SUMMER TRAINING REPORT

ON
EXPORT PROCEDURE AND DOCUMENTATION
SUBMITTED IN PARTIAL FULFILLMENT FOR THE
AWARD OF THE DEGREE OF
BACHELOR OF BUSINESS ADMINISTRATION

SUBMITTED BY:.
PARV SADH
BBA(G) V SEMESTER
ROLL N0- 7614901714

2014 2017

MAHARAJA SURAJMAL INSTITUTE

C-4 JANAKPURI, NEW DELHI-110058
(AFFILIATED TO GGSIPU)
(RECOGNIZED BY UGC U/S2(F)

CERTIFICATE

ACKNOWLEDGEMENT

This project work, which is my first step in professionalism, has been successfully
accomplished only because of timely support of my well wishers. I would like to
pay my sincere regards to those, who directed me at every step in my project
work.
First of all I would like to express my thanks to Prof. Dr. R.K Tyagi
(Director, Maharaja Surajmal Institute) for giving me such a wonderful
opportunity to widen the horizons of my knowledge.
I extend my thanks to my project guide MRS. SHAVITA DESHWAL for her
scholarly guidance, constant supervision and encouragement. It is due to her
personal interest and initiative.
Last but not the least, I would like to thanks friends and parents who have
directly or indirectly contributed in making this project a success, it is tribute for
their valuation.
Despite of all efforts I have no doubt that error and obscurities remain that seen to
afflict a working project for which I am capable.

_____________________
PARV SADH
ROLL NO. 07614901714
BBA(G) V SEMESTER

TABLE OF CONTENTS
TOPIC
Chapter 1: Introduction
Objectives of the study

Research Methodology
Limitations of the study
Chapter 2: Company Profile
Chapter 3: Data Analysis and Interpretation
Chapter 4: Conclusion & Recommendations

Bibliography

PAGE NO.

Chapter 1
Introduction

Executive Summary

 The project is aim at understanding export procedure and

documentation. It begins with the introduction of the company i.e.
company profile. This part includes introduction of the company ,
its plant location , client base and some more information .
Next chapter discuss the methodology used for the data collection .
Exploratory research is used for data collection as it is best suited
for fulfilling the project objective .
Next chapter provides the detail on the objective , apparel business
process. It is explained through the T angle apparel supply
chain .
Next objective discusses a view of different department working in
synchronisation in order to process an export order. The role of
each department is discussed in context of export procedure and
documentation and what contribution they make towards it .
Next objective gives a brief idea on the merchandiser and what role
thet play . They are the ones who interact with the clients and
update the company with the clients requirements . They acts as a
liaison between the company and the clients .
In the final objective a brief summary of all the export documents
used at Aman Fashions for legalising an export order is given .
Further the documents regarding pre and post shipment procedure
are discussed .

OBJECTIVE OF THE STUDY

1)

To understand the apparel business process .

2)

To understand the working of various departments contributing

towards processing of an export order.

3)

To understand the role of merchandisers in Aman Fashions .

4)

To study the export procedure and documentation in Aman

Fashions.

RESEARCH METHODOLOGY
Research methodology is considered as a nerve of the project. Without a
proper well- organised research plan, it is impossible to complete the
project and to reach any conclusion. The main objective of survey was to
collect appropriate data, which work as base for drawing conclusion and
getting results. Therefore, research methodology is the way to
systematically solve the research problem. Research methodology not
only talks of the methods but also logic behind the methods used in the
context of a research study and it explains why a particular method has
been used in the preference of the other.
Research Methodology are the procedures used in making systematic
observations or otherwise obtaining data, evidence, or information as
part of a research project or study. Research methodology typically
involves a full breakdown of all the options that have been chosen by a
company in order to investigate something. This would include the
procedures and techniques used to perform the research; as well as any
of the terminology and explanations of how these methods will be
applied effectively
However, research methodology is not always pin-point specific. Many
areas of research methodology may simply be referring to a generic path
or method that a company will apply in order to retrieve the information
they need.
Research methodology is the way in which researchers specify how they
are going to retrieve the all-important data and information that
companies will need to make vital decisions.
Research methodology is a systematic way, which consists of series of
action steps, necessary to effectively carry out research and the desired
sequencing to these steps. The marketing research is a process which
involves a number of inter-related activities, which overlap and do
rigidly follow a particular sequence. It consists of the following steps:

Formulating the objective of the study

Designing the methods of data collection
Selecting the sample plan
Collecting the data
Processing and analysing the data

 Reporting the findings

The primary objective of doing this project is to get the first-hand
knowledge of functioning of an export firm . Since we are not
comparing two different entities on the basis of their financial
results , rather we are learning the export procedure . Hence
exploratory research design is the need of the hour.
Further there are few reasons which made me to use Exploratory
Qualitative Research.
It is not always desirable or possible to use fully structured or
formal methods to obtain information from respondents .
People may be unable or unwilling to answer certain questions or
unable to give truthful answers.
People may be unable to provide accurate answers to questions
that tap their sub- consciousness.
Thus , project research methodology is as follows : In Primary Data , Qualitative Research through in-depth
interviews has been adopted. For interviews non-structured openended questions were used.
In Secondary Data , both internal and external research was done .
For internal research ready to use documents available with the
organisation were used . For external research internet website and
published books were consulted .

RESEARCH DESIGN
Research Design is a plan, conceptual structure, and strategy of

investigation conceived as to obtain answers to research question and to

control variance. The research design refers to the overall strategy that
you choose to integrate the different components of the study in a
coherent and logical way, thereby, ensuring effectively addressing the
research problem; it constitutes the blueprint for the collection,
measurement, and analysis of data.
The General study was converged as a specific study for Toyota .The
approach to the research design task went through the following tasks.
DATA COLLECTION
Data collection is any process of preparing and collecting data, for
example, as part of a process improvement or similar project.
Data can be collected by two methods:
1) Primary Method
2) Secondary Method
Primary methods
Primary sources are original sources from which the researcher directly
collects data that have not been previously collected, e.g., collection of
data directly by the researcher on brand awareness, brand preference,
brand loyalty and other aspects of consumer behaviour from a sample of
consumers by interviewing them.
Secondary methods
Secondary data can be gathered quickly and inexpensively, compared to
primary data (data gathered specifically for the problem at hand). Such
data are already available and can be obtained much faster and at a
fraction of the cost of collecting them again.
The purpose of data collection is to obtain information to keep on record,
to make decisions about important issues and to pass information on to
others. Data are primarily collected to provide information regarding a
specific topic.
For successfully completing the project both primary as well as
secondary data was used.

