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DISSERTATION REPORT ON
FUNCTIONS AND IMPORTANCE OF MERCHANDISING
IN APPAREL INDUSTRY
Prepared for:
Dr. Masud Al Noor
Head of the department (AMMT)
SMUCT
Prepared By:
Md.Belal Uddin
ID: 101011338
Group: D
Semester: 8th
March, 31, 2014.
Shanto-Mariam University of Creative Technology
March, 31, 2014.
Dr. Masud Al Noor
Head of the Department (AMMT)
Shanto-Mariam University of Creative Technology
Uttara, Dhaka.
Subject: DISSERTATION REPORT ON FUNCTIONS AND IMPORTANCE OF
MERCHANDISING IN APPAREL INDUSTRY.
Dear Sir,
I would like to inform you that, I am going to submit a dissertation report on functions and
importance of merchandising in apparel industry which is given by you. If you need any
clarification than please let me know.
I therefore, pray and hope that you would be kind enough to grant my prayer and oblige
thereby.
Sincerely,
…………………
Md.Belal Uddin
ID: 101011338
Group: D
Semester: 8th
TABLE OF CONTENTS
Topic Name Page Number
1. INTRODUCTION:……………………………………………………………… 01
1.1 Objectives…………………………………………………………………………….. 02
1.2 Methodology…………………………………………………………………………. 02
1.3 Scope………………………………………………………………………………….. 03
1.4 Limitation……………………………………………………………………………… 03 03
2. PROGRESS OF BANGLADESH RMG SECTOR:………………………….. 03
3. HISTORICAL PERSPECTIVE OF MERCHANDISING:………………….. 07
4. DETAILS DESCRIPTION ABOUT MERCHANDISING:…………………. 08
4.1. Definition of merchandising………………………………………………………… 08
4.2. Concept & Idea of Merchandising………………………………………………….. 09
4.3 The Modern Merchandising…………………………………………………………..………………………. 09
4.4 Type & Function of Merchandising…………………………………………………. 10
5. IMPLEMENTATION OF MERCHANDISING……………………………… 12
5.1. Importance of Merchandising……………………………………………………….. 12
5.2. Build up strong network with buying house, supplier of fabrics and accessories.…. 13
6. RESPONSIBILITY OF A MERCHANDISER………………………….. 13
6.1. Some Important work of a merchandiser…………………….……….…………… 14
6.2. Daily activities of a merchandiser............................................................................. 15
6.3. Weekly activities of merchandiser……………………………………….……….. 15
6.4. Monthly activities of a merchandiser …………………………………….………. 16
6.5. Yearly activities of a merchandiser ………………………………………………. 16
6.6. After confirming price a merchandiser works…………………………………….. 16
6.7. Some Important Issue for a merchandiser as well
as factory before starting work with a new buyer………………….……………… 17
6.8. The Confirming Order after Merchandiser Do Some Work……………………….. 18
6.9. Follow Up all Sections …………………………………………………………… 18
7. MERCHANDISING PROCESS FLOW……………………………………... 19
7.1. Garment Merchandising process flow…………………………………………….. 19
7.2. Negotiation (Price) Process and Ending of Negotiation…………………………... 20
7.3. Negotiation (Price) Process and Ending of Negotiation as following……………... 21
7.4. Process For Implementing Merchandise Plans…………………………………….. 21
7.5. Receipt of Order…………………………………………………………………… 23
7.6. Time & Action plan (T&A) Preparations………………………………………….. 23
7.7. According to T&A we will do our work according to below time schedule……….. 24
7.8. Fabric Ordering…………………………………………………………………….. 28
7.9. Payment Term……………………………………………………………………… 28
7.10. Pilot Yardage…………………………………………………………………….. 29
7.11. Inspection………………………………………………………………………… 29
7.12. Trims ordering……………………………………………………………………. 30
7.13. Production Sampling……………………………………………………………… 33
7.14. Merchandising Season…………………………………………………………….. 34
7.15. Types of Merchandising Season………………………………………………….. 34
7.16. Inspection Schedule of Different Buyer…………………………………………... 35
8. SOME IMPORTANT SOURCING AND PRODUCTION DEVELOP
CONTROLLING PROCEDURE…………………………………………….. 38
8.1. Sourcing……………………………………………………….. 38
8.2. Sales & Marketing Interface…………………………………………………… 39
8.3. Product Development………………………………………………………….. 39
8.4. Production Authorization……………………………………………………… 40
8.5. Product Information System…………………………………………………… 41
8.6. Efficiency calculation…………………………………………………………. 41
8.7. Basic knowledge of Work Study…………………………………………… 42
8.8. Fist Used For Daily Production……………………………………………… 43
8.9. Work study is the most accurate method of setting Standard of performance
upon which effective planning and production control relies upon…………………… 44
9. IMPORTANT MARKETING STRATEGY FOR A MERCHANDISER… 45
9.1. Marketing strategy………………………………………………………………. 45
9.2. Target Market……………………………………………………………………. 45
9.3. Market Segmentation…………………………………………………………… 47
9.4. Alternate Marketing……………………………………………………………… 47
9.5. Market Research…………………………………………………………………. 48
10. WORK OF APPAREL MERCHANDISER…………………………………. 48
10.1. Business Development Procedure of merchandiser………………………………. 48
10.2. First E-mail to the Buyer for Business Development……………………………… 49
10.3. Feed -Back From Buyer in Response to First Email…………………………… 50
10.4. Basic qualifications should have the Merchandisers…………………………… 50
10.5. Main function of a Merchandiser to execute an order perfectly on time (schedule) 50
10.6. Factors of industrial buyer……………………………………………………… 50
10.7. Daily correspondences with buyer……………………………………………… 51
10.8. Email to buyer in response to buyers complains………………………………… 51
10.9. Sending Quality Sample to the New Buyer for Better Understanding………... 52
10.10. Sampling Procedure…………………………………………………………… 52
10.11. Approval produces of sales samples…………………………………………… 53
10.12. Sub-Contract Agreement……………………………………………………… 54
10.13. Merchandising Procedure to Execute an Order……………………………….. 55
10.14. Buyer Approval Procedure of Fabrics, Color &Accessories by Supplier……... 57
10.15. Master LC Checking Procedure……………………………………………….. 57
10.16. ML/C Confirmation Procedure………………………………………………… 58
10.17. Different Types of Samples……………………………………………………. 58
10.18. Emails to Supplier for Samples of Yarn, Fabrics and Different Types of
Accessories for Buyer Approval………………………………………………. 59
10.19. Preparation of Data Bank Suppliers for Different Items………………………. 59
10.20. Merchandiser Should Be Known Different Yarn Count………………………. 59
10.21. Merchandiser Should Be Known Different Thread Consumption…………….. 63
10.22. Machine Wise Sewing Thread Consumption/Inch............................................... 65
10.23. Specimen Sewing Thread Consumption............................................................... 65
10.24. Merchandiser Should Be Known Some Important Abbreviation
For Merchandising Dept…………………………………………………………. 66
10.25. CBM Calculation………………………………………………………………… 66
10.26. Price Quotations…………………………………………………………………. 66
10.27. Costing of garments product……………………………………………………. 67
10.28. Costing of Garments (in FOB) Price…………………………………………….. 68
10.29. Cost sheet preparation…………………………………………………………… 69
10.30. Cost Sheet Analysis……………………………………………………………… 69
10.31. Consumption of Shirt, T-shirt, Trouser…………………………………………… 70
10.32. Interning Consumption…………………………………………………………… 75
10.33. Twill Tape Consumption………………………………………………………… 75
10.34. Button Consumption…………………………………………………………….. 75
10.35. Consumption sheet preparation………………………………………………….. 76
10.36. Poly Consumption……………………………………………………………….. 77
10.37. Poly Costing……………………………………………………………………... 77
10.38. Inventory of accessories…………………………………………………………. 78
10.39. Preparation of Packing List after Final Inspection…………………………….. 79
10.40. Shipping Mark…………………………………………………………………. 81
10.41. Some Important Printing & Embroidery……………………………………….. 81
10.42. Embroidery Section …………………………………………………………… 82
10.43. PI Sheet and its Items…………………………………………………………… 82
10.44. Agenda and Minutes Writing Procedure………………………………………… 83
10.45. Steps of Negotiation between Merchandiser & Supplier………………………… 83
10.46. Negotiation Process……………………………………………………………… 83
10.47. Price Negotiation Procedure with Different Suppliers…………………………... 84
10.48. Items Included in P.O…………………………………………………………… 84
10.49. Those items are included in P.O. This are………………………………………. 86
10.50. P/I Collection Procedure from Supplies and Checking of P.I…………………… 86
10.51. PI Sheet and Its Items…………………………………………………………… 86
10.52. PI Request to Yarn Supplier…………………………………………………….. 87
10.53. Daily Production Report from the Supplier & Monitoring…………………….... 89
10.54. Preparation of Shipping Sample and Sending To Buyer………………………… 89
10.55. Investigation to Third Party like SGS, ITS for Final Inspection………………… 89
10.56. Trim Card Preparation…………………………………………………………… 89
10.57. Price Negotiation Meeting………………………………………………………... 89
10.58. Procedure of Receiving for Accessories…………………………………………. 90
10.59. Buyer Wise Purchase Order……………………………………………………… 91
10.60. Production flow of Sales & distribution………………………………………… 93
10.61. Future Business Plan Writing…………………………………………………… 94
11. MERCHANDISER SHOULD BE KNOWN DIFFERENT L/C……….…… 95
11.1. Application Procedure to Bank for Back to Back L/C Opening…………………. 95
11.2. Checking Master L/C Related with Terms and Condition Maintained In Master L/C 96
11.3. Collection of All Relevant Documents From Different Companies And
Organizations Like GSP, CO, etc……………………….…………………… 96
11.4. Preparation of Commercial Invoice……………………………………………… 96
11.5. Master L/C………………………………………………………………………. 97
11.6. Forwarding Agents………………………………………………………………. 97
11.7. Documentation Submission Procedure to the Bank……………………………… 97
11.8. Application Procedure for Cash Intensive from Bank…………………………… 97
11.9. Different Types of Containers……………………………………………………. 98
11.10. Containers size………………………………………………………………….. 99
12. INTRNATIONAL COMMERCIAL TERMS THAT ARE NEEDED A
MERCHANDISER…………………………………………………………….. 99
12.1. EXW - Ex Works (named place)………………………………………………… 99
12.2. FCA - Free Carrier (named place)……………………………………………….. 99
12.3. FAS - Free Alongside Ship (named port of shipment)………………………… 100
12.4. FOB - Freight on Board (named port of shipment)……………………..……. 100
12.5. CNF - Cost & Freight (named port of destination)……………………..……. 100
12.6. CIF-Cost, Insurance & Freight (named port of destination)……………..…... 100
12.7. CPT - Carriage Paid To (named port of destination)………………..
101
12.8. CIP - Carriage & Insurance Paid To (named port of destination)………..….. 101
12.9. DAF - Delivered at Frontier (named place)……………………………………… 101
12.10. DES - Delivered EX Ship (named port of destination)………………………… 102
12.11. DEQ - Delivered EX Quay (named port of destination)……………………….. 102
12.12. DDU - Delivered Duty Unpaid (named place of destination)………………….. 102
12.13. DDP - Delivered Duty Paid (named place of destination)…………………….... 102
13. ORDER MANAGEMENT IN GARMENTS INDUSTRY…………………. 103
13.1. Follow Up‟s & Updates………………………………………………………...... 103
13.2. Approvals……………………………………………………………………….. 105
13.3. Inter Department Co-ordination………………………………………………… 105
14. SOME DOCUMENTATION OF MERCHANDISING………………….
106
14.1. Sourcing Documents……………………………………………………………. 106
14.2. Letter of Credit………………………………………………………………….. 107
14.3. Documentation for Opening L/C………………………………………………… 112
14.4. Bill of Lading…………………………………………………………………… 112
14.5. Insurance Documents……………………………………………………………. 113
14.6. Invoice…………………………………………………………………………… 113
14.7. Certificate of Origin……………………………………………………………… 116
14.8. Order Confirmation Documents………………………………………………….. 117
14.9. Import Documents……………………………………………………………….. 117
14.10. Documentation on Receipt of the Material at the Factory………………………. 117
14.11. Documentation during Production……………………………………………… 117
14.12. Export Documentation………………………………………………………….. 117
14.13. Packing List/ Weight Note……………………………………………………… 118
14.14. Air Way Bill……………………………………………………………………. 118
15. ORDER ACHIVEMENT ANALYSES…………………………………………. 119
15.1. Material Utilization Report……………………………………………………… 119
15.2. Style and factory capability report……………………………………………….. 119
15.3. Product quality report……………………………………………………………. 119
16. CONCLUSION………………………………………………………………… 120
17. RECOMANDATIONS…………………………………………………………. 120
18. BIBLIOGRAPHY………………………………………………………………. 120
19. APPENDIX…………………………………………………………………………… 121
1
1. INTRODUCTION.
The tremendous success of readymade garment exports from Bangladesh over the
last two decades has surpassed the most optimistic expectations. Today the apparel export
sector is a multi-billion-dollar manufacturing and export industry in the country.
The overall impact of the readymade garment exports is certainly one of the most significant
social and economic developments in contemporary Bangladesh. With over one
and a h a l f mi l l i o n w o men wo rk e r s emp lo yed in s emi - s k i l l ed an d s k i l l ed
j ob s p r od u c in g clothing for exports, the development of the apparel export industry has
had far-reaching implications for the society and economy of Bangladesh
For Bangladesh, the readymade garment export industry has been the proverbial goose that lays the
golden eggs for over fifteen years now. The sector now dominates the modern
economy in export earnings, secondary impact and employment generated. The events in1998
serve to highlight the vulnerability of this industry to both internal and external shocks
on the demand and supply side. Given the dominance of the sector in the overall modern
economy of Bangladesh, this vulnerability should be a matter of some concern tithe policymakers in
Bangladesh. Although in gross terms the sector‟s contributions to the country‟s export earnings is
around 74 percent, in net terms the share would be much less p a r t i a l l y b ecau s e t h e
b ack war d l i nk a ges i n t ex t i l e h av e bee n s l ow to d ev e l op . T h e dependence on
a single sector, no matter how resilient or sturdy that sector is, is a matter of policy concern. We
believe the policymakers in Bangladesh should work to reduce this dependence by
moving quickly to develop the other export industries using the lessons learned from the
success of apparel exports. The industry is one hundred percent export-oriented and therefore
insulated from domestic demand shocks; however, it remains vulnerable to domestic supply
shocks and the smooth functioning of the banking, transportation another forward and
backward linkage sectors of the economy. The Dhaka-Chittagong road remains the main
transportation link connecting the production units, mostly situated in and around Dhaka and the port
in Chittagong, where the raw material and the finished products are shipped in and out. Despite
increased dependence on air transportation, trucks remain the main vehicles for
transporting raw materials and finished products for Bangladesh garment exports.
The RMG sector in Bangladesh, with its low productivity and poor quality will be no match
for the competitive producers. The higher volume is explained by productivity. Factories in
Sri Lanka operate at 80% - 90% of potential capacity whereas in Bangladesh, according to
some experts, productivity is between 35% and 55% of potential capacity with very few
exceptions. For the RMG sector in Bangladesh, productivity alone can make a difference
between life and death. The higher dollar value is explained by the addition of value. The
consumer surplus is drastically greater in the market for high end products. Consequently, the
profit margin is much higher for high end products.
2
or a overall success in the garments.
The role of Merchandising in export sector in Bangladesh.
Finding the problem what actually faced the merchandiser at work.
Collecting information about merchandising job & their responsibilities.
To identify the supply chain management direction with in the merchandising
management system.
To develop relation between quality & merchandising.
Find out the role of merchandising in RMG sector.
Describe the dimensions of Apparel product lines, including the merchandising calendar.
Discuss the relationship of merchandising to sourcing finished goods, materials, and
production.
1.1 Methodology:
A t f i r s t , w e w en t t o d i f f e r en t ga r m en t s co mp an y an d co l l e c t
i n fo rm at io n f ro m th e personnel. In preparing this report, we approached according to
the following procedure:
Primary Sources
For the completion of this report, the primary sources of data are-
STAELET APPARELS LTD.
Experts‟ opinion and comments, Observations of the officials,
Face to face conversations with the employees of Garments.
Secondary Sources
Relevant books, Newspaper, journals etc.
Websites.
Office circular and other published papers.
Manual of different departments.
Data Gathering: Data gathering will be taken place after preparing the structure for in-depth
interview that will need for supportive information. Interview will be taken with two or three
highly ranked respective officials of all division and Loan department.
Data Processing: After conducting the research it will be justify the findings and will be
written in the form of a report.
Data Analysis: Analysis will be performed from the collected data and findings and
recommendation will make from the results. Select the topic
1. Conduct survey
2. Sorting information
3. Analysis and evaluation of the information
4. Report writing and presenting
3
1.3 Scope:
Besides STARLET APPARELS LTD. it may be required to go other garment industry and
buying houses. I will talk with in-house department, like finance department, commercial
department, marketing department and all the group of industries to get right information for
my report.
This report must deals with factory observation of a garments industry and communication
with merchandisers then I will work in a factory suggest.
1.4 Limitations:
I think these are the limitation of the industry. The main limitations of the study are as
follows:
The merchandisers of the company are always busy, so they could not provide the
information timely.
Sufficient records, facts and figures are not available. These constraints narrowed the
scope of the real analysis.
There is no special training department for study.
2. PROGRESS OF BANGLADESH RMG SECTOR.
The RMG business started in Bangladesh in the 70s but it was then merely a casual effort.
The first consignment of knitwear export was made in 1973 and the first consignment of
woven garments was made in 1977. Though started later, but it was the woven sector that
first dint a spot in the export pie of Bangladesh. In 1981-82 the contribution of woven
garments in the total export was 1.10%. Afterwards it is a story of sustained success for the
Bangladesh RMG sector. Within a decade the contribution of woven to the export basket
became 42.83% (1990-91) and the knitwear sector's contribution was 7.64% (1990-91).
4
The entrepreneurs of the knit sector stepped forward with their expertise in the late 80's. With
their earnest efforts they were able to export US$ 14.84 million in 1989-90. Out of this US$
12.22 million was exported to EU and US$ 2.02 million was exported to US. The trend
continued in the knit sector because of the market access opportunity provided to the LDCs
under the Generalized Systems of Preference (GSP) benefit.
This is the rejuvenated beginning of the epic story of Bangladeshi knitwear sector RMG
sector that in true sense has been able to massive industrialization in a sustainable way with
effect on all probable human development aspects which is the encouraging part of the story.
The growth of knitwear sector is increasing at an increasing rate. The cumulative average
growth rate of the sector is 27%. And it is continuously grabbing a more portion in the export
pie of Bangladesh. This is mainly attributed to the facilities provided under the EC GSP and
ROO. The knitwear sector is heavily driven by these favorable policies and took the
opportunity to develop a strong backward linkage for the sector.
Year Knitwear Woven Wear Total Export
Volume (%)
change
Share(%)
in BD
Export
Volume (%)
change
Share(%)
in BD
Export
RMG Bangladesh
89-90 14.84 0 0.77 609.32 29.34 31.67 624.16 1923.70
90-91 131.20 784.00 7.64 735.62 20.73 42.83 866.82 1717.55
91-92 118.57 -9.62 5.95 1064.00 44.64 53.36 1182.57 1993.90
5
Comparative Statistics of Knit Wear & Woven Wear (Volume in Million US$)
EU is the main export region of Bangladeshi Knitwear constituting 79% (US$ 2227.27
million) of total knitwear export in FY 2003-2004 followed by USA (14.27%, i.e. US$
402.38 million). This has become possible because it can satisfy the ROO of EU as value
addition is higher (75%) in this sector. After the adoption of the guidelines for the application
of the scheme of generalized tariff preferences by EC knitwear export from Bangladesh to
EU rose precipitously. The two-stage transformation requirement of ROO in 1999 boosted
market penetration in EU further; it contributed a growth of 101.19% since 2000-2001.
