ORGANISATION STUDY AT

MASCOT INDUSTRIES, KANNUR

MASTER OF BUSINESS ADMINISTRATION OF

KERALA UNIVERSITY

Submitted by

ABDUL SUBEER KK
REGISTER NO: 0905351

UNDER THE GUIDANCE OF

FACULTYGUIDE PROJECTGUIDE

Ms. ARCHANA V.V Ms. Rupa,

FACULTY, Customer Care Officer

IMK ADOOR MASCOT INDUSTRIES
KANNUR

INSTITUTE OF MANAGEMENT IN KERALA

ADOOR, PATHANAMTHITTA
 JANUARY 2010

DECLARATION

I Abdul subeer K.K, hereby declare that this report is a bonafide record
of the organisation study done by me at “MASCOT INDUSTRIES,
KANNUR”. This study has been undertaken in partial fulfillment for the degree
of MBA at IMK ADOOR affiliated to Kerala University.

I also declare that this report has not been submitted to any other
university/institute and has been completed with my true knowledge.

Place: Adoor Abdul Subeer K.K

Date: Reg. No. 0905351

IMK ADOOR Page 2

 ACKNOWLEDGEMENT

This report has been made fruitful with the help and co-operation of
various people to whom I wish to express my gratitude.

First of all, I thank our Co-ordinator, Mr. Manoj Krishnan C.G. who
had given me permission to do this project.

I sincerely acknowledge my deep gratitude to Mr. C. Jayachandran,

Chief Executive, Mascot Industries, for giving me an opportunity to do my
project in the organization and make use of the facilities available.

I extend my sincere thanks to Ms. Rupa, Customer Care

Officer,Mascot Industries, for all the advices she has provided and for the
valuable time she had set aside for me.

I also take this opportunity to express my sincere gratitude and

indebtedness to my project guide Ms Archana V.V, faculty of IMK Adoor,
whose encouragement and guidance helped me a lot in bringing out this Report.

I thank God Almighty for showering me with abundant grace for the successful
completion of the Organization Study.

Abdul
Subeer KK

IMK ADOOR Page 3

 INDEX

Chapter Content Page no:

1 INTRODUCTION 5-9
2 INDUSTRY PROFILE 10-19
3 COMPANY PROFILE 20-25
4 DEPARTMENTAL PROFILE 26-45
5 COMPETITION ANALYSIS 46-51
6 SWOT ANALYSIS 52-55
7 FINDINGS 56-59
BIBLIOGRAPHY 60

IMK ADOOR Page 4

 CHAPTER-1

INTRODUCTION

IMK ADOOR Page 5

 INTRODUCTION

INTRODUCTION OF THE STUDY

Organization is a social unit which is deliberately constructed and

reconstructed to seek specific goals. An organization comes into existence when
there are a number of persons in communication and relationship to each other
and are willing to contribute towards a common endeavor. The evolution of
organization dates back to the early stages of human civilization when two or
more persons began to co-operate and combine together for fulfilling their basic
needs of food, clothing, shelter and protection of life. Thus, an organization is
born when people combine their efforts for some common purpose. It is a
universal truth that an individual is unable to fulfill his needs and desires alone
because he lacks strength, ability and resources. So he seeks the co-operation of
other people who share goals with him.

Every organization is different from another organization in many

aspects like its culture, working, social and political factors and even lots more.
The general objective of the study is to gain practical knowledge on the overall
functioning of various departments of the organization. The study mainly
concentrated on the organization structure, the its various departments, their
activities and functions.

Mascot Industries is a handloom exporting company in Kannur. It was

established in 1940 as handloom weaving unit and later registered as an
exporting company. Now mascot Industries is exporting handlooms and fabrics
to more than 15 countries.

IMK ADOOR Page 6

OBJECTIVES OF THE STUDY

1. To study about the organisation.

2. To study organisational structure of Mascot Industries.

3. To analyze and study the functioning of the various departments of the

company.

4. To understand the various functions.

5. Understanding the organizational work culture.

6. Findings the problems and limitations of the organization, if any, and

giving appropriate suggestions to overcome the difficulties.

7. To identify opportunities, threats, strengths, and weakness of the

departments.

DATA COLLECTION

The data relevant for the study were taken from primary and secondary
sources.

PRIMARY DATA: This data was obtained by interviewing chief

executive , interviewing various Head of Departments etc.

SECONDARY DATA: This data was collected from various secondary

sources like broachers of the company, reports of the company etc.

IMK ADOOR Page 7

CHAPTERISATION

This project report is mainly divided into seven chapters and each of them
deals with the following.

CHAPTER 1: INTRODUCTION

It deals with the objectives of the study, data collection etc.

CHAPTER 2: INDUSTRY PROFILE

It deals with the details regarding the Textile Industry.

CHAPTER 3: COMPANY PROFILE

It deals with the history, top management, major milestones, quality

policy , etc.

CHAPTER 4: DEPARTMENT PROFILE

It deals with the details such as Structuring, Functioning of various

departments.

CHAPTER 5: PORTER’S FIVE FORCES MODEL

It deals with the Porter’s five forces model model of the Industry.

IMK ADOOR Page 8

CHAPTER 6: SWOT ANALYSIS

CHAPTER 7: FINDINGS, CONCLUSION & SUGGESTIONS

It deals with the findings, conclusion & suggestions made after the study

LIMITATIONS OF THE STUDY

 A detail study was not possible within a short period because the
Organisation is Large Scale Industry.

 There can be bias of the opinion provided by the staffs.

 The study was descriptive in nature. So analysis was not conducted and
an in depth study was not done.

 Also the research uses the techniques of science, but it is not an exact
science. So the results obtained are not much applicable in all situations.

IMK ADOOR Page 9

CHAPTER-2

IMK ADOOR Page 10

 INDUSTRY PROFILE

INDUSTRY PROFILE

TEXTILE INDUSTRY

Most of us know that in the new millennium, global manufacturing hub is

shifted to Asian continent. China and India will be the major players for
meeting the global needs. But in almost all the fronts, India is in the very distant
second position. In the textiles we have better position in Home textiles and
very distant second in Apparels.

EVOLUTION OF TEXTILE MILL INDUSTRY

In early 18th century most of the population lived in small rural

settlements and few people only lived in towns. Many people worked as
producers of woolen and cotton cloth. They cleaned, combed, spun dyed and
wove the raw materials into cloth and this work was done in their own houses.
This type of production was termed as domestic or cottage industry. Work
within the cottage industry was usually divided between the members of the
family. The process of weaving was physically hard work and traditionally it
was the men who were responsible for it. Generally at regular intervals each

IMK ADOOR Page 11

handloom weaver’s cottage was visited by a cloth merchant. He would bring the
raw material and take away the finished cloth to sell at the cloth hall.