Secondary data was provided to me by the company from their website,

annual reports and business journals

Limitations of the study

1. Concern about the validity : The issue arises from the fact that
qualitative research does not rely on tests for reliability or
credibility that are external to data collection and analyses .
2. Labour intensive data collection : It can be extremely time
consuming . Data collection is the labour intensive process the
researcher immerses himself or herself to build an understanding
of the organisation , through contact with the employees , exposure
to the norms and familiarity with their practices .

Chapter 2
Company Profile

Introduction
About Aman Fashions
Aman Fashions is a recognized manufacturer, exporter and
supplier of Ladies Garments, Kids Wear and Men Apparels.
Founded in the year 2001, Aman Fashions is a leading exporter
manufacturer of apparels and garments .
Aman fashions established in 1995 is a leading apparel export
house in India. Reputed for excellent product development and
design capacity.
A leading exporter and manufacturer specialised in ladies and
children garments.
An exporter manufacturer based in the capital of India with plants
based at both Delhi and the outskirts with a turnover of USD 10
million.
Dynamic and young management team who has an experience of
more than 15 years in the apparel trade .
Selective about clientele . It has focused on developing capabilities
to cater to the high end market .
One of the few exporters with extensive experience in serving high
fashion wears in South Asia .
Aman fashions manufactures and sells a wide range of highly
fashionable garments for top end customers in international
markets and employs over 500 people .

Vision and Key Strength

The vision of the company is to become the leading exporter and
manufacturer of apparel by continuously excelling in quality , service
and customer satisfaction using the best technology , processes and
people .
Well qualified trained and committed professionals with a shared vision .

High qualified design team , Product development skills and a design

studio .
High degree of adoption of advanced manufacturing systems . All
factories and offices are electronically linked to access information .
Focus on Quality .
Mission
To become the most preferred one-stop source for ready-made
garments & ready to cut fabricsTo constantly update the technology and
skill sets to cater to the ever changing needs of the apparel & textile
industry.
Quality Policy
The company is committed to achieve total customer satisfaction by
producing superior products at competitive price and timely delivery
with total involvement and excellence.

Infrastructure

400 sewing machines on site

30 ari embroidery machines
25 chicken embroidery machines
650 conveyer belt needle detector machines
It has its own washing , dry cleaning and finishing units
Total workforce includes 230 people and an additional 200 people
working on contractual basis .

Capacity
Capacity of manufacturing approx. 150000 garments /month .
Has the ability and experience to design and execute
ornamentation in fabric and garment by hand /machine
embroidery and printing.

 Reliable and resourceful supply chain who have been partnering

for many years .
State of the art manufacturing facilities which are fully compliant .
Rigorous internal quality systems have been the reason for the
continuous patronage from our customers.

Chapter 2
Company Profile

Chapter 3
Review of literature

Review of literature shows the previous studies carried out by the researcher in this
field in order to gain insight into extent of research. The research problem can be
more understood and made specific referring to theories, reports, records and other
information made in similar studies. This will provide the researcher with the
knowledge on what lines the study should proceed and serves to narrow the problem.
Thomas A. Cook (1994) says, One of the major pitfalls in an international sale is
the quality of the documentation supporting the transaction. A mistake in spelling,
execution, language or number of copies will cause substantial delays in obtaining
clearance and require additional expenditures to complete the process.Many
potential exporters shy away from exporting due to the fear of the potential
headaches caused by export documentation. In reality, while the process is
complicated and has a steep learning curve, with the right approach and support
from several resources the process can be simplified and the inherent obstacles lifted.
Most of the necessary documents required for an export transaction are the invoice,
packing list, export declaration and the bill of lading. Other documents that may be
required include: payment instruments (letters of credit, sight drafts),
health/sanitary certificates, certificates of origin, export/import licenses, SGS
inspection certificates, carnets (customs passes), certificates of insurance and
required import documents. In addition to knowing the specific documents, the
exporter will need to know language, the number of copies, required signatories,
format, notarization, consularization, and the shipping instructions.
Laurel Delaney (2006) , describes AES Direct ,a free online process for filing
Shipper's Export Declarations. AES stands for Automated Export System. Here are
some highlights:
1. Ensures export compliance- It returns a confirmation number to verify that you
successfully filed your export documentation.
2. Corrects errors- Get immediate feedback when data is omitted or incorrect, and
correct errors at any time.
3.Eliminates paper review - Eliminates time delays of handling paper.
4.Stays up-to-date with trade agreements - AES conforms to NAFTA and GATT,
making iteasier to do business in multiple countries.
5. Evaluates and measures potential markets - Provides accurate and timely export
statistics.

