Ghulam’s Khairi Center

Fundamental of Operations

GROUP MEMBERS:
SHEEBA ASHRAF

MUHAMMAD AAMIR

WASATHULLAH

Presented to:

Dr. Syed Tariq

NAMAL UNIVERSITY MIANWALI

Table of Contents:
Objective of the Project……………………………………………………………………2

Introduction………………………………………………………………………………..3

Mission…………………………………………………………………………………….3

Vision……………………………………………………………………………………...3

Values……………………………………………………………………………………...4

Product Layout……………………………………………………………………………..4

Inventory…………………………………………………………………………………...4

Process Layout……………………………………………………………………………...5

Processing of the Khairi Formation………………………………………………………...5

Process Selection…………………………………………………………………………...7

Timing for the product manufacturing……………………………………………………..8

Competitive Analysis……………………………………………………………………….9

Operational Strategy………………………………………………………………………..11

Cost-Revenue Analysis…………………………………………………………………….13

SWOT Analysis…………………………………………………………………………….17

Quality Management………………………………………………………………………..18

Capacity Planning…………………………………………………………………………...20

Recommendations…………………………………………………………………………...21

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Objective of the Project:
The main objective of this project is to understand the all operations about the handmade khairi
shoes. This project will help the readers to properly understand the operations of the Ghulam’s
Khairi enter. By using our skills as an Operational Analysts, after the thorough operational
analysis of the Ghulam’s Khairi Center Our objective is to establish Ghulam's Khairi Shoes as
the premier destination for exquisite handmade Khairi footwear, offering a diverse range of
designs while preserving traditional craftsmanship. We aim to exceed customer expectations by
providing personalized experiences, ensuring durability and customer satisfaction. Empowering
local artisans through sustainable livelihoods and actively engaging with the community, we
aspire to promote cultural heritage and leave a positive legacy for future generations.

Ghulam’s Khairi Center

Introduction:
Ghulam’s Khairi Center is a small startup to make the handmade khairi shoes. It is the art which
is done by the generation to generation of the Ghualm Ali. He learned to make the Khairi shoes

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from his father and his father from his grandfather and so on. Ghulam’s Khairi Center is offering
Khairi shoes of different types like Tilay wala, Simple and etc according to the demands of the
customers for various occasions. It is also playing the vital role in the heritage of Mianwali. This
Center is located in Mianwali.

Mission Statement:
"Our mission is to create exquisite handmade Khairi shoes that exceed customer expectations,
inspire confidence, and empower individuals to embrace traditional craftsmanship while
providing sustainable livelihoods for local artisans."

Vision Statement:

"To be the premier destination for handmade Khairi shoes, celebrated for their timeless
craftsmanship, durability, and commitment to preserving local heritage."

Values:

Craftsmanship Customer Satisfaction

Ghulam's Khairi shoes are dedicated to Exceeding customer expectations is a core

preserving and promoting traditional value of Ghulam's Khairi shoes. The business
craftsmanship. Each pair of shoes is aims to provide customers with a personalized
meticulously handmade by skilled artisans, and exceptional experience, addressing their
ensuring attention to detail and the highest preferences and needs to create footwear that
level of quality. inspires confidence and satisfaction.
Empowerment Preservation of Heritage
The business is committed to empowering Ghulam's Khairi shoes are more than just
local artisans by providing sustainable footwear; they represent a cultural heritage that
livelihoods and preserving their traditional has been passed down through generations.
skills. By creating exquisite handmade Khairi The business values the significance of these
shoes, the company supports the livelihoods of traditional shoes and strives to keep the art
these artisans and contributes to the alive while promoting its cultural importance
preservation of local heritage. to customers and the wider community.

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Sustainability Community Engagement
Ghulam's Khairi shoes are committed to Ghulam's Khairi Shoes actively engages with
sustainable practices throughout the production the local community to foster positive
process. The business strives to minimize its relationships and support social initiatives. The
environmental impact by responsibly sourcing business participates in community events,
raw materials, reducing waste, and promoting collaborates with local organizations, and
durable footwear that lasts for a considerable contributes to social causes that benefit the
period. This sustainability focus aligns with the well-being and development of the community.
goal of leaving a positive legacy for future This value reflects the business's dedication to
generations. being a responsible and caring corporate
citizen.