As soon as the new wool arrived it was washed to clean out all the dirt
and natural oil. After this it was dyed with colour and carded. This was the
process of combing the wool between two parallel pads of the nails, until all the
fibres were lying the same way, then the carded wool was taken by the
spinner ,using a spinning wheel, the thread was wound into a bobbin. The spin
yarn was then taken to the loom to be woven. In a weaver’s cottage the loom
was often to be found in an upper floor were there are large windows worked by
both hand and foot movements working of the loom were quite strenuous work,
which is why it was traditionally the work of the men of the household. With
the advantage of the industrial revolution the whole process of manufacturing
yarn and the subsequent production of cloth underwent a dramatic change.
Industrial revolution brought about the widespread replacement of manual
labour of machines. Goods that had traditionally been made in the homes or in
the small workshop began to be manufactured in the factories. Productivity and
technical efficiency grew dramatically in part through the systematic and
practical knowledge of the manufacturing process.

The production of yarn too shifted from the households to the factories
where large number of men and women were employed to produce yarn on a
large scale. The process were automated and became more efficient. One
process which underwent a drastic change was spinning or weaving mills. Now
electricity is used which is faster than hand spinning.

Another major invention was the power loom. The power loom was
steam powered mechanically operated version of regular looms, an invention
that combined threads to make cloth. In 1785 EDMUND CART WRIGHT
patented the first power loom and set up a factory in DON CASTER ,

IMK ADOOR Page 12

ENGLAND, to manufacture cloth. It improved up on by WILLIAM
HORROCKY and.

FRANCIS COBOT LOWELL was an American businessman and the

founder of the world’s first textile mill. Together with inventor PAUL
MOODY, Lowell created a move efficient power loom and spinning apparatus.
All this accelerated the growth of mill industry with production capacities, and
the labuorers employed in the industry rising to millions.

INDIAN TEXTILE INDUSTRY

The Indian Textile Industry has a great legacy which is perhaps

unmatched in the history of India’s industrial development. India’s textile
industry evolved and developed at a very early stage and its manufacturing
technology was amongst the best India’s manually operated machines were
among the best in the world and served as a model for production of the first
textile machines in newly industrialized Britain and Germany. India’s textiles
were sought after for its finest quality and design and attracted people from
across the globe like Chinese, Malaysians, and Portuguese etc.

Colonization put an end to India’s glorious textile legacy. By 1880 the

domestic market had grown to be served solely by British manufacturers. One
of the aspects freedom struggle led by Mahatma Gandhi was to weaken the
British Textile Industry by weaving homespun clothes as he was convinced that
textile sector would be a catalyst in advancement of I(ndian population.

Post Independence , till 1980 , the Government of India put numerous

restrictions to ensure mechanization, it did not occur ; labour intensive textile

IMK ADOOR Page 13

were produced which in effect led to increase in price and decrease in
productivity.

The textile policy of 1985 has added a new beginning in the history of
Indian textile industry. It identified the main task of textile industry as increase
in production of cloth of acceptable quality at reasonable price to meet the
clothing requirements of the population. The 1985 policy, illustrated the
government’s attempt to relax the regulatory burden of the composite mills
sector by elimination of compartmentalization in the industry, lifting of
restrictions on composite mill, loom capacity expansion and equalization of
taxation among composite mills, power looms and independent processing
units. The textile industry was de licensed as per the statement of Industrial
Policy of 1991 and the textile Development and Regulation order of 1992.

All the measures liberated from the shackles of regulation that were in place in
the 1980s and were steps in ensuring that the different segments of the textile
industry became competitive in the work of globalization.

HANDLOOM TEXTILES IN KERALA

The centuries old history of handloom in Kerala starts from Thorth to

high end furnishings. Major items manufactured here are Thorth , Mundu, Set
Mundu for ladies , Sarees, lunges, Shirtings, Terry towel, bed sheets, jacquard
fabric, cotton crepe, table linens, Bed linens, Kitchen textiles, Curtains, Pillow
covers, Upholstery Fabric and other furnishing fabrics. Now North Malabar is
the main centre of manufacturing of hand woven textiles in Kerala and other
places like Balaramapuram has some production of Dhothies and Sarees.
Manufacturers of Handloom fabrics in North started their export about 50 years
back. In 2005 Government of India recognized Kannur as a city of Export
Excellence for their contribution in the export of mainly Home Textiles. Export
from Kannur has crossed Rs. 300 crores.

IMK ADOOR Page 14

 Kerala has centuries old tradition in handloom and the epic centre is
North Malabar. There was lot of evolutions that took place in this cottage
industry over centuries.

It is believed that Saliyas migrated in Malabar during the Dynasty of

Kolathiry , Samoothiry, and Perumal from Tamil Nadu, Andhra Pradesh,
Karnataka and even from Kutch provinces of Gujarat. These rulers had given all
the privileges because of their weaving skill and they were provided housing in
their community streets with Mandapum at the centre and bathing ghats for
male and female for their exclusive use. Even today this street culture is seen in
all these states. They had set up Kuzhithari (Pitloom) in every house, probably
the cheapest cloth weaving machine in the world. They had developed
technology of weaving by employing few wooden frame, poles pedels and
strings. This was the throw shuttle pit looms. Poorani , a wooden frame used for
warping about 15 meters length of warp. Nalli chakram (charka) used for warp
and weft winding. About three inches long Vellila thandu Tharu used as left
carrier in the wooden or horn made throw shuttle. Rice starch was used for
sizing the warp yarn. In those days, saliya brides best qualification was the
efficiency in the preparatory work of weaving, winding, warping and sizing.
Preparatory work was totally managed by the women and weaving by men.
Almost the same tradition with some exception is practiced today also. A census
report of 1881 based on cast and trade recorded nearly a lakh in the clothing
sector including tailors in a Malabar and half of them were belong to saliya
community.

saliya also played an important role in the communist movement of

Malabar. Because of its closed society nature comrades could hold secret
meetings during its difficult period of pre-independance and post-independence
time.

IMK ADOOR Page 15

 Europeans could not implement their policy of forcing Indians to use
imported clothing from their countries and they succumbed to the pressure of
non co-operative movement initiated by Mahathma Gandhi. Our handloom
weavers played an important role for the success of the non Co-operative
movement during freedom struggle. Simultaneously by taking the advantages of
casteism in Hindus, European missionaries started converting dissatisfied
Hindus to Christianity by promising shelters, training, job and social status.
Missionary had chosen hand loom weaving as one of the job area. As part of
their strategy, during the middle of 19th century Bassel Missionary started
several handloom factories in Malabar. Germans had developed frame loom
with flying shuttle and mill warping which made a revolutionary change in the
field of handloom weaving.

Along with saliyas, other communities like Christians and Muslims also
entered in this weaving job. At the beginning of the 20th century, Sri Narayana
Guru initiated the social reforms in all over Kerala and Thiyyas/other backward
communities were also motivated in taking up the handloom weaving job.