Koch and John (2007) says the subsequent need is to reduce the risk of loss to
the small business exporter if and when their foreign customer does not pay the
exporter's sales invoice. Again, there are solutions to mitigate these risks of loss,
which result from two sets of risk of loss event perils:1.Foreign "Commercial" Risk of
Loss Events .This event occurs in the foreign client's inability or failure to pay
invoices due to Bankruptcy/Insolvency, Slow-Pay Behavior (Protracted Default) ,
Devaluation of Foreign Currency2.Foreign 'Political' Risk of Loss Events .This event
occurs when a foreign country's regulations and statutes allow Confiscation of Goods,
Suspension of Import Licenses, War, Civil Strife, Rebellion, Currency Inconvertibility
Sales made under irrevocable letters of credit (LCs) are a traditional tool used to
mitigate risk of loss. An LC places the U.S. exporter's bank and their foreign
customer's bank inside the trade transaction, reducing the risk of loss to both parties
for failure of either one to live up to the export sales/purchase contract. The
exporter's commercial bank will assist with the LCs if the bank provides international
banking services, or if the bank uses another correspondent bank that maintains an
international banking department. There are some drawbacks to LCs. Not all foreign
buyers can pay under an LC because of the high fees, often 2-3% of shipment value.
An LC requires a credit relationship between the foreign importer and its bank,
which might divert precious working capital from the foreign buyer's other local
credit needs.
Corinne Campbell (2009) : says, The True Cost of Exporting is the cost of export
documentation, a necessary expense that can be eased by knowing whats required.
Here are some ways to tighten upon export documentation. Organizing the right
documentation and paperwork makes the export process simpler, smoother and
cheaper. When it comes to a paper trail in export, it doesnt matter if you are
shipping large volumes or just sending a few samples: the goods have to get there
and the exporter has to get paid. Not having the right paperwork can result in an
importer not being able to accept the goods and the exporter not being paid, which is
costly in terms of time and money. Export documentation covers the spectrum of:
shipping documents, commercial documents, inspections, permits and consular
stamps. Each requires preparation time, courier costs and fees with its associated
risks of mistakes adding to delays and considerable costs. Documentation must be
precise because slight discrepancies or omissions may prevent merchandise from
being exported, result in non-payment, or even result in the seizure of the exporters
goods by customs. Most documentation is routine for freight forwarders and customs
brokers, but the exporter is ultimately responsible for the accuracy of its documents.
The number and kind of documents the exporter must deal with varies depending on
the destination of the shipment. Because each country has different import
regulations, the exporter must be careful to provide all proper documentation. It is
important to do your research with customs, your industry association, government
departments, freight forwarders and the overseas buyer to be fully aware of the
procedures per product and per country of export. It would be a waste of time and
money to go through researching the specific needs of your export and not having the
internal knowledge to implement a process. Training yourself and your staff in the
intricacies of export including documentation, logistics, finance as well as cultural
issues can make the difference between being successful for years to come or failing
after the first shipment. International trade carries high levels of risk. Knowing how
to avoid the pitfalls is the key to success .

Posner and Martin (2000) in his study found that it is surprising that many
traders do not use Incoterms to help them draft their export documentation. The
International Chamber of Commerce's (which has an international membership from
over 130 countries) Guide to Inco terms 2000 is a superb helpline to the companion
Inco terms 2000, which came into force on 1 January 2000. A definition of EXW EX
Works says there is not only a color chart showing the seller's primary duty but it also
describes the documents required, the optional documents that may be required and
the buyer's primary duty.

Chapter 4
Analysis and Interpretation

Understanding the Apparel Business Process

The textile and apparel supply chain accounts for a good share
in terms of number of companies and people employed. The
apparel industry here is divided into four main segments. At
thetop of the supply chain, there are fiber (raw material)
producers using either natural or syntheticmaterials. Raw fiber
is spun or knitted into fabric by second segment. The third
segment of the supplychain is the apparel manufacturer which
converts fabric into garment with many processes involved.The
final segment is the retailers who are responsible for making
apparels available to consumers.
It has been explained using the T angle apparel supply chain.
This shows how buyer, suppliers and garment manufacturer are
linked to each other. The T angle illustrates how information
flows from the buyer to the apparel manufacturer. The
information normally, sketches of the garment given by the
buyer, are studied by the manufacturer and accordingly list of
raw materials required is made. The different swatch (standard
for type of yarn, colour of the yarn and piece of accessories) are
sent to different suppliers for development. The supplier
develops and sends it to manufacturer and which is forwarded
to buyer. Once approved by buyer, the orders are placed with
the suppliers with approved samples. When the raw materials
are received as per the specifications given to the supplier,inhouse manufacturing starts with the production. The different
process of manufacturing results in the final garment product

which is finally dispatched to the Buyer. The Buyer then retails

the same through stores to the ultimate consumers.

The T angle of the Apparel Supply Chain

Description of the Buyer Side of the Supply Chain

The buyer side is normally involved with designing of the garment,
production of samples,order collection, apparel retail.

 Apparel Design
Designing of Apparel is either done in-house or contracted to design
companies. The first stepin designing is the analysis of the consumer
which the Company is targeting. The apparel design isinfluenced by
various parameters like other designer collection presented in the
fashion cities of theworld, fashion reviews from earlier seasons, fashion
magazine also plays an important input for thedesign efforts and most
important is the feedback gained from the sales of the similar products
thatwere developed earlier.

Production of samples and order collection

The next step after the design in apparel supply chain is the production
of the samples.
Once the designs are developed, decisions regarding the fabric like
cotton or polyester and quantity etc are made. Based on fabric and
quantity decided, decisions related to country and manufacturers are
made. Once decision is made, developed designs are sent to different
manufacturers and are asked to develop proto samples (the stage brings
design from paper to cloth for design appearance). Normally, during
proto stage manufacturer figure stands between 5 and 8. Once proto are
developed ,number of manufacturers is reduced to 2 to 3 depending on
the total quantity of the article and also on selected manufacturer
production capacity or volumes. The order quantities are placed to
different manufacturers and manufacturer is asked to develop size-sets
(alternate sizes of the garment are developed example S: Small, L: Large,
XXL: Extra Large). Once size-set is approved, sale samples (samples
developed for advertising and see the market response towards
the article) are made. Finally, with everything in place two identical
pieces are developed one for the buyer and other for the manufacturer
called as sealer (sealer sample is identification or standard for
production). This sample is stamped by the buyers and the manufacturer
can proceed with the production.

Apparel Retail
Apparel products are made available to consumers in a variety of retail
outlets. Specialtystores offer a limited range of apparel products and

accessories specialising in a specific marketsegment. Apparel sales also

take place through wholesalers or mass merchandisers such as WalMart,Kmart and Target. These retailers offer a variety of hard and soft
goods in addition to apparel.Departmental stores like Macys, Nordstrom
offer a large number of national brands in both hard andsoft goods
categories. Off-price stores, such as Marshalls and T.J.Maxx buy excess
stock of designer-label and branded apparel from retailers and are able
to offer lower prices but with incompleteassortments. The apparel sale is
also shared by mail order companies, e-tailors through internet,
andfactory outlets etc.

