Chapter 01

INTRODUCTION

1.1 COMPANY PROFILE

“The Kohinoor Maple Leaf Group was born from the trifurcation of the Saigol group of
companies and is a reputable and leading manufacturer of textiles and cement. KOHINOOR
TEXTILE MILL comprises of Kohinoor Textile Mills limited (KOHINOOR TEXTILE
MILL) and Maple Leaf Cement factory limited (MLCF). Both companies are incorporated in
Pakistan and are listed on three stock exchanges of the country.”1

The Company started its operations in 1953 as a private limited company and was later
incorporated in 1968. Initially, Rawalpindi unit comprised of twenty five thousand spindles
and six hundred looms. Later, fabric processing facilities were added and spinning capacity
was increased. Production capacity was increased by acquisition of a facility at Raiwind-
Manga Road near Lahore in District Kasur and by way of merger on the Gulyana Road near
Gujjar Khan. The Company’s production facilities now comprise 151,902 ring spindles
enabling it to use a wide range of counts using cotton and man-made fibers. The processing
facilities at the Rawalpindi unit are of great interest as far as the home textile’s local market
is concerned. The stitching facility is catering to the needs of home textile for the export
market.

IT achieves the optimization level at all three sites by having a fully equipped laboratory
which helps the company to have a complete check on processing and quality control. The
corporation is fully aware of its future prospects for which it’s investing in information
technology, advancing its human resources and by improving its management sector.
Kohinoor Textile Mills Limited aimed to remain at the existing position as well as ongoing
improvement process in order to achieve the fame as the world best practice manufacturing
organization.2
1.2 COMPANY INFORMATION

Kohinoor Textile Mills information is available in Annexure-I.

1.3 COMPANY STATEMENTS

1.3.1 Vision Statement

“The Kohinoor Textile Mills Limited stated vision is to achieve and then remain as the most
progressive and profitable Company in Pakistan in terms of industry standards and
stakeholders interest.”3

1.3.2 Mission Statement

The Company shall achieve its mission through a continuous process of having sourced,
developed, implemented and managed the best leading edge technology, industry best
practice, human resource and innovative products and services and sold these to its
customers, suppliers and stakeholders.3

1.3.3 Statement of Ethics and Business Practices 2009 - 2010

The following principles constitute the code of conduct which all Directors and employees of
Kohinoor Textile Mills Limited are required to apply in their daily work and observe in the
conduct of Company’s business. While the Company will ensure that all employees are fully
aware of these principles, it is the responsibility of each employee to implement the
Company’s policies. Contravention is viewed as misconduct.

The code emphasizes the need for a high standard of honesty and integrity which are vital for
the success of any business.

1.3.5 Company Certifications

Some of the company’s prominent certifications are SA 8000:2001, Oeko-Tex Standard 100,
ISO 9001-2000, HEMA accepted laboratory, Supima, SA 8000-2001 (Weaving Division),
ISO 9001:2000 (Weaving Division).4

3
1.4 THE TEXTILE SECTOR

1.4.1 Introduction

“The Pakistan textile industry total export is around 9.6 billion US dollars. The textile
industry contributes approximately 46 percent to the total output or 8.5 percent of the country
GDP. In Asia, Pakistan is the 8th largest exporter of textile products providing employment
to 38 percent of the work force in the country. However, the textile industry currently faces
massive challenges. The All Pakistan Textile Mills Association (APTMA) needs to enhance
the quality of its products. However, APTMA argues other factors such as high interest rates
and cost of inputs, non conducive government policies, and non-guaranteed energy supplies
hinder their competitiveness.”5

1.4.2 History and Introduction of Textile Industry

Since 1947 Pakistan has shown an impressive increase in cotton production and expansion of
textile industry. Cotton in 1947, there was 1.1 million bales and in 2000 it reaches to
10million. Mills in 1947 there were three mills and in 2000 it reaches to 600 mills. Spindles
were 177,000 in 1947 reached to 805 millions in 2000.

Pakistan’s textile industry fairly large size textile industry and 60-70% of machines need
replacement for the economic and quality production of products for a highly competitive
market. But unfortunately it does not have any facility for manufacturing of textile machinery
of balancing modernization and replacement in the textile mills. We need to think about joint
ventures for the production of complete spinning units with china, Italy and production of
shuttle less looms with Korea, Taiwan and Italy.

“The textile industry of Pakistan has a total established spinning capacity of 1550 million
kg’s of yarn, weaving capacity of 4368 million square meters of fabric and finishing capacity
of 4000 million square meters. The industry has a production capacity of 670 million units of
garments, 400 million units of knitwear and 53 million kg’s of towels. The industry has a
total of 1221 units engaged in ginning and 442 units engaged in spinning. There are around 124
large units that undertake weaving and 425 small units. There are around 20600 power looms in
operation in the industry. The industry also houses around 10 large finishing units and 625 small
units.”

