Department

of Management


Course Title: Operations Management and Supply Chain

Course Code & Section No.: MGT314.9

Course Instructor: MOF







Operations of Lotto Bangladesh



Submitted by:

Nafisa Kauser – 1712155030
Toybur Rahman Niloy – 1713015030
Adiba Jahin – 1631826030
Belayet Hossain – 1731344630
Shaiaan sakib haque – 1731794630




Submission Date: 22.05.20


Acknowledgement

First and foremost, I would like to thank all our parents for their relentless support during this
prevalent situation. Special thanks to our friend Kazi Abrar Islam, son of Mr. Kazi Jamil Islam the
Managing Director of Express Leather Products. Ltd, who has been overseeing the operations of Lotto
Sport Italia in Bangladesh, for allowing us to visit their factory in Gazipur. My deepest appreciation to
all the group members who supported in completing the report. I would finally like to express my
sincere gratitude to our Management Instructor, Mr. Mofassel Hossain Sir for his able guidance,
comments and suggestions throughout the course project without whom this would have been
impossible.

Table of Contents

EXECUTIVE SUMMARY 1

OPERATIONAL ANALYSIS OF LOTTO BANGLADESH 4

STRATEGIC AND COMPETITIVE ANALYSIS 4

DEMAND FORECASTING 5
STRATEGIC CAPACITY PLANNING 6
PROCESS SELECTION 10
QUALITY MANAGEMENT 11
INVENTORY MANAGEMENT 12
SUPPLY CHAIN MANAGEMENT 12
ENVIRONMENT SUSTAINABILITY 13

IMPROVEMENT PLAN 14

RECOMMENDATION 18

REFERENCES 19

Executive summary

This report is based on the lead time improvement plan of Lotto Bangladesh operated by Express
Leather Products Ltd. Throughout this report, we discussed how Lotto Bangladesh executes and
operates their production with respect to reduce and improve their lead time.

The primary information was collected by having a session with the factory manager of Express
Leather Products. In addition, some of the references from the internet and their official website was
used as the secondary information source.

This report provides an overall preview of how Lotto Bangladesh conducts strategic analysis, forecasts
demand, how they manage their inventory, supply chain and also how they are maintaining their
environmental sustainability.

Overview of Lotto Bangladesh

AN EXPRESS JOURNEY WITH LOTTO
Since 2012, Express Leather Products Ltd has had the Bangladesh license to the Lotto brand, becoming
the fastest growing Lotto Licensee, with the greatest turnover per capita globally. Express Leather
Products Ltd has taken the brand from introduction to its current position as one of the premier
football brands in Bangladesh. (Lotto Bangladesh, 2017)







About Lotto Bangladesh
The factory of Lotto Bangladesh initially started with 5000sf, and now it has increased to 7000sf. It has
been growing at a faster rate than once expected and had the highest growth in 2019. It has a total of
550 workers including the 20\21 in the management staff and has various departments such as -
• Finance
• Accounts
• Costing
• Product Development
• Purchase
• Quality Development

Lotto is basically a franchise in Bangladesh which is mainly focused on footwear and the targeted
segment are the male young generation. Their moto is to serve the customers with a footwear which
is light comfortable and light-weight.
Also Lotto Bangladesh is merging with Lee Cooper and the official launch will be within 6 months.

Business Details
Lotto was established in 1973 by the Caberlotto family in Montebelluna, Northern Italy, made its
debut as a sports footwear manufacturer. It produces sporting and casual clothing and footwear.

Business Model
Lotto is an Italian franchise. Since 2012, Express Leather Products Ltd has had the Bangladesh license
to the Lotto brand, becoming the fastest growing Lotto Licensee, with the greatest turnover per capita
globally.

Products
Lotto product line includes footwear, apparels and accessories.

Location
Factory: Mazukhsn,Pubail,Gazipur, Bangladesh.
Head Office: Tongi-1230

Mission
As a dynamic, innovative sports concern and marketed domestic producer and distributor, with
footwear as Lotto’s core business, to keep the promise of the country where they operate. The
strategy that leads them to do everything imaginable to increase their potential. Making the world a
more economical, progressing world-shattering game, creating an imaginative and synthesized global
group, and achieving constructive results in networks where lotto lives and works.

