Report

Program: MBA
Course: Strategic Operation Management

Selected Company’s Operations,

Gul Ahmed Textile Mills

(Spinning Unit)

Faculty: Mr. M. Irfan Ali

Bahria University Karachi
Submitted By: Sajid Majeed (22998)
Najma Afzal (

Submission Date: ……
COMPANY PROFILE & HISTORY

Gul Ahmed was incorporated in 1953 as a private Limited company and became a Public
Limited company in 1955.1t began as on unquoted Public company with 25000 spindles
and 250 Looms. It was listed on the Karachi Stock exchange in 1970.

It has since grown steadily into a composite unit with the following installed capacity:

Spinning Units Ring Frames 97,000

Weaving Units Air Jets 220
Sulzers 90
Conventional 342
---------
Total 652 Looms

Preparation Singeing Bleaching Mercerizing

Dyeing Pad Steam Thermosol Hot Flue
Printing Rotary Flat Tables -
Finishing Agers Stenters Calendars
Coating Unit Back Coating Flocking Velours

Today it is one of the larger textile mills in the country having over 5000 employees. The
company continuously strives to maintain its position as industry leader in sales growth
and low cost production. This remarkable development has been possible through
commitment to technology, and an honest approach to doing business.

At Gul Ahmed we believe in thinking beyond bottom lines, like contributing to every
conceivable service, such as fulfilling customer expectations, employees housing to health, from
parks to environment, from schools to charities, the nation and mankind at large.

The company exports made up household articles globally, and is its main business, and
in the home market, sells dyed & printed lawn for ladies, and a variety of cambric &
poplins for gents.

Gul Ahmed Textile Mills Limited

Gul Ahmed Textile Mills is a composite textile unit, with the following facilities.

Ring Spinning of Cotton & Poly Cotton yarn

Weaving of Grey fabric
Processing & Finishing of Cotton & Poly Cotton Fabrics
Stitching of House Hold Textiles including Curtains.
Location:

Company Address

HT/4B Landhi Industrial Area Karachi 75120

Pakistan

Telephone 92-21-5082626-30
Fax 92-21-5082625
Email [email protected]

Operations

1. Spinning.
2. Weaving.
3. Design & Styling.
4. Pretreatment, Printing, Dyeing, Finishing.
5. Hemming of house hold textiles.
6. Quality Control.
Group of Companies
Following is the list of companies, which are part of the group.

Gul Abmed Textile Mills Limited

Swisstex Chemicals
Gul Abmed Energy Limited

Business Activities

Textiles
In the textile field, activities start from spinning of raw cotton and man made fibers, and these
are spun into yarns. These yarns are then woven into a variety of fabrics, which are processed
and finished in all types of cotton and blended fabrics, bed linen and home textiles including
curtains.

Apparel
Gul Ahmed’s Apparel Division has established a tremendous presence in the International markets
especially in United States and Europe, since its establishment in Year 2006. We supply to major
clothing brands and large buying houses. Our sewing manufacturing facility has an in-house
production capacity of 5.4 million units per annum and is 100 % export based.

We produce the highest quality garments and our entire organization and production processes
are equipped and continuously updated to satisfy our buyers. Our reputation and commitment
with our valued customers is our highest asset

Power

The group is pioneers in the field of power generation. The textile mills are on self-generation
with an installed capacity of more than 20 MW.

Management

Management of the group is professionally qualified and broadly experienced. The company's
director has held top position in various textile bodies, exports committees and assisted the
government of Pakistan in trade talks & negotiation with EC & USA authorities in framing
textile policies.

Mission Statement:

“To produce quality products through emphasis on consumer needs and to

earn profits through total consumer satisfaction.”

Vision Statement:

To be the textile leader of value added products in Pakistan and to achieve a

turnover of 300 million US $ in the next 15 years.

Product:

Gul Ahmed's fine textile products represent a unique fusion of the century old traditions of the
east and the latest textile technology of the west. The purest of cotton fibers, produced from the
fertile lands of the Indus Valley, are spun, woven and processed into the finest quality cotton and
blended products through a combination of latest technology, skills and craftsmanship of this
traditional industry.