3
According to the recent figures, Pakistan’s textile industry is contributing more than 60% to
the country’s total exports, which amounts to around $5.2 billion. Pakistan is the 8th largest
exporter of textile products in Asia. Textile industry’s total contribution to the GDP is 8.5%
and is employing 38% percent workforce of the country. Though there is a dire need to open
either the training centers to help the industrialists employ the best workforce or either the
industrialists train the hired workforce in their own learning centers so that the maximum can
be achieved.

1.5 The Textile Process

The mentioned process in Annexure-II is an overview of how things go in textile industry.

The weaving unit mentioned above is not part of KOHINOOR TEXTILE MILL RWP but is
in Raiwind facility. Also the process mentioned above is a bird’s eye view, there are
subdivisions of each division e.g. if we talk about processing there is dyeing unit, bleaching
unit etc.6

1.6 Different Departments

There are different departments of the company and are so integrated that one has to learn the
trick of the trade. My internship was carried out in marketing and HR departments. Besides I
also visited and learned about the working of different departments. The other departments
are namely:

Finance, Marketing, HR/admin, Procurement, Export, Logistics, Shipping, Planning and

Control, Spinning, Processing, Stitching

1.6.1 The HR Department

Kohinoor’s Management believes that their people are their most valuable asset. They view
human resources as a competitive advantage and therefore ensure that only motivated and
professionally qualified people are employed here. They also ensure that business goals are
realized through people whilst meeting their own personal aspirations. KMLG is an equal
opportunity employer with policies to ensure there is no discrimination on the basis of cast,
creed, sex and religion.7

3
The H.R Department is the key strength of any organization in motivating employees,
managing HRMIS system, dealing external affairs, handling with each department’s
performance, making promotions etc. My major area where the internship was done was
Human Resource Department.

3
Chapter 02

Learning and Personal Experience

My personal experience at KOHINOOR TEXTILE MILL as far as learning is concerned was

great. There was a lot to learn. At first I thought I have entered into a whole new world as one
of my boss mentioned

”textile is a sea, learn to swim and explore the depth……….”

Once I listened to those words I was wondering if they are true, but yes by the time I ended
my internship I found them true.

Now from here I’m going to discuss HR and Marketing (yarn & export) departments, since
my entire internship was carried out in these departments.

2.1 The working of HR

Hierarchy of the department is given in Annexure-III HRMIS is oracle based program in

which the software was already installed of H.R related activities. H.R.M.I.S included
Appraisals, Transportation, Wages, and Bonuses.

2.1.1 Employee’s Detail

The employee’s details were based on Employee I.D, Employee Name, Father Name, Date of
Joining, and Date of Leaving.

2.1.2 Break up of Salaries

The break up of salaries was based on the basic and the allowances, there were categories of
6,000, 8000, 8100, 21000, 28000 and the basic was 55% of the gross pay.

2.1.3 G.P.Fund

The G.P.Fund also had to pay back to the resigned employees and that’s been added by 10%
of the basic in the sum of G.P.Fund and it added doubled each month. For example if the
amount of G.P.Fund is 500 for the month, then it will be added 500+500. And 500 once
deducted from the basic salary.

3
2.1.4 Deductions

The deductions included Advance salary, Zakat (applied on 16,228 or above of G.P.Fund),
Advance G.P.Fund, Interest on G.P.Fund, Canteen Expense.

2.1.5 Accommodation Facility for Employees

Employees are also facilitated with accommodation facility. Executives are been given hostel
facility with respect to the flats which included Luxurious Bed Rooms, Attached Bath, T.V,
A.C, Canteen, Mosque, Guest Room. Families of employees are also been facilitated in
hostel. Workers in the mill are also facilitated with residence facility with some necessary
needs of lower level employees.

2.1.6 Health & Safety Measures

Each company has its own health and safety measures according to the compliances regulated
by the regulatory bodies. So, KOHINOOR TEXTILE MILL also has the safety measures so
they have to inspect their safety measures morning and evening and it inspects in different
areas like Spinning, Processing, Stitching, Made-up, Canteen. And the things to be inspected
are Passage, Fire Exits, House Keeping, Smoke Detectors, First Aid Box, Fire Hydrants,
Control Panel, and Fire Extinguisher.

2.2 HR Policies

2.2.1 Leave Policy

There is a standard procedure to grant different kinds of leave to its employees in order to
facilitate them to attend to their domestic and social responsibilities.8

2.2.1.1 Types of Leave

The types of leave available to employees are Causal leave, Sick leave, Earned leave, Leave
without pay, Maternity leave

1. Casual Leave

Every employee will be eligible for ten days casual leave in each calendar year. Casual leave
can be granted on proportionate basis depending on the length of service. Un-availed casual
leaves shall lapse automatically at the end of every calendar year. Casual leaves cannot be

3
combined with any other type of leave except sick leave. Casual leave can be availed for a
maximum period of 3 days at one time.

