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Project Report

Strategic Management of Kohinoor Mills Limited

Project Report Submitted To:

Dr.Kamran Azam Khan

Project Report Submitted By:

Raja Asad Mehmood (7620)

Shakeel Ahmed (7372)

Muhammad Umer (7374)

Date : , December, 2013

Riphah School of Leadership

Faculty of Management Sciences

Riphah International University

Islamabad


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Table of Content

Introduction .................................................................................................................................................. 1

................................................................................................................................................................... 2

Type chapter title (level 3) .................................................................................................................... 3

Type chapter title (level 1) ........................................................................................................................... 4

Type chapter title (level 2) ........................................................................................................................ 5

Type chapter title (level 3) .................................................................................................................... 6


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CHAPTER 1

1.1 IntroductionIn this project we are explaining the application of strategic management on industry level. The

relation of strategic management with different organizations and companies is more important

due to easily understand the strategic management. In this project we are also applying the

strategic management concept on Kohinoor mills limited. The concept of selection,

implementation & evaluation is very easy in the level of studying but these implementations on

industry are very difficult. In this project we are covering the area of finance, marketing, sales,

strategies implementation and evaluation of Kohinoor mills limited with the help of basic

research. After completing the project we will give some suggestions for researchers, managers

and teachers.

In this first chapter we are covering the introduction of our project and then the main objectives

of project in which we were discussing why we are implementing the strategic management in


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industries, impact of textiles industries in the economy of Pakistan since 1947. The main issues

and problems of this industry are explained for better study and to take the step for solution of

these problems. At the end of chapter whole summary is discussed.

1.2 Overview of IndustryKohinoor textile Mills Ltd is part of Kohinoor Maple Leaf Group, which was born from the

Trifurcation of the Saigol group of companies and is a reputable and leading manufacturer of

Textiles and cement. KMLG comprises of Kohinoor Textile Mills limited (KTML) and Maple

Leaf Cement factory limited (MLCF). Both companies are incorporated in Pakistan and are listed

on three stock exchanges of the country. KTML was established in 1953 at Rawalpindi and is

one of the oldest companies of Pakistan with over 50 years experience in textile manufacturing.

It was initially set up as a spinning and weaving project with 25,000 spindles and 600 looms.

However, after decades of aggressive expansion and modernization KTML has emerged into a

fully vertically integrated home textiles company with state of the art capabilities for spinning,

weaving, dyeing, printing and stitching. The company has a diverse customer base with sales in

both the local and export markets. The main international markets include Asia, Europe, USA

and Australia.

Kohinoor Mills Limited's vision is to achieve and then remain as the most progressive and

profitable textile organization in Pakistan. Incorporated in 1987 as a small weaving mill, today

Kohinoor Mills broadly undertakes three major businesses, weaving, processing, and power

generation. It has, and continues to develop, a portfolio of businesses that are major players

within their respective industries. Bringing together outstanding knowledge of customer needs

and leading edge technology platforms, your company undertakes to provide superior products to


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its customers. With an annual turnover of over Rs. 6 billion, today Kohinoor Mills Limited

employs over 1,500 employees. It aims to create superior value for Kohinoor's customers and

stakeholders without compromising its commitment to safety, environment and health for the

communities in which it operates. Its products range from greige fabric to processed fabric.

(KTML, annual report, 2012).

Kohinoor Mills Limited with its state-of-the-art facilities spread over an area of 103 acres is

located at 8th KM Manga Raiwind Road near provincial capital city Lahore. Kohinoor Mills

Limited is one of the largest vertically integrated textile manufacturers, started its successful

journey back in 1949. The company has achieved annual sales of US$ 140 million to customers

based in Americas, Europe, Africa, Australia and Asia. We have diversified products and

engaged in manufacturing of Grieg and Dyed Fabrics exported to major brands and retail chains.

Kohinoor Mills Limited has employed a highly qualified and technically trained workforce of

1500 people working as a closely knitted family based on corporate culture, values and beliefs.

Our team is capable of taking on challenges for fulfilling every work related task with dynamism

and dedicated efforts.

(http://www.kohinoormills.com/page.php?section=Main&page=AboutKWML,02-12-2013, 7:35

pm.)