Product Layout:

Khairi shoes

Types of Products:

1. Gittay wala
2. Simple Khairi
3. Tilay wala
4. Pishawari

Inventory:

The inventory for khairi shoes from the Mianwali Bazaar and this inventory come from Lahore. The raw
material used for making the khairi shoes is;

1. Rexene
2. Leather
3. White thread known as “Shaleshan”
4. Nails/Spikes
5. Buckles

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Process Layout:

The mentioned process primarily operates as a batch process; however, it occasionally transitions
into a job shop process. This transition occurs approximately twice a month, prompted by
specific customer requests for their Khairi garments during special occasions such as weddings,
Eid celebrations, and other similar events.

Processing of the Khairi Formation:

1. Material Procurement:

The source is rexene, leather, white thread ("Shaleshan"), nails/spikes, and buckles from reliable
suppliers in Lahore.

2. Raw Material Storage:

Establish a dedicated inventory storage area for the raw materials to ensure efficient management
and easy access.

3. Design and Pattern Creation:

Design and create patterns for each type of Khairi shoe (Gittay wala, Simple Khairi, Tilay wala,
and Pishawari) based on customer preferences and market trends.

4. Cutting and Preparation:

Utilize cutting tools to cut the Rexene or leather material into the required shoe components
based on the designed patterns.

5. Assembly:

Begin the assembly process by stitching together the cut pieces using white thread ("Shaleshan")
and sewing machines.

Add any necessary embellishments or decorative elements specific to each type of Khairi shoe
according to the demand of the customers.

6. Finishing:

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Conduct quality checks to ensure the stitching, alignment, and overall finish of the shoes meet
the desired standards. Trim any excess material and ensure the shoes are visually appealing.

7. Quality Assurance:

Inspect each pair of Khairi shoes for durability, stitching integrity, and adherence to design
specifications.

Address any identified issues or imperfections to maintain high-quality standards.

8. Packaging:

Clean and polish the Khairi shoes before packaging them appropriately to protect them during
transportation and storage.

9. Inventory Management:

Maintain an organized inventory system to track finished products, manage stock levels, and
ensure timely replenishment of raw materials.

10. Marketing and Sales:

Develop marketing strategies to promote Khairi shoes, leveraging social media, and local
advertising.

Engage with customers, provide personalized experiences, and offer customization options when
possible.

11. Customer Service:

Provide exceptional customer service, addressing inquiries, handling returns or exchanges, and
continuously seeking feedback to improve the product and customer experience.

12. Expansion and Growth:

Continuously assess market trends, customer preferences, and competition to identify

opportunities for expanding the product range, entering new markets, or introducing innovations
in the Khairi business.

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EXHIBIT: 1

Process Selection:

The process layout for Khairi shoes formation primarily operates as a batch process, with
occasional transitions into a job shop process. Here's an explanation of each process type:

 Batch Process:

The majority of the production process for Khairi shoes follows a batch process layout.

This means that multiple pairs of shoes of the same type are produced in batches, following a
standardized set of steps and utilizing similar resources.

Each batch typically consists of a specific type of Khairi shoe, such as Gittay wala, Simple
Khairi, Tilay wala, or Pishawari.

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  Job Shop Process:

The process occasionally transitions into a job shop layout in response to specific customer
requests for customized Khairi shoes during special occasions like weddings or Eid celebrations.

In a job shop layout, each pair of shoes is uniquely crafted according to individual customer
preferences, requiring a more flexible approach and potentially involving different resources or
additional steps compared to the standard batch process.

