Internship Report

On

Procurement Process and Inter-departmental Co-ordination

in Supply Chain Management: A study on Pacific Jeans Ltd.

Supervised By:
Dr. Tunazzina Sultana
Chairman and Professor
Department of Marketing
University Of Chittagong

Submitted By:
Umme Hany Arju
ID: 17304009
Session: 2016-2017
Department of Marketing
University of Chittagong

Date of Submission: 30th October, 2022

 30th October, 2022
Dr. Tunazzina Sultana
1 Chairman & Professor
Department of Marketing
University of Chittagong

Subject: Submission of internship report

Dear Mam,
It’s my great pleasure to place my internship report on ‘’Procurement process and
interdepartmental Coordination in Supply Chain Management: A study on Pacific
Jeans Limited’’ for the purpose of partial fulfillment of my Bachelor of Business
Administration (BBA) program at the University of Chittagong with a major in Marketing. It
was a great opportunity for me to work in this prominent company. I highly appreciate the
work environment and cooperation from all the employees during the period. All my
observation, learning and results of the study have been embodied on this report, which has
enabled me to gain insight into the core process of procurement and interdepartmental
coordination. In addition to my careful study, this report has been a worthwhile review
allowing me to go for in-depth analysis about the real situation of procurement process &
practices (an integral part of Supply Chain Management) scenario in Bangladesh RMG
sector. Besides, my 6 week internship had been a great opportunity to enrich my learning
about the corporate culture.
In accordance to your valuable suggestions and guidance, I have tried my best to prepare the
report. I sincerely believe that you will find this report very significant and informative. I
would be always available for answering any query regarding this report.
Thanking You.
Sincerely,

…………………..

Umme Hany Arju

ID- 17304009
Session- 2016-2017
Department of Marketing
University of Chittagong

1
 Acknowledgements
First of all, I would like to express my deepest gratitude to Almighty Allah who enabled me to
2 complete this report within scheduled time.

I would like to express my deepest sense of gratitude to my respected supervisor Dr. Tunazzina
Sultana, Professor and Chairman, Department of Marketing, University of Chittagong from my
core of heart for her Kind support, supervision, instruction and advice that motivated me to put
this report an end properly on time.

I am highly indebted to Mr. Mahbubul Alam, Senior Manager of Supply Chain & Coordination
Department of Pacific Jeans Ltd. for his Cordiality, necessary support, Supervision and
cooperation during my internship period.

I am grateful to the executives of Supply Chain & Coordination Department Mr. Nurul kowsar
(Sr. Executive), Mr. Shorower Jahan (Sr. Executive) , Mr. Saiful Uddin (Sr. Exexcutive), Mr,
Mohiuddin ( Sr. Executive), Mr. Khurshed Alam (Sr. Executive), Mr Tariqul Haider Reyad (
Sr. Executive), Mr. Abu Naeem Shiplu (Sr. Executive), Afkahin Newaz Arnob (Sr. Executive)
Mr. Mahmudur Rahman Himu (Sr. Executive), Mr. Abu Kaiser Roni (Sr. Executive), Mr.
Minhaj Ul Karim (Sr. Execitive), Mr. Forhad Hossain (Sr. Executive), Mr. Ahmed Ullah Khan
(Junior Executive), MR. Ridowanur Islam (Sr Executive), MR. Riaz Morshed (Sr. Executive),
Mr. Ahsanul Hoque Bin Shahjahan (Jr. Execuitive) , Mr. Monzur Quader ( Asst. GM-Import),
Mr. Milton Roy(Sr. Import Executive), Mr. Mohin Uddin (Sr. Manager –Export), Mr. Jasim
Uddin (Deputy Manager-Export) and Mr. Ashis Kumar Saha (Sr. Merchandiser), Mr. Ashraful
Alam Chowdhury( Jr. Executive –MCD) others in Pacific Jeans Ltd. for sharing their valuable
time & knowledge, direct supervision and continuous mentorship during this study.

Finally, I want to express my gratitude to everyone who has assisted me directly or indirectly
without whom support it would not be possible to complete my report in the allotted time.

2
 Supervisor Declaration

This is to certify that the business report title ‘’ Procurement Process and Interdepartmental
Co-ordination in Supply Chain Management: A Study on Pacific Jeans Ltd.’’ is performed
by Umme Hany Arju, ID No: 17304009, student of BBA program offered by Department of
Marketing, Faculty of Business Administration, University of Chittagong under my
supervision.

It is mentioned here with that the procurement process and interdepartmental co-ordination of
pacific jeans Ltd. is the preliminary causal research one and initiative stage. The report finding
is genuinely analyzed through collecting primary and secondary data properly .Cordially
thanks to intern student to conduct his job perfectly and encourage him to sustain her work
continuously.

This is further stated that this report has not been submitted elsewhere for any publication or
any degree.

………………..

Dr. Tunazzina Sultana

Professor & Chairman
Department of Marketing
University Of Chittagong
Gmail: [email protected]

3
4

Student’s Declaration

I hereby declare that the report work submitted here was performed by me. This
report contains no material which has been accepted and/or submitted for the
award of other degree to any other institution. Moreover, to the best of my
knowledge, the project contains no material previously published or written by
any other process except where specific references are made.

……………..

Umme Hany Arju

ID: 17304009
Session: 2016-2017
BBA, 25th Batch
Department of Marketing
University Of Chittagong
Gmail: [email protected]

4
 Executive Summary
5

This report is on Procurement process and interdepartmental co-operation of Pacific Jeans Ltd.
This report will provide the learners a complete idea about procurement activities of 100%
export oriented RMG sector of Bangladesh especially of Pacific Jeans Ltd. which is one of the
prominent garment industry in Bangladesh.

This Report is divided into seven sections.

Chapter One covers introduction which consists of objective (Specific & Broad),
Methodology, Scope and limitations of this study. The main objective of the study is to know
about procurement process and interdepartmental coordination of Pacific Jeans Ltd. In this
report both primary & secondary sources of data have been used.

Chapter Two covers Company overview. This chapter is on Pacific jeans Ltd.’s introduction,
Historical background, Mission, Vision, values, objectives, corporate profile, top products,
training & development, certificate, awards, business model, solar plant, buyer based year
export information, yearly turnover.

Chapter Three covers theoretical aspects and knowledge of Supply Chain management ,
objectives , process, intra business supply chain network , procurement, procurement in supply
chain management , objectives and process, importance of digitalized procurement practices ,
negotiation of price in procurement inter-departmental coordination, importance of
interdepartmental coordination , how to improve interdepartmental coordination.

Chapter Four covers practical experience and knowledge on management team & their job
responsibility, the overall procurement work procedure, Types, function, Objective, some
specific types products & buyer wise procurement process, Supply Chain register, STEP form,
Application of Oracle software, SOP, Bonded area facility and interdepartmental coordination
( Accounts, Audit, MCD, Commercial, User Department) of Supply Chain & Co-ordination
Department of Pacific Jeans Ltd.

Chapter Five covers positive and negative findings of Supply Chain & Coordination
Department, Plausible recommendations and conclusion.

Chapter Six covers Learning from Internship in detail.

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 Table of Contents
Page
Chapter Name Chapter Contents No.
6
1.1 Introduction
1.2 Objective
1.2.2 Broad objective
1. Introduction 1.2.2 Specific Objective 8-11
1.3 Method of Study
1.3.1 Primary sources of data
1.3.2 Secondary Sources of data
1.4 Scope of the study
1.5 Limitation
2.1 Introduction
2.2 Historical Background of Pacific Jeans Ltd.
2.3 Pacific Jeans Ltd.- Corporate Profile
2. Pacific jeans 2.4 Vision, Mission , Values and objectives
Limited: 2.5 Top Product of Pacific Jeans Ltd.
Company 2.6 Business Model
Overview 2.7 Major Buyer of the Company
2.8 National Awards 12-23
2.9 Certificates
2.10 Training & Development
2.11 Solar power Plant
2.12 Pacific Attires Limited
3.1 Supply Chain Management (SCM)
3.1.1 Definition of Supply Chain
3.1.2 Supply Chain Management
3.1.3 Objectives & benefits of SCM
3.1.4 Intra Business Supply Chain Network
3.1.5 Strategic Forces Of SCM
3.2 Procurement 24-41
3. Theoretical 3.2.1 Definition of procurement
aspects of 3.2.2 Objectives of procurement
Supply Chain 3.2.3 Types of procurement
Management 3.2.4 Procurement Process
3.2.5 Stages of procurement
3.2.6 Price Negotiation in procurement
3.2.7 Reasons why business needs to digitize their
Procurement management process
3.2.8 Procurement Best Practices
3.2.9 Procurement challenges that haunt business
of all sizes
3.3 Inter-departmental Co-ordination
3.3.1 Inter-departmental co-ordination for Supply
Chain Performance

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 3.3.2 Importance of inter-departmental
collaboration
3.3.3 Ways to improve Collaboration between
Departments

4.1 Supply Chain & Co-ordination Department: An

7 overview
4.2 Management Team Hierarchy
4.3 Objectives
4.4 ERP System
4.5 Work Procedure
4.6 Procurement Types & processes
4.6.1 Local Procurement Process
4. Supply Chain & 4.6.2 foreign Procurement Process 43-69
Co-ordination 4.7 Intra-departmental Supply Chain Network
Department 4.7.1 User Department
4.7.2 Material Control Department
4.7.3 Accounts Department
4.7.4 Audit Department
4.7.5 Commercial Department
4.8 Some specific products & buyer wise procurement
process
4.8.1 Chemical Items
4.8.2 Project based work
4.8.3 Subcontracted Work
4.8.4 Buyer wise procurement ( accessories)
4.9 Supply Chain Register (Saving statement)
4.10 Success Through effective performance ( STEP)

5. Findings, 5.1 Negative findings

Recommendatio 5.2 Recommendations 71-76
ns and 5.3 Conclusion
Conclusion
6.1 Learning from internship
6. Learning From 78-80
Internship
7. References 81

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8

Chapter 1: Report Introduction

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 1.1 Introduction:
9 Bangladesh regained global position as the SECOND LARGEST RMG EXPORTER.
Latest Export Promotion Bureau (EPB) statistics show Bangladesh’s apparel exports surged
30.30% to $ 23.99 billion from July to January 2021-2022. RMG (Ready-made Garments)
sector of Bangladesh has raised as the biggest earner of foreign currency. This sector creates
about 4.2 million employment opportunities and contributes significantly to the GDP. RMG
of Bangladesh is powered by young, urbanizing, workers, where most of them are women.
Effective Supply Chain Management (SCM) is the core for the operational smooth and
sustainable development of this sector. Whatever the wages level or lead time (the period
from order confirmation to shipment) without proper management of supply chain, business
is not viable and sustainable.one single and very simple issue like mismatching thread count
or delayed information can make the whole process jeopardies.
Supply Chain Management is a comprehensive branch of the business world. Procurement is
one of the core operational tasks of this concept.
Procurement offers the inputs needed for a business to run day-to-day operations. It is the act
of obtaining goods/ services to use in further process of a manufacturing plant, where
activities related to placing of purchase order ( PO) , ensuring the order confirmation and
follow up the order until the on time material receiving.
Pacific Jeans Ltd. is a renowned manufacturing company in the world which deals with the
highest number of direct ( acquiring raw materials and goods for production) indirect &
service (purchasing services or supplies required to keep the day to day business operation)
procurement from endemic and overseas. Working at Supply Chain & Co-ordination
department of this prominent organization is a great opportunity to learn and gain practical
experiences about strategic procurement process. This report has been made in order to
understand how the procurement process in pacific Jeans Ltd. is availing on overall Supply
Chain Management.

