Mazhar Khan

8/8/2019 Mazhar Khan

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COMSATS Institute of Information Technology

COMSATS Road Sahiwal

Organization

Ahmad Fibers Pvt Ltd Multan

Internship Report

Supervised By Fareeha Nisar (Lecturer)

Department of the Management Science

Student Name: M Mazhar Khan Joiya

Registration No: CIIT FA/09 MBA-009/SWL

Semester: 2nd Semester

Date of Submission: August 30, 2010

1



Dedication

I DEDICATE THIS PROJECT TO OUR HOLY PROPHET HAZRAT MUHAMMAD

(PEACE BE UPON HIM).

I ALSO DEDICATE THIS PROJECT TO OUR PARENTS AND TEACHERS

BY VIRTUE OF WHO’S PRAYERS,

I HAVE BEEN ABLE TO REACH AT THIS POSITION

AND

WHOSE HANDS ARE ALWAYS

RAISED FOR PRAY, FOR OUR WELL BEING,

EVEN AT THIS MOMENT OF TIME.

THEN TO OUR RESPECTABLE TEACHERS

AND

TO THOSE WHO LOVE US

AND

TO WHOM WE LOVE.

2



Acknowledgement

I am pleased to present this report on the successful completion of our internship

at AHMAD FIBERS PVT LTD MULTAN .I am thankful to Almighty Allah that

enables me to present this report which is the result of my hard work, struggle,

determination & delegation (to present it up to the best of its requirements). I

wish to acknowledge a lot of people for their valuable contribution to this report.

I am glad to acknowledge the help of Mr. Ahmad Nadeem khan and Mr. Bukhtiar

Ahmad the CEO and M.D of Ahmad fibers. I also acknowledge the support of Mr.

Arshad (Production department), Mr. Sharjeel at accounts department, and Mr.

Ahmad in marketing and sales department.

I would like to acknowledge the moral support and best wishes to my family

members, my best friends and other teachers. At the end, I feel great depth of

obligation to my loving parents whose prayers have enabled me to reach this

3



Executive Summary

In six week internship in Ahmad fibers, I observed the activities in production,

marketing and sales departments. First of all the purchase department start workby purchasing the waste cotton then the production department comes into

action. The waste cotton is 1st ginned and then these ginned these cotton bales

reached the spinning department, these bales

are opened and cotton is torn in to small pieces. This cotton is finally

prepared as thread cones of different quality.

The different departments play an important role in the progress of

conversion such as blow room, carding section, simplex section, and

ring section and auto cone section

Finally these cones are packed into the bags and shifted into the stock room.

Then the accounts manager calculate all the costs and give the cost per bag on

which the bag must be sold otherwise the organization will face loss.

Finally, the marketing and sales manager sends samples of yarn to the parties

and brokers and deal with customers according to their orders and final the

deals. And after the payment the shipment takes place. In this way the

organization has its direct and indirect customers.

4



Table of Contents

Acknowledgement ............................................................................................................... 3

Executive Summary ............................................................................................................. 4

Finally, the marketing and sales manager sends samples of yarn to the parties and brokers

and deal with customers according to their orders and final the deals. And after the payment the shipment takes place. In this way the organization has its direct and indirect

customers. ........................................................................................................................... 4

Table of Contents .................................................................................................................5Chapter No 1 ........................................................................................................................ 6

BACKGROUND OF THE HOST ORGANIZATION ........................................................6

In 1990 Mr. Ahmad Nadeem khan had started this project from ginning unit .In which the

seeds are separated from the cotton. The separated cotton is classified according to itsquality and standards. Finally it is tied up in to bales to bring them for next phase. The

machines that separate seeds can be used to prepare oil, seeds etc..................................... 7

They remained in this business for more then a decade and then they have equipped their unit with new modern technology machines for the production of best quality of yarn.e.g

blow room, carding section, simplex section, and

ring section and auto cone section in 2002.......................................................................... 7And started spinning as well. They are serving till now in this field and the yarn produced

by them is exporting to international markets......................................................................7

