Anna Group in National and Global Textile Industry Essay Example

terms of capital costs. For instance, while China may have a lower labor cost, our superior capital resources give us the upper hand.

Indian Scenario: The Indian fabric industry has a rich tradition spanning over 5000 years and is poised to make history.

The fabric industry in India has a relatively complex structure. On one end, there are manual spinning, manual looms, and power looms. On the other end, there is a highly advanced and fast production process that requires significant capital investment. Between these two extremes, the industry produces a wide range of textiles, including interesting dress materials, floor coverings, and garments. The majority of Indian textiles are made from cotton, with 70% of the natural materials consumed being cotton. While the industrialization led by colonial rulers diminished the status of Indian fabrics as exporters, the regulations enforced by the World Trade Organization are expected to propel Indian fabrics into becoming global suppliers, second only to China. This transformation from colonial exporters to outsourcing hubs showcases the adaptability and resilience of the Indian fabric industry, which is now being recognized in international forums and global publications.

Embracing solutions for global challenges can bring significant benefits to entrepreneurs and corporate houses, while resistance may lead to marginalization. However, it is important to recognize the value of adopting universal technologies, economies of scale, and global manufacturing practices. In the past, textile imports from various countries were restricted by the Multi Fibre Agreement (MFA), with India receiving quotas of 2% and 3% in the American and European markets respectively. Nonetheless, a new agreement called the Agreement on Textile and Clothing (ATC) was signed in 1995 to gradually eliminate the MFA

and its quota system.

Emerging countries like India, with a significant textile industry, are able to benefit from this advantage. The Indian textile industry stands out as it not only grows its own raw materials - silk, cotton, jute, and wool - but also converts them into valuable products such as fabrics and clothing. To maintain a consistent supply and manage costs efficiently, businesses in the industry have established local power plants. One cost-saving method is substituting expensive fuel with more affordable alternatives like LNG instead of Naphtha.

The removal of reservations for small-scale units in the garment sector has also stimulated investment in the sector. Fabric manufacturers have established garment manufacturing units to meet the demands of the export market. However, the fragmented nature of the industry has made its supply chain unreliable. It takes India between 40 and 60 days to ship goods to the US, while it only takes China around 15 days due to its superior infrastructure.

In brief, the fabric industry in Kerala is not afraid of addressing external challenges or competition if a fair playing field is established and all fundamental issues are resolved. The challenges primarily originate from within and are centered around government policies, as the industry has already compared itself to global market leaders.

Fabric Industry in Kerala

The first cotton fabrics factory, called Malabar Spinning and Weaving Mill, was established in 1883 in Kallai near Kozhikkode by P.S Santhappa Chettiyar and M. Guptan Namboothiripad. Commercial production started in 1887. In 1976, the government of Kerala took over the factory and transferred it to the Kerala Province Fabrics Corporation.

The second factory, known as Parvathi Mills Ltd., was established in 1884 by

James Darragan, an adult male from England. The factory occupied 19 acres of land, graciously provided by the Maharaja of Travancore. In 1888, AT VIN, a British industrialist, purchased the factory. In 1932, the management of the factory was taken over by Kerala Textiles Corporation. In April 1974, the factory was nationalized under the Ill Fabrics Nationalisation Act and became a unit of National Textiles Corporation (NTC) Limited in Bangalore, a subsidiary of NTC Delhi.

Sitaram Textiles Ltd., founded in 1903 by Balarama Iyer, is among the oldest factories. However, mismanagement and labor problems led to the company's liquidation in 1954. Moreover, a fire in 1959 resulted in the complete destruction of the mill, causing production to come to a halt.

In 1972, the Government of Kerala acquired this unit through a settlement and public auction. As a result, the number of cotton fabric factories increased to 31. On March 29, 1994, the authorities announced their intention to establish 5 more spinning mills in Kazargode, Kozhikode, Thrissur, Kottayam, and Malapuram. They also planned to commission a co-operative spinning factory at Kareela Kulangara in Allepey with a spindle capacity of 6000 spindles. The cotton fabric industries are mainly concentrated in the territories of Thrissur and Palghat, followed by Ernakulam and Kannur. These four territories combined account for about three-fourths of the mills in Kerala. However, the number of existing composite mills is relatively low.