1.2Objectives:
1.2.1 Broad objective
This report is mainly prepared to get an on-the- field experience about the procurement and
sourcing operations and interdepartmental coordination of RMG sector of Bangladesh taking
the case of Pacific Jeans Ltd.
1.2.2 Specific Objectives

 To learn about the procurement process of Pacific Jeans Ltd.

 To show strategic operational flow of procurement process of pacific jeans ltd.

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  To demonstrate the co-ordination & collaboration system with others interrelated
department such as User Department, Audit Department, Material Control Department
(MCD), Commercial Department, Merchandising department and so on.
 To find out problems, limitations and difficulties facing this department during
procurement and coordination.
 To recommend some suggestions to surpass these problems.
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1.3 Method of the Study
To complete and make this report pertinent both primary and secondary sources of data have
been used.

1.3.1 Primary sources of data

 Observation & informal person to person discussion with the responsible officials of
Supply Chain & Co-ordination Department of Pacific Jeans Ltd.
 Practical experience gained from different assignments & practices various bill entry
and processing at ORACLE (e-business suite) during internship period.
 Practical knowledge gathered through working in the company.
 Observations & studied numerous files and documents provided by the officials
during intern.
 Log-book, which I have maintained throughout the period to note down daily
learnings.

1.3.2 Secondary sources of data

 Various documents, printed materials, files, financial report & articles of the
department.
 Previous internship report.
 Annual and monthly report.
 Company’s website- https://www.pacificjeans.com/
 Standard operating procedure (SOP) of this department.

All the sources were used to draw a sound conclusion about the practice of procurement
process & interdepartmental Coordination of Pacific Jeans Ltd.

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 1.4 Scope of the study

11  The Supply Chain & Co-ordination Department of Pacific Jeans Ltd. deals with only
the procurement activities for all the sister concerns. It rarely fulfills the other
functions of overall supply chain management. So, the scope of this study is
concerned with the procurement process of this department along with systematic
operational co-ordination activities, organization’s background, culture, general
performance combining practical knowledge and secondary information.

1.5 Limitations:
Though the 6 weeks were not enough to experience the entire operational process step by
step, I tried my best to gather as much as knowledge to demonstrate an effectual outcome.
Throughout the intern journey, I have faced the following restrictions and difficulties:

 The study was limited to only one entity (procurement) of Supply Chain Management
which was not possible to cover the scenario of overall Supply Chain Management
Process and also to only one organization, Pacific Jeans Ltd.
 The allocated 6 weeks were not sufficient enough to get involved in the vast and
complex procurement process of supply chain activities of Pacific Jeans Ltd.
 The Supply Chain & Co-ordination Department cannot independently take the final
decisions for procuring some general materials. It needs to depend on Audit, Risk &
Assurance (ARAD) Department for most of the purchase decision. This is why my
report may not reflect the ultimate decision making process of Supply Chain
Department.
 Making a report involves a great deal of theoretical & practical experience but my
slighter knowledge about supply chain and no previous field experience were one of
the imperfection to go for in depth analysis in this short time.
 Due to some official barriers, I could not able to work deeply with MCD,
Commercial, Audit, Accounts Department, Merchandising Department which are
fundamental parts of intra business Supply Chain Management.

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12

Chapter 2: Pacific Jeans Ltd.-Company Overview

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 2.1 Introduction
Pacific jeans Limited is a world class causal wear manufacturing company known for its state
of the art production facility, extensive and unique research and development center and high
13 skilled human resources. At present, Pacific Jeans Limited is one of the premium jeans
manufacturers exporting to over 50 countries. With continuous focus on quality improvement
and value addition, adoption of updated denim processing technology, commitment towards
maintaining safe and healthy workplace for the workers and strict adherence to customers’
compliance requirements, this group has become one of the most preferred suppliers of the
leading global fashion retailers. Pacific jeans Ltd. ships over 36 million pairs of jeans pant
yearly where its export growth rate is in the range of 15% to 20% and it is now contributing
about 12% of the entire value of Bangladesh’s jeans garments exports.

2.2 Historical Background of Pacific Jeans Limited

The history of Pacific Jeans Group started in 1984 with the hand of Mr. Md. Nasir Uddin,
Visionary Founder Chairman and Managing Director of Pacific Jeans Group with the
establishment of “The NZN Fashions” at Iqbal Road, Patharghata, Chittagong.
At the time of the commencement, just 500 people were employed. Exports were barely one
and a half million dollars in the first fiscal year. When there was no denim laundry in the
nation, the plant began producing jeans for an Italian brand the next year. The manufacturer
used to manufacture the jeans and send them to Italy unwashed. In 1986, Mr. Md. Nasir
Uddin launched Bangladesh's first denim laundry. Mr. Nasir Uddin founded Pacific Jeans
Limited in Chittagong Export Processing Zone in 1994, engaging 1,500 employees. Pacific
Jeans Limited has evolved from a small apparel firm formed in 1984 to a peerless institution
for premium jeans. Since then, the company has grown steadily. In 1998 Pacific Accessories
Ltd. was established. In 2000, the group built another facility, Jeans 2000 Ltd. In 2008, the
group expanded with Universal Jeans Ltd. The company partnered with Marriott International
in 2013 to build a 5-star premium business hotel in Chattogram and NHT Holdings Ltd was
established. In 2014, the group’s another addition was NHT Fashion Ltd.
New fire safety and building safety regulations, as well as social compliance and product
safety, challenged the country's clothing sector in 2014 for which Pacific Jeans also had to
abide by the rules. In 2019, it established Pacific Jeans Casual Limited which will make
active KNIT wear, which would help the company broaden its product offerings from denim.
Latest edition of the company is Pacific Knitex Ltd. which will produce fabric that will be a
great advancement in backward integration of the supply chain. Pacific Jeans Limited has
seven manufacturing units employing more than 36,000 people. The company's yearly export
revenue is about $450 million. Pacific Jeans has established a 12-to-15 percent annual growth
goal. Pacific Jeans has focused on unorthodox Asian markets such as China, Japan, Thailand,
Malaysia, and Singapore in the last decade, exporting items to the United States and over 20
nations in Europe. These markets have room for value addition, and are also attempting to
reach Brazil, Argentina, South Africa, and Russia according to the Managing Director Mr.

13
 Syed Mohammad Tanvir. The top management takes good care of their employees by
allowing them to participate in decision-making gives them a sense of ownership. Rather than
adopting a corporate model that offers a variety of products to clients, they aim to concentrate
in one particular product and continue advancing up the value chain. The company's young
14
managing director is on a mission to become a worldwide leader in premium jeans
manufacture by focusing on quality consistency. He believes that diversifying the company's
portfolio is necessary, but that it should not distract their time and attention away from their
current operations. However, it is also an opportunity for the sector, since compliance with
the requirements might secure a sustainable and long-term existence. Young entrepreneurs
should not set out to get wealthy overnight by using unethical methods.
The factories of Pacific Jeans Group are producing about 1,30,000 pieces of jeans pant every
day that will accumulate about 36 million pieces of jeans in a fiscal year. It is situated at
Chittagong EPZ, Bangladesh. Mr. Nasir Uddin, Founder Chairman and Managing Director of
Pacific Jeans are behind this gigantic task. His eldest son, Syed Mohammad Tanvir is now
going to accompany him wisely. His latent talent and ability are developing day by day under
the shade of his prominent father’s. As a result, he was selected as the youngest CIP in 2011
among all in the country. Recently, considering their grand contributions to the country’s
national export, Prime Minister Sheikh Hasina honored both of them and handed over two
gold and two silver trophies.
Once upon a time buyer would like to visit Bangladesh only for cheap denim items. The
situation has changed much. Now Pacific Jeans Ltd. is capable of producing several kinds of
jeans items from the middle to premium quality. Retail price of Pacific Jeans items are about
$50 to $150. Pacific jeans are unique than many other denim factories considering their
performance. The company has a separate individual department named “Pacific Jeans
Innovation Center.” A bunch of designers is always busy there to generate new design. About
60 skilled foreigners are working in this Innovation Centre. According to company data,
usually buyers chose about 65 to 70 percent from this innovated design.
BEPZA is EPZ regulatory authority, and they are very pleased with Pacific Jeans as a
domestic firm who are making competition with many other foreign companies. Whenever
any local or foreign guest wishes to visit CEPZ factories, CEPZ authority must bring them to
Pacific Jeans factory to watch their activities.

2.3 Pacific Jeans Limited- Corporate Profile

Company Name Pacific Jeans Limited ( PJL)
Address Plot # 9-19, Sector #5, Chittagong Export Processing Zone
(CEPZ) Chittagong
Website www.pacificjeans.com
Date of establishment 5th August, 1994
Date of Commercial 26th November, 1994
Production
Category of the Company “C” type ( 100% Bangladeshi investment, Bonded area)
Name of the Owner Md. Nasir Uddin
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 Board of directors Managing Director
Mr. Syed Mohammad Tanvir
Director
Mr. Syed Mohammmad Tahmir
Mr. Syed Mohammad Tansir
Chairman
Mrs. Umme Habiba Begum
15 Sister Concerns Companies 1. Pacific Jeans Limited ( 1,2)
(Total Business Unit-15) 2. Universal Jeans Limited ( 1,2,4)
3. Jeans 2000 Ltd.
4. NHT Fashions Ltd.
5. NHT holdings Ltd.
6. Pacific Accessories Ltd.
7. Pacific Causal Ltd. (1,2)
8. Pacific Knitex Ltd.
9. Pacific WorkWears Ltd.
10. NHT Engineering Ltd.
11. Pacific Attires Ltd.
12. Pacific Reality Management

Export Destination Japan, Europe, USA and over 40 Countries

Total manpower 36000

Production capacity Approximately 1,30,000 pcs Per Day, 130 million per year
Bank associated with  HSBC
 Dutch Bangla Bank ( Worker)
 Bank Asia ( Jr. Management)
 Standard Chartered Bank ( Sr. Management)
 City Bank NA
Competitors All manufactures from Sri Lanka, Cambodia, China, Vietnam,
India and all local competitors producing denim as well as knit.
Departments of the Company  Accounts & Finance
 ICT Department
 Material Control Department (MCD)
 Audit & Risk Assurance Department (ARAD)
 Quality Assurance Department (QAD)
 HR & Admin Department
 Sample, Design and Development Department
 Commercial Department (Export, Import and
C&F)
 Supply Chain & Coordination Department
 Industrial Engineering Department
 Merchandising Department
 Research & Development Department
 Production Department (Cutting, Finishing
,Sewing)
 Engineering Department (Civil, Mechanical &
Electrical)

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  Management Accounts Department
 Wet Processing Plant
 Production and Accounting Department (PAD)
 Transport Department
 Real Estate Department
 Central Production & Planning Department
 Security Department
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 Sustainability & Compliance Department
Process involved in Design, Cutting, Sewing, Washing, Finishing
production
Working hours Worker & staff -8.00 A.M.-4.30 P.M.
Management (Unit) - 8.00 A.M. to 4.30 P.M.
Management ( Corporate) – 9.00 A.M. to 6 P.M.
Workers Council  Workers’ Representative Welfare Council ( WRWC)
Workers Absenteeism & labor Monthly absenteeism 6.08%
turnover rate Labor turnover 5-7%
Worker’s insurance scheme Insurance Scheme
Expenditure on Training 2-4%
Security measures  Fire extinguisher ( fire alarm & sprinkler)
 Two way entry
 PA system
 Evacuation
 Preventive mask & hand gloves
 Fire Fighters demonstration every month
 Temperature Measurement system
 Disinfection process
Publication  Vision of Change
 Alokitho Agami

2.4 Vision, Mission, Objectives and Values

• Be a Global Life Wear Solution Company
• Hits the billion by 2028
•

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 Values: the company places a strong focus on the following values and continuously makes
effort to establish them at all levels of personnel.

