1.1 Babylon Group is the leading garments
oriented group of company. This company is related export, Local market,
Merchandisers, Dying, buying, medical service etc .Now I discuses what is
company? Company means issued securities through an initial public offering and
which are traded on at least one stock exchange or over-the-counter market.
These companies must file documents and meet stringent reporting requirements
set out by the Securities and Exchange Commission, including the public
disclosure of financial statements.
Any company whose shares are available to the
public is a public company.
Usually, the securities of a publicly traded
company are owned by many investors while the shares of a privately
held company are owned by relatively few shareholders. A company with many
shareholders is not necessarily a publicly traded company. In the United
States, in some instances, companies with over 500 shareholders may be required
to report under the Securities Exchange Act of 1934; companies that report under
the 1934 Act are generally deemed public companies. The first company to issue
shares is thought to be the Dutch
East India Company in 1601.
In addition to being able to easily raise
capital, publicly traded companies may issue their securities as compensation
for those that provide services to the company, such as their directors,
officers, and employees.
In comparison, privately held companies may also
issue their securities as compensation for services, but the recipients of
those securities often have difficulty selling them on the open market.
Securities from a publicly traded company typically have an established fair
market value at any given time as determined by the price the security is sold
for on the stock exchange where the security is traded.
Privately held companies have several advantages
over publicly traded companies. A privately held company has no requirement to
publicly disclose much, if any financial information; such information could be
useful to competitors. For example, publicly traded companies in the United
States are required by the SEC to submit an annual Form 10-K
containing a comprehensive detail of a company's performance. Privately held
companies do not file form 10-Ks; they leak less information to competitors,
and they tend to be under less pressure to meet quarterly projections for sales
and profits.
1.2 Origin of the Report:
Babylon
Group of concerns saw her emergence in the horizon of Readymade Garments
Manufacturers in Bangladesh in the year 1986 through creation of a small sewing
unit called Babylon Group Ltd.Through hard toil and perseverance Babylon
managed to survive the difficult times in the early years. Amidst the constant
battle for existence Babylon nonetheless stuck with her originally adopted
principles of honesty, integrity, moral scruples and business ethics. And that
probably had helped Babylon ease gently through the perilous path toward
success and stability in the subsequent years.
Never
missing to realize the future challenges that lay ahead, Babylon always had put
all her efforts and means to master the best practices in all her manufacturing
units in order to achieve professional competence and reliability.
It has
been the policy since inception that Babylon would always offer more to her
customers than could be expected of her. To fulfill this commitment Babylon has
been acting not only as a trusted supplier of readymade garments but also as a
benevolent partner toward all her buyers and customers.
As a result- meeting the
extraordinary requirements of her customers has become a custom in this
business house and a matter of pride for the Group.
Quick
adoption of some of the other very important policies like getting accreditation
of ISO Quality Standard practices, ensuring total compliance of various Code of
Conduct requirements of prestigious buyers across the world, prioritizing the
need for creation of ideal work conditions for the workers and ensuring proper
health care & safety for them etc. has awarded Babylon a respectable
position in the top echelons of the RMG manufacturers in Bangladesh.
1.3
Objectives of the Report:
Primary Objective: - Primary objective of this
report is to use the theoretical concepts, gained in the classroom situations,
in analyzing real life scenarios. This is also a partial requirement of the job
sector.
Secondary Objective: - Beside the primary
objective there are some other objectives, which are equally important:
» To get
real life experience from the organization, which will help in the future job
field.
» Identify the marketing activities
of the organization and work with them. » To be acquainted with day-to-day operation of service of business sector.
» To
gather knowledge about the functions and transactions of different departments
of Group compliance of practice with theory.
» To make an evaluation of the business in terms of marketing strategy of product and strategy for over all export &
local business.1.4 Scope of the Study:
Babylon Garments Limited is one of the leading
Garments in Bangladesh. The scope of the study is very effective to this company.
The report focuses upon the organizational structure and the financial services
offered by BGL.
1.5 Methodology:
The report is Descriptive in nature. Data used in this report have been collected
from both primary and secondary sources.