Throw shuttle pit loom slowly became out dated by the middle of 20th
century because of its limitations in weaving of heavy fabrics, low production
and non versatility. Frame loom with flying shuttle could weave intricate
designs and ceck patterns with comparatively high production. Thanks to te
Germans for developing Frame shuttle loom which could mount Jacquard, terry
motion, multy treadle and also strong enough to weave heavier fabrics like
todays furnishing and table linanens. COM trust of Calicut(Old Bassel
Missionary) is the est evidence of this evolution and revolution. T the beginning
of 20th century many private entrepreneurs started handloom factories in nort
Malabar. Mr Samuel Aron should be remembered as the icon of modern
handloom weaving in northern Malabar. His contribution to industry has
immense in developing infrastructure including supporting facilities like

IMK ADOOR Page 16

spinning of yarn. Along with him somany other entrepreneurs stared their
factories ans the last quarter of 20th century witnessed a mmile stone in the
history of Kannur handloom textiles- Kannur Cotton Crepe. Kannur Cotton
Crepe was ana innovation which was a pride for Kannur. During the same
period when the industry in the peak time, trade disputes between private
management and the trade union affected the total industry. As a result many
factories started closing down. Due to the stiff competition from the
neighboring states and higher input cost in Kannur, Handloom products for the
domestic market became costly and non marketable. Further, clothing industry
also had a big change during the second half of the 20th century. There were a
lot of innovations in the manmade fiber, which changed the cotton clothing
industry to blended clothing. Blended and manmade clothing are more durable
and easy caring. So domestic market of hand woven clothing has started falling.

During the middle of 20th century many weavers’ co-operative societies

have been formed in north Malabar areas. By seeing the success of these
societies other parts of Kerala also had seen the similar development. But the
societies of north Malabar could only sustain the growth due to more favorable
reasons. In the recent years, some societies are doing their own exports and
many are supportive a manufactures for leading exports of Kannur. Many
societies have their own outlets to sell their products in the local market.

KANNUR HANDLOOMS

History says that weaving in Kannur started some150 years ago. During
the period of Chirakkal Rajas, pit loom weaving was introduced for preparing
the royal attire. Since before weaving,there are other activities like dyeing,
winding, warping, joining etc, a group of workers needed for the whole process.
Such groups settled in various areas in the districts and these settlements were

IMK ADOOR Page 17

called THERUS. The weaving communities in these Therus were called
“Saliyas.

A major turning point into the transformation of the activities into an

organized weaving industry was with the arrival of the Christian Missionaries in
1883. The Bassal Mission was active in the entire North Malabar area and up to
Mangalore. A small factory was set up by the mission in 1844, at Mangalore.

The first Frame Loom was imported from Germany. Later as per the
guidance of German technicians, “Maggams” were manufactured locally only
throw shuttles were used in these looms. In 1851, the visit of weaving expert
Mr. Heller from Germany to the Mangalore factory led to the introduction of
“fly wheel filled shuttle. Even today, the same is being used extensively in
Malabar.

In 1844 at Calicut and in 1852 at Kannur, Bassal Mission started Frame

Loom weaving factories. “Mundu” was the initial product from these factories
and it was popularly known as ‘Misssion Mundu’. Later shirting checks and bed
sheets were added innovation led multy treadle and jacquard designed fabric
production. The success of these units motivated private entrepreneurs to
establish new weaving sheds in the district.

Handloom export activities from Kannur started in the early 1950s. infact
Kannur has completed 60 years of export. The huge employment opportunity
that this sector provided helped lacks of workers to earn their livelihood. It is
only second to agriculture for employing the largest workforce.

The one single product that made waves in the international market was
the ‘CREPE’ fabric from Kannur in the early 70s. There has been no other
single product that could gain such popularity and this trend continues strongly
even after 40 years. In the year 2007 export value touched Rs. 350 cores. Eight
out of the 52 leading handloom exporters of India are from this town. Top
IMK ADOOR Page 18
market buyers prefer Kannur as generations of owners have carried on with
unflinching efforts to retain the “best quality” tag. The fact that most of the
most of the top units are ISO certified shows that focus is on quality. Recently
national channel confirmed that product from Kannur are decorating the
WHITE HOUSE. The city started to known as “city of looms and lores”. When
the union textile ministry prepared the list of leading 24 textile centers of the
country for providing support to help in further export growth Kannur was
included. It is the only town from Kerala among the 24 textile centers in the
country. In 2002, the union commerce Ministry introduced the “Town of Export
Excellence” recognition. This was to towns that the substantial contribution of
towns that grew on its own strength to the national exports even without basic
government infrastructure. Tirupur, Ludiana and Panipath were the three towns
that got this approval in 2002. Later in 2003 Commerce Ministry decided to add
6 more towns.

The effort of the exporters from Kannur get into the prestigious list
proved successful in 2004, when the new EXIM policy was announced. Kannur
became the only town in Kerala to be recognized as TOWN OF EXPORT
EXCELLENCE for handloom exports. The remarkable journey continues….
Fighting against all odds, Kannur can proudly say that Kannur is among the
short list of 9 towns in the whole country with such recognition. The march to
further glory will continue, inspired by the bold and courageous generations of
1950s. The pioneers who started export from this town 60 years ago showed
that Kannur will strive to bring more fame and when Kannur celebrates 60 years
export they are trying to export the products of Kannur to at least 50 countries
in the world.

IMK ADOOR Page 19

 CHAPTER-3

IMK ADOOR Page 20

 COMPANY PROFILE

COMPANY PROFILE
HISTORY OF THE COMPANY

M/S Mascot Industries is a leading manufacturer and exporter of home

textiles and garments. The handloom unit was started by the late C.Raman in
1940 to enter into the Indian Market. His son Mr. C. Shekharan, who is a
visionary and a great entrepreneur, presence felt in European and American
markets and has never looked back. From 1985, the elder son of Mr. Shekharan,
Mr. C. Jayachandran has been part of the business and is currently the
Managing Partner (Chief Executive). Partners of the company are Mr.
C.Shekharan, Mrs. Jayanthi, Mr. C. Jayachandran and Mrs. Meena
Jayachandran.

Mascot Industries has completed 40 successful years in the field of

handloom exports in India. For its performance in the export field, the company
has been honoured by the Textile ministry for the last 23 successful years and is
acknowledged as being among the top 50 handloom exporters from India.

The present business of the company includes manufacture and export of

home textiles which includes fabrics, made ups and garments.

The unique feature of this organisation is its ability to deliver goods with
high quality standards, on time. This aspect was largely responsible for creating
satisfied customers with repeated orders.

The name Mascot has been given by the founder late C.Raman, which
means an object that, brings luck to the organisation. Mascot group has business

IMK ADOOR Page 21

in other areas like Hotel business(Mascot paradise hotel ) and a yarn spinning
mill(Prime Cottons)

MILESTONES

1. In 1968 company has got registered its name with registrar of companies

2. In 1970 company started its export.

3. In 198o, company has got ‘corporate membership’ of North Malabar

Chamber of Commerce, kannur.

4. In 1987 company has got the status of recognised export house by

Ministry of Textiles, government of India.

5. In December, 2001 Company has obtained internationally acclaimed and

prestigious ISO9001:2000 QUALITY MANAGEMENT SYSTEM
certificate from DET NORSKE VERIATAS (DNV) Netherlands.

6. Mascot Industries have been approved under BSCI (Business Social

Compliance Initiation) and ECO TEXT for environmental friendly
product.

7. In 2004 company has got ‘NIRYAT SREE’ Award from commerce

ministry, Government of India for doubling Export during 2002-2004.