The focus is to create a seamless interface throughout the manufacturing process addressing

delivery, cost and quality issues by providing the right product the first time, and at the right

time. Lead time follow up from order placement to delivery of goods to the customer is the focal

point of the apparel division. With extensive investment into systems right from order taking and

procurement through to production and delivery, efficient planning is being done to achieve
http://www.kohinoormills.com/page.php?section=Main&page=AboutKWMLhttp://www.kohinoormills.com/page.php?section=Main&page=AboutKWML


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better lead times to the satisfaction of the ever growing customer demand. The support from in-

house fabric weaving and dyeing gives a new concept and satisfaction to the customer for

attaining quality under the same roof a better production lead time making us able to deliver the

full package. Apparel Division places the highest emphasis on manufacturing its apparel

products with consistent by incorporating efficient and flexible processes to ensure customer

satisfaction. Total Quality management is achieved through effective control and continuous

improvement of every process. (KTML, annual report, 2012).

MISSION & VISION STATEMENT

The Kohinoor Mills Limited's stated mission is to become and then remain as the most

progressive and profitable company in Pakistan in terms of industry standards and stakeholders

interest. The Company shall achieve its mission through a continuous process of having sourced,

developed, implemented and managed the best leading edge technology, industry best practices,

human resource and innovative products and services and sold these to its customers, suppliers

and stakeholders.

Business Activities

The Company is principally engaged in the business of textile manufacturing covering weaving,

bleaching, dyeing, buying and selling and otherwise dealing in yarn, cloth and other goods and

Fabrics made from raw cotton and synthetic fiber and to generate, distribute, supply and sell

electricity.

CODE OF CONDUCT

Introduction to the Code


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This code has been formulated to ensure that directors and employees of the Company operate

with in acceptable standards of conduct and sound business principles which strive for

development and growth. The Company takes pride in adherence to its principles and continues

to serve its customers, stakeholders and society.

Contents

This code identifies the acceptable standards under following headings:

Core values

Business culture

Responsibilities

Core values

The credibility, goodwill and repute earned over the years can be maintained through continued

conviction in our corporate values of honesty, justice, integrity, and respect. The Company

strongly believes in democratic leadership style with fair, transparent, ethical and high

professional standards of conduct in all areas of business activities.

Business culture

Operations

The Company shall formulate and monitor its objectives, strategies and overall business plan of

the organization. The Company shall be continuously involved in the research and development

of new products while improving quality of existing products using highest level of quality

control measures at every stage of its operations. Creativity and innovation must prevail at all

levels of hierarchy to achieve organizational excellence.

Abidance of Law

It is Company's prime object to comply with all applicable laws and regulations and to cooperate


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With all governmental and regulatory bodies.

Corporate Reporting

The Company maintains effective, transparent and secure financial reporting and internal control

systems so as to ensure reliable performance measurement and compliance with local regulations

and international accounting standards as applicable. The Company strictly adheres to the

principles of good corporate governance and is committed to high standards of corporate

governance. The Company regularly updates and upgrades manufacturing and reporting systems

so as to keep abreast with technological advancements and achieve economies of production.

The Company believes in uprightness and expects it to be a fundamental responsibility of

employees to act in Company's best interest while holding confidential information and neither

to solicit internal information from others nor to disclose Company's figures, data or any material

information to any unauthorized person/body. Inside information about the Company, its

customers, vendors, employees shall not be used for their own gain or for that of others directly

or indirectly.

Responsibilities

Shareholders

The Company believes in maximizing shareholders value by providing consistent growth and

fair return on their investment.

Customers

The Company considers it imperative to maintain cordial relationship with the customers as

integral to its growth and development of business and is committed to provide high quality

products and services that conform to highest international standards.


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Employees

The Company is an equal opportunity employer at all levels with respect to issues such as color;

race, gender, age; ethnicity and religious beliefs and its promotional policies are free of any

discrimination. The Company ensures that employees work towards achievement of corporate

objectives, individually and collectively as a team and conduct themselves at work and in society

as respectable employees and good citizens. The Company believes in continuous development

and training of its employees. The Company has set high standards of performance and

recognizes employee's contribution towards its growth and reward them based on their

performance. The Company believes development, growth and recognition result in motivated

employees. All employees of the Company are part of Kohinoor family and the families of all

members are also part and parcel of Kohinoor family. The Company believes that the sense of

Belonging to Kohinoor fulfils an essential need of its employees and the organization and as

such will always be nurtured.