1)Bed-Linen
Quilt covers ,duvet covers, flat and fitted sheets, pillow covers, valance sheets, bolster case with
all sorts of fancy confectioning, embroidery and embellishments, packed to buyers' specific
requirement.

2)Curtain
Ready made curtains lined, un-lined and taptop curtains, plain or fully accessorized with
tiebacks, pelmets, cushion covers, in different styles of confectioning and embroidery, packed to
buyers' specific requirement.
3)Fabric
Running meter fabrics, packed to specific requirement.

)Yarn
Gul Ahmed specializes in medium-to-fine-count cotton yarns and is also capable of producing
yarns using a wide variety of synthetic fibers including polyester, rayon and other man-made
fibers.

5)Others
All APPAREL Articles , Boxer shorts, carpenter shorts, Men’s , Boys , Women’s Tee Shirts,
Hooded, Trouser, Apparel Items, cycle shorts, table linen, kitchen linen, sofa cover, quilted
articles including bed spreads, comforters, etc.
 SPINNING PROCESS

Production Facility.
The production facility comprises of several departments. First the cotton bales are received at the
warehouse. This cotton is purchased based on the sample selected and onwards approval from the lab.
Cotton Bales are mostly purchased from Sind, Punjab, and in some cases even from abroad. The most
frequently purchased cotton is MNH 93 produced in Punjab.

Plucking.
At this stage cotton bales are manually opened and are put in Pluckers. Pluckers are machines
which mix the cotton and separate the bales into smaller denominations. The separated cotton is
then transferred into the Blow Room.

Blow Room
The Blow Room is a facility, which is primarily used for the Cleaning, Mixing and Opening of
cotton for yarn production. Cotton is processed through various stages in this area through
different machines and the main objective is to refine the cotton being used in yarn production. A
brief description of the machinery used is given below.
Auto Blender: Primarily used for mixing cotton. This means that the cotton fibers are separated for
the facilitation of the cleaning process. Waste at this stage is also removed.
B-11: This machine is mainly used for trash removal. The cotton is passed through channel with air
pressure. Trash is removed and deposited at the bottom of the machine while the cotton is passed on
for further processing.
Multimixer: Again multimixer is another machine used for further mixing and opening of the raw
cotton.
Heavy Particle: As this is self explanatory this machine is used to remove trash and Separator
facilitates in the cleaning process.
Tower Feed Free: This is mainly used for beating cotton so that the fibers are further Roller aligned.
Tower Feed Free: This is mainly used for the further waste removal and fine opening of Fine Opener
cotton fiber.
Tower Feed Free: The tower has wires attached to its beater which further separates the Wire Opener
fibers.
Vision Shield: The vision shield is yet another equipment to purify the raw cotton. This device
contains sensors which sense the foreign particles (Trash) i.e. polythene, leafs etc. and sucks them out
of the raw cotton through air pressure.
D Duster: This is the final stage in the blow room in which even the tiny and micro dust particles are
removed from the raw cotton. Once the cotton is passed through the D Duster it is transferred into the
Carding department.
The Carding Department.

The main function of this department is to transform the cotton into Sliver. The main objective here
is to maintain the uniformity, alignment and stretch ability of the fiber as per the desired standards.
Once the Cotton is turned into Sliver it is filled in Cans. Cotton is passed through Drying Breaker to
maintain the uniformity; the fiber is straightened. The sliver is then passed to Drying Finisher is for
the same purposes however the only difference is that of the Auto Leveler. The Auto leveler is
primarily used for controlling the variation in uniformity (weight) of the sliver. The unit of measure
for uniformity is “Grain”.

Simplex.