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Innovation
 We believe in continuous improvement
 We challenge the status quo.
 We focus on finding solutions.
 We accept change is inevitable and that adaptability determines future success.
 We celebrate and reward creativity.
Speed:
 We move fast, fast is better than slow.
 We have a “can do” (positive attitude).
 We drive for result
 We act with sense of urgency.
 We work drive for result.
 We act efficiently.
 We believe in productivity.
Quality:
 Quality for us means total customer satisfaction
 Quality is the responsibility of every employee of Pacific Jeans Group.
 We do well, what we do.
 We hold ourselves accountable for result.
 For us quality is a journey to excellence, not a destination.
 We take pride in our work.
Integrity:
 We act with honesty, commitment and ethics
 We do the right things in right way
 We assure compliance with laws, rules and regulations
 We show respect and value for all individuals for their diverse background,
experience, style, approach and ideas.
 We assure proper use of company’s assets
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 Sustainability:
 We are responsible employer. We provide a dynamic and supportive working
18 environment.
 We run our business successfully, that satisfies the needs of our customers, our
shareholders and our employees.
 We believe in sustainable profitability & growth.
 We strive to minimize negative impact on the environment.
 We follow sustainable, safe and environment friendly production method.

Objectives:
 To ensure 100% delivery in just time.
 To ensure 100% product quality at first time.
 To maintain 100% commitment.
 To ensure 100% utilization of wealth and resources.
 To ensure 100% transference.
 To ensure 100% honesty, discipline, and sincerity.
 Using the most modern technology in RMG sector to the best possible extends.
 Developing a team of human resources with the most modern business philosophy, practice
and technology.
 To use the potentiality of garments industries & low-cost advantage in a best possible way.
 To create new jobs.

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 2.5 Main products that are manufactured by Pacific Jeans Ltd. are as
follows
Long & short pant
Three quarter
Length trousers
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Long & short skirt
Denim dress
Joggers
Kids Pant
Ladies overall
Jacket
T-shirt
Readymade Concrete Mix
Hotel (Service & Hospitability)

2.6 Business Model:

Pacific Jeans follows a simple but effective work procedure. It has its own unique method
and technology to complete each task. –
Design: Pacific Jeans has in house design and innovation center and R&D. This department
attends denim fairs, prepare fabric maps and select high fabrics, source new chemicals and do
workshops with chemical suppliers. SOURCING PROCESS OF PACIFIC JEANS 18 –
Cutting: Pacific Jeans uses high technology in cutting such as GERBER/LECTRA. It has
auto spreader and auto cutter technology that can produce 1,30,000 pcs/day.
Sewing: Fully automated sewing solution to ensure highest quality & efficiency. It also has
specialized lines for different product category.
Dry Process: this is as much an art, it is a technique to create the distinctive character of
jeans based on a customer’s individuality. Pacific Jeans has capability and capacity to execute
details on dry process with highly skilled workers & latest technology.
Wet Process: Pacific Jeans has the best wet process machine in the Asia. It requires less
water and manual work. It has 1,30,000 pcs per day capacity.
Finishing: 100% quality inspection in different stage with a factory AQL1. It also ensures
proper condition process to avoid moisture.

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 2.7 Major buyers of the company
Pacific Jeans works with top fashion brands in the world. Pacific Jeans Ltd., one of
20 Bangladesh's greatest denim exporters, partners with the majority of the world's top fashion
shops in the United States, the United Kingdom, and Japan. PJL is constantly expanding its
market in Central and South America, as well as Turkey, China, Hong Kong, South Korea,
Taiwan, Malaysia, Singapore, Thailand, and India. In the recent years there have been some
development of new buyers such as AEO, S. OLIVER, ENGELBERT STRAUSS, OLD NAVY,
J CREW, KOHL’S, MUSTANG, TESCO, TOM TAILOR, M&S, LPP, ASOS AND RIVER
ISLANd

2.9 National Awards

Pacific Jeans Limited has received various honors for their exceptional contributions to
Bangladesh's economic sectors. They have been voted Bangladesh's top exporters for the
previous five years. In 2006, the company's chairman was named Bangladesh's finest
businessman of the year. The following are the awards that Pacific Jeans Limited has won:
 National Trophy Silver (1999-2000)
 National Trophy Gold (2000-2001
 National Trophy Silver (2001-2002)
 National Trophy Gold (2003-2004)
 HSBC Excellence Award (2010 and 2012)
 Bangladesh Business Award (2006)
 National Export Trophy (2010-2011)
 National Export Trophy (2014-15)
 Standard Chartered Trade Award

2.10 Certifications & Awards

Pacific jeans has achieved many certificates for manufacturing high quality products and
creating environment friendly workplace. Some of these are:
 Business Social Compliance Initiative (BSCI)
 Worldwide Responsible Accredited Production (WRAP
 The Global Organic Textile Standard (GOTS)
 ISO 9001:2008
 Organic Content Standard (OCS) Blended
 Organic Content Standard (OCS) 100
 Supplier Ethical Data Exchange (SEDEX)
 LEED (Leadership in Energy and Environmental Design

20
 2.11 Training & Development
Pacific Jeans runs training & development program regularly such as:
 Conducting international standard training programs through renowned
organization like BV and other expertise.
 Technical trainings on new technologies in different production process
21  Training session with different sections regarding technical requirements of
buyers
 Motivational/Awareness training for co-workers to get well educated about their
benefits, rules & responsibilities as well as compliance requirements of our valued
buyers

Pacific Jeans Foundation

Pacific Jeans Foundation is the CSR wing of the group relentlessly working on children
education in Bangladesh. The foundation has already established high and primary schools,
Madrasa, orphanage in remote areas of Bangladesh. It is also giving scholarship to 700 talented
students for higher education. It provides all financial support for four colleges. It helps
underprivileged people with free medical treatments and medicines. The foundation is also a
financial patron of an organization that provides assistance to leukemia- affected children. It
also has Medical service agreement with Chittagong Medical College Hospital and Anderkillah
General Hospital

2.13 Solar Power Plant

A rooftop solar power plant with automatic cleaning system with a capacity of 3.5mw per day
has been installed at Universal Jeans Ltd, a concern of Pacific Jeans at the Chattogram EPZ, at
a cost of $0.5 million as part of its green energy initiative. Bangladesh Export Processing Zones
Authority (BEPZA) Executive Chairman Major General Abul Kalam Mohammad Ziaur
Rahman inaugurated the plant on Monday. "We have used grid tie inverter to use the solar
generation instantly without any storage media. The system is fully automated and will
consume solar generated energy first and then consume additional demand of electricity from
other sources," Pacific Jeans authorities said in a presentation. This 3.5mw electricity will meet
10% of the total power demand in the factory. Electricity which will be generated in this plant
will save energy worth Tk10 lakh a month.

2.14 Pacific Attires

Pacific Attires Limited is going to set up a high quality garment manufacturing plant in CEPZ.
The company will invest 3.75 million US dollars in it. As a result, employment opportunities
for 4,994 Bangladeshi Citizens will be created. It will produce 18.72 million pieces of formal
suits, coats, casual wear annually. This 25th October on Tuesday, Mr. Syed Mohammad Tanvir,
MD of Pacific Jeans Limited, signed an agreement on behalf of their respective organization
at BEPZA office.

21
22

Chapter 3: Procurement Process & Interdepartmental Co-

ordination in Supply Chain Management

22
 3.1 Supply Chain
A supply chain is the network of all the individuals, organizations, resources, activities and
technology involved in the creation and sale of a product. A supply chain encompasses
23 everything from the delivery of source materials from the supplier to the manufacturer
through to its eventual delivery to the end user. The supply chain segment involved with
getting the finished product from the manufacturer to the consumer is known as
the distribution channel. Supply chains aim to meet customer demands.
Supply chains are managed by supply chain managers, who monitor lead time and coordinate
the processes in each step to maximize customer satisfaction.

3.1.1 Supply Chain management

Supply chain management (SCM) is the oversight of materials, information and finances as
they move in a process from supplier to manufacturer to wholesaler to retailer and then to the
consumer. The three main flows of the supply chain are the product flow, the information
flow and the finances flow. These occur across three main stages: strategy, planning and
operation. SCM involves coordinating and integrating these flows both within and among
companies. Its objective is to fulfil customer demand through efficient resources. SCM aims
for flexibility. A Well managed supply chain provides flexible planning and better control
mechanism. SCM aims to ensure improved distribution.

Figure: Supply Chain Management

3.1.2 The main objectives and benefits of supply chain management are as
follow:

Better collaboration
By streamlining the Supply Chain process flow, businesses can improve communication and
coordination among all stakeholders. It helps organizations to better collaborate with their
suppliers and customers. It, in turn, leads to increased efficiency and reduced costs.

23
 Improved quality control
A vital part of any business is quality control. It's essential to ensure that products are
manufactured to spec and meet customer requirements.
A good Supply Chain Management process is essential for ensuring the quality of products
24 and services. By improving the quality control at each stage of the Supply Chain process,
businesses can minimize the chances of defective products reaching customers.

Higher efficiency rate

The main goal of a Supply Chain Management process is to improve the efficiency of the
Supply Chain process so that businesses can deliver goods and services to customers as
quickly and as cheaply as possible. Companies can achieve this goal by improving the flow
of information and goods through the Supply Chain process and optimizing each stage's
performance in the process.

Keeping up with demand

Perhaps the most profitable benefit is that it allows businesses to keep up with demand. By
having a well-organized Supply Chain process, companies can quickly respond to changes in
demand and avoid stock-outs. It enables enterprises to meet customer needs and maintain a
competitive edge.

