Azgard Nine Limited

AZGARD NINE LIMITED
2.5 Km off Manga, Raiwind Road, Pakistan

Phone: +92 (0)42 111-786-645
Fax: +92 (0)42 538 3591
Website: www.AZGARD9.com
Supervised By:
Saqib Hussain
Business Development Manager
Email: Saqib.Hussain@azgard9.com
Internship Advisor:
Tariq Hameed Alvi
Lecturer Management Sciences
Submitted By:
Saad Mahmood
MBA-FA08-124
Submission Date:
September 1, 2009
Azgard Nine Limited Internship Report
Acknowledge
At first I am thankful to Almighty ALLAH and the Holy Prophet (P.B.U.H), their
blessings have been have with me in all good and bad times.
Then I’m grateful for the thorough support by my advisor Prof. Tariq Hameed
Alvi for helping me determine the objective of the report and guiding me though to
get to the end. He made me grateful with his valuable suggestions from time to time
during my internship.
I must thank Mr. Saqib Hussain (Business Development Manager) and Shah
Bano ( Deputy Manager Marketing) for providing related information on which this
project is based. He has been a great support from the choice of the topic, learning
of different part of research and understanding the difference between theory and
practices.
I really should thank every other employee of Azgard9, whom I found during
different phases of my internship. Most of them have been very open and friendly
with me and provided me with the answers I needed from them. They were the
constant source of inspiration and encouragement that helped in completion of my
internship.
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Table of Contents
Page
1. Executive Summary 1
2. Industry Overview 2
2.1 Textile Industry 2
2.2 Spinning Industry 3
3. Introduction of Organization 6
3.1 History of Azgard9 7
3.2 Company Vision 7
3.3 Company Mission 8
3.4 Core Values 8
3.5 Corporate Philosophy 9
3.6 Code of Business Principle 9
3.7 Products 10
3.8 Services 10
3.9 Name of Department 10
3.10 Name of Unit 10
3.11 Structure of Unit 11
3.12 Culture 12
3.13 Customer 12
3.14 Markets 12
4. Introduction of Business Division 13

4.1 Spinning and Specialized Yarn 13
4.2 Spinning Process 14
4.3 Denim Fabric Division 15
4.4 Denim Fabric Process Flow Chart 16
4.5 Garment Division 17
4.6 Garment Division Process Flow Chart 18
5. A Managerial View 19
5.1 Departmental Flow Chart of GBU 19
5.2 Planning Process and Tools / Techniques 20
5.3 Organizational Structure and Design 36
5.4 Communication 37
5.5 Motivational Techniques Used 39
5.6 Controlling Authorities 39
5.7 Control Approaches Used 39
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6. Structure, Design and Issues 40

6.1 Divisions and Groups of its Units 40
6.2 Azgard9’s Business Include 40
6.3 Graphic Distribution of Azgard 40
6.4 Structural Dimensions 40
6.5 Contextual Dimensions 41
6.6 Decision Making 41
6.7 Conflicts and their Resolution 41
6.8 Power and Policies 41
7. Strategies & Analysis 42

7.1 Competitive Strategy 42
7.2 Marketing Strategy 42
7.3 SWOT Analysis 42
7.4 Financial Analysis 43
8. Core Internship Experience 44

8.1 Hierarchy of Marketing Department 44
8.2 Export Section 45
8.3 Export Order Execution 46
8.4 Procedure Inquiry 46
8.5 Production Mix 50
8.6 Local Sale Section 51
9. Conclusion 52
10. Recommendations 52
11. Bibliography 53
12. References 53
13. Glossary 54
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1. Executive Summary
This report consists of my six weeks internship at Azgard9 Limited which is situated
at Manga, Raiwind Road, near Lahore. Azgard is consistently focusing on improving
performance so that risks can be left far behind. Azgard is a responsible entity which
is highly committed to comply with the corporate, envoi mental laws and to conduct
their business with utmost honesty and sincerity. At Azgard it is believed that
development can only be achieved by equality and respect at work place. They have
been doing it for decades and there is no doubt they are reaping its benefits.
The Company’s management, combining innovative strategies, aggressive

marketing, creative synergy and visionary approach together with a lean
organizational structure capable of efficient response, succeeded in establishing
Azgard9 as the largest Denim Products Business in the country, with sales to the
tune of Rs.6,628,341,926.
Azgard9 has been benefited by the management’s highly responsive approach,

increasing its profits significantly since its acquisition from the Government of
Pakistan. 2008 posed to be challenging, primarily owing to the high raw material
prices, comparatively less productive workforce as compared to the major competing
countries, rising fuel prices resulting in higher domestic and International freight
costs, and probable rise in minimum wages, these factors are mitigated by Azgard9's
stronger business model within the Division and the Company.
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2. Industry Overview
2.1 Textile Industry
In 1947, at the time of independence Pakistan Textile Industry was like a

feeble child with only three cotton mills, a small woolen spinning, whereas weaving,
hosiery and knitwear were features of cottage industry. Now when we have entered
into new millennium, Pakistan’s Textile Industry has become a stalwart fellow, which
has grown in all sections. Now we are not only self-sufficient but are also exporting
surplus products. Today we have over 8358 million installed spindles, 166,000
installed rotors, 20,000 shuttle less looms, 200,000 power looms, 8,000 terry towel
looms, 7620 canvas looms, 157,000 woolen/worsted installed spindles, 15,000
woolen looms, 12,000 knitting machines, over 600 processing units and over 2500
garments units.
We all know, journey of textiles start from seed and culminates at ready-to-
wear garments and in present competitive world scenario, it is combination of high
production efficiencies, most appropriate technologies and work methods, together
with trained work force, management and marketing skills which give any Industry a
successful status.
Textile industry today is the backbone of economy of Pakistan and provides

