Industry Profile

HISTORY OF TEXTILE INDUSTRY:

The Indian textile industry has a significant presence in the economy as well as in the
international textile economy. Its contribution to the Indian economy is manifested in
terms of its contribution to the industrial production, employment generation and
foreign exchange earnings. It contributes 20 percent of industrial production, 9 percent
of excise collections, and 18 percent of employment in the industrial sector, nearly 20
percent to the countrys total export earning and 4 percent to the Gross Domestic
Product. In human history, past and present can never ignore the importance of textile
in a civilization decisively affecting its destinies, effectively changing its social
scenario. A brief and thoroughly research feature on Indian textile culture.
As we know that Surat city is known as the TEXTILES city, because about 85-95% of
textiles in synthetics of the entire world is produced by Surat, which is why Surat is
one of the top five in the textiles industry. About 35 yrs ago the textiles industry comes
into the Surat with small scale production, but now it is on the fourth or the world in
the manufacturing field on the textiles. most of task of marketing of textiles is done in
the Ahmadabad because all most all the types of cottons are sold and purchased in the
Ahmadabad, so we can say that, Surat is famous for producing the fabrics while,
Ahmadabad is the center for the marketing of all the types of fabrics and all these
textiles or inventories of the fabrics are controls by one very big organization in the
world called STC (Surat textiles corporation)proportion of people is associated with
textiles industry in Surat. So we can understand that the textiles industry is developed
very well in the Surat.

CURRENT POSSITION OF TEXTILE INDUSTRY IN INDIA:

Textile constitutes the single largest industry in India. The exports of textiles and
garments increased from Rs. 455048 Million to Rs. 552424 million, registering a
growth of 21%. Growth in the textile industry in the year 2003-2004 was Rs. 1609
billion. And during 2009-010 production of fabrics touched a peak of 45,378 million
square meters.
In the year 2009-10 up to November, production of fabrics registered a further growth
of 9 percent over the corresponding period of the previous year. With the growing
awareness in the industry of its strengths and weakness and the need for exploiting the
opportunities and averting threats, the government has initiated many policy measures
as follows:

The Technology Mission on Cotton (TMC) was launched in February 2000 to adsarees
issues relating to the core fiber of Cotton like low productivity, contamination,
obsolete ginning and pressing factories, lack of storage facilities and marketing
infrastructure A New Long Term Textiles and Garments Export Entitlement (Quota)
Policies 2008-2009 was announced for a period of five years with effect from 1.1.2008
to 31.12.2009 covering the remaining period of the quota regime.

STRUCTURE OF INDIAS TEXTILE INDUSTRY:

The textile sector in India is one of the worlds largest sectors. The textile industry
today is divided into the following segments:

1. Cotton Textiles
2. Wool Textile
3. Synthetic Textile
4. Silk Textile

All segments have their own place but even today cotton textiles continue to dominate
with 73% share. The structure of the textile industry is extremely complex with the
modern, sophisticated and highly mechanized mill sector on the one hand and hand
spinning and hand weaving (handloom sector) on the other in between falls the
decentralized small scale power loom sector. Unlike other major textile-producing
countries, Indias textile industry is comprised mostly of small-scale, nonintegrated
spinning, weaving, finishing, and apparel-making enterprises.

Composite Mills:
Large-scale mills that integrate spinning, weaving and, sometimes, fabric finishing are
common in other major textile-producing countries. In India, however, these types of
mills now account for about only 3 percent of output in the textile sector.

Spinning:
Spinning is the process of converting cotton or manmade fiber into yarn to be used for
weaving and knitting. This mills chiefly located in North India. Spinning sector is
technology intensive and productivity is affected by the quality of cotton and the
cleaning process used during ginning. Largely due to deregulation beginning in the
mid-2005, spinning is the most consolidated and technically efficient sector in Indias
textile industry.
Weaving and Knitting:
The weaving and knits sector lies at the heart of the industry. In 2008-09, of the total
production from the weaving sector, about 46 percent was cotton cloth, 41 percent was
100% non-cotton including khadi, wool and silk and 13 percent was blended cloth.
Indias weaving and knitting sector remains highly fragmented, small-scale, and laborintensive. This sector consists of about 3.9 million handlooms, 380,000 power loom
enterprises that operate about 1.7 million looms, and just 137,000 looms in the various
composite mills.

 Fabric Finishing:
Fabric finishing (also referred to as processing), which includes dyeing, printing, and
other cloth preparation prior to the manufacture of clothing, is also dominated by a
large number of independent, small-scale enterprises. Overall, about 2,300 processors
are operating in India, including about 2,100 independent units and 200 units that are
integrated with spinning, weaving, or knitting units.
Clothing:
Apparel is produced by about 77,000 small-scale units classified as domestic
manufacturers, manufacturer exporters, and fabricators (subcontractors).

EXPORT AT GLANCE:
A textile export plays a crucial role in the overall exports from India. Textile exports
increased substantially from US$ 5.07 billion in 1991-92 to US$ 12.10 billion during
2000- 01. During the year 2000-01 Indias textile export was US$ 12014.4 million. It
was increased the year 2007-08 US$ 13038.64 million. However, during AprilNovember, 2008, against a target of US$ 15,160 million during 2007-08, the textile
exports were of US$13039 million, registering a shortfall of 14% against the target.
The overall export target for 2008-09 has been fixed at US$ 15,565 million.

Company Profile

INTRODUCTION AND BACKGROUND:

TULSI SYNTEX PVT. LTD. is private limited company. Organization is having 10
years history in the world of textiles industry. The Company was registered under the
companies Act, in the year 2001. Its sales and purchase turnover has got good
responses of the people and society at a large.
The activity of Dyeing and Printing of Art Silk fabrics is on job work basis at 123-124,
G.I.D.C. Pandesara, Surat-394221. The group also has a well proven track record in
the textiles business and financial background. The factory site is located at the
distance of 9.2 kilometers from Surat Railway Station.
Any company or industry must have to select those area, which is not more costly and
easily take raw material from the market. And an important thing for any industry is
that less transport expenses and also reduces wastage of time and money. So the
company or industry can easily deliver their goods or services on the given time to the
customers or buyers. The company is having present existing installed capacity of 160
lakhs meter/ p.a. of Art Silk Fabrics.
The company has now decided to expand its present activity of dyeing and printing of
art silk fabrics. For the purpose of said expansion of the company they have
approached our bank for meeting part of the project cost. Before taking decision for
financing the project, our higher authorities have desired to conduct a detailed
appraisal of the project.

The report has been prepared based on various written and oral information
clarification furnished by the companys management.

ORGANISATION STRUCTURE:
Chairman &
Managing Director
[Mr. Mahavir Jain]

Masters of the
Department

Finance
Department

Marketing
Department

HR
Department

Production
Department

[Mr. Mahavir
Jain]

[Mr. Taliya
Jariwala]

[Mr. Minish
Parikh]

[Mr. Hiren
Pastagiya]

Assistant
Master

Assistant
Master

Assistant
Master

Assistant
Master

Supervisor

Supervisor
Supervisor

Supervisor

Supervisor

Employees

Employees

Employees

Workers

FINANCIAL PERFORMANCES:

Companys financial highlights and financial performance can be measured by its

profits and earnings. Since this way companys yearly profit after taxes is very high
turnover. So we can understand that it is having good profits and earnings. Since profit
maximization is not only the target of the company so it is necessary to consider
wealth and employee satisfaction towards the company. Company is having good
sales; it shows that companys financial performances are sound.

FUTURE PLANS OF EXPANTION:

1.
To increase the investment in the production and tools & technologies related to
2.
3.
4.
5.
6.
7.
8.

that.
To achieve maximum yearly turnover.
To increase the sales.
To create new branches and factories at various other places.
To increase plant layout area by purchasing extra land.
To Increase profits/earnings
Sophistication of technologies.
Improve the production system and to produce attractive sarees in a good
systematic way.

Finance Department

INTRODUCTION OF FINANCE DEPARTMENT:

DEFINITION OF FINANCE:
Finance management means application of managerial techniques like planning,
organizing and controlling to finance function By Earnest Walker

Financial Manage is concerned with the managerial decision that results in the
acquisition and financing of long term and short term credits for the firm. As such it
deals with the situation that required selection of specific asset, the selection of
specific liability as well as the problem of size and growth of an enterprise. The
analysis of this decision is based on the expected inflow and outflow of fund and their
effects upon managerial objectives.
Finance is well-known as the lifeblood of any business. From inception to closure of
any business unit Finance is required. It may be defined as the base on which the
whole business structure depends on the finance. Once the business is started it needs
funds for production of goods and services as well as their distribution. The efficiency
of production and marketing operations is directly influenced by finance. Finance is
the master key which provides all the sources for activities of productions, distribution
etc.
In early years of its evolution it was treated synonymously with the raising of funds.
But in present words of finance management has broad scope and hence included
effective use of resource along with the procurement.

Financial management is that managerial activity which is concerned with the

planning and controlling of the firms financial resources. Finance management is that
part of the management which is mainly concerned with raising funds in the economic
and suitable manner, using these funds as profitably as possible, planning future
operations. Controlling current performance and future developments through
financial account, cost account, budgeting etc.
Finance function is procurement of funds and there effective utilization in the
business. Finance is the taste of providing funds needed by the enterprise on the terms
that are most favorable to it, keeping in view the objective of the enterprise.
The time taken to get the payment from the customer is very important. The collection
period of the company is good. The company has discount offers in order to get the
payments at the earliest. The earlier the receipt, the faster the movement of cash flows.

ACTIVITIES OF FINANACE DEPARTMENT:

Planning & budgeting of financial resources.
To raise finance from the financial resources, by ways of Loans etc. and by issuing
shares.
Issuing financial resources to different department. Working capital managing.
Balance sheet & Annual general prepared. Accounting management.
Cash management.

 ORGANISING STRUCTURE OF FINANCE DEPARTMENT:

IMPORTANCE OF FINANCE:

FA CS A i e s o cns cs smc a ir i os nse pt u t ca au n n t

o A u crt nt nei ce n ta tor gl u n t
OM a S n p f a t a tf e a n i n rc f a tafe g rt
g oe r
10

Finance is a field that studies topics such as borrowing money to receive a greater
return on the funds. Finance is important in business because debt payments often
require paying a lower rate of return than investors expect with other instruments such
as common and preferred stock. Finance allows a company to receive the money
necessary to pay bills such as workers' wages, rent and utilities without giving up
ownership rights through the sale of stocks.
Return Expectations:
Finance includes the study of return expectations. When a company decides to borrow
money, it includes risk in the calculations of the return it will receive. A company that
borrows a million dollars may predict that it has a 50 percent chance of earning two
million dollars with its investment and a 50 percent chance of earning five hundred
dollars. The company averages the two numbers and expects that it will receive a
return of a million and a half dollars.
Risk Averse Investors:
Risk includes the study of variance. If a company can receive a million dollars half the
time, and the other half of the time receives nothing, or it can receive a guarantee that
it will receive five hundred thousand dollars, its financial analysts will usually
recommend that it pursue the option with a guarantee to receive five thousand dollars.
According to New York University, most investors are risk averse, so they will require
additional returns before they accept a decision that includes larger amounts of
potential risk.
The Necessity of Finance:
Finance is necessary for many small businesses. Stock exchanges often require a
minimum share value and company size before a company's shares may trade on the
exchange. Since the small business owner cannot sell shares of a company to the
public, the owner must borrow money from banks and other sources to finance the
expenditures of the small business.
Cash Flow:
Finance includes the study of cash flow. A company must pay its bills as they become
due. This may include temporarily borrowing money at a higher return than the
11

company is earning on its sales if it is necessary for the company to continue

operating. Financial professionals make sure that the company's incoming revenues
match its bill payments, by matching current assets such as cash with current liabilities
such as the amount of bond interest due during the current year.
Cost of Capital:
The cost of capital is an important area of finance. Businesses can often borrow funds
from several sources, such as credit cards at high interest rates and bank loans at lower
rates. Financial calculations provide the rate of return from investing additional funds
into company operations, determining whether it is worthwhile to borrow money from
sources with a specific interest rate.

FUNCTION OF FINANCE:
The five basic corporate finance functions are described as those functions related to:

Raising capital to support company operations and investments (financing

functions).
Selecting those projects based on risk and expected return that are the best use of a
company's resources (capital budgeting functions).
Management of company cash flow and balancing the ratio of debt and equity
financing to maximize company value (financial management function).
Developing a company governance structure to encourage ethical behavior and
actions that serve the best interests of its stockholders (corporate governance
function).

12

 Management of risk exposure to maintain optimum risk-return trade-off that

maximizes shareholder value (risk management function).

CAPITAL STRUCTURE OF TULSI SYNTEX COMPANY:

The capital structure of company is the particular combination of Debt, equity and
other sources of finance that is used to fund its long term financing. The key division
in capital structure is between debt and equity. The proportion of debt funding is
measured by gearing.

SOURCES OF LONG TERM FINANCE:

Definition:
A business requires fund to purchase fixed assets like LAND and BUILLDING,
PLANT and MACHINERY, FURNITURE etc. There assets may be regarded as the
foundation of a business. The capital required for these assets is called FIXED
CAPITAL. A part of the working capital is also of a permanent nature. Funds required
for this part the working capital and for fixed capital are called long term finance.
The TULSI SYNTEX PVT.LTD. has the following sources of long term finance:
E q u ty & P r e f e r n c e S h a r e s

R e t a i n e d E a r n in g s

T e rm L o a n

L o a n s f o r m F i n a n c i a l I n s t it u t i o n s

13

1. Equity & preference shares:

Equity shares are issued to the owners of the company. They have a nominal or face
value. The market value of a companys shares bears no relationship to their nominal
value, except that when equity shares are issued for cash, the issue price must be equal
to or be more than the nominal value of the shares. These shares are risky for the
owners as well as for the company but it also give the highest amount of uncertain
dividend.
Preference shares have a fixed percentage dividend before is paid to the equity
shareholders. As with equity shares a preference dividend can only be paid if sufficient
distributable profit are available, although with cumulative preference shares, the
right to an unpaid dividend is carried forward to later years. The arrears of dividend on
cumulative preference shares must be paid before any dividend is paid to the equity
shareholders.
2. Retained Earnings:
Retained earnings refer to the portion of net income which is retained by the company
rather than distributed to its owners as dividends. Similarly, if the company takes a
loss, then that loss is repainted and called variously retained losses or accumulated
losses. Retained earnings are repotted in the shareholders equity section of the
balance sheet. A complete report of the retained earnings or retained losses is
presented in the statement of retained earnings or statement of retained losses. The
percentage of net earning not paid out as dividends, but retained by the company to be
reinvested in its core business or to pay debt.
3. Term loans:
Team loans carry fixed interest rates and monthly or quarterly repayment schedules
and include a set maturity date. The loan is for over a fixed period. Borrowers under
term loan agreements are normally required to meet minimum working capital and
debt to net worth tests, to limit dividends, and to maintain continuity of management.
4. Loans form financial institutions:
Generally, company takes loans from many financial institutions. These financial
institutions have a fixed rate of interest for the companies; they financially help the
14

companies who require money. These institutions pay huge amounts of money to the
companies for long term and short term.
SOURCES OF SHORT TERM FINANCE:

Definition:
This is considered an external as it is assured that the money lent to the business will
be paid back to the private individual in the future, possibly with an extra amount to
compensate the individual for the help they gave. The decision of returns may depend
upon the amount invested and the decision of the person using their savings.