Shipping optimization
A robust Supply Chain process helps businesses answer questions such as what type of
transportation to use, what kind of packaging is needed, and how best to store the product or
service.

Improved risk mitigation

Supply Chain Management processes can help businesses mitigate risks, improve efficiency
and optimize costs. By understanding the different parts of the Supply Chain process and how
they work together, businesses can better identify risks and opportunities for improvement.

Lowered Costs
By coordinating and managing all parts of the Supply Chain process, businesses can reduce
waste and inefficiencies. It results in lower costs for raw materials, transportation, and labour.

Increased Revenue
A company can save money on production costs and increase its profits by streamlining the
Supply Chain process and making it more efficient.

Asset Utilization
Asset utilization is one of the key benefits of the Supply Chain Management process. By
optimizing the utilization of assets throughout the Supply Chain, businesses can improve
their overall efficiency and productivity.

24
 3.1.3 Intra business Supply Chain Network and process:
An intra-business Supply Chain operation starts from planning for demand and following up
customer satisfaction. In between, it has to go through the following activities:
25

Demand
Planning
Demand
Justification
CRM

Customers Sourcing of
material

Sellers Procurement

Inbound
Distribution
logistics

Outbound logistics
Matterial Control

Production Warehousing
Support

Figure: Intra Business Supply Chain Network

These are the stages of Supply Chain Management. Each stage is essential to the success of
the Supply Chain and the overall business.

25
 • Demand Planning It means figuring out what goods or services need to be produced
and what quantities. It also involves deciding how these products will be acquired or
manufactured, and where they will be delivered.
• Demand Justification Checking whether the raised demand is required or not right
26
now.
• Sourcing of material the process of acquiring the necessary raw materials and
components for producing the desired products. It includes sourcing of new supplier,
in & out sourcing, global sourcing, strategic sourcing, joint sourcing
• Procurement The purchase of essential raw, materials, components, and items is the
emphasis of this procedure. RFQ, comparison of price, foreign procurement,
approval, on the in full material delivery, alternative supplier line, negotiation,
purchase order
• Inbound Logistics brings supplies or materials into a business.
• Material Control a management activity that administers how the inventory
employed in the production process is procured, acquired, handled and utilized. It
includes warehousing ,inventory management
 Warehousing is the process of storing physical inventory for sale or distribution.
 Production Support It is the step for turning raw materials into finished products.
 Out-bound logistics deals with moving goods and products out to customers
 Distribution It is the process of getting products to customers, whether through
retailers or direct to consumers.
 Customer Relationship Management The final stage of the Supply Chain is taking
care of the customer. It includes dealing with any problems, complaints, or returns,
and ensuring that the customer is happy with the product and the overall experience. It
is often referred to as reverse logistics in the Supply Chain Management process.

3.1.4 Strategic Forces of Supply Chain Management

Members of the Supply Chain Research Group at the University of Tennessee (Mentzer,
Willam) for successful Supply Chain Management, & James (2011) examine five strategic
forces. They are-
 Integration: The supply chain strategy should be connected with the marketing,
manufacturing, and financial plans of the company.
 Business Environment: Threats and Opportunities must be identified in the supply chain
(with particular reference to suppliers and customers).
 Technology: It enables access and control, preventing suppliers from becoming rivals.
 Information Systems: The need to communicate with customers and suppliers in a timely,
accurate, and cost-effective manner (e.g. electronic data interchange).
 Value chain: The firm should guarantee that the value chain in which it operates is
competitive (e.g. careful management of flows of function.

26
 3.2 Procurement
Procurement is purchasing of material/service which must be related to use in further process of
a manufacturing plant which involves placing order, ensuring the order confirmation and follow-
up the order until the on time material receiving.
27

3.2.1 Procurement in Supply Chain Management

Procurement exists as a branch within supply chain management - it all boils down to getting
goods to buyer. Procurement supports your business functions by offering the inputs you need to
run day-to-day. Whereas Supply chain management deals with how those inputs are transformed
into finished goods and delivered to your customers. Procurement covers one aspect of supply
chain management. Procurement includes sourcing, obtaining and paying for goods and
services. Supply chain management also covers the logistics involved in obtaining goods,
such as shipping and warehouse management, as well as transforming the procured good into
products and distributing them to customers. So, it can be said that, the purchasing process is
an integral part of Supply Chain Management because it helps ensure that the company has
the necessary materials and supplies to meet customer demand.

3.2.2 The objectives of procurement

 Cost Effectiveness Establishing cost effectiveness is undeniably the prime objective of

procurement management. A strong process working with cost effective measures goes long
way. This way the business is able to produce more with less investment and make more profit
at the end of the day.

27
  Efficient Operation Conduction A procurement process is a compilation of several different
processes working in the same direction to meet an end goal. The objective of procurement
management is to ensure all these processes run swiftly committing as few errors as possible.
28
 Delivering Value Procurement management works with an objective to meet the goals of the
business while running a hampered operation process. The management delivers value to the
organization, to the employees, to the laborers, to the supplier, and to the final customer.
 Responsible Sourcing Who is the supplier? Where is the supplier delivering the supply from?
How is it produced? Is it violating any human rights? Is it exploiting any human or an
organization? Is it coming from unethical sources? Is it harming nature in any way? There are a
lot of questions that come with when sourcing a supply. Procurement management ensures the
sourcing is done in the most ethical way. The management runs a background check on the
supplier and the sources of the supply to ensure no violating practices are being conducted
through the process.
 Meeting Organization Goals Ethically An organization is built with a lot of goals.
Procurement management makes sure all these goals are fulfilled. Procurement management
also ensures all the processes basically sourcing are being operated ethically.

3.2.5 Types of Procurement

We can define procurement categories from two point of view. these are:

28
 Generally Three types Regional Basis

29

Direct procurement is the process of

acquiring products & services for Local procurement refers to the
core business activity. such as: purchase of goods and services from
fabric, button, sewing machine. domestic suppliers

Indirect Procurement deals with

acquiring Products & services that Foreign Procurement aims at
support a business operation. purchasing foreign goods with
such as: generator, spare parts comparative advantage over domestic
goods, inviting foreign bidders.

Service Procurrement is the

process for requisitioning
people-based services at an
enterprise-level with an agreed-
upon scope and
delivrables.such as contractor.

Figure: Types of procurement

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 3.2.6 Procurement Process

Procurement processes vary greatly depending on each company’s structure and needs, but
30
generally include the following nine core steps:

Figure: Procurement process

1.Identify which goods and services the company needs. First, a business must identify its
requirements for a specific item or a service. This may be a new item that the company hasn’t
previously purchased, a restock of existing goods or a subscription renewal. This step
typically involves delving into the nitty-gritty details of what the business needs, such as the
precise technical specifications, materials, part numbers or service characteristics. At this

30
 stage, it’s a good idea to consult all business departments affected by the purchasing decision
to ensure the procured items accurately reflect the needs of each department.

31
2. Submit purchase request. When an employee or business group needs to procure a
significant quantity of new supplies or services, they make a formal purchase request (also
known as a purchase requisition. A purchase request notifies the company that a need exists,
usually via department managers, purchasing staff or the financial team, as well as
specifications such as price, time frame needed, quantity and other important things for the
purchasing team to keep in mind. The department overseeing the purchase can then approve
or deny the purchase request. If approved, the procurement team can proceed with selecting a
vendor and making the purchase.

3. Assess and select vendors. With a clear list of requirements and an approved purchase
request, now is the time to find the best vendor and submit a request for quote (RFQ) – this is
what the purchasing team sends to potential suppliers in order to receive a quote – it is
important to be as detailed as possible so you can compare apples to apples. Vendor
assessment should focus not only on cost but also on reputation, speed, quality and reliability.
Many companies consider ethics and social responsibility as well, since procurement is often
intertwined with corporate identity. A retailer that prides itself on sustainability would stand
to benefit from partnering with environmentally responsible suppliers, for instance.

4. Negotiate price and terms. A common best practice is to get at least three quotes from
suppliers before making a decision. Examine each quote carefully and negotiate where
possible. If you need to walk away from a deal, be sure that you have concrete alternative
options. Once you’ve agreed on final terms, be sure to get them in writing.

5. Create a purchase order. Fill out a purchase order (PO) and send it to the supplier. The
PO should be sufficiently detailed to identify the exact services or goods needed and to
enable the supplier to fill the order.

6. Receive and inspect the delivered goods. Carefully examine deliveries for any errors or
damage. Make sure everything is delivered as specified in the PO and that the quality meets
or exceeds expectations.

7. Conduct three-way matching. Accounts payable should conduct three-way matching by

comparing the purchase order, order receipt or packing list and invoice. The goal is to ensure

31
 the goods or services received match the purchase order and to prevent payment for
unauthorized or inaccurate invoices. Highlight any discrepancies between the three
documents and resolve issues before arranging payment.
32

8. Approve the invoice and arrange payment. If the three-way match is accurate, approve
and pay the invoice. Businesses should strive to have a consistent invoice payment process
through accounts payable that checks that payments match the invoice amount and due date.
A standardized process can help make sure invoices are always paid on time, which can
prevent late fees and build good relationships with suppliers.

9. Recordkeeping. It’s important to maintain records for the entire procurement process,
from purchase requests to price negotiations, invoices, receipts and everything in between.
These records may be useful for multiple reasons. They help the company reorder goods at
the right price in the future, as well as assist with auditing processes and calculating taxes.
Clear, accurate records can also help resolve any potential disputes.

3.2.8 Price Negotiation in Procurement

Price negotiation is the process of agreeing on one or more objects of exchange between
at least two parties. Particularly in the industrial goods sector, price negotiations are often a
fixed upstream component of the conclusion of a contract. In principle, price negotiations can
relate to all elements of a transaction, such as payment terms, delivery conditions or
financing. The most important element of a price negotiation is the preparation of the
negotiation, according to the motto” good preparation is half the battle”. Of central
importance here is the so-called BATNA (Best Alternative to a Negotiated Agreement), i.e.
the best available alternative of all parties .Within price negotiations, win-win situations, also
known as integrative potential, must be identified. The negotiating power of the individual
parties plays a central role in the outcome of the price negotiations. Bargaining power is
determined by factors such as size, creditworthiness, reputation, market power or purchase
volume.

Negotiating on price
 Some price negotiating techniques will be familiar if you've ever bartered at a market.
Never accept the first offer - make a low counter-offer in return. The other party is
likely to come back with a revised figure. Always ask what else they can include at
the given price.
 If the price is suspiciously low, ask yourself why. Are the goods of sufficiently high
quality? Do they really offer value for money? What will after-sales service be like?

32
  You can also try to make the asking price look high by exposing any ongoing costs.
Ask about repair costs, consumables and other expenses. If the current state of the
supplier's market means prices are falling, point this out.
 If the price includes features you don't need, try to lower it by asking to remove those
features from the deal.
 Use your bargaining power to get a good deal. For example, if you're a big customer
of the supplier, you could ask for bulk discounts.
33  But remember that if you squeeze the price too low - perhaps by threatening to walk
away from the negotiations - you may end up getting a poor deal. The supplier may
have to cut costs elsewhere - in an area such as customer service, which could prove
costly to you in the long run.