QUALITY POLICY OF THE COMPANY

Company has a quality policy which helps the organisation to ensure

quality at every process and products . Quality policy of the company as
follows:

At MASCOT INDUSTRIES, we are committed to the

satisfaction of our customers by providing quality

Home textiles and Garments at Competitive prices,

meeting delivery Schedules, fulfilling customers’

requirements and focusing on continual improvement.

We achieve our aim through total involvement of our

IMK ADOOR Page 22

 dedicated employees & suppliers under an effective

QUALITY MANAGEMENT SYSTEM

MAJOR MARKETS

Mascot Industries has markets in 16 countries majority of which is

European Countries. Major markets are

Austria, Belgium, Denmark, England, Finland, France, Germany, Holland,

Japan, Luxemburg, Malaysia, Oman, Sweden, Switzerland, South Africa,
USA.

MANAGEMENT SYSTEM

In addition to the ISO 9001: 2000 system, Mascot Industries have been
approved under BSCI (Business Social Compliance Initiation ) and ECO TEXT
for environmental friendly product. BSCI is given by the consortium of 230
importing companies for a company which has good employee compliance
system. Mascot is doing everything possible to ensure employee satisfaction.
Mascot does not create any environmental problems. It has a very good waste
disposal system. These systems help in improving market acceptability
especially with new customers.

INFRASTRUCTURE

With its own centralized dying units, in house warping and winding
facilities, computerised design units and stitching facility, the company always
meets severe quality Standards and product conformances.

There are two manufacturing units, one at Azhikode and another at

Kulappuram, 35 km away from Kannur. There are 116 ordinary looms and 44
Jacquard looms .

The company is equipped with computerised design centre where it could

translate any design into production with least lead times.

A stitching unit equipped with high speed heavy duty sewing machines
including computerised embroidery machines, ensures fast and efficient

IMK ADOOR Page 23

manufacture of made ups and garments meeting international quality
requirements.

The company has established a well equipped chemical factory for testing
colour fastness and shrinkage properties.

Recently the company has added Polyster Fibre Opening machine, Vacuum
packer, needle detector and latest computer configuration as part of the office
automation to compete with fast growing industrial scenario.

The company can produce upto 50000 meters of fabrics per month and it
has capacity to convert 70% of the fabric into various home textiles.

The company had subsidiaries at Thiruvananthapuram and Quilon. Both

these subsidiaries have closed down because of heavy transportation cost an
lack of employees. Now is planning to start a new plant in the KINFRA
TEXTILES PARK at Nadukani near Taliparamba. Company has already
acquired lnad and is expected to start production within two years.

HUMAN RESOURCES

The company has got a total strength of 180 employees (109 at Azhikode
and 71 at Kulappuram) and there are about 30 supportive manufacturers.
Supportive manufacturers are those small scale manufacturers who assist the
company to produce handlooms when the company has got orders to produce
more than its capacity.

The company takes care different things like occupational safety, health
organization, fire prevention and protection, working premises , lighting, noise,
ventilation etc. The company sees to that right person in the right place. They
delegate chance for development of employees. They also give importance to
qualification and training of employees . Each employee is paid compensation
in accordance with the services. A standard is applied for every employees.
Complete records are maintained for staff and workers. The company keeps two
way communication with all employees

IMK ADOOR Page 24

 ORGANOGRAM

IMK ADOOR Page 25

 SENIOR
PARTNER

CHIEF
EXECUTIVE

MANAGER MANAGER MNAGEMENT CUSTOMER

DYEING MANAGER MANAGER
REPRESENTAT CARE EXPORT&MAR
ADMINISTRATI &WEAVING PPC IVE
ON
OFFICER KETING
(KUL)

ADMINISTRA Supervisor
Weaving Supervisor Export
TIVE Production
supervisor QA assistants
OFFICER I

Asst. Lab asst.

HR Stitching kulappura
Dyeing
supervisor m
OFFICER supervisor

Supervisor Finl
ACCOUNTS Production II inspcn
OFFICER
Receiving
PURCHASE
Asst. fabrics
ASSISTANT Supervisor
inspection
S
Stores&st
ock Weaving fabrics

ACCOUNTS asst. Made ups

ASSISTANT (azhi) inspection
S

Supervisor
Production
CASHIER III

Asst.
Supervisor

sample
Dyeing
asst.(azhi)

IMK ADOOR Page 26

 CHAPTER-4

DEPARTMENTAL PROFILE

ADMINISTRATION DEPARTMENT

IMK ADOOR Page 27

 General administration of the company is done by administration
department. Both accounting and HR department come under the purview of
administration department in Mascot Industries.

FUNCTIONS OF ADMINISTRATION DEPARTMENT

• Establish and document specifications for raw materials and

accessories

• Assess the availability of raw materials and accessories as per the

requirements

• Issue the raw materials to production department as per the

production order

• Intimate corrective actions in purchase

• Responsible for issue raw materials, stock update and material

reconciliation for yarn, dye and chemicals

• Purchase of raw materials through sales orders

• Find out new suppliers for raw materials

• Maintain inspection status of raw materials and accessories in the

store

• Maintaining general administration of the organisation

• Liaise with Employee State Insurance and Provident Fund officer

and other government agencies

• Maintain all the related record of PF and ESI

• Assess the manpower requirement in co-ordination with HOD/CE

• Maintain proper data base of all employees

IMK ADOOR Page 28

ACCOUNTING DEPARTMENT

The ambitious plans of a business would remain idle if adequate

money is not available. In early times, labour intensive methods of production
prevailed in most of the industries. But new due to the fast development in
science and technology, the labour intensive method of production is replaced
by capital intensive method of production.

At Mascot Industries major investment decisions are taken by the Chief

executive and the main function of accounting department is to record the daily
transactions of the business and maintain records for all transactions.

FUNCTIONS OF ACCOUNTING DEPARTMENT

• Record daily business transactions

• Maintains documents for all business transactions

• Prepare pay roll of employees

• Payment of wages

• Inform the CE about the financial position and status of the firm

• Purchase and valuation of inventories

SIGNIFICANT ACCOUNTING POLICIES

• The accounts are prepared on historical cost convention. All the

accounting not specifically referred to otherwise are consistent and
in consonance with Generally Accepted Accounting Principles.

• The inventory at the end of the year will be valued at cost or

market price whichever is less on FIFO method

IMK ADOOR Page 29

ACCOUNTING PROCEDURE

Mascot Industries prepare four types of journal. They are as follows;

• Cash Payment Book (CPB)

• Bank Payment Book (BPB)

• Cash Receipt Book (CRB)

• Bank Receipt Book (BRB)

At the end of every month the accounting department checks all the flow
of money i.e., to and from various departments of the company. At the end of
every financial year, profit and loss account and balance sheet is prepared from
which the financial position of the company is noticed.

SOURCES OF FUND

There are internal and external sources of funds. The main internal
sources of funds are income generated from sales and reserve. The major
external sources are term loans from bank and other NBFCs. The initial capital
was invested by the partners of the company.

HUMAN RESOURCE DEPARTMENT

Human Resources is an inevitable part of every organisation. Managing

human resource is a very difficult task in these modern times. In the case of
textile exporting company human resources management is a very important
task because foreign customers are always looking the way in which company
deals with its employees. Mascot Industries has got Business Social Compliance
Initiation for providing better employment facilities and ensuring zero child
labour.