Regarding the organizational part, information required was collected
within the organization from the different departments BGL.
The primary sources are as follows:1) Face to face conversation with the respective officer of the branch.
2) Exposure on different desk of BGL.
3) Relevant file study as provided by the officers concerned.
The Secondary sources of data and information are:
1) Annual Reports of BGL.
2) Periodicals published by this company.
3) Different Books, articles, compilations etc. regarding general banking functions, foreign exchange operations and credit policies.
1.6 Limitations:
For the organizational part, the annual report
was the main secondary source of information that was not enough to complete
the report and provide the reader a clear idea about the garments.
Since the employees of this company were very
busy, they could not provide me little time. Beside this I carried out such a
study for the first time, so inexperience is one of the main constraints of the
study.
CHAPTER: 2 AN OVERVIEW OF GARMENTS
SECTOR:2.1 History of Garments Industry Bangladesh:
The
history of the Readymade Garments Sector in Bangladesh is a fairly recent one.
Nonetheless it is a rich and varied tale. The recent struggle to realize
Workers' Rights adds an important episode to the story.
Below, we present a detailed
narration of the evolution of the RMG sector from its humble origins to the
present day.
The
shift from a rural, agrarian economy to an urban, industrial economy is
integral to the process of economic development (Kaldor, 1966, 1967). Although
policymakers in the least developed countries (LDCs) have, at various times,
attempted to make agriculture the primary engine of economic growth and
employment generation, this approach has not worked, not least because of the
contributions of the Green Revolution, which has had the dual effect of
increasing agricultural productivity in the LDCs and displacing the rural
labour force at the same time. Led by the example of the East Asian economies,
most LDCs now accept the need for greater industrialization as the fastest path
to economic growth. In particular, countries such as Japan, Taiwan and South
Korea have demonstrated that an export-oriented industrial strategy can not
only raise per capita income and living standards in a relatively short time;
it can also play a vital role in modernizing the economy and integrating it
with the global economic system.
Bangladesh, one of the archetypal LDCs, has also been following the same route for the last 25 years. Once derided as a “basket-case” by Henry Kissinger (The Economist, 1996), the country stumbled across an economic opportunity in the late 1970s. New rules had come to govern the international trade in textiles and apparel, allowing low-cost suppliers to gain a foothold in American and European markets. Assisted by foreign partners, and largely unaided by the government, entrepreneurs seized the opportunity and exploited it to the fullest. Over a period of 25 years, the garments export sector has grown into a $6 billion industry that employs over a million people. In the process, it has boosted the overall economic growth of the country and raised the viability of other export-oriented sectors.
This essay analyzes the processes by which global trading rules came to help out a poor country like Bangladesh. It demonstrates the impact of the rule changes on the garments sector, and the response of the sector to multiple challenges and obstacles. It also discusses what steps Bangladesh should take in order to deal with the full liberalization of the international garments trade, which occurred in January 2005 and which could potentially threaten the country’s growth prospects. Finally, it details some of the recent developments that have occurred since liberalization took effect.
2.2 OVERVIEW OF THE BANGLADESHI ECONOMY
Bangladesh
is a tropical country in South Asia that is situated in the delta of two major
rivers that flow down from the Himalayas (the Ganges and the Jamuna). The
country’s land surface is therefore largely composed of alluvial silt,
rendering the soil highly fertile. Historically, this has made Bangladesh an
agricultural nation; although agriculture contributes only about a fifth of the
national GDP, it employs three-fifths of the labour force (ADB,2005).
Bangladesh
has an estimated population of 140 million (circa 2005), living in an area of
about 55,000 square miles. It thus has the unwanted distinction of being the
world’s most densely populated country, and this overpopulation is at the root
of many of Bangladesh’s socioeconomic problems. However, the population is
largely homogeneous in terms of ethnicity, language, and religion, and this
provides a valuable element of national cohesion.
In spite of numerous constraints, the economy has been on a steady growth path for the last 15 years, mainly due to private sector dynamism. The constraints include pervasive political instability and violence, endemic corruption and disregard for the law, frequent natural disasters, inefficient state-owned enterprises that are hotbeds of trade unionism, lack of political will to carry through necessary economic reform, inadequate infrastructure at all levels (power generation, roads and highways, port facilities), etc.