Even if you are a supplier's main customer and enjoy most of the bargaining power, forcing it
to meet prices at which it could go out of business won't protect your reputation as a highly
valued customer. The supplier will soon look for other customers and is likely to feel
resentful.

3.2.10 Reasons why Businesses Need to Digitize Their Procurement

Management Process
The digitized procurement process takes control over everything from incorporating the types of
inventory to auditing the invoice generated by suppliers. With digitized procurement, process
management turns into an automated process. This means automatic tracking of inventory, supply,
invoicing, procurement performance, supplier performance, and varied different aspects.

Reasons to Digitize Procurement Management

Figure: Digitalizing Procurement process

1. Cost Implementing Improvisation Digitizing the process allows the tools to design a
requirement and work with the least cost implementing process for inventory.

33
 2. Elimination of Extra Expenditure Manual operations can at times misjudge the
expenditure. A separate flow of cost could be flowing out from the business that does not
add much value. An automated digitized procurement management system will be able to
analyze and eliminate it.
3. Managing Less Production Time and Cost Digitized procurement management is able
to assess and analyze each process. The analysis draws a result. This helps the procurement
team to understand how less time and cost can be used in production. This indirectly
34 impacts the profit margin for a business as well.
4. Better Spend Visibility Digitized procurement management assorts everything
automatically. The statistics and the records are made and placed in an easily accessible
way. This makes it convenient to clearly see spends. The procurement management team
can therefore get clear visibility on the spending flow from the budget. They can then
increase and decrease spend where ever required.
5. Higher Efficiency Digitizing the procurement process eliminates the manual labor in a lot
of departments. The process is clearly defined and measures are well expressed. This makes
the understanding of the process extremely simple. This makes the entire process easy to
understand and adapt to. Ending it with higher efficiency induced in each step.
6. Reduction in Errors Manually doing a task, a calculation, or an analysis has the potential
for errors. However, a digitized management system is automated and does not require a lot
of manual work. This helps the process to run with minimum errors.

3.2.11 Procurement best practices

The procurement best practices are concerned with obtaining the required goods and services
from appropriate suppliers to enable the institution to meet its strategic objectives in an
economic, efficient and effective manner. These practices vary company to company wise.
Some of these are as follow:
Active support from top management Companies that develop best practices often have top
executives who recognize the potential value that lies in their supply chains, and actively
support (and fund) supply management efforts. At a minimum, CEOs and other high-ranking
executives must have a full understanding of supply value, good relations with their peers at
strategic supplier companies, and they must provide the corporate investment needed to
develop best practices
Deep understanding of cost drivers It is a sad fact that most companies aren’t even close to
having a good handle on what their actual costs are and what causes them. Companies that
have developed best practices nearly always know in detail all elements of their cost
structures and take actions to drive costs lower all the time. They also continuously collect
and analyze data and other information on the costs of the suppliers that comprise their
supply base.
Green Purchasing Green procurement is the practice of purchasing environmentally
preferable products and services, which have a lesser or reduced effect on human health and
the environment when compared with competing products and services that serve the same
purposes. It contains recycled content, minimize waste, consumer energy or water and reduce
the amount of toxins disposed of or consumed. Leading companies that decide to go along
with green procurement activities are experiencing the following benefits.

34
  Value creation: risk management, eco-friendly, strong supplier relationships, and
improvements in environmental performance.
 Economic Benefits: Reducing supplier generated wastes and surpluses can allow
companies decrease handling expenses and risk associated with waste disposal.
 Efficient Production: Through suppliers’ use of cleaner technologies, process innovation
and waste reduction.
 Public Image: By adopting green procurement company can build reputation among
35
stakeholders.
Cooperative supplier relations leading companies realize that suppliers offer value that is
not present in their own companies. These companies integrate strategic suppliers into
programs that involve supply, such as new product development, cost reduction, and logistics
operations. They also understand that suppliers must achieve profit margins sufficient for
them to meet their own business plans and to invest in new technologies, facilities,
equipment, and talented people.
Culture of continuous improvement Companies that have achieved best practices in
procurement do not stand idle and admire their accomplishments. At all levels, they seek to
learn from others and to continuously advance their practices and processes.
Cross-functional approach To function at an optimum level, supply management must
include not only the procurement group but other corporate functions that can add value
through interacting with suppliers, such as technology, logistics, manufacturing, operations,
distribution, and research and development, to name a few. The use of cross-functional teams
became a common way to involve other departments in supply management over the past
decade, but too many companies deploy teams without first developing a sound strategy for
how these teams will enhance value.
Appreciation of advanced communications technology While technology by itself will do
nothing to improve procurement/supply management operations, intelligent deployment of
advanced technologies within the confines of a superior supply strategy can reap great value -
value that not only is untapped, but often is completely invisible to even trained procurement
eyes. Far too many companies view technology use in procurement as a best practice unto
itself. These companies don’t truly understand that technology’s value is wasted unless it is
part of a sound supply strategy. Technology is a tool, not a strategy. When technology is not
used correctly, it can cause a lot of damage to supply operations.
Investment in procurement/supply management leading companies invest in training and
development programs for their own personnel and often for suppliers. They also invest in
communications and other technology.
Purchasing Ethics: All individuals involved with purchasing or other procurement related
activities must act, and be seen to act, with integrity and professionalism.
 Honesty, care and due diligence must be integral to all procurement activities within
and between the University, its suppliers and other stakeholders.
 Confidential information must be safeguarded. All participants must not engage in any
activity that may create, or appear to create, a conflict of interest, such as accepting gifts
or favor, preferential treatment, or publicly endorsing suppliers or products. Practice

35
 integrity, avoid conflicts of interest and personal enrichment, Gray marketing practices,
treat suppliers equally and fairly, and comply with legal and other obligations.

3.2.12 Procurement Challenges that haunt businesses of all sizes

Procurement leaders wear multiple hats and manage an array of responsibilities—from needs
identification to vendor management and payment processing. A day in the procurement
36
department is never slow. This makes a procurement manager’s job riddled with challenges and
difficulties. Such as:

1. Risk mitigation Supply risk is always a major challenge in the procurement process. Market
risks, potential frauds, cost, quality, and delivery risks constitute the most common type of risks.
Additionally, compliance risks like anti-corruption, policy adherence, and more keep your
procurement leaders up all night.

2. Dark purchasing Purchases that are made outside the defined procurement process fall under
dark purchasing. Such uncontrolled spending can ultimately be expensive for businesses. When
items purchased cannot be justified using capital outlay or material inventory, the resulting loss
of revenue and control is a significant challenge for organizations of all sizes to tackle. A great
way to reduce maverick or rogue spend is to bring your spend under management.

3. Grey Procurement an illegal term where goods are traded in an unofficial manner. . In the
case of the goods market, this market supplies goods of the authorized brands from
authorized manufacturers but through an unauthorized delivery channel.

4. Lack of transparency Spreadsheets were a terrific place to start when it came to organizing
data, but when you need a lot more out of them, they start to fall apart. The first issue you may
encounter is data access. It can be tough to locate information and track it across several
spreadsheets. The speed with which you can access information diminishes as the volume of
data grows. You must also deal with security risks and avoid disclosing too much information to

36
 too many people. Small mistakes and omissions can result in incorrect data, costing you deals,
clients, and vendor relationships. Automating your procurement process is the best way to
improve transparency.

5. Inaccurate data In order to make sound procurement decisions, organizations need accurate
and reliable data. Making purchases based on inaccurate procurement data can lead to inventory
shortages, excess inventory, and other additional procurement challenges that have the potential
37 to impact an organization’s bottom line directly.

6. Failure to adopt technology managing your procurement processes manually may appear
simple at first, but as processes become more complex, they become the largest roadblocks to
success. This is why one of the procurement challenges is to see technology as a helpful hand, a
partners who helps a company create value. To achieve future goals, becoming an expert in how
digital procurement solutions can decrease costs and foster innovation is critical.

7. Supplier-related issues one of the greatest challenges in procurement is supplier management.

From identifying the right supplier to keeping track of vendor performance and ensuring a stable
supply of quality products, the whole process is filled with complications.

3.3 Inter-departmental Co-ordination for Supply Chain Performance

Inter-departmental collaboration is when people with specific expertise work together to
complete a project or achieve a common goal. Supply Chain Co-ordination aims at improving
supply chain performance by aligning the plans and objectives of interrelated department. To
help your business thrive, it’s essential that you put in place an effective process that ensures
those various departments can work together.

3.3.1 Importance of interdepartmental collaboration

Healthy collaboration between departments is a sign of positive work culture. When the
resources feel comfortable working together and are aware of their colleague’s roles and
responsibilities, it is reflected in the customer experience. Problem-solving becomes a breeze
with effective collaboration between departments. One gets a different perspective on the
same issue making it easy to deduce a solution. It also opens doors for new learning
opportunities. When you communicate, you share knowledge and experience that will help
others learn from you and vice versa. In addition, it fosters trust and enhances morale in the
organization, eventually building a positive environment. This empowers the team and makes
everyone more efficient in their work. Overall, collaboration and effective communication
lead to an engaged, more open, and connected workplace.

3.3.2 Ways to improve collaboration between departments

Owing to the above-mentioned benefits, managers should strive to improve and
maintain cross-departmental collaboration. Here are some ways you can implement this
practice:

 Create a collaborative culture — Department members are more likely to collaborate

when it’s ingrained in the company culture. Build trust by creating an environment that
promotes collaboration with meetings, team-building activities, and regular follow-ups.

37
  Define communication channels and methods — Give your employees a space to
collaborate by defining the right channels and methods to communicate. Use
collaboration tools — Project management and communication software are powerful
collaboration tools to ensure your departments are on the same page with projects, no
matter how far apart they are. Concerned authority to be addressed and reached out to in
case of any pressing matter or escalation

38
 Share feedback — Listen to what your team members say about interdepartmental work.
They’ll tell you what works and, more importantly, what doesn’t work, so you can make
changes to optimize team collaboration.
 Right Technology in place- Projects that go through multiple departments typically
require authorization from several parties. Instead of dealing with printers, scanners, and
fax machines to add signatures to documents, use software that allows electronic
or digital signature like Acrobat Sign. Electronic signatures let department managers sign
documents digitally with the click of a button. This makes it easy for projects to move
down the line and promotes interdepartmental collaboration.
 Convey the ultimate goal and vision with transparency
One of the most important responsibilities of a decision-maker is to convey the firm’s
goals and objectives with the utmost transparency. If you expect your cross-functional
team to work cohesively, you need to periodically educate them about the goals and
vision. When your workforce is aware of how their work is adding value, they are more
likely to take initiatives. This will gradually increase communication and engagement
between different departments and maintain the flow of data.
 Organize team-building activities
All work, no play is a recipe for low productivity and disengagement. If your team is only
communicating formally during meetings or project discussions, then the human element
is missing from the equation. To get this right, department managers can coordinate with
each other and organize various team-building activities. This exercise is beneficial to
understand everyone’s strengths and weaknesses and act accordingly. It is always healthy
to have some fun at the workplace along with work.
 Train the staff for the right skillset
You may encounter a situation where you have already established communicative
company culture, but some team members still lack those habits that can help them
coalesce. Managers can initiate training programs to fill these skill gaps and make a
notable difference in team performance.
 Gain an enterprise-wide visibility
Effective collaboration can only happen when everyone in the team is on the same page,
or else it may lead to unnecessary conflicts. To do so, managers can deploy a resource
management tool that will provide them a bird’s eye view of the resources and projects.
With this, managers will be able to assign the right work to the right person and
collaborate better. Moreover, resources will be aware of the project’s progress and will
be able to work more efficiently.
 Understand the interdependencies
Employees must make an effort to understand these interdependencies. It will facilitate
them to collaborate better with other members of the team. For instance, if you are
working on the content, you can collaborate better with the design team when you know
how your work will affect theirs.