FUNCTIONS OF HUMAN RESOURCE DEPARTMENT

IMK ADOOR Page 30

 • Human resource planning.

• Recruitment and Selection.

• Induction.

• Training and development.

• Performance appraisal and Promotion.

• Welfare measures.

• Establish health and safety programs.

• Grievance handling mechanism

HUMAN RESOURCE PROCESS

Following are the company’s HR process.

• Only persons having required experience and skills are employed by the
organisation.

• An induction criterion for each position in the organization is prepared

containing position, qualification, experience, skills required and training
required as per appendix.

• Wherever possible recruitment are done as per the induction criteria

depending upon the availability of suitable personnel.

• Employees’ assessments are carried out for arriving the employee

strength and weakness.

• A gap analysis is conducted based on competency of the existing

personnel against the desired competency required based on the induction
criteria and appraisal record.

IMK ADOOR Page 31

 • Suitable training is imparted wherever required as per the gap analysis.

• Training need of the supervisors and HODs are identified by the CE.

• Training need of the operatives is identified by the HODs.

• After imparting training, evaluation is conducted to assess the

effectiveness of the training.

• If needed, retraining is imparted.

• Appropriate documents are maintained employee wise about the

educational qualification, experience and training imparted.

DEPARTMENT HIERARCHY

IMK ADOOR Page 32

 CHIEF
EXECUTIVE

MANAGER PURCHASE
AND ADMINISTRATION

ACCOUNTS ADMINISTRATIVE
HR OFFICER
OFFICER OFFICER

PURCHASE
ASSISTANT

CASHIER

ACCOUNTS
ASSISTANT

PRODUCTION PLANNING AND CONTROL DEPARTMENT

IMK ADOOR Page 33

 Among all the functional areas of management production is considered
to be very crucial in any organization. “Production is a process by which raw
materials and other inputs are converted into more useful outputs. Production
management involves application of planning, organising, directing and
controlling to the production process.

FUNCTIONS OF PPC DEPARTMENT

Major functions of PPC department are;

• Planning the production activities

• Assess ad allocate facilities for the production

• Prepare and monitor planning activities

• Monitoring the supply of fabrics and made ups from suppliers

• Control the production activities

• Develop suppliers for production

• Intimate corrective actions in production functions

• Review the contracts with Chief Executive and arrange production

scheduling

• Authorize to release product for dispatch

• Co-ordinate sample development

• Controlling the stitching activities

• Fixing wages for made ups

• Liaise with suppliers regarding the production of made ups/ garments

IMK ADOOR Page 34

 • Interact and give required instructions to the supervisors/asst. Supervisors
regarding production/dispatch

• Monitor and arrange transportation of raw materials to company

SAMPLE DEVELOPMENT PROCESS

Developing sample according to the order of buyer is an important

function of PPC department. The purpose is to validate, develop verify and
control the changes in sample. Samples are developed with the help of designs
given by designers of the company including foreign designers.

CONTRACT REVIEW PROCESS

The purpose is to determine the requirement of the consumers, review of

requirement of the consumers, review of requirements of effective customer
communication and to ensure complete customer satisfaction.

PRODUCTION PROCESS
YARN BOILING

Yarn boiling is the first step involved in the production process of fabric.
Yarn is the main raw material used for the production of textile item. Company
purchases these yarns from suppliers in Tamil Nadu. Boiling is doing to get
dried yarn without moistures. For boiling the yarn company uses chemicals
along with water.

BLEACHING

Bleaching the yarn is next process in textile manufacturing. Boiled yarn

bleaches thoroughly before they are given for dyeing. It is the process of
whitening the yarn. Bleaching is usually done in bleaching tanks. Before
bleaching the yarn these tanks should wash thoroughly with fresh water and
then prepare the bleaching tank by pouring water and required quantity of
hydrogen peroxide liquor and stabilizer soda ash and caustic soda.

IMK ADOOR Page 35

PACKING
STITCHING
DYEING

Dyeing is the process of colouring the yarn according to the requirement of

customers. There are mainly two types of dyes are using for this purpose,
ordinary dyes and reactive dyes. Ordinary dyes take more time to get the
required colour. Reactive dyes give immediate results at the time of dyeing
itself.

WARP WINDING

Warp winding is the operation of winding the warp yarn into a beam in
suitable arrangement for using as the warp in the loom.

WEFT WINDING

Weft winding refers to winding or reeling of weft yarns. Weft are threads that
are woven under and over the threads that are held on a loom- a frame or
machine for weaving fabric.

WARPING

Unlike table and floor looms, the warp weighted loom does not have treadle-
operated movable sheds and heddles. It is operated with a fixed shed and three
shed sticks with hand-tied string heddles. A weaver weaves from the bottom to
top, rolling the finished fabric around the top beam as he goes.

JOINING

It is the process of joining the threads.

WEAVING

Weaving is done by intersecting the longitudinal threads, the warp, i.e. that
which is thrown across, with the transverse threads, the weft that which is
woven.

INSPECTION

After weaving, the inspection of cloth starts. If there is any defect that is
found and rectified in this stage.

STITCHING

IMK ADOOR Page 36

 After the inspections of cloth these cloths are transferred to the stitching
wing were cloths are cut and stitch according to the order of customers.

PACKING

After stitching the cloth products are packed for exporting.

DEPARTMENT HIERARCHY

CHIEF EXECUTIVE

MANAGER PPC

SUPERVISOR SUPERVISOR SUPERVISOR

Production I Production II Production III

Asst. SUPERVISOR Asst. SUPERVISOR

Asst. SUPERVISOR
SAMPLE STORES& STOCK
STITCHING

DYEING Asst. WEAVING asst.

MANAGER PPC

He is responsible for major policy decisions regarding production.

SUPERVISOR I

He is responsible for developing new samples and designs.

SUPERVISOR II

He is mainly responsible for maintaining the stock records for the fabrics
and made ups. He is also responsible for planning and controlling production
activities of the organisation.

SUPERVISOR III

IMK ADOOR Page 37

 He is responsible for controlling the stitching and allied activities.

DYEING ANDWEAVING DEPARTMENT

Weaving and dyeing is an important part of the production of textiles.
Mascot industries have separate ‘dye house’ and ‘weaving house’ at
Kulappuram.

FUNCTIONS OF DYEING AND WEAVING DEPARTMENT

Following are the major functions of the department

• After getting information from the merchandising team, this department

selects the dye and passes it on to the supervisors

• Checks the quality of dye

• Inspection of raw materials and accessories

• Production monitoring and sample monitoring

• Ensure quality of finished goods.

DEPARTMENT HIERARCHY
CHIEF EXECUTIVE

MANAGER
DYEING&WEAVING

DYEING SUPERVISOR WEAVING

SUPERVISOR

IMK ADOOR Page 38

MANAGER DYEING AND WEAVING

He is in charge of company’s Kulapuram unit and responsible for policy

decisions regarding the department.

DYEING SUPERVISOR

He is responsible for planning the production in dyeing department.