92-93 204.55 72.51 8.58 1240.48 16.59 52.06 1445.03 2382.89
93-94 264.14 29.13 10.42 1291.64 4.12 50.97 1555.78 2533.90
94-95 393.26 48.88 11.32 1835.09 42.07 52.85 2228.35 3472.56
95-96 598.32 52.14 15.41 1948.81 6.20 50.20 2547.13 3882.42
96-97 763.30 27.57 17.28 2237.95 14.84 50.65 3001.25 4418.28
97-98 940.31 23.19 18.22 2843.33 27.05 55.09 3783.64 5161.20
98-99 1035.36 10.11 19.49 2984.81 4.98 56.18 4020.17 5312.86
99-00 1269.83 22.64 22.08 3082.56 3.27 53.59 4352.39 5752.20
00-01 1496.23 17.83 23.14 3364.20 9.14 52.02 4860.43 6467.30
01-02 1459.24 -2.48 24.38 3124.56 -7.12 52.20 4583.80 5986.09
02-03 1653.83 13.34 25.26 3258.27 4.28 49.76 4912.10 6548.44
03-04 2148.02 29.88 28.25 3538.07 8.59 46.54 5686.09 7602.99
04-05 2819.47 31.26 32.58 3598.20 1.70 41.58 6417.67 8654.52
05-06 3816.98 35.38 36.26 4083.82 13.50 38.78 7900.80 10526.16
06-07 4553.60 19.30 37.39 4657.63 14.05 38.25 9211.23 12177.86
6
Knitwear Export to Major Markets
Bangladesh RMG sector has successfully passed some critical tests and is now sailing with
two masts: knit and woven. The sub-sectors are now in healthy competition among
themselves to take the role of leadership within the country.
Comparison of Export Quantity
In FY 2003-04, knitwear for the first time exceeded woven wear and became the leader in
terms of quantity exported with 91.6 million dozens. The amount of woven export was 90.49
million dozens. Knitwear is still leading in terms of quantity exported and is widening the gap
day by day. The present difference in favor of knitwear is 56.21 million dozens. In FY 2003-
04, the contribution of two RMG sub-sectors in national export were as follows: Woven
Garments 46.54% and Knitwear 28.25%. In FY 2004-05 the figures have changed
dramatically, the share of woven garment to the country's export has reduced to 41.58%, on
7
the other hand the share of knitwear has increased to 32.58%. It indicates clearly that the
knitwear is performing well in both ways. In FY 2005-06 the scenario is as under:
Knitwear export increased by US$ 997.51 Million (35.38%)
National export increased by US$ 1871.64 Million (21.63%)
3. HISTORICAL PERSPECTIVE OF MERCHANDISING.
After World War II the sales representatives took orders and the manufacturing division of
accompany stock position. The profitability of the company was dependent primarily on
efficient manufacturing. Under this structure manufacturing executives wielded tremendous
power within the organization and within the industry. In the 1960s, brand recognition
became very important. The concept of marketing was embraced by the apparel industry to
evaluate consumer needs and strengthen the image of growing apparel companies through
advertising and promotion. The marketing function was added to company structure. The
rapid growth of many apparel companies also created a new focus on finance and cost
containment, introducing the function of finance and administration. In the late 1960s the
companies that embraced modern marketing concepts prospered, and the marketing
executives took on increased responsibilities and authority within the organization.
Understanding the need to fulfill consumer demands, product development department were
established with creative design capabilities. Early merchandisers focused on overseeing the
design function to ensure that market data where interpreted into desirable product lines in a
timely manner. In the 1970s and 1980s those companies that were able to successfully
interpret the rapidly changing whims of the fashion-buying public into fresh new styles
prospered. This prosperity depended on the talents of the new breed of professional apparel
merchandisers.
After 1980 the garments sector of Bangladesh began to grow as an industry. Lot of
nonprofessional & non-skilled people were started the dealings. Day by day the sector grew
up and it became the main earning source of our country. Foreign experts were hired to
increase the productivity and make the local people skilled. Now more than 77% of the total
export is done from garments sector.
From the beginning Merchandising was the most important part of RMG sector.
Merchandisers were the key people to deal with the buyers and take the orders as well as
make the shipment with expected quality. It is an expert Merchandiser who can bring profit to
his company. But history says that if the Merchandisers behaved more professional the loss
of RMG sector could be minimized
8
4. DETAILS DESCRIPTION ABOUT MERCHANDISING.
Merchandising:
Merchandising is a business on marketing activities responsible for ensuring a products
description both quality and quantity. Merchandising means total responsibility of a
Merchandiser.
The key factors behind this are low technological development, lower output, cut throat
competition, high raw material cost, inadequate infrastructure, traditional productivity,
unfavorable regularity policies, and globalization in fact. However, there a fair list of the
producers, suppliers, and exporters that are fully acknowledge with regularity policies and
formalities, international marketing policies and procedures. The only concern is in executing
their productivity initiatives, and meeting with order deadlines.
Now days, major companies are adopting merchandising concepts, which comply with all
procedures to execute and dispatch the shipment on time considering quality, cost and time.
Merchandisers are serious in the success of any garment business. They provide the right
products at the right time, enabling a company to match with latest market trends and meet
the market demand. In the merchandising concept, time management is a gig to manage ones
time properly, so he can focus on value adding actions.
Garments merchandising means the work to buy raw material and accessories to produce
garments (Merchandise) against a particular work order of garment and have to export these
under the same work order within time schedule, maintaining required quality level of buyer.
4.1. Definition of merchandising.
Merchandising - Merchandising involved with trade (buy & sale).
Apparel Merchandising – Apparel merchandising involved in garments trade (Goods are
bought and apparel sold).
Merchandiser – Merchandising may be defined as: - Person who merchandises the goods,
specifically for export purposes. Term Apparel Merchandising means:-
Order confirmation by negotiation
Buying raw materials and accessories
Producing garments
Maintaining required quality level
Exporting the garments with in schedule time
From the above definitions, we can say that a person who involved in apparel merchandising
needs a wide range of knowledge and skills to perform his/ her job successfully. The job
itself is Technical and general as well.
9
4.2 . Concept & Idea of Merchandising.
Concept:-
"Merchandising" is known to the persons specially involved in garments trade. The term
merchandising has been derived from the merchandise. Merchandise means goods that are
bought & sold.
The term "Merchandising" may be defined as Person who merchandises the goods,
specifically for export purposes. Garments merchandising means buying raw materials &
accessories, producing garments, maintaining required quality level and exporting the
garments within schedule time. From the above definitions, we can say that a person involved
in garments merchandising needs a wide range of knowledge & skill to perform his job
successfully. The job itself is Technical and general as well.
Idea about merchandising:-
Merchandising is planning developed and presenting product line for identified target market
with regard to pricing assorting styling and services must be planned developed and
presented. Merchandising is most distinct as a business function among firms that deal with
products that have demand for frequent change. Consequently the foundation of
merchandising principles is rooted in the apparel business. The textile and apparel business is
fascination to study and compared to other industries, has many unique characteristics.
4.3. The Modern Merchandising:
In retail commerce, merchandising means maximizing merchandise sales using product
design, selection, packaging, pricing, and display that stimulates consumer to spend more.
This includes disciplines in pricing and discounting, physical presentation of products and
displays, and the decisions about which products should be presented to which customers at
what time.
The role of merchandising was redefined in the late 1970s. Apparel companies could no
longer focus solely on efficient manufacturing to be successful. Target market analysis,
Product development, sourcing manufacturing throughout the world and inventory
management had to be under effective & positive control. Merchandiser must be able to
rigorously plan and control the functions involved in developing product, sourcing it and
getting it to the customers in time, as well as have a keen understanding and appreciation for
creative design. It is this balance of solid analytical thinking and abstract creative expression
that makes the ideal merchandisers such a unique individual.
10
The merchandising executive must combine logical thinking with intuitive and expressive
creativity.
Merchandiser may be defined as, Person who merchandises the goods, specifically for
export purposes.
In terms of Apparel Merchandising, order confirmation by negotiation, buying raw
materials and accessories, producing garments, maintaining required quality level,
exporting the garments with in schedule time are the main duties of a merchandiser.
4.4. Type & Function of Merchandising:-
Merchandising
Merchandising is the department which mediates marketing and production departments. It is
the methods, practices, and operations used to promote and sustain certain categories of
commercial activity. It includes directing and overseeing the development of product line
from start to finish. Marketing and merchandising department: A team of merchandisers and
marketers work together under a profit controls head. Merchandisers handle the foreign
buyers. The teams are made according to the buyers being handled.
Merchandiser The person who is related in merchandising is called merchandiser. The merchandiser
coordinates with the design team to effectively present the product or product line. He or she
develops colors and specifications, and performs market research to determine the most
effective ways to sell and promote the product. This person needs strong communication and
negotiation skills and visual and analytical abilities. He or she also needs to be a creative and
innovative thinker.
If anybody has to be designated as Merchandiser then the word itself demands some qualities
from that individual, now let us see what all are the hidden meanings there in the word
¨MERCHANDISER¨
M- Should have good Managerial capacity.
E- Efficient in both English written and spoken.
R- Having high sense of Responsibility.
C- Always keep commitment.
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H- Leads Honest life.
A- Attitude should always be positive in resolving any problem.
N- Never does any argue with buyers and seniors.
D- Fully Devoted to his service.
I- Always well Informed about his all orders.
S- Sincere in office and daily works.
E- Enthusiastic in nature.
R- Regular in e-mail correspondence
Types of Merchandising:
Two type of merchandising done in garment exports
1. Marketing merchandising.
2. Product merchandising.
Main function of marketing merchandising is
1. Product Development
2. Costing
Ordering Marketing merchandising is to bring orders costly products development
and it has direct contact with the buyer.
Product Merchandising: Product merchandising is done in the unit. This includes all the responsibilities from
sourcing to finishing i.e. first sample onwards, the products merchandising work start
and ends till shipment.
Function of Merchandisers:
1. Developing new samples, execute sample orders
2. Costing
3. Programming
4. Raw materials / Accessories arrangement
5. Production scheduling (or) route card drafting
6. Approval of various Process, Pattern and size set
7. Pre-production follow up
8. Meet Inspection Agencies
9. Production controlling
10. Identifying shortages and make arrangement for the shortages
11. Following quality assurance procedures, quality control procedures
12. Monitoring the in-house, sub-contractors and junior activities
13. Buyer communication
14. Communication with sub-contractors, processing units & other 3rd parties
15. Proper reporting
16. Highlighting to the management
17. Record maintenance
18. Developing samples
19. Placement of orders to suppliers
20. Taking measures for consistent production.
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5. IMPLEMENTATION OF MERCHANDISING.
RMG sector has great effect on our, country lot of people are fond of an opportunity to
improve their life style by involving in garment sector. Merchandising is the key section for
the garment industry, garments sector basically depends on buyer order. If the factory able to
meet the buyer requirement and delivery the quality goods on time then the factory will be
profitable & can be extend their business & exist in the competitive market.
Objectives Implementation of Merchandising:
1. Help develop and implement effective merchandising plans by working with retailers,
manufacturers and licensing companies
2. Review and help manage merchandising operations
3. Develop and implement merchandising plans that are as individual as each of our
clients by custom-designing merchandising processes based on each of the client's
one-of-a-kind business strategies
Methodology Implementation of Merchandising:
1. Review existing merchandise planning methodology and practices
2. Provide new tools and training to implement best practices (Open-to-Buy Excel
Spreadsheets)
3. Suggest new methods and software for planning
4. Assist in install, testing and use of new software and/or new procedures
In the garments manufacturing sector merchandiser‟s has different steps of work to
accomplish. Merchandiser has to follow-up the full order including taking the whole
responsibility. Merchandiser has to undertake & have knowledge about each & every section
of garment. But most of the time garment merchandisers face plenty of problems like non-
coordination, miss-communication, understanding buyer requirements, missing chain of
commands, miss collaboration supply chain management etc. virtually this research based on
Proper Merchandising & Quality management system in RMG sector. This report is divided
in to two parts. Part „A‟ is defining the proper merchandising management system and part
„B‟ is defining the proper quality management system.
5.1. Importance of Merchandising:-
We can easily understand the importance of merchandising in our garments industry.
Merchandising is playing a vital role to make new business development process. We will
easily understand the importance of merchandising by following words-
Merchandising helps for business development.
Ensure the products in time delivery.
Create a market in garments industry.
To ensure money in the bank.
Helps for 76% total export of Bangladesh.
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Organize supply chain, monitoring and controlling.
In considering the importance of visual merchandising on retail businesses the single and
most important reason is to engage and inspire shoppers, to encourage them to buy more
of the products you want them to, increasing your sales, margin and return on space – after
all, you are running a business! That engagement process of course starts even before they
have set foot in your store.
5.2. Build up strong network with buying house, supplier of fabrics and accessories:-
Without bringing up someone close you may not benefited. For this reason a merchandiser
should have a strong network with all buying houses and suppliers so that he can run his
work properly.
Doing all the works a merchandiser can go for the next stage. His second step starts with
getting new order. When a merchandiser gets new order he has to do the below works.
1. Receive product package from buyer: His second stage‟s work begins with receiving
product package from his customer.
2. Discuss with planning and product department for production space and ability to do the work: After observing the product package a merchandiser should have a sound
talk or discussion with the planning and production department about the package to
settle whether they are able to make the product or not.
3. Analyze product package: On the basis of a product package an order will be going on.
So analyzing product package is one of the important duties of a merchandiser.
4. List out type of fabric and accessories: If a merchandiser analyzes a product package he
can list out what type of fabrics and accessories needed for the package.
5. Do consumption of fabrics and accessories: List out fabrics and accessories he will go
for the consumption done.
6. Do the costing and quote price: After doing consumption a merchandiser will be clear
about the costing and he will quote the price accordingly.
7. Negotiate and confirm price: This is the last of a merchandiser performing the
responsibilities of second stage. He should negotiate about the price and confirm it.
6. RESPONSIBILITY OF A MERCHANDISER.
In order to fully appreciate the blend of characteristics and traits that are needed for an
effective merchandiser, it is important to understand the responsibilities the job entails.
Depending upon the size and structure of a company, the merchandiser may be responsible
for some or all of the functions shown in the figure 4.1.
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6.1. Some Important work of a merchandiser :
Most importance things for a Merchandiser are:
Communication.
Planning
Production Follow Up
The responsibility of a smart Merchandiser in handling order at four stages:
1. Sourcing for future orders/Buyers
2. New Order
3. Confirmed Order
4. Running Order
Order → Process → Execute
Some qualities of a Merchandiser:-
1. Language skill.
2. Computer skill.
3. Marketing skill.
4. Right consumption knowledge of various goods.
5. Costing knowledge of raw materials.
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6. Order getting ability (That is if the merchandiser is known by actual rate of raw
materials, so that he can negotiate perfectly with buyer. In this way, the possibility of
getting order is hundred percent.)
7. Sincere& responsible.
8. Hard worker.
Activities of Merchandiser
Merchandiser need to work in a systematic way to ensure proper delivery of products at due
date. They had to do their work into daily, weekly, monthly and yearly basis. The activities
are-
6.2. Daily activities of a merchandiser:
Checking mails and faxes. They need to give the reply within the day based on
priority.
Checking port status and convey to concern department.
Checking the shipments documents and inform concern department.
Checking daily production status to understand shipment status
Checking shipment schedule and raw materials production status
Follow-up with sample section for different buyers sample
Follow-up with store for fabric and accessories received
Follow-up with the production manager for the production plan
Follow-up with the commercial people L/C,BTB L/C and L/C amendment
Price quotation and delivery confirmation to the buyer
Reporting to marketing and merchandising chief on the daily activities.
Reporting to executive director on the important issue like various meeting,
customer visits compliances and code of conduct
6.3. Weekly activities of merchandiser
Meeting with the fabrics and accessories supplier
Meeting with the buyer and buying houses
Prepare fabric and accessories requirement list, checking with concern and
passing it to supplier with proper specification.
Prepare purchase order with approval and sign of proper authority.
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Issuing pro-forma invoice with the approval and sign of the proper authority.
Providing cost break-down to commercial department during L/C opening
6.4. Monthly activities of a merchandiser
Meeting with the production people
Meeting with the quality people and pattern master
6.5. Yearly activities of a merchandiser
Yearly self-assessment on the performance based on number of buyers handled,
shipment quantity, CM charge negotiated, debit note settled with the supplier.
6.6. After confirming price a merchandiser works:
Sourcing for future orders/Buyers: Doing this work he is to do the following
works-
Collect Data of all Buying House: His/her first and for most duty that he is to be
well acquainted with all the buying houses how and abroad.
Select potential Buyers: Collecting data of all buying houses he should select who
are the potential Buyers.
Visit Local Buying House and Give Profile: After selecting potential Buyers he
should have to visit Local Buying House and give profile so that the Local Buying
Houses may know about them.
Write mails to all Buyers: When a Merchandiser collects data of all Buying House
he will be got the contact address. So, writing e-mail to all Buyers is one of the major
duties to be performed.
Attend National & International Seminars: The world has been a global village in
the arena of Marketing. So for marketing anything else everyone should attend
national & international seminars.
Organize a display: In the business world those who can express/show/display
themselves are getting more business. So, organizing a display of his company is a pre
duty of a Merchandiser. For this a Merchandiser may open a well site with well
equipped.
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6.7. Some Important Issue for a merchandiser as well as factory before starting work
with a new buyer:
The buyer name & history.
Final destination or place of delivers the goods.
Buying house name (if any).
Payment terms (L/C or TT or Contact).
If L/C then, the Payment Condition at sight or deferred.
If deferred then, 60 days or 90 days or any other.
Price will be in FOB or CIF?
Is the price will be including buying commission or w/o commission?
Who will inspect the goods?
If third party then who will be pay the inspection charge?
Original art work with styling details or Scan copy must be needed.
Actual & latest size specs with all the sizes which qty in purchase order / order
sheet.
Fabrications details (Composition, Type, Gsm, Peach/sweated,
Enzyme/silicon or any other additional requirement).
Additional fabric details (Appliqué etc, if any).
Wash garments or w/o wash (if then washing details).
Print details including dimension & placement. Such as pigment/rubber/flock/foil
etc (if any).
Embroidery details (Normal stitch, appliqué, Badge etc, if any).
Test requirement details (Azo or any others, if any).
Order qty, if possible color wise (Approximately).
Maximum body color (Approximately).
Size wise qty ratio (%) = S/? %, M/? %, L/ ? % etc.
Stripe repetition details with color (for yarn dyed).
Viscose percentage for Grey mélange & Polyester percentage for cvc or pc
Probable delivery date.
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6.8. The Confirming Order after Merchandiser Do Some Work:-
Confirming price is meant to confirm the order. And this is the third stage on which a
merchandiser works. Firstly he is to do the followings:
Time and action planning: Before starting the bulk production preparing time and
action calendar is the most important work. How they set up their line. for
maximum production and which method they will use for maintaining the lead
time.
Prepare Gantt chart: Gantt chart is the consequence of time and action planning.
To maintain the time and action planning preparing the Gantt chart is very
necessary for a merchandiser.
Receiving color standard: Matching color standard in accordance with the buyers
requirement. And for this reasons receiving color standard is an important task.
Submission of lab dip: For fixing color standard lab dip plays a vital role in this
case. So for lab dip test submission is much necessary.
Development of printing and embroidery: If there is requirement of printing and
embroidery the development of printing and embroidery should be going on along
with the bulk production.
Booking of yarn fabrics, yarn and accessories: Before going to the bulk
production booking of yarn fabrics, and accessories are a pre- requisite for a
merchandiser to be performed.
Receiving of master LC: Arranging all things above by this time master LC will
be reached to the bank and receiving the master LC from the commercial manager
is one of the responsibilities of a merchandiser.
Opening of Back to Back LC: Being received master LC opening back to back
LC is more necessary. Otherwise, bulk production may be hampered for not storing
the goods on by the suppliers.
6.9. Follow Up all Sections :
Last of all a merchandiser should go for the next stage that is running order. It is only
following up all the sections. For the continuation of running order he is to firstly follow:
1. Follow T & A calendar: which is prepared in the third stage for smoothly running the
bulk production.
2. Follow Gantt chart: His second responsibilities in this stage are to follow up Gantt
chart.
3. Follow up the fabrics, dye lot, shade for woven and blanket for denim. Then he will
4. For knit composite factory he is to follow up yarn sourcing, yarn dyeing, knitting
program, dyeing program.
5. He is to follow up printing, embroidery and washing.
6. Follow up cutting, sewing and finishing.
7. Arrange all samples: After getting production he is to arrange all samples.
8. Arrange all lab tests.
9. Arrange all inspections.
10. Ensure shipment of garments on time.
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7. MERCHANDISING PROCESS FLOW.
7.1. Garment Merchandising process flow.
Process Flow of Merchandising:
Merchandiser
Negotiation with buyer
Export order collect
Costing of accessories
Send to the buyer
If ok then sample making (according to buyer requirement)
Get approval
Go to production
In-house of accessories
Line balancing
Production continuing (follow up)
Inspection of the produced garments
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Assembling with polybag,carton etc
Preparation of banking
Shipment / Delivery.
7.2. Negotiation (Price) Process and Ending of Negotiation:
After confirming the order Company does an agreement between buyer and Merchandiser.
In the contract normally shows the Purchase Order # & style # based on what Essays
proceeds under this contract. After completion the contract with two parties we submit the
contract to our bank & start sourcing of different fabric and trims.