Simplex is the process of shaping the Sliver into Roving. The main processes involved are Grafting,
Twisting and Winding the sliver and shaping it like a thin rope. There are currently six machines
used for turning the Sliver into Roving. Each machine has a capacity of 120 spindles. Spindles are
the equipment on which the Roving is collected. The unit of measure of roving is Hanks. Once the
roving are collected it is passed on to the Ring Department for yarn production.
Quality control
For a company to survive and measure its market share, maintaining quality is as essential as blood in
the human body. The company, which maintains quality, has edge against those, which don’t pay
great attention on quality. Whether it is a manufacturing firm or a service organization, they have to
take care of quality if they want to remain in the competitive market.

Firm pays a lot of attention on quality because it has maintained its image as a qualitative
organization. Quality is checked at every section and if it is found according to the standards then the
next process starts otherwise first of all that fault is removed and then the material is sent to the next
department. Quality check is important for the company as it allows the company to avoid process
repetition so it saves Time, material, labor and customer dissatisfaction that van result in loss of
market.

Laboratory

Firm has its own quality control department in the form of a laboratory, which is responsible for
checking quality after every process. The samples from every department are sent to the laboratory
and these samples are then checked. If the quality is found correct, then the material is allowed to the
next process.

Quality control process

The quality control process is as follows

Raw material purchase

Purchase of qualitative raw material is prerequisite for maintaining quality standards. It is for this
reason that material is inspected before purchase. Samples are taken from different suppliers and
checked on random basis because it is difficult to check the whole lot. If the quality is according to the
standards and the price is appropriate then that supplier is selected. Complete lots are not checked for
the following reasons
· Time constraints
· Cost involved
The quality is checked on the following basis
· Strength of cotton
· Short fiber
· Long fiber
Quality maintenance during process
After the material is issued to the production department, quality checks are effectively maintained at
each and every step of operation. Quality may get out of control because of the following reasons
· Fault of machine
· Fault of worker
So, it is necessary to check quality so that if there is any fault, it can be removed. During the process
following intermediate products are checked for quality
· Lap
· Sliver
· Roving
· Bobbins
· Cones
If any of them is not according to the standards, the process is repeated and the faults are removed.
Final quality checks
Final checking of the finished goods is necessary because if has any type of fault, and it is sold
without checking the quality then company can loose its market image. It is for this reason that
quality of the final product (Yarn) is checked with great attention.

Weight checking
The finished product (yarn) at last stage, checked for weights that should be according to the
standards i.e. 100 pound per bag. If the weight of any bag is less than this standard weight, it is not
sold until weight is correct.

Shade checking
Before packing the cones for sale, these cones of Yarn are checked in Ultraviolet Rays for correct
shade. If the shade is according to the standards then these cones are sent to the storeroom, otherwise
sent back. Firm has a separate section for checking the shades of these cones. It is a dark room with
tubes of Ultraviolet Rays. The cones are set at the racks and these racks are sent to that room, for
shade checking.

Aggregate planning
Firm is a process focus organization and it responds to the customer’s orders. They make planning
based on the previous cycle. They are operating according to the “Make to order strategy”.

Competitive priorities
Competitive priorities are the company’s unique characteristics that lead to success of the company.
Every organization has some competitive priorities, which shows the progress of the company.
Firm is operating according to the following competitive priorities
· Low cost
· Consistent quality
Planning
Planning is made by directors with the help of different managers.

Planning of workers
It includes the planning of officers, supervisors and workers. Planning of officers is dependent upon
the owners that how much they need and according to the need this staff is recruited and the duties are
assigned on the basis of their skills.

Every department is headed by a supervisor who is responsible for every thing happening in the
department.

Workers are allocated according to the machines and workload.

Production planning
Production planning is done by production manager on the following basis

· Requirement of the market

· Availability of raw material
· Prices of raw material
· Prices of end product
Aggregate planning is made considering the following factors

1. Cost of production of new order

2. Time to complete
Forecasting
There is no special method of forecasting. They have to make forecasting at the time of purchase of
raw material. Forecasting all the times depend upon the Judgment Method that is based on past
experience i.e. the demand of last period.

Forecasting is always the job of directors whereas the General Manager assists the directors about the
decision of purchase.