WEAVING SUPERVISOR

He is responsible for planning the production in weaving department.

EXPORT AND MARKETING DEPARTMENT

The major business of Mascot industries is export of home textiles, made ups
and fabrics. Marketing department is an important department of every
organisation. The major function of this department is to co- ordinate the sales
activities of the firm and formulates marketing strategies. At mascot Industries
export and marketing departments comes under one department called export
department.

FUNCTIONS OF EXPORT DEPARTMENT

• Takes care of export shipment.

• Takes care of export licence, its renewal etc.

• Ensure merchandised shipment is as per the requirements of the

customers.

• Ensure shipments are in right time and delay is avoided.

• Ensure pre and post shipment document are accurate.

• Finding new potential buyers.

• Pitch the product.

• Expanding the market.

• Looks for LC (letter of credit) buyers.

IMK ADOOR Page 39

 • Marketing the brand, quality control etc.

• Deciding about the pricing policy and terms of export.

• Preparation of customer record cards.

• Scrutiny and recording of reports.

• Apply for government enhancing regarding exports.

• Responsible for advertisement and sales promotion programmes.

• Co-ordinate activities concerned with external agencies.

• Ensure quality assurance functions are properly implemented as per the

plan.

• Communicate the customer requirements throughout the organisation.

• Liaise with external agencies in matters related to Quality Assurance

Programmes.

• Developing marketing strategies of the firm.

• Send the documents related to the export such as Bill of Lading, to

importer’s bank as per the requirements of buyer.

• Apply for Certificate of Origin which is to be sent to the buyer.

• Take insurance for the products to be exported if buyer specified so.

• Make contacts with the foreign designers.

• Continuous follow up until the product reaches in the hands of buyer.

• Participate in the international textiles fares conducted in different

countries.

MARKETING STRATEGIES

The marketing strategy which is followed is niche marketing. Under this

method a particular group of customers is concentrated and given special
importance. The marketing programme is much focused. These markets are
chosen looking into the viability and affordability.

IMK ADOOR Page 40

SALES PROMOTION

Sustaining current markets and entering new market is a very challenging

task of export and marketing department. New design trends, colour themes and
styles that are acceptable to overseas customers have to be developed and
presented to attract orders. To help the company in latest design creations,
blending the new colour themes Company has foreign designers. Foreign
designers are those people who will study and analyse the changing trends in
the tastes of the consumer regarding the textiles and develops designs
according to the new tastes of the consumer and send these designs to the
company. Company will receive designs from these foreign designers and pay
them royalty if their design creates sales for the company. Mascot Industries
have foreign designers in countries like Malaysia, Switzerland etc.

However, speaking about sales promotion techniques there have been no

concentrated efforts to advertise their products till now. The Company heavily
depends on the direct selling approach. This is one of the best methods of this
industry. The most important factor contributing to the success of the
company’s product remains Word Of Mouth reference. Good reference comes
from providing quality products and reliable service to new customers. Loyal
and satisfied customers will often recommend the products to potential
customers. It is on this foundation Mascot Industries built its reputation over
years. For the last 5 years company is taking helps from agencies in selling their
product. These agencies may be Indian or foreign agencies. These agencies help
the company to get new buyers. These agencies charge a fixed percentage of
commission on selling price. 7.5% is the international standard.

Displaying the latest product range at International Textile and lifestyle

fair helps the company to get the attention of new buyers. Existing buyers also
get the opportunity to select and plan their future programmes based on
company’s display at fair.

COMPETITORS

Just like any other business textile business has also competition.
Company has to compete with the products of various other companies.
Products from India has greater demand in the foreign market hence usually
company has to compete with Indian companies especially companies from
kannur. The major competitors of the company are

IMK ADOOR Page 41

 • Ambadi exporters

• Vasulal exporters

• Cannanore textiles

• Kairali handlooms

• Hindustan textiles

• Dhanalakshmi exporters

PRICING

Company adopts cost plus pricing system. Freight cost may or may not
involve in the price of the product. It will depend upon the order of the buyer.
Usually buyers are adopting anyone of the following four methods.

• Free On Board (FOB)

• Cost, Insurance and Freight(CIF)

• Cost and Freight(CF)

• Cost and Insurance(CI)

Free On Board

Under this method company should bear all the expenses which may
incur until the packaged products reaches the port. All
expenses thereafter will be met by the buyer. (Fright charges). Here company
includes the cost of sending products to the port in the price of the product.

Cost Insurance and Freight

Under this method company will have to bear all the cost starting from
the production till the product reaches to the customer including insurance. The
company will charge all these costs in the price of the product.

Cost and Freight

IMK ADOOR Page 42

 Under this method company should bear all the costs until the product
reaches in the hands of the customer except insurance charges. Insurance
charges will be met by the customer.

Cost and Insurance

Under this method company will have to bear cost of insurance and cost
until boarding. All expenses thereafter will be met by the customer.

NEGOTIABLE INSTRUMENTS USED BY THE COMPANY

Mascot Industries mainly uses two types of Negotiable instruments for

receiving cash met. All payments are done between the exporter’s bank and
importer’s bank. The major methods are:

• Letter of Credit

• Document against payment or Cash against documents

Letter of Credit

A standard, commercial ‘Letter Of Credit’ is a document issued mostly

by a financial institution, used primarily in trade finance, which may usually
provides an irrevocable payment understanding. The ‘Letter of Credit’ can also
be the source payment for transactions, meaning that redeeming the letter of
credit will pay an exporter. ‘Letter of Credit’ is used primarily in international
trade transactions of significant value, for deals between a supplier in one
country and a customer in another country.

Documents Against Payment or Cash Against Document

Cash against Payment is a type of transactions in which the title for the
title for purchased goods is released to the buyer after the total sales price is
paid using cash. Often, a commission house or a similar financial institution
upon verification of the cash payment handles the actual transfer of title. Usage
of the ‘Cash against Document’ method is commonly employed with
transactions that involve the purchase of exports.

IMPORTANT DOCUMENTS REGARDING EXPORTS

Bill of Lading

IMK ADOOR Page 43

 A ‘Bill of Lading’ is a document issued by a carrier to shipper,
acknowledging that specified goods have been received on boards as cargo for
conveyance to a named place for delivery to the consignee who is usually
identified.

Certificate of Origin

Usually buyers will request to enclose Certificate of Origin along with

other documents. It is a certificate issued by Textile department which specifies
the products are produced from India. This document is very useful in order to
avoid double taxation.

EXIM CODE

Export import Code is a code which is issued by the Director

General of Foreign Trade. This code is useful in customs clearance. Customs
can collect details regarding the exporter by using this code.

DEPARTMENT HIERARCHY

CHIEF EXECUTIVE

EXPORT MANAGER

EXPORT ASSISTANT-I EXPORT ASSISTANT-II

IMK ADOOR Page 44

EXPORT MANAGER

Export manager is one who is responsible for the major functions related
to the export of goods to the buyer. He will be assisted by to export assistants.

EXPORT ASSISTANT-I (Documentation)

He is responsible for preparing and sending all the documents regarding

exports.

EXPORT ASSISTANT- II

He is responsible for activities such as communicating with agencies,

buyers etc.

