INDUSTRIAL OVERVIEW AND COMPANY BACKGROUND
Industrial Overview
Vietnam's garment industry, rooted in a rich history, has undergone rapid growth in recent years This vital sector not only provides clothing for the population but also generates significant employment opportunities Additionally, it plays a crucial role in boosting foreign currency through exports and contributes substantially to the national revenue.
The Textile and Garment industry is a vital sector for Vietnam's economy, consistently ranking as one of the country's top export industries In 2013, Vietnamese garment and textile products were exported to over 180 countries, generating an impressive turnover of USD 17.9 billion, which accounted for 10.5% of the nation's GDP, second only to petroleum exports.
According to VITAS statistics in 2014, the percentage of exporting garment by CMT is still around 85%, FOB is only 13% and only 2% is exported by ODM
CMT (Cut-Make-Trim) is a basic textile export method that offers minimal added value In this arrangement, the buyer supplies all inputs, including trims, transportation, design, and specific requirements, while manufacturers focus solely on cutting, sewing, and finishing the products Companies utilizing the CMT method need to possess production capabilities and a fundamental understanding of design to create product samples Once completed, the finished products are collected and distributed by the buyers.
OEM/FOB (Original Equipment Manufacturing/Free on Board) involves the process of purchasing raw materials and selling finished products In FOB orders, companies are tasked with importing raw materials and managing production This method requires companies to actively source input materials to manufacture their products There are two types of FOB: FOB Level 1, where materials are purchased from suppliers designated by the customer, and FOB Level 2, where the company is responsible for sourcing the materials independently.
- ODM (Original Design Manufacturing) This method is including the designing stage and the production process from purchasing fabric, trims, cutting, sewing,
Design capabilities significantly enhance a vendor's expertise, adding substantial value to the product ODM businesses specialize in creating designs and complete products, which they sell to buyers, typically the owners of prominent global brands This process involves meticulous finishing, packing, and transportation, ensuring that the final product meets high standards of quality and appeal.
Vietnam's garment industry has become a focal point for foreign investment, driven by its robust production capabilities, plentiful labor resources, and low labor costs, all supported by government development initiatives This influx of investment is enhancing production efficiency and increasing product value, as highlighted by statistics from the General Department of Customs.
In 2017, Vietnam's garment industry exports reached $28.84 billion, marking an 11% increase compared to the same period in 2016, which is significantly higher than the 5.2% growth rate of the previous year Foreign investment in the garment sector rose by 10%, primarily from countries such as the US, EU, Japan, and Korea, contributing positively to the nation's trade balance Additionally, the trend of shifting production orders from China to Vietnam has been driven by Vietnam's more competitive labor costs.
The Vietnam Textile and Apparel Association (VITAS) highlights that the key elements of its value chain involve strong collaboration among raw material suppliers, local manufacturers, intermediaries, and international clients.
Figure 1: Value chain of Vietnam’s textile and apparel industry
Company Background
MORE UK LTD is a leading intermediary in the fashion industry with over 15 years of experience, specializing in ethically produced, design-led ladies' wear The company offers a diverse range of high-quality garments, particularly blouses, leveraging trend-driven fabrics and trims With offices in Leeds, London, Vietnam, and China, MORE UK ensures exceptional customer service at competitive prices Established in Ho Chi Minh City in 2014, the representative office employs 15 staff members, along with 5 quality control professionals overseeing subcontract factories The company's primary export markets include the UK, Australia, South Korea, and the USA, with the UK being the largest market The representative office focuses on trade promotion and market research activities.
In the range of this paper, we only analysis the situation in Representative Office in Ho Chi Minh City, Viet Nam
PROBLEM JUSTIFICATION
Problem finding process
The MORE UK Representative Office focuses on conducting market research and promoting trade in Vietnam's textile and garment sector Collaborating closely with its parent company in the UK, the office seeks out factories and suppliers to facilitate garment processing operations in Vietnam, ultimately exporting products under the outsourcing factory's name.
VC has emerged as a leading outsourcing factory, specializing in the production of blouses and trousers for UK orders With years of close collaboration, VC consistently provides competitive CMT pricing while ensuring high-quality products that meet customer satisfaction.
By observing all aspects of the company, the author finds that the appearance of another
Between Q1 2017 and Q2 2018, an analysis of 7 orders revealed a hangover rate of 35% to 55% The author conducted interviews with key staff, including merchandisers, planning employees, and pattern makers, to identify the underlying issues A primary concern highlighted was the rising costs, which encompassed increased CMT prices and transportation expenses for materials to the supplementary factory.
Company’s Symptoms
The discovery of unexpected supplementary factories has resulted in increased expenses, particularly in CMT pricing The failure of the VC factory to meet deadlines has necessitated the search for alternative factories, leading to higher CMT prices and additional costs that have negatively impacted order profitability since early 2017 The tables below provide detailed insights into these issues.
The amount of order in main factory (VC)
The amount of order which transferred to supplementary factory
Table 1: The amount of orders which transferred to supplementary factory
In table 1, it shows the amount of orders which transferred to supplementary factory
Due to the VC factory's inability to meet garment production deadlines, MORE (UK) has had to transfer all raw materials to alternative factories As shown in Table 1, there is a significant percentage of orders shipped to supplementary processors, particularly during the peak seasons of IV/2017 and I/2018 This period sees a high volume of garment exports to the UK and Australia, resulting in full production capacity at VC However, various objective and subjective factors, detailed in the Situation Analysis, have hindered the ability to fulfill many orders at the VC factory Consequently, MORE UK has sought supplementary factories with superior production capabilities and clearer operational plans to manage these orders effectively.