1.

Trade credit:
It means the credit granted by the supplier of goods and service to buyer. Times
duration is 30-90 days. To the extent of trade credit it reduces the need for raising
working capital, it is financing the inventory. It is a spontaneous source of financial
because it arises out of normal buying transactions as of the firm. No specific

negotiations are needed. The buying firm is considering credit worthy by the supplier.
2. Commercial papers:
It is the short term promissory note sold by highly rated companies for their working
capital needs. It is an issued on discount but payable at face at the time of maturity. It
is an unsecured instrument. There is no limitation on the end use of fund acquired
through commercial papers. They are regulated by reserve bank of India (RBI). It can
be issued for period ranging from 15 days to one year. The minimum size of an issue
is Rs. 25 lakhs and the minimum amount of subscription is Rs. 5 lakhs by an investor.
15

3. Bank finance:
They are the most important source of short term fund to industrial enter prices.
Commercial banks provide a greater part of working capital to business enterprises.
Majority of Indian enterprises rely on commercial banks to meet their working capital
requirements.
4. Certificate of deposit:
These are issued by bank acknowledging fixed deposits for a specific period of time.
These receipts are negotiable instrument that make them marketable securities. When
the certificates mature, the owner gets the full amount deposited plus interest. The
default risk is that of a bank failure which a remote possibility is.
5. Inter corporate deposit:
It means deposits made by one company with another company normally for a period
up to 6 months. Such deposits are usually of three types:
Call deposits:
It is a withdraw able by giving one day notice. Generally, the lender has to wait for
about 3 days or more.
Three month deposits:
This is a more popular form of inter-corporate deposit. It is accepted by borrowing
company to tide over a short term cash inadequacy.
Six-months deposits:
Such deposits are made by companies with first class borrowing company. The
borrowing company has to pay the rate of interest slightly higher than on 3 months
deposits.

SOURCES OF WORKING CAPITAL:

Sources of Working Capital

16

Long term

Short term

1. Equity & Preference

Shares
2. Retained Earnings
3. Term Loan
4. Loan from Financial
Institutions

Internal

1. Depreciation
2. Taxation Provision
3. Accrued Expenses

External

1.
2.
3.
4.
5.
6.
7.
8.
9.

Trade Credit
Bank Credit
Customer Credit
Govt. Assistance
Loans from
Directors
Security of
Employees
Commercial
Papers
Certificate of
Deposit
Inter-corporate
Deposit

INTRODUCTION OF WORKING CAPITAL MANAGEMENT:

INTRODUCTION:
Working capital is one of the most fundamental measures of companys financial
strength. If company possesses a significant value of liquid assets, it can easily fund its
day-to-day business obligation. Working capital also provides insight on how
efficiently a companys management able to oversee the company operation. The
speed at which the company is able to manage its short term assets and short term
liabilities is also crucial to its business success. Keeping working capital level to the
minimum required for efficient operation keeps cost down. This means controlling
buying, handling, storing, and managing stock property.

17

In simple terms, working capital refers to the cash a company requires in order to
finance its day-to-day business operation or in other words, working capital refers to
the amount of capital which is readily available to an organization. The term working
capital is more an accounting term a management concept. There are two concept of
working capital for the purpose of definition Gross Concept and Net Concept. Gross
Concept refers to firms current assets. The firms total current assets are termed as
gross working capital. Net Concept refers to current assets less current liabilities. That
means, working capital is difference between resources in cash or readily convertible
into cash (current assets) and organizational commitment for which cash will soon be
required (current liabilities).
Working Capital = Current Assets Current Liabilities
Generally the working capital management refers to that part or capital which is not
tied up in fixed assets but it is used to meet day to day requirement of business. This
type of capital is used to make payments for purchase of row material, wages, salary to
meet other expenses till good area sold in the market and money collected against that
sale, during this time money is to be required to perform various day to day
transactions and to do the payment or regular intervals.
TULSI SYNTEX manages its working capital mostly on its own that means its
manages the money on its own on most or events, but it may happen that if sufficient
cash is not available to the firm then money is to be managed from some other
outsides sources like:

Bank loan
Loan from outsiders
Collection of money from drafts and any other banking facilities etc.
Owners fund

NATURE OF WORKING CAPITAL:

The nature of working capital is described with the help of nature operation cycle of
the firm. The process of cash or operation cycle starts when a firm uses cash to
18

purchase raw material and pay for other manufacturing costs to produce goods. These
goods are carried as inventory for some time till they are sold. These processes are
described as circulating nature of current assets. The speed of circulation of working
capital of turnover of current assets is an indicator of the degree of efficiency of the
management.

FACTORS DETERMINING WORKING CAPITAL REQUIRMENTS:

Factor which determine the magnitude of working capital requirements are as follow:
1. Nature of business:
A TULSI SYNTEX is manufacturing enterprise so it require large amount of the
working capital for stockSales
of raw materials and finished products.
2. Volume of business:
The rate of turnover of TULSI SYNTEX is high, so the volume of business is great.
Because of this reason it requires more working capital.
Finishing
Products
3. Length of manufacturing cycle:
19

The manufacturing cycle refers to the time spend by a product right from the stage of
purchase its raw material to the stage of completion of finished goods. If
manufacturing period is long, then firm requires high amount of working capital. The
manufacturing process is not so long but the raw material is very costly so it requires
high working capital.
4. Business fluctuation:
In the textiles industries, we can see that in every year average 3 to 4 month will be
passed through high depression. Today in these industries, the depression is started
from about 6 month ago. So it requires higher fund for working capital.
5. Size of the firm:
A TULSI SYNTEX is a big company so naturally it requires high working capital.

CASH MANAGEMENT:
The term cash with reference to cash management is used in two senses. In a
narrower sense it includes coins, currency notes, cheques, bank drafts held by a firm
with it and the demand deposits held by it in banks.

In a broader sense it also includes near-cash assets such as, marketable securities and
time deposits with banks. Such securities or deposits can immediately be sold or
converted into cash if the circumstances require. The term cash management is
generally used for management of both cash and near-cash assets.

Objectives of Cash Management:

20

There are two basic objectives of cash management:

1. Meeting cash disbursements:
The first basic objective of cash management is to meet the payments Schedule. In
other words, the firm should have sufficient cash to meet the various requirements of
the firm at different periods of times. The business has to make payment for purchase
of raw materials, wages, taxes, purchases of plant, etc. The business activity may come
to a grinding halt if the payment schedule is not maintained. Cash has, therefore, been
aptly described as the oil to lubricate the ever-turning wheels of the business, without
it the process grinds to a stop.
2. Minimizing funds locked up as cash balances:
The second basic objective of cash management is to minimize the amount locked up
as cash balances. In the process of minimizing the cash balances, the finance manager
is confronted with two conflicting aspects. A higher cash balance ensures proper
payment with all its advantages. But this will result in a large balance of cash
remaining idle. Low level of cash balance may result in failure of the firm to meet the
payment schedule.

Motives for Holding Cash:

A distinguishing feature of cash as an asset, irrespective of the firm in which it is held,
is that it does not earn any substantial return for the business. In spite of this fact cash
is held by the firm with following motives.

A. Transaction Motive:

21

A firm enters into a variety of business transactions resulting in both inflows and
outflows. In order to meet the business obligation in such a situation, it is necessary to
maintain adequate cash balance. Thus, cash balance is kept by the firms with the
motive of meeting routine business payments.

B. Precautionary motive:
A firm keeps cash balance to meet unexpected cash needs arising out of unexpected
contingencies such as floods, strikes, presentment of bills for payment earlier than the
expected date, unexpected slowing down of collection of accounts receivable, sharp
increase in prices of raw materials, etc. The more is the possibility of such
contingencies more is the cash kept by the firm for meeting them.

C. Speculative motive:
A firm also keeps cash balance to take advantage of unexpected opportunities,
typically outside the normal course of the business. Such motive is, therefore, of
purely a speculative nature.
For example; a firm may like to take advantage of an opportunity of purchasing raw
materials at the reduced price on payment of immediate cash or delay purchase of raw
materials in anticipation of decline in prices.

D. Compensation motive:
Banks provide certain services to their clients free of charge. They, therefore, usually
require clients to keep minimum cash balance with them, which help them to earn
interest and thus compensate them for the free services so provided.
22

Business firms normally do not enter into speculative activities and, therefore, out of
the four motives of holding cash balances, the two most important motives are the
compensation motive.

CASH MANAGEMENT OF TULSI SYNTEX:

Usually TULSI SYNTEX done a cash business they collect their Sarees money from
retailer and other sellers in a day. And paid Sarees money to workers or others from
whom they produce the Sarees within days. TULSI puts very small amount of cash on
hand. The large amount of money they put in Banks (Co-operative Bank, Nationalized
Bank) they put their money as a Call Deposits so they can earn interest on it. TULSI
SYNTEX has done their major transaction (expenditure) by Bank Cheque.

A) Sources of Cash inflows of TULSI:

1.

Sarees Seals

B) Sources of Cash outflows of TULSI :

1. Cash purchases, Payments of payables, advances to suppliers, wages and salaries
and other operating expenses.
2. Repayment of loan and interest and tax payments
3. In case of credit purchases, a time lag will exist for cash payments. This will depend
on the credit terms offered by the suppliers.

23

 INVENTORY MANAGEMENT:

CLASSIFICATION OF INVENTORIES ACCORDING TO ABC ANALYSIS:

ABC ANALYSIS:
The ABC analysis is based on the proposition (1) managerial time and efforts are scare
and limited, and (2) some item of inventory are important than others. The ABC
analysis classified various inventory items in to three sets or groups of priority and
allocates managerial efforts in proportion of priority. The most important item are
classified as class A, those of intermediate importance are classified as class B and the
remaining item are classified as class C. the financial manager should monitor
different items belonging to different groups in that order of priority. Almost attention
is required for class A, followed by item in class B and then remaining item in class C.
Group A: It Includes those item which are very important and of high value but form
use a small proportion of total quantity of inventory.
Group B: It includes those items which are less important and low value but form use
large proportion of item then group A.
Group C: The remaining items must be placed in category C.

INVENTORY OF TULSI SYNTEX:

24

Yarn
Gray Fabric
Spin Fine Oil
Polyester Chips
Chemicals & Additives

IMPLEMENTATION OF SYSTEM:
Step: 1: A list of all items must be prepared in order to determine how many items is
there, what the consumption of each of them is and what is the price.
Step: 2: Calculate total cost by multiplying items price with number of units of
consumption.
Step: 3: Ranks must be given to each item on the basis of total value as calculated in
step 2. First rank must be allotted to the items having highest value and this way the
rank must be given in descending order.
Step: 4: Determine the % of each item. Firstly % of no. of each item with total number
and secondly % of total value of each items with total of all items.
Step: 5: All items must be grouped into A, B, C categories.
Grou
p
A
B
C

No. of item (In % of total no. of

Value of item (in % of total value of

items)

inventory)
25
35
40

77.49
19.51
3

25

ABC Analysis
100
90
80
70
60 No. of Items
% of Total
% of Total Value of Inventory

50
40
30
20
10
0
0

25

60

100

26

 RATIO ANALYSIS:
The financial statements are prepared and presented annually are of little use of
guidance of prospective investors, creditors and even management. If relationship
between various related items in these financial statements is established, they can
provide useful clues to gauge accurately the financial health and ability of business to
make profit.
This relation between two number expressed in terms of another e.g. in order to obtain
the rate of return on the paid up capital, the net profit of the business is divided by the
paid up share capital. The figure so obtained is the ratio. If the same is multiplied by
100, a percentage rate of return on paid up capital is obtained.
The use of ratios has become increasing popular during last few years only. Originally
the bankers used the current ratio to judge the capacity of the borrowing business
enterprises to repay the loan and make regular interest payments. Today, it has
assumed such an importance that anybody connected with the business turns to ratio
for measuring the financial strength and earning capacity of the business.
A supplier of funds in the form of share capital would like to analyze the accounts to
ascertain in earning capacity and future prospects.
A banker or other creditor will measure the repaying capacity and financial strength on
the basis of accounting ratios.

27

TYPES OF RATIOS:
Ratios are also grouped in accordance with certain tests. On this basis there are four
categories of ratios:
1. Liquidity Ratios: These ratios indicate the position of liquidity. They are
computed to ascertain whether the company is capable of meeting its short
term obligations from its short term resources.
For example, current ratio shows the capacity of the firm to meet its current
liabilities as and when they mature. E.g. (1) Current ratio, (2) Liquidity ratio,
(3) Acid test ratio.
2. Profitability Ratios: A number of ratios are designed to indicate the
profitability of the business and are grouped into the category of profitability
ratios.
For example, return on capital employed is an example `of profitability ratio.
E.g. (1) Gross profit ratio, (2) Net profit ratio, (3) Operating ratio, (4) Return
on capital employed ratio, (5) Return on shareholders fund.
3. Leverage Ratios: The composition of capital of business and the proposition
of owners capital and capital provided by outsiders are reflected by leverage
ratios.
For example, gearing ratio showing the relationship between the preference
capital and ordinary capital is a leverage ratio E.g. (1) Proprietary ratio, (2)
Debt equity ratio, (3) Long term fund to fixed asset ratio.
4. Activity or efficiency ratios: These are the ratios showing the effectiveness
with which the resources of the business are employed. It signifies the
efficiency of the management.
For example, Stock turnover is an Activity ratio, showing that number of times
the average stock is turned over during the year. E.g. (1) Debtors ratio, (2)

28

Debtors turnover ratio, (3) Creditors ratio, (4) Total assets turnover, (5) Fixed

assets turnover ratio, (6) Stock turnover ratio.