the largest number i.e. about 40% of total industrial jobs and very vast industrial
service opportunities. It has always been the pillar of Pakistan’s economy
contributing substantially to Govt. revenues. It also has a dual linkage. As a major
consumer of domestic cotton, it provides a market for a leading cash crop and thus
has a critical influence on the growth and productivity in agrarian sector. Hence the
performance of the textile industry has a vital impact on the overall growth and
performance of the textile industry has a vital impact on the overall growth and
development of the economy. The industry also tops, as an earner of ever-so-scarce
foreign exchange and exported goods worth US $4.9 billion last year and this
amount is about 60% of the total national exports. Its share in total GDP is 8.5%. The
investment in Textile Industry is 31% of the total investment. The interest that banks
and other financial institutions earn from Textile sector is Rs. 4 billion per annum.
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The salaries and wages that Textile sector provides to workers is 40 billion
per annum. Its contribution to R & D is Rs. 116 million per annum. This very
remarkable achievement did not come easily and is due to combined and tireless
efforts of the Govt. planners, industrialists, technical support staff and our hard
working and inexpensive labor. On the top of these, Pakistan has been blessed with
suitable climate and perennial supply of good quality water to grow about 1.7 million
tons per annum of lint cotton, “the silver fiber” that forms a natural and sound base
for a viable textile industry. Pakistan textile industry consumed 1441 million Kg raw
cotton and 406 million Kg fiber during 1998 – 1999.
Value-added product exports of Pakistan Textile industry are very less. The
percentage of yarn exports in total textile exports in total textile exports in 20% and
percentage of cloth is 24% while 56% of total textile exports includes others textile
manufacturers. We should product more value-added products because if we see
the value addition chain the prices of cotton, yarn, cloth, garments, towels, bed wear
are US$ 1.33, US$ 2.33, US$ 5.41, US$ 6.71, US$ 4.05, US$ 5.51 per Kg
respectively. Thus we can earn additional foreign exchange by exporting value-
added products.
2.2 Spinning Industry
Areas comprising West and East Pakistan were big producers of good quality
cotton and jute fibrous raw materials but the value-added conversion industries were
mainly located around the Indian cities if Bombay and Calcutta in the respective
order. At the time of independence Pakistan was producing about one million bales
of cotton, which were exported and from the receipts, cloth and yarn for the
handlooms were imported. The Govt. took notice of this situation immediately and
encouraged setting up mills in both the wings of the country and in 1960 installed two
million spindles and 30,000 looms. In those days Govt. sanctioned only composite
mills with 25,000 spindles, 500 looms and a wet processing unit to finish the cloth
produced in mills. The balanced quality of yarn was required to be sold often through
an official channel to the weavers of handlooms and later to the power looms. The
mill owners made huge profits but their efforts for further investment were hindered
due to paucity of foreign exchange.
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This situation, however eased when the machinery manufacturers started

offering their plants under “the suppliers credit or pay as you earn” plans. This facility
brought is its wake escalation of prices of the textile machines and this started a new
development of installing only the spinning units of 12,500 spindles. Many of the
spinning units were then sanctioned on political consideration but went into the
hands of genuine entrepreneurs is no time. At the time Govt. tried to disperse the
industry away from the existing industrialized cities and new textile centers emerged
in small towns like Kotri, Sheikhupure etc. although these were quite close to the
existing centers in the big cities. By 1971, Pakistan had a substantial textile industry
with about 3.5 million spindles and 38,000 looms in the mills sector and exported
textile goods worth US$ 400 million.
After the separation of East wing, Pakistan was left with about 2.5 million
working spindles but growth was continuous and rapid and by 1985, the figure
reached 3 million. At that time the Govt. took a decision to convert all the home
growth cotton into yarn and for the first time, decided to waive the requirement of
getting official sanction for setting up a spinning mill. This decision opened the
floodgate and in just five years, the capacity increased to 5 million spindles. The
present working capacity is about 8,358 million spindles and 166,000 rotors. It may
be mentioned that about 1.724 million spindles are lying idle in 143 financially sick
mills which being of old technology have become redundant.
In 1998-1999, the spinning industry produced 1542 million Kg of yarn out of

which about 26% was blended yarn, 47% was coarse count yarn, 24% was medium
court yarn, 2% fine and 1% super fine yarn.
Development in the spinning sector is not in numbers alone but there is also
an improvement in average productivity. On the basis of 20/1 count productivity has
gone up from 190 grams in 1986-87 to 235 grams per shift per spindle in 1996-97.
Pakistan exported 508 tons that is about 33% of total cotton yarn produced in 1996-
97 and this makes her the largest exporters in the world with a share of about 28%.
This is not to be very proud of because of the yarn in a primary and not a value-
added commodity. Incidentally it has been estimated that about 70% of the total
cotton yarn is exported directly or after conversion into the value-added products.
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During 1998-1999 textile industry produced 1,542 million Kg of yarn, out of

which 54.94 million Kg (3.56%) was consumed in mill while 417.78 million Kg
(27.10%) was exported and 1,069.2 million Kg (69.34%) was available for local
market. The price of yarn (20/1) during 1998-1999 was Rs. 472.61 per bundle of 10
lbs.
Pakistan exports yarn to the following major countries: Hong Kong (25.38% of
total yarn export), Japan (19.72%), South Korea (8.90%), Asian countries (8.31%),
Dubai (3.72%), China (7.77%), and USA (4.81%).
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3. Introduction of Organization
We are a vertically specialized textile company. We manufacture virgin fibers

to retail ready products, which are marketed through our global sales and distribution
set up. Azgard9 Ltd is about a 100 million US $ company with sales offices in five (5)
countries. Our business includes Specialized Yarns, Denim Fabrics and Denim
Garments.
Azgard9 Limited
The Origins and the Inception
‘A place at the centre of the universe inhabited by the GODS’
Azgard is represented and embodied by the LOGO we have created; the oval
male form is representative of the universe and the void or female portion in the
centre, where ‘THE GODS RESIDE’. The universe is cradling the void as if to protect
as well as nurture it as it is contained in the centre of the ‘WOMB’ of the universe in a
fetal position.
In the ancient legend ‘AZGARD’ was one of nine worlds in NORSE

