Colony Textile Mills Ltd

Week 1 st

INTRODUCITON

EXECUTIVE SUMMARY
This report is based on the activities performed during the internship at COLONY Textile Mills Limited. Internship provided practical no!ledge of !or ing in professional environment. This learning experience is described in detail n the various sections of this report.

In the beginning " there is some detail about the compan#. The histor# and present status of the compan# is explained. The organi$ation structure and the details of its management along !ith its location are also discussed. I have also discussed the #arn manufacturing procedure and the important departments of the compan#. I have discussed some business operations and some strategies as !ell.

Then I collected information about the activities that I performed during the internship. I !or ed as an internee mainl# in %ccounts and Mar eting department. &o!ever" I also spent some time in 'urchase (epartment to gather some information about their !or ing.

In the end is the recommendations.

History of Textile In
Internship )eport

!kist!n

Colony Textile Mills Ltd

The subcontinent is the inheritor of one of the richest and oldest textile traditions in the !orld. +xcavations at Mohen,o (aro and &arappa *-../ 1-.. 0C revealed that the inhabitants of the Indus 1alle# cultivated cotton. 2ir 3ohn Marshall" the archaeologist has stated that a fe! minute scraps of cotton !ere found adhering to the side of a silver vase. Cla# and faience spindles !horls indicate that cotton and !oolen fibers !ere spun. % !ell/e4uipped d#ers5 !or shop !as excavated at Mohen,o (aro and the fragment of cloth indicates that !oven cotton cloth !as d#ed !ith madder root. Independence from the 0ritish in 1678 and the division of the Indian subcontinent into 'a istan and India started a ne! era for textiles production. 'a istan consisted of t!o entities" east and 9est 'a istan. The 9est !as the cotton producing area and the +ast !as responsible for ,ute production. %t the time of partition" 'a istan had no industrial base and inherited onl# one textile mill" the L#allpur Cotton Mill in L#allpur :no! called ;aisalabad<. This mill produced #arn and gra# cloth and no printed fabrics. =nder the Open >eneral Licensing :O>L< scheme" the business communit# imported plants and machiner# !ith cash dollars. In 16-." %dam,ee Mills !as set up in ?arachi" ?ohinoor in ;aisalabad" Colony Textile Mills in M"lt!n " Nishat and Crescent Textile in ;aisalabad. These !ere follo!ed b# >ul %hmed Textile Mills" %l/?aram" 1ali a" 2tar and )ashid textile mills. 9ithin a decade the ne! countr# of 'a istan !as self/sufficient in cotton and began exporting gra# cloth and later cotton #arn. 'a istan started exporting printed fabrics in the late 168.5s to %frica and b# mid @.5s !as sending printed material to +urope. 'a istan5s location !as ideal" as it la# half!a# bet!een the !estern !orld and the ;ar +ast. 'a istan has a *@ percent share in !orld export of cotton #arn and a A percent share in !orld export of cotton cloth. It !as in the A.s that the po!er loom too over and b# the 8.s gra# cloth !as being exported at thro!a!a# prices. There are about *.."... po!er looms operating in 'a istan some of !hich are bac #ard operations. &andloom" !hich formed the bac bone of textile goods in the last centur#" is no! almost non/existent" its sales confined to a fast diminishing rural mar et and a ver# small niche mar et. %lthough 'a istan is the !orld5s fourth largest cotton gro!ing nation in the !orld" after the =nited 2tates" China" and India" its total turnover for export is onl# B - billion. Textile goods form A. C of the total exports of the countr#. The commodities exported are #arn" cloth" tents" and canvas" bags" to!els" bed linen" garments" s#nthetic textiles and other made ups. 9ith a large and expanding textile industr#" textile education and training became imperative. The Textile =niversit# of 'a istan !as established in

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Colony Textile Mills Ltd

?arachi to train technical and management professionals. The Textile =niversit# a!ards degrees in Textile 2ciences and Textile Management. The National College of %rts in Lahore and the Indus 1alle# 2chool of %rt and %rchitecture in ?arachi are the onl# t!o institutions in 'a istan" !hich a!ard a degree in the discipline of Textile (esign. (esigners are being absorbed into the industr#" bringing about change and vibranc#" !ith innovations in 'rint design and !eaving. Toda# there are 7-. 2pinning mills and D- composite textile mills. Textile goods form A. C of the total exports of 'a istan.

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Colony Textile Mills Ltd

COM ANY HISTORY

Colon# group has been the pioneer of textile industr# b# setting up Colon# Textile Mills Limited ECTMLF after partition of the sub continent in 16-." thus CTML became one of the first textile mills to be registered as public limited compan# and 4uoted in ?arachi 2toc +xchange E?2+F. ;oundation of the group !as ept over a small flour milling operation" !hich rapidl# gre! into cotton ginning that evolved into the core business of the group" constituting *1 cotton ginners spread throughout the cotton gro!n belt in the province of 'un,ab / 'a istan. The logical vertical process/integration paved its path for the group to invest in to Textile 2pinning. The ground brea ing of the 2pinning facilit# !as the beginning of huge investments that follo!ed !hich gave the group a leading position in the Textile Industr# of the Countr#. Colon# Textile soon became one of the largest verticall# integrated textile facilities in the countr#. The group further diversified in to 'o!er >eneration and (istribution net!or " 0an ing" Insurance" and Cement sectors. The success of the group continued until the government regime shift brought about a shift in polic# from private sector pushed industriali$ation to a strong !ave of nationali$ation. The >inning" ;lour Milling" 'o!er" 0an ing" Insurance and Cement along !ith various other sectors !ere completel# ta en over b# the government. &aving ma,or assets nationali$ed" the >roup !as faced !ith severe financial difficulties for almost one and a half decades. 'resentl#" the Colon# >roup consists of several Textile 2pinning facilities !ith an installed capacit# in excess of **."... spindles out of !hich more than *.."... spindles are 7 #ears old or less.

Colon# group is managing the follo!ing companiesG

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Colony Textile Mills Ltd

%ine of &"siness St!t"s

'ublic Limited Compan#

Co#$!ny N!#e
Colon# Limited Textile Mills

Textile E2pinningF

Colon# Industries E'vt.F Textile E2pinning Limited 9eavingF

'rivate Limited Compan#

C olony Textile Mills %i#ite' (CTM%)

Colon# Textile Mills Limited" one of the group companies of the Colon# >roup" is a Textile Manufacturing unit established as on *7th

%ugust" 167A and engaged in manufacturing of #arns of various Ne Counts. The compan# has authori$ed capital of )s. 711"..."... as on 2eptember D.th *.1.
(uring #ear *..6 to *.1. the annual production capacit# of the compan# !as D7.@1D million ?g5s converted into *. Ne Count based on 111"1DA spindles. Currentl# the number of spindles installed has been increased to over 18-"... spindles. % summar# of the compan#5s production record for spinning section for the past three #ears is given under

Y e ! r en ' e' *+t, S e$ te#- er

.++/

.+1+

.+11

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Colony Textile Mills Ltd

A
-6 "* .. 78 ". @18 "8 8@ ". .. 1 ".6 * 17 "A -* "A @. @* .. .C 86" @A 7 A7" 16 **" @7 1" .. * 1". 7. 1@" 8. D" D8 @ @*. .. C 188 "7 7@ 1-- "D D. 7@ "A A6 "1 11 ".6 78 "D 67 "7 7A 68 .D @C

No. of spi n dl es i ns t al l ed %vera ge no . of spi nd l es !or ed C apa ci t# at *. cou nt E? g5s .F No. of sh i ft s !or ed %ct ua l p roduct io n conver t ed at *. cou nt C apa ci t# =t i l i $ a t i o n

The compan# sales are comprised of local sales !hich is almost 1..C against advance cash pa#ment. The total turnover of the compan# during last #ear !as )s. D.**A 0illion !hich is expected to cross -... 0illion mar during the current #ear.