Liquidity Ratios:
1) Current Ratio = Current Assets
Current Liabilities
Where,
Current Asset = Cash & bank balance+ stock + debtors+ B/R+ Prepaid expenses+
Investment Readily Convertible into cash + loan & advance.
Current Liabilities = Creditors + B/P + Bank O/D + Unclaimed Dividend +
Provision for Taxation + Proposed Dividend.
Statement Showing Current Ratio
YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

CURRENT
ASSETS
2310499.92
2165493.51
2112089.74
2185632.27
2389906.59

CURRENT
LIABILITIES
776551.68
789847.5
689380.39
695721.84
722454.63

RATIO

% CHANGE

2.975:1
2.741:1
3.064:1
3.142:1
3.308:1

-7.866
11.78
2.55
5.28

CURRENT RATIO
15

11.78

10
Percentage

5.28

5
0
2008-09
-5
-7.87
-10

2009-10

2.55
2010-11

2011-12

Interpretation: As we can see, the current ratio of the company decreased in year
2008-09 compared to 2007-08. But it is increased in the year 2009-10. Then constantly
increases as we can see. Companys ratio is between 2.74:1 to 3.142:1 which shows
29

current assets are more than current liabilities which is good. But it is again decreases
in year 2011-12 compared to year 2010-11.

30

2) Liquid Ratio: Liquid Assets

Liquid Liabilities

Where,
Liquid Assets = Current Assets- Stock
Liquid Liabilities = Current Liabilities- Bank overdraft

Statement showing Liquid Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

LIQUID
ASSETS
1265849.27
1215042.96
1209939.41
1265975.02
1389630.95

LIQUID
LIABILITIES
776551.68
789847.5
689380.39
695721.84
722454.63

RATIO

% CHANGE

1.630:1
1.538:1
1.755:1
1.820:1
1.923:1

-5.64
14.11
3.70
5.66

LIQUIDITY RATIO
20
15

14.11

10
Percentage

5.66

0
2008-09
-5
-5.64

2009-10

3.7
2010-11

2011-12

-10

Interpretation: It shows the amount of cash available to meet immediate payments.

The liquid assets should be more than the liquid liabilities which indicates that the
situation is satisfactory. If the liquid assets are equal to or more than liquid liabilities,
the condition may be considered as more then liquid liabilities. The liquid ratio in
2008-09 was 1.538:1 and in 2009-10 was 1.755:1; in 2010-11 it is 1.82:1 and in 201112 was 1.923:1. The company cash increases continuously from the year 2008-09.
31

3) Acid test ratio =

Quick Assets
Liquid Liability

Where,
Quick Assets = Liquid Assets Debtors
Statement Showing Quick Ratio
YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

QUICK
ASSETS
810308.61
803792.65
830688.05
846724.66
899104.59

LIQUID
LIABILITIES
776551.68
789847.5
689380.39
695721.84
722454.63

RATIO

% CHANGE

1.043:1
1.012:1
1.205:1
1.217:1
1.245:1

-2.97
19.07
1.00
2.3

ACID TEST RATIO

25
20

19.07

15
Percentage

10
5

0
2008-09
-2.97
-5

2.3
2009-10

1
2010-11

2011-12

Interpretation: This is more exacting standard of liquidity and it is satisfactory if the

ratio is 0.5:1. Here in the current years ratio is more than 0.5 which is satisfactory.
Here in this ratio is more than 1.0 from last 5 years; this shows that companys ability
to meet its current obligation. This is because the company has spent money on
promotion. Companys acid test ratio is increasing from last 4 years, which shows the
good quick assets than liquid liabilities.

32

Profitability Ratios (On The Basis Of Sales):

1)

Gross Profit = Gross Profit *100

Sales
Statement Showing Gross Profit Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

GROSS
PROFIT
18033956.16
16082663.01
13209521.81
14738165.09
15813459.91

SALES

RATIO

% CHANGE

18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

97.30%
91.85%
92.79%
94.75%
95.26%

-5.60
1.02
2.11
3.70

GROSS PROFIT RATIO

6
3.7
4
1.02
2
2.11
0
Percentage 2008-09 2009-10 2010-11 2011-12
-2
-4
-5.6
-6
-8

Interpretation: It is the ratio indicating the relationship between gross profits earned
to net sales. If this ratio is low, it indicates that the cost of sales is high or that the
purchasing is inefficient. Here in this case the ratio has reduced in the year 2008-09 by
5.6%, so company tried to increase the ratio and they did it. The gross profit ratio is
increasing slowly then after the year 2008-09.

33

2)

Operating Ratio = Cost of Goods Sold +Operating Expenses *100

Net Sales

Where,
COGS = Opening stock +Net purchase +Purchase exp Closing stock
OPERATING PROFIT = COGS + Operating Expenses

Statement Showing Operating Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

OPERATING
PROFIT
4262910.94
3808204.33
3554546.15
2850936.54
2893177.58

SALES

RATIO

% CHANGE

18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

23.00%
21.75%
24.97%
18.33%
17.43%

-5.44
14.81
-26.59
-4.91

OPERATING RATIO
20

14.81

10
0
-4.91
2008-09 2009-10 2010-11 2011-12
Percentage-5.44
-10
-20
-30

-26.59

Interpretation: Higher the ratio, the less profitable it is for the company, because it
would prove insufficient to pay dividend and create necessary reserves. So we can say
that out of the sales of Rs 100, Rs 85 is taken away by cost of goods and other 15 is
kept with the proprietor. As you can see the operating profit in 2011-12 is 2893177.58
and the sell against it are 16598838.67 this shows that company expenses less than it
sell. The company is able to sell the products according to its expenses.
34

35

3)

Net Profit Ratio =Net Profit *100

Net Sales
Statement Showing Net Profit Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

NET PROFIT
7709135.81
11072863.45
9076206.83
7364932.36
8260447.32

SALES
18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

RATIO
41.59%
63.24%
63.76%
47.55%
49.77%

% CHANGE
52.06
0.82
-25.74
5.11

NET PROFIT RATIO

60
52.06
40
Percentage

20

5.11
0.82
0
2008-09 2009-10 2010-11 2011-12
-20
-25.74
-40

Interpretation: This ratio indicates what portion of sales revenue is left to the
proprietors after all operating expenses are met. The higher this ratio, the better will be
the profitability. The ratio has decreased as compared to the previous year i.e. the
profitability of the company has fallen from the sales point of view. A high net profit
margin would ensure adequate return to the owners as well as enable a firm to with
stand adverse economic condition when selling pricing is declining, cost of production
is failing. In 2008-09 profit is very high because the sale is declining. But in the year
2010-11 net profit ratio fallen by 25.74% compared to its previous year 2009-2010.

36

Profitability Ratio (On The Basis Of Investment):

1) Return on capital employed = Net Profit after Tax *100
Capital employed
Where,
Capital employed = Share Capital + Reserves+ Long Term Funds

Statement Showing Return on Capital Employed Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

NET PROFIT
AFTER TAX
6351635.45
9452824.67
7775631.58
7223719.11
6495193.20

CAPITAL
EMPLOYED
7650326.99
7559099.20
7483923.66
7623874.96
7637489.62

RATIO

% CHANGE

83.020%
125.05%
103.90%
94.750%
85.040%

50.63
-16.91
-8.81
-10.25

RETURN ON CAPITAL EMPLOYED RATIO

60
50.63
50
40
30
Percentage

20
10
0
2008-09
-10

2009-10
-16.91

-8.81
2010-11

-10.25
2011-12

-20
-30

Interpretation: This ratio indicates the profitability of the company and is obtained
by comparing net profit with capital employed. In year 2008-09 company earned
Rs.9452824.67 and its ratio is 125.05% which is the highest compared to other years.
Companys ratio is 103.9% in the year 2009-10, which is also good compared to other
years. Company has lowest ratio in the year 2007-08 that is 83.02%.

37

2) Return on shareholders fund = Net Profit (after tax) *100

Shareholders fund
Where,
Shareholders fund = Share capital + Reserve & Surplus Fictitious Assets

Statement Showing Return on Shareholders fund

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

NETPROFIT
(AFTER
TAX)
6351635.45
9452824.67
7775631.58
7223719.11
6495193.20

SHAREHOLDER
S FUND

RATIO

% CHANGE

3345544.31
3363510.32
3254412.32
3282622.32
3345987.12

189.85%
281.04%
238.93%
220.06%
194.11%

48.03
-14.98
-7.90
-11.79

RETURN ON SHAREHOLDER'S FUND RATIO

60
48.03
50
40
30
Percentage

20
10
0
2008-09 2009-10
-10
-14.98
-20

-7.9
2010-11

2011-12
-11.79

Interpretation: This ratio shows the amount of dividend to be received on each share.
It also indicates whether the return on proprietors fund is enough in relation to the
risks that they undertake. The investors can know the profitability of the company.
Company has the highest ratio in the year 2008-09 that is 281.04%. But then it is
declined in the year 2009-10 by 14.98%. But then it is increased in 2010-11.

38

Leverage Ratios:
1)

Proprietary ratio = Share holders fund * 100

Total Asset

Where,
Share Holders Fund = Share capital + Reserve & Surplus
Total Asset =Fixed Assets + Investment + Current Assets

Statement Showing Proprietary Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

SHAREHOLDER
S FUND
3345544.31
3363510.32
3254412.32
3282622.32
3345987.12

TOTAL
ASSETS
7322903.34
6739025.40
6480125.08
6730190.34
7159756.39

RATIO

% CHANGE

45.69%
49.91%
50.22%
48.77%
46.73%

9.24
0.62
-2.89
-4.18

PROPRIETARY RATIO
12
9.24
10
8
6
4
Percentage
2
0
2008-09
-2
-4
-6

0.62
2009-10

2010-11
-2.89

2011-12
-4.18

Interpretation: This ratio shows the proportion of proprietors funds to the total assets
employed in the business. Higher the ratio, the stronger the financial position of the
company, as it signifies that the proprietors have provided larger funds to purchase the
assets.
39

40

2)

Debt Equity Ratio = Long term liabilities * 100

Shareholder funds

Where,
Shareholders Fund = Pref. share + Equity Share + Reserves

Statement Showing Debt Equity Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

LONG TERM
LIABILITIES
560258.25
590142.52
650147.92
622154.69
589447.36

SHAREHOLDER
S FUNDS
3345544.31
3363510.32
3254412.32
3282622.32
3345987.12

RATIO

% CHANGE

16.75%
17.55%
19.98%
18.95%
17.62%

4.78
13.85
-5.15
-7.02

DEBT EQUITY RATIO

20
15

Percentage

13.84

10
4.78
5
0
2008-09
-5

2009-10

2010-11
-5.15

2011-12
-7.02

-10

Interpretation: It shows the proportion of long term external equities and internal
equities. i.e. proportion of funds provided by long term creditors, that provided by
share long term creditors, and that provided by shareholders or proprietors. In the year
2009-10, the ratio is higher that is 19.98% compared to other years. But after year
2009-10, it is declining which is good for the company.

41

3)

Long Term Funds To Fixed Asset Ratio = Long Term Fund

Fixed Assets

Where,
Long Term Fund= Share Capital + Reserves +Long Term Liability

Statement Showing Long Term to Fixed Asset Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

LONG TERM
FUNDS
4304782.68
4195588.88
4229511.34
4341252.64
4291502.50

FIXED
ASSETS
3959873.42
3628031.89
3472535.34
3567358.07
3708599.80

RATIO

% CHANGE

1.09:1
1.16:1
1.28:1
1.27:1
1.16:1

6.42
10.34
-0.78
-8.66

LONG TERM FUND TO FIXED ASSET RATIO

15
10
6.42

10.34

5
Percentage
0
2008-09

2009-10

-0.78
2010-11

2011-12

-5
-10

-8.66

Interpretation: This ratio shows the relationship between fixed capital and fixed
assets. Lower the ratio means the firm uses the short term funds for the purchase of
fixed assets which should not be so. The ratio should always be 1:1 which is good for
the firm. As we can see the ratio has decreased in the current year by 8.66% compared
to previous year, so its not a positive sign for the company. Company has the highest
ratio in the year 2009-10 that is 1.28:1.

42

Activity Ratio:
1)

Stock Turnover Ratio = Cost of Goods Sold

Average stock
Statement Showing Stock Turnover Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

COST
OF
GOODS
SOLD
4557587.02
4951253.60
5125659.02
5356587.45
5699598.12

AVERAGE
STOCK

RATIO

% CHANGE

3560614.86
4160717.31
3584376.94
2705347.20
2345513.63

1.28 times
1.19 times
1.43 times
1.98 times
2.43 times

-7.03
20.17
38.46
22.73

STOCK TURNOVER RATIO

40
35
30
25
20
Percentage 15
10
5
0
2008-09
-7.03
-5

33.46
22.73

20.17

2009-10

2010-11

2011-12

-10

Interpretation: This ratio signifies the number times stock is turned over during the
year. Higher the ratio, the situation is profitable to the company. Here in we can see
that the ratio has increased from the previous year which shows that the company is in
profitable position.

43

2)

Debtors Turnover Ratio = Credit Sales

Average Debtors
Statement Showing Debtors Turnover Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

CREDIT
SALES
18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

AVERAGE
DEBTORS
455540.66
433395.49
395250.84
399250.86
454888.36

RATIO

% CHANGE

40.69 times
40.40 times
36.02 times
38.96 times
36.49 times

-0.71
-10.84
8.16
-6.34

DEBTORS TURNOVER RATIO

10

8.16

5
-0.71
0
Percentage 2008-09
-5
-10

2009-10

2010-11

2011-12
-6.34

-10.84

-15

Interpretation: This ratio suggests the number of times the amount of credit sale is
collected during the year. In the year 2007-08, ratio is 40.69 times, that is highest
compare to other years. But in year 2009-10, it has the lowest ratio that is 36.02 times,
compare to other years.

44

3)

Debtors ratio = Debtors + Bills receivable * 365

Credit sales

Statement Showing Debtor Ratio

YEAR
2007-08
2008-09
2009-10
2010-11
2011-12

DEBTORS +
BILLS
RECEIVABLE
455540.66
411250.31
379251.36
419250.36
490526.36

CREDIT
SALES

RATIO

% CHANGE

18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

9 days
9 days
10 days
10 days
11 days

0
11.11
0
10

DEBTORS RATIO
12

11.11

10

10

8
Percentage

6
4
2
0
0
2008-09

0
2009-10

2010-11

2011-12

Interpretation: This ratio shows the number of days taken to collect the dues of credit
sales. It shows the efficiency or the collection policy of the company. Higher the ratio
its unsatisfactory for the company i.e. the collection is weak. As we can see the days
have increased from 9 to 11 days which indicates that companys working capital is
decreasing slowly from its satisfactory position.

