GLOBAL BUSINESS SCHOOL, HUBLI – 580025

Academic Year: 2019-21

Submission of Assignment / Project
“Clothing Store (Grace fashion wears)”

Semester : IV

Division : Athens

Subject : Management Control System

University Seat No Student Name

19MBA178 Amit Janagouda

19MBA241 Priyanka Pawar

19MBA281 Vinay Upadhye

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 TABLE OF CONTENT
Introduction 3
Vision, mission, objectives 4
Organization structure 5
Jobs and responsibilities 6-9
Responsibility centers 10
Budgeting 11
Controlling Principles 12-13
Performance measurement and control 13-17

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Introduction
The clothing store (Grace fashion wears) industry comprises of small retail stores that sells a
limited range of clothing and accessories. The industry is defined as single-establishment
stores only. Clothing stores (Grace fashion wears) can be strictly designer based (i.e. only one
designer’s collection is sold there), or they may sell a mix of designers’ labels (brands) that
are specifically catered to the local market.

Players in the Clothing store (Grace fashion wears) industry are defined as having only one
location and typically focus on providing high-end or niche products to consumers. Changing
fashion trends and of course consumer well-being is essential to industry growth because
products are generally more expensive and rely on consumer discretionary incomes.

The industry is projected to grow at 3.1 percent annual growth rate. Over the years, clothing
stores (Grace fashion wears) have experienced tremendous growth in all cities. In response to
the ever-growing demand for clothes and other fashion accessories, clothing store owners
have opened additional stores thereby creating chains of stores across different cities. They
are always ready to expanded into new markets and of course adapt to the ever-changing
trend in fashion and increase sales.

Over and above, the clothing store (Grace fashion wears) industry is a profitable industry and
it is open for any aspiring entrepreneur to come in and establish his or her business; you can
choose to start on a small scale in a street corner like the average mom and pop business or
you can choose to start on a large scale with several outlets (chains of stores) in key cities.

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Vision

To be the best brand in Apparel retailing

Mission

To make people feel good and look better.

Objectives

 Quality product and good relationships with customers.

 To maintain the profit margin 15% to 20% through close attention to expenses and
cost of goods sold.
 To drive and build sales.
 To open the branches in all over India.

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 Chief Executive Officer

Merchandize Sales and Marketing Information

Store Manager
Manager Manager Technologist

Line checker Accountant

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Job Roles and Responsibilities
Chief Executive Officer – CEO (Owner):

 Increases management’s effectiveness by recruiting, selecting, orienting, training,

coaching, counselling, and disciplining managers; communicating values, strategies,
and objectives; assigning accountabilities; planning, monitoring, and appraising job
results; developing incentives; developing a climate for offering information and
opinions; providing educational opportunities.
 Creating, communicating, and implementing the organization’s vision, mission, and
overall direction – i.e., leading the development and implementation of the overall
organization’s strategy.
 Responsible for fixing prices and signing business deals
 Responsible for providing direction for the business
 Creating, communicating, and implementing the organization’s vision, mission, and
overall direction – i.e., leading the development and implementation of the overall
organization’s strategy.
 Responsible for signing checks and documents on behalf of the company
 Evaluates the success of the organization

Store Manager:

 Responsible for managing the daily activities in the store

 Ensure that the store facility is in tip top shape and conducive enough to welcome
customers
 Maintains office supplies by checking stocks; placing and expediting orders;
evaluating new products.
 Ensures operation of equipment by completing preventive maintenance requirements;
calling for repairs.
 Updates job knowledge by participating in educational opportunities; reading
professional publications; maintaining personal networks; participating in
professional organizations.

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  Enhances department and organization reputation by accepting ownership for
accomplishing new and different requests; exploring opportunities to add value to job
accomplishments.
 Defining job positions for recruitment and managing interviewing process
 Carrying out staff induction for new team members
 Responsible for training, evaluation and assessment of employees
 Interfaces with third – party providers (vendors)
 Control the sales floor inventory
 Ensure that clothes and fashion accessories are properly arranged
 Supervise the entire sales staff and workforce
 Handles any other duty as assigned by the CEO

Merchandize Manager

 Manage vendor relations, market visits, and the on-going education and development
of the organizations’ buying teams
 Help to ensure consistent fashion trend and quality of clothes and fashion accessories
on our rack
 Responsible for the purchase of clothes and other fashion accessories for the
organizations
 Responsible for planning sales, monitoring inventory, selecting the merchandise, and
writing and pricing orders to vendors
 Ensures that the organization operates within stipulated budget.