2. Sick Leave

Every employee will be eligible for eight days sick leave in each calendar year. Sick leave
will be granted on proportionate basis depending on the length of service. Sick leave
exceeding 2 days must be supported by a medical certificate from a registered doctor or
hospital.

3. Earned Leaves

Every employee will be eligible for earned leave as Workers-14 days, Staff-15 days. Earned
leave will be due only after completion of one year’s continuous service with the company
from the date of joining. Earned leave shall be credited to the employee account at the end of
each year of service. It is incumbent for management staff in grade M-12 and above to avail a
minimum of 15 days earned leave in a calendar year. Earned leave lying to the credit of an
employee will be cashed at the time of separation for the company for employee up to Grade-
12.

4. Leave without pay

There is no provision of leave without pay in Law. How ever extra-ordinary leave without
pay may be granted at the discretion of the competent authority in special circumstances
involving absence from duty.

5. Maternity leave

Female married employees who have been employed for more than one year will be granted
maternity leave. Maternity leave of 12 weeks, 6 weeks each before and after the delivery will
be granted on production of medical certificate from a registered medical practitioner.

2.2.2 Transport Policy

Company Maintained Car will be provided to the following categories of employees, as

indicated against each in Annexure-IV.

The Human Resource Department will issue allotment letter to the eligible official at the time
of handing over the car.

3
2.2.3 PETROL/DIESEL

The limit of petrol/Diesel is given in Annexure-IV

The bills with detail of the expenditure incurred on the repairs of the car will be submitted to
HR department. Vehicle maintenance card shall be maintained for each vehicle by H.R
department. The bill will be forward to finance department for re-reimbursement after
making necessary entry in the maintenance card. In case of any damage/accident the allottee
will forward “Vehicle Accident Report” to finance department who will arrange
repairs/maintenance through comprehensive insurance policy. For other employees company
provide the facility of air conditioner buses and vans. The vehicle may be sold to the allottee,
after the expiry of the stipulated replacement period on market rates.

2.2.4 Time Office

Time office does the activities like keep the daily attendance of employees. Make the
settlement of the resigned employees to be further proceeded to the H.R Department. Gives
the half leaves or temporary leave for about 1 to 2 hours.

2.2.5 Attendance Allowance

Completion of monthly standard working hours is a must to become eligible for full monthly
salary, and attendance allowance. Only piece rate employees get attendance allowance.

Kohinoor textile mills limited set criteria for attendance allowance 3000 rupees company pay
as attendance allowance. One absence =3000-500=2500, Two absence=3000-1000=2000,
Three absence=3000-2000=1000, Four absence=3000-3000=0.

2.2.6 EO.B.I contribution

Employee old age benefit institution is as follows for employees who will be given this
amount when they will reach to age of 60 for male and 55 for females. Paid by company =
5% of minimum Wage i.e. Rs. 300, Paid by Employee = 1% of minimum wage i.e. Rs. 60,
Total Contribution = 6% of minimum wage i.e. Rs. 360

2.2.7 Social Security

Employees who have salary limit up to Rs. 10,000 are covered under Punjab Employees
Social Security Institution. Rs 360 i.e. 6% of minimum wage paid by company every month.
Employees and their dependants are covered under this institution. Employees are eligible for

3
benefits (medical facility) under this fund. HR department generate reports every month and
after verification send to finance department. Finance department prepare Cheques for social
security. Prepare this report under the HR Officer.

2.3 HEALTH INSURANCE

Employees having salary more than Rs: 10000 are covered under Adam Jee Health Insurance.
Same as social security employees who have salary limit up to Rs. 10,000 are covered under
Punjab Employees Social Security Institution.

2.4 Resignations

The resignation is the major problem of most of the organizations, this turnover increases day
by day as the policies and conditions been changed with time. So, the employees who have
left the organization due to their own problems, terminations, S.O.S need to settle their final
dues that company has to pay. There are following rules that need to be followed by the
company in order to settle the accounts of resigned employees.

2.4.1 Notice Period

It is the period to which the employees have to inform the organization about his resignation.
There are two ways to intimate the organization. One Month Notice Period, 24-Hour Notice
Period, Termination, P-Fund,

2.4.1.1 One Month Notice Period

In one month notice period the employee must inform the company one month before his
resignation, for this he has to give the notice to the company that he will leave the
organization one month after the intimation is given. The basic pay which is almost 56% of
the net pay will not be deducted from employee’s account.