45

4)

Creditors ratio = Creditors + Bills Payable * 365

Credit Purchase
Statement Showing Creditor Ratio

YEAR

CREDITORS
+
BILLS
PAYABLE
26780.10
23101.24
28923.95
57233.93
94455.57

2007-08
2008-09
2009-10
2010-11
2011-12

CREDIT
PURCHASE

RATIO

% CHANGE

3257758.25
2105250.56
1507809.15
1899059.55
2154251.23

3 days
4 days
7 days
11 days
16 days

33.33
75
57.14
45.46

CREDITORS RATIO
80
70

75
57.14

60
50
Percentage

45.46

40
30
33.33
20
10
0
2008-09

2009-10

2010-11

2011-12

Interpretation: This ratio shows that in how many days the company can make the
payment to its creditors for credit purchase. As we can see that the days have increased
from 3 to 16 which mean the credit reputation of the company is good. And it is
increasing from the last five years. Company can utilize the money for some days in
other activities.

46

5)

Fixed assets turnover =

Sales

Fixed Assets
Statement Showing Fixed Asset Turnover Ratio
YEAR

SALES

2007-08
2008-09
2009-10
2010-11
2011-12

18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

FIXED
ASSETS
3959873.42
3628031.89
3472535.34
3567358.07
3708599.80

RATIO

% CHANGE

4.68 times
4.83 times
4.10 times
4.40 times
4.48 times

3.21
-15.11
7.32
1.82

FIXED ASSETS TURNOVER RATIO

10
5
3.21
0
2008-09
Percentage -5

7.32
1.82
2009-10

2010-11

2011-12

-10
-15

-15.11

-20

Interpretation: This ratio indicates that how effectively the fixed assets are used. Here in
year 2009-10 the ratio has decreased compared to the previous year which means the
companys investment in fixed assets is more and has to be reduced. The Fixed assets ratio
are more in the year 2011-12 but the company does not have enough sales as compare to
last 2 year and therefore the fixed assets ratio has declined.

47

6)

Total Assets Turnover =

Sales

Total Assets
Where,
Total Asset = Fixed Assets + Current Assets

Statement Showing Total Asset turnover Ratio

YEAR

SALES

2007-08
2008-09
2009-10
2010-11
2011-12

18534395.39
17508985.43
14235266.90
15553390.83
16598838.67

TOTAL
ASSETS
5493821.66
5003677.90
4895244.69
5057268.50
5376051.76

RATIO

% CHANGE

3.37 times
3.50 times
2.91 times
3.08 times
3.09 times

3.86
-16.85
5.84
0.32

48

TOTAL ASSETS TURNOVER RATIO

10

5.84
5
3.86

0
2008-09

Percentage

2009-10

2010-11

0.32
2011-12

-5

-10

-15
-16.85

-20

49

Interpretation: This ratio shows the efficiency of the business i.e. higher the ratio the
company is investing less in total assets and still has the capacity to sell more. But the
ratio has decreased in the current year compared to the previous years. The higher this
ratio, it shows that with less amount of investment in total assets. As the liabilities are
more than assets the sales in the year 2011-12 is 16598838.67 and total assets are

Human Resource
Department
5376051.76 which show the fewer amounts are invested in total assets.

INTRODUCTION:
Human Resource Management is the function within an organization that focuses
on recruitment of, management of, and providing direction for the people who
work in the organization. Human Resource Management can also be performed
by line managers.

Human Resource Management is the organizational function that deals with

issues related to people such as compensation, hiring, performance appraisal,
benefits, employee motivation, organizational development, safety, wellness,
training, communication and administration.

Human Resource Management is also a strategic and comprehensive approach to

managing people and the workplace culture and environment. Effective Human
50

Resource Management enables employees to contribute effectively and

productively to the overall company direction and the accomplishment of the
organizations goals and objectives.

Human Resource Management is now expected to add value to the strategic

utilization of employees and that employee programs impact the business in
measurable ways. The new role of Human Resource Management involves
strategic direction and Human Resource Management measurements to
demonstrate value.

ORGANIZATIONAL

STRUCTURE

OF

HUMAN

RESOURCE

DEPARTMENT:

WH
ee
R

M
aa
nr
ea
Og
e
r

c
e
r

A
. s
n.

s
t

a
t

R
M

f
ff

.
n

a
e

g
r

Human Resource Management is that part of management which is concerned with

people at work & their relationship within the organization. The term Human
Resource Management refers to the management of personnel in the organization
of any company to achieve the predetermined goals. The duty of the personnel
manager is to look after the personnel department and various functions of the
personnel like recruitment, selection, promotion, transfer, etc.
A formal definition of HRM is as follows:

51

HRM is the planning, organizing, directing and controlling of the

procurement, development, compensation, integration, maintenance and
separation of human resources to the end that individual, organizational and
social objectives are accomplished.
In Tulsi Prints, there is Personnel & Administration Department to carry out the
functions of Human Resource Management. Here, the term Personnel &
Administrations refers to the administration of personnel.
Realizing that employees are its greatest assets, Tulsi Prints from its very inception
has been striving to build up a sound & transparent organizational culture to
inclusive to sense of belonging among its employees.
HR VISION OF THE COMPANY:

The vision of TULSI SYNTEX PVT. LTD. is to be the number one in the textile
market in Surat city and become a globally recognized company through
innovation, passion through quality, freedom through empowerment and cost
through volumes.

HR MISSION OF THE COMPANY:

52

The mission of TULSI SYNTEX PVT. LTD. is to create a good consumer

satisfaction through good quality, after sales service, innovations, human resource
development, continuously striving for excellence with pride in our values and
confidence in our approach.

53

HR Management Activities

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D E C. . P. P R T E RO R A M F I O NO R IT N M I O G A N N& &C D E T E AR V PA E P N L R O S A FP I EM S R AE LN T
G . I N FH . C . W E I N NA D GT U I E V S S E T & RS YI SA S AL T L ER A M E R L Y A TS I Y O S N T S E M

54

A. HUMAN RESOURCE PLANNING AND ITS PROCESS:

Human Resource Planning is the process by which an organization ensures that it
has the right number and kind of people, at the right places, at the right time,
capable of effectively and efficiently completing those tasks that will help the
organization achieve its overall objectives.
According to Company,
The development of strategies for matching the size and skills of the workforce
to organizational needs. Human resource planning assists organizations to
recruit, retain and optimize deployment of the personnel needed to meet
business objectives. This process helps for manpower forecasting and taking
action to ensure that supply meets demand. This may include the development
of training and retraining strategies.
It focuses to ensure that the organization obtain and retain the quantity and quality
of people it needs.
Now lets see the process of Human Resource Planning of the Tulsi Syntex Pvt.
Ltd.:

55

1) GOAL:
The company believes if the main objective of the HR Department is decided, then
it is very easy to follow the future steps because it gives clear vision for the future
conditions and work patent. Company decides its personnel HR objective every
year and based on that the company follows the steps easily.
For Example: In the year 2012, company decided the sales target of 50 lakhs
through in India.
2) ESTIMATE FUTURE REQUIREMENT:
The second step in the process is Human Resource Requirement. In this step, the
company identifies the number of employees that are required for the current year.
The company estimates the overall requirement and budget for the whole year at
one time at the time of starting of financial year of the company.
3) SUPPLY FORECASTING:

56

The company gets the total number of employee required in the organization
throughout the year and for that, the company starts the search for the sources.
Company depends on Data Banks which is really helpful resource.
4) ORGANISATION OF OTHER ACTIVITIES:
The fourth step in the process includes the companys planning for TRAINING,
DEVELOPMENT,

PROMOTION

&

TRANSFER

POLICY, CONTROL,

STAFFING, RECRUITMENT & SELECTION, etc. The budget is prepared for all
these activities according to the finance available to the company.
5) EVALUATION OF THE SYSTEM:
Finally, the last step is evaluation of the entire programme with the help of
controlling system. The company verifies whether our objectives are achieved or
not. If it is going as decided, then the company believes that the planning is
appropriate and the company will put the goal higher for the manager and Human
Resource Department.
If the goal is not being achieved or the management is not satisfied with the result,
then company finds out the mistakes committed in the planning and solves it. For
solving it, the company takes remedial actions and re-plans for that particular year
for the achievement of organizations goal.

57

B.

RECRUITMENT AND SELECTION:

Definition of Recruitment:
Recruitment is the process of acquiring right candidates, at right place and right
time.

Sources of Recruitment:
The Tulsi Syntex Pvt. Ltd. undertakes the following sources for recruiting any
candidate:

DA
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SOURC
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CAM PU
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R E C A L L IN G
R E TR E N C H E
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F R IE N
DS &
R E LAT I
VES

58

The following are the sources of Tulsi Syntex Pvt. Ltd.:

1.

Transfer:
By transferring an employee of one division to other division where he is
required, needs of the recruitment can be satisfied for a short period. Transfer
may be for shorter or longer period.

2.

Promotion:
Any employee having same qualifications and skills required at higher position
can be promoted to the post. Such promotion of employee will boost their morale
and loyalty.

3.

Friends & Relatives of Employees:

Recruitment can be made by getting application from relatives and friends of
employees. This opportunity of participating in the recruitment of co-worker will
help to boost their morale.

4.

Recalling Retrenched Employees:

Former employees, retrenched for want of work can also be re-called as and
when necessary.
The above described four sources make it possible to recruit hard working and
trust worthy employees as less expense and less time is wasted. These sources
are useful for the recruitment of non-managerial staff such as workers and clerks.

5.

Online Recruitment:
This is the latest source of recruiting the employees. Tulsi Syntex Pvt. Ltd. uses
this source as well. The companys managers recruit many eligible candidates
from job sites.

6.

Head Hunting:
59

The Tulsi Syntex Pvt. Ltd. keeps an eye on the employees of the competiting
companies for observing employees performance. If any employee of the other
company performs well, then this company tries to recruit that employee by
offering him a better pay package than of competitors.

7.

Campus Recruitment:
Campus recruitment of graduates from technical institutes, colleges and
universities provide specialized knowledge personnel to business management.
Recruitment can be made for required personnel by getting names from the
concern heads of institutions or by personnel interviews at the campus itself. The
companys HR Executives visited Ahmadabad University in 2008-09 for
recruiting knowledgeable personnel.

8.

Data Banks:
The management can collect the bio-data of candidates from different sources
like Employment Exchange, Educational Training Institutes, candidates etc. and
feed them in computer.

It will become another important source and the

company can get the particulars as and when it needs to recruit.

60

 SELECTION:

Definition of Selection:
The selection means the process of selecting right candidate by verifying the
application received from the candidates. It consists of the verification of the
knowledge of relevant jobs, skills and various qualifications of the candidates.

Process of Selection:
The Tulsi Syntex Pvt. Ltd. performs the following procedure to select the
employees:

61

1) ONLINE SEARCHING:
The selection process starts with online searching. The company searches the
employees with required qualifications on various job sites. The company gets
details from sites and calls the eligible candidates to the head office for the
further process.

2) SCREENING OF APPLICATION:
After online searching, the application forms are screened in terms of whether
they are duly filled or not. The invalid forms are cancelled or rejected. After
62

screening is done, the candidates are called for employment test. As far as
possible, the application form should be short and simple.

3) EMPLOYMENT TEST:
Job seekers who pass the screening procedure are called for employment test.
Different types of tests may be administered depending on the job and the
company. Generally, the tests are conducted to determine the applicants Ability,
Aptitude and Personality. Employment Test includes Ability Test, Aptitude Test,
Personality Test, Interest Test and Medical Test. These tests show a various
internal abilities of a candidate.

4) PERSONAL INTERVIEW:
Candidates who are successful in these tests are called for personal interview.
Further information regarding details given in the application form is asked at
the personal interview. Question related to work are asked in the personal
interview.

The

interview

committee

includes

representatives

of

the

management, departmental heads, personnel manager and other concerned

members. Conditions of services and remuneration are made clear during the
interview.
5) REFERENCE CHECKING:
The information given by the candidate in the application form is checked by
referring to his present and past employees to get an idea of the correct
situation.

6) PRELIMINARY SELECTION:
If the above processes, the candidate is found suitable, a preliminary selection is
made and he may be appointed on probation or trainee. During this period, he is
constantly observed and assessed.
63

7) FINAL SELECTION:
After passing all the required tests, the candidate is finally selected on the
recommendation of the departmental head. The personnel manager act as an
expert in this final selection and placement.

64

C.

TRAINING & DEVELOPMENT:

Introduction of Training:
Every individual needs to learn about the work that he is about to perform. The
company has hardworking and competent employees but if the candidate doesnt
know what to do, then e will get confused and wont be able to show his
performance. For this reason, the companies conduct TRAINING programme to
make a candidate more skilled and efficient.
Definition of Training:

Training means giving up to date information and knowledge for gaining

efficiency in business and developing taste and aptitude of the employees. It is a
process of developing necessary knowledge and understanding in works about
the specific functions of the company.
According to the company,
The training is one kind of investment of the company in which the employee
learns the technical knowledge to solve their work related problems and also
enhance their knowledge.
Generally, the Tulsi Syntex Pvt. Ltd. gives three types of training:

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1) INDUCTION TRAINING:
Basically this is one kind of well coming process of training to the employee. We
all know that when the employee is newly appointed, he is not familiar with the
employees staff and other places of the store. So it is very important to introduce
him with all and all the necessary information is to be given. It is necessary
because if the employee directly starts working, on first day, then he will get
confused and feels discontentment. To solve this, companies conduct induction
training.
Now lets see how Tulsi Syntex Pvt. Ltd. gives induction training to employees:
When a new employee comes in the company, the company manager will
welcome him with the staff.

After that, the manager will introduce himself as well as the entire staff
who will work with the new employee and also introduce him to the
designation of other employee.

The next step is to give clear information about his work, designation and
authorities and responsibilities and his colleagues.
2) EMPLOYEE TRAINING:
The company provides two types of employee training:

66

OE
NM
P
TL
HO
EY
E
JE
OO
BT
R
TA
RI
AN
I
N
IG
N
G

i.

ON THE JOB TRAINING:

When the employee joins the company, the company gives induction training but
after that company gives on the job training. The company gives training to the
employee when he is on the job; means the company teaches how to handle
machines well to make production in good way. This is less expensive and simple
method suitable to small units.

ii.

SEASONAL TRAINING:
This is also one kind of on the job training, but the difference is that this training
is done for special seasonal offers and it is short term process. In this, the
company gives training for the product for increasing the sales.
The Tulsi Syntex Pvt. Ltd. organizes training programme for its employees
once in every year.