Forecasting is about
 How much orders will come in future
 What quantity will be coming from these orders
 What will be the specification in that requirement
So on the basis of this forecasting they purchase their raw material. If there is excessive demand than
forecasted and the raw material in the stock is finished then they make production by purchasing that
much of raw material that is needed to satisfy that excessive demand. They wait for the cotton season
to purchase raw material to store for the next period.

Purchase process
The purchase process is not so much complex rather it is quite simple. The purchase is made only one
time during the cotton season from November to February. They purchase inventory for the whole
year because, at that time fresh cotton is available and the prices are also low because of the
abundance of cotton. They ask for the samples from different suppliers. Then there is complex
analysis of those samples on the basis of following factors.
Short & long fibers
Strength of the fiber
The sample for checking is taken from each lot of 100 bales. If the quality of the sample is according
to the requirements then that supplier is selected for the purchase of raw material.

Gul Ahmed doesn’t make long term contracts with suppliers because they want to reduce the cost, so
the supplier who is giving the low cost and high quality is selected which may differ from time to time.
At the time of every purchase the process of checking the quality is repeated and the best one is
selected.

Requirement of the Mill

The daily requirement of the Mill is about one lot and every lot contains 100 bales of cotton. The lots
for the whole year are purchased at the start of the season.

Price of purchased material

The prices of cotton vary during the year. When it is in abundance the prices are comparatively low
and the directors are eager to purchase more and more cotton because of less price. The situation can
be reversed when cotton is scarce due to some reasons, then prices are very high and the company
doesn’t purchase in large quantity. It all depends upon the directors that what decision they make
during the particular season.
Payment to supplier
Payment to suppliers can be made in two ways
Payment is made in advance in the form of check or draft
Payment can be made after the inventory is received

It depends on the terms and conditions between the supplier and directors that in what way they make
payment. These terms and conditions are set after the quality of the raw material is checked by the
laboratory.
Inventory management
Inventory is the stock of items held to meet the future demand. Being the process focus firm pays a
special attention to the inventory management.

The inventory mainly consists of raw material i.e. cotton bales and in the form of work in process.
There is no concept of finished goods inventory because company produces according to the demand.
But in some cases when there is a slump in the demand then finished good is stored otherwise not.

Raw material inventory

The inventory management is not so difficult. Cotton for the whole year is purchased in the start of
season and is pledged either by BANK.
As the raw material comes in the factory they call personnel from the bank. That person examines the
inventory and gives report to the office and then the bank pays for that material and then material is
placed in the warehouses. It means that inventory belongs to Bank. A man from bank is always
present at the warehouse where the inventory is placed and that person is called “godown keeper”.
When there is need for cotton in factory, they ask to that person to give the material of their
requirement.

The basic purpose of keeping the raw material inventory is

· To meet the demand of individual customer and the market as a whole.
· To make efficient delivery possible
· To provide a hedge against the demand
· For the smooth running of the company’s operations

Grading of raw material

The raw material is placed grade wise on the basis of quality. There are different grades of cotton e.g.
A+, A, A-, B+, B, B-, C+, C, C-, D+, D, D- etc. firm is currently operating in B+. There is
computerized checking of raw material and after that raw material is placed under one of these
categories.

Work in process inventory

As there are different machines in different departments and these machines have some part of raw
material that is called work in process inventory. Firm always has about 60 thousand kg of cotton in
process to meet the requirement of spindles.

Safety stock
There is no concept of safety stock as there is already surplus of inventory.

EOQ
There is no concept of EOQ. It all depends upon the management that how it views the changing
environment.

Spare parts inventory

The spare parts inventory consists of many items which are useful for the machinery in case of any
machine breakdown. Major part of this inventory consists of

· Ball bearings
· Belts
· Bushes

Inventory review
The inventory review is made periodically. The period for the review is generally one month.
Evaluation of the company
By studying the organization I come to the result that Firm is the company which is performing
according to the standards. It is producing the finished goods in a qualitative form and meeting the
requirement.

For its workers, it gives them many facilities like high salaries, bonuses, and compensation for any
loss and many more. So all types of staff are quite satisfied which is also a plus point for the company.