CURRENT EXPORT PERFORMANCE OF THE COMPANY

(Sales in years )

(In Rs.)

Country 2006-2007 2007-2008 2008-2009

Australia 250,00,000 3,13,00,000 3,25,00,000

Switzerland 58,00,000 62,00,000 1,25,00,000

Germany 57,00,000 68,00,000 1,33,00,000

UK 20,00,000 57,00,000 70,00,000

Japan 47,00,000 54,00,000 35,00,000

Denmark NA 17,00,000 40,15,000

Malaysia 24,00,000 27,10,000 20,15,000

Luxemburg 14,30,000 19,85,000 32,20,000

France 53,00,000 76,00,000 80,00,000

IMK ADOOR Page 45

 CUSTOMER CARE DEPARTMENT
Customer satisfaction is an important aim of every business organisation.
Without the support of good customer base a business cannot survive for long
time. Mascot is engaged in a kind of business where goods are produced in
accordance with the order and design of customers. In order to protect the
interest of customers Mascot Industries has set up a customer care department
with a customer care officer.

FUNCTIONS OF CUSTOMER CARE DEPARTMENT

• Co-ordinate with customer for information flow regarding

sample/shipments

• Co-ordinate with HOD in communicating and meeting customer

requirements

• Co-ordinate with CE in updating customer cares

• To ensure proper information of customer’s needs to various departments

• To strictly give conformation of dispatch date for both samples and

orders

• To participate in production monitoring, sample monitoring, to ensure

that confirmed dispatch date are being properly adhered

• To attend phone calls of buyers/customers

• To reply to mails from buyer/customer

• Co-ordinate activities concerned with external agencies

• Ensure Quality Assurance functions are properly implemented as per the

plan

• Communicate the customer requirement throughout the organisation

• Negotiate with external agencies in matter with quality maintenance

IMK ADOOR Page 46

MEASUREMENT OF SATISFACTION LEVEL OF CUSTOMER

Customer satisfaction is being one of the prime concerns of the company.

The satisfaction level was measured in the following ways.

• Company has developed a customer satisfaction feedback form and has

forwarded the same to customer.

• In the absence of receipt of customer feedback , company analyses the

volume of business done by the same customer.

• Number of repeat orders given by the customer.

• Number of claims arrived at of customer compliance.

• Customer’s response to the company’s willingness to settle the customer

complaints.

• Corrective action proposed on the company to eliminate the recurrence of

such complaint.

CUSTOMER SATISFACTION INDEX

• Customer feedback form from the preceding six months were compared
with the current feedback and any increase in rating as considered as
enhanced customer satisfaction .

• If the volume of business over a period is increasing under normal

business environment from the same customer, then the customer
satisfaction is considered to be improving.

• Repeat orders from the customer are considered as an enhancement of

customer satisfaction.

CUSTOMER COMPLAINTS REDRESSEL

Company is redressing the complaints from customers in a very

significant manner. Following are the steps for rectifying customer complaints

• After receiving complaints from customers, customer care officer conduct

preliminary investigation of the complaints given by the customer.

IMK ADOOR Page 47

 • Customer care officer find out the department concerned for the
complaint.

• Then CCO will analyse the complaint with department heads Quality
Assurance Officer and find out the causes.

• After finding out the root causes of the complaints, remedial measures
will be taken.

• After resolving the problem customer care officer will inform the Chief
Executive about the complaints and measures taken to rectify those
complaints.

DEPARTMENT HIERARCHY

Chief Executive

Customer Care Officer

Customer Care Assistant

CUSTOMER CARE OFFICER

He is responsible for dealing with customers regarding the complaints.

IMK ADOOR Page 48

CUSTOMER CARE ASSISTANT

He is responsible for communicating about the complaints given by customers

within the organisation.

CHAPTER-5

IMK ADOOR Page 49

 COMPETITION ANALYSIS

PORTER’S FIVE FORCES MODEL

The model of pure competition implies that risk-adjusted rates of return
should be constant across firms and industries. However, numerous economic
studies have affirmed that different industries can sustain different levels of
profitability; part of this difference is explained by industry structure. Michael
Porter provided a framework that models an industry as being influenced by
five forces. The strategic business manager seeking to develop an edge over
rival firms can use this model to better understand the industry context in which
the firm operates.

IMK ADOOR Page 50

I. RIVALRY

In the traditional economic model, competition among rival firms drives

profits to zero. But competition is not perfect and firms are not unsophisticated
passive price takers. Rather, firms strive for a competitive advantage over their
rivals. The intensity of rivalry among firms varies across industries, and
strategic analysts are interested in these differences.

II. THREAT OF SUBSTITUTES

In Porter's model, substitute products refer to products in other industries.

To the economist, a threat of substitutes exists when a product's demand is
affected by the price change of a substitute product. A product's price
elasticity is affected by substitute products - as more substitutes become
available, the demand becomes more elastic since customers have more

IMK ADOOR Page 51

alternatives. A close substitute product constrains the ability of firms in an
industry to raise prices.

III. BARGAINING POWER OF BUYER

The power of buyers is the impact that customers have on a producing

industry. In general, when buyer power is strong, the relationship to the
producing industry is near to what an economist terms a monopsony - a market
in which there are many suppliers and one buyer. Under such market conditions,
the buyer sets the price. In reality few pure monopsonies exist, but frequently
there is some asymmetry between a producing industry and buyers.

IV. BARGAINING POWER OF SUPPLIERS

A producing industry requires raw materials - labour, components, and

other supplies. This requirement leads to buyer-supplier relationships between
the industry and the firms that provide it the raw materials used to create
products. Suppliers, if powerful, can exert an influence on the producing
industry, such as selling raw materials at a high price to capture some of the
industry's profits.

V.THREAT OF NEW ENTRANTS

It is not only incumbent rivals that pose a threat to firms in an industry;

the possibility that new firms may enter the industry also affects competition. In
theory, any firm should be able to enter and exit a market, and if free entry and
exit exists, then profits always should be nominal. In reality, however,
industries possess characteristics that protect the high profit levels of firms in
the market and inhibit additional rivals from entering the market.

PORTER’S FIVE FORCES MODEL IN TEXTILE INDUSTRY

IMK ADOOR Page 52

I .RIVALRY AMONG CURRENT COMPETITORS

Textile exporters have to face competition both from Indian and foreign
companies. In textile industry rivalry among current competitors are very high.
In textile industry two kind of competition have to be faced by the company,
one from internal companies and the other from external companies. Mascot
industries have to compete with companies from other state who are producing
goods of similar look. Competition from foreign companies is less compared to
other industry because Indian textiles have greater demand in foreign countries.
Foreign company’s products are marketed with their label so problem of
similarity in product does not exist. In short there is very high rivalry among
current competitors in textile industry.

II. THREAT OF SUBSTITUTES

There are no close substitutes for textiles. Mascot Industries are mainly
producing handloom garments. Mascot has to face threat from power loom
garments. In earlier period (until 31-dec-2004) there was high demand for
handloom products. This is mainly because importers are getting duty benefits
from their country in the case of handloom products compared to power loom
products. From 1-01-2005 importing countries have taken away this duty
benefits. After that foreign buyers are not specifying handlooms. Only what
they want is goods of good quality at affordable price within time. So Mascot
has to face threat from power loom companies who are producing goods of
good quality.

