Lecture # 8 PPC and Procurement

…PPC…  PPC stands for –Production Planning and control –Production planning and co-ordination

…PPC…  “Production Planning and Control” is usually considered the process by which the raw material, partly finished and finished goods are planned, regulated and monitored.

Planning …  There are three types – Scheduling – Aggregate planning – Long term planning

Responsibilities of department  Allocating work in a most profitable way  Adjusting the production schedules to meet the changing circumstances  Provide information about the progress of orders

Different Tasks…  Drafting guidelines  Evaluate production capacity  Make long term production plans  Schedule production  Originate orders for raw materials  Load orders as required  Monitor progress  Provide an information exchange

…Be Aware…  Mostly, in textile and clothing industry, PPC department is undervalued and considered as a clerical activity

…Planning…  It may be divided into two parts. – Production Planning – Material Planning

Scope in Textile…  Spinning  Weaving  Knitting  Dyeing and Finishing

Scope in Clothing…  The most complex process –Pattern making –Spreading and cutting –Bundling and numbering –Many operations of sewing –Under/ top pressing –Final inspection and Packing  Operator’s skill has a great effect on productivity

Scope in Clothing…  Quality service and work study are also involved in flow process  The range of complexity and rate of style change differs widely

Production Planning…  Functions of productions planning are – Long term planning  The long term view: Where we are going. – Scheduling  Work will be allocated to production according to the agreed plan – Controlling / Monitoring  Production rarely goes according to the schedule  Make changes accordingly

Scheduling and controlling…  Key factors are –Throughput time –Work In Process –Critical paths –Bottleneck operations –Plant utilization –Effect of changes –Waste percentage

Material Planning…  It comes under the department of “Purchasing” or Procurement

…MRP…  MRP stands for “Material Requirement Planning”  MRP also stands for “Manufacturing Resource Planning”

Material Requirement Planning  This is an information system which is based on the requirements of material in terms of type, Volume and the dates etc  There are two approaches –Regeneration –Net change

Purchase Department…  The basic function of purchase department is to provide the right material, at right quality, at right time and price.  As material’s cost have a significant weight in the price of a clothing product, so it is very much important.

Functions…  Look for the suppliers  Price, quality and in time delivery  Speculative buying  Storekeeping  Stock management  Purchase order

Suppliers  The purchasing department must ensure that the supplier is stable and reliable.  Particularly, in case when you are dealing with a supplier who does not have a known track record.

Price…  Quality and quantity of material is dictated by the operations department.  The purchase must be at the most advantageous terms for the company. (e,g, freight cost, insurance, discounts and credits etc)

In time Delivery…  The purchase department must ensure the in time delivery of the materials.  Because the late or no delivery may cause the stoppage of your production lines.

Verification…  On arrival of material to the mill’s premises, purchasing department should check the product.  The storekeeper checks the quantities  The quality people check the material against the different quality parameters.

Speculative buying…  When market conditions are favorable, purchasing department may suggest for buying of commonly used materials  This is mostly applied in case of imports –Price will rise –Things would be difficult to obtain

Store Keeping…  Receiving Goods  Checking of goods  Storage of goods  Issuance of material

Purchase Order (PO)  Purchase order is a contractual document  This document should be clear enough –Delivery as soon as possible –Price to be agreed

Purchasing Procedure