67

3) TRAINING GIVEN TO SENIOR MANAGERS:

The Tulsi Syntex Pvt. Ltd. also conducts training programmes for the senior
managers to make them efficient as well as to improve their skills. The managers
have authorities and have to take the responsibilities for the entire company. So
therefore, they need some special training to face the different situations arising in
the company. For this, the manages have to go to Mumbai for 15 to 30 days where
training programs are being conducted for them so that they can acquire the
knowledge about the company as well as other important information necessary
for making the company more successful.

68

 DEVELOPMENT:
The Tulsi Syntex Pvt. Ltd. does not have any development programmes as the
training programmes include the development related activities in it. But company
has given some points to describe the importance of development as under:

It refers to an overall growth of the employee by enhancing his talent

capacities and changing his personality.

The role of development is wide and covers various activities.

It is mainly for the superior officers as to increase their efficiency.

It is a long process as it requires more time and money to get the best
results.

Employees get self-motivated and accept the new changes seriously as well
as their decision making ability becomes fast and quick.

69

D.

PROMOTION & TRANSFER:

Introduction of Promotion:
It is very important to keep the employee motivated to get his best performance
and results. Every company has its own promotion policy with some terms and
conditions. Many companies give promotion on the basis of sales done. The
sales are not only the bases for giving promotion. There are other factors which
affect the promotion policy.

Definition of Promotion according to Tulsi Syntex Pvt. Ltd.:

A promotion may be defined as an upward reassignment of the job position of
an employee with increased pay package, authorities, responsibilities and
workload.
The company has two types of promotion policies. The company believes that
both are suitable as per the present situation.
P
S
R
T
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M
F
O
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L
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E
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L

As discussed earlier, the company not only believes in sales but also other
points which are covered by the company in the policy of promotion. The
managerial level policy includes different points and the staff level promotion
includes different points but the similarity in both is that they have same points
i.e. Sales and the Attitude of the employees.
IMPORTANCE OF THE PROMOTION IN COMAPANY:

70

It is true that when the employee gets the promotion, his salary increases. The
company needs to give more salary and ultimately the expenses will also
increase, but the company says that PROMOTION IS IMPORTANT FOR ANY
COMPANY. Lets see the reason for this believe:
The company strongly believes that if we give promotion to the employee,
employee will highly motivated and will work harder. At the end, the sales and
profit of the company increases and profit of worker also increases.

The company also says that the promotion also increases the employees
satisfaction. So if the employee comes to know any confidential matter of the
company, he will not share this with any other employee and with the
competitors.

Also, the promotion reduces the employee turnover ratio. If fewer employees
will leave the job, the company will have lower expenses after recruitment and
selection.

The other benefit is that the good relation will continue between the company
and employees. So that the clashes reduce and time can be save.

So, the company believes that the promotion is the most important tool for the
company to maintain the employees in the organization and motivate them to
work more. If the company needs to do more expenses on promotion, then the
company will get more rewards compared to those expenses.

71

 TRANSFER:

Introduction of Transfer:
An employee needs some change and some new place as to need change in work
to work with that efficiency and energy. For that, company has a policy of
transfer. Not only one or two but all big or small units use this policy of transfer.

Definition of Transfer according to Tulsi Syntex Pvt. Ltd.:

The process of placing an employee from one place to another without any
change in responsibility or salary is called Transfer. The transfer policy of the
company is transparent in order to avoid discontent amongst the staff
members.

Reasons for Transfer:

Shortage of staff in a department.

To remove boredom from same work and place.
To take advantage of special skill of the transferred staff members.
To correct an improper placement.
To penalize an employee due to his misbehavior.
On request of an employee.

The above mentioned reasons are the points included into the Transfer Policy of
the company.

72

E. PERFORMANCE APPRAISAL:

Introduction of Performance Appraisal:

Once the employee has been selected, trained and motivated, he is then appraised
for his performance. Performance Appraisal is a step where the management finds
out how effective it has been at hiring and placing employees.

Definition of Performance Appraisal according to the Company:

Performance Appraisal means the process of evaluating an employees
performance and giving him the rank and also to advice to perform more
effectively in future.

An employee gets appraisal after every year. During the time period of a year, the
employees work on temporary basis when they join the company. The employee
is observed very carefully. If the employees achieve their goals and matches the
standards, he is hired on permanent basis.

When any employee enters the Tulsi Syntex Pvt. Ltd. then the manage gives him
all the information about related to the company as well as standards and goals
which are to be achieved by the employee. Moreover, the basic idea referred to
working process is also given.

The Tulsi Syntex Pvt. Ltd. has divided Performance Appraisal in four categories:

73

1. STAR PERFORMANCE:
Under this category, those employees are included who are very efficient and
their performance is very good and matching the companys standards. These
employees know how to work and to achieve the given targets.

2. AVERAGE PERFORMANCE:
In this, those employees are included who are good at their work but their
performance is not 100%. They are 75%-80% good in their performance.
They are given some advice for their better performance.

3. POOR PERFORMANCE:
In this category, those employees are included who are not doing their work as
expected. They need some motivation for their better performance. So
manager has to give some kind of training and motivation to those employees
so that they can also do their work in a proper manner. Without motivation
and proper guidance, they will not be able to achieve even low standards.

4. LAGGURD:
It includes those employees who always need guidelines. Without proper
guidelines, they are not able to work well. If the manager does not concentrate
on those employees, they will not do their work properly and regularly.

74

 PERFORMANCE APPRAISAL SHEET OF TULSI SYNTEX PVT. LTD.:

GRADE

CADRE

WEIGHTAGE OF EMPLOYEES
KPA

TRAININ

MANAGERIAL

60%

30%

10%

100%

MANAGERIAL

50%

40%

10%

100%

40%

50%

10%

100%

10%

60%

10%

100%

C
D

COMPETENC

TOTAL

NON
MANAGERIAL
NON
MANAGERIAL

GRADE A:
In Grade A, the managerial personnel are included. In this, C.E.O., Head
Operations Managers, Marketing, Production, Finance Manager, Company
Secretary and General Manager are included. They are paid higher salaries but
they also have higher responsibilities.
GRADE B:
In Grade B, Project Manager, Logistic, System Analyst, Ware House Manager etc.
are included. All these are paid low compared to Grade A employees but also
have lower responsibilities as well.

GRADE C:
In Grade C, the non managerial employees are included like Supervisors, Shift InCharge and Register Manager, etc.

GRADE D:

75

In Grade D, the non managerial workers like Store Workers and Watchmen etc.
are included.

76

 PERFORMANCE RATING SYSTEM OF TULSI SYNTEX PVT. LTD.:

PERFORMANCE
RATING
BASES
FOR
PERFORMANCE

81~100
VERY
GOOD

61~80

41~60

0~40

GOOD

SATISFY

UNSATISFY

VERY GOOD:
This is the level where the employees achieve almost full targets of the
organization. The goal achieving level may be around 81% to 100%. If the
employees achieve this level, the bonus salary increment and other money base
rewards and motivation will be given by the company to those employees.

GOOD:
In second category, the employees who perform their work in a good manner are
included. The margin is around 61% to 80%. If any employee achieves this result,
the company will provide non monetary rewards like Conference motivation, Job
Security, gifts, etc.

SATISFIED:
In this, the ratio of work is 41% to 60%. The result is satisfactory and motivates
the employee to perform more and more and is asked if any training is needed.

NON-SATISFIED:
This is the category which is the lowest of the table and the company as well as the
manager is not satisfied with the performance of the employee. The ratio is around
0% to 40%. The employee is personally called by the manager and asked if there is
any problem as well as warning is given to the employees and is also show the
ways to increase the performance.
77

 PROCESS OF PERFORMANCE APPRAISAL:

Performance appraisal is a very important task for any company. Without

performance appraisal, it is impossible to evaluate the employees. But how and in
what manner the employees should be motivated? The process is shown below:

1. ESTABLISHING STANDARDS:
The first step in the process of performance appraisal is the setting up of which
will be used as the base to compare the actual performance of the employees. This
step requires setting the criteria to judge the performance of the employees as
successful or unsuccessful and the degrees if their contribution to the
organizational goals and objectives. The standards set should be clear, easily
understandable and in measurable terms. In case the performance of the employee
cannot be measured, proper care should be taken to describe the standards.
2. COMMUNICATING WORKERS:
78

Once set, it is responsibility of the management to communicate the standards to

all the employees of the organization. The employees should be informed and the
standards should be clearly explained to them. This will help them to understand
their roles and to know what exactly is expected from them. The standards should
also be communicated to the appraisers or the evaluators and if required, the
standards can also be modified at this stage itself according to the relevant
feedback from the employees or the evaluators.

3. MEASURING THE ACTUAL PERFORMANCE:

The most difficult part of the performance appraisal process is measuring the
actual performance of the employees i.e. the work done by the employees during
the specified period of time. It is a continuous process which involves monitoring
the performance throughout the year. This stage requires the careful selection of
the appropriate techniques of measurement, taking care that personal bias does
not affect the outcome of the process and providing assistance rather than
interfering in an employees work.

4. COMPARISON WITH STANDARDS:

The actual performance is compared with the desired or the standard
performance. The comparison tells the deviations in the performance of the
employees from the standards set. The result can show the actual performance
being more than the desired performance or the actual performance being less
than the desired performance showing a negative deviation in the organizational
performance. It includes recalling, evaluating and analysis of data related to the
employees performance.

5. DISCUSSING APPRAISAL WITH THE EMPLOYEES:

79

The result of the appraisal is communicated and discussed with the employees on
one-to-one basis. The focus of this discussion is on communication and listening.
The result, the problems and the possible solutions are discussed with the aim of
the problem solving and reaching at a decision. The feedback should be given
with a positive attitude as this can have an effect on the employees future
performance. The purpose of the meeting should be to solve the problems faced
and motivate the employees to perform better.

6. TAKE CORRECTIVE ACTION, IF REQUIRED:

The last step of the process is to take decisions which can be taken either to
improve the performance of the employees, take the required corrective actions,
or the related HR decisions like rewards, promotions, demotions, transfers etc.

80

F. WAGES, SALARY, PAYROLL SYSTEM OF THE COMAPANY:

Introduction:
The basic purpose of Wages, Salary and Payroll is to establish and maintain an
equal wage and salary structure. It is concerned with financial aspects of needs,
motivation and rewards. Managers, therefore, analyze and interpret the needs of
their employees so that reward can be individually designed to satisfy these
needs.
WAGES:

Wages means all remuneration paid for services rendered by an

individual, including commissions and bonuses and the cash value of all
remuneration paid in any medium other than cash.

SALARY: Salary is a fixed amount of money or compensation paid to an

employee by an employer in return for work performed. Salary is paid, most
frequently, in a bi-weekly paycheck to a professional employee.

PAYROLL: The sum total of all consumption that a business must pay to its
employees for a set period of time or on a given date. Payroll is usually managed
by the department of a business. Small-business payrolls may be handled directly
by the owner or an associate.
In Tulsi Syntex Pvt. Ltd., every employee receives the salary of the current
month in the first week of the next month. Every employee gets a salary slip
from the company as they receive their salary so that it becomes a proof that an
employee has received his salary. The salary is paid by the company through
HDFC bank with the help of ATM Card.
Moreover, the managers receive their salary from the head office of the Tulsi
Syntex Pvt. Ltd. and the rest of the staff receive their salary through a private
workers organization called Private Employment Exchange which provides
81

employees for staff and housekeeping for stores like Tulsi Syntex Pvt. Ltd. The
Tulsi Syntex Pvt. Ltd. follows the Time Wage System all over.
G.

INCENTIVE SYSTEM:

Introduction of Incentives:
Incentives are rewards given to the employees for their good performance and
contribution to the company. Employees get motivated when they receive
incentives and they try to perform better for achieving the companys goal. Tulsi
Syntex Pvt. Ltd. gives incentives on the basis of production.

Definition of Incentives according to the Company:

A cost or benefit that motivates a decision or action by consumers, business
or other participants in the economy. Some incentives are created by
government policies to achieve a desired end.

The Tulsi Syntex Pvt. Ltd. has two types of incentives:

II
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83

1. INDIVIDUAL INCENTIVES:
The individual incentive is given to the individual employee on the basis of the
products sold. The company has already decided the rate of incentives on every
category of products. Every category and product has its own incentive rate.
2. TARGET INCENTIVES:
Another type of incentive is target Incentives which is presently followed in
TULSI SYNTEX PVT. LTD. In this, the group of employees or branches is
given a particular target of the sales which is to be achieved in a given time. If
the branch achieves the target, then the company will provide incentives. The
rate off incentives changes as per the target given. Generally, it is around 3%6%. It is also known as profit sharing for the company and employees.

84

H.

INDUSTRIAL RELATIONS:

Introduction of Industrial Relations:

In olden times, the workers were only counted as a source for achieving decided
goals. But now, the concept of Industrial Relations has changed the scenario.
Industrial Relations have become one of the most complex problems of modern
industrial society. Industrial progress is impossible without cooperation of labors
and harmonious relationships. Therefore, it is in the interest of all to create and
maintain good relations between employees and management.

According to the TULSI SYNTEX PVT. LTD.:

"Industrial Relations is simply the relationship between employer and
employee in order to maintain good relationship with the employees, the main
function of every organization should avoid any dispute with them or settle it
as early as possible, so as to ensure industrial peace and harmony with higher
productivity."
What does a company expects from its employees?
The workers must give justice to expenses incurred by the company on them.
The worker should be loyal to the organization. They must make a good and
prestigious image of the company.
The worker should not leave the job without any particular reason as i.e. will
increase workers turnover ratio which is harmful to the company.
The worker should strictly follow the rules and regulations prepaid by the
company and maintain good behavior with management and other employees.
Every worker holds work by co-ordination and co-operation with others.
Workers should avoid wastage of resources and time and must provide proper
85

attention to the work.

Health Facilities:
The company also takes care of the employees health. The company undertakes
the following activities:

The company organizes the INDUSTRY HEALTH PROGRAMME every

year on 31st may.

The company keeps the FIRST AID BOX in every store.

Company arranges HEALTH CHECK-UP CAMP every year as well.

The company maintains adequate records of each and every employees

health.

It is compulsory for every employee for giving full body check-up once in
year.

86

Production Department

INTRODUCTION:
Production management is concerned with the transformation of inputs into goods
and/or services. Traditionally materials, men and machinery were considered to be the
resource. But present trends show that technology is an important into resource to
production. Technology breakthroughs can control both capital and labor.