MYTHOLOGY- it was protected by ‘HEIMDALL’ the son of nine different mothers
each attributing him with a particular skill and power- and thus he would protect
Azgard from the powers that be.
The significance of nine for the members of Azgard
The significance of Nine for our company is not just based on this mythology
but also connected with the auspicious nature of this number throughout many
different elements in and of the world today that affect humans and their behavior.
The number ‘NINE’ is considered to be an auspicious and important number in
Indian, Chinese, Japanese, and Greek, cultures for various different reasons.
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In Chinese culture the number Nine represents ‘Change’ and

‘Transformation’, as is the case with Azgard Nine Limited, which is changing and
transforming itself into a global entity with new goals, aspirations, and targets.
Nine is much of Ancient Greek Mythology also has represented ‘Gestation’

and ‘Fulfillment of Creation’ as it does for us at Azgard Nine- The ‘Fulfillment of
Creation’ for us being the forming of this global entity incepted by Nine members on
the Ninth day of February sowing the seeds for an auspicious and rewarding future.
3.1 History of Azgard9
Azgard-9 Nine Limited is one of the oldest business groups on the Asian sub-
continent. It was started as a family business over four generations ago. The Sheikh
Family, now in the fourth generation, is one of the oldest business families in the Sub
Continent with experience in many different sectors. The family began its first
operations in 1886 as a first Ginning factory in Shamkot India.
After the formation of Pakistan in 1947, the group saw massive growth, whilst
consolidating its position in the market. At the end of this period the group employed
over 15000 people.
In 1972 the group became international by expanding to Ireland in the textile sector.
In 1978 the group established a presence in the United States by acquiring Burke
Mills Inc. in North Carolina. By 1980 this presence was also expanding and fortified
with the addition of another company Tennessee Textiles. The group was now
solidly focused on the textile sector. We set up AZGARD NINE LIMITED in 1994 as
a fully integrated vertical denim unit for fabrics and garments in collaboration with
LEGLER SPA. Of Italy.
In 1996 we expanded our American operations to Mexico where we set up a yarn

twisting operation as another joint venture between the NAFEES group and the
Alpha group, which is the largest industrial group in Mexico.
3.2 Company Vision
Our vision is to become a major global fashion Apparel Company
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3.3 Company Mission
“To retain a leadership position as the largest value added denim Products
Company in Pakistan”
3.4 Core Values
(a) Respect For All

(b) Integrity
(c) Hard Work
(d) Ethics
(a) Respect for All
 Does not discriminate on the basis of race, religion or ethnic

background
 Respect for Women
 Strongly prohibit all forms of harassments. For example racial, sexual
or any kind
 Attract, retain and develop outstanding people
(b) Integrity
 Honesty to self, colleagues and Azgard9

(c) Hard Work
 Company mission can be only achieved by hard work

 Honesty and hard work is appreciated and rewarded such as:
(i) Incentives upon achievement of target
(ii) Performance based incentives and promotions
(d) Ethics
 Professional behavior shall be entertained. e.g. gifts and favors will not
be accepted
 Personal beliefs of employee will be respected
 Responsibility and accountability
 Changes in Policies/Procedures shall be informed beforehand to the
concerned individuals
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 Work ethics:
 Attendance
 Teamwork
 Appearance
 Attitude
 Productivity
 Cooperation
 Respect
 Character
 Communication
3.5 Corporate Philosophy
Azgard9 is a centralized and formalized organization. It believes in teamwork.
3.6 Code of Business Principle
AZGARD 9 is an equal opportunity employer and safe guards the
 Rights of gender
 Religion
 Race
Encourage Employees on the basis of
 Education
 Experience
 Professionalism
The Company does not discriminate on the basis of
 Religion
 Race
 Ethnic Values
 Gender
 Cost
 Nationality
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3.7 Products
 Specialized Yarns
 Denim Fabrics
 Denim Garments
3.8 Services
 Construction of 2.5 Kms road leading from the main Multan Road to a
nearby village.
 Set up a Police Post in the adjacent village
 Cost sharing with Punjab Govt in arranging Annual Lahore Marathon
Race (All categories)
 To promote & set-up facilities for technical as well as general education
programs.
 To start community social development programs in areas of health,
education, civic facilities etc.
3.9 Name of the Department
 Marketing Department
3.10 Name of the Unit
 Garment Business Unit (GBU)
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3.11 Structure of Unit
This Departmental Flow Chart shows the structure of GBU
PRODUCT
DEVELOPMENT
PRODUCTION PLANNING CONTROL
MERCHANDISING
SAMPLING
CUTTING
STITCHING
WASHING
FINISHING & PAKING
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3.12 Culture
“The high speed passionate pursuit of progress through teamwork”; Azgard

believe in team work and all the departments follow the hierarchy levels of reporting
strictly.
3.13 Customers
 Montebello (Azgard9’s Italian Subsidiary through Fartital AB)

 JC Penney
 Levi’s
 Diesel
 Mango
 Yellow
 H&M
 Old Navy
 GAP
 ESPRIT
 Tommy Hilfiger
 Nike
 C&A
3.14 Markets
 Azgard9 have strong roots in the foreign market. The company is

providing very little of overall products and services to the local market.
 51% Direct Exports, 32% Indirect Exports &17% Local sales
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4. Introduction of Business Divisions
4.1 Spinning & Specialize Yarn
The department of specialized yarn started its production in 1972. And they
are yearly producing 67 million/ LBS per year. And the department of spinning
division started its production in 1995, its produce 400 bags per day.
The company focus is on producing fashion oriented yarns developed in close

