BUSINESS PROJECT

STITCHING UNIT

A Business Proposal

Presented to

Miss Muqaddas Zahra

The Department of Management Sciences

University of Jhang

In Partial Fulfillment of the Requirement for the Degree

Bachelor of Business Administration

By
Adnan Manzoor
202048
 BBA (Management Sciences)

A Post Graduate project submitted to the Management Sciences as partial

fulfillment of the requirement for the award of Degree BBA

Name Registration Number

Adnan Manzoor 20-UOJ-771

Supervisor

Name of Supervisor: Miss Muqaddas Zahra

Lecturer Department of Business Administration

University of Jhang

Submission year 2024

 STITCHING UNIT
By

Adnan Manzoor

20-UOJ-771

Has been approved

For the University of Jhang, Jhang.

Examiner:
______________________________________________________________________

Supervisor:
______________________________________________________________________

HOD:
______________________________________________________________________

Dr. Abdul Sami

In charge, Department of Management Sciences, University of Jhang

 CERTIFICATE

It is certified that Adnan Manzoor, 20-UOJ-771 has carried out all the work related to this

Business project under my supervision at the Department of Management Sciences, University

of Jhang and the work fulfills the requirement for award of BBA degree.

Date:

Supervisor:

Miss Muqaddas Zahra

Lecturer University of Jhang
 ACKNOWLEDGEMENT

I would like to express my heartfelt gratitude to all those who have contributed to the successful

completion of this project. First and foremost, I extend my deepest appreciation to my project

supervisor, Miss Muqaddas Zahra, for their unwavering support, guidance, and valuable

insights throughout the entire project. I would like to acknowledge the support and cooperation

received from University of Jhang, as well as the resources and facilities provided, which

have significantly contributed to the successful execution of this project. Last but not least, I

would like to express my deep appreciation to my family and friends for their understanding,

encouragement, and patience throughout this project journey. Their unwavering support has

been a constant source of motivation. Each of the above individual’s contributions has played

a crucial role in shaping this project and enhancing my learning experience. I am truly grateful

for their involvement and support.

 DECLARATION

I, Adnan Manzoor, a student of Bachelor of Business Administration (BBA), hereby declare

that the Project Stitching Unit submitted to University of Jhang, in partial fulfillment of the

requirements for the degree of BBA, is my original work and has not been submitted earlier

either to University of Jhang, or to any other institution for the fulfillment of any course of

study. The project embodies the results of my investigation and analysis under the guidance

and supervision of Miss Muqaddas Zahra. I have acknowledged all sources of information

used in the preparation of this project. I further declare that this project is based on my own

effort, and the information presented is genuine to the best of my knowledge. I take full

responsibility for any mistakes or discrepancies in the project.

Adnan Manzoor

20-UOJ-771

Signature of the student:

Contents
STITCHING UNIT ............................................................................................................................... 1
SNAPSHOT ........................................................................................................................................... 1
MODULE 1............................................................................................................................................ 7
Testing & Evaluating Your Idea........................................................................................................... 7
CONTENT ............................................................................................................................................. 8
Objective ................................................................................................................................................ 8
Business Idea ....................................................................................................................................... 13
Business Model and Description........................................................................................................... 13
Company Summary .............................................................................................................................. 13
We Believe in Quality Providing as Best .............................................................................................. 13
Products/Services features .................................................................................................................... 15
Business Formation............................................................................................................................. 18
Sole Proprietorship: .............................................................................................................................. 18
Partnership: ........................................................................................................................................... 18
Limited Liability Company (LLC) ....................................................................................................... 19
Industry Analysis ................................................................................................................................ 20
Market Overview ................................................................................................................................ 20
Market Description ............................................................................................................................... 20
The Apparel Industry ............................................................................................................................ 21
Customer Analysis............................................................................................................................... 22
Feature of Customer Analytics.............................................................................................................. 22
Value Generation in Fashion Retail Industry ........................................................................................ 22
Customer Segmentation ........................................................................................................................ 22
Competitive Analysis .......................................................................................................................... 23
Sports que Expert .................................................................................................................................. 23
Abercrombie & Fitch ............................................................................................................................ 23
Sons of Yale .......................................................................................................................................... 23
Competitive Advantage ...................................................................................................................... 24
MODULE 2.......................................................................................................................................... 25
MARKETING & SALE PLAN ......................................................................................................... 25
PRODUCTS/SERVICES AND PRICING ........................................................................................ 25
Promotions Strategy ........................................................................................................................... 25
Social media .......................................................................................................................................... 25
Brand Ambassadors .............................................................................................................................. 25
Location ................................................................................................................................................ 26
Pricing ................................................................................................................................................... 26
Target Audience .................................................................................................................................... 26
Branding and Messaging....................................................................................................................... 26
Online Presence .................................................................................................................................... 26
Distribution Plan ................................................................................................................................. 27
Direct Sale............................................................................................................................................. 27
Retail Partnerships ................................................................................................................................ 27
Clothing service Distribution ................................................................................................................ 27
Sales Goals ............................................................................................................................................ 27
Sales Team ............................................................................................................................................ 27
Sales Process ......................................................................................................................................... 28
SALE PLAN ........................................................................................................................................ 28
Marketing and Sales Team .................................................................................................................... 28
Marketing Materials .............................................................................................................................. 28
Sales Tools ............................................................................................................................................ 28
Distribution Networks ........................................................................................................................... 29
Marketing Budget ................................................................................................................................. 29
MODULE 3.......................................................................................................................................... 30
BULDING SYSTIME & PROCESS ................................................................................................. 30
Facility Design and Layout ................................................................................................................... 30
RISK MITIGATING MILESTONES ............................................................................................... 32
Key events (From idea to launch) Strategic ...................................................................................... 32
10-year plan and exit strategies............................................................................................................. 35
Planning Your Exit Strategy .................................................................................................................. 36
7 to 10 Years Before Selling ................................................................................................................. 36
3 to 5 Years Before Selling ................................................................................................................... 36
2 Years Before Selling........................................................................................................................... 37
1 Year Before Selling ............................................................................................................................ 37
DEVELOPING OPERATIONS MANUAL ...................................................................................... 38
Mission, vision and objectives ............................................................................................................ 38
Key performance indicators (KPIs) ...................................................................................................... 39
Factory Efficiency Percentage .............................................................................................................. 39
Man-to-Machine Ratio (MMR): ........................................................................................................... 40
Key assumptions & risks ...................................................................................................................... 42
Capital requirements ............................................................................................................................. 42
Inventory management Policies and procedures ................................................................................... 44
MODULE 4.......................................................................................................................................... 45
TEAM BUILDING ............................................................................................................................. 45
HIRING PLAN.................................................................................................................................... 45
Skillset identification ............................................................................................................................ 45
Identify Job Roles and Responsibilities ................................................................................................ 46
KEY FUNCTIONAL AREAS & TEAM ROLES ............................................................................ 46
List of key functional areas, team roles and responsibilities ........................................................... 46
Develop Job Descriptions ..................................................................................................................... 48
MANAGING TEAM GAPS ............................................................................................................... 48
Future hiring checklists & skills shortage ........................................................................................ 48
Skills Assessment .................................................................................................................................. 48
Training and Development.................................................................................................................... 48
Hiring and Recruitment......................................................................................................................... 49
DEVELOP YOUR MASTERMIND GROUP .................................................................................. 49
Identify Potential Members................................................................................................................... 49
Set Clear Objectives .............................................................................................................................. 49
Establish Group Guidelines .................................................................................................................. 49
Facilitate Effective Meetings ................................................................................................................ 49
Foster Open Communication and Trust ................................................................................................ 50
HR Development ................................................................................................................................. 50
Recruitment and Selection .................................................................................................................... 50
Training and Development.................................................................................................................... 50
Performance Management .................................................................................................................... 50
Employee Engagement and Motivation ................................................................................................ 50
Succession Planning.............................................................................................................................. 51
COMPENSATION PLAN .................................................................................................................. 51
Employee compensation strategies ....................................................................................................... 51
Job Evaluation and Classification ......................................................................................................... 51
Base Salary............................................................................................................................................ 51
Performance-Based Incentives .............................................................................................................. 51
Benefits and Perks................................................................................................................................. 52
MODULE 5.......................................................................................................................................... 52
FINANCE & FINANCING ................................................................................................................ 52
STARTUP CAPITAL .......................................................................................................................... 52
List of assets/equipment/resources required ......................................................................................... 52
ACCOUNTING SYSTEM ................................................................................................................. 56
Income statement .................................................................................................................................. 56
Chart of Accounts ................................................................................................................................. 56
Bookkeeping ......................................................................................................................................... 56
Financial Statement ............................................................................................................................... 57
Budgeting and Forecasting ................................................................................................................... 57
Inventory Management ......................................................................................................................... 57
THE ULTIMATE FINANCIAL PLAN ............................................................................................. 57
Financial goals ...................................................................................................................................... 57
Start-up Costs and Capital Investment .................................................................................................. 58
Revenue Projections.............................................................................................................................. 58
Expense Analysis .................................................................................................................................. 58
Cash Flow Management ....................................................................................................................... 58
BALANCE SHEET ............................................................................................................................. 58
INCOME STATEMENT .................................................................................................................... 60
 STITCHING UNIT