A successful negotiation outcome does not generally occur through luck, but by following a
clear process. The process reflects the different levels of knowledge of the subject of
negotiation, various parties and the way they communicate at various stages in the
negotiation. The following is an outline of steps essential to effective negotiation:
Preparation
Effective preparation is also vital to successful communication. It is essential that the buyer
also has identified the maximum and minimum positions that she will accept for a range of
factors including:
product price
order size
Lead- time.
Offer
The buyer and supplier can make specific proposals to set the boundaries of the negotiation.
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Counter and revised offers
This is the real bargaining where elements of the order, such as number of units,
product details, and lead-time and so on are being decided in the context of an overall
cost price the buyer should make firm proposals.
7.3. Negotiation (Price) Process and Ending of Negotiation as following:
Arrange a meeting
Show the price to buyer
Buyer asked about high price
Arguments about high price with buyer
Buyer show the new price
Make win situation
Fixed price
Placed a new order
Ending the negotiation by dinner
7.4. Process For Implementing Merchandise Plans:
Information is gathered about target market needs and prospective suppliers.
The retailer chooses firm-owned, outside, regularly used and/or new supply sources
of merchandise.
The merchandise under consideration is evaluated through inspection, sampling
and/or description.
Purchase terms are set. They may have to be negotiated in their entirety or through
uniform contracts.
The purchase conclusion is made-manually or automatically.
Merchandise handling decisions are taken relating to receiving & storing, price &
inventory marking, displays, pilferage control etc.
Reordering decisions are made.
Re-evaluation of merchandising plans takes plac
Garment merchandising process starts once the order / fabric commitment is received and the
product development department hands over the file to production merchandiser and ends
when the goods reach the buyers. The entire cycle involves all activities directly or indirectly
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related to procuring of materials, planning and monitoring of the order. A brief outline of the
procedure is as below:
Merchandising process flow
PREPARE
DETAILED T&A
FABRIC ORDERING FIT CYCLETRIM ORDERING
FABRIC PO,
PI, LC
PILOT YARDAGE IN-
HOUSE
INSPECTION
SHRINKAGE TEST
BULK IN-HOUSE
INSPECTION
TEST REPORTS
TRIM PO,
PI
BULK IN-HOUSE
INSPECTION
TEST REPORTS
FIT
APPROVAL
SIZE SET &
SEALER SAMPLE
APPROVAL
PRE-PRODUCTION MEETING
ALL DEPARTMENTS
ADVISED OF THE
T&A
RECEIPT OF ORDER
PILOT RUN APPROVAL
BULK
CUTTING
SEWING
FINISHING
PACKING
FINAL AUDIT
SHIPMENT OF GOODS
AUDITS DONE AT
VARIOUS STAGES
OF PRODUCTION,
TOP/PRS
SAMPLES SENT
TO BUYER AS PER
REQUIREMENTS.
PREPARE
DETAILED T&A
FABRIC ORDERING FIT CYCLETRIM ORDERING
FABRIC PO,
PI, LC
PILOT YARDAGE IN-
HOUSE
INSPECTION
SHRINKAGE TEST
BULK IN-HOUSE
INSPECTION
TEST REPORTS
TRIM PO,
PI
BULK IN-HOUSE
INSPECTION
TEST REPORTS
FIT
APPROVAL
SIZE SET &
SEALER SAMPLE
APPROVAL
PRE-PRODUCTION MEETING
ALL DEPARTMENTS
ADVISED OF THE
T&A
RECEIPT OF ORDER
PILOT RUN APPROVAL
BULK
CUTTING
SEWING
FINISHING
PACKING
FINAL AUDIT
SHIPMENT OF GOODS
AUDITS DONE AT
VARIOUS STAGES
OF PRODUCTION,
TOP/PRS
SAMPLES SENT
TO BUYER AS PER
REQUIREMENTS.
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7.5. Receipt of Order.
Receipt of an order means final confirmation of the order from the buyer. Since, this
is the final confirmation it is done by means of a legal document called a PO
(purchase order) or an FC (fabric commitment).
PO (purchase order) – this is a legal document stating the quantity, delivery, price,
style no, buyer, vendor details. On receipt of a PO it is very important that the
merchandiser checks all details and confirms that they are correct like – quantity,
delivery date, and price, style no, style description, color no & reference if mentioned,
shipment mode, shipment port, vendor address, buyer address.
FC (fabric commitment) – fabric commitment is a legal document confirming that
the buyer will be buying the said quantity of a particular fabric. A garment style no
need not be mentioned on this document as it is a commitment only for buying fabric.
This kind of a legal document is used by the buyer when there are very probable
chances of change in the style or the same fabric is being used in a number of styles
and the buyer has still not decided on the quantity to be purchased in each of the
styles. Hence in such a situation the buyer gives a block booking for fabric.
Once the order is received four different activities are started off simultaneously.
These activities are – preparing a detailed T&A, Fabric Ordering, Trim Ordering, fit
cycle and sample approvals.
7.6. Time & Action plan (T&A) Preparations.
Time & Action planning is a process which will help you to focus your ideas and to decide
what steps you need to take to achieve particular goals that you may have. It is a statement of
what you went to achieve over a given period of time. An effective action plan should give
you a concrete timetable and set of clearly defined steps to help you to reach your target. Ina
garments factory time & action plan maintained by executive summary which is done and
follow up by merchant. Actually T&A start at the time of buyer proposed projection.
According to garments projection factory merchandiser give projection of fabric and all trims
to relevant supplier. So we can understand that T&A start before the production.
In brief we can say that according to T&A we will allocate our production line for any
particular style. By this we have clear idea about fabric and trims booking their production
lead time & in house date. So by proper T&A we can successfully run our allocated line for
each style to hit the accurate TOD.
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Example:
ISW OPD TOD Comments
WK 17(19th
Apr) WK 2(4th
Jan) WK 11(7th
Mar) for local fabrics
WK 21(17th
May) Wk 2(4th
Jan) WK 15(4th
Apr) for foreign fabrics
ISW: (Estimated shop week): ISW means the week of garments entrance in shop. Here
Monday is the only day of any week for garments to shop entrance.
OPD (Order placing date): OPD means the week of order placing. Here Monday is the only
day of any week for order placing.
TOD (Time of delivery): TOD means the week of delivery. Here Sunday is the only day of
any week for garments delivery.
We have to give final inspection in morning after 9 am on the date of TOD. If goods qualities
are ok for shipment then buyer QC will give ok to ship copy. Garments reach in port with this
ok to ship certificate & shipping agent will take the garments in their wire house. Shipping
agent will not accept garments if supplier can‟t show ok to ship copy.
7.7. According to T&A we will do our work according to below time schedule:-
Fabrics booking will be done with in 4th
Jan both foreign & local.
Supplier will start production of fabrics.
We will ask for sample fabrics for size set samples at 10th
Jan with available color but
with actual construction. Because, construction is related with fabrics shrinkage,
which effect fit or size measurement of a garment.
They will ask for counter samples & in house test fabrics at 24th
Jan. We will take all
accessories approval before order placing just after projection.
We also complete all foreign accessories booking with in 5th
Jan we will take 40% of
sewing foreign accessories & 10% of finishing foreign Accessories by air with in 14th
Jan. Rest of all qty by sea.
We will first start production with local fabrics than after foreign fabrics in-house, we
will minimize local fabrics line & start foreign fabrics line at full speed.
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Figu
re6
.2
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7.8. Fabric Ordering.
This activity involves ordering of fabric with the mill. The important points to be taken care
of during this activity are: Accurate computation of the requirement. This is essential to
ensure that during bulk production the materials do not fall short nor are they in access and
there are leftovers after the order is shipped. An accurate calculation of material requirement
can be done if the BOM (bill of materials) as provided by the buyer in the specification sheet
is studied thoroughly. Apart from just ensuring that the quantity is correct the BOM also
helps in checking that all materials required in completion of the order are ordered and
nothing has been missed out. Selecting the best vendor for the materials in terms of quality,
price and delivery.
7.9. Payment Term.
The fabric order is places by the merchandiser by means of a purchase order. The purchase
order should list down the following very clearly –
Name & Reference no of the article.
Quality description of the article.
Quantity.
Price.
Delivery date.
Quality parameters as required by the buyer.
Payment terms.
Pilot yardage requirements if any.
The mill sends a PI (Performa invoice) confirming the details as mentioned in the PO. In case
of any changes required in the PO the same are also mentioned in the PI. The mill also
provides its bank details on the PI so that the factory can work out the payments. There can
be various kinds of payment term agreements between the buying and the selling parties as
below –
Some percent of payment in advance, the balance at sight – example, 20% advance, 80%
at sight. This means that 20% of the total value of goods is paid in advance, the balance
80% is pain once the goods are received by the buyer (factory). This payment can be done
by means of DD (demand draft), cheque or TT (telegraphic transfer)
LC (letter of credit) – in this payment mode the banks of both parties are involved. The
buying party (factory in case of fabric) opens up a LC with its bank and the same is
transferred to the mills bank. On acceptance of the LC by the mills bank, this becomes a
legal contract between the two parties. Once the goods are dispatched the mill submits the
dispatch details (Invoice, packing list and Air way bill details) in its bank and gets the
payment for the goods. The mills bank then approaches the factories bank and gets its
payment from the same. The factories bank then gets the payment from the factory. The
LC once made, a copy of the same should be called in by the merchandiser and studied to
make sure all details as mentioned are correct. The details to be looked at are:
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Name & Reference no of the article.
Quality description of the article.
Quantity.
Price.
Delivery date.
LC expiry date.
7.10. Pilot Yardage.
Pilot yardage helps is ascertaining any problems that may come in the bulk yardage. The mill
processes the first 100 – 200 yardage to ensure that the same meets the quality, color
parameters as laid down by the customer. This helps the mill in taking corrective actions to
eliminate any defects or problems. On the other hand the factory also requires yardage to
complete all the pre-production processes such as sample approvals, size set etc. This pilot
yardage helps the factory in making all the pre-production samples. Also the factory does
fabric inspection and fabric shrinkage test to have an idea of how the bulk fabric will behave.
At this stage if factory observes any problems in fabric behavior the same is immediately
conveyed to the mill so that the mill can take corrective action.
7.11. Inspection.
Fabric inspection report:
This is generally a third part inspection done by buyer nominated inspection company like
ITS, MTL etc. The most common and used method of inspection is the 4-point system. In this
system every defect is given a point between 1to 4 based on the nature of the defects. A
maximum of 4 points per yards of fabric can be allocated. Fabric having more those 40 points
per 100 square yards is considered to be rejected. Different customers have different point
levels depending upon how premium the brand is and also on the nature of the fabric. For
example: a manmade fiber should have lesser defects that a natural fiber and hence
acceptable points level for polyester is kept lower than that of cotton.
Fabric shade band:
The mill segregates the fabric on the basis of shade and makes a shade band. In general a
maximum of 3 shade bands are acceptable by customer, however this can again vary from
customer to customer. The customer evaluates the different shades by means of a grey scale
rating as acceptable.
Fabric test report (FPT – fabric performance test):
Yardage from bulk is sent to the nominated testing laboratory such as MTL, ITS for testing
the physical and color parameters of the fabric as required by the customer. The testing
laboratory also provides a wash care instruction for the fabric, which essentially means the
best washing conditions for the fabric.
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Fabric shrinkage report:
The mill tests 10% of the fabric to confirm that the fabric adheres to the specifications as laid
down by the customer. For example if the customer accepts +/- 3% shrinkage, fabric having
5% shrinkage is rejected. The determining the shrinkage the fabric is tested as per the best
washing conditions advised by the testing laboratory on the fabric test report.
Once fabric passes through all the above tests and inspections it is shipped to factory. The
factory again checks the fabric on 4-point system and also checks the shade bands and
also does fabric shrinkage test to confirm that they adhere to the requirements of the
buyer.
With regards to fabric inspection the factory generally inspects 10% of the fabric, in case
there is a problem the factory goes on to inspect 100% of the fabric.
For fabric shrinkage test – different procedures have to be adopted for ascertaining the
shrinkages for a washed and a non-washed style.
The shrinkage that needs to be included in the pattern. The fabric is washed based on the
recommended wash care instructions in the FPT.
In case of a washed garment, 100% fabric should be tested for shrinkage. The test is done
as per the wash recipe. Once all rolls are tested, the rolls are segregated as per the
shrinkages and different patterns are made to incorporate the shrinkages.
Factory then also checks the fabric for shade banding, compares the same with the once
sent by the mill and if found acceptable sends one sent out to log the same with customer.
Once the buyer confirms that the shade bands are ok, the fabric is ready to be cut.
7.12. Trims ordering.
It is a similar process as done for the fabric is done for trims except for pilot trims. The
factory can call in trims for sampling and these are called as PROMO TRIMS.
Sampling
Sample making is one of the most important activities in the garment manufacturing process.
The manufacturer always needs at least a sketch of the garment, original patterns,
specification and the designer‟s sample to make high quality sample garments at the
contractor‟s factories. Garments factories are used different name used for different types of
samples. In the sample departments of garment factories different type of sample are made
for different purposes.
Proto Sample.
Approval Sample.
Fit Sample.
Size set Sample.
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Reference Sample.
Offer Sample.
Salesman Sample.
Photo Sample.
Pre Production Sample.
Production sample.
Shipment Sample.
Proto Sample: Proto sample is the initial sample made by the manufacturer as per as the
details of the export order, and send to the buyer, to check whether the styling of the garment
is ok as per the requirement of the buyer. Proto Sample can be made in alternative fabric &
accessories, which is not with the original fabric and accessories. That is as per the sketch &
space in the production order (P.O) sheet).
Approval sample: The manufacturing must produce sample prior to communication of the
mass scale production of a particular style. The number of samples required, vary from buyer
to buyer. Most of the time buyers ask for 3-5 samples from the manufacturer. When
constructing these samples the manufacture‟s instruction should be followed.
The original patterns, original sample & the specification are required to produce these
samples. After constructing these samples manufacturer should send them to the buyer or to
the agents to get the approval for the mass production. There are two main types of approval
samples and they are known as:
Fit approval samples.
Size series samples.
When an order is placed and confirmed, the manufacturer has to produce samples for the
buyer. The required size of the samples is generally given by the buyer. If the size of samples
is not given the middle size of the order range is taken as the appropriate size. That is if an
order is given for a range of sizes, then the sample garment is made from the middle size. The
samples produce for the given size or the middle sizes of the order are known as fit approval
samples.
Once fit approval samples are approved by the buyers, request for samples in all the sizes of
the order before the mass production starts. Then they are in a position to see the quality of
the samples of all size of the order. These samples are known as size series samples. Even if
there is no such request from the buyer, it is batter to produce to size series samples for use
within the factory. Then they can identify the problem that might occur, when they produce
different size in the mass production.
Fit Sample: Fit Sample is made by the manufacture (exporter) and sends to the buyer, to
check if the fittings of the garments are ok or not as per the requirement of the Buyer.
Unusually the Fit sample is made in alternative Fabric & accessories & it is made, which ever
comes at the middle of the export order sizes. For example: If the export order sizes are, S,
M&L, the Fit Sample will be in M size.
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Size Set Sample: Size set sample contains all the size of the export order contains sizes
small, medium, large size. Then the size set is sample will contain all the size, the sample S
are made by grading the M size sample. Alternative fabric & accessories can make this
Sample.
PP Sample (Pre Production sample): original fabric & Accessories make PP Sample, and
this sample is made just before the Bulk production. This sample represents the original
garment to be made in Bulk production. The buyer checks the PP samples & after the Buyer
gives approval on PP sample, and then only the manufacture goes for bulk production of the
export order. PP sample should include all the colors of the style.
Production Sample: Production Sample is taken from production unit, by the bulk
production is continuing, production sample represents the original production pieces to be
exported to Buyer. Usually the exporter send production sample to Buyer once only, during
the Bulk production, But in some cases where the export order quantity is large enough for
single style for example in case of Buyer – Wal-Mart,
The production samples were sent three times during the Bulk production. First Sample sent
during 20% to 30% of Bulk production. Second fit sample sent during 50% to 60% of Bulk
production and third production sample sent during 70% to 80% of Bulk Production.
Reference sample: Reference purpose when produce the extra sample is called reference
sample. When we produce the approval sample then we have to produce an extra sample for
reference purposes in the factory, Reference sample is also called keep sample. After getting
the approval from buyer, the reference sample can be released for mass production.
When releasing the reference sample for mass production all this comment made by agents
and or by the buyer must be attached clearly to the reference samples. The sample kept in the
sample department until getting the approval from the buyers after inspecting the approval
samples.
Offer Samples: If the factory wants to attract new buyers, they have to be won by showing
samples of garments that the manufacturer can offer. For this purpose they produce on their
own, samples of new designs. These samples are known as offer samples. The ultimate
objective of producing these offer samples is to attract new buyers to find new markets.
Shipment Sample: This Sample the manufacture keeps with them, covering all sizes &
colors of the style of garments they exported. It is for the reference pieces, just to keep record
for future reference.
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7.13. Production Sampling.
Production goes through different kind of stapes. It needs many quality checking and
approval to be perfect. The steps are defined below.
Sample approval
While fabric and trim ordering is happening, simultaneously the sample approval procedure
is also underway. The moment a style is selected it goes to the tech department for fitting.
Here models wear the samples and they are evaluated in terms of fit, construction,
measurement. The buyer then sends out comments, which are called as fit comments. In case
another sample is requested the factory makes the same incorporating the comments and send
again to buyer. This process is called fit cycle. Different customers have different no of fit
cycles.
PP Sample
Once the fit sample is approved the factory makes a PP (Pre-production) sample. This can be
called by different names such as sealer sample, green tag sample etc. This sample is sent out
the buyer for final approval and once approved becomes the final sample on the basis of
which entire production is made and audited. This is the most important sample and one
should take care that everything on this sample is correct as this then becomes the standard.
Size set
Once PP sample is approved the next step is to make a SIZE SET. All the fit samples and the
PP samples are in the medium size, now the medium size is graded into the different sizes as
per the purchase order. The basic purpose of size set is to ensure that grading between sizes is
correct.
Pre-Production meeting
In this meeting everybody concerned with the style sits together to make sure that everybody
is on the same page and understands the product. Hence, this meeting has the merchandiser,
production in-charge, cutting, finishing, fabric in-charge, line supervisor, pattern master,
sample master etc. All tentative problems are discussed and solutions sought to execute the
order smoothly.
Pilot run
Once pre-production meeting is done the factory does PILOT RUN. Factory cuts 100-200
garments based on the order quantity. The pilot run is done on the assembly line and is aimed
at ensuring that the operators of the assemble line understand the required quality levels. This
is very essential since all samples prior to the pilot run (fit samples, PP & size set) are made
in the sampling unit. Once PILOT RUN is approved the factory goes into bulk production.
In line and interim inspections are performed during the production process to ensure that the
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final product quality meets the required quality level. Once 80-90% of the goods are packed a
pre-final audit is done. This helps in taking corrective action if required before the final audit.
Generally since the final audit happens very close to the shipment date, the pre-final gives
factory a chance to amend problems if any.
Final audit
This is the last checkpoint before shipment. All aspects (packing, packaging, measurement,
construction & visuals) are evaluated. Once the garments adhere to the required quality
standards in all the parameters the shipment is passed and then the shipment is moved to thee
logistic team.
Now the merchandiser interacts with the logistic department, takes the shipment schedule and
sends the same to the customer.
7.14. Merchandising Season.
The overall operation of a company has fixed a cycle which is dictated by the unchanging
sequence and durations that is called seasons.
For clothing manufacturers, this means that certain deadlines have to be met if
merchandise is to reach retailers at the right time to meet the seasonal demands of the
general public.
7.15. Types of Merchandising Season:
For many years, most of the clothing industry worked on three-phase year which covered
four seasons as follows:
Phase-1: Spring merchandise.
Phase-2: Summer merchandise.
Phase-3: Combined Autumn & Winter merchandise.
A more recent selling pattern is to have three seasons during the year, with each season
divided into two seasons so as to introduce new merchandise to the public during the season.
The patterns are:
Spring-1: Spring merchandise.
Spring-2: Late Spring & early summer merchandise.
Summer-1: Summer merchandise
Summer-2: Late Summer & early autumn merchandise.
Winter-1: Autumn & early winter merchandise.
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Winter-2: Winter merchandise.
H & M Buyer:
Spring =Oct-Dec
Summer =Jan-March
Fall =April-June
Holiday =July-Sep
(Order pressure on fall season)
GAP Buyer:
Fall =Jan-Jun
Spring =July-Dec
(Order pressure on spring season)
NIKE Buyer:
Spring =Sep-Dec
Summer=Jan-April
Holiday =May-August
(Order Pressure on summer season)
Oshkosh Buyer:
Season 1 =Oct-Dec
Season 2 =Jan-March
Season 3 =July-Sep
Season 4 =April-June
(Order Pressure on season 3)
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7.16. Inspection Schedule of Different Buyer.