Finding a supplementary factory often leads to increased costs, as the CMT price at the new facility is typically higher than at the VC Additional operating expenses arise from transporting fabric from the VC to the new factory and handling import and export costs Furthermore, the expenses associated with producing pre-production samples (PP samples) also rise, since each factory must create these samples to determine bulk production methods.
In the limit of this article, the author only mention to the average CMT Price for each blouse and trouser with MILLERS customer for instance
CMT Price in VC factory $1.5 $2.2
CMT Price in supplementary factory $1.7 $2.5
Table 2: The CMT Price in VC factory and supplementary factory
The transportation costs for delivering goods by truck to the replacement plant are influenced by the distance between the plants and the quantity of fabrics and materials being transported For bulk orders, utilizing 2-3 trucks for transportation can lead to significantly higher expenses The accounting department has compiled data outlining the average costs associated with these transportation activities, which are detailed in the table below.
The amount of order which transferred to supplementary factory (HUY HUNG, CONG
Table 3: The transferring expense to supplementary factories
In addition, the cost of making PP samples is doubling, depending on the requirements of customers, such as customer MILLERS, PP samples will be 3 pieces, a size 10 and 2 size
14 When VC factory receives orders from MORE UK, after receiving the bulk fabric for the production, the factory will sew 3 PP samples to know how to process the garment and apply for production Depending on the type of blouse or trouser, the cost of these styles will increase with its complexity.
Problem Identification
Following a thorough symptom analysis, it was determined that the rise in CMT prices and management expenses stems from the "unexpected supplementary factories" issue To gain deeper insights and identify potential problems, the author interviewed Ms Kim Dung, a Merchandiser closely working with the VC factory, uncovering new findings In conclusion, various factors contribute to the "unexpected supplementary factory" phenomenon in the context of MORE UK.
The approval process for fabric and trims is notably time-consuming, as highlighted by Ms Dung Delays in customer approvals can hinder MORE UK merchandisers from placing timely orders, ultimately affecting factory delivery schedules Each detail, including main fabrics, buttons, zippers, eyelets, linings, and labels, requires customer approval Once MORE UK receives the purchase order and technical packs, they must identify suitable suppliers based on price and quality, which necessitates the provision of trim samples This process can take several days, as suppliers send samples to MORE UK before they are forwarded to customers for approval.
Delivery times for orders shipped via DHL, FedEx, or UPS from our Australian and UK branches may take several days Additionally, due to the time zone difference, MILLERS customer support only responds on Tuesdays and Thursdays, which can lead to delays in obtaining approvals—sometimes extending to a full week for a single button approval Once approved, bulk orders are then imported to our factory in Vietnam.
Occasionally, MILLERS customers request changes to order details, such as modifying price ticket labels, despite MORE UK having already completed the labeling process for finished garments These alterations can significantly impact MORE UK's production timeline and costs, as they necessitate reordering and producing new price tags from scratch Consequently, this issue can hinder the main factory's capacity to meet production deadlines, often requiring assistance from supplementary factories to fulfill orders on time.
Due to the limited production capacity of the factory, following the execution of the contract with CMT, MORE UK will collaborate with primary suppliers to import fabrics and trims from China or local sources.
VC Factory is set to begin production, having committed to deliver garments to customers by the specified hangover date However, the factory failed to initiate cutting and sewing activities prior to this date, resulting in unprepared fabric and an inability to fulfill orders Despite receiving numerous simultaneous orders, the factory's limited capacity hindered their ability to manage all requests with the same deadline.
MORE UK focuses on providing competitive pricing for its medium and low-cost customers by partnering with factories that offer the lowest CMT prices without compromising quality, notably collaborating with VC factory Since early 2017, the majority of MORE UK's orders, particularly for blouses and trousers, have been processed through contracts with VC factory.
Ms Dung emphasizes that for MILLERS customers, the primary orders consist of blouses and trousers They provide very competitive FOB offers, prompting us to place orders at the VC factory, which also offers low CMT costs This combination of affordable pricing and the ability to meet specific designs and customer requirements is essential in selecting a factory.
Inefficient ordering of fabrics and trims poses significant challenges for merchandisers, as the differing lead times complicate material importation While fabric typically requires 60-70 days for delivery, trims such as buttons, zippers, and linings only take about 10-15 days for production and inspection This discrepancy can lead to delays, as the complete set of materials may take months to arrive at the factory, hindering production timelines Furthermore, quality issues with trims, including defective products from suppliers, can disrupt the synchronization of cutting, making, and sewing processes, ultimately causing further delays Merchandisers must have a thorough understanding of material lead times, yet often struggle to ensure that all components arrive simultaneously, which is crucial for timely production commencement.
- Lacking of person who in charge of controlling sample room: At present,
MORE UK relies solely on technical controls for sample management, leading to a lack of clarity regarding priority samples since specific requirements are not monitored Consequently, the sample room is often unaware of which samples to prioritize Additionally, the quality of these samples is not rigorously checked, resulting in multiple revisions to meet customer standards This excessive reworking prolongs the production process, causing delays that prevent the factory from meeting deadlines effectively.