Vision
Lotto's vision is to "inspire and advance each competitor on the sports planet". Although the purpose
of this is to “do everything imaginable” to increase human potential. They do this by developing games
of the moment, making their items increasingly practical, creating an innovator and individual global
group and where it can achieve a beneficial result in networks.

Operational Analysis of Lotto Bangladesh

Strategic and Competitive Analysis

The market Lotto serves in the design foot are business is incredibly large. Lotto is only serving the
neighborhood showcase which I accept still has a ton of chances to be misused. The interest in the
neighborhood advertisement is additionally high and rising and Lotto has a smart thought of how it
functions because of our experience here. Here Lotto is educated about the anther, what sort of foot
Lotto are individuals lean toward for storm, winter or even to visit the mosque, how much the
shoppers are happy to pay for a couple, etc. The Fashion business relies a ton upon the Lotto climate.
The assortments in stores ought to modify in each 3-4 months.

Lotto has fragmented the market in summer, fall, winter, and spring with the goal that our items are
applicable during the time to our clients. The market has altogether changed as individuals' purchasing
limit as Lotto all as the selection of choices has essentially expanded as opposed to where it was
previously. In the event that Lotto thinks back a few decades’ prior, most children just claimed a couple
of school shoes. They neither had the need for the privilege to have football boots. Those sets of shoes
Lotto re-worn wherever in school, play area, excursions. What's more, presently, there are particular
shoes in the market for all age gatherings, for various events. What Lotto has gained from our
involvement with business, the market isn't the greatest test Lotto has.

On one hand, the market has appealed consistently, and then again, relatively few free and worldwide
market players are working in the nearby market. For me, the most testing part is getting a gifted
workforce for our fund and tasks divisions. There is an absence of good ability and gifted
administrators which is the reason Lotto is attempting the best to create aptitudes in retail the
executives among our staff. Another test is finding the correct stores at a sensible cost. In Dhaka,
shops will in general be exceptionally packed and set in the territory where there's a great deal of
rivalry and high estimating. In Lotto, Lotto advances an energetic way of life. In the present situation
of Bangladesh, there are very few brands around who have had the option to do that.

Furthermore, that I believe is the purpose for our prosperity. Wellness is our center business. To have
the option to fit in that zone Lotto has additionally run a battle as of late called "How about we Run".
Because of the provincial Lotto climate, the Bangladeshi footwear advertise is for the most part
slanted towards shoes and shoes. Henceforth, the Lotto establishment I that needs to present and
sold a larger number of shoes than shoes. The shoes Lotto sold Lotto re for the most part imported
because of the moderately low interest at first. This raised costs, Lotto throughout the years request
began to develop for Lotto sports and Lotto chose to set up possess production line to deliver shoes
locally. Lotto carried a few developments to serve the market, similar to cotton-based summer canvas
shoes ultra-dry tech which makes the attire dry rapidly after an exercise and these are sensibly
evaluated.

Here in Lotto, Lotto has been attempting to develop a culture of advancement, qualities, and great
administration. Lotto acquired numerous creative highlights to upgrade our contributions and Lotto

intend to proceed with this direction into what's to come. Lotto additionally would like to improve
benefits for our staff, as I feel that I have certain obligations towards the individuals who work long
and difficult to fabricate Lotto in Bangladesh. Lotto likewise needs to extend activities and retails to
different pieces of Bangladesh and offer work to individuals in their territories.

As of now, Lotto works 160 stores, and in the coming years, Lotto intends to make it 500. Although
Lotto tries to follow their strategies and competitive analysis that they don’t have to face the lead
time problems and don’t lose their customers in the market and Conveyance of items and related
charges. The items bought will be conveyed to the location showed on the Order by the Client inside
24-48 hours from FiloBlu having acknowledged the Order, at the expense explicitly demonstrated on
the Website before submitting the Request. FiloBlu claims all authority to acknowledge or reject
demands for conveyance past the regions of Italy or Europe. Regardless, for conveyances outside the
regions of Italy, conveyance costs and lead times might be liable to change. Where conveyances are
mentioned to nations not part of the European Union, any import-related traditions cost will be borne
by the beneficiary. Appropriately, Customers are welcome to contact the traditions experts in their
nation in advance to keep an eye on the import costs and on any import limitations.