III. BARGAINING POWER OF SUPPLIERS

Mascot Industries have a lot of suppliers for yarn, dyes and chemicals.
Mascot is purchasing yarn mainly from companies in Tamil Nadu. They are
purchasing dyes and chemicals from companies in Gujarat. In the case of textile

IMK ADOOR Page 53

industries the suppliers of raw materials have greater bargaining power. These
suppliers will lobby together and increase the price of raw materials during
seasons. This makes a lot of problem in the industry. So collective bargaining
power of suppliers is very high in the case of textile industry. In order to avoid
this problem central government has started spinning mill under National
Textiles Corporation exclusively for exporters in kannur. In the initial period
they supplied raw materials to exporters in kannur, after that they stopped
supplying raw materials to exporters in kannur and they started supplying raw
materials to companies from other states which they are continuing till now. In
short in textile industry there is high bargaining power for suppliers.

IV. BARGAINING POWER OF BUYER

As in the case of suppliers buyers have also very high bargaining power
in this textile industry. What is happening in textile industry is that buyers are
getting various options. He can choose from different options. Buyers are
usually attending almost all Textile fairs.so they gets options from different
companies to purchase goods. It makes a tendency among him to bargain for
lesser price.

V .THREAT FROM NEW ENTRANTS

Threat from new entrants is very high in the case of textile exporting.
Almost all supportive manufacturers are trying to get foreign orders. Once they
get foreign orders they have entered into the industry. The survival in the
industry will depend upon timely delivery of quality products at affordable cost.
In the mid 90s co-operative textile manufacturers are entered in the exporting
market with the help of government. But they failed to provide goods at good
quality within time and their orders have delayed and now they are out from
exporting market. But still there is threat from new entrants.
IMK ADOOR Page 54
 CHAPTER-6

IMK ADOOR Page 55

 SWOT ANALYSIS

SWOT ANALYSIS OF MASCOT INDUSTRIES

STRENGTHS

A firm's strengths are its resources and capabilities that can be used as a
basis for developing a competitive advantage. Following are the strengths of
Mascot Industries.

• Legacy of 70 years in textile manufacturing

• Foreign designers

• High reputation in foreign countries

IMK ADOOR Page 56

 • ISO Certification

• BSCI approval

• Combination of traditional weaving and modern technology

• Computerized sampling development and computerized embroidery

machines

• Availability of skilled manpower

• Company has a cotton mill which provides yarn to the company

• Recognized export house of government of India

WEAKNESSES

Following points can be considered as weaknesses.

• Location of the company is in a very rural area in kannur which leads to

high transportation cost

• Lower concentration on power loom

• Company is not using modern technology properly still they are

depending traditional machineries which leads to lower productivity

• Lack of skilled manpower

• Highly depended on cotton

• Highly concentrated on export marketing, no domestic marketing

OPPURTUNITIES

IMK ADOOR Page 57

The external environmental analysis may reveal certain new opportunities for
profit and growth. Following are the opportunities available for Mascot
industries.

• Growth rate of domestic textile industry is 6-8 % per annum.

• Large, potential domestic and international market
• Product development and diversification to cater global needs
• Elimination of quota restriction lads to greater market development
• Market is gradually shifting towards branded readymade garment and
there is greater opportunity if the garments are branded
• Increased disposable income and purchasing power of Indian customers
open a new domestic market development
• Emerging retail industry and malls provide huge opportunities for the
apparel, handicraft and other segments of the industry
• Proposed ‘Azhikal Port’ is a great opportunity for the company to
increase its export with minimum cost
• Proposed power loom factory at Nadukani Kinfra Textile Centre gives
high opportunity to play in the power loom sector
• Declaration of Kannur as the ‘Town of Export Excellence’ gives more
government assistance companies in Kannur.

THREATS

Changes in the external environmental also may present threats to the firm.
Following are the threats.

• Competition from other developing countries, especially china.

• Continuous quality improvement is need of the hour as there are different
demand patterns all over the world.

IMK ADOOR Page 58

 • Elimination of quota system will lead to fluctuations in export demand.
• Threat for traditional market for power loom and handloom products and
forcing them for product diversification.
• International labour and environmental laws
• Geographical disadvantages.
• To balance the demand and supply.
• Continuous effort of supportive manufacturers to enter into export
business.
• Make balance between price and quality.
• Similar nature products from other states of the country at lower cost.
• Growing unionism among employees.

IMK ADOOR Page 59

 CHAPTER-7

FINDINGS OF THE
STUDY

FINDINGS

IMK ADOOR Page 60

 1. One of the leading quality textile exporters in Kannur.

2. Company adopts both direct and indirect sales.

3. The company mainly produces products by using handlooms.

4. Company’s Kulappuram unit is running in loss due to unionism among

employees.

5. Company is planning to start a power loom factory at Kinfra Textile

Centre, Nadukani.

6. Company is using foreign designers to get designs according to the new

trends in foreign countries.

7. Company has closed down their units at Quilon and Trivandrum.

8. No individual performance appraisal system.

IMK ADOOR Page 61

 SUGGESTIONS

1. The company should increase the production to meet the demand of

customers.

2. Company should increase the commission of agents to get more orders.

3. Company should participate in more textile fairs to get advantage.

4. Company should focus in power loom sector.

5. Company should start business in domestic market.

6. Company should concentrate more on the development of employees.

IMK ADOOR Page 62

 CONCLUSION

The unique feature of this organisation is that they ultimately aim at the
satisfaction of consumer needs. Its stress is always on business and their
products. Their marketing techniques are directed towards the satisfaction
consumers. They really take care of quality of their product and they deliver
what they promise.

A wrong choice of product or poor design of product may render thir

system operations ineffective and non competitive. A careful evaluation must be
done as it is a competitive field. They take care of their product selection and
design, process selection and planning facilities, location etc. They also look
after their quality assurance work and devise methods for design cost reduction
and cost control.

Customers are the central point of any business and the success of the
business lies in the hands of customers and in the number of customers. Regular
customer feedback is encouraged by the company to understand the views of
their customers which enable them to assess and improve their performance.
They understand the customers so well that their product fits them and sells by
itself.

By exhibiting latest products and designs at international fairs, they create

new buyers by entering into new markets. The views and ideas of these fairs
help them to design new products to satisfy the needs of people in various
countries. The company now has their business in around 15 countries and they
achieve their goals by meeting the customer needs. Their marketing activities
start and end with customers. The management team of this organisation is

IMK ADOOR Page 63

designed to face any challenges and unforeseen circumstances that may come
their way.

The success of creating a winning corporation lies in the appreciation of

the potential value of human capital and in the ability of the leaders of the
company to nurture and mobilize such talents. The management of Mascot
Industries put their entrepreneurial mind to create a livelihood for their
customers while achieving their own goal also.

IMK ADOOR Page 64

 Bibliography
 www.wikipedia.com

 www.mascotinds.com

 www.quickmba.com

IMK ADOOR Page 65