2.4.1.2 24-Hour Notice Period

In 24-hour intimation from employee will loose the basic pay of 56% of the net pay. And this
could happen in an emergency decision from employee, when he has an emergency or he has
settled the things with another organization.

3
2.4.1.3 Termination

In the termination process the employee has been terminated due to his unhealthy activities in
the organization or lack of interest in working. In termination the employee has been given
the basic pay and it’s not been deducted in notice period deduction.

2.5 Provident Fund

Provident fund also been given in the final settlement of employee and it was been deducted
each month by 10% of the basic pay. Zakat is been deducted 2.5% of the net P-fund and its
being applied on Rs: 16,228.

2.6 Allowances

The allowances that are being added in the basic are Utility, House Rent, Medical, Other
Benefits, and COLAS

Deductions being made are Income Tax (Not Refundable), E.O.B.I-% of Gross (Employee
Old Age Benefit Institution). It’s been given at the age of 60. Its % depends upon the gross
variation.

2.6.3 P-Fund-(Provident Fund)

P-Fund is deducted each month by 10% of the basic pay and refundable. Advance Salary,
Interest on Advance Salary- 60%, Advance P-Fund, Interest on Advance P-Fund- 5%.

2.7 Transfer of Employees

As K.T.M has five Divisions, so in accordance to the employees is concerned, transfers been
done if require between these divisions, so it is also the responsibility of H.R to update the
transfer record in the oracle system. They also got to change their employee I.D’s, because
the I.D in which they were working will be changed in accordance to the other division’s
requirement.

For example, an employee who had employee I.D in weaving was 149 and he is been
transferred in hosiery division in the same designation but with different I.D like 9464.

3
2.8 Piece Rate System

As we know very well that the organizations uses different modes of employment, one of
them is the piece rate system, so K.M.L has changed its two of the department’s mode of
employment to the piece rate. The departments are linking and Boarding

2.8.1 Linking

Linking is the department in which the socks need to be linked from the palms. Total 50
employees have been converted to piece rate. So, they got to give the resignation to start their
piece rate job for this they got to give their final settlements and make their new files,
because the piece rate registration form is different from their permanent employment. The
rate for per day is Rs: 175/- for linking employees.

2.8.2 Boarding

In the boarding the socks need to be flexible with the help of the sizes been attached on
machines. And 128 employees have been converted to the piece rate system. So their process
of mode is same as linking. The rate for per day is Rs: 250/- for boarding employees. Their
pay will not be as fixed as of the permanent employees and the new employees don’t have the
facility of social security for the 1st 3 months but the employees who have been transferred
from permanent to piece rate has the facility of social security. There is no system of
provident fund in piece rate.

Now I’m going to mention the major on the job assignment that took me almost two weeks to
complete.

2.9 ON JOB ASSIGNMENT

While working in the HR/Admin department of KOHINOOR TEXTILE MILL Sir Aziz-ul-
Hassan gave a major task i.e. to redesign the performance appraisal form of KOHINOOR
TEXTILE MILL. It was a challenge for me because I haven’t yet studied even HRM as a
course, so performance management is a far cry. Though I took the challenge head on, did the
literature survey and produced a report that was applauded by the guys working in the HR
department.

I was provided with a current appraisal form and then was asked to come up with a best
redesign. The points I thought were flaws are as under:

3
2.9.1 FLAWS

“The problem with this appraisal form is that most of the working class is less educated. This
form includes ISO 9000 general awareness and its implementation which is a bit vague. Also
the aforementioned groups are not explicitly rated i.e. they include main groups and in them
there are subgroups, but the points are given only against main group which is insufficient to
explain how many points are given against which subgroup.”

Then on the basis of these points I recommended few things for performance appraisal of
KOHINOOR TEXTILE MILL. The main points are as under:

2.9.2 RECOMMENDATIONS

a) “Use of MBO for employees in grade M-14 & above

b) Peer rating should be considered

c) Temporary employees should also be appraised on the basis of interim appraisal

d) Critical feedback is a must

e) Use of BARS“

The above are the highlights of the report. For complete report see annexure-V

2.10 The Marketing Department

2.10.1 The Department (yarn)

The hierarchy is given in Annexure-VI. The marketing yarn department deals with yarn
marketing and sales only. Most of their customers are locals. This department gets the output
from spinning unit and that’s exactly why they told me more about spinning working.

