Business Plan for Entering the Indian Textile Industry

Business Plan for Entering the Indian Textile Industry Textile industry means which produces all types of fabrics, yarns, combs, boffins etc.. it also includes all ready made garments, blankets (woollen / acrylic). India is leading country of cotton fabrics and wollen carpets and cotton durries. To establish a textile industry a huge amount is required and it is around 1 2.5 crores of rupees. After the issue of capital is settled second comes the problem of land and machines for the manufacturing concern. When we select a location for our business we need to have certain things in our mind like the location should be best suited to the business and environment. Then we have to register that location so that we will not be facing any problem regarding its ownership and authorization. After we have settled all the above issues we have to decide the channels from where would we import raw materials and through which we would distribute finished goods. We are importing raw materials for the woolen, acrylic blankets , knitted garments and socks from USA, CANADA, ITALY, GERMANY and The raw cotton from south Africa. As presently they are the largest producers in there respective field. The govt of India is also helping us to establish our business by giving us incentives by way of establishing special economic zones where we can establish our own unit. Under special economic zone the rate of land is very concessional on monthly basis. The machines we are importing are under NIL rate of duty with the conditions that manufactured products will be exported to outside india to gain the foreign currency. Our Most of the inferior units are situated at PANIPAT (HARIYANA), LUDHIANA ( PUNJAB), Surat (GUJRAT) which are manufacturing sarees, socks, suiting and shirting fabrics. This is a very good industry and profit earning sector because everyone needs clothes to cover his body. So in my opinion the textile industry is the best sector which provides jobs to unskilled laborers and profits to the owner of the unit. To set up a business we have to apply to the commerce ministry for license, the application will be made on the payment of fees prescribed by the government of India. EXECUTIVE SUMMARY Textiles are one of the most commonly known and important business. It includes: 1) Transforming of raw materials into final goods, i.e. the preparation of production of fibres and/or the manufacture of yarns by spinning; 2) Production of knitted or woven fabrics; 3) Finishing activities, like bleaching, dyeing, printing, coating, which gives the satisfaction desired by consumers; 4) Transformation of the fabric into garments (clothing industry), home textiles, e.g. bed linen, table linen and curtains, or industrial/technical textiles, e.g. ropes and netting; 5) After completion of all the above steps comes the importing, distributing and retailing and that is the very important part of any business. It includes many country to complete this step as now a days it business have become more innovative and competitive. Fabrics designed and manufactured in one country may be send to design in another, machined in a third and finished in the originating country.In addition, retailing of garments is now common across national boundaries. COMPANY OWNERSHIP The founders of the company are Rajani aggarwal and Vishal Kataria, will handle day-to-day financial and business operations of the plan and will work mutually to ensure that this business venture is a success. OBJECTIVES To satisfy our customers by our quality of production and services. To achieve a growth rate of 6-8% per annum. To cement our position in Large, Potential Domestic and International Market. To innovation of the product time to time for the development and Diversification to cater global needs. Elimination of Quota Restriction leads to greater Market Development and thus it will increase our productivity.. As Market has been gradually shifted towards Branded Readymade Garment, we target to be dynamic as per the market situation. To provide better quality at the best affordable price. To provide our customer every suitable place to buy our products like retail shop to malls from where they can easily purchase our products. To offer a range of packages and services specifically tailored to the needs of each customer We are expecting that this company will be successful and we believe that earnings will increase slightly for the second consecutive year and it will go on increasing. TO PROVIDE INTENSIVE SERVICE TO DECENTRALISED POWERLOOM SECTOR TO PROMOTE TECHNICAL TEXTILES IN INDIA TO CONTINUE ASSOCIATION WITH NATIONAL SECURITY PROJECTS TO DEVELOP HUMAN RESOURCES FOR TEXTILE INDUSTRY THROUGH EDUCATION TRAINING KEYS TO SUCCESS There are a few key factors that contributes to success or failure for professional worksmost of which twig from the importance of reputation to an entrepreneurs