REPORT

ON

THE ROLE OF TRANSPORTATION IN LOGISTICS SUPPLY CHAIN IN RMG

( QUAZI ABEDIN TEX LIMITED )

1 | P a g e

THE ROLE OF TRANSPORTATION IN LOGISTICS SUPPLY CHAIN IN RMG ( QUAZI ABEDIN TEX LIMITED )

Prepared For:

Nikhil R. Dhar Course Instructor

Physical Distribution & Logistics Management (SCM 502)

Prepared By:

Partha Protim Rakshit

Student ID No. 15106002

University of Asia PacificDhaka, Bangladesh

Date of Submission: 09.12.2016

2 | P a g e

LETTER TRANSMITTAL

December 09, 2016

Nikhil R. DharCourse TeacherPhysical Distribution and Logistics ManagementDepartment of Business administrationUniversity of Asia Pacific

Subject: Submission of Report

Dear Sir,

I am pleased to submit the Report as a partial fulfillment of MBA program. I tried my best to present this term paper report on “The Role of Transportation in Logistics Supply Chain in RMG (Quazi Abedin Tex Ltd.)” according to your guideline. I tried my level best to work sincerely to cover all aspects regarding the matter.

However, if you need any clarifications, suggestions, directions or recommendations for further improvement of the report, I will obligate to provide with further explanation. I sincerely hope that you will appreciate my effort.

Yours’ sincerely,

Partha Protim RakshitID No-15106002MBADepartment of Business administration

Acknowledgement

3 | P a g e

The successful completion of this report might never been possible in time without the help some person whose inspiration and suggestion made it happen. First of all I want to thank my supervisor Nickhil R.Dhar,Ph.D for guiding me in Transportation in Logistics Supply Chain in RMG my report paper. Without his help this report would not have been accomplished. Then I would like to thank my advisor, Mohammed Alam (Assistant-Manager in Commersial Department) for helping me completing my report on “Transportation in Logistics Supply Chain in RMG”. I would like to express my gratitude to all the faculty and staff members of University of Asia Pacific and specifically, Asia Pacific Business School. This report is a culmination of this semester I have spent here and all that I have learnt. I also thank my colleagues who helped me by providing informative instructions. I was closely attached with them during my internship tenure. Without them this project would have been very difficult. I also thank my parents, and some friends who kept on this long process with me, always offering support. And finally I also express my sincere gratitude to all those who participated to prepare the report.

Contents

4 | P a g e

Top Page ITitle page IILetter of Transmittal IIIAcknowledgement IVContents VExecutive summary VI

Sections Description Page No.1.0 Chapter: 1 INTRODUCTION 1-2

1.1 Introduction 11.2 Objective 11.3 Methodology 11.4 Data Collection 21.5 Scopes and Limitations 2

2.0 Chapter: 2 Introduction to Quazi Abedin Tex Limited 33.0 Chapter :3 Transportation in Logistics Supply Chain In

RMG4-8

3.1 Components of logistics system 43.2 QATL Transportation and Logistics: 53.3 The Supply Chain 63.4 The Relationship between Transportation and

Logistics6

3.5 Forms of logistics operation 73.6 Future Prospects of Logistics 7

4.0 Chapter :4 DISCUSSIONS AND CONCLUSIONS 94.1 Discussions 94.2 Recommendation 94.3 Conclusions 10

REFERENCES 11Acronyms 11

Executive Summary

5 | P a g e

Logistics management is the network of activities where the raw material is purchased then transformed into the usable goods and then finally delivered to the customers through the distribution systems. The Readymade Garment (RMG) industry of Bangladesh tells an impressive story of country successful transition towards a major export- oriented economy. Starting its journey in the late 1970s with relatively small investment, the industry, the industryflourished in 1980 and 1990 and has become the largest industry in Bangladesh. Thecontributory factors of the RMG industry in Bangladesh are global trading agreement,cheap labor cost, government policy support and dynamic private entrepreneurship.

This report is based on the principle of the transpotation in logistics channel of Quazi Abedin Tex Ltd. By this paper, we will understand the elements & forces of the transpotation in logistics channel.

The transpotation in logistics channel is the study of how cost is increased and how this poblam solution, think and feel in an organized setting. As this is a group of company, so there will be different types of transpotation system.