2.10.2 Capacity

Kohinoor Textiles comprises of two spinning divisions located at Rawalpindi (KOHINOOR

TEXTILE MILL) and Gujjar Khan (KGM). There are a total of nine units with 151,000
spindles capable of spinning a complete range of coarse and fine count yarn from natural and
man made fibers. In particular, Kohinoor specializes in fine count yarn for high thread count
home textile products. The total production of yarn is 28,800,000 Lbs per annum. Five units

3
with 85,500 spindles are at Rawalpindi and four units with 65,500 spindles are at KGM. Both
divisions are modern facilities with state of the art machinery from Europe and Japan.9

2.10.3 Product range

At Kohinoor yarn is manufactured from Pakistani, extra long staple/medium staple CIS, US
Pima and Egyptian cotton. To maintain quality and consistency in the product, sophisticated
in house labs have been set up for the testing of raw materials and stringent measures are
taken throughout the production process.9

2.10.4 Quality focused solutions

KOHINOOR TEXTILE MILL is a leading consumer of American Pima cotton and is a

member of the Supima Association of America. The advantage of this is that all products
manufactured from Kohinoor’s yarn have a Supima trademark. The spinning divisions of
Kohinoor have a diverse customer base with sales in both the local and export markets. The
main international markets include South East Asia, Hong Kong, Japan, Europe, USA and
Australia. All divisions of Kohinoor Textile Mills are ISO 9001-2000 certified by Lloyds
Register Quality Assurance UK.9

2.11 The Marketing Process

The following is an overview of the marketing process.10

2.11.1 Inquiry

In inquiry we check the order is either existing/running or odd/new.

2.11.2 Spinnability

In this step if the order is new, the spinnability and the production capacity is checked. If it’s
OK then rates are offered. This process is not done for existing orders.

2.11.3 Costing

Once the production capacity is checked, cost is estimated. The cost is estimated and the rate
is offered on the basis of Raw material costs, Yield recovery, Output, Productivity(OPS),
Packing cost, Breakeven rate, Selling rate

2.11.4 Rates

3
Once costing is done rates are offered. If the rates are accepted straightaway fair enough to
proceed, if not then he parties negotiate. If rates are decided then the terms and conditions are
decided and also confirmation is attained.

2.11.5 Agreements

Once the rates are finalized the agreements are signed. The agreement from the buyer and the
seller is signed by both the parties.

2.11.6 Payment

The mode is also decided in agreements. The preferred mode of payment is cash on delivery
in the local markets. Besides other modes are DD/ Check etc. For the sales in international
markets Letter of credit needs to be attained. The original letter of credit once received the
production is started.

2.11.7 Production

Then the production is starts. Quality is being monitored during the entire process. Once the
desired quantity is produced, dispatches are managed. This process is done mostly by sipping
department. Once the order is dispatched and accepted after sale services are also provided.

2.11.8 Brand

The only brand they have right now is SUPER TAJ MAHAL

2.12 The Division of the Department’s customers

The department has customer in four major regions namely Lahore, Karachi, Faisalabad,
Multan

The names of the customers in every region are Lahore KRML, Barkat Textile , Colony
Textile, ICC , Zephyr, Sapphire, Nishat Chunian, Amjad Textile, Sameen Textile, Shahtaj
Textile. Karachi Saya Textile, Al-Raheem, Gul Ahmed, AL-Karam. Faisalabad Zafar
Farooq, Sagheer Textile, Yaseen Textile, Munir Pasha, Afzal Bhola. Besides there are traders
in the market that invest in yarn and sell it in the market themselves. Multan Masood
Fabrics, Roomi, Hussain Textile, Fatima, Ahmed Fine, Fazal Rehman

3
2.13 The Marketing Department (Export)

2.13.1 The Export Process

The hierarchy is given in Annexure-VII. At first the product description from the client is
attained. Then the greig fabric is attained. The costing of the fabric is done. Finally a sample
is created. Once the sample is created it’s then sent to the customer. Customer checks his
requirement if the sample meets them its ok if not then another sample is made and the
process continues till the sample is approved.

Once the sample is approved it comes back with an order. The order finalization stage is very
important. Buying and selling contracts are signed by both the parties with terms and
conditions written on it. Important terms are shipment date, mode of payment and mode of
shipment.

Once the order is finalized then with the help of PPC processing, stitching and QA programs
are devised.

When the goods are delivered to the customer, A.M. Marketing confirms it from customer.
The customer priority needs are marked and it is noted so that for next order product is
designed and processed according to them.

When the goods are delivered to the customer, A.M. Marketing confirms it from customer.
The customer priority needs are marked and it is noted so that for next order product is
designed and processed according to them.11

2.14 The Shipping Department

Though shipping is a separate department but I studied it in connection with the export
department

2.14.1 Dispatch

When the order gets ready to dispatch, concerned departments inform Marketing people by
reports that dispatch could now be arranged. Then it is informed to shipping department reps.
Shipping employees check the carton and No. of pieces packed in a carton. Notes net weight
and gross weight. Lists are made and compared with the goods to be dispatched against the
customers invoice. Outward gate pass for sending/ exporting goods. Inward gate pass for
receiving goods.