business. Our Services would be perfectly done by our managers, and other staff ,our actions would definitely be prompt and efficient. We maintain the best relationships with our staffs such as boss to subordinates, managers to employees and with all other like labourers, electricians and machanics. Although we are very good with others and we maintain our personal relations good but at same time we maintain a professional relation at all time. Our very important key to success is to execute the work according the planning, when it is suppose to and at the agreed and affordable price. The other key to success is to have a very good contact with our designer of our clothes. We have appointed the people who are very dedicated to their work and they supervise the production very effectively. Our production supervisor is to ensure that the jobs are to be finished in 15 hours must not exceed 20 hours. Profit goals are only be achieved when our tailors and stitchers work efficiently. CURRENT SITUATION Aggarwals textile industries has a reputation for making great clothing that have found overwhelming favour among the masses. Our Companys order book position is very good, both in the domestic market as well as exports, with orders for next 4-5 months, we are expecting about Rs7500 million in hand. There are also good amount of demands, which we expect to convert into orders. Every business passes through various cycles, good and difficult but It is only in the challenging environment that one learns the best lessons of life. Challenging time in past few years presented an opportunity to look into the business very closely, remove inefficiencies, rationalize expenditure (control costs) and look at alternate products markets. The environment has become quite encouraging for our textile companies. The following facts will prove that. In a country like India, the present situation has definitely created an advantage over Competing Countries. As there is an Appreciation in Chinese currency that resulted in increase in their labour cost.due to this they lose the cost advantage and competitiveness. Also the buyers of clothes are looking at viable alternate to China as they do not want any further risk. There are many uncertain economic conditions in the neighboring countries that upset customers confidence for timely delivery of their orders. Thus many countries shifted their orders to India and that is really a healthy sign for our business. This scenario has brought promising prospects for Our Textile Industry. Slowdown in USA and Europe has led to increase in demand for basic products as against products in the luxury segments. Discount stores like Wal-Mart have witnessed higher volumes. Our company has been traditionally catering to the medium and lower segment of the market, thus witnessing higher volumes. During March to August 2010, ready made garments worth $4.87 billion were exported from our textile industry, In rupee terms, the figures work out to Rs207.6 billion market of India as far as textile is concerned . It has many competitors but our products are the one which overshadows the performance of all other textile industries. The big reason of the success of the Aggarwals textile in India is that our products are very economical and light wearing. INDUSTRY ANALYSIS Aggarwals Textile Industry in India is Representing the rich Culture , Tradition Economic Prosperity of India .it is an self reliant industry and thus provide better quality clothing at affordable price It has a huge resource for Raw Material that helps industry to control costs and reduces the lead-time across the operation. Low Cost and Skilled Manpower also provide competitive advantage to industry. As we import different raw materials from different countries the large varieties of cotton fibers available and thus a fast growing synthetic fiber industry exists. India has great advantage in Spinning Sector and has a presence in all process of operation and value chain that help us to a great extent and keep us moving . Aggarwals is one of the largest exporters of Yarn in international market and contributes around 25% share of the global trade in Cotton Yarn. Our Industry is one of largest foreign revenue contributor and holds 12% of the countrys total export. Industry has large and diversified segments that provide wide variety of products Arvind Mills Welspun Group Raymond Alok Industries Madura Garments Large Composite Textile/ Apparel/Made-ups/Garment Manufacturers Ashima Group Reliance Industries Garden Silk Mills Mafatlal Industries Composite Units/ Fibres Filaments manufacturers Surat is the countrys strongest base for non cotton fabrics. Surat Ahmedabad is the leading manufacturer of cotton and blended textile. It is also one of the largest producer of denim in the world. Government has taken active steps to develop Apparel Park for overall growth of textile sector. Ahmedabad DESCRIPTION OF THE PROJECT . We