Environment

Protecting the environment in which we live is an important element. The Company uses all and

Socialmeans to ensure a clean, safe, and healthy and pollution free environment not only for its

Responsibility

Workers and employees but also for the well being of all people who live in and around any of

the production and manufacturing facilities. The Company will always employ such technology

as may be beneficial in maintaining a healthy and hygienic workingenvironment. It also believes

in community development without political affiliationswith any person or group of persons and


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contributes part of its resources for a better environment with an unprejudiced approach.

(KTML, annual report, 2012).

1.3 History of Pakistan Textile Industry

The textile sector enjoys a pivotal position in the exports of Pakistan. In Asia, Pakistan is the

8thlargest exporter of textile products. The contribution of this industry to the total GDP is 8.5%.

It provides employment to about 15 million people, 30% of the country work force of about

49million. The annual volume of total world textile trade is US$18 trillion which is growing at

2.5 percent. Out of it, Pakistans share is less than one per cent. The development of the

Manufacturing Sector has been given the highest priority since Pakistans founding with major

stress on Agro-Based Industries. For Pakistan which was one of the leading producers of cotton

in the world, the development of a Textile Industry making full use of its abundant resources of

cotton has been a priority area towards industrialization. At present, there are 1,221 ginning

units, 442 spinning units, 124 large spinning units and 425 small units which produce textile

products. The industry consists of large-scale organized sector and a highly fragmented cottage /

small-scale sector. The various sectors that are a part of the textile value chain are: Spinning,

most of the spinning industry operates in an organized manner with in-house weaving, dying and

finishing facilities. Weaving comprises of small and medium sized entities. The processing

sector, comprising dyeing, printing and finishing sub-sectors, only a part of this sector is

operating in an organized state, able to process large quantities while the rest of the units operate

as small and medium sized units. The printing segment dominates the overall processing industry

followed by textile dyeing and fabric bleaching. The garments manufacturing segment generates

the highest employment within the textile value chain. Over 75% of the units comprise small


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sized units. The knitwear industry mostly consists of factories operating as integrated units

(knitting + processing+ making up facilities). The clothing sectors both woven and knits are

mainly clustering in KarachiLahore and Faisalabad where sufficient ladies labor is available.

Pakistan is the worlds 4th largest producer and 3rd largest consumer of cotton. The Textile and

Clothing Industry has been the main driver of the economy for the last 50 years in terms of

foreign currency earnings and jobs creation. The Textile and Clothing Industry will continue to

be an important engine for future growth of the economy; there is no alternative industry or

service sector that has the potential to benefit the economy with foreign currency earnings and

new job creation, especially if synergy is developed amongst different sub sectors and efforts are

made to aggressively grow the Ready made Clothing Sector. Pakistans Textile Industry had

proved its strength in global market during the last four decades. It has proved its strength even

in post quota era by not only sustaining its position but, also showing growth during 2005 to

2007, but declined to $11.1 billion in 2008 due to financial and economic melt down globally.

The Garment Sector & especially the Knit Garment Sector need special focus in future policies.

(http://horizonpak.com/db/Reports/research.pdf,).

Table : Export of Textile and Clothing (Us $ millions)

(http://horizonpak.com/db/Reports/research.pdf,).
http://horizonpak.com/db/Reports/research.pdfhttp://horizonpak.com/db/Reports/research.pdfhttp://horizonpak.com/db/Reports/research.pdfhttp://horizonpak.com/db/Reports/research.pdf


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The word textile, originated from Latin texere, which means "to weave", "to braid" or "to

construct". Textiles process involves spinning of cotton and raw wool fiber on a spinning wheel

to produce long strands yarn. Yarn is further put through the steps of weaving, knitting,

crocheting, knotting, or pressing fibres together to get the end product cloth. As shown in the

figure, Spinning is the first process in the cotton value chain that adds value to cotton by

converting it into a new product i.e. from ginned cotton into cotton yarn. This yarn is further

processed through weaving and knitting to produce fabric. The process of weaving collects the

two distinct sets of yarnwarp and weft in a way that warp threads run lengthways on the piece

of cloth, and the weft threads are inserted over-and-under the warp threads to make a fabric.