Vision St!te#ent

I % ttain highest standards of 4ualit# in its all business Internship )eport

Colony Textile Mills Ltd

activities.
I 2 ustained gro!th in real terms. I & ave professionall# trained high 4ualit# motivated

!or force" !or ing as a team in all environments.

I % ttain past glorious position and be recogni$ed

locall# as !ell as internationall# as a d#namic" 4ualit# conscious and progressive compan# and industr# leader.

Mission St!te#ent
To manufacture 4ualit# products for customer satisfaction through
&onoring the commitment. Continuous endeavor for improvement through

adoption of most modern technolog# in production.

2trict adherence to 4ualit# control. (eveloping a sense of high reliabilit# through

fair dealing.
0ecoming a part of countr#5s development and

economic prosperit#.

0ro"$ M!n!1e#ent

rofile

% brief profile of the main directors of the compan# !hich hold ma,orit# of the shareholding is given belo!G

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Colony Textile Mills Ltd

MR2 MU0HIS A2 SHEI3H Mr. Mughis %. 2hei h is the Chairman of Colon# Textile Mills Limited. MR2 4AREED M2 SHEI3H Mr. ;areed M. 2hei h is the Chief +xecutive of Colon# Textile Mills Limited. MR2 NAVEED M2 SHEI3H Mr. Naveed M. 2hei h is C+O and director of Colon# 9eaving Mills E'vt.F Limited.

Re1istere' Offi5e

M. Ismail %i!an/e/2cience 2hahrah/i/3alaluddin )oomi" ;ero$epur )oad Lahore J -7A.. 'honeG E.7*F -8-@68. J * ;axG E.7*F -8AD*78

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Colony Textile Mills Ltd

%E0A% 4ORMATION 6 STRUCTURE

Colon# >roup5s structure is a h#brid of divisional and functional structuresK divisions are based on t!o products Yarn E2pinning ;acilit#F and >re# ;abric

E9eaving ;acilit#F.

o7er 0ener!tion 6 He!t Re5o8ery Syste# Colon# 9eaving Mills is full#/contained and self/sufficient facilit# !ith its in/house continuous and reliable po!er generation facilit# !ith 1..C bac up po!er arrangement. The 'o!er >eneration department !ith its &eat )ecover 2#stem is designed to generate enough hot !ater to fire the chilling s#stem for the entire facilit#" along !ith producing more than -.C of the steam re4uired for the si$ing operation.

Me#-ers,i$s
Lahore

Chamber of Commerce Industries MILL2 %22OCI%TIONF.

%'TM% E%ll '%?I2T%N T+LTIL+

OR0ANI9ATIONA% CHART
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Colony Textile Mills Ltd

1.

C,!ir#!n

Dire5tors

C,ief Exe5"ti8e

Co#$!ny Se5ret!ry

I#$ort:Ex$ort M!n!1er

M!n!1er 4in!n5e

S!les M!n!1er

"r5,!se M!n!1er

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O&;ECTIVES O4 CO%ONY TEXTI%E

Colon# Textile Conduct 0usiness under follo!ing ob,ectivesG To carr# on the business of general manufactures and to manufactures" bu#" sell and deal in commodities" apparatus" machiner#" materials and articles of all inds. To carr# on the business of textile mills" spinning" !eaving" d#eing" bleaching" printing" merceri$ing and to erect all inds of other machiner# as re4uired in textile mills and bu# and sell all ra! materials as re4uired and sell manufactured goods" cotton" cotton #arn and cloth etc. To purchase ra! materials and machiner# as !hen it is re4uired b# the compan#. To carr# on business and install !oolen mills" !oolen #arn" !oolen cloth etc" and purchase machiner#" and spare parts as re4uired b# the compan#. To manufacture and carr# on business in different vegetable oils" cotton seed oil" rape seed oil" line seed" olive caster seed and their products and b#/products. To refine vegetable oil and to manufacture better substitutes and to carr# on business of ever# description in this line.

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Colony Textile Mills Ltd

1*

* N( 9++?

DE ARTMENTA% STRUCTURE
C,!ir#!n

Dire5tors

C,ief Exe5"ti8e

I#$ort:Ex$ort De$t2

M!rketin1 De$t2

4in!n5e De$t2

A55o"nts De$t2

"r5,!se De$t2

IT De$t2

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Colony Textile Mills Ltd

1D

INTRODUCTION
This department is run and controlled b# the purchase manager. One purchase assistant and one helper are also performing their duties in this department. This department ma es arrangements for the local purchases of machiner# H other items i.e. spare parts !hich are used in the repair of machiner#" electric goods" pac ing materials" oils and other general items including printing of stationar#. The commercial or purchase manager is responsible for reporting directl# to the purchase committee. The purchase incharge is responsible to !or for this department but ta e ver# much care in chec ing purchase orders. Comparative statements and re,ection are also prepared b# the assistant. The duties of helpers include the collection of 4uotations and dispatch of goods. >enerall# purchase department is concerned !ith purchase of ra! materials" machiner#" chemicals" tin plates" tin" cotton" !oolen" oils etc.

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O&;ECTIVES O4 DE ARTMENT
The follo!ing are the ob,ectives and functions of this departmentG/ To enter demands in demand register. To classif# the out stations demands and local demands. To collect 4uotation in4uiries. (ispatch the purchase orders. +nter goods !hen received in the challan boo . )ecording of approved rates of the goods in the relative register. (ispatch goods to the millMs staff !ith deliver# challan. To meets re4uirements of the urgent demands. To sends chec s to the selling parties approximatel# !ithin 1da#s. To eep records of all information about purchases and sale items in the concerned registers.

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1-

"r5,!se
De#!n' <"ot!tions 6 Ne1oti!tion

ro5e'"re

Co#$!rison 6 4in!li=!tion Deli8ery of 0oo's

A'8!n5e $!y#ent

&ills

Mill

Cre'it Ne1oti!tion A:C Se5tion C,e>"es Dis$!t5,e'

C!s,

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1A

URCHASE

ROCEDURE

9hen an# demand is raised at the mills" it is signed b# the purchase committee. 2imilarl# head office demand is signed b# the head of the department and these are sent to the purchase committee for approval. %fter approval" these are sent to the purchase office !here these demands are classified in to local and out station demands. The outstations demands include out of Multan or out of 'a istan. The demands out of 'a istan are sent to the head office. 0ig items such as tin plates" chemicals are purchased b# calling tenders and the lo!er tender is accepted. Other purchases li e oil" cotton seeds and chemicals are purchased b# collecting the rates from different bro ers and other related agencies and then concerned item is purchased. 9hen selling part# is approved purchase order is sent to that part#. 9hen goods are received at factor#" deliver# challan boo entr# is made. T!o copies are sent to the store incharge at mills. Most of the goods from local mar ets and out station are purchased on credit basis.

RE;ECTION O4

URCHASES

%ll the items purchased are sent to the perspective departments and are chec ed b# the head of the departments e.g. chemicals" Oils being demanded b# the production department. chec s those chemicals. If the item is up to standard then it is accepted b# preparing the 4ualit# report and sent to the commercial department. 2imilarl# all the cash purchases are sub,ect to the approval of 4ualit#. If goods li e chemicals are out of standard then re,ection report is made b# the chec ing department and sent to the purchase Then chief chemist

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department.

CASH

URCHASES

2ome goods are purchased on cash basis for the mill needed. In this case bill is received after ma ing the cash pa#ments and bill is stamped as NC%2& '%I(N. These purchases include office stationar# e4uipments" and some time repairing items.

&OO3S 6 RE0ISTERS WOR3IN0

2eparate ledgers are maintained for recording all sales and purchases items. 2tore spare parts. +lectric goods. >eneral goods. 'ac ing materials. Individual part# ledger. The follo!ing information is recorded in above registersG/ The date" name of items and department. (emand number. (ate of purchase. Name of part#. Ouantit# of items. )ates of purchase items.