cooperation with our customers and our raw material suppliers so that we can
provide products, which are already in demand in the market place.
The range includes both Greige cotton and dyed cotton yarns, blended yarns and
pure synthetic yarns we also offer organic cotton yarns for those customers who
demand it. We are cotton ASA certified and can provide certificates upon request.
Our open end yarns are used primarily in the denim sector. They lend themselves
perfectly for these applications and have achieved a very high degree of brand
loyalty in the markers in which they are sold. Technical data about machinery and
plant equipment and capacities is available in the “technical data” section.
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4.2 Spinning Process
Plucker
Steamer
Separator
Sensor
Carding
Laboratory
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4.3 Denim Fabric Division
The department of denim division started its production in 1995. And they are
yearly produce 14.4 million meters of fabric.
The primary focus and concentration of the denim division is to produce value
added fashion forward advanced denim fabrics which are in line with the marker
leaders located around the world. But at a proce point that truly offers the best buy to
our customers.
We are nominated to be the only supplier in Pakistan for some of the largest
and most prestigious customers from around the world.
Azgard-9 has state of the art manufacturing facilities employing rope dyeing and
air jet weaving technology. Our total capacity will be 26 million linear meters by
year’s end 2005.
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4.4 Denim Fabric Process Flow Chart
INPUT
SPINNING
BALL WRAPING
DYING
REBEAMING
WEAVING
FINISHING
FABRIC
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4.5 Garment Division
The department of garment division started its production in 1996. They are
fulfilling the initial minimum order quantity 7000 pieces. But, now the total production
of the garment division is per day 12000 pieces.
The garment operation is the newest addition to complement. The azgard-9

portfolio and thus completes the fully vertical aspirations and visions of the group.
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4.6 Garment Division Process Flow Chart
CAD
Cutting
Stitching
Washing
Finishing
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5. A Managerial View
5.1 Departmental Flow Chart of GBU
PRODUCT
DEVELOPMENT
PRODUCTION
PLANNING CONTROL
MERCHANDISING
SAMPLING
CUTTING
STITCHING
WASHING
FINISHING & PAKING
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5.2 Planning Process and Tools/ techniques
5.2.1 Product Development (PD)
First of all OCS (Order Confirmation sheet) is received from merchandiser,

which is attached with following details, which are as follows;
 Customer specification A/W sheet.

 Cutting details.
 Packing details.
 Approved trim cord B/W and A/W.
 Original sample which is valid for styling.
 Thread and washing details.
After receiving OCS the PD department send MS (merchandising sheet),

which is also known as work order sheet to MMC (Merchandiser Material Control)
department.
It is basically a procurement or purchase department. This department then

purchase and provide the material listed in the MS sheet.
The 2nd main function of PD department is to issue the Technical sheet which
is also known as production sheet. This Technical sheet describes every single
complication in the order.
Many Technical problems are solved and explained in this sheet. The
technical book contains the following contents:
 Style summery
 Stitching standards.
 Accessories standards.
 Packing standards.
 Customer specs MS.
This technical book is then distributed to all departments
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5.2.2 Product Development Flow Chart (PD)
Detailed Information Along

With Order Confirmation
Sheet
Thread Calculation,
Fabric Consumption,
Merchandising Sheet
NO
Verification Of
Merchandising Sheet
Forward Merchandising
Sheet to Concerned
Department
Technical Sheet
NO
Verification Of Technical
Sheet
Production Check Run

Activity
NO
Audit Of Production Check

Run
Final Verification of
Technical Sheet
Forward Technical Sheet to

All Concerned Department
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5.2.3 Production Planning Control (PPC)
The main function of PPC is to plan from booking to shipment and giving the
final dates to the marketing department for the completion of orders.
In this process the confirmation of order is first received from marketing

department with order number and desired date for completion. PPC department
receives availability report of goods and trims from the supply chain department. If
there is any shortage of fabric or before wash (B/W), after wash (A/W) accessories
then PPC demands estimated date for the availability of trims and fabric from MMS
(Main & fabric store) department for the procurement of goods .Then PPC
department make analysis of the capacity of the all operations in the company and
then give their possible date of completion to the merchandiser with the addition of
few days to the calculated completion date as a factor of safety.
If there is much difference between the desired date of merchandiser then

marketing department negotiate with customer and the date is then finalized .It is
PPC department which defines the targets for all the functioning departments on
daily basis also.
For this purpose a graphical chart is made which tells the starting and
completion time of stitching operation. This chart can be based on coming 2 months
or more depending upon the load of orders. The chart on next page shows it clearly.
The main functions of PPC are:
 Potential Planning
 Departmental Goals
 Time and Action Plan.
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5.2.4 PPC Flow Chart
Order Inquiry from MRC
Potential Analysis
(Unit Selection)
Deliverance Finalization
Order Allotment
Monthly Cut\Shipment
Induction Plan
Distribution Of
Orders in Lines
Plan Discussion
With Production
Distribute Of Plan
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5.2.5 Marketing Department
First of all, the Customer sends inquiry to the marketing department. There
are two ways regarding inquiry depends on the demand of the customer. i.e.
 With Garment
 Without Garment
After this, 1st sample or prototype is sent to customer for approval. If it is

rejected then 2nd prototype is made for approval of the order. If rejection continues,
then this process continues until the sample is approved. In case of approval of the
order, the customer tells its demand regarding order of SIZE SET or demand for
SMS (Sales Man Sample), its all depend on the customer requirements. It would be
delivered to customer for final approval of order. After approval of the order from the
customer, order confirmation is required from the marketing department. After this,
the customer sends purchase order to marketing department. The marketing
department sends the sales contract to the customer. Then the production starts.
After completing the target the finish garment ready for shipment. Before the
15 to 20 days of shipment payment should be received.
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5.2.6 Flow Chart of The Marketing Department
Customer
Inquiry
Without Garment With Garment
Sample 1st Sample