This study is an attempt to evaluate the various steps that can improve the quality of transpotation, empowerment & participation, stress management success of an organization. It starts with a brief description of the transpotation channel, transpotation development, teamwork empowerment & participation in the logistics channel. I am assuming that the company, which has come to me for advice, is of similar nature of business and size. The steps taken by Quazi

Abedin Tex Ltd. were successful as the bottom line of the company justifies the same.

Chapter: 1

Introduction

6 | P a g e

1.1 Introduction:

Bangladesh had a historical reputation in production of textile products in addition tofamous Dhaka muslin. In the early 1980s, there were small-scale independent investments in the readymade garments (RMG) sector. At that time, it was not considered viable and received very little government attention. However, the sector grew with vengeance and the countrycurrently exports over US$11 billion in textiles and garments, with a projected target ofUS$24 billion dollars by 2020. Though we commenced our business in 1965, we actually stepped into the woven garments manufacturing business in 1983 with our pioneering unit Abedin Garments Limited. Quazi Abedin Tex Limited (QATL) is the 4th project in garments sector of Group QA.

As you now know, procurement process is vital in today's companey. My topic is the role of transpportation in logistics supply chain management in RMG.I chose Quazi Abedin Tex Limited (QATL). QATL is one of the renowned names in Bangladesh which has started its business in April 2014 and doing its business quite well. QATL has started its business in the field of  RMG production.

QATL has also endeavored to strengthen its network in international marketing operations to export its products abroad. We are optimistic about our continued growth and success. We have clear goals that inspire us and we believe to be possible for us to reach. We continuously strive to reach our goal of being the best in our field which indeed is what QATL stands for.

1.2 Objectives:

The role os transportation in logistics supply chain in Quazi Abedin Tex Limited (QATL).

1. 3 Methodology :

To make this report meaningful and presentable, I used primary and secondary research base. Most of the data came from my critical observation. Primary data came from my experience, observation, unstructured interview. On the other hand secondary data has been collected through internet, different journals, and regular reporting.

1. 4 Data Collection :

The present study has been conducted based on both primary and secondary sources of data and case study.

1.4.1 Primary data:

7 | P a g e

The study will be conducted within the organization to represent the procurement process of Quazi Abedin Tex LimitedThe primary data gathered from the face to face interview in Commercial department, procurement departmant, merchandising depatment, factory admin sector GM.

1.4.2 Secondary data:

For the information of the report both primary and secondary sources of data have beencollected. But mostly the primary data are used. Primary sources of data consists various datacollected by informal interview with the employees. Secondary sources including several studieson Quazi Abedin Tex Limited of the website publications have been used for this purpose.

1. 5 Scopes and Limitations

An inability to answer your research questions Theoretical and conceptual problems Limitations of your research strategy Problems of research quality Budget problem Limited time The research is confined to just one company Lack of technical expertise Lack of manpower and other resource constraint

Chapter: 2

I ntroduction to Quazi Abedin Tex Limited

Though we commenced our business in 1965, we actually stepped into the woven garments manufacturing business in 1983 with our pioneering unit Abedin Garments Limited. Gradually,

8 | P a g e

we developed two other units namely, Kaniz Garments Limited in 1994 and Kaniz Fashions Limited in 1998. All three factories were housed in rented accommodations.

In view of the growth of our business and the challenges of various issues with particular reference to post multi-fiber agreement era, Group QA has established its own RMG production plants at 228/A, Tejgaon Industrial Area, Dhaka-1208, Bangladesh and started operation on 1st January 2003. It is a 9-storied building with the total floor space of about 1,60,000 square feet. We firmly ensure a healthy working environment and address various aspects of compliance issues and welfare of our employees. We have about 3500 efficient work force, capable of production over 4 million woven garments per year.

Quazi Abedin Tex Limited (QATL) is the 4th project in garments sector of Group QA. QATL has established its own RMG production plant at Shovapur, Rajfulbaria, Savar, which was founded in July 2011. It started its commercial production from April 2014. It will be a Taka 700 million project of composite knit textile and garments.

It’s a giant project covers 6 acre areas consisting of 3 blocks of 10-storied buildings with the total floor space of about 63,000 square feet. We are planning to firmly ensure a healthy working environment and address various aspects of compliance issues and welfare of our employees. It will be capable to employ more than 8000 workers when goes into full-fledged operation. Initially it will employ 1,500 workers.We hope to upgrade this company in a new level of success within a short span of time.Staff strength: About 700

Presently, we are recognized as a state-of- the art manufacturing facility of woven garments in Bangladesh.