SNAPSHOT
The Project

The proposed project is designed as a small-scale garment manufacturing unit. Readymade

garment industry has occupied a unique place in the industrial scenario of our country by
generating substantial export earnings and creating lot of employment. The employment
provided by it is a source of livelihood for millions of people. It also provides maximum
employment with minimum capital investment. This project report is prepared for the
manufacture of Ladies garments, gent’s shirts and gent’s trousers as they find wide acceptance
in local and international markets.

Objectives

• To alleviate poverty in the locality.

• Upliftment of the rural population.

• Job opportunity for the disabled.

• To manufacture garments based on consumer demand.

• To establish a revenue generating unit.

• To provide high quality products at competitive rates.

• To achieve customer satisfaction.

• On the Job training in designing garments.

• Employment for rural women.

Scope

Poverty is particularly widespread in the rural areas of our country. According to government
unemployment in this region stands around 40%, over 60% of the working age population is
“not economically active”. As a result, household incomes are very low, producing dire

1
shortfalls in nutrition, education, housing, access to health care and the overall quality of life.
The project aims at removing poverty among local women households and upliftment of the
disabled by improving their living levels through the setting up of garment manufacturing unit.
The demand for readymade and designer garments is increasing due to its cost effectiveness
and timesaving. Numerous industrial, educational, commercial, service and financial
institutions are located around the outskirts of the rural locality. There are a great number of
garment shops, functioning in the town and nearby places and this unit can sell their products
through these shops also.

Unemployment Rate

2
Manufacturing Process

Different types of materials like cotton, silk, georgette, jute, cotton silk, polyester etc can be
obtained from cheapest places through bargaining keeping in mind the current trend of the
industry. The quality of garments mainly depends on quality of fabric used. Therefore, care
must be taken while purchasing fabrics to ensure good colourfastness properties, uniformity
in shade etc. Generally, garments are made as per customer's specification in respect of size,
design and fashion. The manufacturing process includes designing, cutting and stitching the
material based on standard size or customer demand.

3
INNOVATION

• Robotics in fabric testing

• Robotics in printing
• Robotics in the sewing process
• Robotics in the cutting process
• Robotics in the assembly process

SWOT ANALYSIS

STRENGTHS

• Quality of textile, fabric and production.

• Automation of production processes.
• Industrial training.

WEAKNESSES

• High price because of rapid changes.

• The bad covering of foreign market.
• Condition and price of raw materials.

OPPORTUNITIES

• Making e-mail catalog.

• Consumers’ wish for new designs.
• Production of garments Made-to-Measure.

THREATS

• Quick obsolesce of technology.

• Competitors have lower price.
• Competitors have better distribution network.

Expenses Machinery / Equipment’s/Furniture

• Machine Needle 1500/-
• Threads 2000/-

4
 • Scissors, Accessories 3000/-
• Bobbins 1500/-
• Sewing Machine 200000/- (40000 x 5)
• Over lock stitching Machine 30000/-
• Iron Box 2500/-
• Measuring Tape 500/-
• Embroidery Machine 50000/-
• Ruler 500/-
• Chalk 250/-
• Cutting table 10000/-
• Ironing table 5000/-
Total 307000/-

Working Capital (Per Month)

• Production Manager 50000/-

• Cutting Master 30000/-
• Tailors 80000/- (20000 x 4)
• Designer 30000/-
• Store-Keeper 25000/-

Raw Materials

• Fabrics 50000/-
• Trims, Embellishments 20000/-
• Packing Materials 6000/-

Utilities (Per Month)

• Electricity 15000/-
• Water Charges 5000/-
• Stationary 3000/-

Promotional Expense 10000/-

Pre-Operative expenses 20000/-

5
Travelling Expense 4000/-

___________________________________________

Total 6,55,250/-

Major Challenges for Apparel Industry

• Raw Material Issue

• Inventory Management Issue
• Production Delay
• Garment Defects
• Digitalization

Expected Outcome

• The project can become the lifeline to many of the poor families in the rural areas.
• Resultantly the morale, confidence and capacity level of the rural people can
become very high, and the status of the rural family and the community can be
improved.
• The empowerment of women can become the beacon light to their children, their
families and to the society at large.
• Increased income levels for the poor.
• Increasing the quality of life of the rural women who are beneficiaries of this
project.

6
MODULE 1
Testing & Evaluating Your Idea

• Conduct a market research survey: Before you launch your stitching unit, it's
important to gauge consumer interest in your products. You could design a survey to
ask potential customers about their clothing consumption habits, preferences, and
willingness to pay for your products. This information will help you identify your target
market and refine your product offerings.

• Hold a focus group: Another way to get feedback on your clothing products is to host
a focus group. Invite a group of consumers to sample your products and provide their
thoughts and opinions. You can ask questions about the design, texture, packaging, and
branding of your products to gain insight into how consumers perceive your brand.

• Offer free samples: To get your garment products in the head of potential customers,
consider offering free samples. You can give free sample in market or clothing store
and hand out samples of your products. This will allow people to try your products and
give you feedback on what they like and don't like.

• Monitor social media: Keep an eye on social media to see what people are saying
about your products. You can set up alerts for mentions of your brand and products and
respond to any feedback you receive. This will show customers that you care about their
opinions and are committed to providing high-quality products.

• Track sales and revenue: Finally, track your sales and revenue to see how your
business is performing. You can use this data to identify which products are most
popular, which marketing campaigns are most effective, and which areas of your
business need improvement.

7
CONTENT
Objective

• Assess Viability: Determine the feasibility and potential success of your clothing
business idea in the market. Identify any strengths, weaknesses, opportunities, or threats
associated with the idea.

• Refine Product Offering: Gather feedback on your clothing products to improve their
quality, and appeal. Understand customer preferences and make necessary adjustments
to meet market demands.

• Validate Market Demand: Determine if there is a sufficient demand for your clothing
products. Evaluate consumer interest, willingness to pay, and purchasing behaviour to
ensure there is a viable market for your business.

• Identify Competitive Advantage: Assess the competitive landscape and identify

unique selling points that differentiate your dairy business from existing competitors.
Determine how your products can stand out and attract customers.

• Optimize Pricing and Profitability: Evaluate production costs and market factors to
establish competitive pricing for your dairy products. Ensure that your pricing strategy
allows for profitability while remaining attractive to customers.

Overall, the objective is to gather relevant information, insights, and feedback to make
informed decisions, refine your clothing business idea, and increase its chances of success in
the market.

Executive Summary:

• Overview of the clothing business concept.

• Mission statement and business objectives.
• Summary of key financial projections.

8
Business Description:

• Detailed explanation of the clothing concept and its unique selling points.
• Overview of the target market and customer demographics.
• Analysis of the competitive landscape and market opportunities.
• Description of the legal structure and ownership of the business.

Product Offering:

• Types of clothing products to be manufacturing (T-shirt, Hoodies, Tracksuit, Jacket,

etc.).
• Quality standards for Clothing production and processing. Packaging and labelling
details for the clothing products. Value-added products or unique offerings.

9
Stitching unit Operations:

10
Market Analysis:

• Overview of the dairy industry, including market size, trends, and growth potential.
• Analysis of the target market's demand for dairy products. Identification of target
customers, such as local consumers, retailers, or foodservice establishments.
• Competitive analysis, including other dairy farms and existing dairy product suppliers.

Marketing and Sales Strategy:

• Branding strategy for the stitching unit, including logo, name, and positioning.
• Marketing channels and strategies to reach target customers (e.g., clothing stores,
markets, direct sales, partnerships with retailers).
• Pricing strategy for dairy products, considering production costs, market competition,
and customer preferences.
• Promotional activities, such as online marketing, social media campaigns, and farm
visits.