(prototype)
2nd Prototype
Reject Send Customer (for

approval)
SMS (Sales man Size Set (Sales man

OR
sample) sample)
After Approval
Order Confirmation
Purchase Order
Sales Contract
Performa Invoice
Production
Payment
Shipment
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5.2.7 Sampling Department
First of all the customer specification page is received in which sizes of

different parts are stated, with the help of these specifications the pattern master
makes the hard pattern of the different parts of the sample.
Then a sample called inquiry sample is sent to the customer in which some
developments are made. Customer can make changes in it by giving suggestions.
After making some modifications the customer sends the sample to sampling
department. Where another sample is made which meets the customer modifications
and suggestions. This sample is called ‘approved sample’.
A size set is then sent to the customer along with preproduction sample. The
customer select one specific size called base size out of that size set provided if he
passes the sample. This selected sample is called ‘sealed sample’.
After the approval of this sample it is sent to the marketing department and
then to Production Development (PD). Where Technical sheet is received. This
Technical sheet along with sample of fabric is sent for the Production Check Runner
(PCR) where shrinkage of swatches is measured. The values of shrinkage
allowances based on PCR are noted on shrinkage report and sent to the GGT,
where values of allowances are adjusted in the base pattern.
Then final marker is received for the purpose of cutting fabric for at least 6
pieces. Then fabric is cut according to the marker and ready to be stitched. Cuttings
are stitched and sample is created.
Before wash and after wash measurements are made in the sample. Change
in dimensions is noted on a report and that report is again sent to GGT. Where some
amendments are made in the drawing to overcome the shrinkages in bulk
production. The sample is sent to Quality department which send a quality report to
Quality manager.
There should be more pattern makers (trained) as the load to pattern master
ratio seems too much. Wastage of time can be controlled.
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5.2.8 Flow Chart of Sampling Department
Flow of Sub Departments
CAD (Computer Aided Design)
Cutting
Stitching
Washing
Finishing & Packing
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Flow of work
In CAD
Pattern through Customer Send

e-mail Sample
Digitizing
Converter
Marker Making
Send to Plotter
Out Put (Send to

cutting department)
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5.2.9 Cutting Process
In Put (From CAD)
3 manual Cutters
Stitching Department
Small Parts + Back Parts

Front Parts + Assembling
Washing Department
Finishing & Packing
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5.2.10 Flow Chart of Cutting Department
PPC MARKER
CHECKING
FABRIC AVALIABILITY
SPREADING
ORIGNAL SAMPLE CUTTING

TECHNICAL SHEET
NUMBERING
PCR CUTTING
STACKING
PCR MEASUREMENT/
WIP
CHECKING
AMENDMENT ON PCR
PATTERN NO
CHECKING
YES
MARKER MAKING
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5.2.11 Flow Chart of Stitching Department
Small Parts
Back Parts
Front Parts
Assembling
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5.2.12 In-Depth Look over the Flow of Work
Small Parts Back Parts
Panel Patch
Watch Pocket
NO.1 Attach
Pocket
Formation
Panel Patch
NO.2 Attach
Front Right
&Left Pocket
Attach
Panel Patch
NO.2 Attach
Back Pocket
Formation
Right & Left

Panel Attach
Front Fly
Dart Formation
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Front Parts Assembling
Panel Patch
In Sean
NO.1 Attach
Out Sean
Panel Patch
NO.2 Attach
Labeling
Panel Patch
NO.2 Attach
Waste Band
Right & Left

Panel Attach Hamming
Belt Loops
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5.2.13 Washing Flow Chart
WASHING
AFTER WASH QUALITY

CHECKING
WASH CHECKING
SAND BLAST CHECKING
DISPATCH TO FINISHING
34 | P a g e
5.2.14 Finishing & Packing
WIP
Accessories
Cutting &
trimming
Finishing
Press
Packing
35 | P a g e
5.3 Organizational Structure and Design
Organization Structure designates formal reporting relationships. It identifies

the grouping together of individuals into departments and of department into the total
organization. It includes the design of systems to ensure effective communication
and coordination across departments.
Organization Structure
Employees of AZGARD
NINE GROUP
Cl
,
ills
ea
sk
rD
ew
i re
CEO Shift In
,n
cti
charge
cy
on
Business U nit S enior

te n
-V
M anager S uperv isor

pe
alu
ge om
es
General Manager Supervisor

tar , c
,V
ts
ve ance
i si
Asst Supervisor
on
Manager
ac r form
, Mi
hie
ssi
Assistant Manager Skilled Workforce

Pe
on
,G
Management Trainee Un-skilled Workforce

oa
ls
Management Staff Non-Management Staff
Human Resources Depa rtment
36 | P a g e
5.4 Communication
In Azgard9, there is paper-less communication. Communication plays a vital role in

daily routine of Azgard9 culture. The means of communication used by the
management are: Office telephone extensions, E-mails, Notice boards.
How to get information regarding Office telephone extension?
There are two main sources from where information can be obtained regarding office
telephone extensions i.e. Consult the Telephone list in your department or Dial “0” to
talk to company operator for further details.
How to get direct dialing from operator for official works?
The direct dialing from operator for official work can be managed through dialing “0”
from the office extension. Please note that mostly we dial “0”; the operator will attend
your phone; provide your information regarding your name, department and office
extension; the operator will ask you to hold; operator will dial the number and direct
you to talk. The maximum period for one call is restricted to 5 minutes due to
pressure of calls on telephone lines / telephone exchange. Please show patience
when dialing the operator.
How to create E-mail account?
To create the E-mail account of an employee, the employee will communicate the
name, designation and department with the Information Technology (IT) department.
The employee has to fill the “User Account Creation Form” to activate the Login
name and E-mail address. E-mail shall be provided if recommended by Head of
Department (HOD), otherwise only Login name will be created for the employee.
Those employees who were recommended to get E-mail address shall submit the
“User Account Creation Form” to IT department and the System Administrator will
activate their E-mail address.
37 | P a g e
How to use Microsoft Outlook for E-mail?
Major applications:
1. Send / Receive E-mail
2. Address Book
3. Create Signature
4. Attachment of file
Consult Key book at IT department
Where IT department is located?
The IT department is located on the first floor near Managing Directors (MD) room.
 IT Support Services Extension no # 125, 225