The lack of clarity in the roles of merchandisers and planning staff has led to inefficiencies within the organization Both departments often overlap in their responsibilities, resulting in duplicated efforts when managing orders with suppliers This confusion is exacerbated by an unclear management system and work assignments, which hinder effective collaboration between the order receiving and planning departments Additionally, the high workload and pressure from numerous customers, coupled with demands from the VC factory, contribute to the overall ineffectiveness of the merchandiser team.
MORE UK has identified that the production capacity at VC will not meet the timeline for garment exports, prompting the Chief Representative to seek alternative factories such as Phu Khang, Huy Hung, and Cong Phat This transition has resulted in increased costs, as the CMT pricing is higher than that of VC, alongside additional expenses related to transporting fabrics and trims, import/export fees, and customs charges Consequently, these factors have raised the management costs for MORE UK's office in Vietnam and negatively impacted the overall profitability of the company.
In average, an order takes a total of 3 – 3.5 months since MORE UK get the purchasing order from the customer to the hangover date Ideally, if there is no factory change,
MORE UK is committed to ensuring timely delivery and high-quality goods for its customers If the production planning is not met by the VC, all fabrics and trims may be transferred to another factory, which can lead to a shorter completion time than usual This shift can compromise product quality and elevate risks for MORE UK, especially if the supplementary factory struggles to maintain the production pace, particularly for complex orders that require extended production time.
The whole picture will be demonstrated as Initial Cause - Effect Map below:
Lacking of merchandiser’s role clarity
Time consuming for approval samples Changing order detail information
Low capacity of factory for production
Insufficient ordering fabric and trims process
Lacking of person who in charge of controlling sample room
Merchandiser and planning staff have a similar job
Materials have not been at the factory at the same time
Figure 2: Initial Cause – Effect Map
MORE UK is experiencing a surge in orders from MILLERS customers, prompting the search for new supplementary factories due to VC's inability to meet demand for various objective and subjective reasons This situation has led to increased CMT and additional expenses, initially manifested as the need for "unexpected supplementary factories." In the following section, the author will conduct a literature review to establish a theoretical framework related to this symptom, ultimately identifying the core problem through data gathered from in-depth interviews with planning staff.
Through in-depth interviews with a planning staff member, a merchandiser, and a pattern maker, the author identified potential issues contributing to the current challenges faced by MORE UK Complementing these insights, the author conducted thorough research to substantiate the perspectives shared by the interviewees.
ALTERNATIVE SOLUTIONS
Cause validation
The core issue facing MORE UK is the unexpected presence of supplementary factories, which has led to ineffective operation management To uncover the underlying causes, interviews were conducted with key personnel, including Ms Dung and Ms Nhu, two merchandisers, along with Ms Thao from Human Resources These individuals possess a deep understanding of the company's working environment and the associated problems, providing valuable insights into the specific causes of the operational challenges faced by MORE UK.
Effective leadership is crucial for guiding employees towards achieving organizational goals, as highlighted by Fiaz et al and Bass Leadership significantly contributes to both organizational success and competitive advantage Moreover, effective operations management stems not only from efficient processes but also from the ability to lead and engage people in pursuit of shared objectives Yukl and Van Fleet emphasize that leadership encompasses the influence on task objectives, strategy implementation, group dynamics, and organizational culture.
The affiliative leadership style fosters emotional connections among team members, promoting a strong sense of belonging within the organization While this approach excels in managing stressful situations, relying solely on praise and encouragement may result in a lack of direction and hinder productivity.
At MORE UK, the representative office's Chef highlights that a lack of decisive leadership and poor decision-making regarding supplier selection are central issues This softness in management leads to challenges for employees, who struggle to maintain relationships with partners and become overly reliant on them Ms Kim concurs with this assessment.
Our boss facilitates easy dealings with the factory due to his close relationship with the VC owner, allowing us to place orders even if their capacity is insufficient, provided the VC owner agrees to our CMT price However, there is a concern that MORE UK could partner with another factory offering the same CMT price but with better production capabilities While he manages the office in a family-style manner and is a good boss, the lack of clear policies means that decisions are often based on experience rather than established guidelines.
A job description is a detailed written statement that outlines the essential duties, responsibilities, required qualifications, and reporting relationships associated with a specific position, as defined by Schneider & Bowen.
Job descriptions play a crucial role in enhancing employee performance by guiding both managers and employees in their daily tasks If your company lacks clear job descriptions, it's essential to engage with your executive team to explore how implementing these descriptions can foster better communication and significantly increase organizational productivity Effective job descriptions ensure that everyone understands their roles and responsibilities, leading to a more efficient workplace.
Employees are often acknowledged by their employers for their exceptional contributions, particularly when they exceed their job responsibilities This recognition frequently occurs when individuals are requested to undertake tasks beyond their usual scope of work.
At MORE UK, the absence of clear job assignments and descriptions has led to confusion among merchandisers and planning staff, resulting in overlapping responsibilities and uncertainty about task completion This lack of clarity often causes team members to shift blame onto one another, highlighting the need for well-defined roles within the organization According to Mr Vinh, a pattern maker, this issue underscores the importance of establishing clear job descriptions to enhance accountability and teamwork.
The lack of a designated person to manage samples at MORE UK leads to confusion and delays, especially when a specific style is needed but cannot be located This uncertainty raises questions about accountability, as it is unclear whether the responsibility falls on the quality controller, merchandisers, or other team members Additionally, the absence of a clear organizational structure exacerbates the issue, leaving employees unsure about who requires information, who is responsible for tasks, and who oversees those tasks.