Financial Projections:

• Start-up costs, including land acquisition, infrastructure, purchase, and equipment.

• Operating expenses, including, labour, machineries, utilities and marketing.
• Sales forecast and revenue projections for the first few years.
• Cash flow projections, breakeven analysis, and return on investment estimation.

Risk Assessment and Mitigation:

• Identification and evaluation of risks related to the clothing business (e.g., fabric
shortage, market fluctuations, regulatory changes).
• Strategies to mitigate risks, such as insurance coverage, fabric, and machineries.
• Compliance with local regulations and permits required for operating a stitching unit.

11
Organizational Structure:

• Description of the management team's experience and responsibilities.

• Staffing requirements, including workers and administrative staff.
• Training and development plans for employees.
• Key external stakeholders and partnerships, such as suppliers or customers.

Conclusion:

• Summary of the key points from the business plan.

• Reiteration of the business goals and objectives.
• Next steps, including securing funding, acquiring resources, and launching the clothing
business.

12
Business Idea

Business Model and Description

The proposed project is designed as a small-scale garment manufacturing unit. Readymade

garment industry has occupied a unique place in the industrial scenario of our country by
generating substantial export earnings and creating lot of employment. The employment
provided by it is a source of livelihood for millions of people. It also provides maximum
employment with minimum capital investment. This project report is prepared for the
manufacture of Ladies garments, gent’s shirts and gent’s trousers as they find wide acceptance
in local and international markets.

Company Summary

Hudson Export is a consumer-driven, design-oriented, and Innovative Company, aiming to

work with the coherence of renowned global brands, organizations, and entrepreneurs.

We Believe in Quality Providing as Best

Strong performance is our core value. Financial success enables continuous development of
our brands and products. The determination to win encourages a strong work ethic and high-
level performance.

We are making all type of Knitted and Woven products of Polyester, Cotton, and Nylon in
same and mix yarn ratio fabrics. We always make the product in functional fabrics i.e. Dry-Fit,
Cool-max, Breathable, Anti-Bacterial, UV-Protection, Wind and Water proof that make the
product comfortable and improve wearer performance.

We have the capability to produce more than 3000 garments daily cut to pack, maintaining all
quality standards. Also, we have 5 Tajima Embroidery machines to fulfill the school wear and
Clubwear embroidery requirements. We are always ambitious to serve our customers with our
height of professionalism and are waiting for their kind response to prove our claim.

13
Strategy

The Hudson Export strategy is to aggressively develop and market a full range collection to
consumers. The company intends to market its line as an alternative to existing clothing lines
and differentiate itself through its marketing strategies, exclusiveness, and brand awareness.
New Look intends to build on its core portfolio of products and overcome any obstacles by
using the company's expertise in the clothing industry.

The company's goal in the next year is to make an overwhelming impact on the fashion industry
and create a large consumer demand for the product. The company's goal in the next 2-5 years
is to venture into women's and children's clothing. It plans to also license a line of cologne and
perfume, bedding, underwear and small leather goods. According to Standard & Poor's
(S&P's), women's apparel accounted for 52% of total apparel sales in 2022.

Strategic Relationships

The company has strategic alliances with Music Records and the Entertainment Group. These
alliances are valuable to Hudson Export because they provide the needed exposure for its line
and the association of its products with celebrities. Celebrities are valuable assets because they
receive free clothing for interviews, concerts, and music videos.

14
Products/Services features

• Casual Wears
• Cycling Wears
• Fitness / Gym Wears
• Sports Uniforms
• Sublimation Wears

15
Services & features

STITCHING

We have a vast range of stitching units fully equipped with state-of-the-art machines automatic,
semi automatic, and manual. This gives us flexibility and speed to produce many types of
garments simultaneously. We have the experienced and technical team in production and
quality which ensure the tailoring art of stitching. That is an important factor of our growth and
customer's satisfaction. We have the unique quality control and quality assurance system,
which ensures the quality and customer's standards at the start of the production, in the sewing
lines and end of lines. Then the garment is supposed to be checked at final stage before packing.

16
EMBROIDERY

We have extensive range of Embroidery Machines giving us the capability to produce many
designs from simplest to the complex and enable us to cope with the quick turnaround on both
small and large volume.

QUALITY CONTROL LAB.

Hudson Export has documented a Quality Manual that states the quality management system,
of the organization. Management establishes a documented quality plan setting out the specific
quality practices, resources required and sequence of activities relevant to particular product.
There are quality checks at every stage of manufacturing starting from Yarn, Fabric,
Processing, Cutting Stitching and Packing. Before is cut, it is checked whether it confirms to
the customer's standard, of shrinkage, GSM, Shade etc. The in-house lab is fully equipped and
computerized. Lab has full capability to perform Colourfastness to Wash, Colourfastness to
Water, Colourfastness to Rubbing, Colourfastness to Perspiration, Dimensional Stability,
Spirality, Fabric Weight, pH value, Bursting Strength, Garment Durability and Print Durability
test standards and working to satisfy our customers regarding all Quality Parameters.
Laboratory is Accredited for customer Next and further developing to achieve the certifications
of some other customers like George, Marks and Spencer.

17
Who is already doing it?
We are in business for over sixteen years and have incessantly been supplying supreme quality
fashionable sportswear products to leading European apparel companies.

We are making all type of Knitted and Woven products of Polyester, Cotton, and Nylon in the
same and mix yarn ratio fabrics. We always make the product in functional fabrics i.e. Dry-Fit,
Cool-max, Breathable, Anti-Bacterial, UV-Protection, Wind and Waterproof that make the
product comfortable and improve wearer performance.

Our product range:

American Football Clothing, Basketball Clothing, Football Clothing, Football Shirts, Handball
Clothing, Cricket Clothing, Rugby Clothing, Volleyball Clothing, Goalkeepers Clothing,
Table-Tennis Clothing, Soft Shell Clothing, Golf Clothing, Fitness Fashion, Running Shirts,
Jogging Suits, Track Suits, Fleece clothing.

Business Formation
Sole Proprietorship:
• A sole proprietorship is the simplest form of business ownership, where the stitching
unit is owned and operated by a single individual.
• The owner has complete control and assumes all legal and financial responsibilities.
• Personal assets are at risk in the event of any liabilities or debts incurred by the business.

Partnership:
• A partnership involves two or more individuals who come together to jointly own and
operate the stitching unit.
• Partners share the profits, losses, and responsibilities of the business based on the terms
outlined in a partnership agreement.
• It is essential to have a well-drafted partnership agreement that outlines the roles,
responsibilities, and decision-making processes among partners.

18
Limited Liability Company (LLC)

• An LLC provides liability protection for its owners (called members) while offering
flexibility in terms of management and taxation.
• Members' personal assets are typically shielded from the business's liabilities.
• The operating agreement defines the management structure and outlines the members'
rights and responsibilities.

Corporation:

• A corporation is a separate legal entity from its owners, known as shareholders.

• Shareholders' personal assets are generally protected from the corporation's liabilities.
• Corporations have a more complex structure and are subject to specific legal and tax
requirements.
• There are two types of corporations: C corporations and S corporations, each with
different tax implications.

Cooperative:

• A cooperative is a business owned and operated by the peoples who use its services or
buy its products.
• Clothing Unit can form a cooperative to collectively market and sell their clothing
products, purchase inputs, or share resources.
• Cooperatives are governed by democratic principles, where each member has a vote
and benefits from the cooperative's activities.

19
Industry Analysis
Market Overview

• Identify the size of the dairy industry, both globally and within your target market.
• Analyse historical and projected market growth rates.
• Understand the regional distribution of dairy farms and production facilities.
• Evaluate market segmentation, including product types (t-shirt, hoodie, jacket etc)

Market Description

Apparel sales are driven by economic conditions, demographic trends, and pricing. Fashion,
while important for an individual company, plays a limited role in overall market demand. Sales
of apparel at the retail level rose approximately 4.7% in 1998, according to NPD Group, Inc.,
a market research firm located in Port Washington, New York.

In 1998, Americans purchased approximately $215 billion of apparel and footwear. According
to NPD Group Inc., approximately $177 billion was spent on clothing in 1998. The remaining
$38 billion was used to purchase more than 1.1 billion pairs of shoes, based on data from
Footwear Market Insights (FMI), a market research firm based in Nashville, TN. With the U.S.
population at 270 million, this works out to roughly $800 a year per capita spent on apparel
and footwear.