1.1 Mission Statement ......................................................................................................71.2 Vision .........................................................................................................................8

1.3 Organizational Values .............................................................................................8

Chapter No 2 ........................................................................................................................ 9BUSINESS OPERATION ...................................................................................................9

2.1 Organization Structure (Organization Chart) .............................................................9

Chief Executive Officer ................................................................................................... 9

Managing Director ........................................................................................................... 9Manger Operations ...........................................................................................................9

Purchase Manager ............................................................................................................ 9

Production Manager .........................................................................................................9Marketing & Sales manger .............................................................................................. 9

Accounts Manager .......................................................................................................... 9

2.2 SWOT Analysis ....................................................................................................... 102.2.1 STRENGTHS ..................................................................................................10

2.2.2 WEAKNESSES ................................................................................................11

2.2.3 OPPORTUNITIES ...................................................................................................12

2.2.4 THREATS .........................................................................................................132.3 Marketing Strategy ...................................................................................................14

2.4 Marketing Mix ......................................................................................................... 14

2.4.1 Product Mix ......................................................................................................14

5



.................................................................................................................................... 17

.............................................................................................................................. 17

2.4.2 Pricing ..............................................................................................................18Physical Distribution .................................................................................................18

2.4.3 Places ................................................................................................................18

2.4.4 Promotional Activities ...................................................................................... 192.5 Competitive Strategies of AF ...............................................................................19

2.6 Business Process Analysis ............................................................................ 20

Chapter N0 3 ......................................................................................................................23Learning as a student intern ............................................................................................... 23

3.1 Duties .......................................................................................................................23

3.2 Accomplishments .....................................................................................................24

3.3 New Knowledge Acquired .......................................................................................253.4 How Experience Impacts your Career .....................................................................26

References ......................................................................................................................26

Chapter No 1

BACKGROUND OF THE HOST ORGANIZATION

6



1In 1990 Mr. Ahmad Nadeem khan had started this project from ginning unit .In

which the seeds are separated from the cotton. The separated cotton is

classified according to its quality and standards. Finally it is tied up in to

bales to bring them for next phase. The machines that separate seeds can

be used to prepare oil, seeds etc.

They remained in this business for more then a decade and then they have

equipped their unit with new modern technology machines for the production

of best quality of yarn.e.g blow room, carding section, simplex section, and

ring section and auto cone section in 2002.

And started spinning as well. They are serving till now in this field and the yarn

produced by them is exporting to international markets.

1.1 Mission Statement

1 Ahmed Nadeem y.2010 personal conversation {C,E,O} 6th july

7



“ According to customer demands, produce superior quality yarn in order to face

the competition in the international market. But at the same time taking care of

their employees, suppliers, shareholders and society as well”

1.2 Vision

“To be the Best in the field of yarn”.

1.3 Organizational Values

• Trust

• Integrity

• Respect

• Best quality

8



Chapter No 2

BUSINESS OPERATION

2.1 Organization Structure (Organization Chart)

Chief Executive Officer

Managing Director

Manger Operations

Purchase Manager

Production Manager

Marketing & Sales manger

Accounts Manager

9



2 2.2 SWOT Analysis

Managers of AF always review the mission and the goals then they do the

internal and external environment analysis to identify the elements that

influences the organization performance. SWOT analysis is the method that

helps managers identify the organizational strengths, weaknesses, opportunities

and threats.

2.2.1 STRENGTHS

Cheap labor

Cheap labor is available to AF which is reducing the per unit cost. Because it

is located in rural area where people are uneducated and they have no other

employment source.

Cotton rates

Waste cotton is also available at cheaper rates because a lot of competition

among the suppliers as you can get it from many textile mills as their by

product.

Cost of production

It has its own Ginning and spinning unit also. This is reducing the cost of

production as compaered to other competitors.

Financial resources

AF has a good financial resource. So they can invest in other textile related

products As well.

Relation with customers

AF has food relations with local buyers due to which their sales are and

they are progressing.