MEANING OF PRODUCTION:
Many people have a very limited understanding of production. They believe that
production means consuming or combining various inputs, mainly material, labor,
machine to manufacture another value added product. This view of production is
incomplete. If this idea about production is accepted, a very big segment of economy,
i.e. service sector is kept out of the scope of Production. Hence a Russian writer
Alexander Solzhenitsyn in his novel August 1914 gives another comprehensive
modern definition:
In relation to physical goods, Production means manufacturing an object using
various inputs like raw material, power, labor, capital & machines. In relation to
services, production means discharge of any function which has got some utility.
Modern production management is a multidisciplinary approach which integrates the
knowledge of science, technology, engineering and management. This integration is
possible only through the innovative and creative spirit of man. Modern technology is
immensely complex and knowledge-based requiring manpower of a very high level of
scientific and technical capability. Rapid changes in technology will not only make
competition severe but also uncertain.

87

MEANING OF PRODUCTION MANAGEMENT:

Everett Adams has defined Production Management as, A management of
conversion process in which various inputs like material, labor, machine, &
technical knowledge are converted in value added goods & services.
To say about the scope of Production Management it is wide. Production Management
is applicable to:

Manufacturing sector
Service sector
Retailing & trading
Agriculture
To understand demand forecast of finished goods.
To prepare MPS, MRP & CRP.
To help in capital purchase decision.
To help the management in taking strategic decisions.
To inter-act with other heads of department.

Productivity can be increased by optimum utilization of resources. A high level of

productivity yields more goods at lower costs. This will lead to a lowering in the prices
of goods, and in general improve the quality of life.

Activities Of Production Department:

Production planning in an organization is referred as an involvement of an overall
manufacturing and operating system into finished product.
In Tulsi Syntex Pvt. Ltd., several activities of Production Department are as follows:

Grey Cloth Fabrics receipt at factory

Grey cloth fabrics inspection
Accepted Grey cloth Fabrics sent for Processing after doing necessary formalities
Actual Processing
Processed Fabrics dispatch

88

 ORGANISATIONAL

STRUCTURE

OF

PRODUCTION

DEPARTMENT:
RAW MATERIAL PURCHASE POLICY:
Production Department

Engineering Store
Master

Dyeing MasterPrinting

Color Chemical Store

Assistant Master

Assistant Master

Dispatching Store

In-charge

In-charge

Supervisor

Supervisor

Operator

Operator

Labourer

Labourer

MATERIAL RECEIPT AND MATERIAL ISSUE PROCEDURE :

89

All the textiles industries are not having a same procedure but very simple procedure
for material receipt. At first textile industries are getting raw-material. Raw material
for production is as follows:
GRAY CLOTHS:
Raw material for production of sarees materials are produce in company itself at Jolva
Plant and remaining part of raw-material can be purchase from outside.
For further processing big and small dying mills receives that in material Warping
Machine used for Stretching Polyester Filament Yarn. In this machine the following
procedure can be done.
First of all 1500 p.p. to 1200 p.p. size creel can be build up or beam of that size can be
prepared. Then after draw joms machine stretch polyester filament yarn. In this
machine two procedures can be done i.e. first 130temperature heating the yarn then
80 to 90temperature cold the yarn. So that POY can be converted into FOY (FULLY
ORIENTED YARN). Then after intermingle device binding or beaming the FOY.
Then after this beam send into another process.
Documents related to that are prepared and kept very well so that all the transactions
related to the sarees can be done very easily. This is the simple procedure of receiving
the materials no critical procedure or process is to be followed.

DOCUMENTS RELATED TO MATERIAL ISSUE AND RECEIPT:

In this point we can just write that for material receipt documents related to the receipt
of material is prepared and maintained and in issue documents related material issue is
prepared carefully so that at the time of any other problem it can be presented as the
evidences for all the parties participating in the business.
Documents are prepared orally by the top management, and it is not to be shown to the
strangers or anyone who is an outsiders.

90

PURCHASE PROCEDURE:
Purchase procedure is quite same to that of material receipt procedure but only the
difference is that in material receipt procedure we do not need to give orders related to
receipt, only receipt related documents are prepared. But in the purchase procedure we
have to place the purchase orders and purchase request to the providers and then after
our deal becomes final. All other documents related to the purchase is prepared to keep
records and for evidences also.
When TULSI SYNTEX PVT. LTD. buys row material they get 10 % to 15 %
discount on gray cloth from suppliers.
When TULSI SYNTEX PVT. LTD. buys color and chemical they get 5 % to 7 %
discount from suppliers.

91

 MATERIAL HANDLING EQUIPMENTS:

Material Handling is defined as control movement of material, from receipt, through

storage and production and up to shipment of finished product.

Types & Classes of Material Handling Equipments in the company:

People or manager who design plant layout or material handling system should be
aware of material handling equipments available in the market. There are different
methods by which these equipments can be classified and the Tulsi Syntex follows the
following methods for material handling:
(A)

Classification on the basis of Form of Material:

Solid form (Fabrics):
Hand Carts
Metal Rolls
Trolleys
Liquid form (Water, Colors & Chemicals):
Pipelines
Plastic Tubs or Tanks
Gas and Air form (Gas & Steam):
Pipelines
Cylinders

92

(B)

Classification as per Path of movement:

Whether movement is vertical or horizontal, whether it is a fixed movement or
variable path, the equipment shall be different for each purpose. The firm is having all
two types of path for gas, air and water.
Vertical Path(Air, Gas & Water):
Pipelines
Horizontal Path(Air, Gas & Water):
Pipelines

(C)

Classification as per Starting Point & Destination of Transportation:

Handling is required between two departments, between two locations within a
department and also at one work-station or machine.
Equipments can be classified into two categories according to Tulsi Prints industries.
Inter & Intra Department Handling Equipments(Air, Gas & Water):
Pipelines
Hand cart

(D)

Classification on the basis of Sources of Power:

Equipments can be eclectically, can be powered, powered by any fuel manually, driver
or may be using natural forces like Gravity. There is certain special production
operation which puts restrictions on selection on source of power.
For e.g. on the day of power staggering or at the time of shortage of electric power, the
firm is using diesel operated generators.

(E)

Classification on the basis of purpose of Handing:

There are two broad objectives of handling namely storage and transportation. Storage
device like racks and cupboards to store materials, documents and books etc. and
transportation device like pipelines and hand carts to transport material, gas, air and
water in Company.

PROCESS OF PRODUCTION:
93

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94

1. RAW MATERIAL:

The production process starts as the raw material (grey) enters the factory. First of all
an entry of Grey inward is made in the computer by the in-charge & a job card is
prepared (explained in sales procedure). & a lot no. is assigned to the lot of grey. This
lot no. is the number in which it entered in the Mill. These series starts with a new
financial year & end with its end. This starts from no. 1 & is assigned to first lot that
enters the factory & the process is carried on continuous basis. As the lot enters the lot
no. is assigned.

2. WASHING RAW MATERIAL:

Drum washer is preferred case of obtaining micro quality sarees material of high
shrinkage. Drumming is a process used to make special quality fabric, according to the
Customers demand. First gray fabric is passed through the drum machine.
95

Purpose It is used to relax the tension in the high twisted gray fabrics, to Remove
the impurities; give a well grain effect in high twisted gray fabrics.
Process done in Drum Washer machine:
(Note: chemicals may vary from lot-to-lot)
Color / Chemicals (For 24 Pieces/ Lot) - SBA-100, SCR (Stain Remover), NID
(soap)-300, Soda Ash, HWS (Scoulding)-1.000, SQ (Used for hardness of Water)0.3000, Coustic (According to Weight of lot. Used for reducing weight of cloth),
Oxalic (Renew Chemical)-1.0000, White R (For Whiteness)-0.3000, Formic Acid &
Citric (To Maintain Ph).

Temperature According to the requirements (130 For 24s Lot)

Then unload the drummed fabrics & load in the jet-dyeing machine for below process.
Company has 3 Drum machines.

3. JET DYING:
In the jet dyeing machine, cloth is washed. There are following types of washing:
Normal
Soap Washing
Cleaning
Brighten
Whiten
Purpose - To remove dust in gray fabrics,
wash off impurities of texturing oil,
synthetic sizing materials, Make it more
hydrophobic, and to impart soft and
smooth feel to the fabrics. It also reduces
the weight of fabrics as per the customer requirement.
96

Normal washing and soaping is done either in soft or hard water, where as scouring
and weight reduction processes requires steam. Weight reduction process involves
treatment with oxalic acid for removal of rust and scale. Company has 10 Jet Dyeing
Machine.
4. SEWING AND ROLLING:

Ladies are appointed to sew the grey cloths. When one lot of grey completes, other is
to begin. Then cloths are rolled to make one roll for making printing and further
processes easy.
5. WIDTHS ADJUSTMENT:

97

This treatment gives the stability to fabrics structure and also gives dimensional
stability of fabrics and here the width of the fabrics is also adjusted as per customer
requirement. Stenter machine is used here.
Color / Chemicals PBI (PH Buffer), Critic Acid.
Temperature According to the requirements
Company has 1 Stenter machines which have total 10 chambers.
6. FOLDING AND BATCHING:

After width adjusted, cloth is re-checked in center machine and is set for printing
according to the customers requirement. Here, in machine, folding of cloth and
batching is made according to customers requirement.
7. PRINTING:

Company has 3 Printing Machine, Which is Semi Automatic. It is used to print the
Sarees. In these machines, designed plates are putted and cloths roll is printed. To run
98

this machine, only five to six workers are needed. For exact looking color, colors are
baked at 170 degree.
8. WASHING:

After printing, fabric will be washed in washing kundi with different process and then
send it for further process. Company use different chemicals like hydrocostic, soda,
acidic acid, HCL, NID etc. There are four steps to wash clothes:
1. Soap water
2. Cold water
3. Hit water
4. Cold water

9. DEVELOPING:

99

After washing the printed cloths, Loop machine is used to develop the printed clothes
and give the shining to it. Company has 1 loop machines. To run this machine, near six
to seven workers needed for this. This cloth is then passed to heat setting machine
(Stenter) and rolled on beam for perfect setting.
10. SMOOTHING SAREES:

For smoothing the sarees, company uses Zero-Zero Machine. The treatment is done to
give mechanical finishing to the fabric. The fabrics are made smoother and softer. It is
used first, to iron the clothes for removing the extra color chemical. It burns the extra
liquid of color and makes it smooth. Its capacity to iron the cloth is 20000-30000
meter per day and burns near 3 to 6 kilograms extra liquid color. Company has 1
Zero Zero Machine.
11. FINISHED GOODS:

100

After smoothing the sarees, it has been gathered at one side. One worker or two
workers comes with trolley and put that sarees in trolley and passes that for the next
process, that is to separate the sarees according the customers order and colors of
sarees, too.

Packing:

If the finished goods send to the party without packing, this involves great risk of
goods being damaged during transportation or due to some other reason. Hence
packing is very important. This firm packs their goods & sends to the party. To pack all
the dyed & printed finished goods in bags, this firm uses a bag called as Potla. Potla
is nothing but pack the finished goods in a cloth and tied up its corners tightly. It can
hold the weight up to 20 Kgs. These bags are strong & reliable.
Dispatching:

101

After packing, dispatching is done. In the folding department there is a huge window
facing outside passage of the factory. There the tempo stands. Then the labour put the
finished goods in the tempo through the window. In the mean time the bill is prepare at
account office. This bill is prepared in three copies, one for the party (original), one for
the firm which is signed & returned by the party (duplicate) & last one for the
companys record (triplicate). This bill is passed to dispatcher & then the final good is
transported to partys business place.

QUALITY CONTROL:
QUALITY:
Quality is measure of sum totality of attributes properties/characteristics of a product
or service which impart if functional or aesthetic value so as to satisfy the needs of end
users/customers for a given price paid payable by them.
QUALITY CONTROL:
Quality Control is system of policies, procedures and guidelines which establish and
maintain the specified standards of quality, it includes all aspects of quality such as
R&D (Research and Development), design parameters, inspection and analysis of
current quality levels, future trends and also competitors quality levels, feedback from
field performance of quality, choice of machines, tools, processes, technology etc.,

102

selection and training of production and inspection staff, corrective action and follow
up etc.
IN PROCESS QUALITY CONTROL GUIDELINES:
During its manufacturing process various strict instructions and quality guidelines is
given to the employees related to the quality and quality standards. For this purpose,
sarees are to be observed frequently by quality control peoples to see the half-finished
or semi-finished products.
DOCUMENTS RELATED TO QUALITY CONTROL:
Documents related to quality and quality standards are prepared by quality assurance
people generally and they are assistant dying and printing masters. Quality standards
are decided when orders come from the buyers that what kind of quality they demand
and they want for the suits. Related documents are prepared and maintained very well.
Documents related to following things are prepared shortly:
Colour chart of sarees materials.
Cut of sarees materials.
Clarity of embroidery in sarees materials.
Design of sarees materials.
Smoothness of the sarees
INVENTORY VALUATION METHODS:
Most of the sarees materials value is decided by its colour chart, clarity, fabrics,
smoothness, cut and design. Valuation method is important in the business of textiles.
Because most of the sarees value depends on colour chart, clarity, fabrics,
smoothness, cut and design and these 3cs are decided by quality assurance department
at raw material level. Only this valuation method is used at everywhere in the textiles
industries. In some rare cases quality standards are also taken into consideration and
after that price or value of saree is determined.

MAINTENANCE POLICY:
103

For this, in small scale factories, only top management is doing maintenance planning
by observing the various tools and techniques of producing the sarees and technical
machine of producing the different types of sarees and if any damage or any problem
is seen then repairing is done on weekly basis and oiling is also done on monthly basis
so that maintenance can be done very well of tools and techniques.
In the TULSI SYNTEX, supervisors are appointed to observe the tools and techniques
of printing and if damage is seen or problem is found then it is to be repaired and
problem is solved.
Apart from that monthly or quarterly basis repair is provided to the machines and tools
whether there is a problem or not. Strict observation is conducted and employees
complaint is taken into consideration.

STORAGE DEPARTMENT:
Since it is a textiles industry accept raw-material of suits and other tools which are
very few in numbers no extra tools and equipments are required. So, fewer inventories
of raw-material and tools are required to prepare the sarees. And also there is no any
benefit or advantage of keeping huge inventory as compared to the other industries
because hardly it occurs that prices of sarees raw material goes up, it also does not
make any difference if prices goes up. Because, according to higher price the finished
products of the sarees will be sold also by proper control on inventories.
But still it can be said that it depends on managers experience and skills otherwise
implementation of ABC inventory control system is better than other system because it
is only the inventory control system which can be implemented in sarees materials.
TULSI SYNTEX is following this system:
The storage department of TULSI SYNTEX is in company, so it is not far from the
company. There are three godowns in the storage department. First is for raw material
(grey), second is for dyeing cloths and third is for finished goods.