The apparel and footwear industries are highly competitive, and both have attempted to lower
manufacturing costs by moving production to such places as Mexico, Central America, and
Asia. As a result, employment levels for U.S. manufacturing industry employees fell to 713,000
in February 1999, according to the Department of Labor. This was down 10% from the year-
earlier level and 52% from 1970. The number of domestic non-rubber footwear employees
declined 15%, year to year, in 1998, and 86% since 1968, according to the Footwear Industries
of America, an industry trade group based in Washington, D.C.

20
The Apparel Industry

The U.S. apparel industry is large, mature, and highly fragmented. Apparel sold in the United
States is produced both domestically and in foreign locations. According to estimates from the
American Apparel Manufacturers Association (AAMA), an industry trade group based in
Arlington, Virginia, the dollar value of domestic apparel production was $39 billion at the
wholesale level in 1997 (latest available), which was less than the $46 billion (U.S. wholesale
value) of goods imported into the United States. In addition, $15 billion of goods were
produced in both the United States and other countries.

The U.S. apparel market can be divided into two tiers: national brands and other apparel.
National brands are produced by approximately 20 sizable companies and currently account
for some 30% of all U.S. wholesale apparel sales. The second tier, accounting for 70% of all
apparel distributed, comprises small brands and store (or private-label) goods.

Apparel is sold at a variety of retail outlets. Based on data from NPD Group, discount stores,
off-price retailers, and factory outlets accounted for 30% of 1998 apparel sales, while specialty
stores and department stores accounted for 22% and 18%, respectively. Another 17% were sold
at major chains, and direct mail/catalog accounted for 6%. The remaining 7% of apparel sales
occurred through other means of distribution.

21
Customer Analysis
Clothing will target the young consumers of New Haven, Connecticut. The store will be geared
towards individuals in middle school, high school, college, and young professionals. Those
young professionals who have children will also be able to shop in the store as it will carry
young children’s clothing.

The boutique store will be located in a retail shopping centre in New Haven, Connecticut where
there are other boutique shops and trendy restaurants and coffee shops. The retail centre is a
hub for all shoppers and is a popular destination for young people to relax, socialize, and shop.

Feature of Customer Analytics

Company’s business goals can define how customer analytics can be incorporated into their
business intelligence. It could be focused on the prediction of customer behaviour at an
individual level without considering any other information, or it could be used by merging
information from different systems to analyse, Orit could be based on behavioural or
longitudinal social network analysis. In other words, it depends on the business goals of the
companies and which problem they are trying to address.

Value Generation in Fashion Retail Industry

Fashion retail industry is complicated, and it is quite difficult to understand the consumer
choices toward the product. We can generate a high business value by identifying consumer
lifetime value which can in turn help the fashion industry to achieve their profit goals. Customer
Lifetime Value (CLV)is the predicted value that businesses will derive from their entire
relationship with their customers.

Customer Segmentation

Hudson Export will primarily target the following customer profiles:

• High school and middle school age consumers looking for the trendiest in latest fashion.
• College age consumers that are looking for trendy clothing at an affordable price.

22
 • Young professionals in search of trendy clothing at an affordable price for themselves
and their children.
While Lisa and Jade recognize that middle and high school students do not have their own
income, they reside with their parents who likely buy them clothing or give them allowance.

Competitive Analysis
Sports que Expert

Sports que Expert is known for providing the latest in fashion at an affordable price globally.
Founded in Sialkot Pakistan in 2017, Sports que Expert continues to dominate the affordable
fashion industry in global markets. As of November 2019, Sports que Expert operates in 7
countries with over 5,0 stores. Sports que Expert suppliers are able to source the material at
competitive costs allowing them to offer their clothing for a fraction of other retail outlets.
While Sports que Expert dominates in price and fashion, they tend to suffer and receive
criticism for the quality of the fabric and stitching. With their strengths in technology,
personnel, and global sourcing, H&M is able to revamp their inventory bi-monthly and offer
the sophisticated technology component of an app and website for marketing.

Abercrombie & Fitch

Abercrombie & Fitch is an American apparel company targeted towards young men, women,
and kids. Founded in 1892 by David Abercrombie and Ezra Fitch, the store has been a staple
among young American teens for over a century. Their clothing line is exclusively casual with
a large selection of jeans, sweaters, shirts, and shorts. A&F is geared towards the all-American
youthful image of modern day. A subsidiary is another popular retailer, Hollister, who sells
budget friendly styles of what you would find at an Abercrombie & Fitch store. Because of
their strong national presence, A&F offers a professionally designed website, email list, app,
and social media accounts that allow them to stay relevant with the trendy young population.

Sons of Yale

Sons of Yale is a local boutique shop located in New Haven, Connecticut catering towards the
preppy youth of the local town. Founded by Yale grads in 2002, Sons of Yale is a 1,400 square
feet boutique retail shop offering trendy styles for teens, college students, and young
professionals indicative of Northeastern U.S. preppy style. Their prices are on the high end and

23
the owners believe that adds to the customer desire. In New Haven, wearing a Sons of Yale
item is an indication that you are part of the upscale and luxury community. Their marketing
approach is simple, they rely heavily on their Instagram and Facebook business accounts and
have a simple website that only includes location, contact information, hours of operation, and
numerous professional photographs. A consumer is unable to purchase any items from their
website.

Competitive Advantage
• Hudson Export Clothing will be able to offer the following advantages over their
competition:
• Hudson Export will pride itself in using high quality material at affordable prices. They
have been able to negotiate with U.S. based suppliers that are able to manufacture their
design concepts at an affordable price.
• Hudson Export will offer several technology advantages, such as a customer profile
assessment kept in a database so that their loyal customers will be notified the minute
one of their Favorite items is available in their size. Lisa and Jade believe that by
offering this level of customer service, they will be able to retain and recruit a steady
customer base.
• Unique and modern designs crafted from the minds of Hudson Export. Most apparel
sold in the store will be from the notebook of Hudson Export. They will carry very few
items that can be purchased from other warehouses. By offering fresh and unique
designs that are on the cutting edge of trendy, young people will be flocking to obtain
a piece of clothing that can’t be found on 1,000’s of other people around the country.

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MODULE 2
MARKETING & SALE PLAN

PRODUCTS/SERVICES AND PRICING

Hudson Export will offer the unique value proposition to its clientele:

• Unique and modern designs only found at Lisa Jade Fine Clothing boutique.

• Customer profile and individualized messaging and communication to its clients.

• Trendy clothing offered at an affordable price to the young people of New Haven, CT.

Promotions Strategy

The promotions strategy for Hudson Export are as follows:

Social media

Hudson Export have become social media experts throughout college and will manage their

social media business accounts themselves. They have become adept at creating inviting posts

and will post their merchandise regularly. They have also already encompassed an Instagram

following of over 13,000 followers just by posting teasers and ‘Coming Soon’ posts.

Brand Ambassadors

Hudson Export will partner with young people in the area who have a social media following

of more than 1,000. As brand ambassadors, Hudson Export will provide these young people a

few items of merchandise to wear. They’ll then post themselves wearing these items and tag

the Hudson Export account so that they gain exposure through all of their followers. These

young people get paid a small amount just by posting a few images of them wearing their

25
clothing. While the brand ambassadors will be paid, they will not be part of the company

payroll.

Location

Hudson Export will be located in an upscale and trendy location in Sialkot, Connecticut that

garners a lot of retail traffic. The area is known as a popular hangout and shopping destination

for consumers of all ages. Their small storefront location will be eye catching and will be

positioned between other popular retail shops and the trendiest restaurants.

Pricing
The pricing of Hudson Export will be moderate and on par with competitors so customers feel

they receive value when purchasing their items.

Target Audience

• Define your target audience based on preferences, and behaviour.

• demographics, Understand their needs, motivations, and communication preferences.

Branding and Messaging

• Develop a compelling brand identity that resonates with your target audience, Craft
clear and consistent messaging that highlights the unique qualities and benefits of your
dairy products.
• Emphasize factors such as quality, freshness, sustainability, and local sourcing.

Online Presence

• Build and maintain a professional website that showcases your dairy farm, products,
and brand story Leverage social media platforms (such as Facebook, Instagram, and
Twitter) to engage with your audience, share updates, and promote your dairy products.
• Consider content marketing strategies such as blog posts, recipes, and educational
content related to dairy products.