According to the European Journal of Business and Management, training is a systematic approach designed to enhance employees' skills, knowledge, and competencies essential for effective job performance Well-structured training and development programs significantly improve employee performance while also enabling organizations to optimize their human resources, ultimately leading to a competitive advantage.
Workplace training is crucial for maintaining a safe and productive environment Ignoring its significance can expose companies to risks such as unsafe working conditions, employee dissatisfaction, and reduced productivity Ultimately, this negligence may lead to higher turnover rates, negatively impacting the organization’s overall performance.
At MORE UK, employee training is minimal, relying primarily on individual experience to address challenges New hires receive just 1-2 days of guidance from their predecessors before needing to navigate issues independently The author, a merchandiser with an economics background and no prior knowledge of the apparel industry, highlights the lack of formal training opportunities within the company.
Self-studying from old employees to have knowledge and experience in the garment industry This made employees spend a lot of time when they started working at MORE
To enhance productivity, companies must implement effective planning and scheduling in production This intricate process encompasses various activities to guarantee the timely availability of materials, equipment, and human resources, providing clarity on objectives and timelines When planning is executed properly, employee productivity and reliability improve significantly, leading to faster product throughput and reduced costs.
In an interview with Ms Nhu, a merchandiser at MORE (UK), it was revealed that the company lacks an efficient system for scheduling and planning purchasing orders Currently, the merchandiser controls purchasing orders, but the limited tracking of all customer orders makes it difficult to identify which ones require priority for optimal factory arrangement Furthermore, there are no weekly meetings to coordinate production schedules across all orders, leading to situations where two different customers have overlapping deadlines This results in the factory being assigned to produce orders in a reactive and urgent manner, potentially compromising the quality of the final products.
Proposed solutions
The author identifies several key causes of workplace issues, including inadequate job descriptions, insufficient training, poor planning, and language and cultural barriers To address these challenges, the author dismisses the "Affiliative leadership style" as a viable solution, citing its subjective nature rooted in human personality, which makes it difficult to implement effective remedies Instead, the author employs relevant theories and conducts interviews and surveys with MORE UK employees to explore one or two alternative solutions for each identified cause.
Therefore, this is the solution map for the author to prepare for an action plan later
Creating an official integrated process planning and scheduling
Each merchandiser will take responsible for one step in the ordering process, applying for all customers
Each merchandiser will take responsible to follow up one or two customer in whole process, from receiving purchasing orders to exporting the goods
A job description is a detailed written statement outlining the specific tasks, methods, and working conditions associated with a position It serves as a foundation for creating a job specification, which enumerates the necessary knowledge and skills for successful job performance Typically, job descriptions include sections on job identification, a summary of the role, key responsibilities and duties, the authority granted to the employee, performance standards, working conditions, and the corresponding job specifications.
A clear job description is essential for helping employees understand their responsibilities and expectations It serves as a valuable tool for companies during the hiring process, performance evaluations, and even in potential employee terminations.
At MORE (UK), the absence of job descriptions for various positions leads to confusion regarding accountability when problems arise To address this issue, the author recommends creating clear job descriptions for all key roles within the company, including merchandisers, pattern makers, QA/QC staff, planning personnel, and administrative human resource staff Establishing defined responsibilities will help prevent overlap in duties, particularly between merchandisers and planning staff, whose functions are closely related.
3.2.2 Solution 2: Creating an official integrated process planning and scheduling
The apparel industry's complexity significantly impacts production planning and scheduling, as noted by Bowers MR, who emphasizes the challenge of managing vast amounts of information To address short lead times and frequent small orders, apparel manufacturers, according to Mok PY, are focused on enhancing their processes to ensure timely delivery of finished products while minimizing production costs Consequently, effective planning and scheduling have become increasingly crucial in modern apparel manufacturing.
Understanding the apparel industry's production process is essential, and the author outlines the steps involved at MORE UK for fulfilling a complete order Typically, the timeline from receiving a customer purchase order to achieving the delivery date spans approximately 3.5 to 4 months.
- Planning staff will work with customer and receive the official purchasing order from customers
- Merchandiser will place the order of main fabric in China
- Merchandiser will place the order of trims: button, labels, lining, zippers, that depends on the quotation, MORE UK will choose China suppliers or local suppliers for trims
- Merchandiser will work with the forwarder to transfer all fabric from China and distribute to nominated factories
- At the same time, the technical manager will send the request to sample room to make fit sample, PP sample for customer approval before make the bulk in factory
- Pattern maker will send the tech pack to factory, which is the documents that the factory will be base on to make the bulk
- Merchandiser will contact to local suppliers to transfer all trims to factories
- Merchandiser and QA will follow up the orders, check the specifications and quality for ensuring meeting the hangover date
The basic process at MORE UK involves applying to follow an order However, unexpected supplementary factory costs can arise, impacting the company's expenses To address this issue, the author suggests two potential solutions.
Solution 2.1: Each employee in the merchandiser team will take responsible for one step in the ordering process, applying for all customers
At present, MORE UK has 8 customers (PEACOCKS, MILLERS, DOROTHY
PERKINS, CROSSROAD, KATIES, BOYES, YOURS) There are 6 merchandisers,
2 planning staffs, QA / QC and the pattern makers are not directly related to planning and scheduling, so the author only refers to the merchandiser department
The chief representative should designate a skilled merchandiser to serve as the merchandiser manager, ensuring that all issues are reported directly to this manager rather than to the chief representative Each member of the merchandiser team will be accountable for a specific step in the ordering process, streamlining operations for all customers.
