Operational Analysis of Pak Argo Packaging Ltd.

Abstract

Small and Medium Enterprises (SMEs) are considered to be the engine of an economy as they contribute significantly in the country’s GDP and are a big source of employment generation. Currently there are more than 5 million SMEs in Pakistan that contribute 40% of the country’s GDP and 25% in overall exports. The focus of this business project also revolves around one such SME called Pak Argo Packaging Ltd. (PAPL) that is based in Phase IV, Hattar Industrial Estate, KPK, Pakistan. PAPL is Pakistan’s pioneer and forefront company engaged in manufacturing of agricultural textile products. It’s primary product Greenhouse Shade enjoys a 50% market share and its production and related operations shall be the emphasis of this business project. A comprehensive operational analysis for this product was done for PAPL in which process flow charts for production of Greenhouse shade were prepared, accurate forecasting techniques were incorporated to predict month wise demand for 2023, plant’s current production capacity was evaluated, raw material’s inventory management progression was developed and the control limits, sigma level and the capability of the production process was assessed. The operational analysis concluded that PAPL’s current plant’s production capacity is not sufficient to meet the forecasted demand of Y2023 and a shortfall of 72,155kgs would be observed. An addition of a Raschel Knitting machine was proposed in which an investment of PKR 17.5M is required and the payback period for this investment would be four years. Increasing productivity for SMEs is extremely important and for that it is highly recommended that an operational audit of their production operations is conducted annually so that market demand is met every time.