* RD WEE3
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1@

ACCOUNTS DE ARTMENT
INTRODUCTION
Colon# Textile has separate account department under the control of chief %ccountant !ho is responsible for the financial affairs of the organi$ation and to eep control on all inflo!s and outflo!s of cash and funds. 2imilarl# he is responsible for tax affairs of the corporate affairs !hich are handed b# the secretar# of the compan#" Mr.I4bal. &is main assignment is to handle the shareholder and the 0oard of (irectorMs meetings. &e also prepares the %genda and papers of the meeting after this he prepares the minutes of the meetings of the 0oard of (irectors. A55o"nts De$!rt#ent2 o Chief %ccountant. o %ccountant. o %ssistant %ccountant. o Computer Operator.

O&;ECTIVES
To provide a permanent a s#stematic record of the business transactions. The periodicall# results as to profit and loss should be read# and accurate. To eep the financial data up to date so that it can be read# to sho! the higher management !henever demanded. To provide the media bet!een production and mar eting. It is useful for the future planning.

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To enable the trader to compare the different items such as sales" purchase" opening stoc and closing stoc of one period !ith similar items of proceeding periods. It is useful for preparing arithmetical accurac# of the transaction. To provide most reliable information about business. To provide correctness of the assets and liabilities.

4UNCTIONS O4 ACCOUNTS DE ARTMENT

The ma,or functions of accounts department are as underG/ Maintaining the record of the account receivable. )ecord of pa#ments b# ban . )ecord of pa#ments b# cash. Maintaining the record of ra! material purchased. Maintaining the record of sale of Yarn" !aste etc )ecord of store purchases. )ecord of insurance. )ecord of the expenses i.e." manufacturing and mar eting. )ecord of !ages and salaries. 'reparation of financial statements.

VOUCHERS
The ma,or vouchers !hich are prepared in the Colon# TextileG/ %d,usted 3ournal 1oucher.

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*.

Cash 'a#ment 1oucher. Cash )eceipt 1oucher. 0an 'a#ment 1oucher.

&OO3S
The follo!ing are the 0oo s" !hich are maintained b# the +nterpriseG Cash 0oo . >eneral Ledger. >eneral 3ournal. Local Customer Ledger. 0an 0oo . CASH &OO3 In Cash 0oo all cash transaction are entered. This boo has t!o sidesG/ 'a#ment 2ide. )eceipt 2ide. &AN3 &OO3 Most of the business is carried out through ban s. 2o this boo is maintained to record all the transaction occurred in the ban against the mill. It sho!s the inflo!s and outflo!s of the cash at the ban " in sub ledgers the posting is made dail#. 9e can see the ban balance of an# ban boo separate ban s. 0ENERA% ;OURNA% !ith !hich !e have an account from the ban at an# time because separate sheets have been allocated for

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Colony Textile Mills Ltd

*1

%ll in this boo

ind of dail# transactions occurred at the mill are recorded and then transactions are transferred to their concerning

ledgers against concerning accounts. 0ENERA% %ED0ER ;ollo!ing are to be maintained in the general ledgerG/ Cash )eceipt. 2onahri 0an Ltd. 'redential Commercial 0an Ltd. %s ari Commercial 0an Ltd. 'latinum 0an Ltd. Yarn sale 9aste sale Local sale parties 2ales tax +xport sale Yarn stoc Cash pa#ments 'rofit H Loss %ccount. ;rom disposal of assets. 'rofit H Loss %ccount. ;rom disposal of stores. ;inancial Charges.

;IN%NC+ 2+CTION
INTRODUCTION Internship )eport

Colony Textile Mills Ltd

**

This is the ma,or department of the compan#. This is located in Colon# Textile Mills Ltd head office. It prepares different ma ing purpose. ;inance department prepares the Income 2tatement" 0alance 2heet" Trial 0alance" Cash ;lo!" 'roduction report for the !hole month" stoc ta ing report" #ield comparison report etc. these all reports are useful for the management to ma e production plan" financing decision and other important matters. The head of this department is ;inance Manager. inds of financial reports and gives information to management for decision

O&;ECTIVES
;ollo!ing are the main ob,ective of finance departmentG To prepare monthl# and half #earl# reports To eep the record of inventor# and stoc To maintain a li4uid position To maintain ade4uate cash to run the operations of business To reconcile the ban statements To ma e pa#ments to the suppliers To deal !ith sale tax and income tax departments 'reparation of ban pa#ment and ban receipt vouchers 'repare profit and loss accounts and 0alance sheet ?eep record for the pa#ments of salaries

COM ONENTS O4 4INANCE DE ARTMENT

;inance department are consists on the follo!ing sectionsG 'a#able" Contraction 0an negotiation and reconciliation 2tore costing

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*D

+xcise %udit

AYA&%E? CONTRACTION
In this section usuall# pa#able is paid to the supplier of all goods including stationar#" maintenance goods" cement etc. 'a#able is made according to the contract and instruction of the C;O.

&AN3 NE0OTIATION AND RECONCI%IATION @

This section starts !or ing !hen documents reach from ban to head office. (ocuments are recorded in documents receipt register and in ban register. % report is given to the C;O on dail# basis about the customer and pa#ment date. &e ma es decision either to grant discount to him or not.

STORE COSTIN0
>oods receipt note" the store costing section receives the related bills. The# are chec ed against purchase order and 'erforma invoice in terms of 4uantit#" specification" price etc. %fter this" a ban pa#ment voucher is prepared and sent to this section" !hich issue the chec s to the related parties and posts in the ledger.

EXCISE
+xcise section deals !ith the outgoing products for issuance of >ate pass. This !or ing of excise section starts after sale" !hen loading program is received from export sale and local sale processing. %ccording to this program >ate pass is prepared and issued to the go/do!n eeper. %fter issuing a >ate pass" its details are recorded in the register and then sale invoice is prepared in !hich

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Colony Textile Mills Ltd

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actual value and sale tax value is mentioned.

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7 T& 9++?
MAR3ETIN0 STRATE0Y
CTML is a group starting from 16-.5s !hich means that it is an old and pioneers of Textile industr# in 'a istan. On its purchase side as I have !or ed for a !hole !ee in Yarn 'rocurement department of the >roup" !hich is a small branch of Mar eting department. I found their business to be such a vast that the# ordered their ra! material on telephones" the# made contracts !ith the ne! companies and those companies having alread# contracts had no need to made. The main !hich !ere dail# paid !ere mainl# to the ICI for pol#ester and then to companies li e Nishat" 2itara Textiles and man# more companies and groups li e that. Their fiber is ver# famous not onl# nationall# but internationall# as !ell. 2econdl# on +urope sector this group is ver# !ell no!n as the# purchase machiner# from them and then the# suppl# Methane to them" !hich is used in mixing !ith petrol. Though it is a b#/product of sugar sector #et it is branch of the same compan#. This is helpful for the Textile division too. The past #ear has been tough for the textile industr# as competition is increasing steadil# and margin of profit is becoming smaller da#/b#/da#. Our competitors from %sia have come up in a big !a# !ith lo!er prices resulting from lo!er overhead" cheaper and better ra! materials and machiner#. Countries li e China" Indonesia" India and 0angladesh pla#ed an active role in the fabric mar et. Improvement in 4ualit# and production capabilit# !as the main area of concentration. Mar et for Yarns and >re# fabrics !as diversified to increase the customer base and reduce dependenc# on the ;ar +ast. In this effort business !ith Mala#sia" ?orea" Tai!an" =? and 2outh %merica !as initiated in case of Yarns.