The lead times for conveyance showed by FiloBlu are just demonstrative and a postponement to the
equivalent, or any conveyance made with resulting split transfers will not qualifies the Client for deny
the conveyance or solicitation pay or reimbursement. At the hour of conveyance, the Client will be
required to check that the quantity of bundles conveyed compares to the number appeared on the
conveyance note and the bundling is flawless, not harmed, or wet or ruined, incorporating concerning
the materials utilized for fixing (sticky tape or metallic tying). Any harm to the bundling or potentially
to the item or any absence of correspondence in the quantity of bundles or the subtleties, must be
informed quickly by showing the idea of the issue on the conveyance note for the item, which will be
come back to the bearer. That’s how they try to follow up their strategies in the market.

Bata and Apex both are the competitors of the Lotto. Both these are shoe manufacturing company.
Both the company’s products are as renown to the worldwide as do the Lotto. Bata is known the
leading shoe manufacturing company in our country on the other hand apex and lotto are in same in
the market. As lotto’s target is to take the leading company of the country, they are more focused on
to competitive Bata and want to achieve the success in the market. These is how Lotto is focused on
their strength.


Demand Forecasting

Market demand of footwear is rising both locally and globally. Rise of dispensable income has created
a huge demand for high quality products. Lotto is an Italian sportswear manufacturer, which produces
sporting and casual clothing and footwear. Demand forecasting is a systematic process that involves
anticipating the demand for the product and services of an organization in future under a set of
uncontrollable and competitive forces. Forecasting is important for financial planning, pricing policy,
manufacturing policy, sales, marketing, capacity planning, expansion and capital expenditure.

Lotto in Bangladesh receives their forecasting from the sales department. Sales department, by
analysing their competitors and consumer’s demand give the feedback 6 months ahead for the
upcoming season. The plan is then forwarded to the merchandising team. Merchandising team along
with company’s product development department, costing department, purchasing department and
finance department conducts a Freezing meeting 2 months before the production process begins.

Demand Forecasting plays a crucial role in the management of business. It helps to reduce risks
involved in business activities and make important business decisions. Lotto estimates the current
demand for its products in the market and move forward to achieve the set goals. Forecasting helps
in making budget by estimating costs and expected revenues also helps to control its production and
recruitment activities. Producing according to the forecasted demand of products helps in avoiding
the wastage of the resources. Supports in making critical decisions, such as deciding the plant capacity,
determining the requirement of raw material, and ensuring the availability of labour and capital.
For supply chain management, demand forecasting is very essential. This information allows Lotto
Company to have enough inventory to fill customer order, avoid unnecessary inventory expense and
plan for price fluctuation. Production plans are determined in advance, to secure raw material and
reduce material lead time by placing the order before hand and receiving it. Production processes are
scheduled to reduce production lead time, manufacture and ship lotto shoes after all materials area
available. This includes manufacturing, sub assembly of products and accessories that impact the
ability to process material into product.

Lotto determines the time period on the basis of its set objectives. Selecting a method for demand
forecasting is an important step depending on the purpose of forecasting, time frame, and data
requirement and its availability. Lotto Company uses statistical method to forecast demand such as
from previous years’ balance sheets and market survey reports.
Accurate forecasts improve profits, lower inventory levels, reduce inventory shortages, enhance
forecasting credibility, increases customer satisfaction and production. This will help Lotto Company
to invest and expand in other sectors of production process.


Strategic Capacity Planning

The aim in strategic capacity planning is the process for balancing every resource, internally, to
determining the very best impact in managing production levels. Therefore, the strategic capacity
planning is an excess of moving and directing key resources available to the appropriate departments
for managing production. The process is to completing the product on strategic mapping from one
phase of the product to another one to reaching the end goal.
Lotto Company has footwear machineries which helps to makes its shoes most reliable in durability
and accessibility. The machineries include:

• PATTERN-MAKING AND CUTTING MACHINERY
Machines and equipment used in the preparation of shoe-pattern in linings and fabrics
cutting.
o Hand-Operated Cutters

Manually operated machine to cut, skiving, trim and operate on pattern templates, working
width 250-450 mm.
o Shoe Last Thermoforming Machines
Thermo-moulding machine to get last shells to draw footwear / upper patterns.
o Leather Area Measuring Machines
The machine running the electronic measurement of the surface of skin or cut parts.
o Die-Cutting Presses
Hydraulic presses to cut leather, sole leather and other materials, by means of dies, kinds of
performed tools. There are several configurations: arm-type clicking press, beam press,
traveling head press, automatic die-cutting system. Feeding device either manual or
automatic.


