garments are:

I. Knitted Shirts (Henleys, Polos, Rugby's, V necks)

II. Knitted Pants (Knitted Jackets, Full Zip, Quarter zip, Hoodys)

SHAHKAM exports whole of its products to US, Germany and various other country.

Major portion of yarn are used in manufacturing process and surplus is exported.

Product Line SHAHKAM is a leading apparel company in Pakistan having expertise &

machinery capable of transforming customer ideas into superior quality garments, which are

taken as the most famous brands in the world.

These includes

Loungewear

Sportswear

Active wear

Sleepwear

Athletic

Underwear

2-price:

Pricing is one of the most important elements of the marketing mix, as it is the only

element of the marketing mix, which generates a turnover for the organization. Shahka follow

cost plus strategy. The price of the product is production costs plus a set amount (mark up) based

on how much profit (return) that the company wants to make. Although this method ensures the

price covers production costs it does not take consumer demand or competitive pricing into

account which could place shahkam at a competitive disadvantage. Like, if the t-shirt cost is

$2.55 then they sale it on $3.

3-placement (Physical Distribution):

SHAHKAM exports its products through two different marketing channels.

Direct Marketing Channels:

SHAHKAM directly contact with its customers through mail,

telephone, and personal contacts and sell its products directly to the ultimately buyers.

Indirect Marketing Channels:

When it comes to indirect marketing channel, distribution is made

through intermediaries. SHAHKAM exports its products through many agents in some cases.

SHAHKAM is using different channels of transportation for the distribution of its products like,

ships, airship etc.

Countries of Export SHAHKAM is making a good effort to increase the market share. Today

company is exporting its products to many countries like,

• USA.

• Hong Kong

• UK

• Germany

• Malaysia

• Singapore

• Korea

• Thailand

4- Promotion: Major export of SHAHKAM is made through tally-mail services. Many contracts

are settled through personal sitting. SHAHKAM do not promote its product.

Promotion is one of the four major important elements. The main promotion tools are advertising

and other country business relationship. The SHAHKAM should advertise its products not only

in the world’s trade magazine also in national industry magazine but they don’t. The company

should have to decide how to set the promotion budget and to invest on it.

SWOT ANALYSISSWOT analysis is a tool for auditing an organization and its environment. It is the first stage of

planning and helps marketers to focus on key issues.

Once key issues have been identified, they feed into marketing objectives.

SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses

are internal factors.

STRENGTHS of the shahkam:

ISO 9002 Certification.

WRAP Certified

Vertically integrated.

Equal to zero % leasing.

Ability to produce own electricity

High quality products.

Excellent market image in international market.

Adequate financial resources.

Latest and efficient machinery.

Adopting information technology.

Recruitment on merit.

Promotion on merit that motivate the employee.

Safe and secure environment.

Experienced able staff.

Skilled Labor

Sales tax refundable.

Broad and motivational vision.

Back Track System

WEAKNESSES of shahkam:

Centralized management system

High cost of production because to fulfill all requirements of customers.

There is no weaving units total yarn import.

Low production capacity.

De-motivated Staff.

Non-Corporative culture.

Insufficient benefits for the employees.

Communicational gap among different departments.

Not Well Educated Management.

Highly cost of transportation and fuel.

OPPORTUNITIES of shahkam:

Can expand its division such as entering in weaving sector also.

Can introduce its own label in domestic as well in international market.

Can capture new market segment.

Can produce yarn for production purpose as well as for export.

Can increase their production capacity.

Can open their own outlets with their own brand name and slogan within the country and as well

as foreign.

Full potential of entertaining the local market.

Can reduce the cost by proper utilization of resources.

Can hire well-educated and experienced staff.

THREATS of shahkam:

Entry of new competitors just like China & India.

Buyer need and demand changes.

Political instability.

Changing geopolitical situation.

Change of government policies.

Low price offered by competitor within same or little low quality.

Globalization.

Tariff and quotas.

Changing of exchange rate.