not only sale our products but we also provide services to our customers. We provide free service to our customers. By the opening of our showroom, many people got employments such as: Managers who manages the work of the company. Account Manager who manages the account office such monetary works. Mechanics for maintaining the performance of the cars. Electricians just for electrical sorts of works related to vehicles. We also require few girls who capable of handling our customers as a receptionist. At last our Indian government is also get benefited as we pay huge amount of tax. The growth opportunities exist in following areas: Medical textiles Construction textiles Packaging textiles Baby diapers Home textiles( with fire-retarded fabric) Blankets and Traveling rugs Bed, tale, toilet and kitchen linen Curtains, drapes, interior blinds Furnishing articles Sacks and bags Tarpaulin, sail, tent, camping goods OPERATIONAL AND PRODUCTION PLANS Operationl n production plan Engraving Systems Laser engraving cutting edge technology Conventional engraving systems specialized equipment CAD systems modular software Printing systems Excellent performance Greatest colour range High reproducibility Total solutions Hotmelt laminating Coating finishing Double sided coating Foam processing Application testing facilities Dbfhd For nearly four decades weve worked with thousands of customers to develop a broad range of automatic cutting systems that ensure optimum cut part quality. To date we have installed more than 7,000 cutting systems in operations throughout the world. Dbfhd Drape 2-dimensional patterns on 3-dimensional life forms Simulate fabric and texture data Collaborate via the internet with clients and suppliers Reduce the number of physical samples required Drastically decrease product development and approval times Services to customers(strategy) The prime driver for businesses is the savings, which lead to lower costs while maintaining high quality; or to put it another way to lower per unit costs while maintaining high quality, which ultimately, leads to savings (same for less or more for less). But, in essence it is due to a combination of factors, such as high levels of education and skills appropriate to the tasks outsourced The Operational Plan describes the requirements to conduct the annual strategies at the Ganu Hyundai. All the events have an element of public risk and potential for environmental impact. The Operational Plan has been pile up with due consideration to reduce these risks and to prescribe the tasks required to conduct a good relationship with the customers. Our operational plans also include sale of the products per year and benefits comes out of that. The Ganu Hyundai performs its operations by the following manner:- Firstly, the customer has to book the desired model of the car. They can book or give order either by phone or by directly coming to our office which in South Extension, New Delhi or they can order online by just going to our website i.e. www.ghyundai.com We also have servicing centre where we provide free servicing to the customer who are new (means whose car is less than one year). We accept money either by cash or by cheque or by card. We also have collaboration with few banks that provide loans to customer. Hyundai backed warranty for 1 year 20,000kms. We assured with company backed operations. PRODUCTION PLANS The following are the Production plans of our consultancy:- As per regarding the production its very important to satisfy our customers by providing them desired model and better service. The production plan of Hyundai is divided into three steps called as Product Life Cycle of Hyundai: GROWTH If consumer feels that this product is good and satisfactory for them, they automatically get attracted by that product, then the company (Aggarwals industry) will meet a rapid sales growth. Aggarwals textiles stands on improved Stage. As the sales of another textiles are higher as compare to that of Aggarwals then the customer will buy our product ,by providing them great benefits in future and they will accept it. Revenue à ¢Ã¢â‚¬Å¡Ã‚ ¬ 188 million EBIT à ¢Ã¢â‚¬Å¡Ã‚ ¬ 19 million Capital employed à ¢Ã¢â‚¬Å¡Ã‚ ¬ 53 million Employees 1.322 MATURITY Rapid sales growth cannot last for a long time. Sales slow down as the product sales reach peak as it has been accepted by most buyers. DECLINE Sales and profits start to decline, the Ganu Hyundai may try to change their pricing strategy to simulate growth, and however the product will either have to be re-modified or replaced within the market. MARKETING PLAN Marketing the marketing mix is: Right product Right price In the right place Using the most suitable promotion Packaging Labels Industrial applications Security applications Wall-covering Proofing Our marketing plan is to establish a well-regarded brand name linked to a meaningful positioning. We will have to invest heavily in market to create a