Planning staff 1 + 2 Each planning staff will take responsibility to work with 4 customers, receiving requests from customers and sending the requests to the merchandiser
Merchandiser 1 Responsible for developing and placing the fabrics in China and contacting to the forwarder for transferring the fabric to the nominated factory
Merchandiser 2 + 3 Responsible for developing samples and placing the trims (labels, zippers, buttons, ) and transferring to the factory Merchandiser 4+ 5 Responsible for following up the orders produced at the factory along with the QC to meet the hangover date of the shipment Merchandiser
General management, ensuring all orders of customers are timely
Table 4: Proposed solution assigns the tasks for employee in Solution 2.1
Solution 2.2: Each employee in the merchandiser team will take responsible to follow up one or two customer in whole process, from receiving purchasing orders to exporting the goods
Each merchandiser is responsible for managing one or two customers throughout the entire process, based on the volume of orders For smaller orders, a merchandiser will typically handle two customers, while larger clients, such as MILLERS, are assigned to a single merchandiser Currently, MORE UK implements this approach, where the merchandiser's duties encompass receiving purchase orders from the planning team, sourcing fabrics and trims, liaising with factories, and overseeing production to ensure timely delivery.
The current approach is ineffective; therefore, it is essential for planning staff to collaborate with customers to negotiate a more suitable hangover date Additionally, merchandisers should ensure that all shipment information is communicated to the factory at least two weeks prior to the hangover date To clarify this proposal, a comparative analysis is provided.
Hangover date Purchasing order is placed before customers approve the bulk of fabric
=> the ability to develop fabrics and waiting for customers approval is time consuming, because the bulk of fabric is produced usually takes 45 to 60 days for a style
Purchasing order should be placed after customers approval
When sending the docket to the factory, it is crucial to include the customer's specified hangover date If the factory is unable to complete the goods by the shipping date, MORE UK will request an extension from the customer; failure to obtain approval may result in penalties.
Sending to the factory the docket with the hangover date is sooner 2 weeks than actual date
Table 5: Proposed solution assigns the tasks for employee in Solution 2.2
Appendix 2 includes a purchase order (PO) for style WSTP13245M received by MORE UK from the MILLERS customer, along with a docket sent to the factory The official PO states a hangover date of 23/08/2018, while the docket indicates an earlier date of 09/08/2018, creating pressure on both the factory and the merchandiser to meet shipment deadlines If MORE UK and the factory adhere to the schedule, the shipment will proceed as planned.
On September 8, 2018, the planning team will instruct customers to submit a new purchase order (PO) with the updated hangover date Based on this information, the merchandiser will closely monitor each customer, leveraging their understanding of customer operations and production processes.
33 process of the factory, however, the amount of work is relatively large which makes the merchandiser and the planning staff are always under a lot of pressure
3.2.3 Solution 3: On-the-Job Training
A significant cause of performance issues in the workplace is the lack of training, which can be effectively addressed through On-the-job training According to Dessler, On-the-job training involves learning a job by performing it directly In many organizations, this type of training is the primary method available The most common form of On-the-job training is the coaching or understudy method, where an experienced worker or supervisor guides the new employee This process often includes observing the supervisor or having them demonstrate the job tasks step-by-step, ensuring the trainee acquires the necessary skills.
There are four steps On-the-job training approach can be useful:
+ First, preparing the learner by putting the person and explaining the job and why he or she is being taught
+ Second, presenting the operation by going through it at a normal work pace and again more slowly to itemize key points
+ Third, trying out the trainee by having the person run through the job several times to improve their skills and speed
+ Finally, following up by gradually decreasing supervision, correcting errors and complimenting good work
Alternative sets of solutions
From the analysis above, there are two set of solution are recommended:
To find out what is the best solution, the author conduct a survey
- The method: Qualitative research by questionnaire survey
- Size of sample: 12 employees (6 merchandisers, 2 planning staffs, 3 pattern makers, 1 human resource staff)
- The purpose: Asking employee about sets of solutions, which one is more suitable with company situation
Each employee in the merchandiser team will take responsible for one step in the ordering process, applying for all customers
Each employee in the merchandiser team will take responsible to follow up one or two customer in whole process, from receiving purchasing orders to exporting the goods
Based on the conducting data and analyzes by qualitative research, the author have the result
To sum up the result
+ S1: 100% agree the company should write job description for each position
+ S2.1: 37.5% (3/8 employee were interviewed) agreed that each employee in the merchandiser team will take responsible for one step in the ordering process, applying for all customers
In a recent survey, 62.5% of employees from the merchandiser team, representing five out of eight interviewed, confirmed that each team member is responsible for managing one or two customers throughout the entire process, from receiving purchase orders to exporting goods.
For S2.1 and S2.2, since the departments directly involved in planning and scheduling is merchandisers and planning staffs, therefore, the other employee did not conduct the survey
+ S3: 75% (9/12 employee) agreed that the company should apply On-the-Job training method
+ S4: 16.66% (2/12 employee) agreed that the company should have training programs such as learning English at centers and training with the FAIR program
However the size of the company is too small and the staff does not have enough time to attend these courses, so this solution is eliminated
Based on the survey results, the author recommends a comprehensive solution that includes writing clear job descriptions and assigning each member of the merchandiser team to oversee one or two customers throughout the entire process—from receiving purchase orders to exporting goods Additionally, implementing on-the-job training will help develop an effective action plan.