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  Initiate joint-projects between departments
The next step after understanding the interdependencies is to take up more projects that
involve cross-functional coordination. More so even, when resources will be involved in
other department’s processes, it will help them communicate better. They can then easily
solve complex issues together.

39

39
40

Chapter 4: Supply Chain & Coordination Department

40
 4.1 Supply Chain & Co-ordination Department: An Overview
The most dynamic and busier department of Pacific Jeans Ltd. (PJL) is Supply Chain & Co-
ordination Department, situated at NHT Fashion Ltd., Corporate office of Pacific Jeans
41 Ltd., whose primarily responsibility is to procure all kinds of goods & services for all sister
concerns of the PJL that are directly and indirectly related to production and simultaneously
coordinating & collaborating with User department, ARAD department, Commercial
department (Import, C&F, Export), MCD Department, Merchandising Department for the on
time and smooth production operation. This department has to content all departments by
ensuring the right product, at the right time, at the right place, to the right user. This
department is connected with all the member companies & manage their supply chain
functions from this single corporate office. Company believes it is the largest procuring
section in Chittagong.
The procurement operations of this department are split into four teams according to the
product categories which makes it speedy and easier for user department to place purchase
requisition when needed. The attributed/assigned four teams have been shown along with
their product list:

Team Product List

Trims and Accessories Fabrics, threads, buttons, zippers, care levels,
heat seals, hang tags, RFID stickers, Cartons
etc.
Project, Civil, Hardware & General Hardware, furniture, construction items,
domestic items.
Chemical, ICT & Stationary Chemical, Pocket fabrics, stationary, ICT
items (Computer, printer) En-cart printing
etc.
Engineering, Electrical, Machineries & All electrical product, machineries & sspares
Mechanical such as: Light, HVAC (Supply installation),
power cable, fire extinguisher & equipment,
GI pipe fittings, rubber gasket mat etc.

41
 4.2 Management Team of Supply Chain & Co-ordination Department

42
General Manager (GM)
Senior Manager
Deputy/Assistant
Manager
Senior Executive
Executive
Junior Executive
Purchase Assistant

Figure: Organogram of Supply Chain & Co-ordination

4.4 Objectives of Supply Chain & Co-ordination Department

The ultimate objective of this department is to procure all kinds of materials and goods
maximizing the overall value generated to keep up the operation smoothly and overcome any
kinds of operational bottlenecks. The following objectives are being pursued by this
department:
1. Ensure quality goods: Supplied quality goods as per user requisition
2. Ensure cost effectiveness: Cost savings through purchasing at the very minimum lower
cost and negotiation.
3. Ensure Right Sourcing: Sourcing from the best quality provider & sustainable
supplier
4. Ensure Timely Delivery: Shorten the Supply lead time (SLT) & demand fulfillment
lead time (DLT) such as : within 7-15 days
5. Establish Emergency supply lead time ( ELT) such as : within 2-5 days
6. Ensure timely payment: Process timely payment to supplier coordinating with audit
department to keep & retain B2B relation.

4.5 Enterprise Resource Planning (ORACLE- An E-business Suite) at

Supply Chain & Coordination Department
Pacific Jeans Limited gained business insight into Oracle Software (An integrated
Database) which was introduced for the first time in July 1, 2019 by a group of Pakistani
engineers and was considered as a revolutionary step forward to achieving greater success.

42
 ‘’ Being a preferred supplier to some of the world’s leading fashion brands, we rely heavily
on technology to support our business so that we can maintain our competitive advantage,
product quality and ensure timely delivery . Oracle application supports our financial,
purchasing and procurement. They are integral to the success of our operations and are
heavily embedded into our daily business- critical functions.’’ said Syed Md. Tanveer, MD,
Pacific Jeans Ltd.
43

1. PWC Pakistan -
Procurment , Bill
Dealar of ORACLE Settlement
(interface
designer) : Power
WaterHouse
Coporation (PWC)
2. PWC India -
Sourcing (inactive
Right now)

Every Department maintains inter and intra communication via this e-business suite.
 Every Work Procedure of a Supply Chain Executive is recorded and they can easily
get information of procurement information from the software.
 Here information about all the buyers, suppliers, other departments related to SCM
are uploaded and updated and the maintenance of this software is done by ICT
Department solely.
 Managers can make properly informed business decisions the moment they come into
work just by opening their business analytics dash board and getting all the latest
insight.
 From getting an update on stock, to generating a request for purchase to creating an
order for purchase, attaching comparative statement, placing an order, following up
with supplier, receiving goods, payment to supplier, Return of goods if issue arises, all
the tasks are done by Oracle Software.
 Use of this type of ERP system is suitable where work pressure is the maximum and
this software can support to get any procurement related data at any moment.
 It has brought all the internal stakeholders of SCM Department Under one umbrella.
Oracle Software has made the information flow much smoother than conventional procedures
and reduced consumption of paperwork.

43
 4.6 Work Procedure of Supply Chain & Coordination Department
The First and Foremost responsibility of this department is to procure essential products &
services for pacific jeans Group’s sister concerns. So, it has to perform many subtasks in
44 order to fulfill this role which are achieved through use of Oracle software.
STEP1: Creation of Store Requisition (SR) by User Department and send it to MCD
The user department raises a SR for goods when needed and sends it to MCD to see if the
requested items are in stock. A store requisition consists of the following items
 Demand justification by user
 Detailed Product specification (type, Quality & quantity)
 Timeline
 Approval from Head of User Department.
If product is available MCD delivers product and cancels SR.
STEP2: Creation of Purchase Requisition by MCD and send to the Audit
Department

If the requested products are not available in stock, MCD creates Purchase
Requisition and forwards it to Audit department for approval.

A Purchase Requisition consists of the following items:

 Justification for the Demand
 products specification ( types, quality & quantity)
 Time limitation
 Verification & Approval from Head of MCD
In case of Machinery or purchase against market forecast PR will be prepared after
getting approved Pro-forma Invoice or work order from SCM department.

STEP3: PR approved by Audit Department and sends it to Supply Chain &

Co-ordination Department
After getting PR for approval, Audit Department inspects inventory. If Audit sees
any discrepancy PR will be cancelled. After Approval, this PR is forwarded to the
SCM Department for next procedure.
A PR that has been authorized comprises the following:
 Product Information
 Purchase Volume

44
  Authorization from the Head of Audit Department.
(The Supply Chain & Co-ordination Department starts work from step 4)

STEP4: SCM gets PR and goes for sourcing through market survey & Collect
RFQ
45 When SCM gets a PR, it has to proceed with the following tasks:
 Identify whether goods need to procure from the overseas or local.
 identify whether vendor are listed or not
 Send Request for Quotation (RFQ)and collect quotation
 For Technical items take recommendation from Engineering
Department/user
In case of sourcing, the supply chain executives now think
• How they can get the product?
• Where they can find the product?
• What are the methods for obtaining the items?
The assigned executives has two exclusive types of sourcing. These are as follow:

 Most of the time, they depend on old suppliers. For choosing suppliers they see
• Reputation of suppliers
• Quality of product
• Price
• Ability and other important conditions
 If suppliers are new, samples need to approve by User Department. Then
supply chain executives request multiple suppliers to send price quotations
and relevant information about products.

Supplier Selection Criteria:

This Department prioritizes supplier who has

 Gmail/outlook ID
 VAT, AIT
 Permanent Address
 Compliance Factory
 Enlisted by BEPZA
 Business Identification Number (BIN)
 Tax Identification Number (TIN)
 Quality Assurance Certification

45
 STEP5: Negotiation and make a comparative statement (C/S) by SCM
After getting all quotations from the suppliers, then supply chain executives
negotiate with different terms, conditions like VAT, Mode of payment, Warranty
clause, Transportation Cost etc. Executives must follow the following criteria when
selecting price
46
 Quality Ensure
 low Cost
 Brand Confirmation

After getting quotation from supplier, SCM further negotiates the price because
Audit dept. checks whether the price is at minimum level or not.

Cost saving opportunities are more for SC HR than other department, they can save
cost through:

Negotiation

On time Order Processing ( ex. overstock leads to Chemical
damage & higher warehouse cost)
 R&D and merchandising dept. may suggest SCM about low cost
Items.
 Through Properly selecting Harmony System (HS) Code
Then executives create Comparative Statement with minimum three suppliers who
meet suppliers’ criteria to greater extent and with necessary approval CS send to
Audit.

STEP6: Obtain Necessary Approval:

After completing the comparative Statement, the next step is to obtain the necessary
approval. The following permissions are required:
 Senior Manager : Review the CS provided by the executives in detail
 General Manager: Approve the CS
 ARAD Department: Final Authorization from the ARAD. Audit approves the
Comparative Statement with signature in the specific place and sends to SCM.

46
 STEP7: Placement of Purchase Order (PO) by SCM

Now the supply chain executives place purchase order to the specific suppliers. PO
can be of two types a. Trade PO- for direct material generated from
47
merchandising’s Bill of material (BOM) b. Non Trade PO- for indirect material
generated from MCD. The PO needs to include the following items:
 Specification of the product
 PO number
 Approved Price
 Quantity
 Agreed terms and condition
STEP8: Goods received by MCD and Monitor the delivery process by SCM

After the purchase order has been placed, Supply Chain & Coordination
Department looks after the delivery process. Usually the purchase assistant looks
after this process. When the products arrive, Material Control Department receives
the products and creates a Goods Received Notes (GRN), gets a quality approval
from user and sends it to the Supply Chain & Coordination Department including
the delivery Challan from supplier. A GRN must include
• Respective company name
• Supplier information
• PO number
• GRN Number
• GRN Date
• Challan Number
• Product Quantity and Shortage (if any)

STEP9: Billing Procedures by SCM

In the meantime, the supplier sends the pro-forma invoice to the Supply Chain &
Coordination Department for clearing the bill. After receiving the documents from
MCD, the executive makes necessary adjustment as follows:
 Verifying that the bill matches the delivery Callan and QC quantity
 Observing discrepancies and making a note of them
 Attaching required papers in accordance with the audit checklist
 In the event of a foreign purchase, certify that the payment has been received by the
issuing bank and that the money has been disbursed.
 Sending invoices to the accounts department with the appropriate paperwork and
management clearance for payment clearing and finally the SCM inform the supplier
to collect the bill.

