Arvind Mills PPC Overview

7/22/2019 Arvind Mills PPC Overview

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Production Planning and Contr

Arvind Mills L

Ananda Dasgupta (D0Narasimha Irukuvarjula (D0

Ninad Lele (D0Sudeep Ojha (D0

Srinivas PV (D0


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Indian Textile Industry Overview 2

Textile sector contributes 14% to industrial production and 4% to GDP

Accounts for 17% of export earnings

Provides direct employment to over 35 million people

Projected to increase its textile share from its current 4.5% to 8% by 2

Potential size of Indian textile industry is expected to reach US$ 221 billion


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Opportunities in Textile

The textile industry has witnessed a sharp increase in investment duryears

The industry attracted FDI worth $1.04 billion from 2000 till Novemb

The textiles industry complements the growth of several institutions asuch as defense forces, railways and government hospitals who are ke

This market is likely to grow to $31 billion by 2020 with a CAGR of 10

The 11thFive Year Plan outlay for textiles has been fixed at $2.91 Billiofrom the 10thFive Year Plan outlay of $0.74 Billion


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Value Chain In The Textile Industr


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Arvind Mills Ltd.Founded in 1931 with the aim of manufacturing the high-end superfine fabrics

Worlds largest denim producer at 110 million meters per annum

13% market in India

50% market share in leading domestic and international brands

License Brands Arrow , US Polo, Gant, Nautica, Izod, Elle, Hanes, EdHardy

Retail Brands

Debenhams, Next, Megamart, Arvind Store, Club America

JV

Tommy Hilfiger

Owned Brands

Flying Machine, Excalibur, Newport University, Ruggers, Colt, Karigari

Domestic and international brands manufactured and sold by Arvind Brands and Reta


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Business Strategy

Purchase Domestic and international brands licenses

(to manufacture, market and sell in India)

Building several Power brands, while leveraging thestrengths of developing other brands

Strong supply chain and logistics practices

Build its own retail chain (MegaMart) while increasingreach to expand growth brands


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Forecasting

Forecast

BidsResults

BranchSalesHistorical Sales

DataHorizon

offorecast

Experts

Forecast

Multiple RegressionAnalysis

ExtrapolativeForecasting

Reports Cont1. Forecast 2. Compara3. Graphical

of Short, Range Fo


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Product Flow


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Information Flow


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PROCESS DIAGRAM


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CHALLENGES IN PRODUCTION PLAN

Bargaining power of consumers

Rapidly changing styles

Shorter lead times - sources of competitive a

Fragmented and informal industry


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PRODUCTION PLANNING AT Arvind M

Not Approved

Buyer requirements DesignGoes to the customer

for approvalg

Planning of workRouting and schedulingQuality Control

Production Planning and Control


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Sampling Process at Arvind Mills

Two types of samples Solid Color and printing

Quality Measures while sampling

Chemical Lab for research work and ensuring quality of the cloth

Prototype of manufacturing process carried inside the lab

Physical lab for checking the physical properties of the material


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MANUFACTURING PROCESS AT Arvind M


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Manufacturing Process at Arvind Mil


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Production Planning and Control at Arvind

Mills

Production planning Production control

Functions

Planning

Routing

Scheduling

Loading

Dispatching

Following Up

Inspection

PRODUCTION PLANNING AND CONTROArvind Mills


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KEY PERFORMANCE INDICATORSArvind Mills

Delivery on Time

Productivity Improvement

Improvement of Equipment Efficiency

Reduce WIP

Reduce Overheads

Reduce Obsolescence

Improving the Bottleneck Stages


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ERP IN ARVIND MILLS

Planning

Scheduling

Inventory Control

Production

Costing

Order Code Generattion

Shop Floor Management

Inspection of Raw Material and Finished Products

Purchasing

Generating Bill of Materials for Specific orders


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Material Requirement Planning


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Optimized Production Technolog


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Job allocation and scheduling sheet


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Controlling For Production Deviatio

Made-to-order production

Constant demand year-on-year

Majority customers are international players ~ 90%

Fixed seasonal demand cycle

Stringent quality specifications

Local customer base ~ 10%

No fashion cycle

Small order size

Relaxed quality specifications


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Controlling For Production Deviatio

Two types of production deviations

Problems in production at a plant

Balance job transferred to another plant

Vendor default

Identifying back-up vendor through Vendor ManagedSystem

S l Ch i P bl


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Supply Chain ProblemForward Logistics

ArvindWarehouse/Storage areaDistribution centersIndependent

Weak points

Quality of forecast is not reliable for independent retailers

Bullwhip effect a major constraint in forecasting

Transportation to independent retailers for DSD (Direct Store Delivery) is

Labour Intensive

Orders are mix of different sizes, colours and quality

Inaccurate inventory due to theft at warehouse and DC

Reverse Logistics CustomersIndependent RetailersDCArvind

Weak points

Discrepancy between physical flow of the back order and the inventorymanagement system

Difficulty in tracking the back orders


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INTEGRATING VENDORS IN PPC

Types of Vendors

Bulk OrderVendors

(Arvind Brands)

Specialty

RequirementSuppliers

(low volume)


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INTEGRATING VENDORS IN PPC

Database of all vendors in ERP

Order Placement, Product Receipt done locally at ea

Process Monitored by HQ team at Mumbai

High Production Volumes


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Recommendations

Use of demand-forecasting for timely procurement of yarn

Implementing PPC at Fabric making unit in order to remove idle timmanpower constraints

Implement Vendor managed inventory model to cope with excessivinventory issues at DC (counter bullwhip effect)

Implementation of RFID to control theft at the warehouse and DC l

Arvind Mills PPC Overview

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