, merely four in figure, its growing during the last 10 old ages is nil.

Due to the unprofitable nature of composite factory, Malabar spinning and weaving factory discontinued its weaving operation and concentrated on whirling merely.

Calicut modern spinning factory one time turned ill is now

taken over by a financially sound 3rd party and found net incomes before the last, decennary.

There are 7 cotton fabric Millss in Trissur including one complex factory.

Kottayam stands last in the list with merely one province owned factory.

There are 16 private factories in Kerala, consisting of 14 whirl mills and 2 composite mills. The national fabric corporation owns 4 whirl mills and 1 composite factory. The cooperative sector owns only 2 whirl mills. The Trissur cooperative whirl mills in Kerala is the smallest factory with 12,000 spindles. Kathayee Cotton Mills Limited is the next smallest factory with 14,860 spindles. Additionally, Palghat saw the start of commercial production by Past Pin India Ltd., a 100% export-oriented unit.

The units at Palghat near Kerala- TamilNadu boundary line are where these factories are located. There is another factory, the Alleppey Co operative spinning factory at Kayamkulam, which produces carbon monoxide secret agents but it has not yet been put into operation. In Kerala, there are a total of 31 mills, with 14 being in the private sector, 8 under the National Textiles Corporation, 4 under the Co operative Sector, and 5 under K.S.T.C.

The Anna Group of Companies

Mr. started the Anna Group of Companies over 3 decades ago in 1968.

M.C.Jacob established the Anna Aluminium Company, breaking away from his affluent family of plantation owners to venture into the risky world of manufacturing industry. Despite the challenges, he worked diligently to ensure the success of his first business endeavor. Today, the group is involved in various industries such as aluminum sheet production, manufacturing utensils from aluminum, spices, textiles, clothing, and bags. The Anna range of

utensils is highly sought after in the domestic market and in international locations such as the Middle East, USA, Africa, and Australia. The overall turnover of the group exceeds 200 crore.

Sister CONCERNS

Anna Aluminium Company

Anna Aluminium is the main company within the Anna Group. For the past thirty years, they have specialized in manufacturing and selling utensils that meet ISI standards. Notably, they are currently the only company in Kerala with ISI Certification for utensils.

The company produces vases only using 99.5 % pure aluminum metal bars. The brand 'ANNA' has become a household name in Kerala because of its high standards of quality and craftsmanship. The Company offers over 525 different varieties of vases and utensils, distributed through more than 1200 retail stores in India.

Kitex limited

Anna Group's textile production unit, KITEX LIMITED, was founded in 1975.

The company specializes in producing cotton and blended cloth products such as grey fabric, bed sheets, and lungies. Over time, the company has become well-known in this highly competitive industry for its high-quality products. The Kitex brand, manufactured in large mills, is recognized not only in India but also internationally, catering to fashion-conscious markets worldwide. Kitex bed sheets are made from 100% combed cotton and are suitable for all climates, available in various shades and designs. Some of the key products offered by Kitex include:

• Dago Bert Shirting and Suiting.
• Agna and Adonis Inner Wear
• Scoobee Day Bags
• Trawellday Bags

Kitex garments limited is a separate 100% export-oriented unit dedicated to the manufacturing and exporting of readymade garments in accordance with export standards.

The merchandise available at Kitex Garments includes various types

of ready-made garments such as hosiers, woven shirts, polar fleece, jerseys, children's wear, nylon jackets, pants/T/C fleece, trunks, dark wear, and cotton innerwear, outwear, and knitted cotton wears. The highly equipped and flexible manufacturing system at Kitex Garments allows them to adapt effectively to the changing demands of the global fashion market. They are able to fulfill both customized customer specifications and standardized production. Additionally, every finished piece produced by Kitex reflects their commitment to delivering superior quality.

Kitex Community College

was established and is managed by the group since January-2003.