• UPPER PREPARATION AND STITCHING MACHINERY
o Stamping Machines
Machine used to stamp the identification of shoe upper parts
o Skiving Machines
Machine which reduces the thickness of the leather on the parts that constitute the shoe
upper in accordance to the requirements of the shoe model.
o Toe Cap Attaching Machines
Machines in versions from simple irons, to flat or roller presses for applying cold/hot
reinforcements on the shoe upper.

• SHOE LASTING MACHINERY
Machines and equipment for the shoe upper and insole assembly and stabilization.
o Insole Applying Machines
The machine allows the insole fixing to the last by nail, hook, and glue.
o Toe Upper Forming Machines
Machine for shaping the toe upper; it consists of a heated station for the reactivation of the
toe cup and of a station with aluminium last for shaping the toe of the upper. It makes the
edge of the upper linear and ironed.
o Pulling-Over and Lasting Machines
It provides the shoe upper lasting, particularly focused on the front part of the shoe up to the
last waist. The glue is applied by fixed injectors or moving nozzle or their combined action. A
series of adjustable clamps maintains a perfect pulling and positioning of the upper on the
insole. The operating cycle operating is completed by two plates that fold down the upper
edge to the glued insole

• FINISHING MACHINERY
Machinery and equipment to clean and polish shoes before packing and packaging.
o Brushing Machines
Machine equipped with rotating brushes of several types, suitable to remove dust, apply wax
and polish the skins.
o Stamping Machines
For printing trademark or alphanumeric on lining, shoes, uppers.

o Seam Beating and Ironing Machines
Machine is particularly suitable to beat and iron the stitching and close the cut of the lining
after trimming on finished shoe.

• SYNTHETIC MACHINERY AND MOLDS
Machines and plants for the production of shoe parts and soles through injection or pouring
of synthetic materials into suitable moulds.
o Thermoplastic Injection Machines
Plant in which the plastic material is melted and injected into a mold made according to the
negative to be produced. It consists of an injection unit and a clamping unit. The injection unit
has the task of heating, and then laminating the material and push it inside the mold, thanks
to the action of a piston or a screw; while the closure unit has the task of keeping the mold
closed.
o Rubber Injection Machines
Process for direct moulding vulcanized rubber by injecting-pouring while the mold is closed
for outsole inserts production or injection of rubber soles onto uppers.
o Pu Injection Machines and Pu Pouring Machines
System for processing polyurethane by injection. The polyol and isocyanate are mixed by
the injection screw before being pushed inside the mould. Can be adopted for the direct
injection of soles on the upper. System for processing polyurethane by pouring. The material
flows down from the pouring head that is moved up the mould.
o Tpr Injection Moulding Machine
Thermoplastic rubbers (TPR) are used extensively in the footwear sector for the production of
various types of soles, shoe platforms, wooden soles and rubber boots. The main advantages
of TPR are: Easy and economic processing.
o Moulds
Specially designed block composed of two or more half-shells, which go to delimit an area of
space with the outline of the piece to be obtained by injection.

• EQUIPMENT AND ACCESSORIES
Machines for laboratory tests, tools and devices as support of the machines operating in the
shoe manufacturing
o Laboratory Test Equipment
Machinery and equipment for quality control laboratory (physical and chemical test) of shoes
and their components. The tests are performed according to regulatory and/or precise
standards methodology such as ISO (International Standard Organization)
o Chemicals
Chemical compounds to implement shoe components or for shoe finishing.
o Preforming Moulds
Moulds for shaping insoles, counters, soles in different materials and types.
o Adhesives
Adhesive, substance or mixture of natural or artificial substances, as interface between the
objects surfaces that successively will be put in contact, it keeps them glued when the pressing
force is removed. The classification can be solvent or water based.

o Boards for Die-Cutting

Plate used as support for the material being cut by mechanical pressing of the die. The various
resistances or hardness is related to the material which is composed the object. Widely made
by nylon.


















