Planning is an important aspect in businesses today. Any business that does not take initiative to plan for its future is likely to face challenges which could otherwise be identified during a desk review and planning process (Bose 2002). This document is a continuation to the business plan for Dalnim but now covering Statistics to be used in measuring quality, capacity planning md facility location, an aggregate plan to maintain competitive advantage, work system design, project life cycle, and project management and to inventory planning and management. This is with a view to make the business and financial plan operational.
- Background information
Dalnim was established ten years ago as a sole proprietorship firm to sell ladies business suits. The firm is located at down town Manchester City and has a total staff establishment of three support staff and one director. It is anticipated that this proposed business plan part two will facilitate the firm in achieving both short and long term goals in sustaining its profits and growth.
- Statistics to be used in measuring quality
Quality is the topmost concern in many commercial organizations like Dalnim. The customers’ quality expectations must be met by a firm; otherwise, customers will get dissatisfied and go elsewhere to competitors for search of their desired quality (Kotler 1984).
- Process Control.
The above approach will be aimed at evaluating performance of each individual process so as to foresee any likely variability in quality of output from each process in the immediate future.
Dalnim will use control charts as a main tool in measuring quality under process control. The control Charts will be used to identify instances when the process is out of control leading to defects and therefore poor quality. This will be done for each consignment through sampling so as to be sure that quality control checks are done frequently.
- Product or lot control.
The product or lot control will be aimed at ensuring no lot ready for sale contains a large number of units with unsatisfactory quality. The technique will be useful in deciding whether to accept or reject any given lot produced for marketing.
Dalnim will use sampling inspections to determine from a sample of a given lot whether it meets set quality standards. Judgment of quality for a given lot will be determined by the quality standards of the inspected drawn sample (Mc Carthy & Pervaleut 1994)). This will also be done for each production batch to avoid any poor quality suits getting into the market.
- Concepts related to capacity planning and facility location
Decisions on capacity planning and facility location play a major role in so far as the operations and profitability of any commercial organization is concern. This is because of the cost implication and competitive advantages that are linked to both capacity and facility location as follows.
- Capacity Planning
Delnim will have to address two major issues in regard to capacity planning: (1) the amount of capacity to build? (2) Whether to invest in flexible systems, dedicated or a portfolio of both flexible and dedicated capacity systems? The advantage of adopting a flexible capacity production system is that the system has ability to generate products of a given quantity quickly and economically. This will enable Delnim to address challenges resulting from demand uncertainties. Should the firm decide to broaden its product range, it will be necessary to improve capacity which may require higher investment as compared to the current dedicated system which produces only ladies business suits.
- Facility Location
Decisions on facility location will determine in a great extent costs of running Delnim as well as proximity to customers, both existing and the potential. Location also will determine the security of the firm’s premises. Cost associated with facility location will include leasehold, the closer to the city centre, the higher the leasehold. Other costs related to location of the facility are distribution costs and inbound logistics costs. The far the sources of raw materials, the higher the cost of transport for raw materials and the far and wide customers are spread, the higher the cost of distribution. Delnim will therefore identify an appropriate location for its business so as to ensure that costs related to physical location are minimal and the location is strategic so as to serve as many customers as possible. To cut down on the rental cost, Delnim will hire a room outside the city at low rental rates to serve as both store and workshop. The shop at Manchester city, down town will now be adequate to serve as a show room and selling outlet. Proximity of the two premises will equally be important so as to ensure timely delivery of finished suits from the workshop to the show room at a low transport costs.
- Hybrid aggregate plan to maintain competitive advantage
Dalnim intends to achieve growth of its market share and continue expanding its profitability. To achieve sustainability of both growth and profits, the firm must identify and develop competitive advantages so to maintain an edge over its competitors selling similar ladies business suits at Manchester City. This will be achieved through well thought strategies upon careful analysis of competitors so as to make Dalnim’s products unique within the available range of ladies business suits.
The following are some of the proposed strategies to maintain competitive advantages:
- Unique mode of production
Dalnim has acquired a new modern sewing machine capable of producing various designs with ease. Given that the director is a fashion and design expert, a combination of her unique expertise and modern machines will achieve a unique mode of production competitive advantage.
- Public Relations
Today’s customers are aware of their consumer rights and their expectations whenever they go for shopping has to be met if one intends to keep them for long. Dalnim will provide dedicated customer care and ensure that its customers are given all necessary support during and after shopping that creates a lasting impression.
- Product Mix
Dalnim will widen its range of products so as to sell other ladies wear besides ladies business suits. This strategy will provide the current and future customers with varieties to choose from instead of the current single product line. The approach of selling ladies attires of different sizes to meet various customers’ needs will the unique strategy under product mix.
- High Quality
- Pricing Strategy
Customers are always concern with the cost implication whenever they plan for their shopping. Delnim will strive to continue selling its products at affordable prices without affecting its profitability margins. This will be achieved through maintaining production costs at the minimum.
- Key concepts related to inventory planning and management
Inventory in both commercial and non-commercial enterprises is an important component of assets. This is because, efficient management of inventories has a direct effect on achievement of operational goals as well as the financial result. Efficient management of inventories entails making sure that the inventory levels are at an optimum point. This is important so as to facilitate normal production operations without interruptions and with minimum inventory costs such as immobilized funds held in inventories. The following considerations will be made in regard to inventory management:
- Sourcing of inventories
Proper inventory management at Delnim will start at the point of sourcing. This is because inventories are as a result of procurement for material needs satisfaction. To ensure timely delivery of required textile raw materials at the least possible cost, Delnim will have to enter into partnership with its vendors so as to provide room for information sharing platform. Through partnership arrangement, Delnim may consider having an Electronic Data Interchange system which allows for automatic order placement with its vendors once the stock level hits the re-order levels. This will address the costs associated with stock outs and facilitate rapid ordering and delivery of required raw materials and supplies.
- Storage of Materials.
Proper storage will be considered in achieving good inventory management at Delnim. The firm will therefore invest in storage facilities such as shelves, firefighting equipment, trolleys and a desk top for record keeping. These facilities will ensure that any stored inventories are safe from loss by theft, pilferage and fire.
- Inventory Control
A well planned flow of inventories is essential to achieve efficient operation of Delnim’s. Too great supply of inventories results in high storage costs, excessive capital being held up, shortage of valuable space, stock losses and obsolescence, while a short supply results in reduced output and panic buying to meet unexpected high demand over a short notice (Owler and Brown1985). Dalnim will therefore require proper inventory control to ensure optimum inventory levels are maintained at all times to avoid risks associated with having too much inventories or too little inventories.
- Inventory policy
The firm will ensure that it develops an adequate Inventory Management policy that will achieve balance in both inventory requirements for production process and the market demand while keeping inventory related cost at their lowest. The policy will also address the checks and balances to ensure safety of inventories.
Bose, C. D. (2002). Principles of Management and Adminstration. New Delhi.
Mc Carthy, J. & Pervaleut, W. (1994). Applications in Basic Marketing: Clipping from the Popular Business Place. Massachusetts: Irwin Inc
Kotler, P. (1984). Principles of Marketing. New York: Prentice Hall
Owler, L.W.J & J.L.Brown (1985). Wheldon’s Cost Accounting.London: Pitman Publishing