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*A

In case of >re# ;abric mar et business !as initiated in 2outh %frica" North %merica" 3apan" Ital#" ;rance" and 2ri Lan a etc. 'roduct range !as also increased to cater to the differing needs of the bu#ers. ;anc# and special items li e (obb# (esigns" 0edford Cords" and Caviar T!ills and stretch fabrics !ere developed !hich are being sold at premium prices. CTML has constantl# updated our machiner#" replacing old machines !ith ne! ones upgrading the existing set/up" leading to better efficiencies and 4ualit# products. Leaving behind the traditional !a# of doing business and in our ,ourne# to!ards excellent it has consistentl# expanded its bu#er base and explored the different mar ets around the !orld. ?eeping in vie! demand of the 9orld mar et" CTML pursued its strateg# of value addition and reducing the dependenc# on >re# ;abrics and >re# Yarn. &aving the foresight to assess that in coming #ear5s value addition !ill be the thing of the future" CTML !or ed to!ards the achievement of its goal of future increasing its capabilit# in value addition. The export of processed fabric and made/=ps has sho!n mar et improvement as compared to last #ear. It has placed us successfull# in the middle to upper end of the mar et. Our strength in +urope is the curtain division. This included #arn d#ed dobbies" engineered confections" different finishes and embellished products. The plan is to continue !ith this !inning strateg# and at the same time !e are tr#ing to find ne! clients in the high end. CTML is also exploring business opportunities in countries li e 2pain and ;rance !here CTML has ver# little business at the moment. North %merica is the star mar et for CTMLK it5s a ne! mar et for it after brea ing up the exclusive arrangement !ith our previous sale set/up. The 4uota is coming do!n in *..- and !e have started to prepare for it internall# as !ell as for the external environment. 0edding is the bul of the home textile business. CTML is in the process of updating its machiner# to cater the needs of the !ider !idth fabric re4uirement for =2% bedding business. CTML is also ta ing up the social accountabilit# issues ver# seriousl#" !hich are so dear to the %merican consumers. % lot of big brand =2 companies have visited us and are discussing the possibilities of a ,oint venture.

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The opportunities are limitless" !e have to revie! and anal#$e them ver# thoroughl# to associate !ith the right people in the long run. In shorter term !e are building a small amount of 4uota" !hich !ill give us recognition as a bedding supplier. CTML is ver# strong in non/4uota categories li e curtain and table linen. These categories are best served !ith ne! product development EN'(F. CTML !ill coordinate the effort for N'( b# all mar ets to optimi$e results. CTML has achieved the highest sales in 1666/*..* for North %merica mar et. On top CTML has developed more direct and closer relationship !ith its end customers. Oceanic has been our most lucrative and mature mar er. In business terms it is our Pcash co!Q mar et. 'rimaril# due to being a non/4uota mar et it had no real limitations in this mar et. (espite economic problems in that region" it has maintained our sales figures in the #ear under revie!. This mar et is a good design source for other mar ets" !hich is helping us to maintain our print volumes. Middle +ast mar et is composed of 2outh %frica and the ne! emerging mar ets li e the =%+" +g#pt" 2audi %rabia" and 3ordan etc. CTML has dedicated ne! staff !ith fresh energ# for the emerging mar et. The# have successfull# bro en the ground and !e have ver# strong faith that these mar ets !ill give us good volumes in the near future. 9e are also targeting printed apparel business for the first time. The latest addition is the most ambitious %pparel (#eing plant setup in )ai!ind Mill" !hich has started its production.

The effectiveness and productivit# of this plant !ill be further enhanced" as CTML moves to!ards becoming a more verticall# integrated organi$ation. CTML has increasing its profitabilit# b# !or ing efficientl#" procuring better ra! material and most importantl# ept a ver# close association !ith its customers. CTML has provided its staff !ith better !or ing environment and facilities" !hich enhances its efficienc# and output. %t CTML" it is prospering due to its professional commitment to!ards excellence and giving the best results at all times and against all odds. Its mar eting and production team co/ordinates all the time and its focus remains

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on maintaining its position as the mar et leader in the textile sector of 'a istan.

Co#$etiti8e Str!te1y
%s for as COLONY >roup is concerned its o!n name is its competitive advantage. 0eing an old group it has its o!n name in the field of Textile as !ell as sugar. %s I have told in the above segment that it has business of Methane gas in +urope it is its competitive advantage. %s dealing in one different side gives #ou edge over competitors in other field. ;urthermore" its financial assets are also an edge for the group. %s being late in pa#ing an# part# ma es future problems !hich result in deliver# of an# product to be late and resulting in bad image of the compan#. COLONY group bu#s ra! material from all the groups li e Nishat" 2itara Textiles" ?ohinoor Textiles and man# more companies li e that I cannot name all of them as it is a huge number. 9hich automaticall# ma es lin s better and !hich tells its mostl# products are exported. %nd for sure the# are of finest 4ualit#. It5s one competitor is the )upali group.

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- T& 9++?

IM'O)T %N( +L'O)T (+'%)TM+NT

INTRODUCTION
Import and export section has an important value for an# t#pe of business. This section helps to earn maximum for its o!ner. The compan# has the manager of export and import. The ImportRexport manager (r. Nafees I4bal is an asset of Colon# Textile limited. &e performs his dut# in different manners than others. There is a one assistant !or ing under the importRexport manager. The# perform all the activities of import and export !ith the help of top management.

EX ORT SECTION
+xport means the exchange of goods or products from inside countr# to an# foreign countr# !ith an# currenc# e4ual to the value of product or goods. There is the demand of Colon# Textile finished products all over the !orld. The# tr# to meet the demands of the !orld. The# also tr# to compete !ith Oualit# and on time deliver# in an# environment according to its respondents.

Colon# Textile exports its products in the follo!ing countriesK &!,r!in? D"-!i? Hon1 3on1? Unite' St!tes of A#eri5!? T"rkey? S$!in? 3ore!? It!ly? &!,r!in !n' Sin1!$ore et52 The# ex$ort the Cotton Y!rn? above mentioned countries. C Y!rn !n' Woolen Y!rn to the

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EX ORT 4UNCTIONS
The follo!ing are the main functions" !hich an export department performsG To build good relationship !ith the bu#ers. Co/ordination !ith the bu#ers and the production department. >etting orders from the bu#ers and tr# to fulfill them in time. Improve the 4ualit# of the product !ith the interaction of bu#er and the production department. 'repare and arrange the documents of export. 'repare the documents for the taxation and excise purpose.

O&;ECTIVES
;ollo!ing are the ob,ectives of export sectionG To survive in the !orld mar et. To earn foreign exchange for the development of the countr#. Increase the export to obtaining the optimum profit. +xport for the gro!th of the compan# as !ell as the countr#. To avail the opportunities the foreign mar et.

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EX ORT DOCUMENTS CONTAIN THE 4O%%OWIN0 THIN0S

+xporting of an# commodit# in the foreign mar et !as ver# complex and ris # in the past. 0ut no! the export documentation provides the securit# from different ris s. 9hen the goods are exported" a number of documents are to be prepared.

Contr!5t &ill of Ex5,!n1e In8oi5e

!5kin1 list

&ill of l!'in1 Co$y of %:C 4or# E Tr!ns$ort!tion 'o5"#ents

&I%% O4 %ADIN0
0ill of Lading is also the important document in export. Colon# Textile loads the products from 'ort of ?arachi. This document also includes the shipperRexporter address" Consignee Eto the order of ban F" port of loading" also port of discharge or place of deliver#" container S" detail of product" origin of countr# " purpose of export and gross !eight etc.

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4ORM EA
This form contains the follo!ing informationK 'lace and date of the issuing of letter !ith the name of ban . It also contains the description of goods !hich are going to be exported. Colon# Textile exports the cotton #arn " so the# !rites the t#pe of #arn as 1AR1 carded" 1..C cotton #arn or 'C #arn !ith the ratio A.G7.. %ctual 4uantit#" value of >oods in dealing currenc# and the contract No. is also the part of this form. Name and address of importer ban H 'ort of destination are also added in these t#pes of documents. %ll the above mentioned forms are the same but these are for different departments. %s the Ouadruplicate form + is for the custom purposes.

TRANS ORTATION DOCUMENTS

International trade involves the movement of goods from the !arehouse of the exporter to the !arehouse of the importer. There are several modes of transporting goods and the several t#pes of documentation involved in the transportation process. These are as follo!sG Mo'e 0# sea 0# road 0# rail 0# air C!rrier Truc ing Co. %irline Co. Tr!ns$ort 'o5"#ent 0ill of lading )oad !a# bill %ir !a# bill 2hipping Co.

