The hidden reality: saving total salary of a garment factory from ‘Common Wastages & NPTs’

This article is based on real cases inside garment industries. A series of articles will come following this article to show our entrepreneurs “how to chase troubles to make the garment business sustainable”.

Abstract:

Day by day, it is getting pretty tough for the garments manufacturers to continue the business with the growing stress from different corner. Issues like staff & worker’s salary & wages hike, increased raw material price, decreased buyers price, competitive market, political unrest, safety & compliance challenges, local & international annoyances all together making the garments business more hectic and challenging than earlier. So, this is one of the right times to think in multi directional way to find out the way of continuing the business. Wastages and Non Productive Times (NPTs) are among the hidden assets from where factory can dig out additional savings of a huge amount of money and can arrange its total salary and few other expenses as well. The only thing we need to do, is to spare little more time behind well managing of these wastages & non productive times (NPTs). Such an approach will help increasing business, environment & social sustainability of the Bangladesh.

1. Introduction:

Wastage is a great loss for the company & Non Productive Time (NPT) which in other words loss of production, affects the profitability of a company. There are many reasons for which production lines of a garment factory suffers for poor productivity. By reducing the reasons of non-productive time (NPT), production of a garments factory can be increased a lot. And by wastage management, company directly can save a big money. Thereby, company achieves a huge amount of financial benefits by well managing both the wastage and NPT.

2. Experiment & Findings:

 As per a study done through past several years, following analysis and from practical job experience in some factories of different categories, the result surprisingly demonstrate that factory can even provide their salary only by saving money from fabric wastage & NPT’s. For instance, one of the case studies of a semi medium factory “CK” having 10 lines shows the figures different types of loses from wastage & NPT as given in below Table-1 & Table-2 for easy understanding.  (Figures will be different for medium to large factory). It is to be believed that this will open up a new window for better survival of garment manufacturing companies.

Figure 1: Different types of wastages & NPTs and their loss % on total loss.

 Table 1: Approximate Calculation of Loss for all wastages & NPT s
(Case Study of a 10 Line knit factory “CK’, Figures will be different for medium to large factory):

 Table 2: Summary of Loss for all wastage & NPT

From above Statistics of table 1 & table 2, we can easily understand that a 10 line factory can arrange its total salary by saving money from wastages & NPT’s. Even an amount still remains in hand as saving. Proportionately, a medium to big factory can save even more money. To achieve this, we need to spare a little more time only, behind well managing of these NPTs and wastage.

3. Short description of different types of Wastages & NPTs

Figure 2: NPT’s in different stage of Production (Input-processing-output)

3.1 FD= Feeding Delay:

Factory’s production line greatly suffers due to feeding delay or not timely receipt of input material. Feeding delay badly affect the productivity. It hampers the production, shipment and generates excess OT (Over Time) & unplanned & style changing delays which are great loss for the company.

Incident 01:  knit Factory ‘BA’ started 02 lines for a particular style after receiving initial delivery of total fabric. After 2/3 days, fabric support was not sufficient for 02 production lines.  So lines were facing input problem in the middle of the production. Due to insufficient fabric support for 02 lines, 01 line was thereby withdrawn. A New style was arranged for that line. The new unplanned style changing delay took 4-5 Hours. So here we lost production for several hours and faced other associated problems like extra OT, Tiffin, electricity etc. to meet shipment date by running the orders in 01 line instead of 2 lines. Factory “BA” used to face this type of feeding delay very frequently for their lack of monitoring of time & action calendar. And thereby the factory had huge loss of production, increased OT, shipment delay etc. which all lead that factory to incur financial losses.

Table 3: Related loss due to feeding delay are given bellow for easy understanding:

3.2 En & Ex Loss = Entry & Exit loss time in morning, lunch hour & last hour:

Incident 02: In a  Factory name ‘KS’, due to supervision problem, almost every day in the morning average worker takes 10-15 min to get settle down for the production, then before lunch, they stops machines 10- 15 min earlier, goes to the toilet or loiters around and leaves the floor before the lunch bell, after lunch they take again 10-15 min to get settle down to start prod, like wise they waste another 10+10=20 min before and after Tiffin and another 10-15 min they waste by stopping the machines early during final pack up . So in a day the factory is losing production for around 1 hour 20 min as a whole.

3.3 SS=Short Shipment     

Short shipment is another great loss for a factory. By stopping short shipment factory incur its direct profit loss, if factory can do excess shipment than the financial gain will be more than double for the company. Related cost analyses are given bellow for easy understanding (From the case study of factory “KS”):

3.4 Fb.D = Fabric Delay:

For proper feeding, cutting section must need fabrics properly. If they won’t get sufficient fabrics in time, it will lead to feeding delay for the production line which hampers the production.

Incident 01: Factory ‘HN’ has own dyeing section but capacity of dying section is not enough. Due to delay receipt of fabric line faces frequent feeding gap for couple of hours.

Incident 02: Factory ‘HN’ takes fabrics support from other factory. But due to delay receipt of fabric for several hours Line no: 01 fall into feeding crisis. Finally running style is withdrawn and a new style is given in that line. This Unplanned style change delay which took 3-4 hours. Factory ‘HN’ used to face this type of problem regularly causing a big production & financial loss for that factory.

