CPP Assignment Rough
CPP Assignment Rough
Abstract
A lead time is the latency between the initiation and execution of a
process. In apparel industry, lead time is the total amount of time required
for completing a product beginning from the date of receiving the order to
the shipment of the goods to customer. Time is a great issue in apparel trade
as orders are based on weather, seasons and occasions. Lead time hence,
carries huge importance when delivering the products to the respective
outlets is concerned. Bangladesh, though the second largest exporter of
readymade apparel to the world, still to prevail the on-time issues. The study
commenced with the identification of back-locks affecting the lead time in
the apparel industry. A three step strategy is proposed through this study to
ensure a shorter lead time.
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Literature review
Concept of Lead Time
As it is said, it is the amount of time required to complete a service, a
production lot or an order. Lead time is inter-related with the other
production management support tools.
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order (if you buy an item) or create a job (if you manufacture an
item) from the time you learn of the requirement.
• Processing Lead Time: It is the time required to procure or
manufacture an item.
• Post processing Lead Time: It represents the time to make a
purchased item available in inventory from the time you receive it
(including quarantine, inspection, etc.)
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Figure 1: A Typical Order Processing and Execution System for knit apparel industry
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Figure 1: A Typical Order Processing and Execution System for woven apparel industry
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Methodology
A portrayal of the total lead time management in Bangladesh’s
readymade apparel industry required intensive interviews of concerned
personnel in different departments. Secondary data were accumulated from
different international and local research reports. Real time information was
collected from renowned apparel sourcing companies in Bangladesh.
Interviews were taken from industry people who have been working for
years in the apparel trade. Opinions from the government policy makers and
concerned authorities like Bangladesh Garments Manufacturer and Exporters
Association (BGMEA), Bangladesh Association of Exporters (BAE) were
cross checked to verify authenticity and realism of the collected secondary
data. A survey on 15 readymade apparel industries in the two garments
clusters, Gazipur and Narayanganj of Dhaka city and Chittagong (port city)
were helpful to reveal the problematic areas behind the prolonged lead time.
Expert’s comments were also taken in formulating a strategic way-out from
the problematic areas.
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Figure 1: Gantt chart for a typical apparel industry with a lead time of 90 days
PDM 1 4 11
Approval 5 13 111
Booking 9 34 111111111
Fit sample 13 27 11111
Inhousing 30 69 1111111111111
PP sample 49 55 111
PP & Trim 56 62 11
Carton 59 67 111
Wash (For Denim) 59 67 111
Vessel 63 70 111
Bulk 70 86 111111
Shipment 77 90 1111
Development Stage
This area comprises the order reception to the in-housing of raw
materials and accessories. The obstacles in this section mainly cycles
through backward linkages and buyer order processing systems.
Backward Linkage
Backward linkage industry is said to be the industry who supplies the
raw materials to readymade apparel industry i.e. the primary textile industry
and the accessories industry. Bangladesh has gained enough reputation for
knit fabrics as most of buyers are relying on local knit fabrics to produce
their apparel products from Bangladeshi apparel industries. More than
thousands of knit composite apparel industry is functioning delivering final
products within around 90 days whereas the average lead time in the apparel
industries are more than 110 days. The international standard though is far
better. The apparel industries that do not have their own backward link
industry have to source fabrics from local or foreign producers which
requires an extended lead time. Fabric import is a lengthy process and on
average takes up to 60 days.1 In the woven sector where more than 90% of
fabric is sourced from mainly China requires a lead time of around 120 days
to ship the end product. In figure 1 the Gantt chart for a typical apparel
industry shows that, in-housing the materials takes up to 40 days of the 90
1
Data taken from Bangladesh Garments Manufacturers and Exporters
Association (BGMEA) Research Cell
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days of the lead time that is 45% of the total time.China in other hand do not
comprise the burden of importing fabrics as they are rich in in-house textile
solution, can ship the end product within a lead time of only 30 days.
Type of Industry Average Lead Time
Knit Composite Industry 70-90
Knit Apparel Industry 90-110
Woven Apparel Industry 120
2
Table 1: Average Lead Time for different types of industry
Buying Behavior
As an important hub for apparel sourcing, most of the apparel buyers
of the world have a buying office here or carry out buying through middle-
retailers. Buyer’s buying behavior is also identified as one of the reasons
behind prolonged lead time. Manufacturers have limited access to current
market intelligence and information on international apparel trade trends.
There is no specific indication from the local buying offices to the
manufacturers about the next season’s fashion. In most of the cases there is
not any opportunity for the manufacturer to plan in advance for fabric and
accessories.
Even the local buying offices are not the ultimate decision makers
and approvals had to be taken on various stages of production like fit sample
approval, pre-production sample approval, design approval, wash approval
etc. from the headquarters. Samples are sent by air to the respective head
offices and it takes much time. On various occasions, the buyer’s authorized
approval person is not available immediately. These problems delay the
decisions to be made by the buyer and add some undesired days in the lead
time. Approval process is lengthy and consumes around 10% of the total lead
time. If the local buying officers were given the authority to approve
samples, approval process could have been completed within 2 to 3 days
whereas it takes 10 to 15 days now. Cases are also common when sudden
changes in style, color or shade are regulated in the middle of the production
which requires new planning, new material requirement and sourcing and
new work study; leads to prolonged lead time.