Fig.: Sewing Slipper Line Fig.: Stamping Machine

















Fig.: Thermoplastic rubber used to

make soles


Lotto is a sports footwear manufacturer. Express Leather Products Ltd, in Bangladesh has the license
to the Lotto brand. Becoming the fastest growing Lotto Licensee, with the greatest turnover per capita
globally. Lotto’s journey began by showcasing their Italian style footwear. It has competitors such as

Bata and Apex in Bangladesh with massive customer attraction. Lotto with existing competitive forces
has managed to establish a brand image with customer satisfaction. Strategic capacity planning helps
in improving the product quality and reduce lead time, ensuring adequate capacity required for
production process. Lotto footwear manufacturing unit maintains capacity which results in increase
in output to fulfil market demand. Lack of capacity can increase lead time which can be a downside
for the company. If the demands are not satisfied Lotto has a chance of losing its customers to the
rival footwear manufacturing companies. Capacity depends on resources, and the resources are
bought with money. If there is excess capacity, it indicates that there has been inefficient expenditure.
Then scope of investment in sectors such as transportation, innovative new technologies and
machineries are likely to decrease. This can increase lead time.

Therefore, to reduce lead time Lotto footwear manufacturing factory has taken several
measures. Lotto is focused on sports accessories, it works to continuously innovate and match
people's lifestyles. Lotto has introduced Lotto Works -- the European standard shoes that prevent
workplace accidents. Lotto product lines are set up with scientific formulas, machineries, skilled
workers and necessary tools required for quality management, focusing on every detail. The Lotto
retail channel management includes regular open-to-buy planning that provides guidance on how
much to buy and benchmarks for evaluating progress, thus adjusting future plans. Lotto has a diverse
product line including various types of shoes (running, casual, football, tennis, cricket, basketball, etc.).


Process Selection

I. Reactivearch - The first dynamic sole with a concave form. It moves
in unison with the natural deformation movement of the transversal
arch and then it favours the elastic return of the forefoot. (Lotto
Bangladesh, 2017)

II. Syn-Pulse – Syn-Pulse system has been developed to fully
support footwork of athletes and to meet their cushioning
needs. (Lotto Bangladesh, 2017)

III. Stratosphere – Stratosphere is Lotto’s new proprietary technology, created
to provide even higher standards of cushioning and elastic return for tennis
players. (Lotto Bangladesh, 2017)


IV. AMF – New Adapto Memory Foam insole, designed with
a material that adapts to the foot, absorbing impact and
supporting the sole, facilitating a great feeling of comfort
during all types of activity. (Lotto Bangladesh, 2017)

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V. Dry Out Tech – Dry Out Tech is a system of grids and

breathing holes which can be positioned on the upper or
in the sole to ensure complete breathability. (Lotto
Bangladesh, 2017)


VI. Enerturn – Enerturn, shock absorption system in multiple-
density elastic material which disperses the negative forces
of impact and returns the accumulated energy to the player.
(Lotto Bangladesh, 2017)


VII. Foot Arch Support – FAS is a medial stabilizer which ensures correct
torsional elasticity. (Lotto Bangladesh, 2017)




VIII. Punto flex – Punto flex is a special technical device which allows
the foot to flex correctly and gives an excellent elastic return.
(Lotto Bangladesh, 2017)



IX. Ultralight – System of innovate technical solutions in
developing the sole and upper, guaranteeing lightness and
reactiveness. (Lotto Bangladesh, 2017)

Quality Management

The raw materials imported and locally collected are sent to the lab located in the factory by cutting
a sample from each. The operators then set the sample onto the machine for testing. For instance,
they check the material for how many steps it takes to have a mark on it or tear up. The operators
conduct this test for a day or two. They tend to leave the sample on the machine overnight and and
the machine automatically stops when the sample tears up or have a mark on it; and shows the
number of steps it took on the screen. Lotto uses various automatic machineries that continues to do
the checking by every means before they let the product into the market.