Action plan
The action plan for writing job descriptions in the merchandiser team involves assigning each employee the responsibility of managing one or two customers throughout the entire process, from receiving purchase orders to exporting goods Additionally, on-the-job training will be provided to ensure team members are equipped with the necessary skills to fulfill their roles effectively.
+ Build a Critical Path – an official ordering planning process, a completed and effective process
+ Help related departments including merchandiser, QA/QC, pattern maker plan to perform their work in a reasonable and timely way
+ Minimize delays in ordering and transferring orders to supplementary factories to speed up production
+ Reduce costs to the maximum in the production of orders
The author outlines an action plan for Solutions 1 and 3, detailing specific activities, timelines, and estimated costs In contrast, Solution 2.2 does not include a specific cost since it is currently implemented by MORE UK with the MILLERS customer By suggesting additional negotiation strategies for customers and factories, the author aims to enhance the planning and scheduling process, ultimately benefiting all MORE UK customers in the future.
3.4.2.1 Solution 1: Writing the job description
+ Define to write job description for positions: merchandiser, pattern maker, planing staff, QA/QC
The human resources department will email experienced staff from relevant departments to schedule a meeting This meeting aims to gather insights on the qualifications and experiences necessary for prospective employees Key information to be discussed includes job identification, job summary, responsibilities and duties, the authority of the incumbent, and performance standards.
The human resources department will draft performance standards, working conditions, and job specifications to create detailed official job descriptions for each position.
+ After completed the Job description, human resource will evaluate with related departments and apply it in new labor contracts and use it when recruite new employee
The estimated cost for developing a job description is calculated based on the working hours of human resource staff With an average monthly salary of 15,000,000 VND for HR professionals with over three years of experience, the daily expense for their involvement in the entire process amounts to approximately 680,000 VND.
Description Working Day Estimated Cost Timeline
1 Define to write job description for positions
2 Organise meetings with experienced employee to ask job analysis
3 Observe and write draft standards of performance, working conditions
30 days 20,400,000 VND From Jan to Feb
4 Write a official job description 45 days 30,600,000 VND From Mar to
5 Evaluate and apply it in new labor contracts and use it when recruite new employee
45 days 30,600,000 VND From May to
Table 7: Timeline and estimated cost for Solution 1
3.4.2.2 Solution 2.2: Each employee in the merchandiser team will take responsible to follow up one or two customer in whole process, from receiving purchasing orders to exporting the goods
To build an effective timeline, the author gives an example of a typical
WSTP13049M, Docket 0097M to show the timeline from receiving the PO from the customer until the factory shipped to the customer
The SKU 00148922 (WSTP13049M) has a hangover date of December 13, 2018, with a total of 4,155 pieces The customer, MILLERS, agreed to issue the official purchase order following the approval of the lap dip on September 17, 2018, which is also the date of the customer's PO.
The timeline for a bulk fabric will be as shown in the table below
Artwork Lap dip Bulk sample Bulk fabric
Develop base on customer requirement
15 days since the lap dip approved
5 days since the bulk sample approved
Table 8: Timeline for a bulk fabric
To optimize fabric development and reduce lead times, the planning team must negotiate the hangover date after lap dip approval, effectively excluding 45 days from the artwork approval process This adjustment allows for a more realistic production timeline, shortening the overall lead time to just 20-25 days for garment completion and export from Vietnam, thus alleviating pressure on UK operations during production planning.
The purchasing order for style number WSTP13049M highlights that the HOT PINK lap dip received approval on September 17, 2018, and the bulk fabric was approved just 18 days later, on October 5, 2018, which is quicker than the anticipated timeframe of 20-25 days Subsequently, arrangements were made to import the fabric to Vietnam, with an estimated arrival date of October 22, 2018, before it is transferred to the factory.
Figure 6: The process of fabric development and importing process
To acquire bulk trims, the merchandiser must place a purchasing order with the supplier for the neck ring trim, using the order code MORSG3213 This process mirrors the fabric development procedure.
Sample Lap dip Bulk sample Bulk trims
Develop base on customer requirement
7-10 days 5 days since the lap dip approved
Table 9: Timeline for a bulk trim
This trim, produced in Vietnam, requires approval after the lap dip process The bulk trims are available in a factory trim of 16/10, with a lead time of just 10-15 days for readiness on the production line The timeline is influenced by the factory's production capacity and the fabric import process into Vietnam.
Figure 7: The process of developing neck ring trims and importing trim
In parallel with the development of fabrics and materials, the merchandiser will set up the docket 0087M and send it to the factory (Appendix), the actual hangover date is
13/12/2018, however the docket sent to the factory will show the hangover date is
29/11/2018, 2 weeks earlier than customer requested This will increase the production pressure on the factory while reducing the probability of late delivery
Figure 8: The actual hangover date and the docket hangover date
The deadline for production specifies the date by which all fabrics and trims must be delivered to the factory to adhere to the production schedule To ensure sufficient production time and maintain garment quality, all materials should be submitted at least two months in advance This is particularly crucial for docket orders.