Strategic sales forecasting of the renowned fashion brands are done in
such a way that it allows barely any room to the manufacturers. Apparel
brands want to meet the exact customer demand for the upcoming seasons.
They are always in a mad race of showcasing the latest fashion trend in the
market before someone else does. Doing so, they wait until the last moment
to plan for the coming season and these forces them to have a little time on
hand to produce the apparel. The explicit pressure applies to the
manufacturers. They have to do so many things within a little time available.
2
Data imported from own research questionnaire and survey
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Execution Stage
Execution stage refers to the start of bulk production and receiving
the final product. Though it seems as the major stage in an apparel industry,
it only takes 15-20 days for the production of end product if the development
of the order was executed effectively. Problematic areas that consume
avoidable lead time in this stage are shown as followed.
Inefficiency in planning
Planning in the execution stage is the identification of required
manpower and machines to be able to complete the production in least time.
It refers to the process of determining of manpower, equipment and facilities
based on the demand. The four basic manufacturing metrics used in the
industry are Cost, Quality, Lead time and Technical Risk. So, inefficient
planning has a great effect on those four metrics.
Low Productivity
In Bangladesh, workers are available in plenty but lack of skill is still
a big concern here. This yields low productivity when compared with other
competitive countries like China, India, and Pakistan. If China’s productivity
is 100, Bangladesh’s productivity is only 77%. Besides, lack of investment in
new machinery and technologies with current insufficient size of skilled
workforce also impedes an increase in productivity. Unskilled middle
management positions are also a major reason behind the low productivity of
apparel industry. Most of the firms are run by people with no previous
academic background of textiles or apparel. Old-fashioned technology with
non-technical persons is a common phenomenon in the apparel firms.
Other Areas
Bangladesh is a developing country and still weak in infrastructure
compared to international standard. Poor supply of energy and gas, transport
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and port facility which are essential elements of international trade are still
below part. And to add with the political instability, transport of readymade
apparels to the destinations through the port sometimes becomes a lengthy
process.
Weak Infrastructure
Congested roads, limited inland transport alternatives, add
inefficiencies to apparel export lead time. The apparel industry is highly
dependent on the Dhaka-Chittagong highway route as Chittagong sea port is
the main doorway from the country. Most of the apparel industries are Dhaka
and Chittagong. As a result Dhaka-Chittagong route is very important for
apparel export. Currently it is a two lane road with busy traffic and a four-
lane high way is under construction. 280 kilometers of road from Dhaka to
Chittagong sea port takes a day long for a cargo to reach which is really
inefficient. The goods laden vehicles have to stand for hours in the traffic
jam on the way to Chittagong from Dhaka and its adjacent areas due to poor
road facilities. Many apparel exporters complained that they cannot meet the
strict lead-time set by the international buyers due to this.
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a result there are cases where manufacturers seldom miss the agreed lead
time with the buyers.
Immediate solutions
Solutions those can be adopted right now in the apparel industry are
termed as the immediate solutions. These are concerned with the
improvement and modernizing of the current production system and supply
chain management in the apparel industry. Regular training of workers and
application of ergonomics in the production floor should be implemented to
boost productivity. Relation between buyer and manufacturer should be for
long term and more open-oriented. The immediate steps that can reduce lead
time considerably are described below.
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Mid-term solutions
The development of the infrastructure and port facilities is grouped
under mid-term solutions. This is because, to improve infrastructure it is not
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Improvement of infrastructure
Efficient transportation system could reduce the excess time needed
for movement of raw materials and finished products from port to factory
and vice-versa. Government of Bangladesh has undertaken a number of
projects addressing the different transport routes that are being pursued to
help ease the situation. Expansion of the Dhaka-Chittagong highway to four
lanes, prepare long-term efforts to establish a deep-sea port in Chittagong,
improve efficiency at Dhaka airport, and double the train container transport
capacity can certainly help in reducing the lead time.
Political stability
Government of Bangladesh has to be strict about business plans &
regulations. Frequent changes are to be stopped. After deciding a profitable
plan is to be created & that must be followed by all the industries. For the
sake of readymade apparel industry, the country’s most export value earning
industry, strikes should be avoided or at least on emergency export duty
vehicles should be kept free off strikes.
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Conclusion
An extended lead time is one of the major problems that the apparel
sourcing world is facing when exporting readymade apparels from
Bangladesh is concerned. Apparel sourcing bodies are one of the major stake
holders of the readymade apparel trade and they along with the Bangladesh
authorities can endow their investment in improving the factors affecting the
lengthened lead time issue. The prevailing factors behind this are mostly
related to the efficacy of the supply chain and port facility. The major back-
lock in the supply chain is the incomplete support of the primary textile
industries that is supposed to supply the raw materials to the readymade
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