In spite of numerous constraints, the economy has been on a steady growth path for the last 15 years, mainly due to private sector dynamism. The constraints include pervasive political instability and violence, endemic corruption and disregard for the law, frequent natural disasters, inefficient state-owned enterprises that are hotbeds of trade unionism, lack of political will to carry through necessary economic reform, inadequate infrastructure at all levels (power generation, roads and highways, port facilities), etc.
The
table below lists some key macroeconomic indicators for the period 2004-2006:
Sectorally, services constitute the largest portion of GDP with 51.7%. Industry accounts for 27.1% and agriculture 21.2%. However, the distribution of the labour force is reversed, with most people still working in agriculture (61%), followed by services (27%) and finally industry (12%). This imbalance between output and employment is indicative of a large amount of “disguised” unemployment and underemployment. Unemployment (including underemployment) is estimated to be about 40%. The poverty rate, as of 2004, is about 45%.
As shown by the above table, merchandise exports have been growing strongly in recent years and this trend is set to continue. While imports also exhibit strong growth, it should be noted that the bulk of imports consists of inputs into the production process, e.g. machinery and equipment, fuel and petroleum products, chemicals, iron and steel, cement, fabric and accessories (for garments production), etc. The breakdown of various exports by sector is given in the table overleaf (Bangladesh Bank, 2005). The figures are for the 2003-2004 fiscal year.
Sectorally, services constitute the largest portion of GDP with 51.7%. Industry accounts for 27.1% and agriculture 21.2%. However, the distribution of the labour force is reversed, with most people still working in agriculture (61%), followed by services (27%) and finally industry (12%). This imbalance between output and employment is indicative of a large amount of “disguised” unemployment and underemployment. Unemployment (including underemployment) is estimated to be about 40%. The poverty rate, as of 2004, is about 45%.
As shown by the above table, merchandise exports have been growing strongly in recent years and this trend is set to continue. While imports also exhibit strong growth, it should be noted that the bulk of imports consists of inputs into the production process, e.g. machinery and equipment, fuel and petroleum products, chemicals, iron and steel, cement, fabric and accessories (for garments production), etc. The breakdown of various exports by sector is given in the table overleaf (Bangladesh Bank, 2005). The figures are for the 2003-2004 fiscal year.
As can
be seen from Table 2, garments and textile items are the dominant export
product, accounting for 77% of the country’s total export receipts. This is a
relatively new phenomenon. For centuries, the chief export of the Bengal
economy was jute, a natural fibre which is used in making carpets, sacks and
hessian, but whose economic value went into precipitous decline after the
advent of plastic bags and synthetic packaging material in the 1960s and 1970s.
How the garments sector claimed the position of top export earner in the years.
Ethical Trading Practice:
Ethical principles apply to all facilities of
Babylon Group that produce readymade garments for exporting to foreign
countries.Babylon Group recognizes that there are legal and cultural
environments in which factories operate. These ethical principles set forth the
basic requirements of Babylon factories in order to do business with its
customers abroad.Babylon makes ceaseless effort to promote best practices and
continuous improvement of ethical issues in all its manufacturing units. For
easy access to the issues, Babylon posted contents in the Notice Boards of
factories in both Bangla and English.
The issues are:
Principle
1 – Laws & Regulation: Babylon facilities operate in full
compliance with the laws and regulations of the jurisdictions in which they
manufacture.
Principle
2 – Employment Age: Workers may not be younger than 18 years of age.
Principle
3 – Forced Labor: Babylon facilities do not use involuntary or
forced labor – indentured, bonded or otherwise.
Principle
4 – Wage and Benefits: Babylon facilities compensate their employees
fairly by providing compensation packages comprising wages and benefits that,
at the very least, comply with legally mandated minimum standards. Each
employee is provided with a clear, written accounting for each pay period.
Employees are compensated for overtime according to local law.