Description of the Supplier Side of the Apparel Supply Chain

The suppliers in the apparel manufacturing are quite diversified. It
involves suppliers of different raw materials such as fibre and yarn
producers, fabric manufacturers and other raw-materials.
Fiber and Yarn Production
Fibres are categorised into two groups: natural and man-made. Natural
fibre includes plantfibres such as cotton, linen, jute etc and animal fibre
such as wool. Synthetic fibres include nylon, polyester, acrylic etc.
Synthetic fibre production usually requires significant capital and
knowledge. Natural and synthetic fibres of short lengths are converted
into yarn by spinners, throwsters andtexturizers. Different types of
fibres can also be blended together to produce yarn such as grindleetc.
Accessory Production
Surface embellishments have taken the apparel section to a great extent.
A variety of buyersdesire to use different embellishment for their
customers. Those traditional like buttons and hooks torubber prints and
design made items. The manufacturer depends on these suppliers
specializing inaccessory for the supply chain and order execution.
Description of the Manufacturer Side of the Supply Chain
Fabric production

This segment of supply chain transforms the yarn into fabric by process
of knitting. Inknitting, yarn is interloped by latched and spring needles
i.e. two different loops are mingled together with needle adjustment.
Grey Yarn may be knitted by a simple procedure to produce grey fabric
andwhich are then dyed for a specific color. Instead, dyed yarns may also
be knitted but not dyed.Once the approvals regarding the raw-material
are made by the buyer, the manufacturer can proceedwith the
production.
Apparel Production
The process proceeds once the fabric is produced; it is either dyed or
washed. The dyed(coloured) yarn fabric is washed and grey fabric is dyed
into a specific colour. After dyeing or washing, fabric is finished by
removing water in the tumbler and later pressed in stenter which also
maintains width of the fabric. Now the fabric is ready for garmentising
i.e. it is ready to be cut and stitched into the garment. Garmentising
starts with the design of the garment to be made (usually on the paper
called specs). Patterns (usually made up of thicker and stronger paper)
are made from the design which is then used to cut the fabric (cutting
usually happens in the form of layers). An efficient layout of the patterns
on the layers of fabric is crucial for reducing the wasted material. CAD
systems are used for pattern layout and are integrated together with
cutting systems. In apparel manufacturing, all the stages are labour
intensive as they are not suitable for any kind of automation.In the
stitching section, garment is usually assembled using the progressive
bundle system(PBS). In PBS, the work is delivered to individual work
stations from the cutting department in bundles. Sewing machine
operators then process or sew them in batches i.e. first few are
operationare joining the different parts together and then further
amendments related to design are carried out.The supervisors direct and
balance the line activities and check the quality. This involves large work
in progress (WIP) inventories and minimal flexibility. For faster apparel
production, use of unit production system which reduces the buffer sizes
between the operations or modular assemblysystems and allows a small
group of sewing operators to assemble the entire garment.

Finishing ,Packaging and Dispatch of Apparel

Garments produced are labelled, packaged and usually shipped to a

warehouse. The garments are then shipped to the retailers warehouse.
In an effort to reduce time from placement of the product order to the
consumers purchase of the apparel, several practices are gaining
popularity. There is increased automation and use of electronic
processing
in the warehouses of both the manufacturers and the retailers .

Working of various departments contributing towards

processing of an export order
Departments Functions and Operations
Company mainly deals in two segments of the apparel supply chain i.e.
one manufacturing of fabric and other manufacturing of garment. These
two segments are two different processes but arevery much linked in the
supply chain. The Company has different departments each having
specifiedfunctions and responsibilities. Description of each department
will follow in respect to how they occur in supply chain:
Yarn Department
Yarn (thread) is one of the most important raw-materials for the
garment manufacturing.Company purchases yarn from other spinning
mills across the country and also sometimes from other countries such
as China and Taiwan. Yarn department is responsible for placing order
of yarn to the mills. Their responsibility is to make sure yarn is ordered
from right supplier, delivered in right time with desired quality and
maintain stock listing of yarn. Yarn department is also responsible for
checking the quality i.e. strength, color and quantity of the yarn
delivered. The decision regarding the yarn quantity, quality and strength
is decided by PPC i.e. production, planning and control department. PPC
places the order one month in advance.
Knitting Department
Knitting department is responsible for producing knitted fabric i.e. fabric
from yarn. For fabric production, two types of machines are normally
used i.e. circular knitting machine and flat knitting machine. Knitting
department receives orders from PPC stating article or style number and
quantity of fabric required. The knitting department makes the
production planning for all knitting machines based on request from
PPC and also calculates and orders required yarn from the yarn
department. Planning is usually done for every week.
Washing and Dyeing Department
The department is responsible for two different stages in garment
manufacturing. For grey(not colored) fabric, department is responsible
for coloration of fabric and for dyed (colored) fabric, department is
responsible for washing. The process of dyeing is time consuming and as
different color checks are required. The department receives order from
the PPC stating article and quantity required. The department makes the
production plan for the dyeing and the washing machine based on order

from the PPC and also sends request to knitting department for the
dispatch of the fabric. Planning is done on weekly basis. Dyeing is sent to
the processing unit in Tirupur or Erode. Selection is based on the basis of
cost, finish, loyalty and credit terms. The processed fabric is imported
from China and Taiwan in case when it cannot be done in India. This is
upon the request of the buyer specifically.
Finishing Department
The department is responsible for finishing of the fabric with a proper
procedure so that it is ready for garment production. Whether the fabric
is dyed or washed, it follows the same process in the finishing
department. Once the fabric is washed or dyed, it needs to be tumbled in
tumbler (sort of big washing machine) responsible for removing water
and maintain the fabric width and shrinkage. After which fabric is dried
in a Stenter (dryer) and packed in layer and is ready for garment
production. The finishing departments receive orders from PPC again
stating the article or style number and the quantity. The department
sends the fabric to the mentioned cutting section.
Cutting Department
The department is responsible for cutting of the fabric into different
parts of the garment. This department is mainly responsible for cutting
and avoiding wastage. To ensure minimum wastage, proper set of tools
such as CAD and others are used in the process. The PPC by using CAD
and other tools issues article average with a draft or diagram of how
different patterns should be placed on to the layer. The cutting
department based on their experience and expertise either accepts the
proposed average or sometimes gives a better average by few percent.
The department makes production plan for all cutting stations based on
article or style requested. This also works on weekly basis. Once fabric is
cut different parts of the same garment are bundled together.
Stitching Department
The department is responsible for stitching different parts of garment
together. The process takes place in the assembly line system. The
assembly line system is the set of many different stitching machines each
for a specific purpose. These machines are arranged in an orderly fashion
depending on how different parts of garment should be attached.
Assembly line method is used for large production. PPC decides on the
article or style to be produced with quantity. The stitching department
makes necessary production planning i.e. time line in accordance with