26
Distribution Plan
Direct Sale

Set up a store or retail outlet to sell your products directly to customers.

Online Sales

Establish an e-commerce platform or website where customers can place orders for delivery or
pickup.

Retail Partnerships

Local Retailers: Establish partnerships with local stores, supermarkets, or specialty clothing
stores to stock and sell your products.

Local' Markets: Participate in local' markets to directly connect with customers and sell your
products.

Clothing service Distribution

Clothing stores: Develop relationships with clothing brands and other stores establishments
that value locally sourced clothing products.

Sales Goals

• Set specific, measurable, achievable, relevant, and time- bound (SMART) sales goals
for your stitching unit.
• Define both short-term and long-term sales targets based on market analysis, production
capacity, and growth objectives.

Sales Team

• Determine the size and structure of your sales team based on the scale of your stitching
unit and sales objectives.
• Hire or train sales representatives who are knowledgeable about your clothing products
and can effectively communicate with customers.

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Sales Process

Define the step-by-step process that your sales team will follow to acquire customers and close
sales.

• Outline strategies for lead generation, prospecting.

• presenting your dairy products, handling objections, and closing deals.
• Implement a customer relationship management (CRM) system to track leads, manage
customer interactions, and monitor sales progress.

SALE PLAN
Marketing and Sales Team

• Skilled professionals with expertise in marketing, sales, and customer relationship

management.
• Sales representatives who can effectively promote and sell clothing products.
• Marketing specialists who can develop and implement marketing strategies.\

Marketing Materials

• High-quality product brochures, flyers, and promotional materials that highlight the
benefits and unique selling points of your clothing products.
• Packaging designs that are visually appealing and informative.
• Digital assets such as website, social media accounts, and online advertisements.

Sales Tools

• Customer relationship management (CRM) software to manage and track customer

interactions, leads, and sales activities.
• Sales presentations, product samples, and demonstration materials to showcase your
clothing products to potential customers.

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Distribution Networks

• Partnerships with clothing stores, supermarkets and local markets establishments to

distribute and sell your clothing products.
• Relationships with distributors or logistics providers to ensure timely and efficient
delivery of products to customers.

Marketing Budget

Allocation of financial resources to fund marketing and sales activities, including advertising,
promotions, marketing materials, trade shows, and online marketing campaigns.

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MODULE 3
BULDING SYSTIME & PROCESS

Facility Design and Layout

Plant layout is a floor plan for deciding and orchestrating the chosen equipment and machinery
of garment industry in the best suitable location to permit the quicker flow of materials at a
minimum cost and with the least amount of material handling during the manufacturing process
from the receipt of raw materials to the shipment of the finished garments. Plant layout is the
arrangement and configuration of departments, work stations, machinery and equipment used
in the conversion process. A proper plant layout is directly associated with good workflow,
right from material receiving till the finished goods go out of the factory.

Principles of Plant Layout in Garment Industry

The following principles have to be followed to have an ideal plant layout for garment
industry. The understanding of these principles would help in learning the aspects that
are influencing the plant layout in garment industry.

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Principle of Minimum Travel

Workers and materials must pass through the shortest distance between the processes
to avoid wastage of Labor and time and reduce the cost of materials handling. This is
mainly important for garment industries where each department is interconnected and
the movement of the Labor from one department to another must be minimized for
increased productivity.

Principle of Sequence

Machineries as well as processes should be arranged in a sequential order which is

achieved in the product layout. It contains the arrangement of the working area for each
operation in the same order. For a proper flow of materials, the plant layout must offer
easy movement of raw materials to the production department and to the packing
department. The plant layout, following the principle of sequence, needs to consider the
frequency of movement between the different departments, volume of production in
each department, total working area available in each department and the nature of
operations in each department.

Principle of Usage:

Every foot of existing space should be effectively utilized. It includes the proper usage
of space both horizontally and vertically. Apart from using the floor space of a room, if
the ceiling height is also utilized, more material can be stored in the same room. Use of
overhead space saves a lot of floor space.

Principle of Compactness:

There should be harmonious fusion of all the related factors so that the final layout looks
well integrated and compact.

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Principle of Safety and Satisfaction:

This layout has built in options for workers to ensure they are safeguarded from the
occurrence of fire. The comfort and convenience of the worker has been considered
more important while planning this layout. In a garment production unit, factors such
as proper lighting, ventilation and prevention of hazardous conditions are very
important. Employees must be protected from excessive heat, dust from the raw
materials such as fabrics and the trimmings of the threads in sewing, glare and fumes.
The safety of workers both during operation, maintenance and transportation of
materials should be taken care of.

Principle of Flexibility:

The layout must allow modifications with minimum complications and at minimum
cost.

RISK MITIGATING MILESTONES

Key events (From idea to launch) Strategic

Your Target Audience

Defining your target audience gives you direction in your marketing, facilitates more
consistency in your messaging and allows you to authentically connect with your customers.
Get in the mind of your target audience and understand where the best place to reach them is
and how they will interpret your ad.

Know The Problem You’re Solving

Always stay focused on your “who” and “why.” Test it with your personas, talk to them about
it, and know it is something that will fulfill an unmet need first.

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Understand The Buying Journey

The buying process forms the foundation of all marketing and sales activities. You need to
have an intimate understanding of the buyer’s pain points, where they get their information and
who influences the purchase.

Secure Your Online Identity

In today’s world, we have seen numerous cybers quitters try to take advantage of businesses
who do not secure their domain name, trademark, social media accounts, etc. It is critical to
secure all these before launching anywhere.

Validate Your Product

If people won’t buy the product or service based on a pitch, they probably won’t buy the
product or service when it exists. An easy way to do this is to develop a landing page. Run ads.
See if anyone clicks the “Buy Now” button. If so, you’ve got validation.

Know Your Competition and Be Different

We see many “Me Too” brands popping up that want to ride the trend wave and cash in on
others fast-growing successes. Instead of following this knee-jerk reaction, look to what makes
you different. Figure out your brand differentiators and build your story around that. Learn
about the principles of creating unique and effective branding for your startups.

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Lay Out a Comprehensive Strategic Plan

Every brand should have a thorough plan for strategic branding, identity and brand experience
before launching any product. This includes things such as evaluation of the
marketplace/competition, SWOT, determining ROI, how to measure success and
communications planning.

Create Brand Voice Guidelines

After you have established a strong brand, you must create guidelines for the brand’s voice and
tone. Don’t enter the market without knowing who you are and how you want to interact with

34
the world. Consistency is key for a brand, so you want to set the team up for success when it
comes to broadcasting brand messages.

Offer Early Use Incentives

You want to create a buzz around your product before its launch. One of the best ways to do
this is to offer discounts for preorders, free first-time uses, and beta participation rewards that
entice users to buy upon launch. This is awesome product promotion, too. No one expects a
product to be perfect in beta, so test, gather feedback and refine.

Keep Testing It

Launching a new product or service isn’t easy. The one thing every brand should do beforehand
is test it; test it until it breaks and then test it some more. Collecting feedback and insight will
help you get closer to delivering the experience you intended. And of course, you’ve also got
to get all of your marketing materials together, too!

10-year plan and exit strategies

An entrepreneur's dream is to build a successful and profitable business, so to many owners it

might seem illogical to walk away. Using a recent example involving a client, let me illustrate
how it can pay off to sell when things are good.

Health care:

Generally, any business related to health care is drawing a lot of interest, particularly businesses
that cater to health care-related technologies. The obvious reason is the aging baby boomer
generation, which will spike the demand curve like never before. Perhaps of equal significance
is the pursuit to reform and remake our entire health-care system.

Business services:

These include business-to-business operations that offer scale and have a solid infrastructure
in place. In particular, collection agencies and debt-related businesses are doing very well in
this economy.

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Repair services:

In times of economic belt-tightening, consumers and businesses want existing equipment to

last longer. Businesses that repair items such as office equipment and machinery are in demand.

Planning Your Exit Strategy

Selling a business has always been an individual decision, and timing the sale right can be
tricky. It's always best for sellers to plan their exits so they can leave when they want and under
the circumstances they want.

As such, it would be wise to plan an exit strategy even as you launch your business, but most
people can't fathom taking that step just as they are getting started. What follows is a 10-year
timeline to help you plan for the eventual sale of your business.