 Extension no # to confirm the purchase of system: 325
Where main notice boards are located?
There are two main notice boards for administrative information located in the
garment passage hall. There are two directions to reach the notice boards. Firstly,
enter the garment gate, pass the IN/OUT machine, walk ten (10) meters and you will
find the notice board at your right hand wall. Secondly, enter the reception gate, pass
the reception, enter the tunnel passage and turn to your right or left at the end of the
tunnel passage. You will find the notice board pasted on the adjust walls.
However, there are departmental notice boards located in each department to paste
their information. The further departmental notice board information can be gathered
from the respective departments in detail.
What are the major information’ communicated by the means of Notice board?
The major information regarding Gazetted holidays, announcements, policies and

administrative matters are communicated through two major notice boards.
38 | P a g e
5.5 Motivational Techniques Used
Pay increment is being provided not on experience basis but on performance

basis. Also there are lists of benefits which are being provided to employees to
increase their productivity level.
Employee Benefits Highlights
• Foreign
• Incentive Scheme Training Trips • Residential
(On achieving tar gets) Colony
• Performance Based
• Provident Fund Annual Increments
Scheme
• Variable Pay
• Group Scheme
Insurance • Car Scheme
• Health • 32 leaves per

Insurance annum
• Pick and Drop • Company Loan

Facility Facility
• Company Paid • Recreational
Mobile Phone Subsidized Trips
Lunch Facility
Human Resources Depa rtment
5.6 Controlling Authorities
Managing Director (MD) and General Manager (GM) are the controlling
authorities over there.
5.7 Control Approaches Used
 Personal observation
 Statistical Reports
39 | P a g e
6. Structure, Design and Issues
6.1 Divisions and Groups of its businesses
 Specialized Yarns
 Denim Fabrics
 Denim Garments
6.2 Azgard Businesses Include
 Azgard 9 diversified into this sector by acquiring PAFL from

Government of Pakistan in 2006. The unit manufactures ammonia &
urea.
 Azgard Project Management &Engineering Solutions manages two
power Plants, which provide maintenance & support services.
6.3 Geographic Distribution of Azgard
 Garment business unit (Manga Site)

 Garment business unit (Ferozpur Road/ FPR)
 Spinning Unit (Multan)
 Pak American Fertilizers Limited (Mianwali)
6.4 Structural Dimensions
Formalization: “The act of making formal by stating formal rules and standards.”
Azgard9 is a formalized Organization. There are some set rules and standards which
every employee has to follow.
Specialization: Azgard9 is a composite unit and its specialization is Yarn.
40 | P a g e
Centralization: Its both FPR i.e. Ferozepur Road site and Manga site are
centralized except their production department.
6.5 Contextual Dimensions
Size: Azgard9 Ltd is about a 100 million US $ company with sales offices in five (5)
countries. Our business includes Specialized Yarns, Denim Fabrics and Denim
Garments.
Technology: AZGARD 9 has state of the art manufacturing facilities employing rope
dyeing and air jet weaving technologies. Our Total capacity will be 28 million linear
meters by year ending 2010.
External Environment: As Azgard9 deals with the foreign market only. So the
company strong competition with its foreign competitors.
6.6 Decision Making
GM and MD are involved in decision making. And also head of the departments take
part in formal decision making.
6.7 Conflicts and their Resolution
Being formalized organization, all the disputes and conflicts are sent to the next
higher authority in the hierarchy. And authority decides its resolution.
6.8 Power and Politics
Power is in hands of top management like higher authorities. There is no any

concept of employee empowerment. Politics exists everywhere in the company. No
employee can escape from that politics. Leg pulling is also there.
41 | P a g e
7. Strategies and Analysis
7.1 Competitive Strategy
 Better performance
 Providing value added products
 Providing on demand washing effects
 Adopted pull and push strategy
 Providing better products at lower rates
7.2 Marketing Strategy
 Firstly improving own product

 Better research & development
 Product innovation
 Reasonable price against market
 Smart and excellent outlook of garments
 Using price strategy for youngsters
7.3 SWOT Analysis
Strengths:
 Vertical Composite Unit
 Multinational Company dealing with worldwide big brands (e.g.: H&M,
Diesel)
 Unique washing and dying
 Two power supply units
Weaknesses:
 Health and safety Environment problems
 Manual cutting
42 | P a g e
Opportunities:
 Company is going to launch a new local brand in 2009
 TQM Implementation is one of its big opportunities.
Threats:
 Competitors ( CBL, US Denim)
 Political instability in Pakistan
7.4 Financial Analysis
The challenging trading conditions have a great impact however the

performance of Azgard9 shows a healthy growth trend. However the increase in
finance cost was greater than the growth in income which significantly affected the
bottom line. The rapid increase in the finance cost is basically due to the devaluation
of the Pak Rupee. Company had borrowings in foreign currencies either directly or
indirectly thus effecting the finance cost very badly.
Performance
 Equity of company is Rs. 10,317,920,684

 Production reached 5 million tons, approximately.
 Sales Rs. 10,113,499,351 which is 53% change as compared to last
year
 Profit after tax is Rs. 897,283,923 which is 17% change as compared
to last year
 Having total assets of Rs. 29,600,032,254
Goals
 Continue with its low pricing strategy

 Keeping sufficient margins
 Further enhancing the product and services portfolio
 Ensuring seamless business process interaction with the customers
 Create a highly integrated supply chain
 Enhanced customer loyalty and value creation
43 | P a g e
8. Core Internship Experience
Being a marketing internee, I was assigned a task related to marketing practices.