For year 2010
Buyer Name: H & M
Quantity: 150000
Order
placeme
nt date
Sewing
running
Wash
complete
Finishing
complete
1st
inspection
Final
inspection
First
Deliver
Second
Deliver
Comme
nts
4th
April
24th
April
5-6th
June
8-9th
June
10-11th
June
13th
June 13th
June
80,000pcs
27th
June
70,000pcs
For
local
Fabrics
For year 2010
Buyer Name: GAP
Quantity: 200000
Order
placement
date
Sewing
running
Wash
complete
Finishing
complete
1st
inspection
Final
inspection
First
Deliver
Second
Deliver
Co
mm
ents
2nd July 2nd
August
5-6th
Oct 8-9th
Nov
10-11th
Nov
13th
Nov 19th
Dec
100000pcs
26th
Dec
100000pcs
For
fore
ign
fabr
ics
For year 2010
Buyer Name: NIKE
Quantity: 100000
Order
placement
date
Sewing
runnin
g
Wash
complet
e
Finishin
g
complete
1st
inspectio
n
Final
inspect
ion
First Deliver Second
Deliver
Comm
ents
6th Jan 2nd
March
5-6th
May
8-9th
June
10-11th
June
13th
July
19th
July
50,000pcs
26th
July
50,000pcs
For
foreig
n
fabrics
For year 2010
Buyer Name: Oshkosh
Quantity: 110000
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Order
placement
date
Sewing
runnin
g
Wash
complet
e
Finishin
g
complete
1st
inspecti
on
Final
inspection
First
Deliver
Second
Deliver
Com
ments
5th July 25th
March
5-6th
May
8-9th
June
10-11th
June
13th
July 19th
July
55000pcs
26th
July
550000pcs
For
local
fabric
s
Shipment:
There are three types of shipment process for garments. Which we get from order sheet.
1. Sea by Sea: Garments will go by sea from loading country to destination country.
2. Sea/ Air: From loading country garments will be go till Singapore or port Kelang (As
Singapore and port Kelang is the transit point) by sea & will go to last distention by Air.
3. Air: By Air: Garments will go by air from loading country to destination country.
H & M inspection schedule
First Deliver
Sea +Sea/Air (Sun- Monday):- Must handover goods to Chittagong port within Monday night
12 Pm.
Air :-( Sun – Thursday) Must handover goods to Dhaka Air port with in Sunday night 12pm.
Second Deliver
Sea (Thus +Wed):- Must handover goods to Chittagong port within Wednesday night 12 Pm.
If 2nd
cut off will be Sea/Air:- Inspection will be done at (Sun-Mon)
GAP inspection schedule
First Deliver
Sea +Sea/Air (Sun +Monday) :- Must handover goods to Chittagong port within Monday
night 12 Pm.
Air :-( Sun – Thursday) Must handover goods to Dhaka Air port with in Sunday night 12pm.
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Second Deliver
Sea (Thus +Wed):- Must handover goods to Chittagong port within Wednesday night 12 Pm.
If 2nd
cut off will be Sea/Air: - Inspection will be done at (Sun-Mon)
Nike inspection schedule
First Deliver
Sea+ Sea/Air (Sun +Monday):- Must handover goods to Chittagong port within Monday
night 12 Pm.
Air :-( Sun – Thursday) Must handover goods to Dhaka Air port within Sunday night 12pm.
Second Deliver
Sea (Thus +Wed):- Must handover goods to Chittagong port within Wednesday night 12 Pm.
If 2nd
cut off will be Sea/Air:- Inspection will be done at (Sun-Mon)
Oshkosh inspection schedule
First Deliver
Sea +Sea/Air (Sun+ Monday):- Must handover goods to Chittagong port within Monday
night 12 Pm.
Air :-( Sun +Thursday) must handover goods to Dhaka Air port with in Sunday night 12pm?
Second Deliver
Sea (Thus +Wed) :- Must handover goods to Chittagong port within Wednesday night 12 Pm.
If 2nd
cut off will be Sea/Air: - Inspection will be done at (Sun-Mon)
8. SOME IMPORTANT SOURCING AND PRODUCTION DEVELOP
CONTROLLING PROCEDURE:-
8.1. Sourcing:
Bangladesh experts apparel items of more than 3,781.94 million dollars per year (Source:
Bangladesh Exports Promotion Bureau), but fewer and fewer companies manufacturing
in their won factories, sourcing is a growing responsibility. Sourcing may be the sole
responsibility of merchandising; it may be an independent, senior-level management
function; or it may be a shared responsibility. Whichever the case‟ the merchandiser must
understand the complexities of domestic and international sourcing. The term sourcing
implies the processes involved in procurement of the desired merchandise at the best
bargain from the most suitable source, with the objective of optimizing the cost, efforts
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and time. Sourcing can also be defined as the process of identifying, conducting
negotiations with, and forming supply agreements with vendors of goods and services.
The elements of sourcing are spread across the various stages of the product development
process, such as the „Final Product Development‟ stage and the „Manufacturing Package‟
stage. The sourcing process has been depicted through the process flow diagrams on the
following pages. Determining how and where to manufacture apparel products has
become a major concern for most companies. A good sourcing executive must have a
working knowledge of manufacturing processes, quality assurance producer, garment
costing, product development, government quota and import legislation, international
culture and business practices and international banking and legal procedure. In addition,
the sourcing executive must be an excellent negotiator. When the responsibility for
sourcing falls upon the shoulders of merchandisers, it becomes extremely difficult for
them to fulfill this responsibility while dealing with the demanding task of product
development and meeting production deadlines. In many companies some of the product
development responsibilities such as Prototyping and fabric procurement are transferred
to the sourcing contractor as a value-added function. This occurs in the sourcing
contractor to review the progress of the current production others and also to work on
development the new product line.
8.2. Sales & Marketing Interface:-
Line planning, style selection and line presentation require a close working relationship
among merchandising, sales and marketing. Throughout the entire product development
process, merchandising should be obtaining valuable input from sales and marketing as to
how current styles are sealing at retail and trend projection from retail buyers. Periodic
style preview meetings to discuss line direction and line adoption meetings allow sales
and marketing to buy into the fine line. A good sales stuff maintenance constant
communication with key accounts and can therefore provide valuable current information
on changing market trends in retail sales. Merchandisers participate in line presentation to
the sales force during seasonal sales meetings. Merchandising has modeled the line plan
and developed the concept that holds the product themes and groupings together. It is
important for the merchandiser to be able the sales force in how best to clearly present
these concepts to the buyer. Merchandiser may attend a few sales presentation during a
season to get a firsthand understanding of how the buyer response to the line. Attending
sales presentations may be difficult for merchandisers because of their hectic schedule,
but this opportunity to see the buyers‟ reaction to the line can be quit valuable in helping
to maintain a clear understanding of the target market. A survey shows that the
merchandisers are responsible for fashion forecast. The merchandisers often use these
forecasts to commit early production authorization. This is especially critical for off-shore
production, which required a longer lead time than domestic production. Many times
these commitments must in advance of the line release data.
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8.3. Product Development. Many apparel companies offer new style nearly every
month. The number of increased offerings creates an almost continuous mode in most
design departments. The merchandisers are responsible for coordinating design
activities. Merchandising must provide rigorous controls of the product development
process to ensure that balanced groupings of style are ready for each offering. At the
same time, companies are also trying to compress the product development time-line
to allow fabric and styling decisions to be responsive to the needs and wants of the
target customer, thereby improving retail sell-through and reducing the risk of
markdowns. Careful control of the product development process is vital to the success
of an apparel company.
The product development process begins with market and fashion research & ends
with the final session of the review. The product development process includes many
interrelated functions that effect on another. A poor decision or a delay in fabric
selection, creating a prototype, developing patterns, or preliminary costing could
eventually require redefining the line plan or development of new style concepts. The
merchandiser must keep a tight rein on the entire process if a company is to have the
most effective style ready for line release. The merchandising calendar is used to
establish time schedule and accountability for ach function of product development.
The merchandiser must monitor the calendar to see each functions completed on time
or must make adjustments for any missed deadlines. In order to unleash the full
creativity of a designer or stylist, it is important to have a „business mind‟ Organized
and controlling the product development process. The merchandisers perform this
function by providing a creative environment and positive direction for the design
team without losing sight of the marketability of the line. After all, merchandising is
responsible for the end product being stable and profitable. The entire process must be
accomplished while the critical timetables necessary to get the line completed by the
line release date are maintained.
8.4. Production Authorization.
Many apparel companies must commit to production before meaningful sales have
been generated, someone must decide what and how much to manufacture.
Merchandiser is directly responsible for production authorization. Merchandiser use
past sales histories, current market research, advances sales advice, and sales
forecasting models to make production authorization commitments. Unfortunately
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there are no magic crystal ball forecasting models that can be zero in on the exact
styles by size and colors that will sold in any given season. An increasing focus is
being placed on forecasting systems. Apparel firms and retailers are striving to build
effect decision support system, fueled by data warehouses, to capture and analyze
their data, and provide them with completely new way to look at their vast amounts of
data on sales, customers and operations. The high cost of data warehouse technology
has caused most apparel companies to shy away from this high-tech approach for
forecasting.
8.5. Product Information System
Product information system or PIS refers to processes and technologies focused on
centrally managing information about products, with a focus on the data required to
market and sell the products through one or more software. A central set of product data
can be used to feed consistent, accurate and up-to-date information to multiple output
media such as web sites, print catalogs, ERP systems, and electronic data feeds to trading
partners. PIS generally need to support multiple data entry, multi-lingual data, and
maintenance and modification of product information within a centralized catalog to
provide consistently accurate information to multiple products in a cost-effective manner.
Production information system consists of every detail from cutting to sewing
like in cutting the data entered in bundle numbers, in sewing data entered per hour
production input & output wise by style number. Color wise.
NPT report- per day M/C cost $14.2
Per hour M/C cost $ 1.42
Software used in viyellatex
ESFS- efficient shop floor solution
FIS – factory information style
8.6. Efficiency calculation
Efficiency = No of operator x working hour x 60 x 100%
No of production x SMV
= 28 x 10 x 60 x 100%
800 x 21.45
= 16800 x 100%
17160
= 97%
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Profit loss calculation
Only for sewing
= No of M/C x working hour x per hr M/C cost
= 20 x 5 x $1.42
= $142 cost per gmt
Earning
= cost making x production pcs
12
= 10 x 480
12
= $ 400
So profit will be = $400-$142
= $258
8.7. Fis Used For Daily Production:-
FIS is used for daily production status report input by an operator in the sewing floor,
called reporter.
FIS consists of
Buyer
Style
Color
Size
Parts names
Style No
Color
Order No
Order quantity
To be shift (drop)
Cutting No
Send qty
Receive qty
Rejection
Factory name(in case of sub)
Sewing input – daily
Sewing output – daily
Finishing input – daily/total
Finishing output – daily/total
Polly for urgent gmt
Shipment status
Print & embroidery
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8.8. Basic knowledge of Work Study:
Observed time:
It is the time taken by the operator to operator complete his her job as observer d time by
work-study officer.
Basic time:
It is the time taken by the operator to operator complete his or her job had she or he
worked at 100% performance.
Allowance time:
It is the time allowed to an operator for non performing task such as going to laboratory,
rest, changing needle, taking instruction of supervisor etc.
Relaxation allowance:
It is the time allowed to an operator to attend to personal need.
Contingency allowance:
It is the time allowed to the operator when uncertain problem occur.
Machine delay allowance:
It is the time allowed to an operator for delay due to machine maintenance.
Style change allowance:
It is the time allowed to the operator where frequently style change occurs.
Special allowance:
It is the time allowed to an operator for start up time, shut down, cleaning etc.
Standard time:
It is the time required by operator to complete a job had she worked at 100% rating plus
allowance time.
Bottleneck time:
It is the highest time taken b y an operator compared to other operator‟s time, generally it
is the time beyond the U.C.L.
Rating
Rating is a speed of a qualified worker.
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Organization efficiency
It is the efficiency of the production time.
Basic work content:
It is the time contents the work without any undue loss of time.
Work count:
It is the time value required by operation.
Ineffective time:
It is the time means time loss due to different design fault, production fault, finishing fault
etc.
Upper control limit:
Upper control limit is the time limit represents efficiency.
Lower control limit:
Lower control limit is the time limit representing 115% efficiency.
Pitch time:
Pitch time is the time taken by operator on average or Industrial operator‟s time shown on
the pitch diagram is called pitch time.
8.9. Work study is the most accurate method of setting Standard of performance
upon which effective planning and production control relies upon.
Production calculation formula:
BPT (Basic Pitch Time) = Total standard time÷ No of operator
UCL (Upper Control Limit) = Basic pitch time÷ 0.85
LCL (Lower Control Limit) = 2×BPT-UCL
Organization Efficiency = BPT÷ Highest bottleneck time×100
Productivity = per hour production ÷ Total operator
Production Target = (No of operator×3600) ×85% ÷ Total standard time
Actual production = 3600÷Height bottleneck time
Work study method comprises eight steps, which are given below:-
Select: Select the job to be investigated.
Record: record data by collecting organization by direct observation.
Examine: Examine data critically; what is the purpose of action, where is the place of
performing it, the sequence in which the job is done, the person doing the job etc.
Develop: Develop the easiest & the most economic methods.
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Evaluate: Evaluate the results of alternatives ways of doing the job.
Define: Define new method & time & present them to the concerned people.
Install: Install new method & train persons to apply them.
Maintain: Maintain new standard practice & set control procedures.
Why bottleneck time created:
The operator has not the right skill.
The operator makes more rejects & rework takes time.
The machine is definite.
The operator is not following work standard.
The operator is not motivated etc.
How to eliminate the bottleneck time:
By using automatic organization high performance machine.
By mechanizing the relevant processes.
By using better tools, folder, special work aids etc.
By allotting the bottle process between more than the operator.
By improving operator skill/ speed.
By using addition machinery/ operator etc.
9. IMPORTANT MARKETING STRATEGY FOR A MERCHANDISER :-
9.1. Marketing strategy:
Merchandisers should have a proper marketing strategy. They should examine the
factors involved in developing a detailed understanding a target market. Evaluate the
importance of market segmentation and alternate marketing and proper methods of
data collection and industry information sources.
9.2. Target Market:
Apparel merchandisers make key decisions that create next year‟s fashion trends. This
decision must be based upon an in-depth understanding of their companies‟ target market.
This requires current, accurate and reliable information. It is easy for an apparel company
with a solid market image to become complacent and lose sight of target market
customers. This was the case with jeans giant Levi Strauss in 1998 when it continued to
lose important market share in its primary jeans division. The young shoppers Levi‟s once
had in its back pocket had moved on to fresher, more exciting brands. The company had
been notoriously insular and confronted with lost sales and revenues. Levi‟s was so busy
maintaining the status quo that it took the customer for granted. It was so blinded by its
success is could not see the tarnish accruing to its image. Meanwhile a, host of powerful
and jazzy new companies arrived, including designer brand like Tommy Jeans and
DKNY Jeans, private brands like JC Penney‟s Arizona and Canyon River Blues, powerful
Page | 46
specialty retailers like Gap Inc. and a host of hot junior names like Muddy, Paris Blues,
LEI, JNCO and Fobs. Levi‟s was being squeezed on all sides. This weak-up call required
Levi‟s to take a closer look at its target market and listen to its ultimate consumers who
were no longer satisfied with classic five pocket jeans. Apparel merchandisers must
participate in developing the proper marketing mix for their target markets. The primary
variables involved in the marketing mix can be expressed by the four „P‟s of marketing.
They are-
Product, creating the „right‟ garment in terms of silhouette, fabric, color and fit for the
current needs of the target market. „Product‟ also includes the proper product mix within
a line of clothing.
Place, getting the „right‟ garment to the target market‟s „Place‟, which is the retail outlet
used by the target market consumers. This may be a retail store or a direct purchase
through catalog or internet sales. The garment reaches the customer through a channel of
distribution, the process that moves it form the ultimate consumer.
Promotion, informing the target market about the product. The promotion function
usually falls under the preview of the marketing department. However the merchandisers
are frequently responsible for developing the theme and direction for presenting the
„right‟ product to retailers and consumers. In many companies merchandisers also present
new apparel lines to the marketing department in seasonal sales meetings, emphasizing
how to best sell the silent features of the line.
Price, need to establish the right price for the right product. The merchandisers must
consider the competition in the target market and the cost of producing each garment as
well as manufacturing overhead and general and administrative costs. The consumer is
the key to the target market equation but is not an actual part of the marketing mix. The
consumer is the target for all marketing and merchandising efforts and is therefore the
central focus of the as in figure 3.1
Page | 47
9.3. Market Segmentation.
As markets changes companies must adjust their product lines to accommodate new
needs and desire of their ultimate customers. The process of redefining a target market in
to smaller more specialized segments is called market segmentation. For many companies
this process isn‟t well defined or completely understood. Consumer behavior is extremely
complex and is affected by many demographic characteristics. The task of total market
down into homogeneous segments that have a meaningful relationship to a company‟s
product mix is a formidable one. Some factors that are analyzed when a market is
segmented, demographically, changing age distributions, gender, ethnicity, salaries, social
class, geographic populations, family size, education, occupation and sending patterns;
psycho graphically, attitudes of a population, patterns of living, interests and options.
9.4. Alternate Marketing.
A well-executive market segmentation analysis may provide opportunity for alternate
marketing, which is increasing market share or developing new products or new markets
for an apparel company. Alternate marketing provides opportunities for companies to
grow by increasing the company‟s share of market for current products in current
markets, finding new markets for new products, creating new products for current market
and developing products for new market. This concept of alternate marketing is vital in
the ever changing apparel market place. In today‟s marketing driven business
environment, some companies have even found a fifth alternative- the „name game‟- in
which they increase market penetration by providing the same products under new,
catchy, designer-sounding names. In order to effectively use alternate marketing,
merchandisers must listen carefully to the changing needs of their customers.
9.5. Market Research.
Gathering, validating, interpreting and evaluating information can represent 30%-40% of
a merchandiser‟s time. Many apparel merchandisers have administrative assignments
whose full time job is maintaining information system. An ongoing process for
merchandisers is the interpretation of data collected to gather statistics about a market,
learn what a customer thanks about a company and its production, and learn how
customer behave under various condition. There are a number of methods for gathering
data. They fall into categories- quantitative research and qualitative research. Quantitative
research focus on response to questions that can be summarized by objective, statistical
results such as percentages, averages or degrees of agreement or disagreement. Ranking
for a style for a line form most saleable to last saleable is an example of quantitative data
gathering. Another form of quantitative analysis is asking respondents how much they
Page | 48
agree or disagree with the questionnaire statement. Qualitative research seeks open ended
responses such as, “what do you think when you purchase your garments”. Another
example is “what is your reaction when you see your friend is wearing a very well-
tailored suit and that that is not a famous brand”. Qualitative questions often require
follow-up questions so that the researcher can fully understand the motivations behind the
interviewee‟s responses.
10. WORK OF APPAREL MERCHANDISER.
10.1. Business Development Procedure of merchandiser.
It‟s an important job of merchandiser to develop business and get order form buyer so that
industries may reach their goal and get target profit and slam able to make a good will. To
develop the business it‟s essential to get order form buyer and to getting order form buyer is
possible when a merchandising department will represent his or her industry to the buyer. The
first step to build up new relationship with a buyer is to send an e-mail.
The first email should be very decant and enthusiastic so that a new buyer gets interested to
doing business with the industry. First email is the way to introduce his industry and his
products and quality. Through this email merchandiser tries to give all optimistic information
and a detail introduction of the industry
Here I mention a format of first email to buyer by which a clear idea will be build up about
how an email can be a part of business development and help to introduce an industry to the
buyers.
Dear Sir/Madam
We fell pleasure to introduce ourselves as one of the leading exporters of readymade
garments) woven, along with manufacturing units in Bangladesh.
We have been supplying all kinds of readymade garments for last 5 years successfully to our
clients in Europe, USA, Canada, Sweden, and Netherlands. With our existing structure we
able to supply quality Garments with guarantee Delivery in Schedule time with ever best
reasonable price. Production follow up done by our qualified and experienced quality
controller and based on this we able to produce the garments with international standard
quality gourmets.
Job responsibility
Primary sample, preproduction sample and final production sample approved by you.
Maintain strict time rime.
Emphasis and insist on 100% quality controlling,
Full time supervisions, monitoring and evolution of the work during the production and
shipment period.
Four individual high quality merchandising will engage for assign order,
Page | 49
More over if you have any particular choice we are ready to follow yours specification.
Exporting item:
Woven: Denim, sportswear, children wear, Trousers, Shirts, Unlined Jackets, Overall/short
all and School-wears.
10.2. First E-mail to the Buyer for Business Development.
10May, 2011
Y
Manager-
A Group of Industry
Sub: Business Development.