47
 STEP10: Record Keeping

One of the most essential jobs of Supply Chain HR is to keep record of what he/she
has done. Because it serves as a guide for future SCM duties like Sourcing,
48
negotiating, establishing contact with suppliers. It is a continual procedure that
begins with the receipt of an authorized PR from the Audit department. SCM
executives must keep the following things in mind when keeping records:
• Product details
• Product quantity
• Supplier’s details
• PO number
• GRN Number
• Delivery Update & date
• Payment related information.

4.7 Procurement process of Supply Chain & Coordination Department

(Both local & foreign)
Procurement is the primary activity of Pacific Jeans Limited's Supply Chain &Co- ordination
Department. Pacific Jeans Limited’s procurement process can be classified into two
categories:
4.7.1 A. Local Procurement Procedure :

If the materials or goods are procured from the local market, then the following procedure
needs to be followed.

48
 SR checked by MCD, if
stock is available MCD PR approved by audit
Store requisition (SR) cancel SR & sends goods department & forward to
by user Department to user. if stock is not SCM
available, MCD creates
Purchase requisiton (PR)
49

SCM prepares a
SCM starts procurement
SCM justifies the comparative statement
of material & send
demand/PR & sources (CS) of supplier price &
Request for Quotation
the raw material select the best alternative
(RFQ) to suppliers
under prescribed criteria

After receiving of audit

Submit the CS for audit Audit justify the CS & approval - SC prepares
Approval sends back to SCM the purcahse order (PO)
& sends to the supplier

MCD received goods &

supplier receive the PO Supplier ensure goods
create a Goods
& Arrange goods delivery to MCD of the
Receiving Notes (GRN),
delivery buyer organization
Then forward to SC

Audit Once ageain

justifies A-Z
SCM checks the GRN & SC forward the bill,
procurement work &
initiate the bill for GRN to the concern
appove the bill for
payment Audit department
Payment & forward to
Accounts department

Accounts check the bill

and calculate
Supplier receives
deductions. Then
payments to their bank
arrange the bill
account
payment through
banking channel

Figure: Local Procurement Flowchart

49
 4.7.2 B. Foreign Procurement Procedure
When the required materials or goods are procured from the foreign market,
then the following procedure needs to be followed.
50

RFQ-CS of suppliers price

by considering: customs Approval of CS & selects a
Demand Justification
duty-tariff, payment mode, supplier
shipment condition etc.

Apply for import

Provide the PO, request for
announcement, prepares Finalize the LC by
PI, check the HS code & PI
LC/DC & sends the draft rechecking all the terms
approval
to the supplier

Receiving of
Transmission of LC /DC and
BOE,BL/AWB,CI,PL & other Cargo Receiving at the port
shipment arrangement by
shipping documents from of discharge
the supplier
supplier

Submission of original
Receiving of Cargo Release
BOE,BL/AWB,CI,PL,COPY
permission( after examine Pay the import Duty
OF transmitted LC/DC to
& assessment)
the Customs authority

Release the cargo Adjust the LC/DC expense Close the procurment

Figure: Foreign Procurement Flowchart

50
 STEP1: Place order & Requesting suppliers to send Pro-forma Invoice (PI)

As per PR, SCM concern places the booking to supplier and want to know the
delivery date & ask supplier to send pro-forma invoice to the executives. In Pro-
51
forma Invoice, the following point must need to be checked:
• Pro-forma Invoice number
• The description of buyers, suppliers
• Product details with price
• Mode of transports
• Payment types
• Country of origin
• Port of loading & port of destination names.
• Advising and beneficiary bank names
• Packing list & information
• LC validity
• partial shipment , transshipment is allowed or not
• HS code number
• Tax rate, freight types etc.

STEP2: Send Pro-forma Invoice to Audit

Then supply chain management executive sends the pro-forma Invoice to the Audit
and Audit approve it.
STEP3: Forward the PI to Commercial Department

After Audit endorsement, PI forwards to Commercial Department for opening LC

(if payment terms is via LC) and to release the payment (if the payment term is via
after shipment TT). Commercial Creates or release the payment and send the LC
copy/ payment copy to SCM executives.

STEP4: Receiving L/C and send to suppliers

Then supply chain management executive sends L/C to the suppliers and request
for shipping documents.
STEP5: Receiving Shipping Documents

When supply chain management executive receives shipping documents from the
suppliers, they transfer it to the Commercial Department to check the documents
and if the documents are okay then commercial department collects the original
documents from advisory bank and appoint C&F agent to release the goods. Then
Commercial Department supervises it and it continues before receiving products.
Then MCD receive the product and other procedures are same. For payment
commercial contract with bank. For payment they mostly use Sight L/C, Deffered

51
 L/C and TT. Merchant and chemical items need more efficiency and urgency for
smooth production. And the sourcing of merchant items is done by the
merchandisers.

52 4.8 Intra Business Supply Chain Network

Though Supply chain & coordination department has linked with all the departments of
pacific jeans ltd., it has to work with some specific department for intradepartmental
collaboration to build successful supply chain network.

Audit
Depertment

Commercial Supply
Department Accounts
Chain & Co- Department
ordionation
Department

Matrtial Control User

Department Department

Figure: Intra-business Supply Chain Network

4.8.1 User Department: The end users all of raw materials in the end. When they are in short
on the supplies they need, they create a store requisition. The supply Chain &
Coordination Dept. contacts with user department after getting PR from MCD to clarify
about exact product details so that no operational bottlenecks occur in the production.
Example of user department can be of :

52
 4.8.2 Material Control Department (MCD): Warehouse is an integral part of supply chain
practice. Though here in Pacific Jeans warehousing activities aren’t done by Supply
Chain & Co- ordination Department, it keeps a sound communication with Material
53
Control Department (which does the warehousing & Inventory Management) to
make supply chain process effectual
 Goods Received Note (GRN):: MCD creates GRN after warehousing the products
and sends it to Audit department with proper authorization.
 Discrepancy between PO & challan: if there sis any mismatch found between
Purchase Order receipt and Challan/Bill receipt, MCD immediately inform SCM
department or return the goods to the vendor.

4.8.3 Audit Department: Audit department is bestowed with the responsibility of auditing
different procedure to make it sure that all the procedures are in the right track ensuring
transparency in all the operational process. It fulfills following duties:

 Monitors inventory: when a purchase requisition ( PR) for an item is raised by user
department, the first duty of this department is to check the warehouse to be ensure
that whether the item , PR raised for, is available or not.
 Approves Purchase Requisition (PR): if the item in the SR is not available, the audit
department approves the (PR) and sends it to SCM department.
 Approves comparative statement (CS): the SCM department sends comparative
statement to audit department for final authorization.
 Approves purchase order (PO): if everything seems okay, then audit department
approves the PO.

4.8.4 Accounts and Finance Department: After posting bill to the accounts department by
supply chain executives, suppliers collect their payment from the accounts. This
department is very important for supply Chain management because any delayed in the
payment process, may annoy the supplier and thus he may stop doing business with the
firm or stop offering credit sales.
4.8.5 Commercial department ( Import, Export & C&F)
a. Import and C&F Department
For procuring import oriented product, The Supply Chain & Coordination Department
needs to work hand in hand with Commercial Department. When SCM executives
receive Pro-forma Invoice from the suppliers, they transfer it to the commercial
department to arrange the following two responsibilities:
 Creates Letter of Credit (L/C) for import items dealing with banks
 Appoint C&F agents for clearing the products from the port and monitoring the
transportation.
Then Commercial department supervises it and it continues before receiving
products.
Commercial Department has to deal with various delivery and payment terms:

53
 1. Delivery Terms:
 Freight On Board (FOB): If a shipment is designated FOB, then as soon as the shipment
of goods leaves the seller’s warehouse, the seller records the sale as complete. The buyer
owns the products en route to its warehouse and must pay any delivery charges.
 Ex-work: In ex-work, the seller makes a product available at a designated location and the
buyer is responsible for all logistics and costs thereafter.
 Cost and Freight (CFR): In CFR, seller is required to arrange for the carriage of goods by
54
sea to a port of destination and provide the buyer with the documents necessary to obtain
them from the carrier.
 Carriage Paid To (CPT): CPT rules require the seller to clear the goods and arrange
carriage to the named place of destination. The seller does not need to obtain or pay for
insurance.
 Free Carrier (FCA): In FCA, the seller is responsible for export clearance and delivery of
goods to the carrier at the named place of delivery.

2. Payment terms:

 Letter of credit (L/C): A payment mechanism used in international trade to provide an

economic guarantee from a creditworthy bank to an exporter of goods. LC at sight, Deferred
LC (120 days) , Irrevocable LC are mostly used by PJL.
 Sales contract: It acts as a legally binding contract between two seller and buyer involved
in an exchange of money for goods & services.
 Telegraphic Transfer (TT): An electronic method of transferring funds utilized primarily
for overseas wire transactions. It can be after TT or before TT.
 Document against payment: Arrangement under documentary collection in which an
exporter instructs the presenting bank to hand over shipping and title documents to the
importer only if the importer fully pays the accompanying bill of exchange.
 BEFTN: when procuring from local market, PJL uses Bangladesh electronic fund transfer
network system.
3. Transportation Modes:
 Air - for top urgent, low quantity & expensive goods
 Sea – for bulk amount, medium priced goods
 Road – best for local procurement, less expensive, flexible
 Rail – less expensive, flexible

54
 4.9 Some specific product & Buyer wise procurement process

1. Chemical Items: For purchasing chemicals for washing, printing,

Engineering, Effluent Treatment Plant (ETP), a specific supplier selection
55 process needs to be followed.

Collection of SCM collects these

documents from documents and sends
ECR checks documents
supplier such as to Environmental &
and ask for sample
MSDS,TDS,EIM,ZDHC(1- Chemical Responsible
5) level Unit (ECR)

R&D department trails the

sample. Two options: If the suppllier is rejected , he
1. if the sample is ok- enlist the may challenge the R&D and
supplier sends the sample again.
2. not ok- reject the supplier

Quality Defection (Chemical) solution process

Aknowledged by Disclaimed by
Supplier Supplier

Supplier sends local agent to

Buyer Breaches the business
check and provides new
partnership with supplier and
chemical if buyer's claim is
marks them as blacklisted.
true.