Terrorism.

Identification of plausible problem(s):

The shahkam is very organized and well-designed because they are following foreign

code of conduct. According to their customer they set their all work that is very effective

and efficient but there is always some area of improvements. There are following

problems that I find:

1) Company name: shahkam name is look very traditional that is consisting of its owner

and his father name (shah mean shahid and kam mean kamil). It does not show any

position that what they offered. This is not good for company long term memory in

the mind of customer.

2) Marketing department:

Marketing is very important department for any organization. It

plays a biggest role to increase the sale of any company. Shahkam does not has a separate

marketing department nor they focusing in promotional activities included

i. Advertisement: Shahkam does not advertise it product because they just make

orders.

ii. Exhibition: they never organized any exhibition or fashion show to promote their

product.

3) Brand Mantra: Shahkam does not have any slogan that tells what the objective of the

company is or which type of product they provide to their customers. This is help

customer to decide purchasing. They are working in an international market so they

should have their own slogan. Without slogan it seems that their marketing

department is really weak that do not good for company image in an international

market as well as in domestic market.

4) Own brand:

Shahkam is the biggest exporter of Pakistan but they do not have their

own brand. They just make order of their customers. They do not have any outlet within

the country or outside the country. They can easily increase their sale by expanding their

business because they have no issue of further investment. Banks also wishes to invest on

shahkam.

5) Slow printer and paper wastage’s:

In ERP each employee printed 2,000 prints daily

from one printer but these are really slow. One lot consists of 200 to 400 pages and

printer stuck the page after 10 to 20 pages that waste a lot of time and the other lots

remain pending. This also increases the work burden.

One of the big problem in ERP that I find are wastages of papers, sometimes printers

printed paper out of its defined boundary or lower quality of ink that remove the barcode

that force the employees to print it again so a lot of papers are wasted daily.

6) Office staff timing:

They give overtime to their all labor but do not give any extra

money to their office workers. They force their employees to work more than 8 hours in

office 2 to 3 days in week. Sometimes they continuously do work from 8 am to 10 pm in

the office that makes them irritated. This is the main reason behind it that in the next day,

they do not completely focused on their work which makes the work pending. It also

demotivates some employee. Merchandisers face this problem more.

7) High transportation cost:

Company is located in the one of the end corner of Lahore

that is far from the all employees home. So they have to provide transportation facility to

every employee. They provide ac van to every office staff and busses to every labor

worker that is really costly. Its fuel and maintenance cost is very high that they have to

bear each month. Even the single employee of the van leaves the factory late night, its

duty of driver to drop him/her at home that consume extra fuel.

8) Slow software:

As I use both WMS and Acro-logix software, these both are really

slow. Sometime it stuck the system and operator force to restart the computer that waste

their time a lot. It makes the employees angry and increases their workload.

Solution

1) Company name: I think now they cannot change their company name because it became

famous on international market. The solution of this problem is that they can lounge their

brand with a new name that show what they offered like they can lounge their new brand

with the name of Chroma that mean intensity of color. So by hear or seeing this new

brand name people can think that we can get different lovely and attractive colors of

shirts or other suits from there.

2) marketing department: They should separate their marketing department, increase the

length of that department and hire some professional marketing managers and

subordinate.

They should invest on promotional activities.

They should advertise their products in different countries where they sale their

product what they make. They can use print media, social media like Facebook

that is very cheapest and useful resource to advertise the products. With the help

of advertise they should ensure their target customers that they offer a quality

product. They realize them that they need their product.

They should organized exhibition on expo centers of their countries. Where they

can promote their product. Present their new design with different colors.

Packing is a biggest trend to promote the brand. They can design a shopping bag

and boxes (on which they deliver their garments to wholesalers) with their

company logo. They can provide shopping bags for their consumers.

They should present their jean, shirts and hood on different fashion shows.

3) Brand mantra: Brand mantra is very crucial for big company. They should make their

own slogan that presents their uniqueness. Basically they are provided quality product to

their customer that is their uniqueness so they should make it according to their uniqueness.