Dear Sir,
I would like to show the opportunity to introduce our company as one of the reputed
company to export readymade garments from Bangladesh to Europe and North America. We
have long experience with world famous companies like Wal-Mart, H&M, Zara, ITPS, and
Tame etc.
We are pleased to attach our brief profile in where you will find details of our company. We
are also sending photographs of some of the previous production in where you will find our
quality work.
It will be highly appreciated if you are kind enough to let us know your comments so that we
can send our samples by DHL for your better understanding.
We are anxiously waiting for your feedback.
Thanking you
Sincerely,
X
Manager-
Ananta group of Industry
Bangladesh.
10.3. Feed -Back From Buyer in Response to First Email.
After getting email from any industry buyer also gives feedback and sends a reply email
where buyer wants some sample or asks for any other detail required information. Buyer
wants some sample so that buyer can get an idea about quality and effectives of the industry.
Page | 50
10.4. Basic qualifications should have the Merchandisers.
Good command in English and adequate knowledge of technical terms for accurate and
efficient communication.
Good knowledge of fiber, yarn, fabric, dyeing, printing, finishing, dyes, colorfastness and
garments production etc.
Clear conception of the usual potential quality problem in apparel merchandising.
Good knowledge of the usual raw materials, raw materials inspection system and apparel
inspection system.
Knowledge of the buyer‟s compliance and various standards.
Knowledge of the quota system, free-trade, shipping and banking documentation.
10.5. Main function of a Merchandiser to execute an order perfectly on time
(schedule).
Fabric requirement calculation (consumption, YPD).
Accessories requirement, calculation.
Sourcing of fabrics.
Sourcing of accessories.
Possible date of arrival of fabrics and accessories.
Costing.
Garment analysis and production planning.
Performa making, swatch making and distribution to the production unit and quality
concern people.
Pre-shipment inspection schedule.
Arranging shipping documents and final inspection.
10.6. Factors of industrial buyer:
There have some factor of industrial buyer. Like
Big size
Geographic area
Some process and procedure
10.7. Daily correspondences with buyer.
Buyer sends this email
Dear Mr. X,
We have received the sample with good condition except for the fact that it has a shedding
problem. Please receive it and response immediately.
Thanking by
Y
Page | 51
Merchandiser replying this email
Dear Sir Y,
We received your mail and started working accordingly.
With best regards.
X
Merchandiser replying this email again
Dear Sir Y,
We rectify the sample and have already sent to you. And I am waiting for your kind advice.
With best regards.
X
10.8. Email to buyer in response to buyers complains.
Buyers complain.
Dear Mr. X,
Please note, we observed that your factory is ignoring some printing problem in some
garments. It is not occurring continuously but we think you should take care of it.
Thanking you
Y
Response to buyers complains
Dear sir Y,
We have got compliance letter. We sincerely apologies for our future in ensuring the idea
things. But we want to say that the problem you have mentionable is very exceptional in our
firm. It was an accident which unfortunately occurred the time which you we visiting. But we
can assure you that the incident will never occur again. We have already fixed this problem.
Hope this incident will not affect our relationship
Thanking you
X
10.9. Sending Quality Sample to the New Buyer for Better Understanding.
Page | 52
When the quality sample is sending to the new buyer for better understanding there are some
process should be followed for convince the buyer easily as a result the buyer will attract to
the quality sample. When you will send the quality sample to the new buyer always you
should keep in mind that it should be maintain professionalism and presentable. The format
may be followed -
Quality sample
Ironing properly
Checking quality points
List of the defects
Attracting packaging
Well decorated
Maintain professionalism & workmanship
10.10. Sampling Procedure:
Order from buyer
Sourcing the fabric & accessories for making garments
woven (sample only)
Cutting
Sewing
Iron
Quality control
Pre check form
Buyer Q C
Forwarding from the merchandiser
Sample sending to the buyer
10.11. Approval produces of sales samples.
Seal sample means to gain the approval from buyer before going to the bulk production.
Without seal sample can‟t go production. In order to achieve seal sample from the buyer you
should have followed some professionalism so that the buyer easily can give you seal. In
order to get seal sample from the buyer the following format may be followed-
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Quality sample for better understanding
Sending development sample
Sending fitting sample
Maintain quality
Maintain professionalism & beauty
Sales sample
Color Up
PUMA AUSTRALIA
Style: 803214 Col: 06, 07, 08 Line: Women
Foundation SL
Tee
Fac.: Harvest
Rich
WC off./agency:
Bangkok
Comments:
Artwork / Accessories:
PNO 00308 is in the correct position. Ensure stitching tension is correct and there are no
loose threads, stitching quality was better on strike offs. Col 08 print is too dark/grey, it
should be greener. Please refer to the strike off for color/quality/design approval.
PLA 00318 is in the correct position; please refer to the strike off for color/quality/design
approval.
Back neck binding quality is incorrect, it should be PTA 00106 (not self fabric).
Design / Optic:
Ensure the self fabric neckband and cuffs are 1cm wide throughout.
Workmanship:
Pleases follow all international comments for workmanship.
Size/Fit Comments:
Please follow all international comments for fit.
Changes:
Deviations: Fabric, details, labels and measurements must conform to article description.
Approved for Style: Lisa Eason
Page | 54
Date: 2/2/2006
In case of any discrepancy between sample and article description the last named has
priority
10.12. Sub-Contract Agreement.
The agreement for sub-contract is made on 29.06.2011 between:
STARLET APPARELS LTD. AND Garments sample house
Factory office. House B/134, Road - 22,
BSCIC, Fatullah, Narayangonj. (3RD
Floor) New duhs, Mohakhali
Narayangonj, Bangladesh. Dhaka-1206, Bangladesh.
(1st PARTY) (2
nd PARTY)
Both Parties are mutually agreed to execute the following order under the terms and
conditions mentioned bellow:
01 Style No. 140410
02 Style Name PNT, ACTIONS
03 Specification AS PER SAMPLE
04 Order Quantity 1692 Pcs
05 Types of work Product making
06 Fabric 100 % cotton;1/1;poplin;30/1;30/1;68;68;112g/m2;
Solid dyed; reactive dyed;
07 Rate/Dzn USD 20.00 Per Doz. @ BDT 68.00
08 Delivery Date 10.07.2011
Terms and Conditions:-
Goods will be inspected at 2nd
party‟s factory before taking delivery.
2nd
party will have to pay the cost of yarn and accessories if there are any losses/ rejection
/ damages of the goods.
Page | 55
Goods must be delivered on due date. 2nd
party will be liable in case of any loss or claim
for late delivery.
2nd
Party will collect the yarn and accessories from 1st party‟s factory. After weighting,
measuring and counting the yarn and accessories at the 1st party‟s factory, 1
st party will
not be responsible for any subsequent discrepancies.
1st party will take the delivery of finished goods from 2
nd party‟s factory.
1st party will take delivery of goods after cash payment.
2nd
Party will conduct the subcontract work as Ultiate Wool Wear Ltd.
2nd
Party will have no authority to transfer the order to any other factory without having
written permission from 1st party.
Production can be only start after size set has been approved by technical manager of
CGL (First party).
1st Party will assign a Q.A to 2
nd Party‟s factory & his instruction should be strictly
followed to respect the required quality standard.
1st Party 2
nd Party
STARLET APPARELS LTD. & Garments sample house
______________ ___________________
Authorized Signature Seal & Signature
10.13. Merchandising Procedure to Execute an Order.
If all Merchandiser used to follow the below Work-Flow chart then it would be easier for
them to keep control over his/her order from 1st day to the shipment of his/her orders.
Need to Receive Product Package to do Preliminary Costing.
Sampling to Confirm Order.
Price Confirmation.
Oder Confirmation.
Purchase Order (PO) Received, Analysis and Distribution to Respective Departments.
Need to Receive Color Standard.
Issue Pro-Forma Invoice to Get Export L/C And Export L/C Check Properly & Hand
Over to Commercial Department to Proceed for Execution Prepare CPS or TNA.
After Negotiation Fabrics & Accessories Price Need to Make Detail Pre Costing for BTB
Approval
Samples Fabric Accessories Commercial works
Proto/Initial/Counter
Making & Approval
Yarn/Fabrics
Suppliers Source &
Price Negotiation
List of Accessories
With Requirements
Page | 56
Sales Man Samples
Fabrics If Required
Lab Dip Submission
& Approval
Supplier Source &
Price Negotiation
Arrange P/I for &
Accessories
Red Seal/Fit/Size Set
L/Making& Approval
Fabrics Booking for
PPS & Quality
Approval
Accessories
Booking, Order &
Development
Collect Copy of BTB
Photo Sample Bulk Yarn/Fabrics
Requirement
Quality Approval Packing List &
Invoice
If Required Booking & Order All Accessories Prepare
PPS (Pre Production
system)
Shade & Quality Bulk Accessories Follow Up Of
Export
Making & Approval
Process
Approval of Bulk
Fabrics
In House Document
Productions/Set
Sample Making
&Approval
Shade Band/Dye Lot
Approval
Trim Card Prepare
For Approval
Wash Test Sample
Bulk Fabrics In
House
Trim Card Prepare
For Production
Gold Seal/Shipment Bulk Fabrics Wash
Test Approval
Poly & Carton Order
Color Way Swatch
Board Making
Poly & Carton In
House
If order is with Print/Wash/Embroidery/Other Embellishment sample have to develop with all
attachment. Before sample development separate strike off have to development to get
Color/Quality of Print/Embroidery/Other Embellishment and have to develop Wash Effect to
get approval before making samples to save time.
10.14. Buyer Approval Procedure of Fabrics, Color &Accessories by Supplier.
If supplier get all samples of raw material are as per his requirement then he gives the
approval. Supply chain department collects all raw materials as per buyer requirement. All
approval getting procedure are done by the merchandiser all accessories and farcies must be
approved by buyer. For color checking Lab dip will be prepared and get approval from buyer.
After getting all approval supply chain department give order to the suppliers and after stored
all the raw materials a trims card is prepared which consist all kinds of raw materials going to
used in the product as per buyer requirement. This trim card is also need to approve by buyer
Page | 57
so that production can be started. All type of approval procedure done by the merchandising
department.
12 Jan, 2011.
Dear Sir,
For approve the label in trim board.
10.15. Master LC Checking Procedure.
Buyer send a master LC copy to the industry and merchandising department send it to the
commercial department so that they can check all the terms and condition included in Master
LC. Without checking it, it is not possible to accept Master LC because may be there some
terms and condition will not match with the industry rules or capability that‟s why following
thinks should be checked carefully.
10.16. ML/C Confirmation Procedure.
After checking if anything required to change then merchandiser inform the buyer that some
correction should be added in the LC format and buyer correct those things and again
rechecked by the commercial department. If found everything of then merchandiser confirm
the buyer about the LC and accept it.
10.17. Different Types of Samples:
Development Sample:
The sample made by the manufacture, with their own Designs, to bring new orders for their
organization. This is the first sample, in the initial stage. The development can be made by
substitute fabric & accessories.
Page | 58
Fit Sample
Fit sample are made in one of the size which come at the middle Of the export order size. For
example: It will be “M” (medium size if the order size are “S” “M” & “L” or “S” “M” “L” &
“XL”. the fit sample is made after the order is confirmed & it is made to cheque weather the
fittings of the garment is ok or not. Fit sample can be made in substitute fabric & accessories.
Size Set Sample:
Size set sample, consisting of sample, covering all size in that export order .Samples can be
made either of original fabric & accessories or substitute fabric& accessories.
Pre- Production Sample:
This sample is made before going to bulk production in the production floor. This sample
represents the original production garment which needs to export. This sample is made with
original fabric & accessories, as pre the export order, with correct styling & measurement &
with no defect problem in that sample. The exporter will go to bulk production, once he get
approval from Buyer on P. P sample
Sales man Sample:
Sales man samples the Buyer require showing it in their store, to inform their Customer. This
is with original fabric & accessories.
Production Sample:
This sample the manufacture send to buyer, represent the original production pieces in the
production floor. This samples covering all size & all colors, taken from the production floor.
In case of big export order, where the export quantity is high for particular style, For
example: in Wal-Mart order, the production sample is send to Buyer, three times during, the
bulk production. After completion of 20% - 30% of the order, after completion of 50% - 60%
of the order, after completion of 70% - 80% of the order.
Shipment Sample:
This sample contains all size & all colors & style were exported to Buyer. These sample are
reference, the manufacture with him for his record. In needed for future reference, if any
claim comes from Buyer.
10.18. Emails to Supplier for Samples of Yarn, Fabrics and Different Types of
Accessories for Buyer Approval.
At first merchandiser need to contact with some suppliers to collect samples of yarn, fabrics
and any other accessories. Through email merchandiser ask different suppliers for sending
required samples. Those samples are collected and send to the buyer for approval.
Page | 59
10.19. Preparation of Data Bank Suppliers for Different Items.
Data bank means detail information of suppliers. This data bank helps to find out necessary
information of suppliers. Data bank maintained by software called supply chain software.
This software helps to organized suppliers information alphabet wise. So that it takes few
times to find our required suppliers. It also divided into two part, one is for local suppliers and
banknote is for if they need to import raw material from abroad. In data bank there are also
current prices of different raw materials are also include.
If information‟s suppliers are organized then it would be very easy to find out necessary
category and select proper suppliers.
10.20. MERCHANDISER SHOULD BE KNOWN DIFFERENT YARN COUNT:
Yarn Count, Gauge & Fabric type wise Minimum and Maximum Finish G.S.M Sheet
(1x1) RIB FABRICS
SINGLE JERSEY
YARN
COUNT
24 GAUGE YARN
COUNT
28 GAUGE YARN
COUNT
20 GAUGE
Finish G.S.M.
Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
MINIMUM MAXIMUM
20/1 200 230
26/1 170 180
20/1 200 220
22/1 190 205
28/1 160 170
40/2 190 210
24/1 180 195
30/1 145 160
34/2 230 240
26/1 170 180
32/1 135 145
30/2 240 260
28/1 150 165
34/1 125 135
26/2 260 280
30/1 140 155
40/1 115 125
32/1 130 140
44/1 100 115
34/1 120 130
50/1 90 100
40/1 110 120
YARN COUNT
18 GAUGE
Finish G.S.M.
MINIMUM MAXIMUM
24/1 250 280
26/1 230 240
28/1 220 230
30/1 200 210
32/1 180 190
34/1 170 180
40/1 150 160
(2x1) RIB FABRICS
YARN
COUNT
18 GAUGE
Finish G.S.M.
MINIMUM MAXIMUM
24/1 250 260
26/1 240 250
28/1 220 230
30/1 200 220
32/1 180 190
Page | 60
PLAIN INTERLOCK FABRICS
YARN
COUNT
24 GAUGE
YARN
COUNT
26 GAUGE
Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
30/1 250 270
40/1 195 225
32/1 240 260
42/1 180 200
34/1 230 250
44/1 175 190
36/1 220 240
46/1 170 185
38/1 210 230
48/1 165 180
40/1 190 220
50/1 160 175
YARN
COUNT
28 GAUGE YARN
COUNT
22 GAUGE
Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
40/1 200 230
26/1 260 280
60/1 165 180
28/1 250 270
70/1 135 150
30/1 240 260
80/1 115 130
32/1 230 250
34/1 220 240
34/1 170 180
40/1 150 160
YARN
COUNT
16 GAUGE
Finish G.S.M.
MINIMUM MAXIMUM
18/1 280 290
20/1 270 280
22/1 250 260
Page | 61
USE 24 GAUGE MACHINE
YARN
COUNT
SINGLE P.K
YARN
COUNT
DOUBLE P.K
Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
24/1 200 210
24/1 210 220
26/1 190 200
26/1 200 210
28/1 180 190
28/1 190 200
30/1 170 180
30/1 180 190
32/1 160 170
32/1 170 180
34/1 150 160
34/1 160 170
Half Feeder Lycra S/J (24 GAUGE)
YARN
COUNT
With 20/D Lycra Lycra Use
(%)
YARN
COUNT
With 40/D Lycra
Lycra Use (%) Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
34/1 150 160 2.00 - 2.10
30/1 190 210 3.40 - 3.80
36/1 145 155 2.10 - 2.20
32/1 180 190 3.80 - 4.00
38/1 140 150 2.15 - 2.30
34/1 170 180 4.00 - 4.20
40/1 135 145 2.30 - 2.40
36/1 160 170 4.20 - 4.40
38/1 155 165 4.50 - 4.70
40/1 150 160 4.60 - 4.80
YARN
COUNT
SINGLE LACOST YARN
COUNT
DOUBLE LACOST
Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
24/1 210 230
24/1 220 240
26/1 200 220
26/1 210 230
28/1 190 200
28/1 200 210
30/1 180 190
30/1 190 200
32/1 170 180
32/1 180 190
34/1 160 170
34/1 170 190
Page | 62
Full Feeder Lycra S/J (24 GAUGE)
YARN
COUNT
With 20/D Lycra Lycra Use
(%)
YARN
COUNT
With 40/D Lycra
Lycra Use (%) Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
30/1 200 210
3.00 -
3.50 30/1 240 250
6.50 - 7.00
32/1 190 200
3.50 -
3.75 32/1 230 240
7.00 - 7.25
34/1 180 190 3.75 -
4.00 34/1 220 230
7.25 - 7.50
36/1 170 180
4.00 -
4.25 36/1 210 220
7.50 - 7.75
38/1 165 175 4.25 - 4.50
38/1 200 210 7.75 - 8.25
40/1 150 160 4.50 - 5.00
40/1 180 200 8.25 - 9.00
H/Feeder Lycra S/J (28 GG) H/Feeder Lycra S/J (24 GG)
YARN
COUNT
With 20/D Lycra Lycra
Use (%)
YARN
COUNT
With 70/D Lycra
Lycra Use (%) Finish G.S.M.
Finish G.S.M.
MINIMUM MAXIMUM
MINIMUM MAXIMUM
44/1 120 130 2.50 -
2.60 28/1 220 230
5.80 - 6.00
50/1 105 110
2.85 -
3.00 26/1 230 240
5.60 - 5.80
Full Feeder Lycra S/J (28 GG)
YARN COUNT
With 20/D Lycra
Lycra Use (%) Finish G.S.M.
MINIMUM MAXIMUM
40/1 170 180 4.50 - 5.00
45/1 160 170 5.00 - 5.50
50/1 150 160 5.50 - 6.00
55/1 130 140 6.00 - 6.50
60/1 120 130 6.50 - 7.00
Page | 63
10.21. Merchandiser Should Be Known Different Thread Consumption:-
THREAD CONSUMPTION:
Stitch
class
Stitch
description
Thread
consumption
amount
% of
needle
QTY
amoun
t
% of
needle
thread
amoun
t
% of
bobbi
n
thread
amoun
t
% of
lopper
thread
amoun
t
M/C name
Per
inch
Per
cm
101 Single thread
chain st(Basic) 4 4 1 100% - -
1 needle chain
stitch m/c
103
Blind stitch 4 4 1 100% - -
1 needle chain
stitch m/c
104
Blind stitch 4 4 1 100% - -
1 needle chain
stitch m/c
301 Lock stitch 2.5 2.5 1 50% 50% - 1 needle lock
stitch m/c
304 Lock stitch 7 7 1 50% 50% - Zigzag lock
stitch m/c
315 Lock stitch 14 14 1 50% 50% - Zigzag lock
stitch m/c
401 Multi or double
thread chain st. 5.5 5.5 1 25% - 75%
1 needle multi
thread chain st
40 Multi or double
thread chain st. 5.5 5.5 1 25% - 75%
2 needle multi
thread chain st
406
Bottom
covering multi
thread chain st
18 18 2 30% - 70%
2 needle
bottom
covering multi
thread chain
st.
503 Over edge chain
stitch 12 12 1 55% - 45% 1 needle 2
thread over
Page | 64
lock m/c
504 Over edge chain
stitch 14 14 1 20% - 80%
3 thread over
lock m/c
512 Over edge chain
stitch 18 18 2 25% - 75%
4 thread over
lock (mock
safety st)
514 Over edge chain
stitch 18.5 18.5 2 20% - 80%
4 thread over
lock m/c
515 Over edge chain
stitch (401+503) 17.5 17.5 2 25% - 75%
4 thread over
lock safety st
m/c
516 Over edge chain
stitch (401+504) 19.5 19.5 2 20% - 80%
5 thread over
lock safety st
m/c
602 Covering chain
stitch 25 25 2 20% - 80%
4 thread top &
bottom, 2
needle top &
bottom
covering flat
lock m/c
605 Covering chain
stitch 28 28 3 30% - 70%
5 thread top &
bottom , 3
needle top &
bottom, flat
lock m/c
607 Covering chain
stitch 32 32 4 35% - 65%
6 thread top &
bottom,
4needle top &
bottom, flat
lock m/c
Page | 65
10.22. MACHINE WISE SEWING THREAD CONSUMPTION/INCH:
1.plain m/c 1 needle 2.5 inch
2.plain m/c 2 needle 5 inch
3.over lock 3 thread 13.25 inch
4. over lock 4thread 16.75inch
5.over lock 5 thread 18.75inch
6.flat lock 3 thread 16.75inch
7.flat lock 5thread 22.25inch
8.bar tack stitching Per operation Generally 7 inch
10.23. SPECIMEN SEWING THREAD CONSUMPTION:
Approx sewing thread consumption of different items
No. Product name consumption
01 Basic t- shirt 125meter
02 Basic polo shirt 175
03 Tank top 50meter
04 Fleece/Sherpa jacket 250meter
05 Kids/girls dresses 300-450meter
06 basic long sleeve woven shirt 150meter
07 Basic short sleeve woven shirt 125 meter
08 basic long trouser/pant 350meter
10.24. MERCHANDISER SHOULD BE KNOWN SOME IMPORTANT
ABBREVIATION FOR MERCHANDISING DPT.