Whereas knitting is the process of producing two dimensional fabric through one dimensional

yarn. In contrast to weaving, knitting does not have straight, parallel running yarn, rather it

follows a meandering path, forming symmetric loops symmetrically above and below the mean

path of the yarn. These loops are stretchable giving elasticity to the knitted fabric. Provided the

type of yarn and the knitting pattern, knitted garments can be stretched as much as 500%.

Therefore, knitted fabric is used in stretchable garments, such as socks and hosiery.

(http://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12

.pdf)

Origination of cotton cultivation in subcontinent:

The origination of cotton cultivation and production of textile in the subcontinent5 is traced back

to the 4th and 5th millennium B.C. in Indus valley civilization as the indigenous variety of cotton

- Desi Cotton, has been produced since that period. The residuals of actual textile and textile

material, tools and instruments used in manufacturing textiles, all divulge presence of textile in

the Valley. In the early 20th century, another variety of cotton - American Cotton, was
http://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdf


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introduced in this region by the British ruling at that time. Initially this variety was imported

from the North American continent. However, in 1917, this was cross-breeded with the Desi

cotton. The first test-cultivation of the new genetically modified seed 3F, was made in South

Western Indian regions by a renowned cotton breeder - Dr. Mohammad Afzal. Biologically,

cotton is perennial plant that grows in the forests; nevertheless, with the technological

developments, its cultivation period turned seasonal generating higher productivity.

In 1947, independence of subcontinent from the British rule and its division in two independent countries

Pakistan and India, opened new avenues for the textile sector. Pakistan then, comprised two areas, East

Pakistan (now called Bangladesh) and West Pakistan. The West was the cotton producing area and the

East was for jute production. At the time of partition, East Pakistan received only 90 cotton mills out of

389 mills of erstwhile undivided Bengal. Whereas, West Pakistan was left without any industrial setup

and inherited merely three textile mills, Colony Mills Limited in Multan, Okara Textile at Okara and

Lyallpur Cotton Mill in Faisalabad [formerly Lyallpur].

During 50s, with the more area coming under cultivation, cotton production expended rapidly. In the

meantime, under the Open General Licensing [OGL] scheme, Pakistans business community imported

plants and machinery. This led to the establishment of Star Textile Mills Limited, Gul Ahmed Textile

Mills Limited in Karachi, Kohinoor at Rawalpindi, Nishat and Crescent Textile in Faisalabad. With the

Establishment of the Central Cotton Research Institute in Multan in 1970, cotton breeding process

attained momentum in the country. Pakistan started exporting printed fabrics in the late 70s to Africa and

by mid 80s was sending printed material to Europe.

(http://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12

.pdf).

1.4 Impact of text i le industry on Pakistan economy
http://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdfhttp://www.pacra.com.pk/pages/research/archive/sector_study/textile/Study/Textile_SS_Dec_12.pdf


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Pakistans textile industry is a major contributor to the national economy in terms ofexports and

employment. Pakistan holds the distinction of being the worlds 4thlargest producer of cotton as

well as the 3rd largest consumer in the world.

TEXTILE INDUSTRYS ECONOMIC CONTRIBUTION

Exports 60%

Manufacturing 46%

Employment 38%

Source: Economic Survey of Pakistan

(http://www.rcci.org.pk/wp-content/uploads/2012/12/gtopti.pdf)

Textile sector is considered as the backbone of the economy. On the other hand, it is facing

tough competition in the international market due to increase in cost of production, which is

making it less competitive than the neighboring countries India, Bangladesh & China. According

to Pakistan Textile Journal, Pakistan is among top 10 textile exporters of the world. Textile

export of world over is about $400 billion out of which China tops the list with present export of

$55 billion, followed by Hong Kong $38 billion, Korea $35 billion, Taiwan $16 billion and

Indonesia, India, Bangladesh and Pakistan $11billion each. During FY 2010-2011 textile exports

of Pakistan have continued to grow in the first nine months. According to the Federal Bureau of