2. Project based work

For project based work (Engineering items), the assigned engineering executive
supervises the installation work, deploys 3PL (Contractor) for installation and asks

55
 Supplier for Request for proposal (RFP) where the following agreement needs to be
included
a. Scope of the work:
 Supplier: Items parts of PC
 Buyer: Connection among parts of PC
56 b. Terms and Conditions
c. Pre-shipment Inspection – before receiving goods from supplier,
PJL’s agent checks whether all terms and conditions are ok or not.
PJL does this 3PL service by local university like CUET, BUET.
d. Splitting payment system for project based work
At the starting period of 10% Mobility cost
agreement
Work in progress 75%-80% Work
completion
cost
Defect Liability Period ( DLP-1 5%-10% Defect cost
Year)
 Before finalizing any BOQ (Bill of quantity) PJL engineering take prior permission
and approval from Engineering consultant (if any) or PJL BOD, Higher authority.
 If any change is required by the vendor they must submit the proposal to PJL
authority.
Example of service project (knit composite Industry):
 Fabrication & Installation ( Mechanical utilities)
 Erection & Installation ( Machineries & utilities)
 Supervision ( Mechanical & utilities)

3. Subcontracted work

In Jun, July, September, October, the amount of Work order is high. So, some
embroidery works are done by subcontracted. The PJL’s MIS system enlists the
subcontractors and pays for designing embroidery work in two ways:
 Normal design - $.20
 Critical design - $.25
There are two terms for searching 3PL for embroidery work
 Bonded Area (CEPZ) - if the 3PL is from the CEPZ area, no
permission from BEPZA is required.
 If the 3PL is out of CEPZ, in & out permission from BEPZA is
needed to be taken.
For procuring ICT items from branded company, SCM uses CAD Design such as
Gerber software.
In case of contraction work, such as servicing (Painting), VAT needs to be paid on
the basis of:

56
  Material Based Construction : 10.5%
 Service Based Construction: 7.5%

4. Buyer wise procurement (Accessories)

The Trims & Accessories team of Supply Chain & Coordination Department works
57
directly with merchandising department (items reference code such as
ASCLDBLK- care label, provided by merchandising dept.) as they have to procure
direct garments related materials on time attached with jeans from supplier
nominated by Buyer such as ZARA. Such as care level, tag pack, RFID sticker ect.
This Team Leader assigns a particular’s task to a particular accessories executives
(at least 3)to arrange all needed items to deliver the finished product. Here PR
comes from merchandising dept. and bill entry is done according to Bill of material
and pacific file.

4.11 Supply Chain Register (Purchase & saving statement)

Supply Chain Register Form is a Summary work history of each employee who
inputs what he has done throughout the week at Saturday & shows the amount of
savings. Some attributes of this form are as follow:
 PR, PO , CS quantity
 PR line item Quantity
 Inter-company visit
 Bill submission quantity
 Meeting
 Cheque Payment
 Days & Hours of Overstay at office etc.

4.12 Success through Effective Performance (STEP)

A form which is used to highlight performance objectives review of the year. It

emphasizes on achievement against agreed objectives such as
 Proper record keeping
 Enhanced Sourcing
 Cost Savings
 Purchase Order Cycle
 Reducing rejection rate etc.

4.13 Bonded Area Facility

As pacific Jeans Ltd. took bonded area policy under which PJL can import key garments
related items without any duty, which ensures that the exporter will be paid all required duties
and taxes by PJL’s import business. In turn, it facilitates to procure duty free key materials
from abroad. Also, PJL Gets 4% incentive from govt. and 1% incentive if it exports in USA/
EUROPE.

57
58

Chapter 5: Findings, Recommendations & Conclusion

58
 5.1 Negative Findings:
59

1. Excessive workload and pressure: The Supply Chain & Coordination is a very
dynamic department at Pacific Jeans Limited with a very high workload and pressure
because of
 Since this department has to procure all kinds of items for the entire organization
(for 15 sisters concern). The existing number of procurement manpower is not
sufficient which leads to high workload and pressure.
 Each procurement executive is assigned to procure according to items basis and
buyer wise. No new employee is hired immediately after the resign of any existing
employee or when any employee shifts from his items. Which then creates extra
work pressure on other peers.
2. Lack of necessary off-the-job training: This department is in lack of required off-the-
job training such as:
 The newly employed executive has to learn work procedure and organizational
culture by participating in activities directly i.e. on-the-job training system- sitting
beside one existing employee, observing his work and follow instructions.
Employees do not have access to a separate off-the- job training facility. It may
take almost 3 to 4 months to begin his assigned responsibilities downright. Also
this system creates extra workload for employees as they has to perform routine
work daily.
 No training for the existing employee regarding updated system & rules and
grooming.
3. Unable to leverage whole SCM benefits: Pacific Jeans’ Supply Chain & Coordination
Department cannot implement the concept of proper SCM since this department is
slightly incomplete as MCD and commercial department, planning are separate
department in the company.
4. Lack of interdepartmental co-operation: the supply chain & Coordination department
has to work closely with a number of other departments but there is a lack of coordination
among them such as some may not willing to share necessary information on time, such
as one department sometimes has to push another department to prepare necessary
documents talking about deadline and to create GRN to settle billing.
5. Frequently revised comparative statement: Due to change in material price in the
market and import based materials are shortage to the supplier, the SCM department
needs to revise the comparative statement frequently. Also some time different units want
different brand’s products for the same items. So, it requires to make repetitive CS for the
same products which consumes extra time & cost.
5.2Recommendations:

1. Device a fully integrated SCM solution: It’s not possible to change the current
supply chain practice overnight. Company should develop a process so that it can

59
 transform to integrated network supply chain practice. The company should devise a
procedure for transitioning itself to integrated supply chain approach by bringing all
SCM-related sub-sectors under one umbrella.
 Development of integrated supply chain model by aligning MCD , supply chain &
coordination, Merchandising, and commercial department Through
 It should keep the supply chain & Coordination, MCD & Commercial, audit
department in the same aligned department using supply chain technology such as
60
SAAP, Oracle, Tally system which allows managers to integrate their supply
chains and collaborate more effectively. Thus the best SCM outcome will be seen.
2. Develop & arrange necessary training program: Business nature and environment
is continuously changing. Only a well-developed and on time training program can
assist employees to cope with this changing situation. Proper off-the-job training can
help in agile operation in this department as it will help by on-boarding new employee
quickly and at the same time, help the existing employees to adapt to the changing
business world. Training can be on:
 Grooming session
 Standard Operating Procedures
 Record keeping
 Corporate culture & Transparency
3. Develop proportionate order system (EOQ): currently, the supplier who offers best
quality, gets the full order. This halts the way to create relationship with other supplier.
At first, a supplier category must be developed than order must be placed
proportionately so that the company can keep a good relationship with all the supplier.
This relationship will give extra negotiating power. Such as: SCM procurement
executives maintain an order ratio when Purchasing items such as 90% from old
supplier to establish long term relationship and 10% from new supplier to create B2B
relationship with new one. This Strategy Provides multiple channels from which to
procure goods and services, drives competition (on price and service levels) between
the company’s existing and potential vendors, allows a company to take advantage of
new opportunities for business expansion with the emergence of new consumer needs
based upon shifting demographic realities.

4. Employ required number of manpower: To procure in a timely manner and alleviate

extra work pressure, a few skilled manpower needs to be recruited for this dynamic
team. this department can employ
 More expertized and skilled permanent manpower
 Involve part time workforce during peak season to balance demand and supply
basically for documentation processing purpose such as bill posting (SCM Bill
Verification)
5. Focus on Strategic long term supplier relationship management: Management
should build a long term relationship with reliable supplier by having better customer
service, make an entire department responsible and make procurement practices more
of a team effort to boost company morale and improve strategic approaches to

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 purchasing. For positive effect of the best procurement practices, there should be a
labor force with effective management skills that develop clear and professional
specifications with full knowledge of a competitive process negotiation and monitoring
skill.

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5.4 Conclusion
Pacific Jeans Ltd.’s, 100% export oriented and largest RMG sector in Bangladesh, Supply
Chain & Coordination Department basically focuses on procurement of goods for all sister
concern which offers the inputs needed for a business to run day-to-day operations and exists
as one of many branches within the supply chain structure. Also this department has to work
hand in hand with Audit, Accounts, commercial, MCD, User Department for processing
procurement. I had a very little idea about Procurement and how a Company Coordinates
among interrelated departments but working with a variety types of expertise employee, now
I have a good grasp on this subject matter. The critical evaluation of the entire process has
given me the opportunity to put some of my own opinion on the ongoing process to indicate
the room for improvement. Now I also know about numerous types of raw and finished goods
& their price, negotiation strategies, VAT, AIT, MUSHAK 6.3, 6.6 System & processing
required for RMG sector., It can be said that Pacific Jeans is a best example in our garments
industry as a cutting-edge technology based company with greater competitive advantages
and I am fortunate enough and really honored to be a part of this Organization.

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Chapter 6: Learning From Internship

62
 6.1 Learning from Internship:
I applied for a Supply Chain Management internship at Pacific Jeans Ltd., which offers co-
working spaces for business intern. I knew this would be an excellent opportunity for me to
63 meet different supply chain executives in the co-working hub, learn about their working
procedure and job responsibilities, observe how Supply Chain operates for a business and
expand my knowledge and network, corporate culture through working with a variety of
bright minds who have a diverse set of skills.
13. Practical Tasks: During internship, I have practices the following tasks at Oracle
Software:

 Bill Entry (SCM bill Verification)

 Placing Purchase order
 Pro-forma Invoice Entry
 Subcontracted Work Order placement
 Old PO cancel & enter new PR into old PO
 Care label, RFID Sticker, Hand Tags booking via website at ASOS & Trim-co
Group. ( Just saw the booking process, since if there is any wrong in the booking ,
this will create complexity latter)
 File Management & Documentation Checking & processing
 Application of Outlook email & Company’s Web portal

Career Focus: Lucy’s story

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References
Online website
 https://books.google.com.bd/books/about/Supply_Chain_Management.html?id=gd22AA
AAIAAJ&redir_esc=y
 https://www.google.com/search?q=supply+chain+management+sunil+chopra+6th+editio
n+solutions+pdf&sxsrf=ALiCzsZWqCXeQvx9S293YYVKsOUlaXuWcg%3A16670283
20923&ei=YNVcY8rrN_-
A2roPnNONkAQ&oq=supply+chain+management%2C+sunil+&gs_lcp=Cgxnd3Mtd2l6
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MQsAMQJzoKCAAQRxDWBBCwAzoNCAAQRxDWBBCwAxDJAzoICAAQkgMQs
AM6BAgjECc6BwgAEMkDEEM6BAgAEENKBAhNGAFKBAhBGABKBAhGGABQ
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managemehttps://www.google.com/search?q=3+stages+of+procurement+process&sxsrf=
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 https://www.google.com/search?q=reasons+to+digitizehttps://www.infoentrepreneurs.org
/en/guides/negotiate-the-right-deal-with-
suppliers/+procurement+process&sxsrf=ALiCzsbNTwdu5ihxk3NgX4LJqdWoo6Nc2Q:1
666699530178&source=lnms&tbm=isch&sa=X&ved=2ahUKEwij38XLq_v6AhVQ3Tg
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j0M
 http://nraomtr.blogspot.com/2011/11/supply-chain-management-coordination.html
 https://www.adobe.com/sign/hub/features/tips-for-interdepartmental-collaboration

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