Handmade Condition:

Regardless of whether the process is batch or job shop, it is mentioned that the Khairi shoes are
handmade. This implies that skilled artisans are involved in the production process, using
traditional techniques and manual labor to create the shoes. Handmade production contributes to
the uniqueness and craftsmanship of each pair of Khairi shoes. It's important to note that the
exact layout and the degree of batch or job shop processing may vary based on the specific
operational practices and requirements of the Khairi shoe business. The information we get from
the owner suggests that the business primarily operates as a batch process but transitions into a
job shop process for customized orders, all within the context of maintaining a handmade
production approach.

Timing for Product manufacturing:

The manufacturing duration for Khairi shoes varies depending on the type of design. For simple
or Sada Khairi shoes, the minimum time required is one day to complete a single pair of
handmade Khairi. On the other hand, more intricate designs such as Tilay wala Khairi require a
maximum of four days for the completion of a single pair.

“Most of the customers are loyal rather than random customers.”

Price Range of Shoe:

1000-10,000 rupees per Khairi shoe.

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Durability of Product:

These shoes are designed to withstand various conditions for a period of up to six months. They
are built to be versatile and can be confidently used in environments such as muddy areas, rainy
weather, and dry land without any concerns or hesitation. Regardless of the conditions you
encounter, these shoes offer durability and reliability throughout the entire six-month period.

Competitor:

There is one another competitor in the Mianwali market. The competitive strategy adopted for
this new entrant in the Mianwali market is centered on two key aspects: price reduction and
maintaining excellent product quality. Their objective is to enhance competition within the
market by offering products at lower prices without compromising on their quality. By doing so,
they aim to attract customers and gain an edge over existing competitors. This strategy leverages
the combination of affordability and high-quality products to capture a significant market share
and establish a strong position in the industry.

Competitive Analysis:

The competitor in the Mianwali market poses a challenge for the Khairi business with their
strategy of price reduction and maintaining product quality. To effectively compete, the Khairi
business needs to consider the following actions:

 Pricing strategy:

The business should assess its pricing strategy to ensure competitiveness while maintaining
profitability. It can consider offering different pricing tiers based on product types or introduce
promotional offers during festive seasons.

 Product differentiation:

Expanding the range of Khairi shoe types can help the business stand out and attract customers
looking for unique designs. Conducting market research to understand customer preferences and
trends can guide the development of new product variations.

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  Branding and marketing:

Developing a strong brand identity and promoting the unique selling points of Khairi shoes, such
as their handmade craftsmanship and durability, can help differentiate the business from
competitors. Utilize social media platforms, local advertisements, and collaborations with
influencers or local events to reach a wider audience.

 Efficient manufacturing:

Investing in new machines and equipment can enhance production efficiency, reduce lead times,
and improve overall productivity. This will enable the business to fulfill customer orders more
quickly and compete with the competitor's price reduction strategy

 Customer experience:

Focus on delivering exceptional customer service and personalized experiences to build

customer loyalty. This can include offering customization options, providing after-sales support,
and actively seeking customer feedback to continuously improve the products and services.

Operational Strategies:

Here are some operational strategies for Khairi shoes formation:

1. Efficient Inventory Management:

Implement an inventory management system to ensure optimal stock levels of raw materials and
finished products.

Regularly monitor inventory turnover and forecast demand to minimize stockouts and excess
inventory.

2. Streamlined Production Process:

Invest in new machines and equipment to enhance production efficiency and reduce lead times.

Optimize the flow of materials and minimize handling and transportation to increase
productivity.

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 3. Quality Control:

Implement strict quality control measures throughout the manufacturing process to maintain
consistent product standards.

Conduct regular inspections and tests to ensure durability, stitching integrity, and adherence to
design specifications.

4. Flexibility for Customization:

Offer customization options to cater to individual customer preferences, allowing them to choose
colors, patterns, and embellishments.

Maintain a system for recording and tracking customer specifications to ensure accurate
production.

5. Supply Chain Optimization:

Develop strong relationships with reliable suppliers to ensure a steady and timely supply of high-
quality raw materials.

Evaluate and improve the efficiency of the supply chain, including transportation, to minimize
delays and costs.

