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    Pre - Feasibility Study

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    Anand Jignasa
    This document provides a pre-feasibility study for a proposed polo t-shirt manufacturing business in Pakistan. The business would produce 2,000 t-shirts per day for export and contribute to foreign exchange earnings. It would initially operate by providing contract manufacturing services and later become an export-oriented business. Total project costs are estimated at Rs. 7.5 million. The business would require 52 sewing machines and related equipment as well as suitable factory space. Key success factors include ensuring quality, on-time delivery, competitive pricing and good customer service and communication. Threats include quota restrictions and competition from other garment exporting countries.

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    Pre - Feasibility Study

    Uploaded by

    Anand Jignasa
    967 views23 pages
    This document provides a pre-feasibility study for a proposed polo t-shirt manufacturing business in Pakistan. The business would produce 2,000 t-shirts per day for export and contribute to foreign exchange earnings. It would initially operate by providing contract manufacturing services and later become an export-oriented business. Total project costs are estimated at Rs. 7.5 million. The business would require 52 sewing machines and related equipment as well as suitable factory space. Key success factors include ensuring quality, on-time delivery, competitive pricing and good customer service and communication. Threats include quota restrictions and competition from other garment exporting countries.

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    This document provides a pre-feasibility study for a proposed polo t-shirt manufacturing business in Pakistan. The business would produce 2,000 t-shirts per day for export and contribute to foreign exchange earnings. It would initially operate by providing contract manufacturing services and later become an export-oriented business. Total project costs are estimated at Rs. 7.5 million. The business would require 52 sewing machines and related equipment as well as suitable factory space. Key success factors include ensuring quality, on-time delivery, competitive pricing and good customer service and communication. Threats include quota restrictions and competition from other garment exporting countries.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    967 views23 pages

    Pre - Feasibility Study

    Uploaded by

    Anand Jignasa
    This document provides a pre-feasibility study for a proposed polo t-shirt manufacturing business in Pakistan. The business would produce 2,000 t-shirts per day for export and contribute to foreign exchange earnings. It would initially operate by providing contract manufacturing services and later become an export-oriented business. Total project costs are estimated at Rs. 7.5 million. The business would require 52 sewing machines and related equipment as well as suitable factory space. Key success factors include ensuring quality, on-time delivery, competitive pricing and good customer service and communication. Threats include quota restrictions and competition from other garment exporting countries.

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    The key takeaways are that the document discusses starting a polo t-shirt stitching business in Pakistan, including an introduction, opportunity rationale, proposed capacity, process flow, industry structure, marketing, costs, timelines, success factors, threats, and regulations.

    Some of the key factors that favor expansion of the knit garments industry in Pakistan include the availability of suitable raw material, development of certain skill levels, and introduction of international brands with local garment manufacturers.

    Some of the main threats to the knit garments business in Pakistan include quota factors affecting exports, unpredictable labor, lack of best stitching expertise, and increasing competition from other Asian countries.

    PRE- FEASIBILITY STUDY

    Polo T-Shirts

    Submitted by: Anand Jignasaben, Anshika Rawat, Devesh Raushan, Ekta Gupta, Sonam Anand

    INTRODUCTION
    Most of the production of this unit will be for export purpose, and hence will contribute in the earning of foreign exchange for the country. There is a vast range of knitted products like knitted T-shirts, blouses, trousers and shorts etc. However, this unit is designed on basic Polo T-shirt. Initially, for some time period, this unit will operate on CMT(Cutting, Manufacturing and Trimming) (commercial basis), but ultimately, this would be an export-oriented unit. This project will also have the potential for horizontal as well as vertical integration.

    OPPORTUNITY RATIONALE
    The availability of suitable raw material, development of certain skill levels and introduction of international brands with local garment manufacturers are some of the favoring factors for further expansion of knit garments industry in the country. The quotas phase out factor in the year 2005 is also opening new doors of opportunities in the global trade of garment exports in the coming years.

    It has been forecasted, that in the coming days of post quota scenario, specialized and small or medium size garments stitching units will be able to perform in a better way.
    The reason for this is a lower cost structure and more developed and concentrated skills to produce the best possible products as per the requirement of international customers.

    Proposed Capacity:
    2,000 Garments/Day (52 Stitching Machines)

    Total Project Cost:


    Rs. 7.5 Million

    PROCESS FLOW CHART

    CURRENT INDUSTRY STRUCTURE


    The garments and apparel industry of Pakistan, especially the knitwear segment, is characterized by heavy presence of vertically integrated units. 700 vertically integrated units in the knitwear sector. 4,000 garment units with a diverse range of stitching capability including leather, knit and woven garments. 1,000 stitching units manufacturing T-shirts for export Major concentration of the industry is in Lahore and Karachi. Other hubs are Faisalabad, Gujranwala, and Sialkot.