Sales and Marketing Manager

 Manage external research and coordinate all the internal sources of information to
retain the organizations’ best customers and attract new ones.
 Model demographic information and analyse the volumes of transactional data
generated by customer purchases.
 Identifies, prioritizes, and reaches out to new partners, and business opportunities et al

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  Responsible for supervising implementation, advocate for the customer’s needs, and
communicate with clients
 Develops, executes and evaluates new plans for expanding increase sales
 Document all customer contact and information
 Represents the company in strategic meetings
 Helps to increase sales and growth for the company

Information Technologist

 Manages the organization website

 Handles e-commerce aspect of the business
 Responsible for installing and maintenance of computer software and hardware for
the organization
 Manages logistics and supply chain software, Web servers, e-commerce software and
POS (point of sale) systems
 Manages the organization’s CCTV
 Handles any other technological and IT related duties.

Accountant / Cashier

 Responsible for preparing financial reports, budgets, and financial statements for the
organization
 Provides managements with financial analyses, development budgets, and accounting
reports; analyses financial feasibility for the most complex proposed projects;
conducts market research to forecast trends and business conditions.
 Responsible for financial forecasting and risks analysis.
 Performs cash management, general ledger accounting, and financial reporting
 Responsible for developing and managing financial systems and policies
 Responsible for administering payrolls
 Ensures compliance with taxation legislation
 Handles all financial transactions for the organization
 Serves as internal auditor for the organization

Client Service Executive

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  Ensures that all contacts with customer (e-mail, walk-In centre, SMS or phone)
provides the client with a personalized customer service experience of the highest
level
 Through interaction with customers on the phone, uses every opportunity to build
client’s interest in the company’s products and services
 Manages administrative duties assigned by the store manager in an effective and
timely manner
 Consistently stays abreast of any new information on Mary & Mack Clothing Store™
products, promotional campaigns etc. to ensure accurate and helpful information is
supplied to our customers when they make enquiries

Cleaners:

 Responsible for cleaning the store facility at all times

 Ensures that toiletries and supplies don’t run out of stock
 Cleans both the interior and exterior of the store facility
 Handles any other duty as assigned by the restaurant manager.

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Responsibility Centres
Cost Centre:
A cost or expense centre is a segment of an organisation in which the managers are held re-
sponsible for the cost incurred in that segment but not for revenues. Responsibility in a cost
centre is restricted to cost. For planning purposes, the budget estimates are cost estimates; for
control purposes, performance evaluation is guided by a cost variance equal to the difference
between the actual and budgeted costs for a given period. Cost centre managers have control
over some or all of the costs in their segment of business, but not over revenues. Cost centres
are widely used forms of responsibility centres.

 Revenue Centre:
A revenue centre is a segment of the organisation which is primarily responsible for
generating sales revenue. A revenue centre manager does not possess control over cost,
investment in assets, but usually has control over some of the expense of the marketing
department. The performance of a revenue centre is evaluated by comparing the actual
revenue with budgeted revenue, and actual marketing expenses with budgeted marketing
expenses. The Marketing Manager of a product line, or an individual sales representative are
examples of revenue centres.

 Profit Centre:
A profit centre is a segment of an organisation whose manager is responsible for both
revenues and costs. In a profit centre, the manager has the responsibility and the authority to
make decisions that affect both costs and revenues (and thus profits) for the department or
division. The main purpose of a profit centre is to earn profit. Profit centre managers aim at
both the production and marketing of a product.

 Investment Centre:
An investment centre is responsible for both profits and investments. The investment centre
manager has control over revenues, expenses and the amounts invested in the centre’s assets.
He also formulates the credit policy which has a direct influence on debt collection, and the
inventory policy which determines the investment in inventory.