Know how

2 Ahmed Nadeem y.2010 personal conversation {C,E,O} 13th july

10



Good know how about the textile business. This is improving the progress

of company.

2.2.2 WEAKNESSES

Lack of HRD

Lack of HR resources development due to which they have to face

problems when they have to hire new labor.

Promotional activities

Lack of promotional activities.AF should more efforts in promotion by

opening regional offices in different cities of country and through other

promotional tools as well.

Time management

Delivery time is more due to this the shipments are delayed.

Decentralization

There is more decentralization in AF due to which the organization often

faces problems.

Co Operation gap

Co operation gap among the departments often create reduction in

efficient production.

Not Exporting

AF is not exporting products directly due to which they have less profit.

Non-professionalism

Non-professional attitude. This is decreasing efficiency.

11



2.2.3 OPPORTUNITIES

Opportunity to export

AF has opportunity to export to the U.S.A and the Europe markets.

There is more scope of exporting to these markets.

New Markets

AF has opportunity to explore new international and growth oriented

markets for the exports of yarn.

Better marketing techniques

AF can better the marketing techniques by having good marketers who

can provide AF with new and better marketing techniques due ton which

its customers increased.

Latest technology

The company should import the latest technology to decrease the

production per cost unit.Improve the technical skills

The company should make efforts to improve the technical skills of

the labor and employees which will improve the overall efficiency

and productivity of the organization through different training

programs.

12



2.2.4 THREATS

Political instability

Political instability is also a major threat in Pakistan because in 63 years it

mostly ruled by army generals.

Government Policies

Govt. strict policies about the textile sector in the form of taxes..Less cotton production

The unreliable agriculture sector because of energy crisis and due farmers’

poor economic condition.

Competitors

AF has a threat from the domestic and the international competitors. China,

Thailand and Indonesia are the emerging giants in textile. Due to which the

AF will face tough competition in domestic and international markets.

Energy crisis

In Pakistan there is huge energy crisis due to which the industries are not

working efficiently and their production is high as compared to their

competitors. Due to which the customers prefers the competitors and they

face loss.

13



2.3 Marketing Strategy

Marketing department cannot be ignored by any organization because it is the

heart and soul of any organization. AF also gives the pivotal importance to this

department. The marketing manager performs the marketing activities and also

visits the markets to search their new customers.

Marketing Manager perform the Following Activities

• Looks overall problems of the departments and problems faced y the

customers

• Devises all the marketing related policies

• Delights the customers by solving their problems

• Co-ordinate with the production department

• Checks and observes all the activities of textile sector especially focus on

the activities of competitors

The production department makes it possible that the order placed by the

customer should e completed within specified time.

2.4 Marketing Mix

2.4.1 Product Mix

Products of AF are

• Cotton Bales

• Cotton Yarn

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15



16

http://www.globaltextiles.com/tradeleads/detail/002/510189/Buy-Cotton-Yarn.html



17

http://www.tradekey.com/selloffer_view/id/4289501.htm

http://www.tradekey.com/product_view/id/1425366.htm



2.4.2 Pricing

The pricing strategy of AF is composed of two types of variables;

1. Fixed Cost

2. Variable Cost

AF is adopted different kind of strategies for pricing its products. When the price

is setting, these strategies are different when company exports indirectly.

If the company exports indirectly, then the price is settled as follows

Fixed Cost + Variable Cost + Middleman Commission + % age of profit

But usually AF sets its prices through the negotiations with its customers.

Normally AF charges very high prices due to its commitment of high quality.

Physical Distribution

AF sells its products through two different marketing channels.

• Direct Marketing Channels

AF directly contacts with its customers through telephone and personal contacts

and sells its products directly to final buyer.

• Indirect Marketing Channels

In the Indirect Marketing Channels, the distribution is made through

intermediaries. In some cases, AF sells its products through the brokers.

2.4.3 Places

Places where the products of AF are available are

• Multan

• Faisalabad

• Lahore

18



• Abbot Abad

2.4.4 Promotional Activities

Promotion is one of the four major elements of marketing mix. Major exports of

AF are made through Tele phone and brochure services. Many contracts are

settled through personal sitting by public relations.