)ail!a# service )ail!a# receiptRconsignment

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IM ORT SECTION
The basic definition of import is Pthe exchange of re4uired product or goods from foreign countr# b# giving mone# in an# currenc# e4ual to the value of goodsQ. The import section of Colon# Textile is !ell established and !or is being done in good manners according to rules and regulations. The manager of this department is responsible about his !or . The# import the follo!ingK chemicals" ra! material Epalm oil and other edible oilsF" 2o#a been seed" rape seed" cotton" 9ool" Textile machiner# and spare parts of textile machiner# etc. The# import the !ool from Ne!$ealand" palm oil from Indonesia H Mala#sia and seed and tallo! from all over the !orld as ;rance and %ustralia etc. The I#$ort 'o5"#ents include the follo!ing attached materialG %!ter of 5re'it for#2 Co$y of 5ontr!5t2 Ins"r!n5e 5o8er note2 Ter#s !n' 5on'itions &ill of entry

%ATER O4 CREDIT
Letter of credit is the guarantee of 0an !hich provides

securit# to importer in the business !ith exporter. LRC opens the ban for the importer after the re4uest of importer. 0ut no!ada#s the situation is completel# change because no! the ban tries to compete !ith other ban s so" the# tr# to contact !ith the responsible persons of organi$ation for the opening of LRC. The importer gives the negotiable amount to ban due to the reason of this facilit# provided

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b# ban

!hich is bet!een *C to 7Cof total amount of mone#. The

importer is responsible to pa# the charges !hich occur in his countr# and the exporter pa#s the freight in and other charges !hich occur in his countr# after the time of agreement. The exporter also pa#s the negotiable amount to ban ban . 0an opens the LRC in t!o termsG 1) .) Hy$ot,e5!tion le'1e !hich has the contact !ith the importer

HY OTHECATION
&#pothecation is the term in !hich the ban of ban provides the !hen the

facilit# to importer during the procedure of import. This is the trust on importer. The importer pa#s the mone# to ban imports material comes at port of his countr#. On the other hand" if the importer part# is ne! or having a small business or not !ell reputed then the ban receives the half amount of total value of LRC.

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B TH WEE3

Quality Control
Oualit# is a standard achieved b# processes to render a defect free product to the customer. Oualit# control is a s#stem implemented to ma e these processes successful. (ifferent 4ualit# control s#stems are as follo! ;eeding inspection 2even to $ero s#stem Traffic control s#stem - part tic et s#stem Clipping Inspection +nd line inspection ;inal inspection 2pecs inspection 'resentation inspection 'ac ing inspection Role of <"!lity ControlA C In parallel to cutting 4ualit# control !or s. There are in line supervisor in cutting department !ho audits the bundles. Match moc /ups and find faults. The# count the pieces" 1..C pieces are counted and *.C pieces are audit. If the pieces are not up to the specifications the# are re,ected. If the pieces are O approved and send to induction department. the# are

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iii)

%!-or!tory Tests for 4!-ri5 <"!lityA C Certain lab tests are used in Colon# Textile Mills Ltd for the chec ing of fabric 4ualit#. These are follo!ingG / iF iiF iiiF ivF vF viF viiF 2hrin age Test >.2.M. Tests 9idth 2tretch Test. '& scale Test Croo ing Test. 0leeding Test 2corching Test

<"!lity Ass"r!n5e De$!rt#entAC

'reventive measures ta en to ma e defect free product. )esponsibilities of 4ualit# assuranceG There are three responsibilities of 4ualit# assurance. E1F E*F EDF Monitoring the s#stem evaluating staff involved assuring 4ualit# of product

Corrective and Preventive Actions: The corrective and preventive actions are ver# strong in Colon# Textile Mills Ltd.2trong preventive actions are

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designed to ensure the 4ualit# and avoid an# ind of fault. 0ut if an# thing goes !rong then relevant person immediatel# ta e corrective action. 1G 'reventive %ctionsG aF ;abric %udit bF Cutting %udit cF dF eF fF Inline %udit Measurement %udit ;inishing %udit ;inal >ood %udit

Corrective %ctionsG aF bF 9arnings (emotions

Ho7 'o T,ey M!int!in <"!lity 4!5torsD Colon# Textile Mills Ltd has documented a 4ualit# manual that states the 4ualit# management s#stem of the organi$ation. Management establishes a documented 4ualit# plan setting out the specific 4ualit# practice" resources re4uired and the se4uence of activities relevant to particular product. M!in O-Ee5ti8e of <"!lity Ass"r!n5e De$!rt#entAC The main ob,ective of the 4ualit# assurance departments is

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to ensure the 4ualit# of finished products according to the customer5s specification. i) Role of <"!lity Ass"r!n5e Oualit# assurance department5s first responsibilit# is to chec the 4ualit# of finished products. ;or this purpose 4ualit# audit is conducted. In !hich the finished garments are chec ed according to customers '.O. ;abric. Oualit#" Color" 2i$es" %ccessories" +mbroider#" 2titching Oualit# ever# thing is chec ed b# Oualit# %ssurance (epartment. If ever# thing is O? then the shipment is approval other!ise it is re,ected. 0ecause 4ualit# polic# of Colon# Textile Mills Ltd is to satisf# customer at ever# cost. 9hile auditing finished goods O.% Officer also chec s the measurements of the garments and tallies them !ith standard measurements for the respective si$es. In final inspection the officer have a standard fault form. &e chec s the garment and find faults. If the fault ratio is more then *.-C he re,ected the piece. The department also gives cash a!ards to best performers. %nd a 4ualit# troph# is also given to best unit. 4or7!r'in1 De$!rt#entA Organi$e the safe and efficient movement of goods through different mode of transportation. 9e use the most effective and economical methods of transport for goods that might be the services of shipping lines" airlines or road and rail freight operators.

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The for!arding department pla# ver# important role for shipment of garment to various countries !ith using of man# documentation. The# use container to transfer of garments li e *.ft" 7.ft and 7. ft &C. The# use the follo!ing formulas to calculate the C0M. L T 9 T &R A1.*D T No. of cotton ;or air. L T 9 T &R DAA T No. of cotton LUlength 9U!idth &Uheight 4"n5tions of for7!r'in12 )esearch and planning of appropriate route for shipment Obtaining" chec ing and preparing documentation to meet customs and insurance re4uirements. %rranging air transport for urgent basis. 9or ing closel# !ith customer and third parties to insure smooth operations to deadlines. Maintaining current no!ledge of relevant legislation" political situation and other factors that could be affected. Transmitting data b# internet and tracing of shipment

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Mo'e of tr!ns$ort!tion G )oad transportation )ail transportation %ir transportation 2ea transportation Do5"#entsA &ill of le!'in1 % document that establishes the terms of a contract bet!een a shipper and transportation compan#. The follo!ing heads includesK o 2hipper name o Consignee o Notif# part# o +xport reference numbers o %gent5s name o 1essel number o 'ort of discharge o 'lace of deliver# o ;inal destination o (escription of goods Air 7!y -illF %n air !a# bill is a documentar# proof of the contract of carriage bet!een the shipper and the carrier. It includes the follo!ing heads o 2upplier name

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o Consignee o ;orm export number o Invoice number o Notif# part# o %irport of discharge o %irport of receipt o %irport of loading o (escription of goods o >ross Rnet !eight o L.C number Co##er5i!l in8oi5eA The commercial invoice made b# the for!arding department !hich go to the bu#er of products. It includes the follo!ing heads o Invoice number o 2hipper name o Consignee name o Notif# part# o %gents name o +xport registration number o 'a#ments terms o (iscretion of goods

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ro5"re#ent De$!rt#ent A
It is the ac4uisition of goods and services at the best possible cost of o!nership in the right 4uantit# at the right time in the right place for the direct benefits of the organi$ation. 4"n5tions of $ro5"re#ent 'e$!rt#ent2 o )eceive ''C sheet from store o Ta e ac4uisition o 'rice negotiation o Order place o 2hipment of goods o Time line

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o ;ollo! up tools o I>'H>)N o %ccessories o 'a#ments of purchased goods

Stores in Colony Textile Mills %t' .