Principle
5 – Hours of Work: Babylon facilities ensure employees’ hours worked
shall not, on a regularly scheduled basis, exceed the legal limitations on
regular and overtime hours in the jurisdiction in which they manufacture or 60
hours per week including overtime. Except in extraordinary business
circumstances, all employees are entitled to one day off in every seven-day
period.
Principle
6 – Health and Safety: Babylon facilities provide their employees
with a clean, safe and healthy work environment, designed to prevent accidents
and injury to health arising out of or occurring during the course of work. All
Babylon facilities comply with all applicable, legally mandated standards for
workplace health and safety. All the workers and staff enjoy free medical
treatment. Company doctors are available full time.
Principle
7 – Discrimination: Babylon respects cultural differences,
employment – including hiring, remuneration, benefits, advancement, termination
and retirement based on ability and not on belief or any other personal
characteristics. Babylon facilities do not discriminate on the basis of race,
age, colour, national origin, gender, religion, sexual orientation, disability
or similar factors.
Principle
8 – Harassment: Babylon facilities treat all employees with respect
and dignity. Babylon facilities do not subject employees to corporal
punishment, physical, sexual, psychological or verbal harassment or abuse.
Principle
9 – Woman’s Rights: Babylon facilities ensure women workers receive
equal treatment in all aspects of their employment. Pregnancy test is not a
condition of employment, and pregnancy testing – to the extent provided by
Babylon facilities – will be at the option of the worker. Employees are not
exposed to hazards that may endanger their reproductive health, and employees
are not forced to use contraception. Fully equipped CRECHES are available for
the female workers having babies.
Principle
10 – Monitoring and Compliance: Babylon facilities maintain on site
all documentation necessary to demonstrate compliance with Global Compliance
Principles. Babylon and its subsidiaries undertake affirmative measures, such
as announced and unannounced on-site inspections of production facilities, to
monitor compliance with Global Compliance Principles. Babylon facilities allow
customer’s representatives full access to production facilities, employee
records and employees for confidential interviews in connection with monitoring
visits. In addition Babylon facilities respond promptly to reasonable inquiries
by customer representatives concerning the subjects addressed in an audit.
3.1My work Place:
As a Jr. Officer of BGL I have worked Babylon
outfit ltd. Babylon outfit ltd is the sister company of Babylon Group. Babylon Group of concerns saw her
emergence in the horizon of Readymade Garments Manufacturers in Bangladesh in
the year 1986 through creation of a small sewing unit called Babylon Garments
Ltd.
Through
hard toil and perseverance Babylon managed to survive the difficult times in
the early years. Amidst the constant battle for existence Babylon nonetheless
stuck with her originally adopted principles of honesty, integrity, moral
scruples and business ethics. And that probably had helped Babylon ease gently
through the perilous path toward success and stability in the subsequent years.
Never
missing to realize the future challenges that lay ahead, Babylon always had put
all her efforts and means to master the best practices in all her manufacturing
units in order to achieve professional competence and reliability.
It has
been the policy since inception that Babylon would always offer more to her
customers than could be expected of her. To fulfill this commitment Babylon has
been acting not only as a trusted supplier of readymade garments but also as a
benevolent partner toward all her buyers and customers.
Babylon outfit ltd Produce their product in local market. There are some
product that produce Babylon
outfit ltd. Those are given bellow-
As a
result- meeting the extraordinary requirements of her customers has become a
custom in this business house and a matter of pride for the Group.
Quick
adoption of some of the other very important policies like getting
accreditation of ISO Quality Standard practices, ensuring total compliance of
various Code of Conduct requirements of prestigious buyers across the world,
prioritizing the need for creation of ideal work conditions for the workers and
ensuring proper health care & safety for them etc. has awarded Babylon a
respectable position in the top echelons of the RMG manufacturers in
Bangladesh.
xpense that are related to production. When
completed the cost sheet than fixing sealing price.
3.3.4 Inventory analysis:Inventory is assets of company. Inventory also three types. Such as
·
Raw materials Inventory.
·
Working process Inventory.
·
Finished goods Inventory.