3
Gate inspector makes all reports regarding dispatching or receiving and sends this repot to
finance department. Finance department manages goods/fabric cost regarding incoming
outgoing.

2.14.2 Shipping Department

Shipping Department works on two processes

1. Logistics

Logistics mean shipping department have to manage Transport system within Pakistan and
have to arrange Containers for sending order to Karachi port. Types of Container are 20 FCL
Containers of 28 Cubic meter capacity, 40 FCL Container of 52 cubic meter capacity, High
cube Container for 62 cubic meter capacity.

2. Shipping

Shipping department in KOHINOOR TEXTILE MILL has contract with shipping companies
in advance and when goods are dispatched, Shipping Department informs the. The docs
required for customer clearance are Invoice for value purpose, Packing List, Form E from
KOHINOOR TEXTILE MILL scheduled Bank. (State Bank of Pakistan Requires this
document for Tax Purpose.), Custom clearing agent of KOHINOOR TEXTILE MILL clears
the order by verifying it.

Shipment Company issues Bill of Lading when order is loaded on ship. B/L is sent to
customer for his clearance, Bill of lading, Packing List, Invoice. All communication is
between KOHINOOR TEXTILE MILL’s bank and Buyer’s bank because banks are
responsible for payments and remittances.

Note: If order is sent by sea then B/L is issued by shipping company and if order is sent by air
then Air Company issues Air Way Bill. CAD is received through Bank as mention in Terms
of Payment.

2.14.3 The Bill of Lading

The bill of lading is issued by shipping company when details of order and made order is
handed over to them. The main contents of bill of lading are Vessel/Voyage No., Seal No.,
Container No., Gross Weight, Net weight, Place and date of issue, Consignee (Customer
Bank), Kinds of packages/ Description of goods, Notify Address

3
2.14.4 Follow-up with the customer

When the goods are delivered to the customer, A.M. Marketing confirms it from customer.
The customer priority needs are marked and it is noted so that for next order product is
designed and processed according to them.

2.14.5 Lead Time

KOHINOOR TEXTILE MILL promises its customers a lead time of 8-10 weeks for new
order and 6-8 weeks for repeat orders. The flowchart in Annexure-VIII shows the lead time.

Note: The lead time may vary with the size of the order

2.15 Major Customers

2.15.1 North America

USA Springs Inds, West Point Home, Walmart, Mara Maxx, Sferra Bros, Rose Tree, Ellery
Waverly, American Home, Zantex, Shelinsky & Sons, Macy’s, Bed Bath Beyond. CANADA
Courey

2.15.2 Europe

UK M&S, TK Maxx, Rectella, Tonrose, Marks &Spencer. Germany Klingel, QVC, Leiner,
Neckermann A, Atlas. Norway Stockman, Antilla. Spain Corte Ingles. Holland Hema.
Finland Lutha. Denmark BeirHolms.

2.15.3 ARAB

UAE Textile World. Syria Al-Huda.

2.15.4 Africa

South Africa Wool Worths & Edgars, Australia Target &Myers

3
2.16 PRODUCTS

Sleep and Dream which includes Bed linen, Flat sheets, Fitted sheets, Night frills, Duvets
and Pillows, Duvets, Down proof comforters, Pillows, Fillings, Down proof fabric. Deco and
Style includes Curtains, Printed and ready made, Decorative fabrics, Woven drapery fabrics,
Jacquard and Dobby fabrics, Printed fabric, Fresh and Splash includes Shower curtains
Kitchen and Culture includes, Woven table linen, Napkins.

3
Chapter 03

ANALYSIS

3.1 SWOT Analysis

3.1.1 Strengths

ERP software

ERP (Enterprise Resource Planning) has been installed in KOHINOOR TEXTILE MILL
that’s why company is saving all records in systems and having huge database.

Brand Name

KOHINOOR TEXTILE MILL is one of the major Mills in Pakistan that’s why they have
little bit reputation in local market and having trust from investors. Also they are a renowned
organization as far as the international finished goods market is concerned.

Diverse workforce

In KOHINOOR TEXTILE MILL there are near about 4500 employees who are from
different environments and having different cultures but fortunately there is no cross cultural
communication.

Power Looms

KOHINOOR TEXTILE MILL has purchased latest power looms Toyota Air Jet Power
Looms. That’s why they have reduced the production cost and have increased the quality and
efficiency of their textile products. For yarn they also have auto core and auto cone facilities.

Having own electricity plant

KOHINOOR TEXTILE MILL having own electricity power plant which is producing not
only for the KTML but also providing electricity to other companies and to govt. at subsidy
rate

3
3.1.2 Weaknesses

Administrative Expenses

There are high overhead charges through out the year particularly administrative
expenditures. Management whether it is lower management or upper management, the
expenditures are same but company is getting equally profit from them that’s why
expenditures are increasing.

