Project Report

Supply Chain Management

Submitted to:
Sir Muhammad Bilal Raees

Group Members:
1. Syed Burhan Ahmed 760-2019
2. ShahRukh Ashraf 755-2019
3. Muhammad Anas 434-2019
4. Muhammad Tabish 772-2019
5. Hamza Arshad 872-2019
DATE: 26 - October – 2022
 Company: GUL AHMED
Introduction/ Overview:

The story of textiles in the subcontinent is the story of Gul Ahmed. The organization started
buying and selling in textiles in the early 1900s. The organization entered in the discipline of
producing with the status quo of today’s iconic call of Gul Ahmed Textile Mills Ltd in the year
1953. Since its list at the Karachi Stock Exchange in 1970, the organization has been making
speedy development and taking part in a main role in the international of textiles.

With a mounted potential of more than 51,840 spindles, 300 modern weaving machines and
maximum present day yarn dyeing, processing & sewing units, Gul Ahmed is a composite unit –
making the whole lot from cotton yarn to completed products. Gul Ahmed has its very own
captive electricity plant comprising of gas engines, gas & steam turbines, and backup diesel
engines. Believing in playing its function in shielding the environment, Gul Ahmed has
additionally, installed a waste water remedy plant to deal with 100% of its effluent, bringing it
to NEQS levels.
Gul Ahmed is playing a
critical function now no
longer best as a fabric
giant; however, has its
strong presence in the
retail enterprise as well.
The establishing of its
flagship store – Ideas via
way of means of Gul
Ahmed– marked the
organization’s access into
the retail enterprise.
Starting from Karachi, Gul
Ahmed now has an in
depth chain of more than
40 retail shops
throughout the country, providing a numerous variety of merchandise from domestic
accessories to style clothing. More than 50 years considering that its inception, the name Gul
Ahmed continues to be globally synonymous its quality, innovation & reliability.

Supply Chain strategies by Gul Ahmed:

The company has very strong and effective supply chain management; they have the number of
items that are major component of the Textile Industry which are Cotton, Yarn, Gray, Dyes &
Chemicals, Spare parts, Packing Material, Stitching Accessories, General Items etc.
They have very transparent procedure of the procurement of the above items, Cotton is
normally a very specific material and the cotton are trade and fluctuate on daily basis so the
forward purchasing is done from the suppliers to avoid any stock out position. We booked us
cotton on the basis of the orders received from the export and the Local retail shops. The same
procedure applies to the Yarn and the Gray procurement.

Dyes & Chemicals are mainly imported and we have the internationally recognized suppliers
like BASF, Clarian, Daystar, Stork etc. They are the quality suppliers and they are also
recommended by our valued customer as well. For the local purchasing such as chemicals,
Packing material and General Items we get the quotations from different suppliers and evaluate
each of them beside the price negotiations and finally to approved supplier we visit the factory
to check either any child labor or any envoi mental violation is being done at the factory. We
is the quality supplier for our customers so we strive to maintain the best quality?
There is the procurement procedure as follows.

-The request rise from the department or user.

-The user prepares the requisition.
-The requisition review by the Store and if the item is available in stock they issue if not the
asked to raise the indent for the item to purchase.
-The Indent after scrutiny sends to the purchase department to get the rates from the approved
suppliers.
-The purchase order is made and issued to the selected supplier and the supplier sends the
items on the agreed time.
-The Store takes the item in the store receiving document and updates the stock level.
-The Store department then asks for the store requisition from the user to issue the item from
the store.
-After the delivery of the item from the supplier the payment summary is made as per the payment
terms agreed with the supplier and the cheque is issued for the payment to the supplier.
Supply Chain Drivers

Transportation:
The Transportation is used for several purposes and we have the mix of the in-house and
outsourced transportation facilities. We used our own transportation for the delivering to our
retail outlets within the Karachi and for other cities and for fabric/yarn movement within the
different units we have the transport contractors for different locations. We don’t keep the
single contractor to discourage the monopoly.

Inventory Management:
Inventory is the major component of our financial statements and we put more effort to
maintain the inventory for smooth flow of production. We have a full proof inventory
movement system “Inventory Management” system. We are using the weighted average
inventory system for calculating the rates of the individual item. But we prefer to use the FIFO
for the issuance of the inventory to different units.

We are maintaining the minimum stock of every item that tell us about the re-ordering of that
item and we calculate this minimum inventory level by considering the maximum lead time and
the safety stock. We keep the sufficient safety stock in our store for Spears and tool and general
items as the major item are imported that takes more time to import and for Dyes and
chemicals we maintain the minimum stock as per our planning of the next three months’
orders.
As the dyes and chemicals are highly volatile items and they turn into the dead stock after one
year we use prudent approach for these items.

They recommend the average

inventory turnover for the local
dyes & chemicals for two weeks
and for imported dyes & chemicals for four months (based on future orders).

And for Stores & Spares we broken down the items in three categories such as “Insurance
Items” (That could be required any time in emergency and we keep them in stock to avoid any
long stoppage of machines, they normally include the critical parts for the machine and that
could take more than 4 weeks to import. Second one is “Running Items” that are commonly use
spare parts and tool and we keep its inventory as per explain above and all the spare parts,
Tolls and general items are approved in the yearly budgets department wise.

Pricing:
Our Pricing policy is somehow mixed in connection with the Local and export. We use Total cost
plus pricing for export orders that mean we do pre order costing based on sample approved by
the customer and send them for the acceptance. And for Local we have pricing based on the
market. We have the competition in the Local market as well and many brands are running so
that we consider the market before pricing the product.

Distribution:
Distribution channel are different for Local and Export orders, we have our own transportation
for the distribution to the retail outlets in Karachi but for the other cities we have the contract
with the transporting companies to deliver to all outlets outside the Karachi. For export we do
the direct shipment to the customer. The shipment dates and the destination provided by the
customer.

Conclusion:
Gul Ahmed's fine textile products represent a unique fusion of the century old traditions of the
east and the latest textile technology of the west. The purest of cotton fibers, produced from
the fertile lands of the Indus Valley, are spun, woven and processed into the finest quality
cotton and blended products through a combination of latest technology, skills and
craftsmanship of this traditional industry.
To synergize in a perfect way, a high quality product needs all the various processes to produce
something special as a result. In the manufacturing stage at Gul Ahmed, one of the pioneers of
fabric printing and dyeing, this theory is truly expressed. The trained experts strive on their path
to be the best with the new, cutting-edge machines and equipment in use.