distinctive brand image projecting innovation, quality and value. We also measure awareness and response so we can adjust our market efforts if required. Target Markets Our marketing strategy is differentiated marketing. Our primary customer target is middle to upper income that need true value for their money and comfortable ride in city conditions. Our secondary customer target is college students who need style and speed. Our primary business target is mid- sized to large-sized corporate that need to help their managers and employees by providing them a car for ease of transport. Our secondary business target is entrepreneurs and small business owners who need to provide discounts to managers buying a new car. Promotion Road Shows The showroom plan to stage and road show, to display vehicles in the pavilions during various college festival and exhibition. This type of car will appeal to youngsters more. Television Advertisements Advertisements to promote and market our product will be shown on leading television channels, as for example- Zee, Star, Sony etc. Banners Hoarding banners and neon signs will be displayed at clubs, discs, outside theatre and shops to promote our brand car. HUMAN RESOURCE PLAN Strategies for success Smart and Modern Materials Technological research involving scientists and textile designers working together has resulted in the development and productions of a range of new fibres and fabrics which have become known as Smart and Modern Materials. Types of Smart and Modern Materials Encapsulation is the technology of enclosing a smell or substances within a fabric to create a particular effect. Sense and React Materials are smart materials that have been specifically designed to respond to the needs of the wearer and/or of the environment. Photo-chromatic Dyes change colour in response to a particular temperature. Reflective Inks reflect any available light making a garment more visible in the dark. Phosphorescent Dyes appear to glow in the dark. Micro-Encapsulation is the application of microscopic capsules to either a yarn or the surface of a fabric. Abrasion is the scraping or wearing away of something. Interactive Textiles are touch and pressure-sensitive fabrics incorporating conductive fibres. Geotextiles are bonded or woven man-made and natural fabrics that can be made from polypropelene fibres. . . Abrasion Resistance Pilling Colorfastness Dimensional Change Flammability Wrinkle Soil Resistance Tensile Properties Fabric Appearance Hand Eight cameras,Four laser light sources,Collects 300,000 data points in 12 seconds,Results in 3D image,Results in a set of over 80 body measurementsAfter the scan is completed, four views are available to examine simultaneously marcell Measures the amount of heat emitted from an object or person . Temperature measurements are used to redesign apparel when heat is an issue, such as athletic or cold weather wear Garments can be tested in a variety of different environmental conditions,Temperature ranges from -20F to 200F,Humidity ranges from 5% to 95% chamber set up software including computer-aided-design cadlab1 The Advanced CAD class collaborated with Brooks Brothers to develop a Web site that would allow for customization of womens professional apparel. Designs were produced using U4ia and Illustrator that could have interchangeable fabrics, colors and styles Nxt headingà ¢Ã¢â€š ¬Ã‚ ¦. Mkting Annually, our students produce a professional level fashion presentation and exhibition of original apparel designs to an audience of over 1300 in Finch on CMUs campus. Ganu Hyundai is a unique Human Capital Management car showroom that enables the process of acquiring talent, aligning them with organizations goals and leading the transformation, to help your organization take that leap in performance. From automating routine tasks, to generating strategic reports, to giving access to employee related information through self-service, Ganu Hyundai does it all. Our key Modules include Performance Management, Training Development, and recruitment, HR Workgroup and Report/Analytics, Payroll, Self-Service. Followings are the Human Resource Strategies of Ganu Hyundai. They are:- Aggarwal textiles has employed many people to its industry and they have also been provided a special training. Our employees are getting knowledge and skills about clothing and they are getting paid according to their talent and hard work. ALL of our students have the opportunity to complete an internship with leading firms in the apparel design, merchandising, manufacturing or textile industries DKNY ,The Gap ,Nordstroms ,The Buckle ,Old Navy ,As Ice ALL of our students complete a sequence of textile courses that include textile product analysis and textile testing utilizing standard methods in an actual textile testing laboratory As about the Manager and Account manager, they get higher salary than the other emploes as their work is a little more