Raw
materials Inventory: Raw materials Inventory means Fabric, Accessories. As
a RMG company fabric stock is large amount.
Working
process Inventory: Working process inventory means those materials are use
Cutting, swing, and finishing.
Finished
goods Inventory: Finished goods Inventory means when the production are
complied.
Inventory is good for an organization but if the
inventory amount are large than the organization supper shortage of liquid of
currencies. If the inventory are short than when the company need in this the
company can not produce or delivered product. So the inventory level must be
keep easily sales or used. So to calculate the inventory is very essential things.
3.3.5 To maintain Bank Book:
To maintain bank book is very important factor of
account department. If we do not maintain that we do know our bank balance .If
do not know bank balance than if payment party by cheque the cheque must be
dishonor. It is very bad for any organization.
Suppose in 1 August 1, 2010 the company opening
balance TK. 500000, Deposit TK.500000, Deposit TK.500000, Party Payment
TK.200000, Party payment TK.50000, Party payment TK. 1000000. In 2 August, 2010
the company deposited TK.1000000, deposited TK.800000, Party payment TK.700000,
party payment TK.1100000. If we need money than I fellow the bank book if the
amount have sufficient than payment otherwise not I maintain this bank book in
excel Sheet. Now I given bellow-
SWOT analysis two factors act as prime movers
Internal factors which are prevailing inside the
concern which include Strength and Weakness.
On the other hand another factor is external factors which act as
opportunity and threat.Strength:
Competitive Salary: Babylon outfit ltd provides
satisfactory salary to their employees. This is the reason why the switching
rate is very low among the employees of Babylon outfit ltd.
Babylon
outfit ltd has 8 branches throughout the country. At present Babylon outfit ltd operating some new Branch
in Different place.
Strong Financial Position: Babylon outfit ltd is a
sound company backed by the enormous resource base of the mother concern
Babylon Group. As a result customers feel comfortable in dealing with the
company.
Good customer relationship: Babylon outfit ltd
has good relation with their customers. They give service to their regular
customers after 8 PM, though the branch is closed after 8 PM.
Efficient
management: All the levels of the management of Babylon outfit ltd ,are solely directed to maintain a culture of the betterment of the
quality of the service and development of a corporate brand image in the market
through organization wide term approach and open communication system
Weakness:
Limited
workforce: Babylon outfit ltd human
resources compared to its financial activities. There are not many people to
perform most of the tasks.
Reluctance to advertisement campaign: Babylon outfit ltd is avoiding the
marketing campaign for their new services. This is why the customers do not
know about them fully what they are offering.Lack of modern technology: Babylon outfit ltd is in the backward position because they are not adapting modern technology. They do not yet adapt online services towards their customers while most of the local competitor are giving services through online. Since they have lacking of pc based services, officers have to make manual vouchers which take hours after hours.
Opportunities:
Huge business area: Babylon outfit ltd has large
scope of RMG operation throughout the country and it is widening day by day. Babylon
outfit ltd is still to cover huge business area including on line sector.
Threats:
Political unrest: the country faces lot of
unrests and turmoil in the recent times, so the RMG operation is in the trouble
position.
Emergence of competitors:
Due to high
customer demand, more and more financial RMG are being introduced in the
country. There are already various types are operating in the country. The
market for Garments industries is now a buyer dominated market. Unless RMG can
come up with attractive financial products in the market .it will have to face
steep competition in the days to come.
Poor telecommunication infrastructure:
As
previously mentioned world is advancing e-technology very rapidly. Through has taken effort to join the stream of
information technology, it is not possible to complete the mission due to poor
technology and infrastructure of our country.
Merger and
acquisition: The worldwide trend of merging & acquisition in financial
institution is causing concentration. The industry and competitors are
increasing in power their respective areas.
Future Prospect
of Babylon outfit Ltd: The world economy is trying to recover from the trauma
of the 9/11 Twin tower attack in 2001. In such situation economic condition of
the country does not seem very bright and will take some time for recovery.