Once the articles are produced, they are again checked and the managers quarantine that batch where
a defected product is found. The chance of rejection of a product is 1 out of 100. And the rejected
products are then sold at half price which they call as the “B Grade”.

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Inventory Management

The materials are stacked on several racks. Each rack has an individual serial number which have a
separate entry given into the computer. When a requisition of a certain amount is made, the store
manager receives the receipt signed by the managers concerned for the operation and provides that
amount right after. If the materials run out of a certain set level, warning goes to the store manager.
The store manager then checks the future needs of that particular material and orders accordingly.
The inventory floors are open from 8:00 am – 5:00 pm.


















Fig.: Inventory Racks


Supply Chain Management

Supply Chain Management (SCM) is a significant piece of each association, regardless of whether little
or huge. SCM is the dynamic administration of inventory network exercises to amplify client esteem
and accomplish a reasonable upper hand, it additionally manages the development and putting away
of materials expected to make an item.
Lotto Bangladesh has both local and foreign suppliers. Foreign suppliers include China, Italy, Vietnam
but due to the pandemic, COVID-19, they are suffering a significant amount of loss i.e. 25,000 pairs of
footwear were in order for Bangladesh Navy which had to be postponed for an unknown time period.
The Lotto Manufacturing company is going upward to the business but since their venture is quite
new recent, as started since 2012, they have a long way to go to properly implement a suitable and
organized supply chain management in order to better operate the whole process.

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Environment sustainability

Sustainability is the capacity to address the issues of the present without trading off the capacity of
people in the future to address their own issues.

This is the meaning of sustainability as made by the United Nations World Commission on
Environment and Development. While it isn't all around acknowledged, the UN's definition is quite
standard and has been extended throughout the years to remember points of view for human needs
and prosperity (counting non-financial factors, for example, instruction and wellbeing, clean air and
water, and the assurance of regular magnificence). Plainly the capability of our drawn-out
reasonability of prosperity on this planet has to do with our support of the normal world and its
common assets.

Bangladesh government is forcing the industries to have the sustainability of the environment. The
industries are going through the govt. order to save the environment. But in this case lotto is not going
fast as the instruction. If lotto suffers to maintain the instruction it will basically affect to every part of
the business in negative way. Government have puss red button on their company and they will have
the problem to open the business in new ways to maintain the sustainability problem and thus how
they will be far behind to fulfill their customer demands which is basically a lead time problem. If they
do not follow or cope up with these things, they have to face the laws and basically the green earth is
preferable to the people as so if they can do the things, they will have the strategies to come forward.
They have to control and lessen ecological stream; Implement and apply squander the executives’
chain of command; Handle, store, treat and arrange fitting; Prevent ground water and land
defilements; Account for carbon discharges; Reduce carbon discharge. Then again, for maintainability
improvement underneath things are required environmental dynamic Implement mechanical
grouping and asset pooling Undertaking hazard appraisal (natural and business) Identify, create and
execute business cases for maintainability improvement

Supportable assembling structure required to accomplish natural maintainability for green earth. It
can accomplish by following beneath ways:
Vitality productivity → Reducing vitality utilization → Maximize elective vitality assets
Water productivity → Reducing water utilization → Maximize elective water supply
Material productivity → Optimizing material stream and utilization → Manage stock and acquisition
Successful natural administration framework, upgrade examining and ecological checking execution
and conform to natural frameworks are fundamental to improve the executives rehearses. Bangladesh
industry proprietors are particularly worry about business maintainability. Consistence industrial
facilities are actualizing various prescribed procedures to improve their proficiency and
maintainability. Maintainability has a more extensive viewpoint than consistence. Bangladesh industry
needs an extensive procedure to be manageable for ecological issues. Both industry proprietors and
strategy creators need to comprehend the worldwide effect of creation and utilization designs.
Manageability must be advanced inside the business, which isn't as print as opposed to a long-distance
race. So, in case to have their business run they have to do improve on the environmental
sustainability side for the and by doing the above steps they can ensure the environment sustainability
and run with their flows. If lotto can do maintain the things and come with this plan into their business,

13


they can have the earliest lead time feedback also. Bangladesh Govt is strict on the environment issue
and lotto has to think about the welfare and have to come with in the solution and keep their
wastages, chemicals and etc. into a proper way to maintain a good environment.