This college is affiliated with the Madras Centre for research and development of community education. It was primarily established to train unemployed individuals and provide them with job opportunities. The courses offered include bag making, utensil manufacturing, general English, apprenticeship and training, communication, etc.

Sara spices

SARA SPICES is the condiment manufacturing unit of the Anna Group. It is engaged in producing and exporting curry powders, whole spices, etc.

For the past two decades, Sara Spices have been captivating the palates of food connoisseurs worldwide with their delightful variety of Spices and Masala powders since its establishment in 1976.

Latest ventures: Recently, Anna Group has expanded into various sectors, including the production of instant food and durable goods.

The company Kitex Ltd has also established a fashion engineering institute to cater to the growing need for skilled individuals in the fashion industry.

OWNERSHIP PATTERN

Kitex Ltd was founded in 1975 and is a public limited company with all internal shares. The company is not listed on the stock market and was founded by Shri M.C. Jacob.

The company does not have any booster group. The responsibilities of a booster are performed by the Board of

Directors itself. Shri M.C. Jacob serves as the Chairman and Managing Director of the company. The other managers of the company include Mr.

Bobby M Jacob and Mrs. Mini Bobby.

COMPANY HISTORY

Anna Group 's weaving unit, KITEX LIMITED, was established in 1975. The Company is involved in the production of cloths made of Cotton and other blends, Grey Cloth, Bed sheets, and Lungies. Kitex produces cloths made of Cotton and other blends, Grey Cloth, Bed sheets, and Lungies. Kitex lungies come in four different types - Executive, Medium, Super medium, and Economy - each with a different price.

Kitex White offers a range of white dhotis, both single and double. They feature different colors and gold accents to enhance the look of your dhoti. The company also provides a variety of beautiful bedcovers called Sweet Dreams. Over time, Kitex White has established itself as a leader in this fiercely competitive industry by maintaining exceptional quality.

Kitex markets its merchandises through a network of over 2000 authorised traders. KITEX cloths are now exported to many parts of the universe. KITEX is embarking on a major expansion program to increase production capacity.

LEGAL FRAMEWORK OF THE ORGANIZATION

The legal framework of Kitex Limited encompasses the regulations and ordinances that govern the company. It includes the rules that all employees and employers must adhere to, ensuring the success of the organization.

A standing order has been issued to all members of the organization, prescribing the mode of execution for each member and providing a detailed study on individual rights. Employers cannot disregard an employee without following proper procedures within the legal framework

of the organization. The standing order also includes guidelines on employee performance and behavior.

OBJECTIVES OF THE COMPANY

• World Class Manufacturer
• Customer
• Leadership, Teamwork, and TEI
• Quality process and people
• Policy strategy

The company aims to be a world-class manufacturer, focusing on all-round business excellence through a Total Quality Management system. This includes committed leadership, effective teamwork, satisfied customers, and happy employees in an environmentally friendly organization.

Products

Kitex produces cotton and blended fabric, grey fabric, bed sheets, and Lungies. They have well-known brands like Scoobeeday bags, Travellday bags, Dago Bert shirtings and suitings, and Adonis and Agna.

COMPETITORS

From the selling section, we can gain an idea about their products, selling strategies, strengths and weaknesses, rivals, rival's strategy, attractiveness, weakness, etc. Major competitors include MCR, Angel, JANSON, VBC, KKB, and RAM RAJ.

• MCR
• Angel
• JANSON
• VBC
• KKB
• RAM RAJ

The rival's strategies involve advertising and promotion through movie stars, which is especially prominent in the case of MCR. MCR introduces a variety of 'KARAS' in the form of dhotis and also sells differently colored lungis in the market to attract customers. In the case of KITEX LIMITED, the profit margin is relatively low. The major issues with the competitor's products are poor color dyeing and low quality.

Compared to other merchandises, KITEX merchandises are cheaper, which is why most clients choose them. KITEX lungies have a good trade name image. The rivals

of lungies include Angel, Bombay Dyeing, Jansons, and KKB.

GROWTH PROFILE

Kitex Limited, a prominent player in the fabric industry, started its remarkable journey in 1975 at Kizhakkambalam, Aluva, and Ernakulam.