Some important abbreviation for merchandising dpt. & RMG sector are as below:
RMG: Readymade Garments.
T&P Time Action Plain
AM: Assistant Merchandiser.
M: Merchandiser.
SM: Senior Merchandiser.
MM: Merchandise Manager.
RPM: Rotation per mint.
FCR: Cost and Freight.
C&F: Clearing and Forwarding.
CIF: Cost and Freight
Page | 66
LC: Latter of Credit.
AQL: Acceptable Quality Label.
QC: Quality Controller.
CM/OM: Country Manger/Office
Manager.
CM: Cost of Manufacturing.
CMT: Cost of Manufacturing with
Trims.
GOH: Garments on Hanger.
FPC: Flat Packing container
FOB: Free on Board.
EPB: Export Processing Bureau.
Container.
ETA: Expected Time of Arrival.
ETD: Expected Time of Departure.
GSP: Generalized system of
preference.
PSI: Pre shipment Inspection.
IC: Inspection certificate.
DDP: Delivery duty paid.
HAWB: House Airway Bill.
MAWB: Master Airway Bill.
BL: Bill of Lading.
POD: Port of Delivery.
DDU: Delivery duty unpaid.
FEU: Forty feet equivalent.
TEU: Twenty feet equivalent.
LCL: Lace container load/light.
POL: Port of Loading.
MOS: Margin of Safety.
IE: Industrial Engineer.
SPI: Stitch per inch.
FCL: Full container Load.
CO: Country of origin.
M.V: Mother Vessel.
10.25. CBM Calculation:
CBM means cubic meter.
Process:
Length (cm)* Width (cm) * Height (cm) * quantity of cartoon
10.26. Price Quotations.
The pricing of products varies for different types of shipment. The merchandisers always
have to be sure about the shipment system while he/she is making the price quotation. There
are some processes for fixation price which are shown below.
FOB (free on board)
Exporter does not bear the cost of freight of ship or air.
It is buyer who himself bear the freight.
C & F (cost & freight)
Free on board + freight = c & f.
In this case ship or air freight is carried by the exporter while quoting price.
This price a bit higher than FOB.
CIF (cost, insurance & freight)
C&F + insurance = CIF.
Page | 67
In this case in addition to the bearing of freight, the cost of insurance is also borne by
the exporter
CM (cost of making / manufacturing)
Manufacturing or exporter will get only making charge of that garment
Fabric, trimming and other materials is supplied by the buyer
CMT (cost of manufacturing and trimming)
Manufacture or exporter will get the making charge and at the same time will get
the trimming cost.
Fabric is supplied by the buyer.
An example is given below for pricing of one dozen full sleeve shirt production.
Fabric: 30yds × $ 0.95 = US $ 28.50
Accessories: cost/dz × = US $ 6.00 (1 piece all time $ .15)
Cm / dz = US $ 10.00
Sub total = US $34.50
Transport cost from factory to sea or air port (.5%) = US $ 0.25
Clearing and fording cost (2%) = US $ 0.90
Over head cost (.5%) = US$ 0.20
Net cost price = US$ 45.85
Profit (10%) = US $ 4.50
Net FOB price = US$ 50.90
Freight (4%) = US$ 2.00
Net C & F price = US$ 52.90
Insurance (1%) = us $ 0.52
Net CIF price = US $ 53.42
10.27. Costing of garments product.
Generally two types of costing are maintainer in apparel merchandising they are shown
below.
Costing Function of a Garment:
Pre cost:-
1. It is an estimate made before the garment is adopted in to the line
2. Fabric, trim and labor costs for each garment is calculated
3. The merchandiser / designer usually keep a record of all materials costs on a work
sheet.
Page | 68
4. Then the costing department can roughly estimate the cost and price structure.
(Normally overhead cost is 30-40%)
Final costing:-
1. It is an exact calculation by the costing or import department
2. Using actual figures for fabric, accessories and labour cost
3. Costing department uses-
a) Merchandiser work sheet
b) A proto type garment
c) Production pattern
d) A detailed cost analysis is made for each garment the final cost is plotted
on a “cost sheet”.
e)
10.28. Costing of Garments (in FOB) Price.
Costing of a garment for example in a shirt:
1. Fabric costing
2. Garment accessories:-
1. Button
2. Interlining
3. Label
4. Thread
5. Collar bone
6. Hang tag/ price tag
Finishing accessories:
1. Poly bag
2. Plastic clip
3. Gum Tape
4. Neck board
5. Tag pin
6. Sticker
7. Butterfly
8. Collar insert
9. Back board
10. Neck insert
11. Scotch Tape
12. PP belt
13. Carton
14. Poly blister
15. Blister sticker
4. Labor charge
5. Washing charge (If it is garment wash)
6. Commercial and transportation cos
Page | 69
10.29. Cost sheet preparation:
Style : USS11-60 Style : USS11-14
Gauge : 12GG Gauge : 7 GG
Yarn : 50/50 Acrylic /Cotton Yarn : 100 Cotton
Weight : 8.5 Lbs/Dzn Weight : 14 Lbs/Dzn
SL Description Amount SL Description Amount
1 Yarn (8.5*2.6)+10% $ 24.31 1 Yarn (14*2.20)+10% $ 33.88
2 Trims $ 3.50 2 Trims $ 3.50
3 Button $ 2.50 3 Button $ 2.50
4 Elastic $ 1.50 4 Elastic $ 1.50
5 CM $ 32.00 5 CM $ 24.00
6 Total $ 62.31 6 Total $ 65.38
7 Buying Comm. 5% $ 3.12 7 Buying Comm. 5% $ 3.27
8 Total $ 65.43 8 Total $ 68.65
FOB $ 5.45 FOB $ 5.72
Offer Price $ 5.60 Offer Price $ 5.85
10.30. Cost Sheet Analysis.
Materials: total amount of material × @ ($ 1) / yd = total price.
Trimming: button (BTN), thread (THD), interlining(int), level & packing.
Production pattern making, grading, marking, spreading and cutting.
Assembly and finishing: calculated the average time of operations.
Over head cost: salary, rent, utilities > (30- 40%).
Freight: air freight / sea freight.
Quota change.
Page | 70
10.31. Consumption of Shirt, T-shirt, Trouser.
There are two type of fabric consumption:-
o Marker planning system (actual)
o Mathematical system / estimation
Basic principle of marker planning:-
Pattern set (small, medium, large & XL)
Place it on marker paper
Measure marker paper to length wise
Find a consumption/dz from the calculation.
Basic principle of mathematical system:-
Rough estimation
Consumption calculation by following a sample or size sheet
Measuring the area of each part for each piece of garment
Find consumption /dz from the calculation
Example:-
For a long sleeve shirt:-
Spec. sheet:-
Collar = 16"
Chest = 48"
Center back length = 31"
Sleeve length = 34.5"
Drop shoulder = 21"(yoke)
Arm hole depth (1/2) = 10.5"
Cuff = 9"
Pocket = 6" × 5.5"
Yoke is all time = 4"
[Area means- L× W]
Page | 71
Back part
Formula:-
(Center back length + allowance) × (½ chest + allowance) / 36
= {L} x {W}
44
= (31" + 2") × (24" + 2" ) /36
44
= 0.541yds
Yoke:
Formula:-
(Yoke length + allowance) × (yoke width + allowance) / 36
44
= (21" + 4") × (4"+ 1") / 36
44
= 0.079 ydz
Front part:
Formula:-
= Body length + allowance) × (¼ chest + allowance) × 2 /36
44
= [{31"- 1 ¼" + 1"} ×{ 12" + 2 ½" }] 2" /36
44
=0.562 yds
Sleeve:
Formula:-
= (Sleeve length + allowance) × (arm hole depth full + allowance) ×2 / 36
44
Page | 72
= {sleeve length – (½ drop shoulder + ½") × (arm hole depth + allowance)} ×2 /36
44
= [{34 ½" - 11"} +1"] × {21" +1"} × 2 /36
44
= 0.68yds
Cuff:
Formula:-
= (Cuff length + allowance) × (cuff width + allowance) ×2 / 36
44
= (9" + 3") × (2 ½" + ½”) ×2 /36
44
= 0.05yds
Collar:
Formula:-
= (Collar length + allowance)× (collar width + allowance) × 2 /36
44
= collar length + allowance) × (collar width + allowance) ×4 / 36
44
= 16" + 5") × (2" +1") × 4/36
44
= 0.159yds
Page | 73
Pocket:
Formula:-
=Pocket length + allowance) × (pocket width +allowance) / 36
44
= (6" +2") (5½" +1") /36
44
= 0.032yds
Total consumption for one garment
= 0.541+0.079+0.562+0.68+0.05+0.159+0.032
= 2.100 yds/ per garment
Per dz = 2.100 ×12
= 25.20/dz (ypd) + 5%
= {25.20 ×5 / 100} + 25.20
= 1.26 + 25.20
=0.46
Consumption Calculation for Trouser:-
Measurements:-
Out seam = 42"
In seam = 32"
Waist = 36"
Hip = 40"
Bottom = 20"
Find out fabric consumption /dz if fabric width = 58"
Page | 74
Formula:
Out seam × thigh × 4 / 36"
57"
= (42" + 2" + 2") × (Hip/4 + 1.5" + 1.5" ) × 4 / 36"
57"
= 46" × (40"/4 + 3") × 4 / 36"
57"
= 46" × 13" × 4 / 36"
57"
= 1.165 yd / per trouser
=1.165 yd / per trouser + zipper fly (2) + pocket facing (4) + back pocket bone + belt loop
= 1.165 × 5% (for regular trouser) {= 0.058}
=1.165 + 0.058 = 1.21
=1.21 + 5%
=1.21 +0.060 = 1.270 × 12 (per dz)
=15.24 ypd
Knit Fabric
For, T-shirt {(s/j) 30/1 combed yarn}
Measurement:-
Length = 70 cm
½ chest = 60 cm / dia
Sleeve length = 25 cm
Arm hole width = 40 cm
GSM = 145
Find out consumption / dz in kg
Page | 75
Formula:
(Back length + sleeve length) × ½ chest × 2 × GSM ×12
10000000
= {(70 +5) + (25 +5)} × 60 × 2 ×145 ×12 {B.L + S.L × chest × GSM×12}
10000000 100 100 1000
= 2.28 kg + 7%
= 2.28 kg +0.159
= 2.439 kg [neck and sleeve are made rib so add 0.10]
All time collar in rib = (350-400)
10.32. INTERLING CONCUMPTION:
Length x Width x 12
36x58”(Fabric Width)
10.33. TWILL TAPE CONCUMPTION:
Length x 12
36x2.54(For Inch)
10.34. BUTTON CONSUMPTION:
As per qty in one body
Here: 1G = 144pcs
1GG= 144x 12 = 1728 pcs
Plz count all time minmum 2 extra per body.
CARTON CONSUMPTION:
Length = 60cm 60cm
Width = 40cm CARTON 30cm
Height = 40c
Page | 76
2(L+W+Allounce 5cm) X (W+H+Allounce 2.5cm)
10000
= 2(60+40+5) *(40+40+2.5)
10000
= 17325
1000
= 1.7325 sqm
10.35. Consumption sheet preparation:
Yarn Consumption
Style: 66464L
Total Weight = 262
Body : 128gm *2 256gm
sleeve : 46gm *2 92gm
Neck : 54gm *1 54gm
Belt : 26gm *1 26gm
loop : 8gm *1 8gm
total 262gm 436gm
Body Sleeve
Black 50gm Black 28gm
Strip 78gm Stripe 18gm
consumption
Black (50+28)=78*2=(156+54+26+8)= 244
Stripe: (78+18)=96*2= 192
Page | 77
Total:436
Consumption:
Body color = 56%
Stripe color= 44%
Total=100%
10.36. Poly Consumption:
Style Unit L with W H Squ /m $/pcs $/dz Flap Print Total
add $/pcs $/dz
7-Apr-10
I448911 7 ply 39 29 15 0.6789 $0.43
I448909 7 ply 42 29 15 0.7068 $0.45
I439685 7 ply 39 29 15 0.6789 $0.43
I439688 7 ply 39 29 15 0.6789 $0.43
13-May-10
I448911 7 ply 46 36 15 0.9309 $0.60
I448909 7 ply 40 30 15 0.7125 $0.46
I439688 7 ply 42 32 20 0.8611 $0.55
10.37. Poly Costing:
Unit L with
felted W Thickness $/pcs $/dz Flap Print Total
add $/pcs $/dz
PE
poly 14.17 9.84 8
67.20 0.18 0.04 0.06 0.28
PE
poly 15.75 11.81 8
50.40 0.24 0.03 0.06 0.33
Page | 78
PE
poly 21.00 19.00 10
18.80 0.64 0.03 0.06 0.73
PE
poly 14.00 11.00 10
48.70 0.25 0.00 0.06 0.31
10.38. Inventory of accessories:
BUYER : WAIKIKI
STYLE NO: PNT, ACTIONS
P.O NO : 140410
ORDER QTY: 1020 PCS
DATE:
23/06/2010
SL
NAME OF
ACCESSORIES
ORDER
QTY
REQUIRD
QTY
1 Main Label 1020 1071
2 Size Label S 170 178.5
M 238 249.9
L 289 303.45
XL 221 232.05
XXL 102 107.1
3 Care Label 1020 1071
4 Adjustable Elastic band 1000yds 1050
5 Waikiki Barcode Hang Tag 1020 1071
6 Card board Hangtag 1020 1071
7 Hanger (44cm) 1020 1071
8 Transparent Button 20 1020 1071
9
Plastic Button Seems like
metal Button 26 1020 1071
Page | 79
10
Plastic Button Seems like
metal Button 24 1020 1071
11 Size Ring 1020 1071
12 Poly 1020 1071
13 Carton 85 89.25
14 Gum tape 30 31.5
15 Scotch Tape (Dz) 1 1.05
16 Sewing Thread 20 21
17
Zipper (Bislon 5) )& Metal
Zip T4.5 & Slider DA 0 0
S-59cm 170 178.5
M-61cm 238 249.9
L-62cm 289 303.45
XL-64cm 221 232.05
XXL-66cm 102 107.1
10.39. Preparation of Packing List after Final Inspection:
STARLET APPARELS LTD.
PACKING LIST
DATE : 13.05.20011
BUYER : DOKUMA OLCO TABLOSU
STYLE : PNT,ACTIONS
BRAND : WAIKIKI
ORDER : 1512 PCS
Page | 80
QTY
SHIPMENT
QTY : 1512 PCS
CTN QTY : 63
ASSORT COLOUR ASSORTED SIZE
COMBO/SIZE S M L XL TTL PCS CTN NO
TTL
CTN
QTY
TOTAL
PCS
BLACK WHITE
CHCK-764 1 2 2 1 6
1-62 62
372
T-WUIB151
BLACK/WHITE VAR 1 2 2 1 6 372
G99-BLACK 1 2 2 1 6 372
C8684 GREY 1 2 2 1 6 372
TOTAL= 4 8 8 4 24 1-62 62 1488
UNASSORTED CARTON 1 PCS
COMBO/SIZE S M L XL TTL PCS CTN NO
TTL
CTN
QTY
TOTAL
PCS
BLACK WHITE
CHCK-764 9 5 0 0 14
63 1
14
T-WUIB151
BLACK/WHITE VAR 1 0 0 1 2 2
G99-BLACK 0 0 0 0 0 0
C8684 GREY 1 4 0 3 8 8
TOTAL= 11 9 0 4 24 63 1 24
NET WT : 25.00 KGS
GR. WT : 29.00 KGS
CTN MEAS : 96 X 60 X 48 CM
Page | 81
10.40. Shipping Mark:
MAIN MARK
CUSTOMER # DOKUMA OLCO TABLOSU
LABEL # DIGITAL
PRICE TAG # WITH PRICE TAG
ILANCO PO. # 140410
STYLE # PNT, ACTIONS
DESCRIPTION # 100% COTTON, 2%SPANDEX
COLOUR S/P M/M L/G XL/TG TOTAL
GRAPE 1 2 2 1 6
IVORY 1 2 2 1 6
BLACK WHATE 1 2 2 1 6
TOTAL: 18 PCS
SIDE MARK
NET WEIGHT # KGS
GROSS WEIGHT # KGS
CARTON NO # OF
CARTON MEAS # 58 X 34 X 50 CM
MADE IN BANGLADESH
10.41. SOME IMPORTANT PRINTING & EMBROIDERY:
Kinds of Printing
Pigment printing
Rubber printing
High density printing
Discharge printing
Plasticol printing
Metallic printing
Glitter printing
Puff printing
Foil printing
Printing Fault
Fabric defect
Missing
Wrong
Missing elasticity
Wrong size
Color wrong
Page | 82
Migration problem
Cover up defect
Sticky
Uneven
Air bubbles
Air hole
Shade variation etc
10.42. Embroidery Section
Types of Embroidery Stitch
Satin
Tatami
Run stitch
Zigzag stitch
Steam stitch
Motif stitch
Programmed stitch
Coil stitch
E stitch
Pricing Factors of Embroidery
The pricing of the embroidery depends on
the following factors such as –
Unit
Design size
Interlining
Adhesive
Spray gum
Bobbin thread
Embroidery thread
Needle
Appliqué
Embroidery Fault
Broken stitch
Not properly sealed
Wrong tension
Skipped stitch
Missing
Wrong
Wrongly placed
Not properly attached
Backing not removed
Stain
10.43. PI Sheet and its Items.
Performa invoice is a statement for an invoice that will be settled out in the future depending
on the goods arrived. In foreign trade transaction a proforma invoice is a document that‟s
stands a commitment from the seller to reserve some goods to be sold to a certain person the
buyer. The buyer places an order and if the seller arranges it extends a proforma invoice
when the buyer receives this invoice and agrees to all the terms specified in it the goods are
sent and the proforma is replaced by a commercial invoice.
Page | 83
The items are included in this sheet given below…
Top part:
01. Name and address of seller.
02. Invoice number and date.
03. Buyer name and address.
10.44. Agenda and Minutes Writing Procedure.
Based on the comparative statement few people make a boarded and arrange a meeting
to discuss about all relevant topics about suppliers and price quotation and make agenda.
All discussion should be written in papers and take signature of every members of the
board.
10.45. Steps of Negotiation between Merchandiser & Supplier.
The collect information of suppliers from data bank of suppliers.
Asking for samples at last from five suppliers.
Approval of samples and conformation.
Asking for price from at least 3 suppliers.
To prepare comparative statement /C S.
To invite suppliers for price negotiation.
To conform price to supplier through email.
To Purchase Order (P.O) to supplier.
Receiving P.I from supplier.
To open B/B L/C
Approve.okn
10.46. Negotiation Process.
After getting the proper sourcing the material/store room management department is arranged
a meeting to the supplier that‟s call negotiation process meeting. In this meeting talk to the
supplier some factors this are very important. Given below some factors name-
01. Lead time.
02. Delivery in time.
03. Quantity.
04. Shipment date.
Page | 84
10.47. Price Negotiation Procedure with Different Suppliers:
Arrange meeting with different suppliers.
Collect price different suppliers
Select some price
Argument with selected suppliers.
Win Win situation
Fixed price
Order to supplier
10.48. Items Included in P.O:
The Purchase Order is provided to the vendor as a record of the Purchase. A sample
Purchase Order Sheet indicates the followings:-
Purchase Order Number:
The number is assigned to the purchase order. This is used to identify a definite
order and for departmental record keeping.
Vendor‟s Name and Address:
The complete name and address of the individual or company which manufacture the
merchandise.
Ship To:
Receiving Department address.
Deliver To:
The complete name and location of the individual who requested the ordered goods.
Page | 85
Date:
The date at which the purchase order was received and also the date at which the
order will have to be shipped
Payment Terms:
Payment terms defined by Purchasing Department of the buyer.