Improvement Plan

1) Use a domestic supplier- Majority of materials have to Imported to make a specific product. This
increases cost of production and also increases lead time since the workers have to wait for the
raw materials to arrive. An alternate to this would be to use a domestic supplier instead of an
imported one. The company should maintain good communication and good relationship with the
company they will buy the raw materials from which will create a good bond and also it will help
the company in times of uncertainty. This will decrease lead time as the workers do not have to
wait for the products to arrive and they can start the work immediately. This will also increase
profit since the company can buy the raw materials at a cheaper rate.

2) Increase order frequency- Some of the materials have to be imported and there is no alternate to
that. In order to decrease the lead time the company can order in large frequencies which is more
than their normal amount so that the company can still deliver goods to its consumers even when
there is a change in customer preference. This will cause the lead time to be stable and in some
conditions even decrease it.

3) Maintenance of equipment- Any equipment failure on the factory will increase the lead time since
all the equipment’s are interconnected with each other. Regular maintenance is required so there
is no sudden equipment failure. Two types of maintenance are condition based and predictive.
These needs to be implemented if a system shows any indicator that isn’t producing to its
maximum potential. Drastic changes and maintenance need to take place then and there so that
the equipment doesn’t fail afterwards. Regular maintenance will ensure no failure and will keep
the processes smooth and will decrease lead time.

4) Improve forecasting procedures- forecasting producers are critical to any company and
specifically to lead time. If a wrong forecasting technique takes place or a simple misinterpretation
of a data the whole company may incur loss and produce goods which may not be in demand later
on. To improve and to make sure that the forecasting techniques are accurate the company should
hire more professionals in the marketing sector. They should also analyze their order history to
sense any changes to take place, track any promotional offers implemented by their competitors
and also look at the current marketing conditions and which products will the consumers want
more in the near future. If the forecasting techniques and procedures are successful then the
company will have a decrease in its lead time and generate profit.

5) Marketing- Marketing is a critical for any modern business now and if the marketing is successful
and appealing consumers will want to buy your product and there is simply no way around it. So,
the marketing department should consist of professionals who will only want what’s better for

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the company so that the product can reach new levels. Lotto currently follows a few popular ways
such as:

i) Discounts- they offer discounts to their consumers on off seasons which attracts the
consumers and generates sales for them
ii) Buy 2 get one free- this is also very popular in Dhaka. People get the opportunity to
buy 2 products and get one additional which they give it as a gift or keep it themselves.
iii) Cash back offers- The Company also has affiliations with banks and do offer cash backs
if credit cards are used. These acts as an incentive for consumers to buy more
products and can be considered as a good strategy to attract consumers.
iv) Brand ambassador- The Company has Mushfiqur Rahim as their brand ambassador
who is considered one of the best cricketers of this generation. Since he has a good
public image and has a good amount of devoted fans who just want to be like him
they also would want to dress like him. So this helps them to attract a lot of consumers
which helps them to generate profit.
















Fig.: Mushfiqur Rahim being recognized as the brand

ambassador of Lotto in 2017



However, the marketing department can still be updated and improved so that the company gains
more profit and has a decrease in its lead time. Some of them are listed below:

ü Know the target audience - The companies main target audience is the youth and the working
people. They should keep in mind what strategies to develop so that it satisfies them for which
the can gain more consumers and in turn have more profit.
ü Know your competition - The primary competitor is Bata so they should know what they are
offering and try and find ways to beat out Bata by emphasizing on their competitive
advantages.

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ü Unique selling point - They should publicize their unique selling point which at this case is the
cost and the durability. If people get to know more about their unique selling point, then
people will have more knowledge about their product and hence buy more from it.

6) Consolidate debt - Make sure that debts are always paid so that when time comes when you need
excess money you can just take a loan from a bank which they will approve considering you have
your previous loans covered.

7) Consumers should be able to pay in various ways. Ways such as Bkash or rocket, credit or debit
card or simply paying cash. If there are more ways to pay, then consumers will simply want to buy
products even if they don’t have immediate cash with them.