Let's assume you're thinking of retiring and selling your business when you turn 65. (That
number could be 55 or 75, of course.) This timeline, a rough guide, will help you put the pieces
in place to prepare your business for sale. If you create a plan from day one, most of your time
will be spent running the day-to-day operations of your business so you won't need to scramble
when you're ready. It also helps you better calibrate the best time to sell so you can get top
dollar and achieve your personal goals.

7 to 10 Years Before Selling

This is the education and reading stage. Learn about successful business transitions, attend
seminars on how to sell a business, and talk to retirees who have sold a business. Essentially,
get familiar with the notion of what you'll need to do as the process continues. Take your time;
this phase can last for several years.

3 to 5 Years Before Selling

Start to assemble a team of advisors (accountant, attorney, wealth manager, insurance agent,

36
business broker and exit planner) for the express purpose of designing a plan that will meet
your needs post-sale. These advisors may be different than the people you use to help you
manage your business, and they should be well-versed in business transactions, tax planning
and wealth maximization. An experienced exit planning professional should be retained to
quarterback this process and ensure that all the parties involved are working toward a common
set of objectives and goals. The outcome of this process can range from minor tweaks to your
financial record-keeping and legal structure to significant changes in your business operations
to ensure that you maximize the value of your asset.

2 Years Before Selling

At this stage, you should be revisiting the exit plan every six months to a year to ensure you
are on pace to achieve your goals. If so, you can begin the window dressing necessary to
prepare for a sale. If not, you may have to consider a course correction, modification of your
goals, a delay in your exit or any combination thereof. If things are on track, this is the time to
firm up your vendor and client agreements and ensure key employees are in place and that you
have a complete operations manual that documents all processes and procedures.

1 Year Before Selling

Make sure you can answer this question with clarity: Why are you selling? That will be the
first question every potential buyer will ask. By now you know what your business is worth
and you have prepared all other aspects for a sale. Work with your business brokerage firm to
start developing the "go to market" strategy. Ensure that you have a mix of strategic and
financial acquirers identified, as well as a broad-based marketing plan to attract the largest
number of buyers. Finally, when everything is ready, take a step back. Just focus on managing
the business so it's running smoothly and let your brokerage firm manage the life cycle of the
business transaction. This will lead to a graceful and profitable exit.

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DEVELOPING OPERATIONS MANUAL
Mission, vision and objectives

Mission Statement

We aim to provide the best quality alterations and dry cleaning for everything and everyone.

Sharing Our Values

Our values reflect what is important to both our Associates and customers. We value honesty,
trust, respect, families, teamwork, personal growth, and security.

Living Our Mission

Our mission is to earn our customers’ and co-workers respect, while building self-esteem and
pride for our profession. We want to become the best we can be, both as a company and as
individual Associates, by always doing our best.

Seeing Our Vision

Our vision is to pursue excellence in combination with profitable growth so that The Stitch It
Group of Companies is the leading Clothing Alteration Service in North America. We follow
this vision to benefit our Associates and because of their great work.

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Key performance indicators (KPIs)

Key Performance Indicators (KPIs) are measured to assess where the factory currently stands
and to find key focus areas that management needs to look into. The top 9 KPIs have been
listed and explained below that are measured by garment manufacturers (export houses) in the
apparel industry. Analysis of these KPIs is carried out monthly.

Factory Efficiency Percentage

Factory efficiency indicates how efficiently sewing lines are run in a factory. This indicator is
important because the capacity planning of the factory and projected garment-making cost is
done based on factory efficiency. Factory efficiency includes all line minutes produced and
total hours attended by direct Labor on the sewing floor. Target factory efficiency varies based
on the order quantity.

For factory efficiency – calculate the total minutes produced by all lines and the total minutes
attended by all lines.

Factory efficiency (%) = (Total minutes produced X 100)/Total minutes attended.

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Man-to-Machine Ratio (MMR):

When it is the factory’s Man to Machine ratio (MMR), every employee of the factory is
considered under manpower.

So, Man: Machine= Total manpower: Total sewing machines available in the factory (machines
in use).

For example, if a factory has 500 sewing machines and the total manpower of the factory is
1100 then man to machine ratio = (1100:500) OR 2.2. This ratio varies from product to product
and on organization structure.

Cut to ship ratio:

This is a ratio of the total cut quantity and the total shipped quantity of the order.

This indicator is measured order-wise and monthly shipped orders. To keep buffer (for
damaged, defective garments) factory cuts extra pieces than the order quantity.

For example, the factory received an order of 20000 pieces, cut quantity of 20200 pieces (1%
extra cutting), and a total shipped quantity of 20000 pieces.

Cut: Ship = 20200:20000 = 1.01.

This indicator is measured to control surplus quantity after shipment, and reduction in extra
cutting, and damaged garments.

Target Cut to ship ratio is 1.

Order to ship ratio

The buyer expects to receive full quantity from the supplier that has been ordered. This is the
most important factor that buyer uses for vendor evaluation. This indicator is calculated as =
Total order quality/ Total shipped quantity. The target of Order to Ship ratio is always 1. It is
good if the factory can ship higher than order quantity (only if the buyer accepts extra
quantity).

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On-time delivery rate

How many shipments that did not meet the target shipment date are analysed at the end of each
month?

The target on-time delivery of each style is to meet the shipment delivery date. If not met, what
are the reasons for failing the delivery dates are analysed.

It is calculated as = (Total orders shipped on time/Total orders shipped in the month).

For example, if a factory shipped 18 styles on time out of 20 styles shipped in a month, then
on-time delivery of that month is = (18/20) *100% = 90%

Average style change over time

The time gap between the previous style (the last piece out from the line) and the first piece
output of the current style is known as style change over time (COT). A shorter changeover
time is considered a better performance level. It varies from style to style and production
systems. The time of Change over time of each style is recorded the average changeover time
of the factory is measured.

Right First Time (RFT) quality

This indicator is represented in percentages. Total audits passed for the first time out of total
audits conducted by auditors. Right first-time quality is measured in various stages of garment
processing and analysis is done audit-wise. Higher values (percentage) of right-first-time
quality are considered as better performance of the factory.

Quality of production:

The quality level of each department is measured in DHU and the Percentage of defective units.
Higher the value of DHU higher alteration time and higher cost incurred in quality.

41
Key assumptions & risks

Capital requirements
Expenses Machinery / Equipment’s/Furniture

• Machine Needle -1500/-

• Threads -2000/-
• Scissors, Accessories -3000/-
• Bobbins -1500/-
• Sewing Machine -200000/- (40000 x 5)
• Over lock stitching Machine -30000/-
• Iron Box -2500/-
• Measuring Tape -500/-
• Embroidery Machine -50000/-
• Ruler -500/-
• Chalk -250/-
• Cutting table -10000/-
• Ironing table -5000/-
_______________________________________
Total 307000/-

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Working Capital (Per Month)

• Production Manager -50000/-

• Cutting Master -30000/-
• Tailors -80000/- (20000 x 4)
• Designer -30000/-
• Store-Keeper -25000/-

Raw Materials

• Fabrics -50000/-
• Trims, Embellishments -20000/-
• Packing Materials -6000/-

Utilities (Per Month)

• Electricity -15000/-
• Water Charges -5000/-
• Stationary -3000/-

Promotional Expense -10000/-

Pre-Operative expenses -20000/-

Travelling Expense -4000/-

______________________________________________

Total -655,250/-

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Inventory management Policies and procedures

44
MODULE 4

TEAM BUILDING

Foster Collaboration and Cooperation:

• Encourage team members to work together and collaborate effectively.

• Promote a sense of unity and shared goals among the team.

Enhance Communication:

• Improve communication channels within the team, enabling better information sharing
and understanding.
• Ensure that all team members are informed and involved in stitching operations.

Develop Trust and Mutual Respect:

• Cultivate a positive and supportive work environment where team members trust and
respect one another.
• Build relationships based on open and honest communication

Improve Problem-solving and Decision-making:

• Enhance the team's ability to identify and address challenges effectively.

• Encourage active participation in problem-solving and decision-making processes.

HIRING PLAN

Skillset identification
• Determine the necessary qualifications, skills, and experience for each job role. This
may include knowledge of fabric, cutting, stitching techniques, and management,
machinery operation, and general stitching maintenance.
• Identify any specific certifications or licenses required, ssh as a stitching unit
management certificate or all clothing packing technician qualification.