Statistics (FBS) and the Trade Development Authority of Pakistan TDAP, textile exports grew

by 30.38% from July 2010 to March 2011. It showed a positive sign in the constant dwindling

textile industry of Pakistan; however this increase can be attributed to the rise in the price of

cotton and other inputs along with a significant increase in terms of quantity as well.
http://www.rcci.org.pk/wp-content/uploads/2012/12/gtopti.pdfhttp://www.rcci.org.pk/wp-content/uploads/2012/12/gtopti.pdf


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Trend of Textile Industry during last 10 years

YEARS GROWTH

2001-02 4.10%

2002-03 5.20%

2003-04 20%

2004-05 24.50%

2005-06 11.23%

2006-07 8.40%

2007-08 4.05%

2008-09 -0.70%

2009-10 -1.78%

2010-2011 1%

Source: Economic Survey of Pakistan

(http://www.rcci.org.pk/wp-content/uploads/2012/12/gtopti.pdf)

Economic Contributions

Any development in the country does not restrict its effects to one or two sectors rather; the

implications of any such development can be felt across multi-sector pathways. Same has been

the case with Textile sector. Here, the discussion is limited to the contributions and effects of

development in Textile industry to the Economic and Social spheres of the country.

(http://www.slideshare.net/uuroosa/analysis-of-textile-industry-of-pakistan)

Increase in National Income

Any development in the industrial sectors greatly contributes to the Gross Domestic Product of

country. Currently, Textile sector alone contributes 9.5% to the GDP. Development of industrial
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sector means more investment, employment and production and hence, higher contribution

towards GDP.

Contribution to taxes

The textile industry's overall contribution of taxes in 2011-12 is expected to reach Rs. 23.5

billion, including payments of withholding taxes and applicability of lower rate of sales tax of

4%-6% on local supplies. Textile exports stood at $12.5 billion from July 2010 to May 2011.

During the current fiscal year, the tax department collected Rs. 10.5 billion as 1.0% withholding

tax. Similarly, textile industry contributed Rs. 2.5 billion at the rate of 0.25% as Export

Development Fund (EDF). Break-up shows that the applicability of lower rate of 4%-6% sales

tax on local supplies would contribute an additional amount of Rs. 11 billion, annually, to the

national exchequer. Moreover, the collection of withholding tax amounted to Rs. 10.5 billion

during ongoing fiscal year.

Economic Stability

Growth in Textile sector has immensely contributed towards economic stability of the country.

This sector alone employs 15 million work force of the country. Moreover, when the finished

goods are domestically available, it helps keep prices down and fluctuations due to international

market influences are less likely to strike populace.

Improvement in Balance of Payments

Textile industry has brought structural changes in the pattern of foreign trade of the country.

Today, the Textile sector account for about US$ 10.2 billion export of the country. On one hand,

this sector helps reduce import bills of textile products and on the other hand, it contributes in


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earning foreign exchange thereby helping towards keeping balance of payment in control.

Following table presents a comparison of years 2008-09 and 2009-10 with respect to exports of

different textile products.

Agricultural Development

Development in Textile sector greatly affected the agricultural development in turn. It is evident

from the fact that if number of textile mills increased from 3 to 600 and spindles from about

177,000 to 805 million respectively in 1947 to 2010 then cotton 15bales increased from 1.1

million bales in 1947 to 10 million bales by 2010. Increased demand of cotton contributed

towards better life of farmer by offering greater market for the raw material.

Greater Employment

As already mentioned, this sector employs about 15 million or 38 percent of total workforce of

the country. If the employment rate is added with the upstream and downstream employment,

like in agriculture or export related work opportunities due to this sector then the economic effect

of this sector increased manifold.

Collateral Industrial Development

Development of one industry leads to the development and expansion of other industries. A

number of industries and work opportunities are directly or indirectly related with Textile Sector.

For example, colors and dies, plastics, printing, machinery etc are equally affected by booms or

busts in Textile sector.

Enhanced Government Revenues

Any industrial development is bound to increase government revenues. Though textile sector is

still zero rated for the purposes of sales tax on exports yet the tax on domestic supply and income

tax contribute greatly to government revenues.