CLASSIFICATION OF INVENTORIES ACCORDING TO ABC ANALYSIS:

104

 ABC ANALYSIS:
The ABC analysis is based on the proposition (1) managerial time and efforts are scare
and limited and (2) some item of inventory are important than others. The ABC
analysis classified various inventory items in to three sets or groups of priority and
allocates managerial efforts in proportion of priority. The most important item are
classified as class A, those of intermediate importance are classified as class B and the
remaining item are classified as class C. the financial manager should monitor
different items belonging to different groups in that order of priority. Almost attention
is required for class A, followed by item in class B and then remaining item in class C.
Group A: It Includes those item which are very important and of high value but form
use a small proportion of total quantity of inventory.
Group B: It includes those items which are less important and low value but form use
large proportion of item then group A.
Group C: The remaining items must be placed in category C.

INVENTORY OF TULSI SYNTEX:

Yarn
Gray Fabric
Spin Fine Oil
Polyester Chips
Chemicals & Additives

IMPLEMENTATION OF SYSTEM:
Step: 1: A list of all items must be prepared in order to determine how many items is
there, what the consumption of each of them is and what is the price.
Step: 2: Calculate total cost by multiplying items price with number of units of
consumption.
105

Step: 3: Ranks must be given to each item on the basis of total value as calculated in
step 2. First rank must be allotted to the items having highest value and this way the
rank must be given in descending order.
Step: 4: Determine the % of each item. Firstly % of no. of each item with total number
and secondly % of total value of each items with total of all items.
Step: 5: All items must be grouped into A, B, C categories.
Grou
p
A
B
C

No. of item (In % of total no. of

Value of item (in % of total value of

items)

inventory)
25
35
40

77.49
19.51
3

ABC Analysis

% of Total No. of Items

% of Total Value of Inventory

0
100
25
60
0

WASTAGE CONTROL:
Tulsi Syntex is a job-shop industry. Company produces fabrics according to demand of
Customers. Demand for fabrics varies from customers to customers. So, according to
the customers demand, production is made and generally wastage happens.
Wastage is nothing but, during the production process, anything lost by waste, any
material unused and rejected as worthless or unwanted. During the production,
company used chemicals for various purposes that were filled in barrels. After using
that chemicals that barrels are useless for the company. Company also uses water for
some processes in production and after water used in machines with color chemicals,
that processed water is useless for the company.
There are mainly two types of wastages that are described as follows:
1) Controllable Wastage: Wastage that can be controlled and reduced by recycling
that wastage and re-use that object for the same or another purpose. Tulsi Syntex

106

has barrels/waste plastic tubs in this category. So company sold that to CETP
(PAL) for recycling that tubs and re-use for filling chemicals.
2) Uncontrollable Wastage: Wastage that cannot be control or avoid is called
uncontrollable wastage. Here, waste water and cloths are included in this category
by the company. These wastes are useless for the company to re-use for any
purpose. So waste water is thrown by pipeline. And cloths are fired by fire pipe in
air.

As we can see in above pictures in the Tulsi Syntex waste water of the dyeing
process is thrown away by pipeline.
The waste cloths fired by fire pipe in air.
Waste plastic tubs of chemicals are sold to CETP (PAL).
Company pays tax to Surat Municipal Corporation (SMC) for processing waste
water and air pollution monthly.

107

Marketing Department

MARKETING ENVIROMENT:

INTRODUCTION OF MARKETING:
Marketing is the process of planning & executing the conception, pricing, promotion
and distribution of ideas, goods and services to create exchanges that satisfy individual
and organization goals.
The important responsibilities of the marketing department are:
Volume sales: Total production to be sold in each season.
Price realization: Selling price at level to the consumer (farmer) at MRP.
Cost of marketing: Discounts, credit, distribution expenses, traveling and
communication & warehousing expenses, advertising& sales promotion expenses,
etc should be minimum.
The marketing efforts are mainly projected to satisfy the needs and wants of the target
markets. It is more important to judge the weight age to be given, while fulfilling the
set organizational goals, to the customers and society. Surat is known as textile city of
India. There are so many large and small-scale units in Surat as well as other cities of
India. In todays competitive world, marketing is the only a tool that brings ahead in
competition.
Marketing management is an important functional area of business management. It is
the part of the organization, which facilitates the flow of goods and services from the
producers to the ultimate consumers. It has to build up appropriate marketing plan or
108

marketing mix product, price, promotion and distribution place to fulfill the set goals
for business. It has to formulate sound marketing policies and programmers. It looks
after their implementation and control.

Marketing:
Marketing is a social and management process by which individuals and groups
obtain what they need through creating and exchanging products and value with
others.
-Philip Kotler

Marketing Management:
Marketing Management means analyzing, planning, implementing and controlling
the marketing activities with the objective of making the desired exchange mutually
advantageous to the seller and the buyer.
-Philip Kotler

IMPORTANCE OF MARKETING:
Marketing management is a process.
The process consists of analyzing, planning, implementing and controlling of
marketing activities.
It covers marketing of ideas, goods and services.
It is concerned with exchange of ideas, goods or services.
The exchange should be mutually being advantages to the seller as well as buyers.
It tries to achieve organizational objectives by satisfying the needs of the
consumers with delight.

In this company finance assists marketing activities by providing incentive schemes,

free gifts, literatures, etc for promotional activities. It is useful in exploring and
109

making a place in the competitive market. The companies distributors have to bare the
major marketing expenses as they are given the responsibility of Promoting TULSI
SYNTEX products.

110

ORGANISATIONAL

STRUCTURE

OF

TULSI

SYNTEX:

Marketing

Dyeing

Master 1

Printing

Master 2

Master1

Master 2

Contractors

Workers

The main and the most important person of the marketing department is the master and
he is the only person who is responsible for the grey material inward till the collection
of the amount of the job work done on the grey cloth. He only maintains and develops
111

new designs and ads to the creation world. He handles the customers and helps them
in finalizing the color and various designs on their product. He is responsible for any
damage to the cloth and is answerable to the customer. He visits the markets and
studies the new designs and concepts and then develops them in the own department.
He can be said to the sales manager of the marketing department. He is responsible for
customer satisfaction & if there is any query then he personally solve them by visiting
them at their place and personally.

SEGMENTATION, TARGETING & POSITIONING:

SEGMENTATION:
The market segmentation is mentioned
as being one of the key elements of
modern marketing and, Sir Philip
Kotler and Armstrong define market
segmentation as,
Dividing a market into distinct
groups of buyers who have distinct
needs, characteristics, or behavior
and who might require separate
products or marketing mixes.
Tulsi Syntex produces sarees, so it concentrates on women segment.

TARGET MARKETING:
Marketing experts Philip Kotler and Gary Armstrong define target market as a set of
individuals; sharing common needs or characteristics that the company decides to
serve. These individuals are usually the end users of a product. A cloth manufacturer
target market may be environmentally minded married wives.
112

The TULSI SYNTEX PVT.LTD.

targets
Company

the

customers

made

the

status.

sarees

of

different prices according to the

status of the customers.

POSITIONING:
Positioning is not what you do
to a product; it is what you do
to the mind of a prospect.
Philip Kotler and Nancy R. Lee
described positioning as,
"The act of designing the organization's actual and perceived offering in such a
way that it lands on and occupies a distinctive place in the mind of the target
market."
The TULSI SYNTEX PVT.LTD produces the sarees according to customers
requirement and market competition. So, they created good positioning in the minds of
customers and retailers and sell its products to every retailers shops and made
available everywhere in the market. Some of the retailers prefer only this
companys products, too.

113

 ORGANISATION BUYING BEHAVIOUR:

Organization buying behavior is the buying decision making process by which the
formal organization indentifies its needs for products, raw materials and identifies,
evaluates and chooses among alternative brands and suppliers with an objective of
sharpening its competitive edge.
From the above definition it is clear that industrial buying is the organizational buying
and buying behavior implies different stages of decision making process. Different
stages of decision making process includes identifying and quantifying the needs of
the organization, identifying the alternative suppliers and their alternative brands,
evaluation of alternatives and making buying decision by selecting appropriate
supplier and brand.

Steps:

114

 On the basis of the production schedule, the production manager prepares indent and
sends it to the marketing manager informing about the requirement of raw material.
The purchase department confirms the venders on the basis of his volume of
business and price, quantity and services.
According to the need of buyers grey cloth is purchased, if the requirement is large
then grey cloth is purchased in large sum, if the order is normal then it is purchased
accordingly. TULSI SYNYEX keeps stock of grey cloth in the mill.
For producing different types of clothes, the basic raw material is oil, colors, threads,
stones etc. so they plan and the company contacts certain loyal suppliers. They also
purchase raw material online by ordering.
After placing order, material is supplied to the plant.
Such received material is called for testing so it is send to the quality control
department. Quality control department checks such materials and discards the bad
quality raw materials if any.
After checking the Quality control department issues one letter of quality
information that shows the material is as per specification.
Finally the raw material is transferred to the store department.
The budget of the purchase department is based on the procurement and marketing
forecast and production forecast of last year. The budget of the department is
affected by the fluctuation in the process of raw materials. For the purchase of the
capital goods like machines and other goods, a meeting is held. In the meeting the
members decides for the purchase and from whom to purchase. They study intensely
on the net and several other sources to find and gain knowledge of new technology
and great quality.
115

 CONSUMERS BUYING BEHAVIOUR:

Consumer behavior is a decision process cum physical activity of making a purchase.
The ultimate purchase activity is preceded by many psychological processes consisting
of interplay of several variables; some of the variables also affect the consumer
behavior after the purchase is made. The mental processes affecting buying behavior
and resulting into the final purchases action may be quick and simple. On the basis of
this primary discussion we can define consumer behavior as under.
Consumer buying behavior may be defined as the acts of individual in obtaining
and using a product or services including the decision processes that precede and
determine these acts."

NEED TO UNDERSTAND:
A) Why consumers make the purchases that they make?
B) What factors influence consumer purchases?
C) The changing factors in our society.

A FIRM NEEDS TO ANALYSE BUYING BEHAVIOUR FOR:

A)

Buyers reactions to a firms marketing strategy has a great impact on the firms
success.

B)

The marketing concept stresses that a firm should create a Marketing

Mix (MM) that satisfies (gives utility to) customers, therefore need to analyze the
what, where, when and how consumers buy.
116

C)

Marketers can better predict how consumers will respond to marketing

strategies.

A) Problem Recognition (awareness of need) :

Difference between the desired state and the actual condition. Deficit in assortment of
products. Difference between the desired state and the actual condition. Deficit in
assortment of products. Hunger--Food. Hunger stimulates your need to eat.
Can be stimulated by the marketer through product information--did not know you
were deficient? I.E., see a commercial for new saris, stimulates your recognition that
you need a saris.

B) Information search:
Internal search, memory.
External search if you need more information. Friends and relatives (word of mouth).
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 Marketer dominated sources; comparison shopping; public sources etc.

A successful information search leaves a buyer with possible alternatives, the evoked
set.

Consumers find types of sarees:

1. Bandhani
2. Embroidered Tinsel Sarees
3. Symar
4. Synthetic
C) Evaluation of Alternatives :
Need to establish criteria for evaluation, features the buyer wants or does not want.
Rank/weight alternatives or resume search. May decide that you want to purchase
bandhani and Embroidery so gets rank.
If not satisfied with your choice then returns to the search phase. Can you think of
another shop? Look in the Sylmar etc. Information from different sources may be
treated differently. Marketers try to influence by "framing" alternatives.
D) Purchase decision :
Choose buying alternative, includes product, package, store, method of purchase etc.
E) Purchase :
May differ from decision, time lapse between 4 & 5, product availability.
F) Post-Purchase Evaluation :
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Satisfaction or Dissatisfaction, Cognitive Dissonance, have you made the right

decision. This can be reduced by warranties, after sales communication etc.
After purchase synthetic, may think that really you wanted a bandhani.

4 P`S OF MARKETING:

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PrPl aoi cdmeuoc ti o n

(A) PRODUCT :

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 INTRODUCTION:
In a board sense a product is something that is viewed as capable of satisfying a
human need. It is everything which is concerned with satisfaction of a need. A product
means sum total of physical object and tangible and intangible attributes, prestige of
the producer and distributers, personalities and other related service. All these
combined together constitute product which is accepted by consumer to satisfy his
need.
A set of attributes in the form of physical
product or services and ideas offered to the
consumer for the satisfaction f his needs. It
includes physical product, services, ideas,
personalities, place and organization.
-Philip Kotler
In product includes following aspects:
Varity
Quality
Size
Features
Services
Brand name
Packaging
Labeling

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 PRODUCT MIX:
A product is anything that can be offered to a market to satisfy a want or need.
Every firm whether it is a manufacturing or a trading unit or service sector, has its own
product mix.
A product mix is the set of all products & items a particular seller offers for sale.
A product mix is the set of all products and items a particular seller offers for sale. A
product mix consists of various product lines. A companys product mix has a certain
width, length, depth, and consistency.
The width of a product mix refers to how many different product lines the company
carries.
The length of a product mix refers to the total number of items in the mix.
The depth of a product mix refers to how many variants are offered of each product in
the line.
The consistency of the product mix refers to how closely related various product lines
are in end use, production requirements, distribution channels, or some other way.
The basic product of all textile related manufacturing unit is cloth. This cloth is of
various qualities. & these qualities form the product mix of the firm. Every Dyeing
and Printing Mills product is to Dye and Print on the cloth according to the order of
the marketer. TULSI SYNTEX product is to Dye and Print on the cloth according to
the order of the marketer. According to the order of the marketer, the TULSI SYNTEX

does their work on the basis of their order and fulfills their order on the given time.
Types and Classification of Products:
TULSI SYNTEX sells different types of fabric products and the classification is given
below:
Printed Sarees
PRODUCT LIFE CYCLE:

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A companys positioning and differentiation

strategy must change as the product, market
and competitors change over the product life
cycle. To say that a product has a life cycle is
to assert four things:
1.

Introduction

2.

Growth

3.

Maturity

4.