each article. The stitching process is the most time consuming and
labour intensive process in the entire garment production. The planning
is done weekly.
Finishing and Packaging Department
This is final stage before the garment is ready to be shipped. As the
garment is already finished, it requires a series of quality checks. The
garment goes through the quality checks like colour test, washing test,
stitching test etc. After which it is steam pressed, labelled, packed into
garment bags and finally, put into the cartons. Once all cartons are
packed and labelled , external quality check takes place and goods are
shipped. The PPC department gives the details of the PO to be finished,
packed and dispatched.
Merchandising Department
The department acts as a liaison between the buyer and manufacturing
division. On one hand,the department is responsible for notifying
changes in the product to the PPC and also to make sure that article is
produced as per planning by the PPC and within dispatch time limits. On
the other hand, it has to continually update buyer with planning and
production status. The department takes care of all correspondence with
buyer and is responsible for communicating it to PPC. The department
also takes care of necessary sampling such as proto, size set and final
which is necessary prior to production.
Production Planning and Control (PPC) Department
The department is responsible for making plans for the entire
organization i.e. all the departments. PPC being in the centre of all
departments also controls their functionality. The PPC sends production
plan to different departments on weekly basis and daily for any
amendments. The PPC keeps check on different departments by
requesting planning and production reports for each day. PPC only
receives orders from the Management. With order quantity and dispatch
date, it does the planning for product cycle. The top management is in
continuous contact with PPC.

Pre-Shipment Procedure
On receiving the requisition & purchase order from merchant
(See Annexure 3 and 4),documentation department issues an invoice.
Two invoices are prepared i.e. commercial invoice & custom invoice.
Commercial invoice is prepared for the buyer & Custom invoice is
prepared for the Custom authorities of both the countries.
Packing list is prepared which details the goods being shipped.
GSP certificate is prepared if the consignment is exported to EU or
countries mentioned in theGSP list.
Buying house inspects the goods & issues an inspection certificate.
Certificate of origin is also issued and attached, if required.
Following documents are given to Customs for their reference:
Custom Invoice
Packing list
IEC certificate
Purchase Order or L/C, if required.
Custom annexure
On receipt of above documents, customs will issue clearance
certificate.
After custom clearance a set of documents with custom clearance
receipt are sent along withthe consignment to the forwarder. Forwarder
books the shipment & as per the size of thecartons calculates CBM &
decides which container to be used.
Following documents are sent to buying house for their reference, as
per buyers requirement:
Invoice
Packing List
GSP (if exports to Europe)
Certificate of Origin (if required)
Wearing Apparel sheet
A copy of FCR/ Airway Bill/ Bill of Lading

Buying house then intimates the buyer about the shipment & gives the
details regarding it. Buying house will send a set of these documents to
the buyer.
Buyer collects the consignment from the destination port by showing
the following documents:
Invoice
Packing List
Bill of lading/ FCR/ Airway Bill
On shipment of goods, exporter will send the documents to the
importers bank.

Post-Shipment Procedure
A foreign buyer will make the payment in two ways:
TT ( telegraphic transfer) i.e. Wire Transfer (Advance payment,
as per the clause 50%advance & remaining 50% on shipment)
Letter of Credit
If the payment terms are a confirmed L/C then the payment will be
made by the foreign bank onreceiving the following documents:
Invoice
Packing list
B/L
Any other required by the buyer or the country of import.
The payment terms can be:
At Sight
Within 15 days from Bill of Lading or Airway Bill date.
Within 30 days from Bill of Lading or Airway Bill date.
Within 60 days from Bill of Lading or Airway Bill date.

 Within 90 days from Bill of Lading or Airway Bill date.

After shipment, exporter sends the documents to the buyers bank for
payment. As the buyers bank receive the documents it will confirm with
the buyer for release of payment. On confirmation, it will make the
payment in the foreign currency. The transaction will be Bank to Bank.
The domestic branch will credit the exporters account, as against the
respective purchase order or invoice, in Indian rupees by converting the
foreign currency as per the current bank rate.
If the payment is through wire transfer, the payment will be made as
per the terms agreed by the exporter (Advance payment, as per the
clause 50% advance & remaining 50% on shipment).
Export Documents
An export trade transaction distinguishes itself from a domestic trade
transaction in morethan one way. One of the most significant variations
between the two arises on account of the muchmore intensive
documentation work. The documents mentioned in the pre & post
shipment procedureare discussed below:
1. Invoice : It is prepared by an exporter & sent to the importer for
necessary acceptance. When the buyer is ready to purchase the
goods, he will request for an invoice. Invoice is of 3 types:
Commercial invoice :It is a document issued by the seller of
goods to the buyer raising his claim for the value of goods
described therein, it indicates description of goods, quantity, value
agreed per unit & total value to be paid. Normally, the invoice is
prepared first, &several other documents are then prepared by
deriving information from the invoice.
Consular invoice :It is certification by a consul or Government
official covering an international shipment of goods. It ensures that
exporters trade papers are in order & the goods being shipped do
not violate any law or trade restrictions.

