CHAPTER TWO

LITERATURE REVIEW

This chapter explains the literature review of this research. The purpose of this research is
identify different solution for the volatility if demand which is one of the major issue faced by
the supply chain department of salim winding works, from last 2 years. The uncertain demand of
some of core product affects the production of other products. Different types of models has been
discussed in the context of textile industry.

Demand Variation

[ CITATION Sar13 \l 1033 ]The purpose of this research is examine the tradeoff between cost,
capacity flexibility and other related factors in textile and fashion industry. In this research it was
analyze that conflict occur due to demand variation, lead time and many other risks. It was
identified that outsourcing strategies could bring flexibility and great cost benefits to the
company. Outsourcing of basic product textile product, critical product and sustainable with
large quantities is bring multiple benefits and cater customers demand timely and in efficient
manner.

(Wang et al. 2012) Due to the changing fashion trends and a volatile market situation, demand in
fashion and textile (FT) industry is unpredictable and could vary and change completely in a
short time, which makes it more difficult to coordinate a FT supply chain. A change in product
preference due to fashion trends is the main reason why the demand of FT industry shows more
variations than other industries. In this paper, a well-known contract, the all-unit quantity
discount policy (AQDP), to coordinate a FT supply chain with certain demand, and further
consider it under the demand variations scenario to investigate whether it can still coordinate the
supply chain. In detail, before the selling season, an AQDP is provided by the manufacturer to
the retailer, and under which the FT supply chain coordination achieved with a certain demand.

[ CITATION Sak13 \l 1033 ]The literature review suggests that the type of volatility in the supply
chains can be characterized by economic or macroeconomic volatility and demand volatility. The
supply chain of firms across industries is highly affected by the level of financial instability.
There are a variety of factors that contribute to such a breakdown and yet there is unprecedented
pressure on the way these companies source, manufacture and distribute their products. These
factors include rapid changes in the availability and price of key commodities, major currency
fluctuations, disruptive geopolitical events, and the continued growth of customer channels on a
global basis.

(Abolghasemi et al. 2019) Demand volatility due to promotion, In this 843 real demand series
were investigate to measure the fluctuation in demand caused by promotion. Hybrid model is
used in which demand is decomposed into baseline demand and promotional demand. The
results indicate that hybrid model give accurate results of volatility of demand series with help of
ARIMA model (Autoregressive Integrated Moving Averages) which provides significant
forecast uncertainty of demand series.

(Mazedul et al. 2013) Critics argue that the textile industry has obsolete equipment and
machinery. The inability to timely modernize the equipment and machinery has led to the decline
of Bangladesh textile competitiveness. Due to obsolete technology the cost of production is
higher in Bangladesh as compared to other countries.

[ CITATION Fel151 \l 1033 ]To maximize the expected benefit a two-stage linear stochastic
programming technique is used. Decisions such as the quantity of output, the inventory level of
finished and semi-finished goods, the quantity of backorder and the quantity of products to be
transported in each cycle between the upstream and downstream plants are considered and
evaluate the robustness of the manufacturing supply chain.

Lean Manufacturing

[ CITATION Sal12 \l 1033 ]This case study applied on south India's textile industry. While the
principle of lean manufacturing has shown strong results in continuous process industry.
Processing industries, particularly textile industries, have highly inflexible, high volume / low
variety of products. This aspect of the textile industry enables the implementation of lean
manufacturing techniques a challenge; hence, it has been taken up as a challenge to incorporate
lean techniques in a textile market. To strengthen the processes, the combination of value stream
mapping (VSM), 5S, kanban, kaizen, poka-, and visual controls. The findings of this study show
that a comprehensive review of the operation, set-up and changeover time (CO), the use of color
coding for volume-mix classification, the use of kaizen and the quality circles that motivate the
workforce are some of the different keys to an effective lean implementation in a textile sector.

Performance Measures of Supply Chain

[ CITATION Cha15 \l 1033 ] Selection & analysis of appropriate performance measures is

(Craig. B, 2019) Using the ABC System, we can accurate forecast and analyze the market
demand and trends carefully and precisely make forecasts to keep control on inventory levels.
Prioritize items, segregate and optimize. Class A: 5-15% of all inventory items account for 70-
80% of the total dollar value of inventory, Class B: 30% of total inventory units, 15% of total
inventory dollar value and Class C: 50-60% of inventory units, 5-10% of total dollar value the
higher the value of the inventory, the tighter the control. With this concept in mind, Class A,
which holds the highest total dollar value of inventory percentage, would need the tightest
control on reduced inventory levels. Since Class B and C make up a significantly less portion of
the total dollar value of inventory percentage, they require less strict inventory control.

Supply Chain Management Uncertainties

Gangadharan (2007) suggest that s dynamic environment, such economic instability can be used
as a competitive advantage. It is clear that the main features of internal supply chain instability
are changes in demand and supply. In other words, the volatile market that companies are facing
nowadays is forcing executives to make their companies' capabilities more agile, which turns
instability into an opportunity rather than a threat. They need to find areas that create this
financial instability and their business is likely to survive in the markets. Here are some
strategies to help manage volatile demand in supply chains.
[ CITATION Das09 \l 1033 ] This paper investigate the different factor that causes the uncertainty in
textile supply chain which includes supply uncertainly, New fashions and trends, government
policies and taxation. Supplier redundancy, inventory placements, fluctuating cost of raw
materials and equipment failure. The research emphasize on different strategies and solution
such as traditional forecast system is not responsive to dynamic fashion it should be shift the
quick adaptive systems. Change forecast driven planning to market driven and customer
preferences and fashion trends are to be taken into account planning and design stages.

[ CITATION Tia11 \l 1033 ] The purpose of this paper is to investigate the coordination between
apparels supply chains under lead time and demand uncertainty. This paper identified model the
impact of the lead time on demand uncertainty and consider that the supply chain can be
managed by a markdown money coordination and change profit. When the lead time rises, the
supplier would charge a lower unit selling price to the retailer to stimulate demand and charge
high price to control demand if the quantity in significantly large. The shorter lead time will
effect high cost for manufacturer sometime manufacturer cut down lead time to get rid off
leftover

References
Charkha , P., & B. Jaju, S. (2015). Identification of Performance Measures for Textile Supply Chain: Case
of Small & Medium Size Enterprise. International Journal of Supply Chain Management.

Abolghasemi, M., Gerlach, R., Tarr, G., & Beh, E. (2019). Demand forecasting in supply chain: The impact
of demand volatility in the presence of promotion. Australia.

Dash, M., & Nalam, S. G. (2009). Managing Uncertainties in Textile Supply Chains.

Felfel, H., Ayadi, O., & Masmoudi, F. (2015). A stochastic programming approach for a multi-site supply
chain planning in textile and apparel industry under demand uncertainty. International Journal
of Supply and Operations Management, 925-946.

Sakty, K., & Osama, E. (2013). Improving Supply Chain Performance Using Volatility, Uncertainty,
Complexity and Ambiguity (VUCA) Drivers . Arab Academy for Science and Technology.

Saleeshya, P., & Raghuram, P. (2012). Lean manufacturing practices in textile industries. Int. J.
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Sardar, S., & Lee , Y. H. (2013). ANALYSIS OF OUTSOURCING STRATEGIES FOR COST AND CAPACITY
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Xiao, T. (2011). Coordination of a fashion apparel supply chain under lead-time-dependent demand
uncertainty. The Management of Operations, 257-268.