6. Skilled Workforce:

Invest in the training and development of skilled artisans to ensure consistent craftsmanship and
attention to detail.

Foster a positive work environment that promotes teamwork, creativity, and pride in the
products.

7. Marketing and Branding:

Develop a strong brand identity for Khairi shoes by highlighting their handmade craftsmanship,
durability, and cultural significance.

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Leverage digital marketing platforms, social media, and local advertisements to reach a wider
customer base.

8. Customer Relationship Management:

Build and maintain strong relationships with customers by providing exceptional customer
service and personalized experiences.

Actively seek feedback and suggestions from customers to continuously improve products and
meet their evolving needs.

9. Continuous Improvement:

Embrace a culture of continuous improvement by encouraging innovation, identifying

inefficiencies, and implementing process enhancements.

Regularly evaluate market trends, customer preferences, and competitor strategies to adapt and
stay ahead.

10. Expansion and Market Reach:

Explore opportunities for market expansion beyond the local Mianwali market by targeting
neighboring regions or online platforms.

Collaborate with local retailers, boutiques, or e-commerce platforms to reach a wider customer
base.

Cost-Revenue Analysis:

The Cost-Revenue Analysis for the Ghulam’s Khairi shoes according to the data which we
collected is following;

Costs:

Raw Materials Cost: This includes the cost of raw materials such as rexene, leather, white thread
("Shaleshan"), nails/spikes, and buckles sourced from suppliers in Lahore. The cost per pair for
each material is shown in Exhibit 2 as follows:

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Raw Material Price in Rupee
Rexene Rs. 200

Leather Rs. 300

White threads ("Shaleshan") Rs. 50
Nails/Spikes Rs. 30
Buckles Rs. 50

 Labor Cost:

The labor cost involves the wages paid to skilled artisans who craft the Khairi shoes. Each pair
requires considerable craftsmanship, including cutting, stitching, assembling, finishing, and other
production-related tasks, resulting in a labor cost of Rs. 500 per pair.

 Overhead Costs:

Overhead costs encompass various indirect expenses required for the operation of the business.
These costs include rent for the workspace, utility bills, administrative expenses, and other
miscellaneous costs. The monthly overhead cost is Rs. 2000.

 Inventory Management Cost:

This includes costs associated with managing and storing raw materials and finished products.
The monthly inventory management cost is Rs. 1000.

 Marketing and Advertising Cost:

The cost of promoting Khairi shoes through various marketing channels and advertisements. The
monthly marketing and advertising cost is Rs. 3000.

 Packaging Cost:

The packaging cost is materials and labor involved in packaging the Khairi shoes for
transportation and storage. The packaging cost per pair is Rs. 30.

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  Quality Assurance Cost:

The expenses related to inspecting and ensuring the quality of the finished Khairi shoes. The
quality assurance cost per pair is Rs. 50.

 Customer Service Cost:

The customer service cost is providing exceptional customer service, handling inquiries, and
addressing returns or exchanges. The monthly customer service cost is Rs. 1000.

Revenues:

The revenue is generated from selling different types of Khairi shoes to customers from 300 to
4000 according to the type s of the Khairi. The sales revenue per pair for each type is in detailed
in Exhibit 3 as follows:

Gittay wala Rs. Up to Rs. 1000

Simple Khairi Rs. 300-500

Tilay wala Rs. 3000

Pishawari Rs. 4000-5000

The Total Costs and Total Revenue based on the provided data are following in Exhibit 4:

Cost/Revenue Category Amount (in Rupees)

Raw Materials Cost 630

Labor Cost 500

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 Cost/Revenue Category Amount (in Rupees)

Overhead Costs 2000

Inventory Management Cost 1000

Marketing and Advertising Cost 3000

Packaging Cost 30

Quality Assurance Cost 50

Customer Service Cost 1000

Total Costs 7210

Sales Revenue - Gittay wala 1000

Sales Revenue - Simple Khairi 2000

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 Cost/Revenue Category Amount (in Rupees)

Sales Revenue - Tilay wala 3000

Sales Revenue – Pishawari 4000

Total Revenue 10000

Net Revenue 2790

The cost-revenue analysis shows that Ghulam's Khairi shoes business has a Net Revenue of Rs.
2790. This indicates the profit earned after deducting all costs from the total revenue. The
positive net revenue demonstrates that the business is generating profits and is financially viable.
However, further market analysis, competitive research, and customer feedback should be
considered to make informed decisions for the sustained growth and success of the business.