3.5 CD= Cutting Delay:

Fabric delay, Shade variation, shade approval delay etc with few types of others delay can lead cutting delay and its consequence result is feeding delay.

Incident 01: Factory “HN”, cutting section of a unit received 800kg fabrics of a style. Before fabric cutting, QAD performed fabric inspection. Total fabric failed by 4 point system for shade problem. Fabric was returned to dyeing section for re-dyeing. Line of that style fell into 2-3 hours Feeding delay and that hampered the production.

Incident 02:  Factory “HN” Unit 04 got 1728 kg green color fabric for a style. But prior to cutting, Quality department noticed that color was yet not approved. So cutting could not be done and this problem leaded to Unplanned SCD which took 4-5 hours with associated production and financial loss.

3.6 ED= Embroidery Delay/ PD= Print Delay:

Incident 01: Most of the lines of Factory “GA” were doing Polo and Hood jacket which had embroidery work.Embroidery had less capacity than sewing demand for which those lines were not getting feeding properly. This feeding gap was for couple of hours and found almost every day.

Incident 02: Factory “GA” was getting printing support from a sub contact factory. But they did not get printing approval in time which delayed the support. Again everyday due to delay delivery from print factory, production line faces feeding delay for couple of hours very frequently.

3.7 Apvl.D= Approval Delay:

There are various types of Approval delay such as sample approval, Fabric approval, printing approval, Embroidery Approval, Shade approval, Trims and accessories Approval and many others types.

Incident-01: Factory ‘GA’ did not get the care label approval in time but production of that particular style needed to be started to meet the shipment date. Factory was told that they would get the care label after three days for that particular style. So production started without care label which ultimately lead the factory for reworking, excess OT, tiffin etc. which are all loss.

Incident-02: Factory ‘GA’, Cutting section of unit 02 got full quantities of Yellow color fabrics but due to shade approval delay, cutting could not be started.

3.8 T&A= Trims & Accessories not available:

Factory ‘GA’, Unit 05, Line no. 07 of a unit, a running style was suddenly stopped due to thread crisis. Finally it was found out that balance thread did not match with approval shade. For this reason, another color was taken for input. Production hampered for an hour or so.

3.9 MEW=Marker Efficiency Wastage:

As per the study of a factory “CK”, it was seen that average marker efficiency was 82% of that factory. But, by efficient marker management, 1.5% – 2% marker efficiency can be increased which could reduce total fabrics consumption and could save a huge fabrics or cost of the fabrics. A statistics is given below for a 10 line factory “CK”. The fabric saving and financial benefit will be much higher in medium to large factory.

3.10 Excess Cutting:

When cutting section cut more than allowable (3%), it is called extra cutting. Monthly cutting scenario of a factory ‘PG’ is given below.

3.11 EMU = Excess Manpower Use:

Factory ‘PG’, Floor 01, Line no.01 could not get care label in time, that’s why without care label garments was produced. After getting care label, for attaching the labels, line chief used extra OT, extra man power more than required which is a loss.

3.12 WG = Wastage garment percentage:

Incident 01: Factory ‘PG’, floor 01, A Style has 3 types of print each print. Due to lack of supervision of printing section, 220 Pcs printing parts got rejected.

Incident 02: Factory ‘’PG’’ Floor 01, had High rejection percentage from sewing section. Consequences was short shipment which is a direct loss.

3.13 Absenteeism & Turnover:

Incident 01: Factory ‘CK’, Floor 03, workers used to do excess OT, caused fatigue of the worker. So their absent percentage became high.

Incident 02: Factory ’CK’, Floor 03, absenteeism rate of this floor was 9.3% for excess OT related fatigue, lack of motivation of worker, ill behavior etc. That’s why it was difficult to set floor for required productivity.

Incident 03: Factory ’CK’, Unit 05, Turnover rate of a month was 9%. Average man power of this month was 436. Loss of Man days of this month was 1020. This type of turnover rate every month ultimately reduces the total production, caused a big financial loss.

3.14 Defect%:

Defect leads Dreadful quality. More percentage of defects hampers the running production & time as well.

Incident 01: Factory ‘PA’, Unit 03, line 01, had average 10-12 % alter by sewing quality check, and average 14-15% alters from finishing section. Hourly production was 1240. To rectify alter, apprx 18 Man hours were needed for reworking. Every day this type of reworking needs excess OT, tiffin, excess electricity etc. which all caused a loss for the company.

Incident 02: Factory ‘PA’, Unit 01, a style had much measurement discrepancy and finally ship out that style with short shipment causing a loss for the company.

3.15 CS= Color Shading:

Factory ‘KS’, Unit 01, line 04, line chief mismatches the bundle and thereby neck rib did not match with Neck join. After 2-3 hrs, shading problem appeared in output table. Production suffer 1.5 hour and rework needed to rectify shading products. This type of rework always causes financial loss.