45
Identify Job Roles and Responsibilities

Determine the specific job roles needed on the stitching unit, such as herd manager, milking
technician, stitching manager, cutting, and general clothing workers.

Clearly define the responsibilities and requirements for each role based on the size and scope
of the stitching unit.

KEY FUNCTIONAL AREAS & TEAM ROLES

List of key functional areas, team roles and responsibilities

Style Analysis

The line supervisor analyses the garment construction of the style to be loaded to the line. He
calculates the machine requirement for the style, based on the garment construction.

Estimating labour costs

Line supervisors calculate the estimated cost per operation. In the piece-rate-production
system, the supervisor sets piece rates for stitching operations. Those factories that have
industrial engineering departments calculate direct labour costs based on the standard allowed
minutes (SAM) to produce a garment.

Planning and scheduling floor level production

The floor in-charge and line supervisors plan the daily production output. They take
information on upcoming orders from merchandisers or the planning department and plan
manpower and machine requirements in advance.

Setting the line:

Line supervisors set the sewing line for new orders. Line setting involves the tasks of placing
sewing in a sequence, by allocating operators to each machine, giving work to operators and
helpers and giving instructions to operators on how to undertake operations and the required
stitching quality.

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Stitching garments

The sewing department stitches garments and makes clothes. Operators sew garments using
different types of sewing machines. An operator can be given single or multiple operations to
sew.
Balancing the assembly line

To get maximum production from the line, line supervisors balance line by adding additional
operator, or by clubbing operations.

Marking parts

Marking is done on the garment component needed to point a position from where the stitching
is to be done. Helpers mark on garment parts as per process requirement by using marking
chalk and magic marker.

Ironing garment components

Garment components might need to be folded and ironed prior to stitching to improve seam
quality. Portable irons are used for ironing on garment parts.

Checking stitched garments:

Garments are checked in line and off the line. The purpose of checking garments is to reduce
defect generation from the line. The end-of-line checker segregates defective pieces from the
good pieces. Read quality checking procedures in garment production.

Stitching alteration

After segregation, defective garments are sent back to the stitching section. Seams are repaired
by re-stitching. If defects are related to the fabric, part changing is done by replacing the
defective component with the correct part.

Managing documentation

The department maintains various logbooks and records. The sewing department records the
details of receiving cuttings from the cutting department and issuing garments to the finishing
department. They make reports of the daily production on a line-wise basis and the manpower
used in each line.

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Recruiting operators

In most factories, line supervisors are responsible for bringing sewing operators and recruiting
operators through skill assessment tests.

Develop Job Descriptions

• Create detailed job descriptions for each position, outlining the responsibilities,
qualifications, and desired skills.
• Include information about work hours, physical demands, and any additional
expectations or requirements.

MANAGING TEAM GAPS

Future hiring checklists & skills shortage

Skills Assessment

• Conduct a comprehensive skills assessment of the existing team members to identify

any gaps or areas of improvement.
• Assess the skills required for each functional area and compare them to the skills
possessed by the current team members.

Training and Development

• Provide targeted training programs to enhance the skills and knowledge of team
members in specific areas where gaps have been identified.
• Offer training opportunities on topics such as clothe cutting and printing techniques,
stitching management, equipment operation, and stitching unit management.

48
Hiring and Recruitment

• Determine whether the team gaps can be filled by hiring new employees with the
necessary skills and expertise.
• Develop job descriptions and qualifications that align with the specific skills needed for
the identified gaps. Advertise job openings through appropriate channels and conduct
thorough interviews and assessments to select the most suitable candidates.

DEVELOP YOUR MASTERMIND GROUP

Identify Potential Members

• Look for individuals who have relevant experience and knowledge in stitching unit,
preferably from diverse backgrounds to bring different perspectives.
• Seek out people who are committed, passionate, and have a growth mindset.

Set Clear Objectives

• Define the purpose and objectives of the mastermind group, such as sharing best
practices, problem-solving, professional development, and mutual support.
• Establish the frequency and format of group meetings, whether in person or virtual.

Establish Group Guidelines

Develop a set of guidelines that outline the expectations, values, and confidentiality
requirements of the mastermind group.

Facilitate Effective Meetings

• Design an agenda for each meeting that allows members to share challenges, successes,
and insights.
• Rotate the role of facilitator among the group members to ensure everyone has an
opportunity to lead and contribute.

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Foster Open Communication and Trust

Encourage open and honest communication within the group, creating a safe space for
members to share their experiences and concerns.

HR Development
Recruitment and Selection

• Develop effective recruitment processes to attract qualified candidates with relevant

skills and experience. Utilize various recruitment channels, including online job portals,
industry associations, and agricultural colleges.
• Implement a thorough selection process, including interviews, assessments, and
reference checks, to ensure the right fit for the stitching unit.

Training and Development

• Provide training programs to enhance the skills and knowledge of employees in areas
such as stitching or cutting techniques and unit management.
• Offer opportunities for professional development through workshops, seminars, and
certifications to keep the team updated with industry best practices.

Performance Management

• Establish a performance management system that includes regular performance

evaluations, goal setting, and feedback sessions.
• Set clear performance expectations and provide employees with the necessary tools and
resources to succeed.

Employee Engagement and Motivation

• Foster a positive work environment that promotes employee engagement and

motivation.
• Recognize and reward employees for their contributions, achievements, and milestones.

50
 • Implement initiatives such as team-building activities, employee wellness programs,
and communication channels to encourage employee involvement and satisfaction.

Succession Planning

Develop a succession plan to identify potential future leaders within the organization and
ensure a smooth transition when key roles become vacant.

COMPENSATION PLAN
Employee compensation strategies

Job Evaluation and Classification

• Evaluate and classify different job roles within the stitching unit based on their
responsibilities, skills, and qualifications.
• Group similar positions together to create job categories or levels.

Base Salary

• Determine appropriate base salaries for each job category or level, considering factors
such as job complexity, required expertise, and market rates.
• Base salaries should reflect the value of the position and provide a foundation for the
overall compensation package.

Performance-Based Incentives

• Develop performance-based incentives or bonuses tied to individual or team

performance metrics.
• Set clear and measurable Performance targets related to productivity, clothing quality,
or other relevant key performance indicators.

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Benefits and Perks

• Determine a comprehensive benefits package that includes healthcare coverage,

retirement plans, vacation leave, and other employee benefits.
• Consider additional perks or incentives, such as housing or transportation allowances,
employee discounts on farm products, or professional development opportunities.

MODULE 5
FINANCE & FINANCING

STARTUP CAPITAL

List of assets/equipment/resources required

Product designing and pattern making

Garment pattern made prior to garment sample development. The pattern for a style can be
made manually.

For the pattern making of the sample products, you may be interested in software. For this, you
can purchase CAD (computer-aided design). There are other components of the CAD systems
pattern grading, Marker planning, Nesting, Pattern digitization. For printing the marker paper,
you need a plotter machine. With the help of CAD software, you can estimate fabric
requirements accurately and improve the garment fit.

Fabric testing and fabric inspection

In garment manufacturing, fabric plays an important role in garment quality and product
valuation as well as customer demand. Secondly, 60-70 percentage cost incurred in fabrics in
total garment costing. That is why purchasing the right quality fabric for your products is
necessary. For verifying the fabric quality parameter, garment manufacturers prefer to set-up

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in-house fabric testing. You may also like to purchase some basic fabric testing equipment –
like

• Fabric GSM testing machine,

• weighing scale,

• Meter scale,

• Fabric inspection (visual inspection machine).

• Colour cabinet

• Fibre content

• Sample washing machine and Tumble drier

• Fabric handing equipment in the fabric store

Fabric spreading machines

For small-scale garment manufacturing, manual spreading is viable. But if you want to scale
up your business and improve cutting room productivity and reduce cutting room manpower,
automatic spreading machines must be considered. See this post to learn more about automatic
fabric spreading process and auto spreading machines.

Cutting table

You need cutting tables for fabric layering. You need a wide and long table depending on the
marker length and maximum fabric width to be used. A number of fabric layers are spread over
on the flat table and whole plies are cut together as per marker. For check and stripe design
fabric layering where you need to match fabric stripe and checks in the garment, a pin table is
commonly used.

Cutting room machines and equipment

For the garment making fabric sheets need to cut as per patterns. Various types of cutting
machines are available for fabric cutting. for cutting the fabric you can use a straight knife
cutting machine. For cutting few numbers of plies you can use round knife cutting machine
instead of the straight knife cutting machine. For cutting small garment parts a band knife
cutting machine is very helpful.