This esteemed company, which is part of the Anna-kitex group of companies, is well-known among industrial giants in our state. The company specializes in the production of cotton and blended cloths, as well as greige fabric, bed sheets, dhotis, mull and lungies. These products are distributed through a network of over 2000 authorized traders. Over the years, the company has gained a reputation in this highly competitive industry for its internationally recognized products. The company was established with the aim of creating an efficient industrial estate that would provide operational, financial, and marketing support to power loom owners and create job opportunities for the unemployed. Initially named Kizhakkambalam Textiles Limited, the company started with 400 power looms and later changed its name to Kitex Limited.

Kitex markets its merchandises through a web of over 2000 authorised traders. KITEX cloths are now exported to many parts of the universe. KITEX is traveling in for a major enlargement program to augment the production capacity.

FUTURE Plan

Weaving capacity is doubled from 500000 to 1000000 by adding 120 shuttle looms. Now the company is planning to import natural stuffs Dornier and Pecanor. Diversification of new merchandises is being added.

SWOT ANALYSIS

The primary objective of conducting a SWOT analysis is to provide a framework for evaluating the ability of a company to overcome obstacles and take advantage of opportunities in the changing environment. By considering both external factors and market conditions, the strengths and weaknesses of the company can be effectively

identified. SWOT analysis is an important tool for identifying strengths, weaknesses, opportunities, and threats.

Strength

• Kitex is one of the oldest fabric manufacturers in Kerala, operating since 1975. This longevity has contributed to their credibility and reputation.
• Kitex has an effective distribution channel with a network of over 2500 traders spanning Kerala, Karnataka, and TamilNadu. They also have direct stores in Kerala and Tamil Nadu.
• Kitex has received ISO 9001-2008 certification for their commitment to producing and delivering quality products. They are the leading manufacturer in South India for various types of fabrics made from different materials.
• According to company officials, Kitex holds the highest market share for lungies in Kerala, estimated to be around 68%.

The text highlights several reasons for the failure of a company. The reasons include high labor attrition, high rate of absenteeism, fluctuations in incentives with seasonal changes, underutilization of installed capacity, and a lack of modern weaving machines and quality checking machines.

There is a lack of fully automated and sophisticated weaving and quality checking machines available. However, there are opportunities and challenges to consider.

Opportunity:
- There is a high demand for cotton clothing, especially as more people prefer to utilize cotton outfits in response to an increase in temperature.
- India has a large cotton cultivation and holds a significant position in the fabric market, being the second largest cotton manufacturer after China. India produces 23.5 million bales of cotton annually.
- There is an increased chance for export opportunities due to globalization.

Menace:
- Changing fashion trends influence customer preferences, as even people in small towns now favor alternatives like Bermudas and trunks over traditional lungies.
- Government policies regarding the

textile industry are subject to frequent changes.
- The market is flooded with cheaper products, offering customers more affordable options.

Possible implications and challenges:
- Kitex, the mentioned company, has an effective distribution channel with over 2500 traders spread across Kerala, Karnataka, and Tamil Nadu. They also have direct stores in Kerala and Tamil Nadu.
- Due to a lack of skilled workers, labor turnover rates are high. When workers find better opportunities, they tend to leave their current jobs.The company does not fully utilize the installed capacity, with many machines in the factory remaining idle. Additionally, the company lacks modern weaving machines and quality checking machines, and does not have fully automated and sophisticated weaving and quality checking machines. Wage fluctuations occur due to seasonal changes, and the company often has to engage in overtime production during peak seasons to meet orders, resulting in wage fluctuations.

To address these issues, it is suggested that the administration should strive to retain their skilled workforce through various retention strategies suitable for the company. Increasing wages for workers in the production unit is also recommended to prevent them from leaving for better options. Continuous training and advancement programs should be provided for factory workers to encourage their optimal contribution. Furthermore, the company should invest in fully automated and sophisticated weaving and quality checking machines to improve product quality. Finally, necessary steps should be taken to achieve full utilization of the installed capacity.