Due to late shipping, the fabric remained in the factory until October 22, resulting in a four-day delay Consequently, the QA/QC team must ensure thorough molding and quality checks of the product However, the author believes this order will not face further delays or require relocation to a supplementary factory, as the docket was sent to the factory two weeks prior to the actual production date, significantly reducing the risk of lateness and allowing ample time for production.
In conclusion, the author's proposed solution facilitates effective negotiation with the customer by ensuring that the official purchase order (PO) is approved upon lap dip approval By sending the docket to the factory with a hangover date of less than two weeks, this approach is both reasonable and workable Consequently, the standard production time for an order will be reduced to just 2.5 months, thereby minimizing risks and costs for MORE UK.
3.4.2.3 Solution 3: On-the job Training
To do the action plan for On-the –job Training solution, the author propose the plan and the estimated cost to conduct the plan
+ First, human resource will assign the experience employee who will be in charge of teaching for new employee in each position
+ Second, human resource will prepare related documents for this position for example company manual, templates, the right to access to MORE UK server
+ Third, the experience employee will spend time for teaching and trainning new employee
+ Finally, following up by gradually decreasing supervision, correcting errors and evaluate the training program
The estimated cost for training new employees mirrors that of Solution 1, factoring in the hours experienced employees dedicate to training, along with administrative expenses for printing company manuals and templates.
Based on the average salary of a merchandiser, pattern maker, planning staff with over
5 years of working experience is 23,400,000 VND per month, the average daily cost for the experienced employee spend their time to training in stead of working is around 1,100,000 VND
1 Assign the experience employee who will be in charge of teaching for new employee in each position
2 Prepare related documents for training:
20 days 22,000,000 VND From Jan to
3 Teaching and training 60 days 66,00,000 VND From Mar to
4 Evaluate the training program 10 days 11,000,000VND In June 2019
Table 10: Timeline and estimated cost for Solution 3
To enhance operational efficiency, MORE UK should implement a structured solution involving the creation of detailed job descriptions for the merchandiser team This approach will assign each team member the responsibility of managing one or two customers throughout the entire process, from receiving purchase orders to exporting goods The estimated total expense for this initiative is 206,660,000 VND, with an anticipated implementation period of six months in 2019, aimed at developing a more effective system.
The survey questions were contributed for choosing sets of solution
Appendix 1: The survey questions were contributed for choosing sets of solution
1 Would you like to introduce about yourself?
2 What is your position in MORE UK?
3 Can you tell me something about your job?
1 Is it necessary of writing a job description in your position? (Merchandiser, Pattern maker, Planning staff, QA/QC)
2 Is it necessary to apply On- the -Job Training in MORE UK?
3 Is it necessary to apply Diversity Training in MORE UK?
1 Between Solution S2.1 and S2.2, which solution that you think it will be more suitable to MORE UK situation?
2 Why do you think it will be better than the other?
Interview
Chào chị, em là Anh Thư, hiện tại em đang thực hiện đề tài luận văn tốt nghiệp Em rất mong chị có thể cung cấp một số thông tin về tình hình hoạt động của Văn phòng đại diện More UK tại thành phố Hồ Chí Minh Thông tin chị cung cấp sẽ được bảo mật và chỉ phục vụ cho mục đích nghiên cứu của em.
Chị vui lòng cung cấp cho em những thông tin cơ bản như tên, vị trí và công việc hiện tại của chị được không?
Interviewee: Mình tên Dung, mình làm Merchandiser ở công ty này được ba năm rồi Interviewer: Xin lỗi chị vị trí Merchansider (Mer) là như thế nào ạ?
Interviewee: Là theo dõi đơn hàng nha em
Interviewer: Công việc theo dõi đơn hàng là như thế nào chị có thể miêu tả chi tiết giúp em được không?
Theo dõi đơn hàng bao gồm việc nhận đơn từ khách hàng, sau đó tiến hành đặt vải và các nguyên phụ liệu cần thiết Khi nguyên phụ liệu được chuyển đến nhà máy, cần đảm bảo rằng nhà máy nhận đủ số lượng để sản xuất áo theo đơn hàng đã đặt.
Interviewer: Vậy hiện tại những khách hàng chị dung đang theo dõi là những nhãn hàng nào?
Interviewee: Khách hàng Factory Shop, Boyes, Top Shop, Dorothy Perkins, Millers
Interviewer: Hiện tại thì cho em hỏi là bên công ty mình có nhà máy không hay mình chỉ nhận gia công
Interviewee: Hiện tại bên công ty mình thì không có nhà máy chỉ là VPDD tại Việt
Nam rồi sau đó mang hàng đó xuống cho các nhà máy gia công lại cho văn phòng
Interviewer: Những nhà máy đó là bên công ty mình làm hợp đồng gia công đúng không chị?
Khách hàng hiện tại của tôi chủ yếu chuyên về các mặt hàng cụ thể, và công ty chúng tôi thường sản xuất những sản phẩm phù hợp với nhu cầu của họ.
Công ty chúng tôi chuyên sản xuất các loại áo Blouser và áo Blouser nữ, cùng với các mẫu quần dành cho phụ nữ lớn tuổi tại Vương quốc Anh Ngoài ra, chúng tôi còn cung cấp áo jacket, jumpsuit và đầm, với đa dạng kiểu dáng, chủ yếu tập trung vào sản phẩm thời trang nữ.