Board of Directors:

1. Quazi Zaniul Abedin (Chairman)2. Quazi Nazmul Abedin (Managing Director)3. Mrs. Nilufar Abedin (Director)4. Quazi Ehsanul Abedin (Director)

Factory Management:1. Quazi Golam Ali (Executive Director)2. Quazi Sakhawat Husain (General Manager)

Chapter: 3

Transportation in Logistics Supply Chain In RMG

3.1 Components of logistics system

9 | P a g e

The logistics system consists of the following components: Customer service, Inventory management, Transportation, Storage and materials handling, Packaging, Information processing, Demand forecasting, Production planning, Purchasing, Facility location and other activities.

Other activities for a specific organization could include tasks such as after-sales parts and service support, maintenance functions, return goods handling and recycling operations.

Clearly any one organization is unlikely to require all these specific tasks to be accomplished. For example, a service firm such as an airline might combine elements from the information processing, maintenance, demand forecasting, customer service, and purchasing functions into a logistics system designed to reach its customers. On the other hand, a manufacturer of consumer goods may draw from transportation, inventory management, storage, materials handling and packaging in addition to customer service, purchasing and demand forecasting for their logistics support.

The point is that every organization, be it manufacturer or service provider, for-profit or non-profit, has customers that it wants to reach. By integrating the appropriate functions into a customer-focused logistics system, the enterprise can develop a sustainable advantage that is very difficult to be imitated by a competitor. Sorne of these activities have traditionally had a

10 | P a g e

well-defined stand-alone role within a company (purchasing, production, information processing), while others have generally been more closely associated with logistics (transportation, warehousing, packaging). What ties all of these functions together is their ability to improve customer satisfaction. This is not to say that production, for example, should be subordinate to logistics. Rather top management should utilize logistics as a way to integrate these corporate activities and keep them focused on the customer rather than on internal processes.

QATL Components of logistics system:

All garments factory Components of logistics system is same. Customer service (Buyer service), Inventory management, Transportation, Storage, and materials handling, Packaging, Information processing, Demand forecasting, Production planning, Purchasing, Facility location and other activities.

But garments collected the order and buyer selected supply name, as a result back to back order produce purchases. QATL ware house is so big, large amount raw matarial inventory . This companey has fixed C&F and fixed transport support and work some forwared.

Raw matarial is purcheased outside in our country about 75%. aoly 25% is buy local and EPZ.

3.2 QATL Transportation and Logistics:

This company 75% come in foreign, so used varieties kind of transport is used. Logistic is the main sector is transportation. Generally used ship and air. But 75% produced come in the ship and 24% comes on by air, and only 1% come on by road.

C&F collection produced in port. C&F this produced is Transfer Company selected Transport Company and used sometimes transport company warehouse. Transport company this send in the factory by truck, pickup van, and covered van.

3.3 The Supply Chain

Logistics/SC is a collection of functional activities (transportation, inventory control, etc) which are repeated many times throughout the channel through which raw materials are converted into finished products and consumer value is added. Because raw material sources, plants, and selling points are not typically located at the same places and the channel represents a sequence of manufacturing steps, logistics activities recur many times before a product arrives in the marketplace. Even then, logistics activities are repeated once again as used products are recycled upstream in the logistics channel.

11 | P a g e

QATL logistics is mainly work transportation. Logistics team continuous data collection shiping time, ETA, berth, unstaffing etc. Not only shiping sector they colected data air way. Logistics team work local transport. Local transport is used for collected & send the good for port.

3.4 The Relationship between Transportation and Logistics

We consider the relationship between transportation and logistics. The basic purpose of this subject is (a) to make a theoretical analysis on the study of logistics and transportation, (b) to review the estimation and measurement of transportation. In the manipulation of logistics transportation plays a crucial part. In the later half we have focused on the environmental effect and the key challenges in the transportation/ logistics. Reviewing the current conditions, the recent technological development has made possible the trading of formalized options around transportation and logistics.

3.5 F orms of logistics operation :

Supply chain management is how logistics providers are able to handle the production procedures on a wide scale. Using supply chain management it is possible to satisfy the demands that have formed as a result of the new business environment. 

The supply chain includes three major areas: purchasing, manufacturing and transporting. All of these components need to be successfully managed for the supply chain to work effectively. In

12 | P a g e

logistics it is necessary to have an eye on all of these processes; from the suppliers all the way to the customers where the supply chain often stops (providing returns aren’t required).