    MARKETING
    In view of the fact that main raw material and skilled manpower is available in Pakistan, scope for garment exports from Pakistan is unlimited. Effective marketing plays a very crucial role for making this business a success. Export orders can be generated either through local or foreign buying houses that have their presence in the country and source export orders for foreign customers from local industry. The other way to get export orders is through direct marketing in the international markets while initiating contacts with potential customers directly and/or through participation in international trade fairs, exhibitions etc. In the absence of export orders, other factories that have excess export orders can also provide subcontract work on CMT (cut, manufacture & trim) basis.

    Guidelines for Garments Export Business


    Ensure best quality at all costs. Commitments with buyers regarding quality, price and shipment are basic essentials Concentration should be on non-quota or low priced quota garments and on those categories of garments where newcomers can get share of the cheap quotas at the time of auction. Sourcing of export orders, can be a good startup point of marketing efforts. The prices offered by these buying houses might be lower than those of direct orders, but at least they can be good entry point and learning experience for new exporters. Many garment factories are considering it worthwhile setting up their overseas offices and warehouses in the potential markets. The professional marketing staff and owner(s) should regularly visit international clothing fairs, shows and exhibitions. It is very important to be active, quick in response to the customers and flexible with buyers regarding their requests and requirements Regular subscriptions with local and foreign textile trade and fashion magazines will ensure the flow of latest marketing and trade information to the exporter.

    Total Market Size and Growth


    Total global trade value of T-shirts and other related knitted garments is more than $33 billion.

    USA is the largest importing country with a share of 29% and a total value of $7.4 billion. USA is a rapidly growing market with annual growth rates of 10% in value terms and 7% in quantity term.
    Germany is the second largest importer in this category with imports of $4.5 billion. However, German market has been stagnant during last many years and has grown by only 1%. Japan is the third largest importer with total imports of $3.8 billion. Kenya, Tunisia, Zimbabwe, Algeria and other African countries are growing markets for T-shirts.

    RAW MATERIAL
    The main raw materials used in the manufacturing of Polo T-shirts are listed below:
    Printed or dyed knitted fabric (may be 100% Cotton or Polyester/Cotton in different ratios) Buttons Threads Labels Zippers Packing material

    HUMAN RESOURCE REQUIREMENTS


    For a garment-stitching unit of 52 stitching machines.

    MACHINERY DETAILS

    Machinery List
    Following combination of stitching machines is required for manufacturing 2,000 knitted Polo T-shirts per day. Approx. prices for Japanese origin machinery as given below:

    LAND & BUILDING


    Total Land Requirement
    For garments stitching unit with production of about 2,000 garments per day, approx. 13,640 square feet covered area is required.

    Covered Area Requirement

    Recommended Mode
    It is recommended that this project should be started in a rented building. This will reduce the initial capital cost of the project.

    Suitable Locations
    The clusters of garments stitching industry exist predominantly in Lahore, Karachi and Faisalabad. The basic criterion for the selection of location within these clusters should be the accessibility of skilled manpower.

    Utilities Requirements
    Electricity Telephone Fax

    PROJECT COSTS

    ESTIMATED TIME FRAME FOR PROJECT COMPLETION


    2 months for completion of initial formalities, i.e. formation, registration of the company etc. 3-4 months for purchase, import and shipment of machinery, installation and trial run. 2-3 months for furnishing and staff/labor appointments and trial production. In case of self financed project, rented building, and local procurement of machinery, this setup can be started even within a few weeks time period. Getting finance from the bank may take 3-4 months. The project can take-off within 6-8 months as some of the activities will be in progress simultaneously.

    KEY SUCCESS FACTORS


    Assurance of high consistent quality Surety of on time delivery Competitive rates Cost efficiency Better services to the customer i.e. claim settlement etc. Better communication with the customers To run a garment manufacturing set-up is a full-time job, and requires continuous hard work and attention. Anyone who is not prepared to put best possible efforts, concentration and hard work should not attempt to enter in this business.

    THREATS FOR THE BUSINESS


    Quota factor (price and availability) plays a major role in defining the trends of exports of knitted products from Pakistan, and directly affects the exports of knitted garments.

    The labor force at the lowest level i.e. skilled/semi skilled manpower, machine operators are quite unorganized. Their job behavior and seriousness about the completion of any assigned job is sometimes quite unpredictable.

    Stitching expertise is not available at the very best possible level

    In case of CMT based unit, the requirement of credit and/or delay of payments from customer side might cause disturbance in the cash cycle.

    Asia pacific markets are emerging as new players in the world knitwear trade. Competition from China, Hong Kong, Vietnam, Korea is likely to increase in the coming years. NAFTA is also one of the threats.

    REGULATIONS
    Being the export-based unit, tax exemptions are available on earnings and profits. Also, government offers re-finance facilities, incentives in terms of rebates, and duty free machinery imports.

    REFERENCES
    SMEDA Polo T-Shirts Stitching Unit Kapra Boutique Pre-Feasibility Study BOUTIQUE (Women Designer Wear) 264TextilesFeasibility. giz2011-commercialisation-solar-energy-india-en

    Questions invited..

    THANK YOU

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