Moreover with the opening of the branch of newly opened private bank and
foreign banks, the competition will be intensified. The bank will go for
immediate automation of all branches through computer network and a tight
control of cost so as to minimize the overall operational cost. The Babylon
outfit Ltd will hope to achieve a satisfactory level of progress in all areas
of its operation.
CHAPTE: 5 Findings &Recommendations5.1 Limitation of Babylon outfit Ltd:
Babylon
outfit Ltd has no online system. This is quit insufficient. Still there
is some key business area like Chittogong branches are not in the online
network.
Existing software is not up to the mark. Software
is not that much user friendly as it should be and they do not have backup
online system. As a result if the line creates problem whole system goes down,
this causes more customer dissatisfaction rather than desired level of
satisfaction.
Babylon
outfit Ltd has their marketing department but they do not perform
according to the growth or reputation of the company. Still there is some major
problem in promotional activities and coverage of the bank. They do not have extensive
advertisement for their product or overall RMG business.
Lack of investment in new and
potential market.
Babylon outfit
Ltd still have some confusing branch coverage strategy, like Chittagong division
includes Cox’s Bazar and Noakhali. Both of them are big areas.
Babylon
outfit Ltd does not have any specialized service marketing strategy.
Since RMG sector is highly service-oriented organization, they should research
on service marketing and trained their employee.
5.2 Recommendations:
After a complete analysis and implementation of
the Babylon outfit Ltd performance
appraisal some facts and recommendations can be taken into account for a
relatively meaning full and precise application of the Babylon outfit Ltd performance development.
Market Study:
It is
matter of fact that we have no industry average to compare with in most case;
the concept of market study prior to lending should be introduced for Babylon outfit Ltd. Trade association
need to be motivated that Babylon outfit
Ltd becomes conscious to maintain industry related data.
Improvement of Accounting System:
It is necessary for the Babylon outfit Ltd to encourage business firms to keep financial
records as per prevailing standard of accounting. All the Garments and RMG
should take a coordinated effort to persuade the government to take initiative
to improve the standard of professional services provided by the Chartered
Accountants in our country. However, the Babylon
outfit Ltd should improve its internal accounting system in which they
maintain their all over the transaction.
Pricing Methodology:
New pricing methodology should be in the Babylon outfit Ltd strictly implemented
after analyzing the overall risk category through credit manual that interest
rate being charged reflects risk.
Borrower’s Awareness:Measures should be taken for the Babylon outfit Ltd to create awareness among the borrowers regarding the importance of credit facilities.
Field Study Based on Credit System
Credit Department of the Babylon outfit Ltd and fashion house should conduct real field
more elaborately to analyze the credit risk before final decision is taken and
market study for lending should gradually be introduced.
Make investment small and cottage
industryThe Babylon outfit Ltd can encourage investment in small and cottage industry in rural area. In this sector city bank can be play an important role in our country.
On-line Business:
The Babylon
outfit Ltd might take to go for on-line banking system. So far some
foreign and private fashion house is providing. Among the RMG the Babylon outfit Ltd might take the step
to introduce on-line business to its client.
Proper Training:
More training program need to be arranged for the
bankers of the Babylon outfit Ltd
so that they can improve their analytical ability and professional regarding
the use of credit mechanism and other tools and techniques in selection
borrower. Assessing the security value should also be done in the Babylon outfit Ltd by experienced
assessing, so that exact value of security can be reflected.
5.3 Conclusion
Babylon
outfit Ltd has started their journey as a full-fledged RMG in 2006. They
have already passed fourteen long years of their banking life. This bank
constantly looks for ways & means to improve productivity by rendering to
its customers in order to remain competitive in the market.
Babylon
outfit Ltd plays a significant role in various fields in the economy
such as industry, trade & commerce, transportation, deposit mobilization
etc. It is playing a crucial role in human resource development and in creating
new employment opportunities.
Babylon
outfit Ltd has to change their marketing strategy according to market
situation. They have to increase their branch network so that they can reach
their potential customer. Technology is one of the most important aspects of
banking sector. Babylon outfit Ltd
should expand their online banking service at least for key business areas.
This would give Babylon outfit Ltd
huge competitive edge over their competitors & customers will be more
satisfied with their service.
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