1F Main store *F ;abric store E2toc pledgeF DF 2hipment store M!in StoreA There are t!o t#pes of things" !hich come under main 2tore. (I) General: 2tationar#" machine parts" maintenance and sentr# etc. (II) A55essoriesA 0uttons" thread" $ips" labels" and needles etc.

Industrial Engineering
Industrial engineering is that branch of engineering" !hich deals !ith the 'roductivit# increases the using all the available resources. These resources are follo!ing. I. Men II. Materials III. Mone#

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I1. Machine 1. Methods 1I. 2#stems 1II. LandRspace Industrial engineering provides us a s#stematic Estep b# stepF organi$ed !a# of increasing productivit# using simple techni4ues. ro'"5ti8ityA It is defined as the ratio of output and input i.e. 'roductivit# U Output R Input Scope of I.E. Industrial engineering techni4ues are applicable ever#!here" starting from a small Office" home" training places" small industr# to a large industr#. It helps inG 1. 0etter la#out planning. *. (esigning !or aids. D. )e structuring an organi$ationR )e engineering 7. Methods improvement. -. Training in better methods A. 2etting 2%Ms for the better methods 8. 'roblem solving using studies b# scientific methods

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A'8!nt!1esA 1. Managing extra !or in the same available space. *. 1acating extra premises got on rent. D. Increased output !ith the same manpo!er and machines. 7. Increased 4ualit# due to better managingRmethods -. )educed throughput Rc#cle time" using refined la#outs.

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G TH WEE3 4INANCIA% STATEMENTS

;inancial statements are summaries of monetar# data about an enterprise. The most common financial statements include the &!l!n5e s,eet " provides the user !ith data about available resources as !ell as the claims to those resources. The In5o#e St!te#ent provides the user !ith data about the profitabilit# of the enterprise detailing sources of revenue and the expenses !hich reduce profit. The St!te#ent of C!s, 4lo7 sho!s the inflo! and outflo! of cash. The statement of Ret!ine' E!rnin1s " reconciles the o!nersM e4uit# section of successive balance sheets" sho!ing !hat has happened to generated revenue. These statements are used b# management" labor" investors" creditors and government regulator# agencies" primaril#. ;inancial statements ma# be dra!n up for private individuals" non/ profit organi$ations" retailers" !holesalers" manufacturers and service industries. The nature of the enterprise involved dramaticall# affects the ind of data available in the financial statements. The purpose of the user dramaticall# affects the data he or she !ill see .

USERS O4 4INANCIA% STATEMENTS

The main user groups of financial statements includeG

In8estors : s,!re,ol'ers E#$loyees %en'ers

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S"$$liers C"sto#ers 0o8ern#ent "-li5

4INANCIA% ANA%YSIS TOO%S:TECHNI<UES

The most common toolsRtechni4ues of financial anal#sis are" R!tio An!lysis Co##onCSi=e An!lysis Differen5es of 5o#$onents of fin!n5i!l st!te#ents !#on1 in'"stries Re8ie7 of 'es5ri$ti8e #!teri!l Co#$!rison of res"lts 7it, ot,er ty$e of '!t!

R!tio An!lysis
The financial ratios are calculated using standardi$ed financial methods to determine compan# and industr# performance. The main

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purpose of financial anal#sis is to provide reasonable dues and ans!er to specific 4uestion posted b# problem of interest to the anal#st. It is flexible approach tailored to the needs of specific situations. The !or of financial anal#sis !ill become much more meaningful

and efficient if the anal#st acts its art of focus. &is investigation desired refinement of the tools chosen ma# substantiall# add to the insight gained into the financial picture of the compan#. ;inancial anal#sis in this context eeps the anal#st to appraise management performance corporate efficienc# financial strength and !ea ness credit !orthiness and other aspects of the compan# based upon its performance. 9hen the compan# financial position and process of the business is being considered three factors are of vital importance of significance. Its sol8en5y Its st!-ility Its $rofit!-ility To be solvent a business must be able to meet its liabilities as the# fall due. 2tabilit# is ,udged b# the compan#5s abilit# to meet interest on its debts and ultimatel# to repa# the principal amount o!ed. Compan#5s abilit# to pa# divided regularl# to its shareholders profitabilit# is measured b# the compan# succession maintaining and increasing its o!n 4ualit# as indicated b# the income statements.

%i>"i'ity R!tios
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The li4uidit# of firm is measured b# its abilit# to satisf# its short/term obligation as the# come due. Li4uidit# refers to the solvenc# of the firm5s overall financial position/the ease !ith !hich it can pa# its bills. 0ecause a compan# precursor to financial distress and ban ruptc# is lo! or declining li4uidit#" these ration vie!ed as good leading indicators of cash flo! problems.

C"rrent R!tio
C"rrent R!tio H C"rrent !ssets : C"rrent li!-ilities Ye!rs CR .++G 0.96 .++I 0.9 .++/ 0.99 .+1+ 0.!9 .+11 ".00

%lso called the Working Capital Ratio, it measures the extent to !hich current assets are available to meet current liabilities Edue !ithin the next 1* monthsF. Your current ratio !ill be particularl# important to #ou if #ouMre thin ing of borro!ing mone# or getting credit from one of #our suppliers. 'otential creditors use this ratio to measure a compan#Ms li4uidit# or abilit# to pa# off short/term debts. The overall current ratio of the compan# !as satisfactor# but the compan# has to improve it because technicall# it is not good and it sho!s that the compan# is not in a position to satisf# its short/term obligations.

<"i5k R!tio
<"i5k r!tio H C"rrent Assets C (In8entory J C"rrent %i!-ilities re$!i' ex$2) :

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Ye!rs <R

.++G 0.#$

.++I 0."!

.++/ 0.#%

.+1+ 0.#0

.+11 0."9

The 4uic ratio" sometimes called the acid test ratio " is similar to the current ratio" but is considered a more reliable indicator of a compan#Ms abilit# to meet its short/term financial obligations. 0ecause inventor# can sometimes be difficult to li4uidate" this ratio deducts inventor# from #our assets before computing the ratio. >enerall#" a Ouic )atio of 12+ or greater is considered ade4uate to ensure a compan#Ms abilit# to pa# its current obligations. The 4uic ratio of the compan# is not satisfactor# and belo! the average of 12+ and sho!ing an irregular trend.

Net Workin1 C!$it!l

NWC H C"rrent Assets C C"rrent %i!-ilities
R"$ees i n t,o"s!n'

Ye!rs NWC

.++G
&$"' 9 !

.++I
&66'!( (

.++/
&"0'06 #

.+1+
&" %'6!(

.+11
&#'#"6

Net !or ing capital sho!s that ho! man# assets remain after deduction of current liabilities. The negative net !or ing capital sho!s that in short/term the compan# is not good and the compan# !as not in a position to get short/term borro!ing because it cannot repa# them. The overall position of net !or ing capital is not satisfactor#. In all #ears the net !or ing capital is negative that sho!s that Compan# is not able to meet its short/term obligations.

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A5ti8ity r!tios
%ctivit# ratio measure the speed !ith !hich various accounts are converted in to sales or cash. 9ith regard to current accounts" measures of li4uidit# are generall# inade4uate because differences in the composition of a firm5s current assets and current liabilities can significantl# affect its PtrueQ li4uidit#. It is therefore important to loo be#ond measures of overall li4uidit# and to asses the activit# Eli4uidit#F of specific current account. % numbers of ratio are available to measuring the activit# of the most important current accounts" !hich include inventor#" accounts receivable" and accounts pa#able.