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Other fabric cutting machine, for the cutting room you may need

• A fusing machine,

• Ply number machine,

• Piping cutting machine (automatic rib cutting machine)

• Racks for storing cutting

• Trolley for moving cutting from bundle section to sewing lines

• Heat transfer printer if your designs have printed labels and logo, you can install the
heat transfer printer and do the printing job in-house. With the technology
advancement, cutting automation is preferred by medium and large-scale garment
manufacturers. Cutting room efficiency is improved by many folds after using
automatic textile fabric cutting machine.

Sewing machines

Sewing machines are the heart of the garment manufacturing factories. Different types of
sewing machines are available for making the garment products. You need to select the right
mix of sewing machines for your products or product groups. For the selection of sewing
machines and the number of sewing machines need to be purchased for setting up your factory,
you can take advice from an expert. Just for your quick reference, a list of sewing machines is
shown below.

• Single Needle Lock Stitch (three different types of SNLS machines are used depending
on the operation. Normal lockstitch machine, with under bed trimmer and equipped
with edge cutter)

• Feed off the Arm

• Single needle chain stitch machine

• Multi-needle chain stitch machine (e.g. Kansai Special)

• Overlock sewing machines

• Flatlock machines – Flatbed and cylinder bed types

• Double-needle lockstitch machine

• Button holing machine

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 • Button Sewing machine

• Zig-zag sewing machine

• Snap button attaching machine

For the garment sewing, there are many automatic and semi-automatic machines are available.
Some of the automatic sewing machines are sewing operation and product specific. Like
trouser back pocket welting machine, Jeans back pocket setter and pocket attachment in back
panels. Logo embroidery machine.

Sewing room equipment (non-sewing machine)

Sewing room equipment includes – material handling systems, sewing machine attachment and
guides, WIP storing crate or bins, and material transportation equipment. See the detailed list
of non-sewing machines and equipment.

Finishing machines and equipment

Finishing room activities involve garment checking, repair defective garment, stain removing,
mending, thread cutting, thread removing, garment pressing and folding the garment. For these
processes, various types of finishing equipment are required. Like, garment pressing equipment
Vacuum table and Steam iron for pressing garments,

• Garment checking tables,

• Spotting gun etc.

• Thread trimmers

• For the garment finishing, various type finishing equipment is there. Like bulk pressing,
tunnel finishing etc.

A complete list of finishing room tools and equipment.

Garment packing

Garment folding is normally done manually. But garment folding template is available in the
market. In the garment packing stage, hangtags must be attached to the garment. For tagging,
you need tag gun machine.

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If you are making kid's garments, one of the compliance parameters, all garments must be
passed under needle detector machines. You may need to buy a needle detector machine.

Office Equipment

Let me also list the equipment required for the office.

• Computer and laptops

• Printers

• Photo copier machine

• If you set up a showroom for displaying your designs, you need racks and hangers and
dress forms. The dress form is all needed in the sampling room and finishing section
for checking the fitting of the garments.

ACCOUNTING SYSTEM

Income statement

Chart of Accounts

• Develop a chart of accounts specific to your stitching unit, categorizing income and
expense accounts, assets, liabilities, and equity accounts.
• Include accounts such as product sale, fabric expenses, shipping expenses, equipment
depreciation, loan payments, and capital investments.

Bookkeeping

Maintain accurate and up-to-date records of all financial transactions related to your stitching
unit.

Record income from product sales, stock sales, and other sources, as well as expenses such as
fabric purchases, equipment maintenance, and labour costs.

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Financial Statement

• Prepare regular financial statements, including the income statement (profit and loss
statement), balance sheet, and cash flow statement.
• Analyse these statements to assess the financial health and performance of your
stitching unit.
• Monitor key financial ratios and indicators to identify areas of improvement or potential
issues.

Budgeting and Forecasting

• Develop a comprehensive budget for your stitching unit, estimating revenues and

expenses for the upcoming period (e.g., annually or quarterly). Regularly compare

actual financial performance to the budget and adjust your plans accordingly.

• Use forecasting techniques to project future cash flows, identify potential funding gaps,

and make informed decisions.

Inventory Management:

• Implement an inventory management system to track inventory, stock counts, and other
product-related supplies.
• Conduct regular inventory reconciliations to ensure accurate reporting and prevent theft
or losses.

THE ULTIMATE FINANCIAL PLAN

Financial goals

• Define your financial goals, such as achieving a certain level of annual revenue,
increasing profitability, or expanding your operations.
• Set specific, mensurable, achievable, relevant, and time-bound (SMART) goals to guide
your financial planning process.

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Start-up Costs and Capital Investment

• Estimate the initial capital required to establish and set up your stitching unit, including
land, infrastructure, stock, equipment, and working capital
• Identify potential sources of funding, such as personal savings, loans, grants, or
partnerships.

Revenue Projections

Forecast your revenue based on factors such as production, product prices, stock sales, and any
other potential income sources (e.g., breeding services, agritourist). Consider market demand,
seasonality, and pricing fluctuations in your projections.

Expense Analysis

• Identify and analyses your expenses, including feed costs, labour, shipping services,
equipment maintenance, utilities, insurance, and administrative expenses.
• Classify expenses as fixed (e.g., loan payments, insurance) or variable (to understand
cost structures and plan accordingly.

Cash Flow Management:

• Develop a cash flow management strategy to ensure sufficient liquidity for day-to-day
operations, payments, and unforeseen expenses.
• Monitor cash DEA inflows and outflows, manage receivables and payables, and
establish contingency plans for cash flow gaps.

Balance Sheet

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 HUDSON EXPORT Balance Sheet
Date: 27/06/2024

Assets 1st Year 2nd Year

Current Assets
Cash $ 10,000.00 $ 20,000.00
Accounts receivable $ 3,000.00 $ 5,000.00
Inventory $ 5,000.00 $ 7,000.00
Prepaid expenses $ 2,000.00 $ 3,000.00
Short-term investments $ 5,000.00
Total current assets $ 20,000.00 $ 40,000.00
Fixed (Long-Term) Assets
Long-term investments $ 1,700.00 $ 2,000.00
Property, plant, and equipment $ 50,000.00 $ 70,000.00
(Less accumulated depreciation) $ -2,200.00 $ -5,000.00
Intangible assets $ 3,000.00 $ 5,000.00
Total fixed assets $ 52,500.00 $ 72,000.00
Other Assets
Deferred income tax $ 1,000.00 $ 3,000.00
Other $ 1,000.00
Total Other Assets $ 1,000.00 $ 4,000.00

Total Assets $ 73,500.00 $ 116,000.00

Liabilities and Owner's Equity

Current Liabilities
Accounts payable $ 8,060.00 $ 10,000.00
Short-term loans $ 3,000.00
Income taxes payable $ 3,145.00 $ 5,000.00
Accrued salaries and wages $ 1,500.00
Unearned revenue $ 3,000.00
Current portion of long-term debt
Total current liabilities $ 11,205.00 $ 22,500.00

Long-Term Liabilities
Long-term debt $ 3,450.00 $ 4,500.00
Deferred income tax $ 1,000.00
Other $ 500.00
Total long-term liabilities $ 3,450.00 $ 6,000.00
Owner's Equity
Owner's investment $ 7,178.00 $ 10,000.00
Retained earnings $ 4,389.00 $ 6,300.00
Other $ 700.00
Total owner's equity $ 11,567.00 $ 17,000.00

Total Liabilities and Owner's Equity $ 26,222.00 $ 45,500.00

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INCOME STATEMENT

HUDSON EXPORT
INCOME STATEMENT OF HUDSON EXPORT
AS OF THREE YEARS ON ESTIMATED DATA
ITEMS 1st year 2nd year 3rd year
Revenue $1,000,000.00 $1,200,000.00 $ 1,500,000.00
Cost of Goods Sold $ 600,000.00 $ 720,000.00 $ 900,000.00
Gross Margin $ 400,000.00 $ 480,000.00 $ 600,000.00
Operating Expenses $ 200,000.00 $ 240,000.00 $ 300,000.00
Net Profit $ 200,000.00 $ 240,000.00 $ 300,000.00
Net Profit Margin (%) 20 20 20
INTERPRETATIONS
1-A 20% Net Profit Margin is generally considered good.
2-It shows the company`s ability to control cost an generate profit from its core activities

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