Reliability on Foreign Customers

Always organization has to rely on foreign customers and it would become risk especially in
financial matters and possibility of fraud would be there. KTML is too much depending upon
their foreign customers. They have limited number of foreign customers but these are also
losing by lacking of quality and little bit high cost.

Employee’s motivational level

The one weakness of KOHINOOR TEXTILE MILL is that their employees are not motivated
that’s why they are getting off and putting their resigns in front of managers and executives.
This is the responsibility of HR department to find out at to see at the time of hiring them that
what the thing is that their employees can be motivated.

Communication Gap

There are a little bit gaps in communication between the departments. May be these confirm
each and every thing from each other but still they make mistakes and blame each others to
safe them.

Team Building

A major problem is team building. There is almost no concept of team. Each person is doing
individually and performing his/her activities. Laborers are so much after the money that they
don’t even care about their peers.

HR Department

HR Department is almost useless and only performing two activities. These activities are
making salaries and attendance of the employees and workers. They are not working to train
the employees and making appraisals to evaluate them.

3
3.1.3 Threats

Political instability

As we all know that the political situation of Pakistan is one of the worst situations of the
whole world. Each new government establishes its new rules and regulations which impact
the industries badly. New elections for Provisional and national assemblies and the major
issue was the murder of BB Benazir Bhutto. Then the new government of Pakistan has
implemented some new rules for the textile industry which are almost of them are not in
favor of the industrialists. These are

a) 31% increment in the prices of Gas

b) Near about 10 rupees per liter increment in price of petroleum

c) Bann to export the raw cotton

d) No subsidy for the research and developments in the textile industry

Against these rules and implications, All Faisalabad Textile Mills boycott in July 2008 by
shutting down their Mills and factories. Now the government has provided them some
subsidy in gas field.

High consumption of petroleum

The high consumption of the petroleum is also the major issues because in international
market, their prices are going up and touching sky, due to which the freight costs are
increasing day by day and hence the cost of production, is also increasing rapidly which is
becoming the reason of losing foreign customers of Pakistan.

Employees

Kohinoor Mills limited is facing a major problem of their employees because they getting off
from KOHINOOR TEXTILE MILL. They think that they are not getting reasonable and
valuable salaries and incentives from the company. The major reason is also that company is
losing its value and reputation in the local market as well as in international market, that’s
why they are getting off from the company to secure their future and present as well.

3
Shortage of power

The government of Pakistan still unable to provide the required quantity of electricity, the
usage of electricity has been increased. The companies who have their own electricity plants
are save but those who don’t have are facing a major problem of shortage of electricity.

Increment in freight charges

The prices of petroleum have been increased and still increasing rapidly. That’s why the
freight charges have been increased and the cost of productions has also been increased by
the huge amount. Due to these increments, the sale price has also been increased but
customers are not ready to pay more for a good quality instead of better quality. And
transport companies are demanding more increments to use their transportation services.

Poor Research & Developments

KOHINOOR TEXTILE MILL has not been working for better Research and Development
Department for some years. They are not focusing to improve their technology and expand
their market share. They just keep focus on their current systems which are producing not too
much good quality products that’s why some of foreign customers are dissatisfied from them
and shifted towards other suppliers.

Lowest price of fabric in world for USA & UK countries

This would surprise for all of us that Pakistan is offering lowest prices the UK and USA
market. Sorry to say that these prices are coming down gradually due to lower quality
products and services. In USA the price per meter is $0.91 which is the lowest price in
compare with other international and especially Asian Suppliers.

3
3.1.4 Opportunities

Motivating the employees

HR department can prove and show them they are here for employees by motivating the
employees performing their best. They can find the motivation level of their employees and
give them incentives to motivate them.

Online Shopping Store

KOHINOOR TEXTILE MILL can open its online store where they can show their garments
variety and apparels. The advantages of this step would be Online Marketing ,Capturing the
market over internet internationally, Capturing the market over internet locally

New Technology

The technology has been improved for the textile industry and these technologies are being
acquired by the international competitors as well as by local competitors so they are
producing good quality textile products and increasing the efficiency as well as decreasing
the cost of production. KTML has the opportunity to invest for the new technology. By
acquiring the latest technology, they can increase the production quality, efficiency and can
decrease the cost of production.