Like “QUALITY IS EVERYTHING”. OR “MAKE YOUR OWN QUALITY”. Why make

your own quality because they make product on sample so what the customer said us me

make according to it. With this slogan everyone know what the company is providing.

4) Own brand:

They should introduce their own brand which can offer in domestic as well

as in international market in which every item include which they already produce. They

should make it with more high quality than now that will be the good for company long term

image. They can easily sale it to their regular customer and also can attract new customers

with the help of advertisement and different promotional activities like discount, bug 2 get 1

free etc.

5) Slow printers and paper wastages: They should buy three big printers for ERP

department and hire a one printer operator to operate it. This is efficient for workers to

printed large number of barcode in less time. When they generate barcode in less time so

cutting persons do not have to stay long in ERP and they can go to complete their work. They

should also use high quality ink on it that do not remove barcode from the paper and operator

also check and balances on prints. If any blank paper attach with the printed papers, operator

make it separate from this. It saves the pages.

6) Office staff timing: They should give authority to their employees to do the work with

their own style. They can give them a target weekly or monthly that will be depend upon the

employee works. They should have check and balances on it. They should motivate them and

als0 compensate them if they achieve their target in given time so they done their work in tie

and will not demotivate. When they know they have to do work with their own style then no

one force them to stay office after their standard timing.

7) High transportation cost: In this time company is bearing high transportation cost

because of their location. First I thought that they should shifted their accounts & finance

department, ppc and other departments in gulberg but the employees of all department comes

from different areas not only from Lahore (rural and urban both), so they cannot shifted it. In

short company has to bear this cost.

8) Slow software:

They should update their software, make budget for it. They should hire an

I.T person who continuously checks out the software problems and update it when needed

that make it more efficient software.

OTHER SUGGESTIONS & RECOMMENDATIONS

There is no doubt SHAHKAM is very organized organization. Still there is always room

for improvements and following are some measures I suggest for improving the

performance of the company.

• Decisions making should be decentralized. Middle and lower level management should

have participation in decision making.

• Company should capture Middle East markets.

• Company should start its own “Apparel Stores Chain”.

• Company should try to reduce workload.

• Promotions, increments and other benefits should be performance based in the company.

• Company shouldn’t depend upon large customers it should also try to capture small ones.

• Company should try to develop over all thinking in employees, not only departmental

thinking.

• Company should try to control wastage of fabric. It reduces cost of production.

• Company should try to enhance its customer portfolio by increasing marketing efforts.

CONCLUSION Shahkam is a big name in knitted garments. Its working environment is simply the

best in Lahore.

The company has fully equipped cutting, stitching and packing units. Its quality

assurance system is one of the best in Pakistan. The company’s infrastructure is good.

Offices are fully furnished. The company is centrally air-conditioned. The company is

working in “Papers less” environment. Computerized bar coding and back tracking

system are there.

Company has good warehousing capacity for fabrics and garments. Customer portfolio of

the company is very broad.

Company has no separate marketing department. CEO and Marketing Manager of the

company perform marketing functions individually.

Company is engaged in merchandising and its merchandising department is very efficient

for taking orders and fulfilling them accordingly. Company’s decision making is

centralized. All major decisions are made by higher management and implemented by

lower management.

Now Company is giving preference to its personals separate personnel department is

established and a ladies wing is also incorporated.

Financially the company is performing well. Its sales are increasing and its profits are

rapidly growing.

Simply I can say that Shahkam is performing well.

Bibliography

http://shahkam.com/social-responsibility/

https://www.google.com.pk/search?

biw=1366&bih=623&noj=1&q=what+is+bibliography+in+a+project&oq=what+is+bibliography&gs_l=serp

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http://www.learnmarketing.net/price.htm

http://shahkam.com/corporate-message/

http://dalspace.library.dal.ca:8080/bitstream/handle/10222/42640/Mathew-InternshipReport.pdf?

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