Here firstly I am going to discuss briefly whatever I learned over there regarding
other marketing practices.
Marketing department is the key department of the organization and half of

the success of the business depends upon the activities of this department because
this department has direct contact with the customers.
Marketing department deals with two types of markets
 International Market
 Local Market
8.1 Hierarchy of Marketing Department
Hierarchy structure if the marketing department is as follows:
44 | P a g e
8.2 Export Section
Azgard has local market as well as export market; therefore the major job of
all the marketing managers is defined. The major steps, which are involved in the
process, are as follows.
Broadly categorized there are two types of customers:
8.2.1 Direct Customers

Direct customers are those who directly import the yarn from Azgard. These
types of customers enjoy the low prices because of the fact that there is no
commission involved in that case. In this type of correspondence there is no
intermediary.
8.2.2 Agent Customers

In this aspect there are three possibilities
1) Pakistani agent is involved

First possibility occurs when a local agent has some direct customer in the
local country and that agent contact with Azgard. The commission paid to the
agent is added to the cost. The commission ranges from 2% to 3%.
2) Foreign agent is involved

Second possibility occurs when a foreign agent has some customers in his
country and that person is in direct contact with Azgard. The commission in
that case is also added to the cost. The limit of that commission ranges 2% to
3% according to the amount of the invoice. The percentage depends upon the
profit margin which is given by the customer.
3) Pakistani as well as foreign agent is involved

Third possibility occurs when a foreign agent has some customers and that
agent had no direct link with the company but with a local agent who have
direct link with the company. In this case the maximum commission for both
the agent is 4% which is distributed among them by mutual understanding.
45 | P a g e
8.3 Export Order Execution
Scope
This procedure is applicable for all sort of yarn being produced.
Purpose
 To maintain & increase the export with better quality goods and
services.
 To ensure that services fulfill the needs of customers
Responsibilities
C.O.O. To give price approval
Dept. In charge To make inquiry to relevant section and watch all related
activities
Section In charge To do costing and setting approval & follow up.
Senior/Junior Staff To send samples
To note dispatches orders
To maintain all records in Customers Dockets
8.4 Procedure Inquiry
First of all, customer send enquiry. He tells about his requirements that how many
quantity of yarn is required in what count and specification. In response the supplier
sends quotation to the customer and tells about the detail of his order. Suppliers see
whether he can meet his requirements or not. The negotiation is started between
seller and customer in which prices are settled, delivery date is decided and other
terms and conditions are discussed.
46 | P a g e
At the end a sales contract is signed from parties, seller and customer. In his sales
contract following things are mentioned.
Costing
Costing sheet is prepared for C.O.O approval. In absence of C.O.O

department in charge approves the price.
Costing Approval
CEO gives approval or may suggest any other price to be offered.
Contract Review and Issue
Section in charge takes following steps before issuing a contract:
1. Prepare contract review check sheet

2. The requirements are adequately defined and involvements of
production areas are specified.
3. In-house/Out-house, have the capacity to meet the order requirements.
In getting approval of costing and review of customers requirements prices

are quoted to the customer for confirmation.
Confirmation of Sale Contract
If customer confirms the price offered, sale contract is issued to the customer
with complete details of price, quality, delivery, payments terms etc.
Letter of Credit (L.C)
In this supplier’s bank and customer’s bank are involved. Therefore payment
is done through banks.
47 | P a g e
Procedure of Letter of Credit
1) LC Opening Bank
It is also called the bank of importing country.
2) LC Advising Bank
This bank provides LC to the suppliers. The supplier receives the LC
and starts the production.
3) Negotiating Bank
The supplier submits the required documents to this bank. Then this
bank provides the amount of LC to the supplier on certain terms and
conditions.
Elements of Letter of Credit
1. Name of issuing bank

2. Form of LC
3. Revocable of irrevocable
4. Date of issue
5. Buyer’s name
6. Supplier’s name
7. Currency code
8. Amount
9. Payment terms
10. Shipments
11. Loading
12. Transportation
Performa Invoice
After the negotiation on prices took place and both the parties agreed, then the
Performa invoice is formed in which all the conditions of LC and total quantity of
order and the total price of that order is mentioned. The invoice is faxed to the buyer
and after the confirmation and opening of LC production is started of that order.
48 | P a g e
Description
Count 20/1 carded 100% cotton
Quantity 660 cartons
Packing sea worthy standard
Shipment July 3, 2000
Price US $ xxx per kg
Amount US $ xxx
Payment payment by confirmed irrevocable LC
Commission 2% to foreign agent 1% to local agent
Production Memo
Production memo is a statement in which all types of instruction about the

production of the given order are written.
Dispatch of Goods/ Yarn
Packed yarn is dispatched to the customers. If the shipment is to be custom

cleared from Karachi, goods are sent to Karachi on trucks with all necessary records.
Dispatched goods are detail noted in relevant registers.
Shipment
If the goods are to be custom cleared at Multan fry port, these are sent to dry
port for clearance. Documents are sent to clearing agent same day or next day and
followed up to ensure that these goods are custom cleared without any unnecessary
delay. In case of dry port, original bill of loading and 4th copy of shipping bills are
collected from shipment departments. Concerned staff follows up dispatch of goods
with Karachi office port to ensure on time shipment.
49 | P a g e
Post shipment documents are received from Karachi office and after proper
recording, handed over to finance department for negotiation. Shipping details are
noted in relevant registers. If there is any delay in receiving payments, relevant
person sends telex/ fax to customer for timely payment. Order registers are updated
periodically.
MIS Reports
Balance order instructions reports are updated periodically. Balance order list
is updated fortnightly for their information. Sale comparison reports are updated in
computer networks on monthly basis, it comprises one month’s status of shipment,
invoice values, complaints and claims (if any).
Quota Restriction
There are some countries where the quota restriction is imposed by the
importing countries. This quota is fixed on the basis of past experience. In these
countries where there is no quota restriction you can export as much as you can.
This is distributed by export promotion bureau among different mills.
8.5 Production Mix
Product
Azgard9 produces high quality yarn. It exports in foreign markets, sells in local
markets and along with that uses a major portion of its yarn in its own garment
department. All products are produced according to the requirements of customer
orders.
Price
Pricing is an important factor in the marketing process for any company. The
price policy of the company should be in such a way that it should produce a
reasonable profit, for the company and should satisfy the customers.
50 | P a g e
Place
Azgard9 is using two types of distribution channels
1) Direct
Azgard Nine Limited Customer
2) Indirect
Azgard Nine Limited Middle Man (agent) Customer
Promotion
As the yarn is an industrial product, middle man (agent) plays a major role in
selling the yarn. However on the other hand the marketing department personally
contacts the customers and sells the product. Therefore personal selling is a major
promotional tool for Azgard’s marketing department.
8.6 Local Sale Section
Local sale section deals with the sale of yarn in local market. Therefore
manager local sales deal with the local parties for product selling.
Execution of Sales Process
For the sale in local market first they check industry rates and then they
began bargaining with the customers. The manager sets the rates with the parties
and terms and condition also by both the parties so in this way a contract is signed.
 Buyer Name
 Seller Name
 Product Specifications
 Price
 Delivery Time
 Place etc
51 | P a g e
Commission is also set by the company with agent if the agent is involved
here. Then order is given to the production unit confirming the date of destination
etc. So in this way local sale is done.
9. Conclusions
Being an HR internee in Azgard9, I would like to mention that Azgard9 provide us a