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Diversification of Economy

Development in textile sector has helped in diversifying economy by reducing dependence on

more production and export of raw material. It also instilled diversification by stimulating

collateral industrial development.

Pakistans economy relies heavily on its cotton and textile sectors. The cotton-processing and

textile industries make up almost half of the countrys manufacturing base, while cotton is

Pakistans principal industrial crop, supplying critical income to rural households. Altogether,

the cotton-textile sectors account for 11 percent of GDP and 60 percent of export receipts.

According to the economic survey of Pakistan2008-09 the Pakistan textile industry contributes

more than 60% to the country total exports, which amounts to around 5.2billion US dollars.

According to the 2012 Economic Survey of Pakistan, issued by the finance ministry, the textile

industry itself constituted about 4% of the total size of the economy.

(http://www.slideshare.net/uuroosa/analysis-of-textile-industry-of-pakistan)

1.5 Main Issues and Problems of Textile Industry

Textile industry currently faces massive challenges. Despite introduction of five-year Textile

Policy, implementation is yet to be seen. This implies high policy risk for the sector. Moreover,

efforts to achieve preferential access to EU market are materialized, but the legislation has been

challenged by competing EU countries. Rising cotton prices have pushed raw material costs

substantially high, making it difficult for small players in the industry to survive.2 In addition to

that power loom sector is affected mainly by poor technology, scarcity of quality yarn and lack

of institutional financing, hindering its development from unorganized sector to an organized
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one. However, notwithstanding its important role, currently the Textile Industry of Pakistan is

facing multiple problems that are discussed below:

Power and Energy Crisis

Power and energy is an essential factor for the production process, for further sustentation of

textile sector, energy sector should be improved. It is very difficult to continue production

process without energy. As for as Pakistani textile sector is concern it is faced 8 to 10 hours

electric load shading per day and 2 to 4 days Gas load shading per week.

Electricity Crisis

The power supply totally detached in Punjab and other places of the industrial areas of Pakistan.

Due to that the production process has been stopped on a large scale industrial unit that outside

the industrial estates in particular province as power shortfall gap crossed 5000 Mega Watts. The

industrialists of Punjab were going on strike and shutting down there production in agitation, the

textile worker came on the roads to protest against electricity load shading in all key textile hubs

across the Punjab. Mr. Shahzad Ali Khan Chairman All Pakistan Textile Mills Association

Punjab and central chairman Mr. Ahsan Bashir educated that the textile industry of Punjab

became in heavy pressure due to energy crisis and industry is directed towards forced closure,

they told that the load shedding of electricity has amplified to 8 hours per day. The electricity

distribution to textile industry has arrived at an alarming level and it is disturbing strongly to the

industrial potential of earning which is about $ one billion each month and also providing

vacancies to millions of workers in Punjab.

According to chairman All Pakistan Textile Mills Association Punjab Shahzad Ali Khan

addressed that total demand of electric power in Pakistan is less than 11000Maga Watts, it is not

much difficult to meet the target of the demand, and the target can be met by thermal generation


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but still textile industry is faced long duration load shedding, started from May 2012 and it is

increasing on daily basis. Today the circumstances became worst and it became difficult to

continue the production process for textile industries of Pakistan.

(http://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20I

ndustry%20Facing%20New%20Challenges.pdf)

Gas Shortage

There is also gas shortening to the textile industry. The supply of Gas for confined generations

already cut down to 6 hours a day in a week for the domestic level customer. In the beginning the

textile industry has been exempted from gas load shading but unfortunately recently that facility

is not much available, in winter the demand of gas increases from domestic users of gas due to

that it causes the shortage of gas to the textile units.

If all CNG stations of the country diverted to LPG and the gas is converted to the large scale

industries like textile industry of Pakistan and the Fertilizer industry, an industrial forum to prove

the importance of gas supply to industries for the growth of country has put forward a proposal

but due to the social and political situations it couldnt materialized. However government of

Pakistan should take corrective and preventive actions to solve the energy crisis faced by the

textile industry of Pakistan.

