CRITICAL ANALYSIS OF PERFORMANCE IMPROVEMENT  OF A
Spinning Mill  with 32400 spindles  working on 100% cotton combed yarns
The data given below will help us to understand the impact on overall contribution by
1. Utilisation of the plant						2. Selling price increase
3. Cheaper rawmaterial for coarse counts						4. selling price increase for coarse counts
5. Increased  back process production						6. Increased  spindleage
7. Increased  grams per spindle						8. Working coarses counts
9. working finer counts						10.Raw material price
ASSUMPTIONS:
The selling prices is  the actual net sales price  for a reasonably good yarn produced in Indonesia.
Product mix is decided by Linear programming which satisfies all the constraints given below
Linear programming decides the maximum possible contribution meeting all the constraints.
contrubution = Net sales price - clean raw material cost - packing  and forwarding cost
					grams per
market constraints					spindle
24sc should be less than 60 tons per month					240		utilisation	97%
20sc should be less than 510 tons per month					280		no of RFs	45
30sc should be less than 90 tons per month					170		no spls/RF	720
32sc should be less than 20 tons per month					155
36sc should be less than 20 tons per month					135
40sc should be less than 300 tons per month					120
Total no of ring frames should not be more than 45
							utilised	total	avg
count	24sc	20sc	30sc	32sc	36sc	40sc	rfs	cotrbn	count
								usd
sell price	1.96	1.90	2.10	2.14	2.30	2.40
raw mat	1.30	1.30	1.30	1.30	1.30	1.30
packing	0.04	0.04	0.04	0.04	0.04	0.04
contrbn	0.62	0.56	0.76	0.8	0.96	1.06
12. 5 tons	20.5	0	90	20	20	225	44.3	354291	36.09
13.5 tons	60	22.9	77.5	0	20	225	45	366179	34.39
15 tons	60	137	7.99	0	20	225	45	377470	31.4
17 tons	0	303	0	0	0	207	45	389117	28.12
19 tons	0	408	0	0	0	162	45	400217	25.69
21 tons	3.39	510	0	0	0	117	45	411308	23.72
if the utilisation goes up by 1% I.e form 97% to 98%
15 tons	60	127	15.7	0	20	227	45	380179	31.68
17 tons	0	297	0	0	0	213	45	392156	28.36
19 tons	0	402	0	0	0	168	45	403256	25.9
if grams per spindle is increased by 5%
15 tons	60	88.6	45.6	0	20	236	45	390605	32.74
17 tons	60	171	90	0	20	169	45	399811	29.5
19 tons	60	276	90	0	20	124	45	410911	26.92
if the selling price goes up 5%
15 tons	60	137	7.99	0	20	225	45	426494	31.4
17 tons	0	303	0	0	0	207	45	442743	28.12
19 tons	0	408	0	0	0	162	45	458418	25.69
if the raw material price comes down by 3 cents
15 tons	60	137	7.99	0	20	225	45	390970	31.4
17 tons	0	303	0	0	0	207	45	404417	28.12
19 tons	0	408	0	0	0	162	45	417317	25.69
if the rawmaterial for 20s, 24s and 30s is cheaper by 3 cents compared to other counts
15 tons	60	137	7.99	0	20	225	45	383634	31.4
17 tons	60	250	0	0	0	200	45	398281	28.3
19 tons	60	355	0	0	0	155	45	412531	25.84
if grams per spindle comes  down by 3%  bec of cheaper raw mat for 20s,24s and 30s
15 tons	51.3	154	0	0	20	225	45	381512	31.15
17 tons	0	310	0	0	0	200	45	394824	27.84
19 tons	0	418	0	0	0	152	45	407902	25.35
if grams per spindle comes down by 10% bec of cheaper rawmat for 20s,24s and 30s
15 tons	0	212	0	0	19.8	218	45	375491	30.41
17 tons	0	326	0	0	20	164	45	385255	27.05
19 tons	0	441	0	0	20	109	45	395018	24.39
if 40sc can not be sold more than 180 tons per month
15 tons	60	92.1	90	7.91	20	180	45	373479	31.45
17 tons	60	243	7.14	0	20	180	45	386071	28.3
19 tons	0	408	0	0	0	162	45	400217	25.69
if 20sc can not be sold more than 300 tons per month
15 tons	60	137	7.99	0	20	225	45	377470	31.4
17 tons	3.39	300	0	0	0	207	45	389108	28.13
19 tons	60	300	90	0	20	97	45	395617	26.0
if 20sc can not be sold more than 150 tons per month
15 tons	60	137	7.99	0	20	225	45	377470	31.4
16 tons	60	150	90	0	20	161	45	379760	29.79
17 tons	60	150	90	0	20	161	45	379760	29.79
19 tons	60	150	90	0	20	161	45	379760	29.79
pleease note in this case it has not considerd more than 16 tons , even thought the option upto
19 tons is given to choose
if spindle installed  is increased by 10%
15 tons	60	35.5	90	20	20	225	49	398660	33.76
17 tons	60	169	36.7	0	20	225	49.5	416621	30.62
19 tons	0	349	0	0	0	221	49.5	429693	27.75
if grams/spl goes up by 5%  for 40sc
15 tons	60	109	25.3	0	20	236	45	386556	32.29
17 tons	0	284	0	0	0	226	45	398527	28.86
19 tons	0	393	0	0	0	177	45	407582	26.20
if grams/spl goes up by 5% for 20sc
15 tons	0	170	35.9	0	20	225	45	379457	31.49
17 tons	0	293	0	0	0	217	45	394340	28.53
19 tons	0	394	0	0	0	176	45	407251	26.18
PLEASE NOTE THAT WHATEVER CONCLUSIONS, STATEMENTS, OPINIONS ARRIVED AT BASED ON
THE ABOVE DATA IS APPLICABLE ONLY FOR THE SAME DATA.  CONCLUSIONS,  RESULTS MAY VARY
DEPENDING UPON THE PROUDCTIVITY OF DIFFERENT COUNTS, SELLING PRICE COMBINATIONS
FOR DIFFERENT COUNTS, OVERALL QUANTITY ETC
IF YOU WANT TO DISCUSS
PLEASE CONTACT
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