2.5 Competitive Strategies of AF

Experienced Professional Management

The Ahmad’s team comprises a balanced lend of experienced professionals

including MBA’s, Textile Engineers and Industrial Engineers. Continuous training

and development keeps them abreast with the modern technical and

management tools.

Social and Environmental Responsibilities

AF believes in fulfilling its responsibility towards the society and the environment.

An effluent treatment plan is in the phase of completion.

Quality Control System

AF establishes a documented plan setting out the specific quality practice,

resources required and the sequence of activities relevant to particular product.

There are quality checks at every stage of manufacturing starting from raw

Cotton Bales to Yarn,. During all these stages, the inline inspectors check the

fiber and the work at every stage.

Corrective and Preventive Action

AF has a very strong corrective and preventive action plan. AF has centralized

the corrective action and controls the non-conformity arising in the system. If

necessary, the relative person immediately takes the corrective action. For

preventive action, the department head keeps the record.

19



2.6 Business Process Analysis

Ahmad Fibers Pvt Limited was established in 1990 by Mr. Ahmad Nadeem,

which is located at, Samoor Ana, near Farah mukhtiar school, Multan.Which

is producing best quality yarn. The preference is given on quality not on

quantity, that’s why the sales of the company are increasing every year. The

company has shown distinguished achievements during many previous

years. Different departments of AF are equipped with modern technology.

20



Diagram:

Hierarchy in Marketing and Sales Department

Functions of Marketing and Sales Department

The Marketing and Sales Department comes into action in two conditions,

1. Product at stock

2. Order from Customer Product at Stock

When the production is complete from the production department and the

product is available at the stock room. Then the marketing and sales

21

Marketing andSalesDepartment

Sample to

customer

Order fromcustomers

Request to

Production

department

Request to

Purchasedepartment

Account

departmentFinance

Production

department

starts work



department comes into action and start marketed their product and sells it

through direct and indirect distribution channels.

• Direct Marketing Channels

AF directly contacts with its customers through telephone and personal

contacts and sells its products directly to final buyer. In this process they

send samples to the customers of their product and get order of their

product or they have sittings with their customers.

• Indirect Marketing Channels

In the Indirect Marketing Channels, the distribution is made through

intermediaries. In some cases, AF sells its products through the brokers.

They kept their product samples at different brokers and they seek

customers and commission on providing customers. In this way their sales

volume also increases.

Order from Customers

When marketing and sales department has received an order from

customer and they do not have product in the stockroom. They collect half

advance payment from the customer and deposit it in the accounts

department. After that sends request of order to the production

department and tells them about the quantity of order which is

required.Aftr receiving request the production department tells the

purchase department about the quantity of waste cotton which is to be

required to fulfill the ordrer.Then the cotton selector from the purchase

department select the best sample of waste cotton to buy and request the

account department to do the payment .When it reaches at organization

start working on it and after completing the production informs the

marketing and sales department that the order is ready and deliver the

order to the final customer after receiving the half payment which left.

Recommendations

As the marketing and sales department of AF working well but they can

get more success if they adopt few things which are,

22



• Use E-Commerce and get orders through mails

• They should have to open regional offices in different cities of country

• Do not rely more on brokers

•

They should have to export their product themselves• They should have to spend more budget on promotion

Chapter N0 3

Learning as a student intern

3.1 Duties

During my internship I have been assigned by different duties which are

given below,

Contact to customers in different cities on telephone

Send sample to different customers through cargo service

Meet with different parties and present them sample of our product

Receive order of customers

Note down the order of customers and forward it to the production

department

Checking of stock room that how much quantity of product is left for

sale

Calculate how much sales have been in this year so far?

Meeting with some Brokers

Collect the payment when delivery of order is made

Loaded the truck for delivery of order in my supervision

Present the report after shipment to the sales manager

Calculate the production cost per unit

23



3.2 Accomplishments

The duties I have been assigned I have completed them very well.

