KPI stands for Key Performance Indicator or Key Points Indicator. This is the era of competition and we have to survive with global challenge in apparel industry. If you carefully work with Key points that is KPI Factors of Garments then surely Garments business will flourish. Management team should focus on KPI for their industry. KPI report will help you to look into the actual condition of your garments.
KPI Factors of Garments
There are many KPI factors which are directly and indirectly related with garments, specially in factory operations.
KPI for Garments Cutting
Cutting efficiency: Cutting efficiency one of the most important factor. If efficiency increase in cutting section, then production will increase by using minimum number of manpower.
Cutting delay/Input delay in sewing line: Sometime cutting and sewing not start as per plan. Only two reason behind this. If PP/Size Set or pilot run sample fail to buyer QC to meet quality standard, apparel manufacturers have remake sample and submit again to buyer QC to pass sample and get cutting approval. Sewing can be delayed for Trims and accessories delay receive from supplier.
KPI for Sewing
Line wise Sewing efficiency: Sewing make the whole garments, so sewing efficiency is an important factor for garments industry.
Efficiency calculation: An operator was doing an operation of SAM (Standard Allowed Minute) 0.60 minutes. In 10 hours day he produces 600 pieces. So according to the efficiency calculating formula, that operator’s overall efficiency is as follows:
Efficiency (%) = [Total minute produced by an operator/Total minute attended by him *100]
Efficiency (%) = [(Total piece made X SAM of the operation)/ (Total working hour X 60) * 100]
= [(400 x 0.60) / (10 X 60)*100%]
The ratio among production/hour/manpower/machine is to be optimal. Every factory has self study to reduce manpower, keeping less helper with best possible production outcome.
Machine Trouble/Machine downtime: Because of Machine trouble production is stopped. Machine maintenance department have to do their best effort to reduce machine downtime. Electrical problem also can be cause of Machine trouble/machine downtime.
DHU in Sewing: Defects rate also key point in garments manufacturing. Factory has to rework for repairing defects. Defect generation reduces operator’s efficiency. Factory wants to keep defects as low as possible for per hundred units.
Absenteeism: Operator absenteeism hamper sewing production, create bottleneck. Every factory target employee absenteeism rate is zero % but sometimes it may not possible to keep this percent.
No. Style change: Style change effect on productivity, efficiency, and quality. So garments manufacturer wants big lot order more rather than small quantity order for any lot.
Plan vs Actual Production Ratio: All factories have planning department to make plan for cutting, sewing, finishing and shipment to meet buyer required shipment date. Gap between plan and actual production is the reason of not meeting on time delivery.
Idle Time/Machine: Idle time is also known as loss time. For any type of reason operators are not working is considered as loss time. Common reasons for idle time are; using new layout, machine trouble, no work etc.
Operator Wise Efficiency: The best way of efficiency calculation is to calculate individual operator efficiency every day, show report weekly and train up lower efficient operator for improvement which ultimately increase the operator efficiency.
Process improvement: Industrial engineering (IE) department do time study, motion study and work study to find out SMV (Standard Minute Value), to minimize unnecessary motion for sewing operations. By this way factory save SMV time for garments manufacturing.
Operator Turnover Rate: Since sewing is the key process of apparel, sewing operator turnover percentage is important. Turnover means the number of employees got fired or left from the job and replaced in work place by new operator. If turnover rate is lower in factory then it will be better for the company.
Monthly turnover % = (Employees separated/Average number of employees during the month) *100
Example, If Employees separated = 21, Average number of employees during the month= 950
So, Monthly Turnover % = (21/950) × 100 = 2.21%
KPI for Trims and Fabrics
Claim Amount vs. Recovery Amount: According to the buyer quality standard, garments manufacture has to reject fabrics, trim if there is any quality issue. So, maker must claim for compensation by replacing or giving back their money.
KPI for Finishing, Final Audit and Shipment
Cut to Ship Quantity: As PO wise buyer order quantity cutting department try to cut extra as much as possible. It could be from 2% to 5%. GMTS reject due to different quality issue. Below data will give idea about GMTS (Garments) production flow.
Reject percentage: For some critical quality problems like wash damage, measurement out of tolerance, work hole and unrepeatable problems GMTS rejected by finishing quality team.
DHU in Finishing: Defects rate also key point in garments manufacturing. Factory has to rework for to repair defects. Finishing team have to repair whatever defect come from sewing or finishing they found. Factory wants to keep defects per hundred units as low as possible. If too many products are defected then to rework the garments may add extra cost to the product which to totally unexpected.
Final Audit Pass rate: Final Audit pass rate is the number 1 KPI factor for Garments Quality. For some buyer final audit, if fail once any PO in final Audit, Factory has to give penalty for that. Any PO fail in final audit, factory has rechecked full quantity goods again. Could imagine how much cost need to recheck, and it also does hamper running production as well.
Finishing Production: Finishing is the last step of apparel manufacturing. On time delivery, sea or air shipment mainly depends on finishing of production.
Finishing Efficiency: Finishing efficiency is also very important key factory. If efficiency increases, production will increase with minimum manpower and ultimately it will increase profit for the company.
Order and Ship Ratio: Order and ship ratio should be equal at least or ship quantity could be more than order quantity since cutting quantity is more than 2% or 3% of order quantity by reducing reject %.
Air Ship Quantity: Two reasons are cause for air shipment. One, If Garments maker cannot meet on time delivery date then maker have to ship goods by air at his own cost. GMTS suffer huge financial loss for air shipment because the rate is more for air shipment. Number two would be merchandising reason for not sourcing raw material on time.
Templates and KPI Dashboard Presentation
You may need to present your factory KPI data with Top management or may need to report them. Here I am sharing you a complete presentation and Excel database for your convenience for free. I hope these would help you to work with KPI smoothly.
A.M. Amirul Islam (Washim)
E-mail: [email protected]