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Budget
We will be starting the business with the investment of 25 lakh for our initial stage of
business. Then in the business of need to add some investment again than we discuss on the
profit and loss of the company and then decide to whether to invest more or less.

Investment : 25,00,000

Variable Cost:

1. Rent – 10000*12 =120000

2. Current Bill – 1500*12 = 18000
3. service Charge- 2000*12 =24000
4. Material cost- 15.00.000
5. sales expenses-2000*12 =24000
6. Distribution- 1800*12 =21600
sales Cost of 50%on profit
sale
1m= 30000 15000 15000
2m= 35000 17500 17500 Total cost
3m= 38000 19000 19000 17.07.600
4m=42000 21000 21000
5m=51000 25500 25500
6m=55000 27500 27500
7m=60000 30000 30000
8m=65000 32500 32500
9m=69000 34500 34500
10m=72000 36000 36000
10m=78000 39000 39000
11m=85000 42500 42500
12m=95000 47500 47500
Total=775000 = 387500 =387500

Total sale =775000

Total costs= 387500

total profit= 387500

Control systems
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Business deals in trends, styles, and tastes, it’s important to be one step ahead of the demand
curve. Of course, if it were that easy to predict what consumers wanted, everyone would
mortgage their house and go into business

 It avoids stock outs and increases customer satisfaction

 It keeps carrying costs low and prevents retailers from tying up vital capital in things
like storage space and insurance.
 Investors increasingly look at a Store to assess its health.
 Preventing Stock-Outs and Increasing Customer Satisfaction
 Keeping Carrying Costs Low

Strategies

1. Paper Method
2. Spread sheet Method
3. Mobile-Based Apparel Inventory Management Tools

main Advantages of clothing store

 Reduce clothing enterprises’ operation cost:
During the process of clothing marketing, clothing product information distribution
and transmission, product display, the communication with consumers and
advertisement delivery is conducted by the network. Compared to traditional
marketing, its cost is lower with network . At the same time, there is no need to lease
or buy brick-and-mortar stores for clothing enterprises through the implementation of
network marketing. Just use the web to carry on non-store sales.can reduce the cost of
enterprises in leasing or buying stores and employee wage on the one hand.
 Own price advantage and expand clothing display scope
In the virtual marketing, reduce channel cost because the decrease of
middlemen. The decreases of channel cost and enterprises’ operation cost lead
to that clothing product price online is lower than that of brickand-mortar
stores, such as traditional market and brand stores . The cheap price of
clothing product can cause consumers to buy online easily, beneficial for
clothing enterprises to reduce inventory and increase sales. In addition, there is
no limitation of area in virtual stores online; enterprises can exhibit more
clothing than in the brick-and-mortar stores in the condition that they have
enough clothing. Clothing types, styles and color shown can be various,
providing more choices for consumers and attracting consumers’ attention to
buy clothing online. It’s beneficial to increase consumer purchasing
possibility.
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  Improve clothing enterprises’ quick response ability
As epidemic strong product, clothing has a lot of characteristics, for example,
rapid change and short popular cycle . According to the market and
enterprise’s own conditions, clothing enterprise needs to make a quick
response for consumers’ increasingly personalized demands. They can get
feedback information from consumers in a timely manner with using BBS
message and other electronic information communication methods. Based on
the acquired feedback information, the enterprises can quickly adjust the
allocation of clothing products, so as to cater to the market and meet the
demands of consumers in clothing market.
 Provide more promotion activities and meet consumers’ personalized
demands
Due to the limitations of time, space and human factors, it’s almost
impossible to hold on multiple promotions at the same time for one brick-and-
mortar clothing store . But in clothing stores, enterprises can hold many
promotions at the same time. Consumers can choose the promotional activities
based on their actual demands, helping clothing enterprises attract more
consumers and increase sale

Performance measurement and control

Clothing industry can use key performance indicators to identify business strengths and
weaknesses. Companies set performance goals and use the quantitative indicators to measure
their success. Healthy apparel companies use key performance indicators in a variety of
business dimensions.