Decline

1. INTRODUCTION:
With marketing of a new product the first stage of life cycle known an Introduction
begins. During this stage the product is new in the market is new in the market and a
large number of customers are not familiar with it. Therefore, volume of sales is very
small in the beginning. During this stage in order to increase the sale the company
has to insure advertising expenditures on a large scale, sales representatives are also to
be appointed , incentives are to be given to them and for successful entry in the
competitive market price is also to be kept low. The time span of this stage will be
short if the product is quite consistent with customers demand otherwise it is likely to
be long. Tulsi Syntex had appointed sales representatives and sold products with 5%10% discounts at this period.
2. GROWTH:
The stage begins with the increase in the growth rate of sales and earning profit. If the
product is consistent with consumer preferences, within a short period of time growth
rate of sales begins to increase. Customer satisfied with first purchasing continues to
purchase and canvass for the product amongst other customers. During in this stage
profit is at its highest level. In this way during growth stage the product begins to
make rapid sales gains because of the cumulative effects of introductory promotion,
distribution, and word of mouth influence.

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3. MATURITY:
In this stage sales growth continues but at a declining rate because of the diminishing
number of potential customers who remain unaware of the product. During the
maturity stage market becomes highly competitive. TULSI SYNTEX has reached
the maturity stage in its products life cycle.
4. DECLINE:
In this stage sales begin to diminish absolutely as the product is gradually replaced by
better products or substitutes. Generally because of changing preference of customer
or losing utility product sales reach this stage of decline.
The growth stage is marked by a rapid climb in sales. Early adopters like the product
and additional consumers start buying it. New competitors enter, attracted by the
opportunities.
Prices remain where they are or fall slightly, depending on how fast demand increases.
Tulsi Syntex maintains their promotional expenditures at the same or at a slightly
increased level to meet competition and to continue to educate the market. Sales rise
much faster than promotional expenditures, causing a welcome decline in the
promotion-sales ratio.
In the growth stage TULSI SYNTEX improves product quality and adds new product
features in the product. In this stage the Mill can also increases its distribution
coverage and enters new distribution channels. TULSI SYNTEX lowers its prices to
attract the next buyer of price-sensitive buyers.
TULSI SYNTEX is earning high profit and high market share in this growth.

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 PACKING AND LABELING:

PACKING:
For semiconductors, packing serves two important functions. The first and most
obvious function is protection during storage and transport to customers. This, of
course, applies to all products, not just semiconductors. The second is to act as a
delivery medium for automatic placement machines during equipment manufacture.
To do this effectively, the reels, trays and tubes that components are packed in must
meet recognized standards. In this respect, NXP Semiconductors actively cooperates
with standardization authorities throughout the world.

TULSI SYNTEX defines packaging as all the activities of designing and producing
the container for fabrics. The container is call package, and it improves up to three
levels of fabric. First level is primary package, second level is secondary package and
third level is shipping packaging. In TULSI Prints, the first level of packaging is
plastic bag packaging, second level of packaging is to pack in the cardboard boxes and
third level packaging is to pack the card boxes into container.

LABELING:
Labeling is concerned with brand and packing. Label is a strip on the container or
packing in which certain instruction regarding the function and uses are printed. This
instruction serves the purpose of communication and promotion. The instructions on
the label make the brand simple and easy. It increases the satisfaction of the consumer.
We see such labels on the bottle of liquid medicine.
Labeling is that part of the marketing which identify the different product of different
Dyeing and Printing Mill.
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In the labeling TULSI SYNTEX indicates its company name and logo on the packing
boxes.
BRAND:

MEANING:
Brands

means

a
a

name,

term,

sign,

symbols

or a combination of these intended to identify the goods or services of one seller or

groups of seller and to differentiate them from those of competitors.
A brand is a sellers promise to deliver consistently a specific set of features, benefits,
and services to buyers. The best brands convey a warranty of quality.

IMPORTANCE OF BRAND:
It is easy to identify the product.
The brand gives a separate identify to a product and from competitors.
Brand can be trade mark.
Brand gives legal protection.
The producers can be a symbol of quality.
Price difference can be possible by brand.
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(B) PRICE:

INTRODUCTION:
In ordinary usage, price is the quantity of
payment or compensation given by one party to
another in return for goods or services.
In all modern economies, the overwhelming
majority of prices are quoted in (and the
transactions involve) units of some form
of currency. Although in theory, prices could
be quoted as quantities of other goods or
services this sort of barter exchange is rarely
seen.
Price can sometimes alternatively refer to the quantity of payment requested by a seller
of goods or services, rather than the eventual payment amount. This requested amount
is often called the asking price or selling price, while the actual payment may be called
the transaction price or traded price. Likewise, the bid price or buying price is the
quantity of payment offered by a buyer of goods or services, although this meaning is
more common in asset or financial markets than in consumer markets.
In price includes following aspects:
List price
Discount
Allowances

127

 Payment period
Credit terms

Price is the element of the marketing mix that creates sales revenue, the other
element is cost.
-Philip Kotler

OBJECTIVES OF PRICING:
Maximize long-run profit
Increase sales volume (quantity)
Increase market share
Company growth
Maintain price leadership
Discourage competitors from cutting prices
Avoid government investigation or intervention

METHODS OF PRICING:
TULSI SYNTEX follows Cost oriented pricing type of pricing policies. They are as
under:

Cost Oriented pricing:

A) It is simple way of setting the price. They keep following costs in the mind at the
time of deciding:
(1) Production Cost
(2) Distribution Cost
(3) Transportation Cost
Company adds 10% to 14 % profit on total cost and then decide price.

128

B) A different type of sarees is different prices. Thus TULSI SYNTEX has no fix
price of all sarees. Many factor affecting pricing policy like Business fluctuation,
demand, types of suits, color, clarity, quality, etc.
C) Sarees price allocated to its color charts, clarity, grinding, cut and its design etc. the
sarees cut, design, color chart, clarity and grinding are good. So its price also high
in another suits.

(C) PLACE:
INTRODUCTION:
"Channels of distribution are the different paths that goods passed through in
moving from the producer to the consumer."
Ever expending horizons of the market give rise to problem of channelizing the
product form the place of its manufacture to the place of consumption. For the
distribution of goods different alternative are available. But each has cost. Therefore,
due care need to be exercised at the time of selecting a channel of distribution.
A channel of distribution means a system of consisting of different marketing
intermediaries through which products or service are distributed from one place of
manufacturer to the utilities consumer.
In place includes following aspects:
Channels
Coverage
Assortments
Locations
Inventory

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aMnfcRilAgCustomer

LEVEL OF CHANNEL OF DITRUBUTION:

Zero level Channel:

In between manufacturer and consumer there is no middlemen and therefore it is

known as zero level channel. Manufacturer is directly selling to the consumer.

One level Channel:

This channel consists of one middleman between producer and consumer and is also
known as one level cannel.

Two level Channel:

This is two levels channel in which to middleman are working. Producers sell to agent,
the agent seals to retailer to consumers.

Three level Channel:

This channel consists of three levels channel and is having there middlemen. In this
channel producers sells to an agent to wholesaler and wholesaler to sells to retailer and

retailer to the consumer. Sometimes producers appoint different agents for different
product line.

130

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ua
r

MnacfReritlCuoms
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cr

et

A
g
en

W
h
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R
e
ea

t
ri

C
u
mt
e

TULSI SYNTEX uses only one level distribution channels which are given below:

Company does only Job works. Company gets order from traders from textile market
and done process of Dyeing and Printing.
ACTIVITES OF DISTRIBUTION:

TRANSPORTATION:
Transportation Concepts is committed to providing the highest level of service to meet
your transportation needs. Servicing a number of companies and communities, we
look forward to solving your transportation issues in a timely and cost-effective
manner.
Throughout the past 24 years, Transportation Concepts has built its own outstanding
reputation as a customer centered, quality provider of contracted transportation
services. A foundation of the companys success is a dedication to the goal to
consistently meet and exceed clients expectations.

131

s
r

In TULISI SYNTEX the transportation of Raw material and Finished goods is done

through trucks.
SERVICES:
At Concept Services we work with companies that have a need to increase sales and to
improve their sales processes. All of our clients have one thing in common; they all
have a need to generate new business from new customers. In a business economy of
constant change, trying to do more with less, downsizing, and the need for increased
sales and efficiencies, Concept Services has evolved. We help companies to be more
proactive in their sales approach and to flatten the highs and lows of seasonal sales or
an ineffective sales force.
Concept Services is about sales. We are not providing a product. What we provide is a
"concept" that is executed as a service and is gauged by the success of our customers.
The TULSI SYNTEX provides the better services by producing the better quality of
sarees according to customers requirement.
MARGINS OF CHANNEL PARTNER:

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Channel partnerships provide an opportunity for companies to promote certain

products or services. In return, channel partners receive access to product marketing
and training, discounts, technical support, lead generation tools and beta versions of
releases. A VAR that chooses to partner with a vendor may lose a certain degree of
independence with respect to other vendors in the same market. As a result, these
relationships make sense only when the increased access and support result in greater
revenue for the channel partner. Several vendors have created online forums,
discussion groups and social networking sites to encourage and support channel
partnerships.

AFTER SALES SERVICE:

If any service is required by the customers after sales, it is provided by the
manufacturer or local dealer on behalf of the manufacturer. The TULSI SYNTEX
provides the good after seals service by the replacement of bad products.

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(D) PROMOTION:
INTRODUCTION:
So far we learnt that in the field of marketing, a marketing manager has to make
proper decision regarding product planning, channel of distribution and pricing. But
that is not enough. In order to make this decision fruitful he has to make proper
decisions regarding promotion also. Without promotional measures we cannot expect
any marketing manager to reap a rich harvest. Promotion is concerned with increasing
sales stimulating demand. Success of promotional programmes depends on the
effectiveness of communication.
Promotion means a set of efforts made by the company for stimulating the demand
for its product or products without making any alternative in product mix, price and
channel of distribution.
In promotion includes following aspects:
Sales promotions
Advertisement
Sales force
Public relation
Direct marketing

TULSI SYNTEX is not having any promotional or advertising policy in the

organization. The company has just given their contact numbers in the textile phone
directory. No other promotional or advertising is being done in the organization. The
company prints yearly calendars and distributes it to its Customers.

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In this part of marketing mix we examine and the nature and use of four promotional
tools- advertising, sales promotion, public relation and publicity, personal selling and
direct marketing. We examine both traditional and online forms of these tools and we
look at the advantages of all the topics.
In TULSI SYNTEX, they use following Promotional Policy:

PROMOTION POLICY:
A TULSI SYNTEX has only one thing which they can present as promotion and this
thing is Price discount is given in following way:
A. If the customer is regular.
B. If he want to purchase in bulk quantity.

ADVERTISING:
Advertising is any paid from of non-personnel presentation and promotion of ideas,
goods or services by an identified sponsor.
TULSI SYNTEX in manufacture unit advertising is easily possible. The sale
promotion is doing. Thus, in sales promotion TULSI SYNTEX gives particular suit
and sarees, TULSI SYNTEX banner & tags, and gives small gifts to their regular
customers.

EXPORT MARKETING:
Exporting is frequently used to enter new markets. Businesses selling products enter
into an agreement with an agent, distributor or a trading house for the purpose of
selling (or marketing and selling) the products in the target market. Due diligence is
critical when selecting an agent or distributor for indirect exporting. Western
Economic Diversification Canada has published a valuable checklist on selecting a
foreign agent or distributor in its publication Ready for Export: Building a Foundation
for a Successful Export Program. An adaptation of this checklist is found in Team
Canada Incs A Step-by-Step Guide to exporting (see below for more information).
135

TULSI SYNTEX not uses the export marketing.

136

 SALES PROCEDURE:
The sales procedure of TULSI SYNTEX is very straight and simple. They are just
supplying the finished products of suits and sarees to their consumers and according to
the trends in the markets and customers. First of all they are receiving the order from
their customers and according to preferences of their customers; they are just
supplying the suits and sarees.
Above is the straight and simple procedure of supplying and selling the suit and sarees
but according to locations and segmentations of the market they change their selling
and supplying procedure.

SALES PLAN PREPRATION:

TULSI SYNTEX forecast about sales that during festivals like Diwali, Mohram,
Holi and other same festivals high demand of Fancy suit and sarees. If competition
is high company make effort the increase sales. And if business fluctuation is
depression in business cycle then sales will be reduced. Consider this factor, they
estimate future sales, and prepare the sales plan.

1) Customer or retailer sends the order to the companys offices.

2) Sales manager show that sample of suit and sarees according to order is available
or not.
3) If not, than inform the production unit to customer.
4) Sales manager send his sales executive to supply the suit and sarees parcel with
bill.

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 COMPETITIVE ANALYSIS:

INTRODUCTION:
Business competitors are as follows:

Other organizations offering the same product or service now.

Other organizations offering similar products or services now.
Organizations that could offer the same or similar products or services in the
future.
Organizations that could remove the need for a product or service.

COMPETITORS DETAILS:
There are some of the major competitors of the TULSI SYNTEX. They are as under:

Parag Sarees & Exports

Omega Exports
Gupta Exports
Garden Textiles
Kanishka Prints

There are four stages in monitoring competitors - the four Cs:

138

 Collecting the information (with a first stage - deciding what to collect).

Converting information into intelligence.
Communicating the intelligence.
Countering any adverse competitor actions - i.e. using the intelligence.

139

ANNEXURE
PROFIT & LOSS ACCOUNT OF TULSI SYNTEX

140

BALANCE SHEET OF TULSI SYNTEX PVT. LTD.

BIBLIOGRAPHY

141

1.

DATA PROVIDED BY THE TULSI SYNTEX PVT. LTD.

2.

Websites:

http://en.wikipedia.org/wiki/Pricing_
http://transportation-concepts.com/
http://www.conceptservicesltd.com/
http://searchitchannel.techtarget.com/definition/channel-partner
http://www.mbaknol.com/business-finance/the-concept-of-cash-management/
http://www.udel.edu/alex/chapt6.html#what
http://sbinfocanada.about.com/od/canadaexport/a/10exportsteps_2.htm
http://www.oup.com/uk/orc/bin/9780198775768/freelecturer/manual/imchap1

6.pdf
http://az-marketing-consultancy.blogspot.in/2012/01/market-segmentationaccording-to-sir.html
http://www.ehow.com/about_6747097_difference-target-market-targetaudience.html
http://cbu-socialmarketing.wikispaces.com/Benefit-focused+Positioning
3.

Books:

K. Aswathapa (2005) - Human Resource and Personnel Management

Page No. : 64, 132, 156, 194, 226, 299, 505, 508, 520, 226, 299.
N. D. Gami (2009-10) - Marketing Management
Page No. : 7, 8, 38, 51, 70, 81, 86, 106, 126, 133.

N. D. Gami (2009-10) - Financial Management

Page No. : 6, 30, 195.

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