By being able to effectively manage all of the processes in the supply chain it is possible to ensure an improved flow. This is beneficial to all parts of the chain, especially the customers who are able to experience excellent customer service as a result of the management.

3.6 F uture Prospects of Logistics

Facing the worldwide competition, the improvement of logistics system should be advancedby both private companies and government. Weld and Roszemeijer (Ho, 1997) discernedthree revolutions in business that have substantial impacts on the purchasing and supplystrategies of the manufacturing sectors. These three revolutions are: (1) the globalisation oftrade; (2) the coming of the information era; (3) more demanding consumers and continuouslychanging consumer preferences. The main characteristics of future logistics development are:

• Government role: To keep competitiveness of industries, the government has to lead theway to assist the logistics industries. However it involves large of investments and some problems relating laws and national policies. Without the lead and support of government, achieving the plan is difficult.

• Growth of international goods transport: The up-growth of international freight transportis contributed by several factors. Firstly, the blossoming of E-commerce pushes ahead theinternational business activities. Secondly, the change of production strategy needsinternational cooperation, e.g. importing the semi-finished products from countries withProceedings of the Eastern Asia Society for Transportation Studies, Vol. 5, pp. 1657 - 1672, 2005,1669.

• Improvement of services: Providing a good customer service becomes a necessaryrequirement of business operation with the intense competition of global market. Thequality of services is the main factor to affect consuming behavior among the enterpriseswith high similarity. The service systems involve several developed techniques now, suchas Efficient Consumer Response (ECR) and Quick Response (QR). In the near future,more new techniques would be applied in providing better services for customers.

• Revolution of logistics operation: IT techniques and its products bring efficiency andfluency to the logistics systems. Radio Frequency ID (RFID) is one of these techniques.The main difference between the bar-code system and RFID is that RFID does not needthe action of scanning the barcode on goods. RFID could save manual operation timedramatically. RFID systems could sense the amount of goods input in the tags

13 | P a g e

automatically and immediately when the costumers push their trolley through the exit(Carroll, 2004).

• Shorter product life cycle: With the current trend, the merchandise design is changing dayby day, and therefore, the product life cycle is shorter and shorter, especially in computerscience. To confront the impacts, logistics system must improve its efficiency andreliability of goods delivery. Otherwise an inappropriate logistics system would hinder thecompetitiveness of new products and the business profits.

• Improvement of logistics facilities: The advancement and development of logistics arebased on several techniques and complete theories. High-tech facilities and systems, e.g.ITS, could bring more possibilities and advantages to logistics. For example, theimprovement of related facilities, e.g. Forklift Trucks, is necessary for transport efficiency.In the future, factory automation is the main target for the whole supply-chain procedures.It could help to improve efficiency and also reduce the operation costs.

• Channel cooperation between companies: In order to save the logistics costs, a keyconcept is to maximize the usage of available transport capacity. Integrating the logisticsdemands between numerous departments helps achieve this purpose. In practice, aconglomerate could develop its own logistics service for the branches. For some mediumsize companies, they could cooperate transport channels with others.

• Specialized logistics delivery: One of the notable trends of logistics industries isspecialized delivery service. For instance, delivering fresh food from the place of originneeds low-temperature containers. Compute chips, gases and petroleum need particularconveyances to carry. These demands are rising since the products became more and moredelicate.

• Logistics centers: The development of logistics centers is good for industry promotionand the development of national economic system. Logistics centers could successfullyshorten the distance between production and marketing vertically and also integratevarious industries horizontally, and thus decrease the costs. Governments can proposespecial areas for storehouses and logistics to reduce land acquisition. The future logisticswill cooperate e-commerce, the Internet and the newly door-to-door service to create newbusiness prospects.