Chị Dung, xin chị cho biết quy trình gia công với nhà máy diễn ra như thế nào và có những vấn đề nào đã gặp phải không? Khi nhận đơn hàng từ khách hàng, chị có thể mô tả chi tiết quy trình chuyển nguyên phụ liệu vải vóc về nhà máy và cách thức theo dõi đơn hàng tại nhà máy không?
Hiện tại, tôi nhận đơn hàng từ khách hàng thông qua Văn phòng đại diện của công ty mẹ tại Anh Sau khi nhận đơn hàng, tôi sẽ chuyển tiếp cho các nhà máy để báo giá Với kinh nghiệm của mình, tôi biết được nhà máy nào uy tín và chất lượng Tôi sẽ gửi đơn hàng cho nhiều nhà máy khác nhau như A, B, C, D, E, F để nhận báo giá Ví dụ, nhà máy A báo giá 1$, nhà máy B 1.2$, và nhà máy C 0.9$ Sau đó, tôi sẽ lựa chọn nhà máy có giá cả và chất lượng phù hợp nhất để tiếp tục thực hiện đơn hàng.
Sau khi nhận báo giá từ các nhà máy, mình sẽ chọn nhà máy phù hợp để gửi nguyên phụ liệu và thông tin đơn hàng Mình sẽ đặt lịch sản xuất cho đơn hàng, ví dụ như nếu hôm nay là 7/7, mình sẽ đặt cho tháng 11 hoặc 12 Nhà máy sẽ dựa vào đó để lập kế hoạch cho VPDD MORE UK Mình cũng sẽ thông báo số lượng sản xuất cần thiết, chẳng hạn như 1000 sản phẩm, để họ có thời gian chuẩn bị Sau khi hoàn tất thông tin đơn hàng, mình sẽ chuyển sang chuẩn bị vải vóc, NLP và mẫu rập để nhà máy có thể bắt đầu sản xuất.
Interviewer: Hiện tại thì nhà máy nào bên VPDD mình thường sử dụng nhất Bên
More thì dựa vào đơn giá hay mặt hàng để chọn nhà máy vậy chị?
Khi chọn nhà máy, yếu tố đầu tiên cần xem xét là giá cả, tuy nhiên, điều này còn phụ thuộc vào loại sản phẩm Nếu nhà máy chưa từng sản xuất áo Jacket, dù giá có rẻ đến đâu, cũng không nên mạo hiểm giao cho họ sản xuất.
Hiện tại, More đang hợp tác chủ yếu với nhà máy VC, chuyên sản xuất các loại hàng như Blouser, Trouser và đầm Nếu có đơn hàng liên quan đến những sản phẩm này, chị sẽ ưu tiên gửi xuống nhà máy VC trước.
Trong quá trình làm việc với nhà máy VC, có một số vấn đề phát sinh và khó khăn mà tôi gặp phải Những thách thức này bao gồm sự chậm trễ trong giao hàng, chất lượng sản phẩm không đồng nhất và sự giao tiếp không hiệu quả giữa các bộ phận Những vấn đề này đã ảnh hưởng đến tiến độ công việc và yêu cầu tôi tìm ra giải pháp để cải thiện tình hình.
Mỗi nhà máy đều gặp phải những khó khăn nhất định trong quá trình sản xuất Một trong những vấn đề thường gặp là việc chậm trễ trong việc nhận nguyên phụ liệu hoặc vải Ví dụ, nếu đơn hàng được yêu cầu xuất vào ngày 30/8 nhưng nguyên phụ liệu chỉ được giao vào ngày 20 hoặc 10/7, thì nhà máy sẽ không thể sản xuất kịp thời gian đã định Điều này dẫn đến việc không thể đáp ứng đúng hạn giao hàng cho khách hàng.
Để đảm bảo tiến độ sản xuất, tôi thường chuẩn bị đầy đủ nguyên phụ liệu, vải vóc và rập trong khoảng thời gian từ 30 đến 45 ngày trước khi gửi đến nhà máy Nếu gửi trễ, kế hoạch sản xuất sẽ bị ảnh hưởng, dẫn đến việc hàng hóa không kịp xuất đúng hạn.
Vấn đề quan trọng đối với More UK là việc không chuẩn bị đầy đủ nguyên phụ liệu và vải vóc đúng thời gian có thể dẫn đến việc vỡ chuyền sản xuất và trễ ngày giao hàng Trung bình, thời gian để đặt nguyên phụ liệu thường mất bao lâu?
Thời gian sản xuất vải và nguyên phụ liệu thường không giống nhau, với vải mất từ 45-60 ngày và nguyên phụ liệu như nút, vải lót, dây kéo chỉ mất từ 10-15 ngày Quá trình này còn bao gồm việc gửi mẫu cho khách hàng duyệt, làm tăng thêm thời gian hoàn thiện sản phẩm.
Interviewer: Ngoài ra thì còn có vấn đề nào nữa không chị ?
Interviewee: Ngoài ra, khi chị làm việc với VC, chị thấy VC bị rớt nhiều đơn hàng và phải chuyển qua nhà máy khác
Interviewer: Chị có thể mô tả rõ vì sao lại có trường hợp chuyển sang nhà máy khác không ạ?
Related template which using in MORE UK operating procedure
1 The costing sheet of docket 0061M
2 The purchasing order from MILLES of style number WSTP13245M
3 The purchasing order from MILLES of style number WSTP13049M
4 The purchasing order from MORE UK to fabric supplier
5 The purchasing order from MORE UK to trim supplier