great opportunity to learn practical knowledge. Azgard9 is a well reputed and a big
garment company in the textile sector. I really enjoy a lot while doing work over
there. Supervisor and managers of the department help and guide me a lot. One
thing which I find missing over there i.e. strong communication between
departments. Politics exists everywhere.
10. Recommendations
 There is a need of strong communication within each department and

between the departments.
 Locate all the sub-departments of HR at same place. It will help to
increase coordination between departments.
 There should be separate uniform for workers of each department within a
specific business unit.
 Attendance procedure should be more appropriate. Finger prints should be
taken from the employees.
 Internees should be free to visit all departments.
 There should be proper equipment provided to employees and workers to
prevent noise pollution and dusty areas. The workers should be strictly
bound to use these equipments.
 Stipend should be given to internees.
 There should be separate equipment for Training room.
 There should be separate cafeteria for female employees.
 There should be proper mosque for employees.
52 | P a g e
11. Bibliography
 http://www.azgard9.com/html/financial-information.htm
 http://www.azgard9.com/html/Security-Analyst.htm
 http://www.azgard9.com/html/financial-
info/2008/Security%20Analys_g%20-%20Q1.pdf
 http://www.js.com/pakistan-financial-news-latest_75.asp
 http://www.pacra.com/
 http://www.brecorder.com.pk/index.php?currMIndex=16&currPageNo=1
12. References
 Saqib Hussain (Business Development Manager, Azgard9)

 Tahir Munir (Business Unit Manager, Azgard9)
 Shah Bano (Deputy Manager Marketing, Azgard9)
 Bilal Afzar (Business Manager, Moody International)
53 | P a g e
14. Glossary
A/W After Wash
Azgard9 Azgard Nine Limited
B/W Before Wash
CAD Computer Aided Design
CEO Chief Executive Officer
COO Chief Operating Officer
E-mail Electronic Mail
FPR Ferozpur Road Site
HOD Head of Department
IT Information Technology
LC Letter of Credit
MD Managing Director
MMC Merchandiser Material Control
MS Merchandising Sheet
OCS Order Confirmation Sheet
PAFL Pak American Fertilizers Limited
PCR Production Check Runner
PD Product Development
PPC Product Planning Control
R&D Research and Development
SMS Sales Man Sample
T&D Training & Development
WIP Work In Process
54 | P a g e

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2.5 Km off Manga, Raiwind Road, Pakistan

4. Introduction of Business Division 13

6. Structure, Design and Issues 40

7. Strategies & Analysis 42

8. Core Internship Experience 44

The Company’s management, combining innovative strategies, aggressive

Azgard9 has been benefited by the management’s highly responsive approach,

2.1 Textile Industry

In 1947, at the time of independence Pakistan Textile Industry was like a

Textile industry today is the backbone of economy of Pakistan and provides

2.2 Spinning Industry

This situation, however eased when the machinery manufacturers started

In 1998-1999, the spinning industry produced 1542 million Kg of yarn out of

During 1998-1999 textile industry produced 1,542 million Kg of yarn, out of

We are a vertically specialized textile company. We manufacture virgin fibers

The Origins and the Inception

‘A place at the centre of the universe inhabited by the GODS’

In the ancient legend ‘AZGARD’ was one of nine worlds in NORSE

The significance of nine for the members of Azgard

In Chinese culture the number Nine represents ‘Change’ and

Nine is much of Ancient Greek Mythology also has represented ‘Gestation’

3.1 History of Azgard9

In 1996 we expanded our American operations to Mexico where we set up a yarn

3.2 Company Vision

Our vision is to become a major global fashion Apparel Company

3.3 Company Mission

3.4 Core Values

(a) Respect For All

(a) Respect for All

 Does not discriminate on the basis of race, religion or ethnic

 Honesty to self, colleagues and Azgard9

 Company mission can be only achieved by hard work

3.5 Corporate Philosophy

Azgard9 is a centralized and formalized organization. It believes in teamwork.

3.6 Code of Business Principle

AZGARD 9 is an equal opportunity employer and safe guards the

3.9 Name of the Department

3.10 Name of the Unit

 Garment Business Unit (GBU)

3.11 Structure of Unit

This Departmental Flow Chart shows the structure of GBU

PRODUCTION PLANNING CONTROL

FINISHING & PAKING

“The high speed passionate pursuit of progress through teamwork”; Azgard

 Montebello (Azgard9’s Italian Subsidiary through Fartital AB)

 Azgard9 have strong roots in the foreign market. The company is

4. Introduction of Business Divisions

4.1 Spinning & Specialize Yarn

The company focus is on producing fashion oriented yarns developed in close

4.2 Spinning Process

4.3 Denim Fabric Division

4.4 Denim Fabric Process Flow Chart

4.5 Garment Division

The garment operation is the newest addition to complement. The azgard-9

4.6 Garment Division Process Flow Chart

5.1 Departmental Flow Chart of GBU

FINISHING & PAKING

5.2 Planning Process and Tools/ techniques

5.2.1 Product Development (PD)

First of all OCS (Order Confirmation sheet) is received from merchandiser,

 Customer specification A/W sheet.

After receiving OCS the PD department send MS (merchandising sheet),

It is basically a procurement or purchase department. This department then