Increasing Raw Material Prices

Increasing yarn and raw material prices is also a gigantic challenge for the textile industry of

Pakistan. The main cause of increasing raw material prices is that the grower of cotton or farmers

of raw material, like cotton are unable to get of their material and middle man enjoys benefits

and they are not given the reasonable prices for the raw material may times in Sindh and Punjab
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farmers burned there cotton to record a strike and the middle man is enjoying the benefits due to

that the industry is bearing the costly raw material thats why they started to grow the substitute

of cotton like sugarcane etc. In this cause the government and the concerning institutions of

government should study the case to solve the problems like this so that the Pakistani textile

industry could compete in the global market as a major player because the cost of product is

dependable on the prices of raw material.

Law & Order Situations in the Country

Since 2007, approximately 2118 people of the state have killed in sectarian violence, and 4025

have been injured. Government has consistently failed to protect the lives as well as property of

people of Pakistan.

In Karachi on overage at least six people were killed per day according to a local newspaper

during the firing and cause target killing. Street crimes, snatching from people, kidnapping for

ransoms all these issues disturb the business environment especially to compete in the global

market with Pakistani competitors. The government should take enormous actions to protect the

state and economy of Pakistan. Many industrialists closed their units and moved to neighborhood

countries to save there selves from ransoms and many other such kind of issues.

Lack of R&D Institutions

There is a very tough competition in global markets. The market needs high quality product on

reasonable price. To improve the quality of Pakistani textile products the industry should

consider on the quality of raw material by the help of research and development institution. Any

forum (like APTMA or any other concerning institution) should do work with the help of R&D

Institutions to improve the quality of Pakistani cotton by arguing or by providing ideas to the


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cultivators of cotton to improve the fiber quality. Once the quality improved the product can

easily compete in international markets.

Lack of Modern Equipment and Machinery

It is also necessary that Pakistani textile industry should be equipped with the modernized

machinery to develop quality product and for the innovation of existing products to bust the sale

in existing markets and to find new markets all over the globe.

Increasing Cost of Production

Production cost of textile industry has increased due to rising interest rates and rising inflation as

well as declining value of Pakistani currency. It became a gigantic challenge for the textile

industry of Pakistan to compete and survive in the international markets.

Lack of New Investments

The textile industry of Pakistan is faced enormous challenges of stumpy production caused by its

superseded textile equipment and machines. To take over this issue the industry needs new

investments. There is not any new heavy investment in this sector for a long time. Due to current

circumstances of Pakistan nobody is interested to invest in Pakistan. Reasoning to that it seems

difficult for Pakistani textile to compete in the international markets.

(http://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20I

ndustry%20Facing%20New%20Challenges.pdf)

1.6 Project Objectives

Application of strategic management in organizations

The process of strategies formulations in organizations
http://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20Industry%20Facing%20New%20Challenges.pdfhttp://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20Industry%20Facing%20New%20Challenges.pdfhttp://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20Industry%20Facing%20New%20Challenges.pdfhttp://www.kasbit.edu.pk/KBJVol_5/5%20Walayat%20Shah%20%20Pakistan%20Textile%20Industry%20Facing%20New%20Challenges.pdf


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The process of strategies implementations in organizations

The evaluation of strategies in organizations

1.7 Significance

Researchers Acedemations Managers Government

1.8 Project outline:

In this project we apply strategic management on organizations for to better understanding of

management. This project is not helpful for only students, by these managers and researchers

also get benefit for these types of organizations. We are dividing project into some chapters; in

each chapter we explained different topics of this industry with relation strategic management.

In chapter one explained the basic introduction of our project, project objectives, background of

our industry and its main issues and problems, the impact of this industry in the economy of

Pakistan. At the end of this we are giving some suggestions for researchers, managers, teachers,

policy makers and government. In chapter two the literature review and methodology of research

is explained and use the analysis techniques. In chapter three explained research type, research

procedure, data collection method, data analysis techniques.

Chapter four of project explained internal & external audit, the selection, implementation and

evaluation of strategic management with relation of strategic management to this industry.


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Chapter five of project is the end of project in which we give the conclusion and

recommendations for researchers, managers, teachers, policy makers and government.

1.9 Chapter Summary:

In this chapter we explained the introduction of our project and objectives of this project. The

main objective is this we want to implement our theoretical study with this textile industry. The

textile industry is play very important role in the history of Pakistan economy. With the

completing of project we were seeing the some important points of this industry.

sm project 2

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