Performance measurement improves the likelihood the organization will implement its
strategy successfully.

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In MCS, the manager works through others in the following ways

 Ensuring that the work environment is satisfactory

 Deciding where the employees fit best in the organization
 Making sure the employees are adequately trained
 Resolving disputes within the responsibility centre
 Solving problems

KPIs — “key performance indicators” are the most important metrics in your business. These
are numbers that you must regularly monitor so you can determine if your business is on the
right track.

Each clothing business is different, so specific measures may be more significant to you than
others.

Sales metrics and KPIs

Sales are the lifeblood of any clothing business so it’s critical that you keep a close eye on
them.

Conversion rate

The conversion rate is the proportion of store visits to the number of shoppers who made a
purchase

Average transaction value

This metric gives you a general idea of how much people are spending. A high dollar amount
could mean that shoppers are purchasing your more expensive products or they’re buying
larger quantities.

You could derive some insights and action steps from this KPI. For instance, having a low
average dollar per transaction could indicate that you need to rethink your pricing. Or, it
could mean that you have to implement new sales tactics such as upsells, bundles, or other
offers to get shoppers to spend more.

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Online sales relative to brick-and-mortar locations

Consumers today are increasingly using multiple channels to shop, so you need to get a
handle on how your physical presence influences your ecommerce sales. These days,
crediting sales to a single channel isn’t enough, when people are interacting with your brand
in many different ways and places.

Stock turn

Also known as inventory turnover, this metric pertains to the number of times stock is sold
through or used in a given time period

Marketing and Sales Indicators

Marketing and sales performance indicators help an apparel company judge the success of
pricing strategy and marketing campaigns. With the popularity of e-commerce, it's easier than
ever to get quantifiable data. Clothing industry looking to expand into a new customer base
can evaluate the percentage of unique visitors versus returning visitors on their website.

Supply Chain Indicators

Since trends change quickly, apparel companies need to be able to quickly respond to
changing product demands. Apparel companies seek to achieve high inventory turnover
indicators. The quicker apparel retailers can turn over inventory, the more capacity they have
for new products and the less likely it is they have unfashionable, obsolete inventory on hand.

Production Indicators

Clothing industry products should routinely evaluate production indicators. Standard costing
indicators help apparel manufacturers understand variances in production costs, quantity and
quality. They can measure the average defect rate per product to identify areas of weakness.

Financial Indicators

Employees, managers and investors want to make sure their apparel company is financially
viable. Apparel companies often set target financial indicators to increase their stock price or
lure in new investors. Companies can measure their return on assets and return on revenue to
see how well they're leveraging the resources available to them. Apparel businesses that are
seeking long- and short-term financing.

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Standard Allowed Minute (SAM)

SAM helps in capacity planning of the factory.

Perfect Order Fulfilment

The clothing products delivered on time to customers with complete documentation and no
defects. In its simplest (and most traditional) incarnation, a perfect order meets the elements
of a product shipped in full, on time, undamaged and with the right documentation.

Repeated Order

The orders from old customers compared to all orders received Knowing the percentage of
repeated orders is important in forecasting the production schedule

Order Fulfilment Cycle Time

The orders of the garments are fulfilled with the process time required to design, develop,
produce, and transport a garment. Cycle time is the key to competitiveness of a farm as it
affects both price and deliver schedule. It is important to reduce cycle time in order to reduce
costs and improve customer satisfaction.

Sourcing Time

Time spent for sourcing raw material (fabric, trim, accessories, and packing materials).
Knowing the sourcing time is vital for production planning, and providing cycle time
estimates to potential buyers.

Return of Defective Product

defective products returned by customers. The number of defective garments returned to

manufacturers is even smaller. Because most people do not return garments with which they
are dissatisfied, a return by a single customer may represent the dissatisfaction of many
others.  Some manufacturers consider each return representative time period defective
garments.

This can be an indicator of the attentiveness of the Quality Assurance department, and at the
very least represents lost revenue and a degraded reputation.
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These are the key performance measurements which are done in our clothing industry.

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