History of Ammar Textile Limited

Ammar textiles limited were incorporated in September 1981 and Mr. Bilal was the first Managing Director of it. With the help of textile engineer Mr. Tom Tongue and Ms. Zina Roworth, A British designer Mr. Bilal select various knitting, dyeing and finishing machines. Meanwhile for success Mr. Bilal invest on their employees, Mr. Yasir Waheed was selected for this project and he obtained degree of Textile Designing from UK. Mr. Tom Tongue worked with Ammar Textile on a contract for two years as General Manager of Production. During this period he helped Mr. Bilal in training of employees as well as preparing designs for first domestic market offer. Keeping the trend of Quality Conscious People Ammar Textiles Company Limited target their Market upper class of Society but there is a threat from strong brands in market with verity of product and heavy advertisement like Omega, Bonanza and Oxford. With vigorous advertisement approach, Ammar Textile use the electronic media. i.e (Pakistan Television PTV) and print media they launched their first summer collection in June 1983. But unfortunately the product was failed to gain the trust of public due fabric color. In 1984 Ammar Textile name was established as a producer of good quality textile products, on the bases of their good quality they are offered their products for export but management declined by saying that they want to stable first before exports. In the end of 1984when Mr. Yasir return, the idea of exports was once again came into mind at that time some well establish competitors were already exporting their products to Europe. By maintaining strict employee training the become able to meet British Textile Standards. By the mid of 1985 (ATL) gain the trust of international market as they just get samples to manufacture according to these, for smooth running of Export Operations Individuals were hired form the market.

In 1985, they received a letter from the vice president of Harper Industries saying that they were interested in doing business with ATL. A Meeting of top management was called so as to discuss various issues and concerns regarding Pricing, Shipment and Capacity utilization in this regard.

Strategies used in this Case Study

In this case study corporate level strategy is used Corporate level strategies Managers at the top level of the organization are responsible for corporate level strategies Types of Corporate Strategies There are three main categories of corporate strategies, growth, stability & renewal. First of all Stability Strategy is used, as Ammar Textiles limited wanted to get on a firm footing before taking up exports. This phase of stability is of long period. After becoming stable, Ammar textiles limited moves towards Renewal Strategy. Renewal Strategies The decision of exporting goods turned the ATL strategy towards renewal strategy. Turnaround: Addressing critical long-term performance problems through the use of strong cost elimination measures and large-scale organizational restructuring solutions. This is used when the organizational problems are more serious and critical After Renewal strategy, Ammar textiles limited move towards Growth Strategy. Growth Strategies A strategy that seeks to increase the organizations business by expanding the number of products offered or market served. By pursuing the growth strategy, the organization may increase sales revenues, employees, market share. In Growth Strategy, Concentration is adopted.

Concentration: Focusing on a primary line of business and increasing the number of products offered or markets served.

Questions of the Case Study

Q.1. Do the SWOT analysis of this Case Study Strengths i. Hiring of professionals from abroad, those who have a vast experience in textile industry to get strong position. ii. Emphasis on employee training & development and giving them opportunity to study abroad and get higher education according to work requirements and demands iii. By Training of local employees Ammar Textiles can now compete with international competitors and British Institute of Textiles Standards any time. iv. Due to intensive market Research and Development efforts, the product quality and price was fine tuned and distribution system was also streamlined. v. By using the latest technology in machines, they were able to fulfill the orders satisfactorily which gave them an edge over their competitors. vi. Target market middle and upper middle class, mostly youngsters who are college students both boys and girls as well as who prefer better quality. vii. Egyptian cotton was used in the summer collection which was rated as of the highest quality by the customers. viii. Due to Lower Labor Cost in Pakistan, they can price their products 10% to 30% below their International competitors. ix. Cost affective availability of high quality Cotton and Raw material in Pakistan provides Ammar Textiles Ltd with an advantage over its international competitors. x. Fashion shows and presentations to potential buyers were arranged in New York. xi. International quality packing, documentation and other formalities of exporting business were learnt to which other organization does not give importance. xii. Being Quality conscious AMMAR Textiles Limited earned a good name in the production of good quality of fashion wear only in 2 years of its incorporation.

Weakness i. In start prices were high due to the wrong estimation of the buying power of their target market as a result prices were cut down to 40%. ii. Colors of the products offered in the first summer collection, were not fast and tended to bleed. iii. External weakness is that all over the Pakistan there is weak link in production and quality control. iv. Capacity constraints

Opportunities i. Both Domestic and International Market have a strong demand of high quality Knitwear products from Pakistan. ii. iii. iv. v. vi. Consistency in Product Quality Assurance of Technical competency Reliability in Timely delivery Launching of products International market Successful meeting with the VP of Harper Industries can take Ammar Textiles Ltd. to new heights. Threats i. ii. Other brands in market were doing heavy advertisement. Omega, Bonanza, Oxford had many times higher turnover as compared to Ammar. iii. iv. v. vi. vii. Other Brands had a well established distribution system. Competition with international competitors/market Shortage of Time and logistics problems Pricing issue as compared to Hong Kong, Italy or Spain Shipment and Capacity utilization issues