New direction for a Sri Lankan apparel venture: chasing a capitalist or cooperative dream

Figures & data

Exhibit 1. Southern Garments Income Statement 2019–2020.

INCOME		LKR^1
	Sales	36,793,800
	Other Income	218,000
Total Income		37,011,800
EXPENSE
	Payroll	32,643,360
	Managing Director Withdrawal^2	1500,000
	Utilities	1354,800
	Material & Factory Overheads	1174,560
	Administration Expenses	845,400
	Bank Loan Repayments	528,000
Total Expenses		38,046,120
Net Income		−1034,320

¹ LKR (Sri Lankan Rupee): 1 USD = 184.2 LKR; 1 AUD = 131.6; 1 GBR = 240.9; 1 EUR = 218.6.

² Salary withdrawn by Nuwan Perera as Managing Director.

Exhibit 2. Present organization list of personnel.

Designation	Description	Number
Sample Room Operator	Elite sewing operators with 10+ years industry experience, capability in all types of apparel.	8
A Grade Operator	Operators with 3–5 years’ experience and high level of competency in a specific type of garment. Some were capable of sewing an entire shirt, others may specialize in knits.	42
B Grade Operator	Operators with 1–3 years’ experience with expertise in individual components. Unable to sew complete garments.	28
Trainee Operator	Operators with less than 1-year experience. Groomed to become B grade operators.	10
Button Sewing Operators	Specialized operators focusing on finishing of apparel. Carrying out buttonholing and attaching.	3
Helpers & Quality Control	Assist in all aspects of production. Production line helpers fed main sewing line by inputting cut pieces. Quality control helpers check for deviations and defects, remove excess thread. Finishing helpers iron and pack.	36
Cutter	Mark, layer and cut all fabric and lining for production.	2
Pattern Makers	Produce templates for components of various garments which are used for cutting and as a guide for sewing.	2
Merchandiser	Liaise with buyers and suppliers to ensure factory has all necessary raw material to carry out production.	1
Line Supervisor	Take responsibility for a single production line. One line supervisor may focus entirely on dress shirts, another on casual shirts, another on bottoms. Roles vary based on season.	3
Factory Manager	Responsible for overall running of the factory. Works with line supervisors and other key personnel to ensure factory meets its production and quality targets.	1
Mechanic	Responsible for machinery repair, maintenance and adjustments. The mechanic not only plays a key role in handling breakdowns but may need to adjust machineries based on type of garment or material.	1
Accountant	Responsible for administering payroll, income and expenditure.	1
Office Assistant	Responsible for all HR functions, attendance management, documentation of contracts, and general administration.	3
Driver	Responsible for logistics, transport of finished goods and supplies.	1
Cleaner	Responsible for maintenance and housekeeping of factory and office.	3
Security	Monitors employee entrances, shipping, receiving. Responsible for overall safety, enforcement of rules and regulations.	2

Exhibit 3. Typical Production Flow for Manufacturing of Dress Shirts¹.

Source: Author developed based on information provided by case subjects.

¹ This production flow entails all operations in manufacturing dress shirts. For subcontract operation, Southern Garments may only undertake selected activities in the flowchart.

Exhibit 4. Estimated production capacity and projected demand for export-based subcontract orders.

Component^1	Annual capacity^2	Average price per unit^3	Estimated annual revenue	Projected annual demand
Collar (including band)	1,622,016	0.14	219,191.35	50,000
Cuffs (pair)	2,433,024	0.08	197,272.20	50,000
Sleeve Placket (pair)	3,649,536	0.06	236,726.66	50,000
Front Placket	4,055,040	0.05	219,191.40	30,000
Pocket	4,055,040	0.02	109,595.70	10,000

¹ Only involved sewing of individual component, not assembling with main garment.

² Optimal capacity at full efficiency if only producing one style and type of component with an A Grade Operator. In practice, variation of sizes, style, colour, employee skill level, breakdowns and parallel production of multiple components leads to production at lower capacities.

³ All figures listed in US dollars. Average figure based on subcontract orders.