3.16 PF. =Power Failure

For power failure, within short time we lose huge man hour. Because during P.F. full production remain fully stopped.

Factory ‘CK’, sewing section were suffers 25 min for power failure due to generator problem, and during that time production was nil. Quantity loss was 450 Pcs only for that time. The more is the power failure, the more the production loss or more the financial loss of the company.

3.17 SCD&FP= Style Changing Delay & First Production:

Incident 01: Factory ‘KS’, Unit 05, Line 02, SCD needed 3 hours more than allowed. Because of delayed arrangement of required machine total man hour loss was 75.

Incident 02: Factory ‘KS’, Unit 01, Line 07, Due to lack of supervision problem of line chief, a style took 2 hours more for 1st output. Total man hour loss was 56.

3.18 Unp. SCD for Fb. & Acc

Factory ‘PG’, Unit 03, Line 01 was not getting feeding properly due to fabrics delay. Cutting section returned 560 kg fabrics due to fabrics shade and fabrics fault. Decision was taken to replace the style by another Style. Total man power was 29 and took 2.3 hours more than required for new lay out caused a production loss.

3.19 MB= Machine Break Down:

Incident 01: Factory ‘PG’, Unit 04, Line 05, due to proper maintenance machine break down was for 25 min.

Incident 02: Factory ‘PG’, Unit 02, Line 08, unskilled operator was used in the sewing lines. For inexperienced handling of the machine by the unskilled operator, a machine break down occurred for 20 min. Both the factor affects productivity.

3.20 Wrong attitude & lack of coordination among staff & management:

It is really surprising to listen that in a factory ‘CK’, just to get a night allowance of 300 taka staffs are intentionally cumulating the goods in day time and compelling the workers to continue for excessive OT or for night work. By this ill practice, those staffs may manage to keep a couple of thousand of taka in their pocket. But to manage that little money they are driving or compelling the whole factory to do excessive OT, night work for whole month which is almost 5,82, 400 taka monthly or 69,88,800 taka yearly (Ref to the Table 2). So, only for this ill attitude and in coordination among the staff, a factory is losing really big money.

4. Tools & Techniques to Reduce Wastages & NPTs:

4.1 Implementation of production planning and controlling software can help reducing wastage and NPT’S-

• An effective aggregated planning considering various practical aspects will be possible.
• A well monitoring of PPC (Production Planning and Control) and different way of following up daily production progress monitoring.
• NPT Report generation & monitoring.
• Effective Follow up of Proper Time & Action calendar and related supply chain management.
• Tools & technique to Maintain proper balance between demands vs. capacity.
• Utilization of man, machine & material properly.
• Maintaining proper feeding ensuring procedure.
• Using Critical Path for smooth preproduction activities.

4.2 Automatic expert marker making software system can help on-

To achieve optimum marker efficiency (At least 1% confident fabric saving on existing system)

4.3 Applying cutting room automation (Auto spreading and automatic cutting)-

• Unbelievable reduction (50%) of manpower in cutting room.
• ‘0%’ cutting mistake and no cutting defects.
• Reduce excess cutting.

4.5 Cutting room management software:

Such software will help to reduce various kinds of delays in cutting room. It will ensure proper cut-plan and lay-plan hence reduction of manpower and reduction of working stress can enhance productivity. Proper planning & control gives potential fabric savings as well.

4.6 Other technique where technology is not important, but important is the WISH to gain a successful business-

• Applying Motivation principle.
• Maintaining of proper corporate culture.
• By using different tools & technique of Industrial Engineering.
• Finally CT scans- A new concept. Diagnosis of a total factory & apply proper therapy for all NPTs & wastages.
• Following up of Cost reduction activities.
• An Effective checklist to follow and Ensure all quality parameter.
• Paying fair wage to all.

5. Conclusions:

The study was done compiling learnings and observations from practical real life cases. These wastages & NPTs are very common cases for most our factories. It should be mentioned that there may be factories which may have better practices in any of the area or in many of the areas. But we must acknowledge the productivity and effectiveness of our average industries are very poor and these are basically the main hindrances cutting the profitability of our industries. So it is clear that still there are many rooms to improve and many ways to develop the garments industry of Bangladesh even though we are facing some biggest challenges right now. It is true that, this industry has become one of the top largest exporters in whole world by confronting lot of challenges from the inception and we might face even more hurdles in our upcoming way. To face all those challenges and to make our pace smooth, we will keep no stone unturned to find out innovative ways and means suited for our garments industry to reach to the top destiny in the world market.

6. References:

•  R. B. Khann, Production & Operation Management
• Sanda Renko, Supply chain management-new perspectives
• Mehmet Savsar, Quality assurance & management
• Adedeji B. Badiru, Hand book of industrial & Systems engineering
• F. Robert Jacobs, Manufacturing Planning And Control for Supply Chain Management
• Isin Akyar, Wide Spectra of Quality Control
• Richard E. Gustavson, Production Systems Engineering: Cost & Performance Optimization
• Case study of factory ’CK’
• Case study of factory ’BS’
• Case study of factory ’PA’
• Case study of factory ’HN’
• Case study of factory ’KS’