SWOT Analysis:

The SWOT Analysis for Ghulam’s Khairi Shoes is following;

Strengths: Weaknesses:
Handcrafted Excellence: Ghulam's Khairi Limited Market Reach: Ghulam's Khairi
shoes are known for their exquisite shoes currently cater to a specific niche market,
craftsmanship, reflecting the skills and potentially limiting their overall customer base
expertise of local artisans. The handmade and growth opportunities.

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aspect of the shoes sets them apart and adds Time-intensive Production: The handmade
value to the brand. nature of the shoes requires a significant
Cultural Heritage: The brand's focus on amount of time and labor, which may limit
preserving and promoting traditional scalability and result in longer lead times for
craftsmanship appeals to customers seeking fulfilling customer orders.
authentic and culturally significant products. Competitor Challenges: The presence of a
Customer Loyalty: Ghulam's Khairi shoes competitor in the local market with a strategy
have a loyal customer base, which indicates the of price reduction and maintaining quality
brand's ability to meet and exceed customer poses a challenge for Ghulam's Khairi shoes.
expectations through personalized experiences
and high-quality products.
Sustainable Livelihoods: By providing
employment opportunities for local artisans,
Ghulam's Khairi shoes contribute to the
sustainability and well-being of the
community.
Opportunities: Threats:
Market Expansion: Ghulam's Khairi Shoes Changing Customer Preferences: Evolving
can explore opportunities to expand beyond its fashion trends and shifts in customer
local market by targeting neighboring regions preferences may pose a challenge to
or utilizing online platforms to reach a wider maintaining consistent demand for traditional
customer base. Khairi shoes.
Product Diversification: Introducing new Intense Competition: The presence of
designs, variations, or complementary products competitors, especially those adopting
can attract a broader range of customers and aggressive pricing strategies, may impact
increase sales potential. market share and customer acquisition.
Collaborations: Partnerships with fashion Imitation and Counterfeits: The risk of
influencers, local retailers, or boutiques can imitation or counterfeit products in the market
help raise brand awareness and expand market can undermine the uniqueness and reputation
reach. of Ghulam's Khairi shoes.

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Quality Management at Ghulam's Khairi Shoes:

Quality management is a fundamental aspect of Ghulam's Khairi Shoes' operations, aiming to

ensure that each pair of handmade Khairi shoes meets and exceeds customer expectations. The
Khairi Center's commitment to maintaining the highest quality standards is evident in every step
of the production process, from material procurement to the final packaging. Here's an in-depth
look at Ghulam's Khairi Shoes' Quality Management practices:

 Raw Material Selection:

Quality starts with the selection of premium raw materials. Ghulam's Khairi Shoes sources
rexene, leather, white thread ("Shaleshan"), nails/spikes, and buckles from reliable suppliers in
Lahore. The company thoroughly inspects and tests the materials to ensure they meet the desired
specifications for durability, strength, and aesthetics.

 Skilled Artisans:

Craftsmanship is at the heart of Ghulam's Khairi Shoes, and the company places immense value
on the expertise of its artisans. The skilled artisans are well-trained in traditional techniques,
ensuring the meticulous assembly of the shoes with precise stitching and alignment. Continuous
training programs are also conducted to enhance their skills and keep them updated with modern
trends and customer preferences.

 Quality Control throughout the Production Process:

At every stage of production, Ghulam's Khairi Shoes implements stringent quality control
measures. Design and pattern creation involve meticulous planning to ensure that each type of
Khairi shoe (Gittay wala, Simple Khairi, Tilay wala, and Pishawari) is crafted to perfection.