 Customs invoice : It is an invoice made on specified format for

the Custom officials to determine the value etc. as prescribed by
the authorities of the importing country.
2. Packing list: It shows the details of goods contained in each
parcel /shipment. Considerably more detailed and informative
than a standard domestic packing list, it itemizes the material in
each individual package and indicates the type of package, such as
a box, crate, drum or carton. Both commercial stationers and
freight forwarders carry packing list forms.
3. Certificate of Inspection : It is a type of document describing
the condition of goods and confirming that they have been
inspected. It is required by some purchasers and countries in order
to attest to the specifications of the goods shipped. This is usually
performed by a third party and often obtained from independent
testing organizations.
4. Certificate of Origin : Importers in several countries require a
certificate of origin without which clearance to import is refused.
The certificate of origin states that the goods exported are
originally manufactured in the country whose name is mentioned
in the certificate. Certificate of origin is required when:
The goods produced in a particular country are subject to
preferential tariff rates in the foreign market at the time
importation.
The goods produced in a particular country are banned for
import in the foreign market.
5. GSP : It is Generalized System of Preference. It certifies that the
goods being exported have originated/ been manufactured in a
particular country. It is mainly useful for taking advantage of
preferential duty concession, if available. It is applicable in
countries forming European Union. It has total of 12 columns to be
declared by the exporter. They are:
1.Exporters name, address and country
2. Importers name, address and country

3. Means of transport and route

4. For official use(to be filled by the officials)
5. Item no.
6. Marks and no. packages
7. No. and kind of packages and description of goods
8. Origin criterion
9. Gross weight or quantity
10. No. and date of invoice
11. For certification of competent authority- in this column the
competent authority will stamp andsign for the certification of the
form.
12.
Declaration by the exporter in this column the exporter declares
the above details mention dare correct and country where the
goods produced for export and name of the importing country and
then stamped and signed by the authorized representative of
exporter with place an date. This form A GSP is sent between the
countries, which have bilateral agreements. This certified original
form will be used by importing country to import the consignment
with deduction in import duty.
6. IEC Certificate : It is an Import-Export Code Certificate issued
byDGFT, Ministry of Commerce, and Government of India. It is
a10 digit code number. No exports or imports will be effected
without the IEC code. It is mandatory for every exporter.
7. Wearing Apparel Sheet : It is like a check list which gives the
detail regarding the content & design of the garment packed.
8. Bill of Lading : The bill of lading is a document issued by the
shipping company or its agent acknowledging the receipt of goods
on board the vessel, and undertaking to deliver the goods in the

like order and condition as received, to the consignee or his order,

provided the freight and other charges as specified in the bill have
been duly paid. It is also a document of title to the goods and as
such, is freely transferable by endorsement and delivery.
A bill of lading normally contains the following details:
The name of the company
The name and address of the shipper / exporter
The name and address of the importer / agent
The name of the ship
Voyage number and date
The name of the ports of shipment and discharge
Quality, quantity, marks and other description
The number of packages
Whether freight paid or payable
The number of originals issued
The date of loading of goods on the ship
The signature of the issuing authority.

9. Airway Bill : An airway bill, also called an air consignment note,

is a receipt issued by an airline for the carriage of goods. As each
shipping company has its own bill of lading, so each airline has its
own airway bill. Airway Bill or Air Consignment Note is not treated
as a document of title and is not issued in negotiable form.
Mate's Receipt : Mate's receipt is a receipt issued by the
Commanding Officer of the ship when the cargo is loaded on the
ship. The mate's receipt is a prima facie evidence that goods are
loaded in the vessel. The mate's receipt is first handed over to the

Port Trust Authorities. After making payment of all port dues, the
exporter or his agent collects the mate's receipt from the Port
TrustAuthorities. The mate's receipt is freely transferable. It must
be handed over to the shippingcompany in order to get the bill of
lading. Bill of lading is prepared on the basis of the mate'sreceipt.
It contains information relating to ;
Description of packages.
Condition of goods / packages loaded on the vessel.
Name of the vessel
Date of loading
Port of delivery
Name of the address of the shipper exporter
Name and address of the importer / consignee.
Other required details.
10. Shipping Bill : Shipping bill is the main customs document,
required by the customs authorities for granting permission for the
shipment of goods. The cargo is moved inside the dock area only
after the shipping bill is duly stamped, i.e. certified by the customs.
Shipping bill is normally prepared in five copies:
Customs copy
Drawback copy
Export promotion copy
Port trust copy
Exporter's copy
11. Letter of Credit : This method of payment has become the most
popular form in recent times; itis more secured as company to
other methods of payment (other than advance payment). A letter
of credit can be defined as an undertaking by importers bank

stating that payment will be made to the exporter if the required

documents are presented to the bank within the variety of the
L/C.
Contents of a Letter Of Credit
A letter of credit is an important instrument in realizing the
payment against exports. So,needless to mention that the letter of
credit when established by the importer must contain all necessary
details which should take care of the interest of Importer as well as
Exporter. Let us sees that a letter of credit should contain in the
interest of the exporter. This is only an illustrative list.
Name and address of the bank establishing the letter of credit
Letter of credit number and date
The letter of credit is irrevocable
Date of expiry and place of expiry
Value of the credit
Product details to be shipped
Port of loading and discharge
Mode of transport
Final date of shipment
Details of goods to be exported like description of the product,
quantity, unit rate, terms of shipment like CIF, FOB etc.
Type of packing
Documents to be submitted to the bank upon shipment
Tolerance level for both quantity and value
If L/C is restricted for negotiation
Reimbursement clause

Terms of Shipments Inco terms

The INCOTERMS (International Commercial Terms) is a universally
recognized set of definition of international trade terms, such as FOB,
CFR & CIF, developed by the International Chamber of Commerce (ICC)
in Paris, France. It defines the trade contract responsibilities and
liabilities between buyer and seller. It is invaluable and a cost-saving
tool. The exporter and the importer need not undergo a lengthy
negotiation about the conditions of each transaction. Once they have
agreed on a commercial terms like FOB, they can sell and buy at FOB
without discussing who will be responsible for the freight, cargo
insurance and other costs and risks. The purpose of Inco terms is to
provide a set of international rules for the interpretation of themost
commonly used trade terms in foreign trade. Thus, the uncertainties of
different interpretations of such terms in different countries can be
avoided or at least reduced to a considerable degree. Thescope of Inco
terms is limited to matters relating to the rights and obligations of the
parties to the contract of sale with respect to the delivery of goods. Inco
terms deal with the number of identified obligations imposed on the
parties and the distribution of risk between the parties.
More Clarification on Inco terms
EXW (At the named place)Ex Works: Ex means from. Works
means factory, mill or warehouse, which are the sellers premises. EXW
applies to goods available only at the sellers premises. Buyer is
responsible for loading the goods on truck or container at the sellers
premises and for the subsequent costs and risks. In practice, it is not
uncommon that the seller loads the goods on truck or container at the
sellers premises without charging loading fee. The term EXW is
commonly used between the manufacturer (seller)and export-trader
(buyer), and the export-trader resells on other trade terms to the foreign
buyers. Some manufacturers may use the term Ex Factory, which means
the same as Ex Works.
FCA (At the named point of departure)Free Carrier:
The delivery of goods on truck, rail car or container at the specified point
(depot) of departure, which is usually the sellers premises, or a named
railroad station or a named cargo terminalor into the custody of the
carrier, at sellers expense. The point (depot) at origin may or may not be
acustoms clearance centre. Buyer is responsible for the main
carriage/freight, cargo insurance and other costs and risks.

