Executive SummaryThepurpose of this report is to do a current SWOT analysis of Hosiery Industry ofPakistan. This report aims to represent the current problems, opportunities,weaknesses, strengths and threats to the industry. For this report we have takenhelp from online resources, previous reports and interviewed business ownersand managers to get a more current insight on the currently prevailingsituation of this industry. This report is targeted toward business owners,managers, industry professionals and other stake holders to provide them aninsight on current state of industry, reasons of its decline and what steps canbe taken to recover from this decline.
This report also provides anintroduction and significance of hosiery exports to academia: students andinstructors so that they have a basic idea of job market in this industry andthe skills they should obtain if they intend to work for hosiery industry infuture. We are thankful to Mr. Salman Mir from R&D department SCCI and Mr.Aneeb Ahmad CEO of Straps Intl. a firm exporting and providing localmanufacturers with patterned, logo and text based laces. Table of Contents Executive Summary. 1 Table of Contents.
2 Introduction. 3 What is the purpose of this report?. 3 Who are the readers of this report?. 3 What are the report’s main messages?. 3 How this report is structured?. 3 Hosiery Industry of Pakistan. 4 SWOT Analysis. 5 Strengths.
5 Weaknesses. 5 Opportunities. 5 Threats. 5 Conclusion.
6 Recommendations. 7 References. 9 IntroductionWhat is the purpose of this report?This report is a part of ESP.
Thisis our final project report .The purpose of this report is to do a current SWOTanalysis of Hosiery Industry of Pakistan. This report aims to represent the currentproblems, opportunities, weaknesses, strengths and threats to the industryWho are the readers of this report?The target audience of this reportis students and teachers related to business education, business owners,managers, industry professionals and other stake holders.What are the report’s main messages?The report aims to provide aninsight into reasons of ongoing decline of hosiery exports. Which seem to bethe lack of R&D and Technology infrastructure.
How this report is structured?The report is divided into threeparts, Introduction which consists of this page: the introduction of report,executive summary: stating the purpose and need for this report, and finallygeneral introduction of the industry. The second part of this report is SWOTanalysis and the third part contains conclusions and recommendations for theindustry. The references to the sources used are at the end of this report. Hosiery Industry of PakistanThisreport aims to describe SWOT Analysis of hosiery industry of Pakistan.
Hosieryindustry of Pakistan consists of manufacturing, sales and export of productssuch as Shirts / T-Shirts, Hooded Jackets / blazers, Trouser, Knitted BedSheets, Knitted Fabrics, Socks & other garments. The products aremanufactured with imported machinery and materials e.g. yarn.PakistanHosiery Manufacturers Association is the central body that represents thestakeholders of the industry.
The hosiery manufacturers are registered membersof this association. A list of all members can be found on the website of theAssociation referenced at the end of this report. (Pakistan Hosiery Manufacturers Association)Pakistan Hosiery Manufacturers Association’s central office is centrally located in idealsurroundings at PHMA house off. Shahrah-e-fasial in P.E.C.H.S.
, block-6 just akilometer away from Export Promotion Bureau office. For year 2017-2018, Dr Khurram Anwar Khawaja was elected as new central chairman of PakistanHosiery Manufacturers Association has elected while Shahid Rafi and Naeem Ahmed were elected as senior vice chairman and zonal chairman (North) (The Nation) SWOT AnalysisSWOTis short for Strengths, Weaknesses, and Opportunities in Threats. In thisreport we carry out the SWOT analysis of Hosiery industry of Pakistan and pointout the reasons that may contribute to its rise or decline.Strengths· Availability ofcheap labor· Self-sufficiencyin availability of cotton based raw material· Tax free exportpromotion zones setup by governmentWeaknesses· Low R isthe biggest weakness which also leads to other weaknesses listed below· Localunavailability of plastic and polyester based raw materials· Reliance onimported machinery· Lack oftrained, specialized skill labor· High cost dueto lack of systematic production and administrationOpportunities· Low barriers ofentry· New Designs andMaterials· Local Sales asdemand for hosiery products has increased locallyThreats· Competitionfrom India, China, Bangladesh countries· Diminishingexports due to international economic slowdown ConclusionFrom the above analysis we have reached thefollowing conclusions:The main reason of decline of hosieryindustry exports is foreign competition.
China, India, Bangladesh and othercompeting countries are able to produce better products at cheaper prices. Theycan produce it at cheaper prices because they have spent resources on researchand development. These countries are producing their own machinery while inPakistan we are reliant on importing machinery from China. They have developed sophisticatedmanufacturing processes by incorporating industrial engineers in the field sothey can produce products and introduce features that we can’t integrate in ourproducts without significant expenditure that small industry owners aren’t ableto afford. By achieving economies of scales these countries have reduced theiroverall cost. Also strict standards regarding materials used and stringentlabor law standards set by brands, and foreign governments such as EuropeanUnion are hard to fulfill by small manufacturers here. Because many kinds ofmaterials is imported in lots, it is difficult for local manufacturers toprovide consistent quality.
The foreign competition has also worked ontheir supply chain strategies. They are able to reduce cost and ensure highquality standards.Last but not least, there is two kinds ofcompetition going on here in this industry, first is the foreign competitionbeing faced by industry in Pakistan that has reduced profits and second thelocal competition here is so fierce that profits margins are low to pennies perunit. This reduces the overall export revenue and volume.Due to lack of government incentives andsupport, and unstable economic conditions, manufacturers avoid spending on anytechnology or research and development due to high risk whether theirinvestment will reap reward or not and keep expenditure to a bare minimum, justadministration cost and expenses needed to keep manufacturing units running.RecommendationsOur first recommendation for the betterment of hosieryindustry would be to to government.
Government should provide incentives forhosiery and textile industry in form of relief on tax and custom duties forimporting new machinery and technology. Government can also help themanufacturers by setting up a research and development department specificallyfor this industry so that it can benefit all instead of just a few wealthyorganizations bearing the cost of R and keeping the benefits tothemselves.Manufacturers should keep themselves informed and updatedwith latest standards required by their export markets and take steps toincorporate them gradually so that they don’t have to spend resources suddenlywhen their customers start to require these standards on a strict basis.Government should make policies to ensure economic stability.Economic stability can only be achieved if exports are less dependent onimports for which government should promote manufacturers of materials andmachinery, to incorporate benefits from engineering into industry and make morejobs for engineering grads.
Academia stakeholders should make the criteria offinal projects such that they are practical and implementable in localindustry. This step can ensure a huge boost toward the technological setback inall industries of Pakistan.Another recommendation toward state bank would be to makepolicies such that banks that provide services to businesses can give prioritybased services as centralization of banks has led to a decline in quality ofservices provided to businesses. As small branches can’t provide most businessservices without authorization from headquarters which is a time consuming andcumbersome process i.e. for getting approval of a business loan for a year, abusinessman is engaged negotiating with all the hierarchy levels located inmultiple branches for each step from lien to insurance to approval.
Last we’d like to appreciate the work of Chambers ofCommerce all over Pakistan but particularly Sialkot chamber of commerce for thesupport the industry and the help provided by Mr. Salman Mir (R&D officer)from Sialkot Chamber of commerce toward making the concepts about hosieryindustry’s current position in Pakistan clear to our project group.