During the cutting and preparation phase, the materials are carefully measured and cut according
to the designed patterns. Any deviations or imperfections are promptly addressed to maintain
consistency.

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The assembly process is subjected to multiple quality checks, ensuring that each stitch is secure
and aesthetically pleasing. Any embellishments or decorative elements added are scrutinized for
their accuracy and durability.

In the finishing stage, a comprehensive quality inspection is conducted to ensure that the shoes
meet the desired standards. Any excess material is trimmed, and the shoes are polished to present
a flawless appearance.

 Durability Testing:

Ghulam's Khairi Shoes understands the importance of durability for its customers. To ensure that
the shoes can withstand various conditions, extensive durability testing is conducted. This
involves subjecting the shoes to simulated wear and tear, including exposure to muddy areas,
rainy weather, and dry land. The shoes are evaluated for their resilience and performance over an
extended period, validating their durability claims.

 Customer Feedback and Satisfaction:

Customer feedback is invaluable for quality improvement. Ghulam's Khairi Shoes actively seeks
feedback from customers and uses it to enhance its products and services continually. The
company listens to customers' concerns, suggestions, and preferences, and incorporates this
feedback into the design and manufacturing processes. By putting the customer at the center of
their quality management approach, Ghulam's Khairi Shoes ensures that their products align with
customer needs and desires.

 Continuous Improvement Culture:

Continuous improvement is deeply ingrained in Ghulam's Khairi Shoes' culture. The company
regularly conducts internal audits and reviews to identify areas for improvement. They analyze
the production processes, supply chain, and inventory management to optimize efficiency and
reduce waste. By embracing innovation and staying adaptable to market trends, Ghulam's Khairi
Shoes can maintain its competitive edge and uphold the highest quality standards.

 Compliance with Cultural Significance:

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Ghulam's Khairi Shoes recognizes the cultural significance of their products and ensures that
each pair of shoes embodies the rich heritage and traditional values of the region. The company
is dedicated to preserving and promoting this cultural heritage through their footwear, and this
commitment is reflected in the quality and authenticity of their products.

In conclusion, Ghulam's Khairi Shoes' Quality Management practices revolve around

craftsmanship, customer satisfaction, and preserving cultural heritage. By meticulously selecting
materials, nurturing skilled artisans, conducting rigorous quality checks, and continuously
seeking improvement, the company ensures that their handmade Khairi shoes are of exceptional
quality and embody the essence of tradition and culture. This unwavering commitment to quality
has earned Ghulam's Khairi Shoes a loyal customer base and a reputation for excellence in the
market.

Capacity Planning

As we asked them about their capacity planning, they said we do not have such organized
planning they just take orders and make that required type of khairi for the customer.

They have the capacity of making 15 simple khairi per month and maximum 12 designed and
unique style khairi they can make in a month. Their storage is within the shop and they
continuously make khairi shoes (simple) and also the demanded one. The khairi which is
completed is displayed in the front wall inside the shop and also on the side walls.

They have limited recourses and have no machines so they take limited orders, if the orders
exceed the limits, they stop taking further order and they do not purchase more machinery for
that. They have the capacity of making maximum 15 khairi shoes from the available inventory
and then they purchase more inventories for further production.

Recommendations:

Ghulam's Khairi center should use some modern machines and focus on the marketing like by
creating catalogs online on social media apps and collab with the branded stores like Bata and
others to sell their products. They should also stop limiting their order picking strategies by

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completing all the order on time and with the help of machinery. The main thing is that they
should minimize working manually and should start using machinery instead of that. It should
also focus on the Ladies’ Khairi shoe as well because these shoes are also in trends especially in
summer. Ghulam’s Khairi Center should also focus on a proper warehouse for the proper
management of the raw material. In this way, it will cost very minimum instead of buying the
material after every three days from the Mianwali market. From the wholesale market, it will be
profitable to buy the raw material. To compete with the competitors, it should introduce the new
types of the khairi shoes as well as focus on the pricing and quality management strategies.

Exhibit 5:

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