In the air shipment, technically speaking, goods placed in the custody of

an air carrier are considered as delivery on board the plane. In practice,
many importers and exporters still use the term FOB in the air shipment.
FAS (At the named port of origin)Free Alongside Ship:
Goods are placed in the dock shed or at the side of the ship, on the dock
or lighter, within reach of its loading equipment so that they can be
loaded aboard the ship, at sellers expense. Buyer is responsible for the
loading fee, main carriage/freight, cargo insurance, and other costs and
risks In the export quotation, indicate the port of origin(loading)after the
acronym FAS, for example FAS New York and FAS Bremen. The FAS
term is popular in the break-bulk shipments and with the importing
countries using their own vessels.
FOB (At the named port of origin)Free on Board:
The delivery of goods on the board the vessel at the named port of origin
(Loading)at sellers expense. Buyer is responsible for the main
carriage/freight, cargo insurance and other costs and risks. In the export
quotation, indicate the port of origin (loading) after the acronym FOB,
for example FOB Vancouver and FOB Shanghai. Under the rules of the
INCOTERMS 1990, the term FOB is used for ocean freight only.
However, in practice, many importers and exporters still use the term
FOB in the air freight. In North America, the term FOB has other
applications. Many buyers and sellers in Canada and the USA dealing on
the open account and consignment basis are accustomed to using the
shipping terms FOB Origin and FOB destination. FOB Origin means the
buyer is responsible for the freight and other costs and risks. FOB
Destination means the seller is responsible for the freight and other costs
and risks until the goods are delivered to the buyers premises which may
include the import custom clearance and payment of import customs
duties and taxes at the buyers country, depending on the agreement
between the buyer and seller. In international trade, avoid using the
shipping terms FOB Origin and FOB Destination, which are not part of
the INCOTERMS (International Commercial Terms).
CFR (At the named port of destination)
Cost and Freight: The delivery of goods to the named port of
destination (discharge) at the sellers expenses. Buyer is responsible for
the cargo insurance and other costs and risks. The term CFR was
formerly written as C&F. Many importers and exporters worldwide still
use the term C&F.
CIF (At named port of destination)Cost, Insurance and Freight:
The cargo insurance and delivery of goods to the named port of
destination (discharge) at the sellers expense. Buyer is responsible for

the import customs clearance and other costs and risks. In the export
quotation, indicate the port of destination (discharge) after the acronym
CIF, for example CIF Pusan and CIF Singapore. Under the rules of the
INCOTERMS 1990, the term CIFI is used for ocean freight only.
However, in practice, many importers and exporters still use the term
CIF in theair freight.
CPT (At the named place of destination)Carriage Paid To: The
delivery of goods to the named port of destination (discharge) at the
sellers expenses. Buyer assumes the cargo insurance, import custom
clearance, payment of custom duties and taxes, and other costs and
risks. In the export quotation, indicate the port of destination
(discharge)after the acronym CPT, for example CPT Los Angeles and
CPT Osaka.
CIP (At the named place of destination)
Carriage and Insurance Paid To: The delivery of goods and the
cargo insurance to the named place of destination (discharge) at sellers
expense. Buyer assumes the importer customs clearance, payment of
customs duties and taxes, and other costs and risks.
DAF (At the names point at frontier)
Delivered at Frontier: The delivery of goods at the specified point at
the frontier on sellers expense. Buyer is responsible for the import
custom clearance, payment of custom duties and taxes, and other costs
and risks.
DES (At named port of destination)
Delivered Ex Ship: The delivery of goods on board the vessel at the
named port of destination(discharge) at sellers expense. Buyer assumes
the unloading free, import customs clearance, payment of customs
duties and taxes, cargo insurance, and other costs and risks.
DEQ (At the named port of destination)
Delivered Ex Quay: The delivery of goods to the Quay (the port) at the
destination on the buyers expense. Seller is responsible for the importer
customs clearance, payment of customs duties and taxes, at the buyers
end. Buyer assumes the cargo insurance and other costs and risks.

DDU (At the named point of destination)

Delivered Duty Unpaid: The delivery of goods and the cargo
insurance to the final point of destination, which are often the project
site or buyers premises at sellers expense. Buyer assumes the import
customs clearance, payment of customs duties and taxes. The seller may
opt not to insure the goods at his/her own risks.
DDP (At the named point of destination)
Delivered Duty Paid: The seller is responsible for most of the
expenses, which include the cargo insurance, import custom clearance,
and payment of custom duties, and taxes at the buyers end, and the
delivery of goods to the final point of destination, which is often the
project site or buyers premise. The seller may opt not to insure the goods
at his/her own risk.

Realisation of Export Proceeds

Once the goods have been physically loaded on board the ship, the
exporter should arrange too btain his payment for the exports made by
submitting relevant documents. A complete set of documents normally
submitted for the purpose of negotiation is called a negotiable set of
documents, which usually consist of the following:
1.Bill of exchange
2.Bill of lading
3.Commercial invoice
4.Packing list
5.Inspection certificate
6.GSP certificate
Negotiation
A complete set of negotiable documents is presented to the negotiating
bank through whom the documentary letter of credit has been advised.
Where the exporter has complied with all the terms and conditions of the
letter of credit while submitting his documents to the negotiating bank,
the documents are deemed to be clean. The letter of credit opened by the
buyer through his bank (opening bank) authorizes drawing a bill of
exchange against which payment will be made by the opening bank on
behalf of the buyer, provided the terms and conditions specified in the
letter of credit are complied with.
Bill of exchange
It is the negotiable instrument through which the amount of export
invoice / invoices will be collected from the corresponding bank specified
by the importer through exporters bank. It contains number and date
drawn on, credit no., corresponding bank address, the amount to be
collected , terms of payment, importers name and address with invoice
no. and bill of lading or airway bill no. the drafts drawn are of two
types.1.Sight draft2.Usance draft .If the letter of credit stipulates
payment at sight, the exporter draws a sight draft on the buyer or his
bank. When sight drafts are drawn by the exporter, he expects the buyer
to arrange for payment immediately on presentation of the draft. Until
payment for the draft is made, shipping documents will not be handed
over to the buyer to enable him to clear the goods.