Chapter: 4

DISCUSSIONS AND CONCLUSIONS

4.1 Discussions

14 | P a g e

How to speedily deliver products to consumers’ hands is a common consensus of operators.Integration of logistics and e-business is the future trend. In order to get more advantageousposition and build a complementary and dependent relationship, networking industries, suchas Yahoo and e-Bay, usually cooperate with logistics industries. The integration could reducethe middle-level procedures. The producers could immediately give the products over to theterminal customers. This could reduce expenses and also administer sources more efficiently.Besides, the companies do not have to take the costs of inventory and warehouse, andtherefore they become modernized industries of low cost, more efficiency and division ofspecialty. For example, customers could get ordered goods from convenience stores. Throughe-logistics, the competition condition of industries could be promoted in knowledgeeconomics.Based on the discussions of previous paragraphs, the integration and promotion of businessactivities have to involve transportation systems at various stages. The integration of variousapplications brings the convenience through promoting the system of information flow andbusiness operations. Customers and firms could make business more efficient and easierthrough the help of e-commerce and the Internet. However physical delivery still relies on thetransportation system to finish the operations. The cost of transportation operation may beone-third of logistics costs. Meanwhile, transportation systems and techniques are needed inalmost every logistics activity. Thus the reform of business patterns has to considertransportation systems.

4 . 2 R ecommendation

This company needs change some option at the present time. There are

Central ERP software: This is included companies all sector.

Inventory Management Distribution Customer Procurement Transportation Online Cheat E- Commerce POS (Point of Sales) Others

2. Online logistics security: This is online base work. All transportation used GPRS system and camera. So location tracking and product information are timely. Any kind of bad occurs this is saved in the server. This is 24/7 security.

3. RFID (Radio Frequency Identification): Successor to the barcode for tracking individual unit of goods. RFID does not require direct line of sight to read a tag and information on the tag is updatable.

15 | P a g e

4. Market analysis software: A market analysis studies the attractiveness and the dynamics of a special market within a special industry. It is part of the industry analysis and thus in turn of the global environmental analysis. Through all of these analyses, the strengths, weaknesses, opportunities and threats (SWOT) of a company can be identified. Finally, with the help of a SWOT analysis, adequate business strategies of a company will be defined. The market analysis is also known as a documented investigation of a market that is used to inform a firm's planning activities, particularly around decisions of inventory, purchase, work force expansion/contraction, facility expansion, purchases of capital equipment, promotional activities, and many other aspects of a company.

5. Forecasting Software: Forecasting Software importance in companies because how many products will demand in next month.

4 . 3 Conclusions

This paper covers broadly from logistics activities to transportation systems and attempts todetermine the role of transportation in logistics systems through extensive review. The maincontents of the research include a review of logistics development, the characters of varioustransport operations in logistics activities, the applications of logistics in various fields, citylogistics, future direction in logistics development, and its cooperation with transport systems.To sum up, logistics and transportation have some relevance. (1) Logistics system has a moreand more important position in our society activities. (2) Transportation and logistics systemshave interdependent relationships that logistics management needs transportation to performits activities and meanwhile, a successful logistics system could help to improve trafficenvironment and transportation development. (3) Since transportation contributes the highestcost among the related elements in logistics systems, the improvement of transport efficiencycould change the overall performance of a logistics system. (4) Transportation plays animportant role in logistics system and its activities appear in various sections of logisticsprocesses. Without the linking of transportation, a powerful logistics strategy cannot bring itscapacity into full play.

The review of logistics system in a broad sense might help to integrate the advantages fromdifferent application cases to overcome their current disadvantage. On the other hand, thereview of transport systems provides a clearer notion on transport applications in logisticsactivities. The development of logistics will be still vigorous in the following decades and thelogistics concepts might be applied in more fields.

REFERENCES :

BTRE (2001) Logistics in Australia: A Preliminary Analysis. Bureau of Transport andRegional Economics, Canberra, <http://www.btre.gov.au/docs/wp49_contents.htm>.

16 | P a g e

Carroll, J. (2004) The magical reserve tracing system-RFID. Taiwan CNET,http://taiwan.cnet.com/enterprise/technology/0,2000062852,2008707 1,00.htm

Krumwiede, D.W. and Sheu, C. (2002) A model for reverse logistics entry by third-partyproviders, Science Direct, Vol. 30, 325-333.

Potrol (2003) Inner freight transport and city logistics. Potrol transport teaching material.Reynolds-Feighan, A.J. (2001) Air freight logistics. In A.M. Brewer, K.J. Button and D.A.

Hensher (eds.), Handbook of Logistics and Supply-Chain Management. Elsevier ScienceLtd., UK, 431-439.

Acronyms :

EOQ Economic Order QuantityERP Enterprise resource planningSMS Short Message ServiceLC Letter of CreditRFID Radio Frequency IdentificationWIP Work-in-processMRO Maintenance, repair & operatingSWOT Strengths, Weaknesses, Opportunities and Threats analysisETA Estimated Time of Arrival

17 | P a g e