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

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 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.

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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

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 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 work
by 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.

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 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.................................................................................................................5
Chapter 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 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.....................................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..........................................................................7
And 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......................................................................................................7
1.2 Vision.........................................................................................................................8
1.3 Organizational Values.............................................................................................8
Chapter No 2........................................................................................................................9
BUSINESS OPERATION...................................................................................................9
2.1 Organization Structure (Organization Chart).............................................................9
Chief Executive Officer...................................................................................................9
Managing Director...........................................................................................................9
Manger Operations...........................................................................................................9
Purchase Manager............................................................................................................9
Production Manager.........................................................................................................9
Marketing & Sales manger..............................................................................................9
Accounts Manager ..........................................................................................................9
2.2 SWOT Analysis.......................................................................................................10
2.2.1 STRENGTHS ..................................................................................................10
2.2.2 WEAKNESSES................................................................................................11
2.2.3 OPPORTUNITIES ...................................................................................................12
2.2.4 THREATS.........................................................................................................13
2.3 Marketing Strategy...................................................................................................14
2.4 Marketing Mix.........................................................................................................14
2.4.1 Product Mix......................................................................................................14

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 ....................................................................................................................................17
..............................................................................................................................17
2.4.2 Pricing ..............................................................................................................18
Physical Distribution .................................................................................................18
2.4.3 Places................................................................................................................18
2.4.4 Promotional Activities......................................................................................19
2.5 Competitive Strategies of AF...............................................................................19
2.6 Business Process Analysis............................................................................20
Chapter N0 3......................................................................................................................23
Learning as a student intern...............................................................................................23
3.1 Duties.......................................................................................................................23
3.2 Accomplishments.....................................................................................................24
3.3 New Knowledge Acquired.......................................................................................25
3.4 How Experience Impacts your Career.....................................................................26
References......................................................................................................................26

Chapter No 1

BACKGROUND OF THE HOST ORGANIZATION

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1
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 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

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“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

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 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

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 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

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 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.

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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.

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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.

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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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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

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 • 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.

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 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.

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Diagram:

Hierarchy in Marketing and Sales Department

Order from Marketing and

customers Sales
Department

Request to Sample to
Production customer
department

Request to
Purchase
department

Account Production
department department
Finance starts work

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

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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,

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 • 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

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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.
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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. The
fulfillment 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 the
production cost and profit margin of company.

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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 any
textile 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/

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