Pricing and Safety in a 60-Set Kurta-Pyjama Order
A home tailoring unit receives an order for 60 kurta-pyjama sets at ₹850 per set, delivery in 12 days. It has three tailors and one helper; normal output is 5 sets per day over an 8-hour day. Each set uses 2.6 m of 112 cm cotton at ₹110/m; thread and buttons cost ₹28; packaging ₹12; tailor piece-rate ₹140/set; helper ₹500/day; rent ₹1,200/week; electricity ₹350/week; maintenance ₹600/month. In the first 10 sets, 2 were rejected for skipped stitches and uneven hems. The unit's iron has a frayed cord and no earth connection; workers sit on backless stools for 9 hours. The buyer will deduct the full ₹850 price for every defective set and may cancel the balance of the order after two late deliveries. The owner must decide whether to accept, how to schedule, and what to fix before starting.
1. Prepare a cost sheet and calculate contribution per set, weekly break-even and profit on 60 sets before and after a 5% rejection rate.
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Variable cost per set: fabric 2.6 × 110 = ₹286; thread/buttons ₹28; packaging ₹12; tailor piece-rate ₹140. Total ₹466. Contribution at ₹850 = ₹384 per set. Fixed cost per week: rent ₹1,200 + electricity ₹350 + helper 500 × 7 = ₹3,500 + maintenance 600/4 = ₹150; total ₹5,200. Break-even = 5,200/384 = 13.54, so 14 sets per week. For 60 sets in 12 days: fixed = rent 1,200 × 12/7 = ₹2,057; electricity 350 × 12/7 = ₹600; helper 500 × 12 = ₹6,000; maintenance 600 × 12/30 = ₹240; total ₹8,897. Variable = 60 × 466 = ₹27,960. Total cost ₹36,857; revenue 60 × 850 = ₹51,000; profit ₹14,143. If 5% of delivered sets are rejected, the unit must make 63 sets to deliver 60: extra variable 3 × 466 = ₹1,398; profit ₹12,745. If the first-batch 20% reject rate continues, 72 sets are needed: variable 72 × 466 = ₹33,552; total ₹42,449; profit ₹8,551. The order is still profitable at 20% rejects, but the margin falls by about 40%, and the buyer may cancel after late delivery.
2. Can the unit deliver on time at 5 sets/day? Set out a capacity and quality plan for 12 days.
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At 5 sets/day, 12 days gives exactly 60 sets, with zero buffer for a holiday, power cut, machine breakdown or rejected set. That is not a plan; it is a gamble. The first 10 sets already produced 2 rejects, so the process is not capable at the required quality. Capacity plan: aim for 6 sets/day for the first 10 days (60 sets), leaving days 11-12 for rework, pressing, packing and any shortfall. Three tailors at 8 hours currently make 5 sets, so 6 sets needs about 9.6 hours, or a fourth operator, or the helper taking over hemming and trimming. Quality plan: find the cause of skipped stitches (needle size and point, thread tension, bobbin case, timing, fabric needles), change needles every 8 hours, test tension on scrap at each machine; for uneven hems, mark with a template and check foot pressure. Introduce in-line inspection after side seams and after hemming, not only final inspection. Keep one spare machine and a maintenance check before day 1. Record rejects daily; if rejects exceed 1 in 20, stop and fix before continuing.
3. List the safety and ergonomic actions you would take before starting, and explain the business case.
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Electrical: the frayed cord and missing earth are a shock and fire risk. Replace the cord and plug, have an electrician check earthing, fit an RCD, route cables away from the worktable and water, and keep the iron on a heatproof stand, never on the fabric or floor. Do not run the iron from a loose extension board. Ergonomics: replace backless stools with chairs that support the lower back, add a footrest, raise the table so elbows are near 90°, and give a 10-minute break every 2 hours with simple shoulder and wrist stretches; nine hours on a stool causes neck, shoulder and lower-back strain and reduces speed. Fire and first aid: a dry-powder extinguisher, a first-aid box, and a rule that no one irons alone. Business case: one accident can cost more than the order's ₹14,000 profit in medical costs, lost days and buyer cancellation; the buyer may also audit safety. Spend about ₹2,000-3,000 on the cord, earthing, chair and extinguisher, and include it in the cost sheet as overhead, not as a reason to refuse the order.