different and difficult too,they have to look after their junior employees. Lower level employees those are new to this industry get less salary as they do not have the proper degree but as soon as they get their dgree their salary would automatically raise. The main assumption that come from these plan is that our company not only recruit a person who has a degree for it but also we provide a good and free training to poor poeple so any one having dadicaion to his work and life can join in our company. We also have a suggestion box, and organize monthly meetings to follow up tasks. ASSESSMENT OF RISK By doing the assessment of risk we are in a position to identify hazards that could cause damage to our textile industry. our assessment of risk makes us enable to know the hurdles and adapt measures accordingly to avoid or control risks Risk assessment would be recorded by the person who are assigned for it. Risk assessment of upcoming events are distributed among different person of different groups and it would be done when we gather all the information from the contractor, other companies It will also be a part of our risk assessment to built a personal contact with our customers so that we would be updated with teir new demands and thus can satisfy them. What are the risks? Indian Textile Industry is highly Fragmented Industry. Industry is highly dependent on Cotton. Lower Productivity in various segments. There is Declining in Mill Segment. Lack of Technological Development that affect the productivity and other activities in whole value chain. Infrastructural Bottlenecks and Efficiency such as, Transaction Time at Ports and transportation Time. Unfavorable labor Laws. Lack of Trade Membership, which restrict to tap other potential market. Lacking to generate Economies of Scale. Competition from other developing countries, especially China. Continuous Quality Improvement is need of the hour as there are different demand patterns all over the world. Elimination of Quota system will lead to fluctuations in Export Demand. Threat for Traditional Market for Powerloom and Handloom Products and forcing them for product diversification. eographical Disadvantages. International labor and Environmental Laws. To balance the demand and supply. To make balance between price and quality. Higher Indirect Taxes, Power and Interest Rates Another major risks Threat of new entrants Threat of substitutes Competitive rivalry The second reason of risk is fluctuation in the share market. The one of the major risk is demand in the market, if the demand of people will not fulfilled by our company then the people will move to the next textile company; this will again cause loss to the owner. FINANCIAL PLAN Financial planning is a process of setting objectives, assessing assets and resources, estimating future financial needs, and making plans to achieve monetary goals. Many elements may be involved in financial planning, including investing, asset allocation, and risk management. Tax, retirement, and estate planning are typically included as well. The following are the financial plan of Aggarwal textiles. They are: We invested nearly 1 crore rupees in the establishment of our project. We also have shares in the share market which will give financial strength in the market. We also have future plan to increase our company to 5%-6% per year. We also give discounts and other attraction to our customers in the off season to increase our income. We also give guarantee on our products so that we would be able to build a good impression on their mind. We have provided replacement facility too. The marketing research and tailored marketing strategy described in this business plan will result in  healthy profits, increasing  every year. It is estimated that by year 2015, revenues will reflect an 10% market share of the local market. Monthly break-even is very achievable. Total production at the time of this writing was approximately 70 units, which will increase to 100 by the end of the year 2015. Because it is the policy of the company to provide the fabric for the soft window treatment products, the company has a very low cost of goods sold account and therefore a high gross margin. Furthermore, the custom nature of the business means that there is  minimal inventory cost and accounts payable. Finally, the company does not posess any debt or long term capital assets that would affect the cash flow. With the ability to generate so much cash flow, it is assumed that the company will seek to use this asset to expand its markets and production capacity in the near future For our financial plan we consulted with our parents, friends and seeked many sources from where we could get the informations.after all we decided to invest in which we contributed 50% each in which we got helped by our parents and our relatives.our contribution included our savings of the past which we saved for this day and it was of great help.