A8er!1e Colle5tion

erio'

DSO H A55o"nts Re5ei8!-le : (S!les : *B+ '!ys)

Ye!rs AC (D!ys )

.++G " .(%

.++I "9.$0

.++/ "9.!(

.+1+ " ."#

.+11 "6.((

Measures the average number of da#s customers ta e to pa# their bills" indicating the effectiveness of credit and collection policies of the business. The overall position in collection period of the compan# is good it is due to good management of collections but it could also be the signal of an overl# tight credit polic# limiting sales and profits.

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A8er!1e
A H A55o"nts Ye!rs A (D!ys ) .++G # .0"

!y#ent

erio'

!y!-le : ( "r5,!ses : *B+) .++I #(. ! .++/ $.#0 .+1+ $6.9 .+11 "#.6!

Measures the average number of da#s it ta es to pa# suppliers. The average pa#ment period of the compan# is greater than the average collection period this is due to ineffective pa#ment procedures or a poor cash position since last four #ears it is decreased to 1Dda#s. &igh average pa#ment period as compared to collection period creates problem to the compan# for bu#ing on credit.

4ixe' Assets T"rno8er

4AT H (S!les : Net 4ixe' Assets) )ears *A+(+i,es) .++G (.9( .++I (.$$ .++/ .6$ .+1+ .66 .+11 (.%(

%lso called the Sales to Fixed Assets Ratio, it measures the number of sales dollars earned for each dollar of investment in fixed assets. This ratio is normall# used !ith the %sset =tili$ation )atio. The fixed assets turnover of the compan# meets the standard of the industr#" it indicates the follo!ingG %n efficient use of resources" favorable to ma ing profitsK an over/ use of production capacit#K or the reliance on older fixed assets

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those need to be replaced.

Tot!l Asset T"rno8er

Tot!l Asset T"rno8er H S!les : Tot!l Assets )ears +A+(+i,es) .++G #.#0 .++I ".6" .++/ #.#$ .+1+ ".9! .+11 ".!%

Measures the number of sales dollars earned for each dollar invested in assets. % lo! ratio compared to other businesses in the same industr# can indicate an over/investment. % higher ratio value than the industr# standard can indicate an efficient use of resources favorable to ma ing profits.

In8entory T"rno8er
In8entory T"rno8er H Cost of 0oo's : Tot!l In8entory )ears Inv. +(+i,es) .++G .9" .++I $.6" .++/ 6.($ .+1+ 6.6" .+11 .6

Measures the number of times inventor# has been turned over Esold and replacedF during the #ear. It is a good indicator of inventor#

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4ualit# and inventor# management. % high turnover rate is an indication of good inventor# management. % ma,or variance from industr# standards ma# indicate an inventor# surplus resulting from a poor purchasing or mar eting polic#.

De-t R!tios
The debt position of a firm indicates the amount of other people5s mone# being used to generate profits. In general" the financial anal#st is most concern !ith long/term debt" because these commit the firm to a stream of pa#ments over the long run. 0ecause the creditors5 claims must be satisfied before the earning can be distributed to shareholder" present and prospective shareholders pa# close attention to the firm5s abilit# to pa# debts. Lenders are also concerned !ith about the firm5s indebtedness.

De-t R!tio
De-t R!tio H Tot!l %i!-ilities : Tot!l Assets@1++

)ears -.(/)

.++G !(.9

.++I !!.6

.++/ !$.

.+1+ !6.6

.+11 ! ."

The debt ratio measures the proportion of total assets financed b# the creditors. The debt ratio of the compan# is greater of the average i.e. A.C. 0ut compan# ratio is almost *.C plus that is higher than the

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Colony Textile Mills Ltd

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average !hich sho!s high leverage as a result compan# sho!s high variation in the profits. It is not good sign for compan#.

De-t to E>"ity
De-t to E>"ity H %on1 Ter# De-t : Tot!l E>"ity )ears -e0t to E1uit2 .++G ".!!:" .++I #.# :" .++/ ". %:" .+1+ ".9%:" .+11 ".%9:"

This ratio indicates the amount of liabilities the business has for ever# dollar of shareholdersM e4uit#. 0ecause this ratio is a good indicator of a businessMs capacit# to repa# its creditors" it is considered ver# important b# most term lenders. Compan# debt to e4uit# ratio is ver# high and compan# arranges more and more funds due to its ne!l# !eaving unit !hich is almost complete.

Co8er!1e r!tio
Ti#es Interest E!rne' H E&IT : Interest )ears C. .++G ".9% .++I "."9 .++/ ".!! .+1+ #.0" .+11 #.!$

%lso

no!n as the Times Interest Earned Ratio " it measures the

businessM capacit# to generate enough income to pa# the interest on

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Colony Textile Mills Ltd

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its loans. % lo!er value ma# indicate that the debt load is too high for profitabilit# and that the business ma# not be able to meet all of its obligations. The coverage ratio of the compan# is not belo! the standard but compan# too steps to improve it.

rofit!-ility R!tios
The profitabilit# figures measure the abilit# of the business firm to earn a profit from its operations through assets" sales" and e4uit#. These ratios enable the anal#st to evaluate the firm5s profits !ith respect to a given level of sales" a certain level of assets" or the o!ner5s investment. 9ithout profits" a firm could not attract outside capital. O!ners" creditors" and management pa# close attention to boosting profits because of the great importance placed on earning in the mar etplace.

0ross

rofit M!r1in

0 M H (S!les C Cost of 0oo's Sol'): S!les )ears GP3 (/) .++G 9.6! .++I !."( .++/ %.99 .+1+ .6 .+11 6.0

Your gross profit ratio tells #ou ho! much of each sales dollar #ou can expect to use to cover #our operating expenses and profit. >ross

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profit margin ratio is graduall# decreased due to increase of cost of goods sold. In cost of goods sold" the prices of ra! material are increased and !ages of direct labor is graduall# increased.

O$er!tin1
O$er!tin1

rofit M!r1in
rofits : S!les

rofits H O$er!tin1

)ears 4P (/)

.++G !.0

.++I 6. #

.++/ 6.%6

.+1+ (.$6

.+11 (.%#

Operating profit sho!s that !hatMs left from #our sales dollar after #ouMve deducted #our cost of goods sold and #our ordinar# operating costs.

Net
N M H Net )ears 5P3 (/)

rofit M!r1in

rofits :S!les .++G #.9( .++I (0.09) .++/ #.0! .+1+ 0."" .+11 ".!!

%lso called the Return on Sales Ratio, it sho!s the after/tax profit Enet incomeF generated b# each sales dollar b# measuring the percentage of sales revenue retained b# the compan# after operating expenses" creditor interest expenses" and income taxes have been paid. It also sho!s decreasing trend due to high pa#ment of interest

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expense because compan# approximatel# operates on I+K debt.

Ret"rn on E>"ity
ROE H Net )ears .4E (/) rofits : Sto5k,ol'ers E>"ity .++G (#.!9 .++I (".$") .++/ #%.9 .+1+ ".6# .+11 #$.

Measures the rate of return the shareholders receive on their investment in #our business or Indicates the dollar amount of after/ tax and after/interest profit generated for each B1 of e4uit#.

E!rnin1s $er S,!re

E S H Tot!l E!rnin1s : No2 of s,!res o"tst!n'in1 )ears EPS (.s.) .++G 6.%( .++I (0.#0) .++/ 6.0# .+1+ 0.$ .+11 6.6!

Measures the after/tax earnings generated for each share of common stoc . +arnings per 2hare do not appl# to prefer shareholders as the# receive dividends before shareholders. an# dividends are made to common

Di8i'en'
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D: 1++

H Di8i'en' $er or'in!ry s,!re (D S): E!rnin1 $er s,!re @

)ears -6P

.++G (. !

.++I 0.00

.++/ 0.00

.+1+ 0.00

.+11 0.00

Measure the percentage of +'2 that is given to the shareholder5s as a dividend.