3
3.2 PEST Analysis

3.2.1 Political Factor

As we all know that the political situation of Pakistan is one of the worst situations of the
whole world. Each new government establishes its new rules and regulations which impact
the industries badly. New elections for Provisional and national assemblies and the major
issue was the murder of BB Benazir Bhutto. Then the new government of Pakistan has
implemented some new rules for the textile industry which are almost of them are not in
favor of the industrialists. These are 31% increment in the prices of Gas, Near about 10
rupees per liter increment in price of petroleum, Bann to export the raw cotton, No subsidy
for the research and developments in the textile industry

Tight monetary policy also creates a lot of hurdles for textile sector and exporters, and rapidly
growing interest rates of the banks is causing the shut down the power looms, and it also
crushing down the textile industry and exporters, added sources. The industrialists rejected
the imposition of 10 percent withholding tax on electricity bills, small and medium industries,
and power looms, while they demanded withdrawals of 10 percent withholding tax
immediately for the survival of the industrial sector of Pakistan. Then again, the government
is failed to decrease the every day increasing trade deficit. Textile sector of Pakistan
contributes huge amount in the economy of the country serious measures are needed for its
revival.

3.2.2 Economical Factor

The main problem with the textile industry is shortage of electricity, gasoline and petroleum,
due to which Textile industry is bearing too much cost that why they have to increase their
prices to earn profit or for break-even. There are some companies which have their own
electricity plants but they have to spend a lot of money to run them.

Other problems which are faced by the textile industry of Pakistan are

a) Not availability of skilled labors.

b) Labors cost is increasing rapidly

c) Loosing quality of its products in both markets domestically and internationally

d) Poor monitory and Fiscal policies of the Govt. of Pakistan

3
e) Uneducated people

f) Investors are pulling out their capital from the market quickly

g) Foreign Investments are not coming towards Textile industry

These are the factors which are disturbing the textile industry strongly economically.

3.2.3 Sociological Factors

Textile industry affecting the society and environment in number of ways, some of them are
mentioned below.

a) Polluting the air by pushing out ruins of chemicals. Different gases in air react with these
ruins which become dangerous for human beings.

b) No proper system to throw out the useless materials and chemicals.

c) Most of the useless materials and acids are thrown into the fields which are react or
disturb the agricultural products seriously.

d) Since the cost of the production and labor cost are increasing day by day. That’s why the
final product cost is also increasing that’s why people are buying low quality products
and not spending too much to purchase.

e) Textile companies are firing the labors and employees as well because of high production
cost and salaries that’s why the unemployment rate is increasing day by day which is not
good for the industry as well as for the country.

3.2.4 Technological Factor

The technology has been improved and updated in the textile industry of Pakistan and some
of the companies in textile industry are acquiring these technologies. By using new
technology not only they improve their quality and efficiency but also improve their
production as well as reducing the cost of production.

3
3.3 The Recent Floods

Talking about the recent floods, it jolted the industry once again as the cotton got wiped out
due to the flood. Add fuel to the fire India played its part and increased the export duty on the
export of raw cotton. Its not only going to increase the production cost but it will make the
textile industry lose its market share.

3
Chapter 4

Conclusion and Recommendations

4.1 Conclusion

To conclude I am in a position to say that overall it was a wonderful experience. I learned a

lot, the staff and employees were so cooperative and catered me every bit of their experience
for my learning. Company has its own shortcomings which I mentioned in the report I
submitted there. Following are few suggestions and recommendations for the company that I
think I would have considered if I were the managing director of the company.

4.2 Recommendations

Company Structure

The structure of the company is such designed that there is a broad span of control and with
such that they have centralized decision making. This shouldn’t be like that.

Employee Motivation

I personally believe that motivation is an issue at KOHINOOR TEXTILE MILL. Employees

are merely working just because they do not want to lose the shelter being provided by the
company. Besides they really don’t to work. It’s about time company show some care
towards employees, after they are the most valuable resource for production. The staff is not
given any overtime except if they work on public holidays which is also a de-motivating
factor.

Performance Management

The performance management at KOHINOOR TEXTILE MILL is really an issue. If they can
redesign the performance appraisal system and reward accordingly it would really be a
motivating factor.

Career Growth & Knowledge Management

The career growth at KOHINOOR TEXTILE MILL is really slow. People are working on the
same designations for years. It shouldn’t be like that if they really want to get the good people
going. Knowledge management is also not practiced at KOHINOOR TEXTILE MILL. An

3
employee working for years in the same designation if finally gets promoted, he finds the
situations alien to deal with.

4.3 Suggestions

1. They can advertise in international magazines about their selves

2. Monthly Budget, by making monthly budgets for each department especially for the
commercial department, the late shipments and late purchasing of yarn can be
vanished.

3. KOHINOOR TEXTILE MILL can publish its own local business magazine to
promote their selves

4. The H.R Department should be advanced with every respect not only in making
salary slips but also for the other related issues to be occupied to make efficiency.

5. Can be advertised over the internet (electronic Marketing)

6. By holding the seminars on textile industry and offer to attend the seminars to their
customers

7. International business seminars in multiple countries and offer their products to

already existence and new customers

8. Organize fashion shows in foreign countries as well as in local markets.