Such as the manager says me to contact customers and provided me with their

telephone numbers and i start my work by having phone calls to different parties

that either they have any demand of our product or not and then inform the

manager about the parties point of view.

I ask the manager that how they set the final price of their product that at that

price the organization has meet all the expenses and they have no loss. Then he

told me that after taking the average of all expenses (Raw material, electricity

bills, wages etc) we forecast the production cost and then set price. And after

four weeks he asks me to calculate the production cost per bag of yarn.

Mr. Ahmad says me to calculate the sales of this year and check that how much

stock is left back in the store he provided me the record of previous months. I

calculate the total sales and inform him about the total stock left.

The sales manager says me to note the orders of different parties which they

have placed and ready their orders for delivery. I have noted the orders and

make the delivery sure and then inform the manager about all this.

The sales manager says me to contact and send sample of their fiber to some

brokers and factories in different cities like Faisalabad, Lahore and Abbot Abad.

I send those samples and they have said me that we will InshaAllah place order

in few days.

The sales manager says me to note the address of different parties who want to

purchase our product but first they want to check the sample of our product.

That’s why send them samples through cargo service. Take the sample of yarn

and send the parties through cargo service and inform the manager about it.The sales manager sends me to meet some parties in Multan to brief them about

their product and their offer. After meeting those parties, I come back at 3:00 Pm

and tell him about the party’s point of view.

The sales manager has deal with a party and they place an order of our product,

and after their orders delivery he sends me to cash a cheque as their payment.

24



After collection of cash I have reported the manager that I have received the

payment.

3.3 New Knowledge Acquired

During my internship, I have come to know that how different the practical life is?

That when you enter into the practical life, you have to struggle hard and fulfill the

task to survive in such a competent environment. You have to be tactical and

efficient while interacting with customers and senior staff as well. You have to be

sharp, honest and dynamic personality. So that you can handle various situations

with different tactics.

First I met Mr. Ahmad marketing and sales manager of AF who introduces some

new products in AF. So I learned about the innovation of products. I discussed

about the marketing practices going on in the local market. I learned how to

target your customer after knowing needs with product solution of the customer

need.

During my internship I learnt about the value that customer is all in all. Thefulfillment of the demand of customer is our basic motive. I also learned the hiring

process of labor and employees there in the company.

I also learned that how the budgeting, forecasting and financial strategies are

made. With this internship experience I feel that I have ability to solve company

related issues.

I have also learned that how the material purchased at low cost can affect theproduction cost and profit margin of company.

25



3.4 How Experience Impacts your Career

I think that this internship program will be very good for my future. This internship

program will help me in my future professional life. If I want to do the job in anytextile industry then this internship will help me at that time. If I want to start my

own business then this internship program will help me.

The things that I learned in the sales offices will help me in making the marketing

strategies of the company in which I will do the job. The same will help me in

introducing the products of my own business. The experience of bargaining

power of the purchase of the material will help me in my job.

The experience in the production department will help me in planning and control

of production. I apply all the policies of HRM that how the work extracts from

labor and the employees that how to make co ordination and co operation among

departments and employees effective.

References

1.Ahmed Nadeem y.2010 personal conversation {C,E,O} 6th july

2.Ahmed Nadeem y.2010 personal conversation {C,E,O} 6th july

http://www.globaltextiles.com/buy_offer/cate-002001-3/Cotton-Yarn.html3

http://www.alibaba.com/product-free/218515935/20_1_Cotton_Yarn/showimage.html?

pn=1&pt=10&t=2&newId=218515935&cids=null#breadcrumbs

http://www.tradekey.com/ks-cotton-bales/

3

http://www.globaltextiles.com/buy_offer/cate-002001-3/Cotton-Yarn.html

http://www.alibaba.com/product-free/218515935/20_1_Cotton_Yarn/showimage.html?pn=1&pt=10&t=2&newId=218515935&cids=null#breadcrumbs


http://www.globaltextiles.com/buy_offer/cate-002001-3/Cotton-Yarn.html



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Mazhar Khan