Ship Via:
Shipping instructions entered by Purchasing Department.
F.O.B:
Shipping terms defined by Purchasing Department.
Freight Terms:
Freight terms defined by Purchasing Department.
3.2.10. P. O. Line No.
The sequential line number which corresponds with the line on the requisition (i.e.,
the first item would be line 1; the second would be line 2, etc.)
Quantity:
The quantity of the item being purchased.
UOP (Unit of Purchase):
The packaging of the item to be purchased (i.e., each, box, package, poly, dozen,
carton etc.)
Unit Price:
The unit price of the item ordered.
Extended Price/ Total Price:
The total quantity of the item multiplied by its unit price.
Description:
The complete description of the item ordered in detail, i.e. color, size ratio, critical
designs, buttons and other trims, printings, sewing thread used etc.
Total:
The total amount of all items on the purchase order.
Page | 86
During partial shipment, color-wise and size-wise quantity to be shipped is
mentioned.
For Questions Concerning This Purchase Order
The buyer's name and telephone number to contact for questions concerning this
purchase order.
10.49. Those items are included in P.O. This are-
Order quantity.
Product description.
Size breakdown.
Supplier bank address.
Buyer details.
Country of origin.
Payment terms.
Carton marks.
Fabric construction.
Care label instruction.
Port of loading.
10.50. P/I Collection Procedure from Supplies and Checking of P.I:
After getting P.O from garment industry than supplier issue a P.I to merchandiser. This
P.I sends by e-mail or DSL to the merchandiser. As like this way collect P.I from
supplier.
The checking procedure of P.I
10.51. PI Sheet and Its Items:
In foreign trade transaction, a reformat invoice is a documents that states a commitment from
the seller to reserve some goods to be sold to a certain person, the buyer. the buyer places an
Page | 87
order and if the seller agrees, it extend a reformat invoice and agrees to all the terms specified
in it, the goods are send and the reformat is replaced by a commercial invoice.
What are the items will include in this sheet are-
Top part:
Name and address of seller
Invoice number and date.
Buyer name and address.
Body/middle part:
Product description.
Unit price.
Total price.
Bottom part:
Shipment date.
Shipment terms FOB or C&F.
Country of origin.
Terms of payment, at sight or 120 days.
Others special terms.
10.52. PI Request to Yarn Supplier.
Dear X,
Please send urgently a P/I Named by "Ananta garment ltd. " as earlier address .
Detail's are below:
100% Cotton: 7900.LBS
Yarn type: Carded
Yarn Count: 30/1
Please make and send to Ananta garment ltd by fax or attachment also please send A C. C
and please give price as soon as possible.
Thanks with best regard,
Y STARLET Textile LTD.
134, Kabi Jashim Udden Road,
Pagar, Tongi, Gazipur
Page | 88
Dyeing Order.
YARN : 100% COTTON, 2% SPANDEX
SL Colour Name Approved Shade Quantity
1 Grape 20368-07 (B) / 12 JAN 2011 401 LBS
2 Black 20368-11 (B) / 12 JAN2011 2894 LBS
3 Ivory 20368-09 (A) / 12 JAN 2011 1241 LBS
TOTAL 4536 LBS
YARN: 98% COTTON MELANGE 2/32
SL Colour Name Approved Shade Quantity
1 Charcoal Melange LD-617-01 (B) / 3rd
March 2011 1568 LBS
TOTAL 1568 LBS
YARN: 97% COTTON CANVAS1/5.5, 2%SPANDEX
SL Colour Name Approved Shade Quantity
1 Black White CHCK-
764
LD- 870-06 (A) / 31 March 2011 1423 LBS
2 Black White CHCK-
764
LD–870–05 (A) / 31 March 2011 178 LBS
3 Lila AS PER ORIGINAL SWATCH 102 LBS
4 Grey LD – 870-01 (A) / 31 March 2011 68 LBS
5 White Blue AS PER ORIGINAL SWATCH 407 LBS
6 Magenta AS PER ORIGINAL SWATCH 633 LBS
7 Dark Grape AS PER ORIGINAL SWATCH 102 LBS
8 Ivory AS PER ORIGINAL SWATCH 355 LBS
9 Charcoal LD – 870-03 (B) / 31 March 2011 201 LBS
TOTAL 3469 LBS
Page | 89
10.53. Daily Production Report from the Supplier & Monitoring.
Daily production report is very important while production going on without daily
production report the improvement of the working can‟t measurement on the basis of this
report production is calculated how much time will require to complete the order and follow
according to the plan the progress of the present status. Given below a daily production report
chart for better understanding.
10.54. Preparation of Shipping Sample and Sending To Buyer.
Shipment Sample:
This sample contains all size & all colors & style were exported to Buyer. These samples are
reference, the manufacture with him for his record. In needed for future reference, if any
claim comes from Buyer.
When the shipping sample is sending to the buyer it should me very presentable and
attractive so the buyer is addicted at a first glance.
10.55. Investigation to Third Party like SGS, ITS for Final Inspection.
In order to check the quality of the apparel third party inspection also important. Before going
to the third party inspection at first stage buyer is inspect the quality of the apparel by their
own quality controller if, the inform the buyer this apparel has not fulfill to the quality of the
expectation levels then the supplier and the buyer will agree to go the third party inspection
team to inspect the quality the third party is invite like SGS, IT etc
10.56. Trim Card Preparation.
What kinds of fabric and accessories are required for making garments according to buyer
tech pack? All kinds of fabric and accessories care label color, shade, yarn, count, button,
zipper etc is submitted to card that‟s call trim card. Without approval of trim card production
can‟t run. For better understanding in the appendix I have submitted a trim card for better
understanding.
10.57. Price Negotiation Meeting.
Price negotiation meeting is very crucial factors for the company. Mainly price depend on
factory to factory while price negotiation meeting with buyer discuss about the price
selection. The factory is given a price list to the buyer price without this price we can‟t make
this product and everything is discussed about the factory owner. After submission of the
price lists the buyer think that it‟s ok then they sign to continue the business.
Page | 90
10.58. Procedure of Receiving for Accessories.
BUYER :WAIKIKI
STYLE NO: PNT,ACTIONS
P.O NO : 140410
ORDER QTY: 1020 PCS DATE: 23/06/2010
SL
NAME OF
ACCESSORIES
ORDER
QTY
REQUIRD
QTY
RCVD
QTY
SHORT
QTY REMARKS
1 Main Label 1020 1071 1080 Ok
2
Size Label
S 170 178.5 178.5 Ok
M 238 249.9 249.9 Ok
L 289 303.45 330 Ok
XL 221 232.05 290 Ok
XXL 102 107.1 165 Ok
3 Care Label 1020 1071 1060 Ok
4
Adjustable Elastic
band 1000yds 1050 1030 Ok
5
Waikiki Barcode
Hang Tag
1020 1071 1060 Ok
Card board
Hangtag 1020 1071 1060 Ok
6 Hanger (44cm) 1020 1071 1050.6 Ok
7 Size Ring 1020 1071 1110 Ok
8
Transparent Button
20 1020 1071 1110 Ok
9
Plastic Button
Seems like metal
Button 26 1020 1071 1110 Ok
Page | 91
10
Plastic Button
Seems like metal
Button 24 1020 1071 1110 Ok
11 Poly 1020 1071 1071 Ok
12 Carton 85 89.25 89.25
13 Gume tape 30 31.5 30.9 Ok
14 Scotch Tape (Dz) 1 1.05 1.05 Ok
15 Sewing Thread 20 21 20.6 Ok
16
Zipper (Bislon 5)& Metal Zip
T4.5 & Slider DA 0 0 Ok
S-59cm 170 178.5 178.5 Ok
M-61cm 238 249.9 249.9 Ok
L-62cm 289 303.45 300 Ok
XL-64cm 221 232.05 275 Ok
XXL-66cm 102 107.1 150 Ok
10.59. Buyer Wise Purchase Order.
Order Style Summary
Buyer Style Yarn Descripti
on
Ord
er
Qty
Ship.
Date
Remar
ks
H&M 1253 95%Cotton,5%Canvas KEY
WOVEN
TROUSE
RS
1500
0
15-
05201
1
H&M 1264 95%Cotton,5%Canvas KEY
WOVEN
TROUSE
RS
1500
0
15-05-
2011
H&M 1278 95%Cotton,5%Canvas KEY
WOVEN
1296
0
20-05-
2011
Page | 92
TROUSE
RS
GAP 12832 100%Cotton,5%Canvas,2%
laycra
CARGOU
PANT 7920
22-05-
2011
GAP 12956 95%Cotton,5%Canvas CARGOU
PANT 7920
28-05-
2011
GAP 13049 100%Cotton,5%Canvas,2%
laycra
CARGOU
PANT 7920
03-06-
2011
NEWLO
OK
97452 95%Cotton,5%Spandex BASIC
WOVEN
TROUSE
RS 6840
10-06-
2011
NEWLO
OK
987235 100%Cotton,5%Canvas,2%
laycra
BASIC
WOVEN
TROUSE
RS
1008
0
02-03-
2011
JM&A W10B625
8B
100%Cotton,5%Canvas CARGOU
PANT 2940
08-03-
2011
JM&A W10B625
9B
100%Cotton,2%Spandex CARGOU
PANT 3310
20-03-
2011
VANTA
GE
102370 100%Cotton,2%Spandex KEY
WOVEN
TROUSE
RS
1262
5
31-
03201
1
VANTA
GE
102420 100%Cotton,2%Spandex KEY
WOVEN
TROUSE
RS
1412
5
10-04-
2011
TIMEA 102720 100%Cotton,5%Spandex BASIC
WOVEN
TROUSE
RS
2925
0
22-04-
2011
TIMEA 102877 100%Cotton,5%Spandex BASIC
WOVEN
TROUSE
RS
2850
0
28-04-
2011
Page | 93
TIMEA 102880 100%Cotton,5%Spandex BASIC
WOVEN
TROUSE
RS
6525
0
02-05-
2011
10.60. Production flow of Sales & distribution.
Order
SMS Sample
Open
Costing
Only price
Production book receive
Lab dip approval
Forecast
Greige book + production
Final order
Booking yarn
Fabric
Trims / accessories
Space booking
Sealer sample approval
AW approval
Bulk fabric approval with
Test report
Special wash / over dye
Cutting
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Sewing thread/
Trims in house
Size set
Embellishment
(Print/ Emb/Appliqué)
Sewing
Wash
Finishing
Final Inspection
Ex- factory
Shipment
Air Sea
10.61. Future Business Plan Writing.
After completing a session of business, all merchandiser arrange a meeting with DGM to
share all information about previous business and future business plan. They also find out
lacking occurred previously and find out solution to overcome those lacking and get a
profitable business in future, in future business plan merchandiser includes following matters-
Brief merchandising scenario-
Detail information about business made in those session and also abut clear representation
of market, own position, suppliers, buyers, share, growth etc.
Comparison between target and actual profit come after business of a session and also
information about problem take place during the previous season.
Recommendation for future-
Detail information about the action to improve business in next session, solution for
previously occurred problems, how to eradicate all deficient, any other necessary steps
need to be taken.
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11. MERCHANDISER SHOULD BE KNOWN DIFFERENT L/C.
11.1. Application Procedure to Bank for Back to Back L/C Opening.
Which L/C is issued against master L/C is called back to back L/C. Back to back L/C is a
letter of credit issued for the account of a buyer who is already holding L/C in his favor. The
back to back L/C is issued in favor of the supplier to import raw materials required to
produce the item for export as stipulated in the credit being held by the buyer.
There are two types of back to back L/C such as-
Local back to back L/C
Foreign back to back L/C
Note: 60-65% amount of the master L/C can be back to back to L/C not more than 65% of the
total amount.
Aug20,2010
To
The Manager(Import)
STARLET TEXTILE LTD.
Gazipur, Dhaka
Bangladesh
Ref: Account name …. Holding account no… with your Branch.
Sub: Request for Opening a Back to Back L/C against Export L/C Number…..Received
by Buyer.
Dear Sir,
We would request to you please open back to back L/C for US$ against above mention to
enable us to import fabric to execute the stipulated in the said master L/C.
You are here by authorized to keep the aforesaid original master L/C…..to cove the finance
involved in the opening back to back L/C.
Thanks
Name: X
Signature:
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11.2. Checking Master L/C Related with Terms and Condition Maintained In
Master L/C.
When we will check master L/C the check list must be included the following terms and
conditions…
01. Types of L/C
02. Issue date
03. Expire date.
04. Issuing bank details
05. Advising bank details
06. Seller name & address.
07. Total amount .currency of payments
08. Tolerance ( 2-5% plus or minus )
09. Port of loading
10. Description of goods
11. Shipping items ( FOB/ C&F )
12. List of documents received.
11.3.Collection of All Relevant Documents From Different Companies And
Organizations Like GSP, CO, etc:
GSP:
GSP means general system of preference. GSP is a certificate which save the purpose of
country of origin and get duty or reduced duty. This certificate issued by the export
promotion bureau. The are some rules applied to issue this certificate and this rules vary from
country to country. Some country insists that local components of the export products must
be more than certain percentage etc. This certificate accompany with export to enable the
importer claims duty concession from his local customs authority. It is a common demand of
customs authorities in EU.
CO:
The certificate of origin is a document that is required in certain nations. It is a sign statement
to the origin of the export items. Certificate of origin are usually signed through a
semiofficial organizations such as local chamber of commerce
11.4.Preparation of Commercial Invoice.
An invoice is a commercial documents issued by a seller to a buyer, indicating the products
the quantity and description of the goods the loading port and destination port the mode of
transportation the country of origin the price per unit and total cost of the goods with which
the seller has already provided by the buyer. An invoice indicates that payments is due form
the buyer to the seller according to payments terms the shipper gets the invoice ready at the
time the goods are being is prepared for shipping.
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11.5. Master L/C.
A documentary master L/C is an orderly payments security instruments offering high quality
of payment security to a business transaction for both parties the seller and buyer. The seller
will receive payments for his goods if he meets all conditions preserve by the letter of credit.
Without master L/C opening the order won‟t be conformed so its carry more value than other
documents in export and import business.
11.6.Forwarding Agents.
Persons, who are employed to collect, deliver and otherwise forward goods on behalf of
others are called forwarding agents. With the expansion of business, many manufactures use
forwarding agents who would relieve the manufacturers from the troubles of collecting goods
from suppliers and delivering goods to the destination
11.7. Documentation Submission Procedure to the Bank.
Local document:
01. Bill of exchange.
02. Invoice.
03. Packing list.
04. co/ delivery challan / truck challan
05. Good production certificate (BTMA) original copy.
06. GP2 challan
Foreign documents:
01. Bill of exchange.
02. Invoice.
03. Packing list.
04. Bill of lading.
05. GSP/CO/Inspection certificate.
11.8.Application Procedure for Cash Intensive from Bank.
July, 22 2010
The Manager
Prime Bank Ltd.
Uttara Branch
House # 1/A (1st floor), Road#13, Sector # 04
Ref: UD NO: / 2010.
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Sub: For claim 5% cash incentive against export of readymade garments.
Dear Sir,
As refer above of the subject we submitting herewith require papers to obtain 5% cash
incentive against export performance (local raw materials) as an extended by the government.
Please credit that sum as declared from “KHA” to our CD A/C NO ………..
Your kind perusal to this effect highly is appreciated.
Thanking you
Y LIMITED.
Mr.……..
Managing Director.
Enclosed.
01. Application along with export L/C. (As attached)
02. Claim amount as per from „KHA‟
03. Cost sheet attached.
04. Export and Import documents.
05. Packing List
06. Bill of Lading
07. Shipping Bill.
08. Bank Certificate.
09. Export L/C
10. Back to Back L/C.
11. Delivery Chillan
12. GP-2
13. Original Supplier Certificate.
14. BTMA.
11.9. Different Types of Containers.
Standard Containers: suitable for every normal cargo. Equipped with liner bags suitable for
bulk cargo e.g. malt.
Hard top Container: With removable solid steel roof (in case of 40 in two pieces). Specially
for heavy lifts, cargoes of excessive height, for loading from above. Loading from door end
tanks to removable door header.
Platforms Containers: Especially for heavy lifts and out of gauge cargoes. Not-container
sable cargo can be accommodated on several platforms lashed together.
Ventilated Containers: Especially for cargoes requiring ventilation. Open top Containers:
with removable tarpaulin especially for cargoes of excessive height, for loading from above.
Loading from door end tanks to removable door header.
Reefer Containers: Especially for cargoes requiring transport at a constant temperature
above or below freezing point. With built-in reefer unit, with a guaranteed.
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Flats Containers: Especially for heavy lifts and over width cargoes. Non-servable flats
positioned side by side.
Bulk Containers: Especially for loose/bulk cargoes e.g. malt.
11.10. Containers size.
20 feet steel Containers. (1960 to 2350 kg)
40 feet steel Containers.(3390 to 4190kg)
40 feet Aluminum Containers(2450 to 3050kg)
40 feet Aluminum /steel Containers(3950 to 4500kg)
12. INTRNATIONAL COMMERCIAL TERMS THAT ARE NEEDED A
MERCHANDISER.
"In commercial terms" is an abbreviation of International Commercial Terms, which were
first published in 1936 by the International Chamber of Commerce (ICC). Since that time
there have been six different revisions and updates to the in commercial terms. The Income
terms provide a common set of rules for the most often used international terms of trade.
The goal of the Income terms is to alleviate or reduce confusion over interpretations of
shipping terms, by outlining exactly who is obligated to take control of and/or insure goods at
a particular point in the shipping process. Further, the terms outline the obligations for the
clearance of the goods for export or import, and requirements on the packing of items.
The 13 terms listed under the in commercial terms are as follows:
12.1. EXW - Ex Works (named place)
The seller fulfills his obligation to deliver when he has made the goods available at his
premises (i.e. works, factory, and warehouse) to the buyer. The critical points worth noting
are:
Carriage to be arranged by the buyer.
Risk transfer from the seller to the buyer when the goods are at the disposal of the buyer.
Cost transfer from the seller to the buyer when the goods are at the disposal of the buyer.
12.2.FCA - Free Carrier (named place)
The seller satisfies his obligation to deliver when he has handed over the goods, cleared for
export, into the charge of the carrier named by the buyer at the named place or point. If the
buyer instructs the seller to deliver the cargo to a person e.g. a freight forwarder who is not a
"carrier", the seller is deemed to have completed his obligation to deliver the goods when
they are in that person‟s custody. The critical points worth noting are:
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Carriage to be arranged by the buyer or by the seller on the buyer‟s behalf.
Risk transfer from the seller to the buyer when the goods have been delivered to the
carrier at the named place.
Cost transfer from the seller to the buyer when the goods have been delivered to the
carrier at the named place.
12.3.FAS - Free Alongside Ship (named port of shipment)
The seller satisfies his obligation to deliver the goods when the goods are placed alongside
the vessel on the quay or lighters (barges) at the named port of shipment. The critical points
worth noting are:
Carriage to be arranged by the buyer.
Risk transfer from the seller to the buyer when the goods have been placed alongside the
ship.
Cost transfer from the seller to the buyer when the goods have been placed alongside the
ship
12.4.FOB - Freight on Board (named port of shipment)
Means the seller completes his obligation to deliver when the goods pass over the ship‟s rail
at the named port of shipment. The critical points worth noting are:
Carriage to be arranged by the buyer.
Risk transfer from the seller to the buyer when the goods pass the ship‟s rail.
Cost transfer from the seller to the buyer when the goods pass the ship‟s rail.
12.5.CNF - Cost & Freight (named port of destination)
The seller must pay the cost and freight necessary to bring the goods to the named port of
destination. The critical points worth noting are:
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods pass the ship‟s rail.
Cost transfer at the port of destination, buyer paying such costs as are not for the seller‟s
account under the contract of carriage.
12.6.CIF-Cost, Insurance & Freight (named port of destination)
The seller has the same obligations as under CFR, but must also procure marine insurance
against the buyer‟s risk of loss of, or damage to the goods during carriage. The critical points
worth noting are:
Carriage and Insurance to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods pass the ship‟s rail.
Cost transfer at the port of destination, buyer paying such costs as are not for the seller‟s
account under the contract of carriage.
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12.7.CPT - Carriage Paid To (named port of destination)
The seller pays the freight for carriage of the goods to the named port of destination. The risk
of loss of, or damage to the goods, as well as any additional costs due to the events occurring
after the time the goods have been delivered into the custody of the carrier, pass on from the
seller to the buyer once the goods are delivered into the custody of the carrier. In this context,
"carrier" means any person who, in a contract of carriage, undertakes to perform or to procure
the performance of carriage by rail, road, sea, air, inland waterway, or by a combination of
such modes. If subsequent carriers are used for the carriage to the agreed destination, the risk
passes when the goods have been delivered to the first carrier. The seller must clear the goods
for exports. The term applies to any mode of transport, including multi-modal transport. The
critical points worth noting are:
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods have been delivered to the
carrier.