When the exporter has offered credit terms for payment, a Usance
draft is usually drawn by the negotiating bank of the exporter. It is
drawn for the payment after a specified period. The buyer on whom the
draft is drawn retires the draft after 30days, 60days or 90days as agreed
between him and the exporter at the time of concluding the contract. The
letter of credit opened by the buyer will clearly specify the credit period
which has been agreed upon and would mention that the draft should be
drawn for 30,60 or 90 days, as the case may be.
For a credit period beyond 180 days, the exporter has to obtain the prior
permission of the exchange control authorities in India. The bill of
exchange drawn should correspond to the conditions stipulated in the
letter of credit. Besides the negotiation of the documents, the banker has
to perform other formalities. As part of the negotiation set of documents,
the exporter has submitted the duplicate copy of the GR-1 form. After
negotiation are complete, and payment is physically received by the
bank, the duplicate copy of the GR-1 form is sent to the RBI after due
checks. The exporter requires a commercial invoice attested by the bank
for his use in claiming incentives. The bank attests the extra copies of the
commercial invoice supplied by the exporter and returns them to him.
To enable the exporter to claim incentives applicable for exports, a
certificate known as Form I or Bank Certificate is required. The Form I
or Bank certificate describes the product exported, its value, the details
of the invoice, the bill of lading against which the export was made, the
rate of conversion for the exchange for the exchange used, etc. the case of
CIF contracts, the bank certificate specifies the fob value, freight and
insurance under separate headings as evidenced in the bill of lading,
insurance policy and invoice. The bank certificate also indicates the GR-1
form number against which the export was made. The original copy of
the bank certificate is furnished to the exporter and the duplicate copy is
sent to the JDGFT of the area. A third copy may be kept for its official
records.

Realisation of Export Incentives:

The incentives the exporter will get in todays context and the manner in
which they can be obtained are as follows:
Duty Drawback : This refers to a rate fixed by the government based
on the customs duty and excise duty components which go into the
production of an export product. This does not refer to the finished
product excise duty, but to the excise and customs duty paid on all the
raw materials and components which go into the production.

Every year the Department calls for latest data on these through the
Export Promotion Councils, determines the drawback rate and publish it
for the exporters by June of the year. When the shipping bill is submitted
to the customs for the shipping of goods, it consists of a set of five copies.
The duplicate copy is known as the Drawback copy, and this will
contain all the details like description of the product, the port of
destination, the total amount of drawback as per government
notification etc. this copy is endorsement by customs and sent directly by
them to the drawback cell in the customs department situated in the port
from which goods were exported. The exporter can approach this cell for
his drawback payment with any additional details they may ask for.
Excise Rebate : Finished goods which are subject to excise duty for
home consumption are exempt from the duty when they are exported.
The scheme is also applicable where the exported goods contain
excisable goods in their manufacture. The exporter can avail of this
facility in either of the following methods, where finished goods are
excisable:
Export under Bond: Under this method, the exporter has to execute a
bond in favour of Central Excise Authorities. The amount of the bond
will be equal to the duty on the estimated maximum outstanding of
goods leaving the factory without paying the duty and pending
acceptance of their proof of export by excise authorities. No excise need
to be paid by the exporter.
Refund of Duty : If the duty is already paid, after export is made, the
exporter should make a claim with the Central Excise Authorities. After
verification of the claim, the excise authorities will arrange for there fund
of the central excise. Where the excisable materials have been used in the
manufacture, similar to the above arrangement, the exporter can avail of
the facility of manufacturing under bond or he can claim refund after
duty is paid.

Chapter 5

Findings of the study

The organisation is well organised and systematic .
The merchandiser is the connection or key player between all
departments .
Cutting head , stitching head , finishing supervisors and other
heads are the main people with whom a merchandiser deals .
Internatioanl trade process .
Workings of various departments of export firm .
The overall Apparel production process .
Export documentation requirements.

Conclusion
The study was conducted to know the process involved in an
apparel firm and to study about the various departmental
functions which coordinates to complete the export cycle.
The export procedure of the firm has been seen clearly and other
related aspect has been known. The documents that are required
for export are very large in number .
The other basic objective of the study is to know about the
merchandisers role in the company and it is found that they play a
very important and wide role .

Suggestions
As many of the documents are part in the use of documentation
and procedures which may delay and tend to loss the customers.
Update of available export incentives.
The company should check the exchange rates before entering into
particular markets which will help in achieving more profits.
If all the processing units are brought under one roof, it will reduce
the processing time of goods and it will lead to timely delivery of
goods to the customers.
Try for ISO certifications, which will value the company higher.

BIBLOGRAPHY
Balagopal T.A.S, Export Management, Himalaya
Publishing House, nineteenth edition 2007
Kothari C.R., Research Methodology, Method &
techniques, New Age International. Pvt.Ltd,
Second Edition, 1985
Mahajan M.I., A guide on export policy,
procedure and documentation, Tata McGraw hill
publishing company ltd, Third Edition 2005
http://www.sebi.gov.in/dp/splfinal.pdf
as retrieved on April 20, 2010
General manager , Aman fashions
Merchandising department , Aman Fashions

INTERVIEW QUESTIONS
How an export order is processed?
What role the different departments play for the
completion of the export order?
What role does merchandising department play ?
What are the different documents prepared &
used for the export?
What are the Inco-terms?
What is a Letter of credit?
How does Government render its help to your
firm and how do you utilise it ?
Do banks you work with offer their best help?