8) Eliminate risks and reduce hazards- a single hazard to an employee may increase lead time as the
automated machines have to be looked on by an individual. The risks which may arise from the
working conditions need to be kept on mind and afterwards be evaluated. After it has been
evaluated the company can take the necessary precautions to prevent and accidents which occur
in the workplace. If accidents are prevented people will be assured of their safety and will be more
determined to complete their work which will in turn decrease lead time an increase profit.

These need to be followed so that the company can be in a strong financial situation at all times and
can take advantage when other companies are slacking off. These will help the company gain profit
and be prepared for any situation and this will also reduce lead time.


Some drawbacks include:

1) Majority of the Materials have to Imported- since the materials which are used are not
produced locally it has to be imported. 90 percent of the materials are imported which
ultimately increases the cost of production. This also increases the lead time as the factory
workers have to wait for the arrival of the materials which consumes time.

2) China is the main importer- the global pandemic first originated in china so the materials
which are imported have been in a halt for some time now. Since no materials have been
imported for quite some time now, the entire production is on stoppage, which means the
company is not being able to meet their goals and are incurring losses.


3) They are not diversified- they only produce footwear and that too for males. Even though they
have entered the clothing market it has not made such an impact since it’s only in the
introduction state. Since they are not diversified and the market cycle changes quite often, if
someone orders a different product with different features they might not be able to provide
it within the normal time span and this will also increase lead time.

4) Constant change of consumer preferences- since the footwear market is very dynamic
consumers have a change in their preference quite often.

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5) Equipment failure- the company is heavily reliant on automated machines and if one does not
operate the entire operation will fail causing major inconsistencies. And if one machine fails
to operate the whole procedure will be in a standstill and as a result will increase the lead
time.

6) The forecasting technique used might be inaccurate- it is not always possible to have an
accurate forecasting. And if there are slight inaccuracies the loss might be irreparable, and
certain products which will be demanded by the consumers will not be made at the specific
time which will increase lead time which will lead to company loss.

7) Financial problems may arise- Cumbersome process, untimely loan, less subsidy, high rate of
interest especially in Bangladesh may be a huge problem to tackle. And if the financial
situation of the company is not good at a specific time then the company may not be able to
buy raw materials which will be required for the production process increasing lead time.

8) Occupational hazards- factory associated works may be very dangerous since the risk is very
high. A slight loss of concentration may be life threatening. And if a single member of the
workforce is left injured then the whole production process may be slowed down since the
automated machines need to be looked by a specific person. The whole production process
will require some time to be back on track and that will contribute to a loss of time which will
increase the lead time as a whole.

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Recommendation

o The company should undertake sufficient investment in fixed assets and raw materials to
maintain the optimum level of production.
o The administrative costs must be reduced by means of tight cost control systems.
o Higher sales growth needs to achieve.
o Pricing should be more competitive.
o The company should also produce footwear for kids and female customers

Maintaining its legacy of customer satisfaction by delivering innovative design and quality footwear
to satisfy the needs of people. From the analysis of Lotto Sport Italia and the shoe industry we have
identified that the shoe industry is growing and identified their main weakness is insufficient lack of
development with the rapid changing market needs, insufficient promotional activities, and
downward trend of quality. On the other hand, distribution system and vertical integration are the
strengths of Lotto from strategic marketing viewpoint; we see that it is taking corrective steps in
almost all the way. In very few sides Lotto has lacking. Based upon these facts recommended
strategies would assist in more growth of Lotto footwear company in Bangladesh among the upcoming
fierce competition in the shoe industry.

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Reference

Lotto Bangladesh. (2017, January 3). Lotto . Retrieved February 26, 2020, from Lotto Bangladesh:
http://www.lottobangladesh.com/

News-Desk, A. R. (2018, November 28). Retrieved from The Daily Star:

https://bd.apparelresources.com/business-news/retail/italian-sportswear-brand-lotto-double-
stores-bangladesh/

Rahman, O. (2014, January 14). Retrieved from The Daily Star: https://www.thedailystar.net/getting-
lotto-6542

Roy, S. (2015, August 11). Retrieved from The Daily Star: https://www.thedailystar.net/business/lotto-
focuses-design-innovation-grab-market-124876

Group - 06

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