I TH WEE3 ANA%YSIS AND INTER RETATION SWOT ANA%YSI STREN0THS

ISO /++1C.+++A CTML is certified under I2O 6..1/*... and so it meets the re4uirement of international standard and has a value in the mind of concern people. Stron1 Se5"rity Syste# CTML has a greater securit# s#stem. There are different hidden securit# cameras !hich capture all the moments. Hi1, >"!lity $ro'"5t CTML is using advance technolog# li e the# have modern machiner# b# !hich the 4ualit# of product produced is ver# high. %!test #e5,!ni=e' #!5,inery2 The# are using modern looms !hich the# have purchased from 3apan" >erman# and ;rance. %nd b# using that latest machiner# the productivit# of the emplo#ees are ver# high. Tre#en'o"s #!rket $ositionin1

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CTML is one of the 'ioneer Textile >roup in the 'a istan so it has got the position in the mind of its customer. %nd being an old textile compan# people are lo#al !ith it. CTML has a better position in the mind of its customers. Hi1,ly >"!lifie' !n' skille' #!n!1e#ent The management of CTML is s illed the# have hired the foreign graduate people in their management and also experienced people from all over the countr#. Hi1,ly Moti8!te' Workfor5e The# are providing better pa# to their emplo#ees and also bonus to them !hich motivate the !or force and the# are doing !ell at !or setting. %part from that the# are giving their emplo#ees facilities of Convenience li e personal car along !ith fuel provided b# the compan# too" !hich is a big deal for motivating the emplo#ees. A'e>"!te fin!n5i!l reso"r5es The o!ners of CTML are one of the richest persons of the 'a istan and the# have more plant and investment in other industries li e 2ugar Mills" and 2hare Mar et. The# have ade4uate financial resources to meet their re4uirements. Co#$etiti8e !'8!nt!1e 0ecause it is an old textile originating from 16-.5s and it has still ept its position in the textile mar et on all competitors nation!ide" !hich is its competitive advantage. O7n o7er 0ener!tion l!nt The# have o!n po!er generation plant and CTML is the pioneer in the private organi$ation !ho start the po!er generation.

We!knessesA
Hi1, 5ost of $ro'"5tion The production cost is high because of un/proper utili$ation of resources. Centr!li=e' 'e5ision #!kin1

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The decisions are made b# the upper management !hich is !ea ness of the CTML because the# have not an# proper idea about the prevailing situation and their decision can be un/fruitful for the compan#. %ess $ro#otion!l !5ti8ities The advertising and promotional cost of the CTML is ver# lo! it can ta e advantage for more turn outs.

O$$ort"nityA
Or1!ni=!tion 5!n ex$!n' ro'"5t %ines Currentl# the CTML is not dealing in nit!ear the# can expand their product line b# producing nit!ear. The# have plants and the extra cost for the production !ill be lo! for CTML. The# also have better mar et repute. Or1!ni=!tion 5!n re'"5e t,e 5ost -y $ro$er "tili=!tion of reso"r5es If the cost of different matters !hich are not been utili$ed properl#" is controlled b# the CTML management the# can produce more at less costs. It has to develop a further s#stematic process for controlling and managing resources. Or1!ni=!tion 5!n ,ire #ore 7ellCe'"5!te' !n' ex$erien5e' $erson The# can ta e advantages b# hiring more s illed people and the# should hire #oung" fresh and energetic staff for their betterment. 0ecause being human" #ou al!a#s have the room for betterment in an# aspect.

T,re!tsA
&"yer nee's 'e#!n's 5,!n1es 0ecause of the research H development the design and the product of CTML is ,ust satisfactor# as compared to competitors in the global environment and the# are not

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fulfilling the demand of customers. oliti5!l inst!-ility 'olitical instabilit# effects the CTML because of the 4uota s#stem" >overnment can restrict the Compan# to export. C,!n1e' of 1o8ern#ent $oli5ies >overnment policies are changing da# b# da# so it is al!a#s a threat for not onl# CTML but for an# compan# to survive in such a environment. 0lo-!lly E5ono#i5 inst!-ility 0ecause of the economic instabilit# the CTML and the P(umping s#stemQ !hich is rising on dail# basis in the !orld can create man# problems for the compan# and an# uncertaint# in the !orld li e 6R11 ma# also affect its overall exports.

EST An!lysis
oliti5!l Inst!-ility
The political situation of 'a istan is not satisfactor#. (ue to the rapid change in the >overnment ever# government sets its o!n ne! trade policies. >ovt. should appl# sustainable policies for the beneficial of the exporters as !ell as the investors. E5ono#i5 sit"!tionA The economic condition of 'a istan can also affect the foreign investors increasing inflation rate ma e the cost of production high and thus reduce the profit margin of the investor.

So5i!l sit"!tionA
The change in the lifest#le of the people affects the

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gro!ing demand of the CTML products. The change in the lifest#le and needs in different demographics also affect the demand of the customers.

Te5,nolo1i5!l f!5torA
Technological advancement in all the sectors of the countr# has changed the entire socio/economic environment. +speciall# in the textile sector there is a lot of technological development. CTML5s excellent computeri$ed machines and devices have made extension in its present setup of !ell advanced technolog# imported from 3apan" >erman# and ;rance.

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4in'in1s
%fter the completion of m# internship and anal#ses Eenvironmentall# and financiall#F of Colon# Textile limited" I am able to give the suggestions" these are not onl# benefited for management" the emplo#ees can also improve their efficienc# and get incentives b# performing their duties in good manners. These suggestions are as follo!sG There is centrali$ation of authorit#. %ll the decisions are made b# the Chief +xecutive and other (irectors. +ven the chief accountant of an# unit can not ta e an# decision on his behalf. The authorit# should be decentrali$edK the division of authorit# creates the responsibilit# and satisfaction. 0# the decentrali$ation of authorit#" top management can save its important time. 0ecause the delegation of authorit# creates the confidence among the emplo#ees" so the# !ill perform their !or efficientl#. I !ould li e to recommend that the management should develop some policies for the promotion of !or ers. %s there is no polic# for the promotion of !or ers so it is creating unrest among !or ers. The rate of turnover is ver# high due to lo! pa# and no promotion polic#. The management should ma e sound policies for the promotion of efficient !or er. This !ill increase in productivit# of !or ers and also the management can reduce the turnover among the experienced emplo#ees.

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The compan# should start training programs especiall# among the top management level as !ell as middle level managers. 0# this action the productivit# as !ell as efficienc# of emplo#ees !ill increase. The culture of the organi$ation should be according to the !ell established organi$ations.

The %dministration cost of Colon# Textile is ver# high" management emphasis on the high administrated cost. 'roper training and cooperation should be given to the ne! recruited emplo#ees. (ue to this the# can easil# established in the organi$ation according to the organi$ational culture.

There is no an# procedure for evaluating the !or

and

efficienc# of the emplo#ees and there are no extra benefits for the efficient !or ers. The top management should introduce the procedure for evaluating the performance of !or ers and should be given the re!ard to efficient !or ers. This action !ill increase the efficienc# and productivit# and not !ill increase the burden on the organi$ation. There is lac of staff in the offices" so ne! emplo#ees should be recruited for the proper !or ing and removing burden on other emplo#ees to achieve efficienc# and better results. The# do not export the product of ghee. The compan# should

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thin

about the export of ghee. (ue to this reason or action

the# can improve the 4ualit# and can earn more profit b# exporting.

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CONC%USTION
I got a lot of experience in Colon# Textile Ltd. (uring m# internship I came to no! that ho! the different activities ta e place" !hat are the proceduresV The Colon# Textile Ltd. is on the !a# of progress. It has been earning profit for the last five #ears. The management is professionall# 4ualified and experienced. The Colon# Textile Ltd. 2hould motivates their emplo#ees b# providing different incentives. Their salar# pac age at sight is also not attractive for lo!er operatives. There is no proper human resource department. Colon# Textile Ltd. 'roduce high 4ualit# #arn. The demand of its products is increasing !ith the passage of time. The compan# should expand its capacit# as soon as possible to satisf# the demands of its customers. ;or this Colon# Textile Ltd. established a !eaving unit that is starting its production b# the end of %ugust.

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