Cost transfer at the port of destination, buyer paying such costs as are not for the seller‟s
account under the contract of carriage.
12.8.CIP - Carriage & Insurance Paid To (named port of destination)
The seller has the same obligations as under CPT, but must also procure cargo insurance
against the buyer‟s risk of loss of, or damage to the goods during the carriage the seller must
clear the goods for export. The critical points worth noting are:
Carriage and Insurance to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods have been delivered to the
carrier.
Cost transfer at the port of destination, buyer paying such costs as are not for the seller‟s
account under the contract of carriage.
12.9.DAF - Delivered at Frontier (named place)
The seller fulfills his obligation to deliver when the goods are available, cleared for export, at
the named point and place at the frontier, but before the customs border of the adjoining
country. Title, risk and responsibility for import clearance pass to buyer when delivered to
named border point/ frontier by the seller. The term "frontier" covers any frontier including
that of the country of export. Therefore, it is vital that the frontier in question be defined
precisely by naming the point and place in the term. The term applies primarily to the goods
carried by rail, or road, but may be used for any mode of transport. The critical points worth
noting are:
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods have been delivered at the
frontier.
Cost transfer from the seller to the buyer when the goods have been delivered at the
frontier.
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12.10. DES - Delivered EX Ship (named port of destination)
The seller satisfies his obligation to deliver when the goods are available to the buyer on
board the ship unclear for import at the named port of destination. Title, risk, responsibility
for vessel discharge and import clearance passes to buyer when seller delivers goods on board
the ship at the destination port. The critical points worth noting are:
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer on board the ship at the port of destination.
Cost transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer on board the ship at the port of destination.
12.11. DEQ - Delivered EX Quay (named port of destination)
The seller fulfills his obligation to deliver when the goods are available to the buyer on the
quay (wharf) at the named port of destination cleared for importation. . The critical points
worth noting are:
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer on the quay.
Cost transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer on the quay
12.12. DDU - Delivered Duty Unpaid (named place of destination)
The seller fulfills his obligation to deliver when the goods are available at the named place in
the country of importation. Title, risk and responsibility of import clearance pass to buyer
when seller delivers goods to named destination point in the country of importation. Buyer is
obligated for import clearance.
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer.
Cost transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer
12.13. DDP - Delivered Duty Paid (named place of destination)
The seller fulfills his obligation to deliver when the goods are available at the named place in
the country of importation. Title and risk pass to buyer when seller delivers goods to named
destination point cleared for import. Seller is obligated for import clearance.
Carriage to be arranged by the seller.
Risk transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer.
Cost transfer from the seller to the buyer when the goods are placed at the disposal of the
buyer.
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13. ORDER MANAGEMENT IN GARMENTS INDUSTRY.
Order management essentially involves all those activities, which are essential in managing
the order smoothly. Hence this involves:
Follow Ups & Updates.
Approvals.
Inter Department Co-ordination.
13.1.Follow Up’s & Updates. Regular and timely follow ups are important to ensure that everybody involved in the
execution of the style is updated and is performing his / her activities on time.
A merchandiser should plan his / her day based on the T&A activities that are due for the
day. Ideally the merchandiser should look at the activities that are due for the coming 2-3
days and should start his follow up accordingly.
Meaning to say that the merchandiser should start sending out reminders and alerts for
activities that are due for the next 2-3 days
Besides just following up on the completion of the activity, a merchandiser is also
required to do a production follow up. This means that the merchandiser should check the
production status of his styles every day.
In case the agreed production is not being achieved over a period of 2-3 days, this should
be brought up as an alert and senior management should be involved to review the
situation. To explain it further:
For example - the agreed production of the style / day was 300 garments. Merchandiser
observes that over the last 2-3 days factory has not been manufacturing 300 garments but
somewhere between 250 – 275 garments. If this situation is not looked at, a backlog of 25 –
50 garments every day, if continues over a week‟s time will result in 1 day backlog. Hence
this can result in delays in the shipment, overtime, and hence additional costs. Similarly the
merchandiser should monitor the production at every stage – cutting, sewing, finishing,
packing, washing & embroidery etc (if any in the style).
On a weekly basis the merchandiser should also update everybody on the status of the style.
This is important so that everybody involved with the style can review his / hr planning
accordingly.
For example - In case the fabric is being delayed by 1 week, it is important that that the
production in-charge is aware of the situation well in advance so that he can re-plan the
production slot based on when the fabric is due to arrive. The merchandiser also has to update
the customer / buyer on a weekly basis. This is generally done through a report which is
called – WIP*
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*WIP report – WIP stands for Work In Progress. Hence, this report details the work in
progress on the style. It provides the buyer with complete picture in terms of fabric, testing,
approvals and production status. It is essential that the merchandiser send this report to buyer
on a weekly basis. On receipt the buyer reviews the situation and puts his comments in the
remarks column and sends the report back to the merchandiser. Hence this report also
becomes a tool for communication between the buyer and the merchandiser. This helps in
eliminating lengthy e-mails and is easier to understand as well.
13.2. Approvals.
It is very important to have all approvals on time to be able to ship the order on time.
Hence merchandiser should pay special emphasis on the following up on the approvals.
Any delayed approval can hamper the entire production schedule of the style, resulting in
delayed shipments.
In order to get the approval on time, the merchandiser has to insure that the item to be
approved is ready on time and the approving authority is also available at that time.
Hence the merchandiser has to do a co-ordination function to get everything together so
that the approval is faster.
For example - As detailed earlier, fitting happens on a live model and hence happens either
once or twice a week only. Let us take a situation where the fitting session happens on every
Thursday of the week in New York.
In such a situation a merchandiser of a factory in South East Asia should ensure that the
sample is dispatched latest by Saturday so that the sample reaches the buyer by Tuesday
or Wednesday and is then fitted on Thursday.
In case the sample is dispatched on Tuesday, it will not reach the buyer by Thursday and
hence will be scheduled for the next Thursday fitting session. This results in un-necessary
loss of time.
Hence the merchandiser should have tried to pre-pone the dispatch of sample by 1 day
and should have used an overnight courier to get the sample to buyer on time.
Besides having timely approvals, some of the key points that every merchandiser should take
care while getting or making an approval are:
The quality for which the item is being approved for should be clearly mentioned and
counter signed.
For example - in case a fabric is only approved for the design and not for the colors, the
merchandiser should mention “approved for design only, not approved for color”
Further, reasons for color not being approved should be clearly mentioned.
Also the next steps to be taken should be mentioned there and then or the corrective steps
required should be mentioned.
Page | 105
Following example - the next statement should be – “please re-submit for color approval”
Next the merchandiser should also lay down the timeline for the next submission;
meaning to say the next date of submission should be advised there and then to avoid any
confusion.
Once the approval is granted, the same should be conveyed to all concerned parties or
departments. For example: a fabric approval should be conveyed to fabric stores,
Inspection team and production team. Not only the communication should be my means
of e-mail etc, but a fabric swatch signed by the merchandiser should be sent to these
departments so that they are aware of the approval and can always refer to the same in
case of a doubt. Similarly for a sample, a counter sample should always be available with
the production (sewing, finishing & packing) departments and the Quality Control
department.
The merchandiser for future reviews and discussions should retain all communication
with regards to approvals.
13.3. Inter Department Co-ordination.
Inter department co-ordination is one of the most important work that a merchandiser has to
perform at all times. The merchandiser has to interact and work with the following
departments – Product Development, Production (Sewing, finishing & packing), Sampling,
Purchase, Stores & Inventory, Quality and Logistics. Thus it becomes essential that the
merchandiser understand the needs of all the departments and works accordingly.
For example - The logistic department will not move the shipment out of factory until and
unless they have inspection certificate from the QC department, and the packing list of the
shipment. Hence, before even approaching the department for shipping details, the
merchandiser should ensure that the department has received the packing list and the IC
(inspection certificate).
Similarly, a quality auditor will not proceed to do the FINAL shipment audit till the time all
cartons are packed. The reason being, that he audit is done on a random selection basis, and
so no cartons or samples should be added to the shipment after the final audit is done. Hence
it is quality auditor‟s responsibility to ensure that he proceeds with the audit only once all
cartons are packed and the production department provides him with a packing list. Hence,
instead of pushing the auditor for inspection, the merchandiser should ensure that goods are
fully packed and the packing list is available.
To be able to get the work done smoothly and quickly, the merchandiser at all times should
work as a coordinator between departments and should help in avoiding conflict situation
between departments.
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14. SOME DOCUMENTATION OF MERCHANDISING.
Proper documentation leads proper management. In garments merchandising, the
merchandisers has to maintain all of the documents perfectly. A single mistake or wrong
information can hamper a huge production. Every year many of our Bangladeshi garments
get defeat of huge amounts because of miss documentation or miss understanding the
documents. Some important documentation is described below.
14.1. Sourcing Documents
One of the essential elements of sourcing is the documentation and formulation of
agreements involving the parties concerned. A thorough understanding of the documentation
involved in sourcing is a key requirement for a merchandiser.
Once the buyer/ importer and supplier/ exporter have entered into the Underlying Contract, it
is followed by formulation of the Letter of Credit, which acts as the primary document for all
further transactions and documentation. There are a couple of additional documents
accompanying the Letter of Credit, mentioned hereunder:
Bills of Lading.
Insurance Documents.
Invoice.
Certificates of Origin.
Order Confirmation Documents.
Import Documents.
Received Materials Document.
Documentation during Production.
Export Documents.
Weight Note/List or Packing List.
Air Waybill.
14.2. Letter of Credit.
In simple terms, a letter of credit is an undertaking by a bank to make a payment to a named
beneficiary within a specified time, against the presentation of documents, which comply
strictly with the terms of the letter of credit. Its main advantage is providing security to both
the exporter and the importer, but the security offered, however, comes at a price and must be
weighed against the additional costs resulting from bank charges. The exporter must
understand the conditional nature of the letter of credit and the fact that payment will not be
made unless the terms of the credit are met precisely.
Page | 107
Figure.
Some part of master L/C
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A letter of credit is opened by an importer (applicant), to ensure that the documentation
requested reflects and proves that the seller/ supplier has fulfilled his contractual obligations
specified under the requirements of the underlying sales contract, by making them conditions
of the letter of credit. The sales contract is not an inherent part of the letter of credit, although
the letter of credit may contain a reference to such contract. For the exporter a letter of credit,
apart from cash in advance, is the most secure method of payment in international trade as
long as the terms of the credit are met. The following diagram shows those involved in a
Letter of Credit transaction: When an exporter asks for payment by letter of credit, he is
transferring the risk of non-payment by the buyer to the issuing bank (and the confirming
bank if the letter of credit is confirmed), provided the exporter presents the required
documents in strict compliance with the credit.
14.3.Documentation for Opening L/C.
For opening L/C the bank will provide the following things
L/C application form.
IMP form (import permission form).
Agreement form.
Guarantee form
Have to fill up the forms mentioned above and after verifying and signing the following
documents should be submitted to the bank.
Trade license (valid).
IRC (import Registration certificate).
Membership certificate.
Memorandum of association.
Income tax declaration.
A photograph
14.4.Bill of Lading.
It is a document issued by a carrier (railroad, steamship or trucking company), which serves
as a receipt for the goods to be delivered to a designated person or to his order. The bill of
lading describes the conditions under which the goods are accepted by the carrier and details
the nature and quantity of the goods, name of vessel (if shipped by sea), identifying marks
and numbers, destination, etc. The person sending the goods is the "shipper" or "consignor,"
the company or agent transporting the goods is the "carrier", and the person for whom the
goods are destined is the "consignee". If negotiable, i.e., payable to the shipper‟s order and
properly endorsed, title to the goods passes upon delivery of the bill of lading.
A traditional bill of lading has a threefold purpose
Formal receipt by the ship owner for goods.
Evidence of the contract of carriage.
Document of title to goods.
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14.5.Insurance Documents.
The critical points worth observing are:
The extent of the cover agrees precisely with the credit terms, bearing in mind that
Institute.
Cargo Clauses (All Risks) do not always cover special risks.
The date of the insurance document is not later than the shipment date or, if dated after
shipment, it bears a clause to the effect that cover commences not later than the date of
shipment.
Claims are payable in the place specified in the credit.
The amount payable is in accordance with the credit terms plus any specified percentage
and is in the currency of the credit.
Marks, weights and description of the goods agree with the bill of lading and all other
documents.
The policy or certificate required by the credit terms is signed by the insurance company,
agents or underwriters and endorsed as necessary.
14.6.Invoice
A business document that contains the names and addresses of the buyer and the seller, the
date and terms of the sale, a description of the goods, the price of the goods, and the mode of
transportation used to ship the goods. The seller calls the invoice a sales invoice; the buyer
calls it a purchase invoice. The critical points worth noting are:
These should have been completed by the seller in the name of the buyer/ importer unless
the credit specifies otherwise.
Totals of all invoices agree with the amount of the drawing.
Prices and shipment terms (FOB and CIF etc) agree with the credit.
If a combined invoice and certificate of origin is called for, the certificate of origin is duly
completed and signed.
The full and exact description of the goods as shown on the credit appears on the invoice
and that the quantity and specifications are as called for. If goods are described as being
“...... in accordance with pro forma invoice number ...... dated ......” this can reduce
superfluous, error-producing detail.
There are no additional goods, charges or deductions not authorized in the credit.
However, a deduction of normal trade discount is allowed as long as the final amount is
correct – neither overdrawn nor under drawn.
If both an invoice and a packing list are called for, no “combined invoice and packing
list” should be offered. An appropriately detailed extra invoice may often satisfy the
packing list need, if suitably headed.
Pro forma invoice numbers or reference numbers are required by the credit is shown.
Marks and weights (net unless the credit states otherwise), number of cases and name of
vessel agree with the bill of lading and other documents.
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Figure.
An example of proforma invoice
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Figure.
An example of commercial invoice
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14.7.Certificate of Origin.
A certificate stating the country, in which a commodity has been grown, milled, produced,
manufactured or assembled, issued by a Consular Office or a Chamber of Commerce.
Frequently used by customs of importing countries in ascertaining duties under preferential
tariff programs or in connection with regulating imports from specific sources. The critical
points worth noting are:
All details quoted, shipping marks and description of goods, agree with the Letter of
Credit, bill of lading and other documents.
The certificate does not conflict with other documents with regard to value and country of
origin.
Figure18.4
An example of certificate of origin
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14.8.Order Confirmation Documents.
Copy of master L/C or received of this documentation from the buyer, the exporters become
sure that they would obtain foreign currency after the perches shipment.
Contract sheet
Sing by buyer and vender (2 pages)
Style number.
Shipment date.
Mode of shipment (sea/air).
Order quantity and size ratio.
Fabric description.
Labels etc.
Product package
10- 15 page.
Spec sheet.
Stitch & seam type.
Position of levels, taken tag, price ticker.
Sketches partly of each garment.
Trim card with approval
Swatch card.
14.9.Import Documents.
Proforma invoice> Total requirement, how many fabric, trims.
Commercial invoice > Fabric unit price, trim unit price.
Packing list > How many roles Break down each fabric roles.
UP (utilization permission) > given from the government.
PSI certificate/ pre-shipment inspection (if necessary).
14.10. Documentation on Receipt of the Material at the Factory.
Inventory report > from store manager.
Fabric and accessories swatch (actual).
14.11. Documentation during Production.
Daily production report.
Daily quality report.
Daily production report DUPRO.
14.12. Export Documentation.
Packing list.
IC (inspection certificate) Buyer QC team.
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Bill at leading {(B/L) sea} Collect from ship.
Air way bill (air).
Certificate of origin Collect from custom.
14.13. Packing List/ Weight Note.
This document itemizes shipment contents. It should include weight (gross and net),
dimensions, contents, numbering of each parcel within the shipment, and any identifying
characteristics (e.g., serial numbers). While importing fabric, packing list can play an
important role in shade wise segregating fabric rolls, if the rolls have been packed in bales
according to their shade lots. It also can be used to identify damages or shortages; the buyer
only pays duty on what was actually received. The critical points worth noting are:
It must bear an authorized signature of the person/firm/company issuing the certificate in
the detail required.
If a weight list is called for by the credit, this requires the individual weight of each parcel
or package together with the total weight.
Figure.
An example of packing list
14.14. Air Way Bill.
An air way bill accompanies goods in shipment and which details the cost and route of
shipment. The critical points worth noting are:
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These should be issued and stamped by an airline on standard forms and should appear to
be the original for the shipper (usually copy 3). This shows: name of consignee, goods,
which must agree with the credit and all other documents, flight number and date, freight
paid or to be paid at destination (again, in accordance with the terms of the credit).
Ensure that the correct copy is submitted, bearing a clear reception stamp with signature
of the carrier or his agent.
Air waybills issued by freight forwarders and referred to a master air waybill are not
acceptable unless a certificate is presented stating that the forwarders are acting as agents
for the carriers.
15. ORDER ACHIVEMENT ANALYSES.
Once the order is shipped out of the factory a merchandiser has to submit a report called
Order clearance report. The report the report consists of following information related to the
style or order, which is shipped.
15.1. Material Utilization Report.
This is an analysis done on the materials ordered and utilized for the order. This essentially
contains information on the quantity we had ordered, the quantity which we could have
utilized and the actual utilization. An analysis like this done for every style would give
necessary input for MRP which would further help in effective material management and
reducing costs. A copy of such report is often sent to the business audit departments for
monetary evaluation of wastages.
15.2. Style and factory capability report.
The merchant keeps a track of the order when is loaded in the lines. This would give him/her
the date and time for loading and along with it the merchant also keeps the track of the order
when it comes out of the production lines completely. Using these and the data regarding the
working hours and manpower can give the style efficiency for the order in that production
line. This report helps in studying the capability of the factory with respect to different lines
and gives necessary directions to the marketing and planning teams for future orders. A
report like this is generally prepared by the Industrial engineering team, which later is
submitted to the merchants to complete his/her order clearance report.
15.3. Product quality report.
Keeping a track and report of inspection at various stages and consolidating all these in the
style folder would give the factory capability pertaining to the quality aspect of the order.
This further would help in locating the areas of failures and knowing the rolled throughput
yield of the factory for that style measured from the quality perspective.
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16. CONCLUSION.
In conclusion I can say that is dissertation report is really essential for every students of
AMM Dept. By completing this report I have already got overall idea About merchandising
of RMG sector and these may be helpful to know about the technical and management
knowledge of apparel industry also these sector related organizations. Apart from the above
mention procedures, merchandiser has to assign subordinates to help him in the order
execution, and direct the procedures. He has to revise his knowledge from time-to-time to
know current market trends. To record preferences for all the planned activities, use daily or
time log systems. The Merchandiser should find out exact reasons for time consumption. It is
necessary to keep record of time value and keeping it safe, as it is going to be shared with
concerned parties/buyers. It is certain that merchandising jobs need huge time planning.
17. RECOMANDATIONS.
Bangladesh has progressed considerably in the export of readymade garments. Three fourths
of our export comes from in this sector. Though Bangladesh has gone very deep in terms of
quantity but it still now produce goods for the lower end of the market. The other aspect of
improving quality with motivated manpower. It is essential to improve quality of
management, activities attitude. In this sense STARLET APPARELS LTD. is very careful
about quality, manpower etc. Their management power is very strong but sometimes there is
a little bit problem is arisen during working because most of their stuffs are new and comes
from different subject without some quantity of related subject Finally I recommend that
when you will recruit please should consider about related subject ,because this persons will
be highly efficient than others.
18. BIBLIOGRAPHY.
Garment & Textile Merchandising. (By M.A Razzaque)
Garments & Technology (By M.A. Kasem)
Quality Management in Apparel Industry. (By A.J.S.M. Khaled.)
Work Study & Productivity Improvement Technique in Apparel Industry. (By A.J.S.M.
Khalid.)
Fashion Marketing. Second Edition (Edited by Mike Easey)
Fabric Manufacturing Technology. (By Md. Moshiour Rahman).
Internet.
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19. APPENDIX.
At last I can say that merchandising management is a cross-function approach including
managing the movement of raw materials into an organization, certain aspects of the internal
processing of materials into finished goods, and the movement of finished goods out of the
organization and toward the end-consumer. As organizations strive to focus on core
competencies and becoming more flexible, they reduce their ownership of raw materials
sources and distribution channels. These functions are increasingly being outsourced to other
entities that can perform the activities better or more cost effectively. The effect is to increase
the number of organizations involved in satisfying customer demand, while reducing
management control of daily logistics operations. Less control and more merchandising
partners led to the creation of merchandising management concepts. The purpose of
merchandising management is to improve trust and collaboration among merchandising
partners, thus improving inventory visibility and the velocity of inventory movement.
