Price and Mode of Payment

Price and mode of payment should be clearly defined. Price is very important for both parties. Buyers wants that price should be as much low as possible and seller always want to maximize its portion. So the price should be decided carefully so that both parties can get good margin of profit.

On the other hand payment mode is also decided first. There are many ways of payment like advance payment, partial payment, LC payment etc.

5) Packing

Buyers define the packing style. Finished goods are packed according to parameters defined by the buyer. Different styles of packing are available and finished goods are dispatched according to requirement of buyers.

6) Shipment

The shipment schedule will be subject to the condition that the Seller is in possession of the Letter of Credit, within the time schedule, satisfactory in all respects to the Seller

7) Inspection

Where the finished goods will be examined and who will clear the shipment. Usually a certification of inspection provided by the quality checkers who provided the guarantee that the finished goods are free from faults and according to the required standards. So these terms should me clearly defined that who will test the shipment and where the inspection will be done how the claims will be settle.

Value Creating Process:

A value chain is a chain of activities for a firm operating in a specific industry. The business unit is the appropriate level for construction of a value chain, not the divisional level or corporate level. Products pass through all activities of the chain in order, and at each activity the product gains some value. The chain of activities gives the products more added value than the sum of added values of all activities.

How we create value through Primary Activities:

We know that all the activities adding some value to finished goods, so to create more value in our finished goods we will perform each and every activity with in this way that it adds some value to our finished item. How we create the value given below in detail:

 Inbound Logistics

Inbound logistics means the activity from receiving raw material from supplier, storing it in our warehouse and delivering it to manufacturing department. These activities are

o Transportation

All the raw material we purchased from supplier will be safely delivered to warehouse. We will prefer to contract with those suppliers who have availability of good quality raw material and also promise us to deliver raw material on our unit whenever we needed. When delivering supply will be supplier’s responsibility he will provide material with care and on time otherwise we will cancel contract with him.

o Material storage

Material will be stored in our store room and all the material will categorical arranged so that material will not be mixed up and can be easily picked up when it needed. In this way our process will fast and clear and easy.

o Communications

Production manager will regularly communicate with supervisors and store managers so that he can know the status of raw material available in the store. Our main objective is non stop production and we will strictly avoid that our production will stop due to shortage of raw material. On the other hand suppliers will be always in our contact and we will remain in touch with them to get rates of raw material and availability of raw material. Through our MIS system our communication between departments will very fast.

o Testing

Raw material will be very carefully tested by our quality inspectors and standard and quality will be tested. We will make sure that raw material will be 100% good so that our production can be satisfy our buyer.

 Operations

Second factor of value creating is operation. In operation phase raw material converts in finished goods. Our manufacturing process is very advance and according to the standards required by the top brands of the world. So how we will create value through our operations given below in detail:

o Process

Our work will be in defined in flow and we will use time management formula to do each activity. In this way we will be overcome on time wasting and our activities will perform efficiently. Our industrial engineers can also help us in this scenario to allocate time to each activity of production dep’t.

o Materials

High quality raw material will be use in production process. Local suppliers and also suppliers from the other countries will provide materials to us to complete our production with high quality and according to promised standards.

o Machinery

With the help of our new and advance machinery our production will be high quality which will meet the standards given to us by exporters.

o Packaging

Packing is the element in the operations process which adds more value to the finished goods. Our packaging staff will carefully pack the finished goods and the required packing parameters will be fulfilled to make our finished goods more attractive to the end user.

o Maintenance

Our machinery will be regularly tested from our machinery mechanics to ensure that the machine in given perfect results as required. With our proper maintenance to our machinery our production will free from faults and quality standards will be surely meet.

o Testing

Testing phase is very strict and carefully inspections of finished goods will be done to assure that the standards and requirements are fully achieved. When our production will carefully check definitely it will increase our value creates good name in the market.

 Outbound Logistics Technologies

Same like the inbound logistics outbound logistics are very important because we can successful to add value of all above given factors if the finished goods carefully and safely delivered to the buyers on the given time. Value creating factors from outbound logistics are given below and how we will use them efficiently to add more value given below:

o Transportation

Our transportation process will be very fast and we will definitely deliver orders on given time. Fast and quick transportation will be use and efficient distribution channels will add more value in the minds of our clients.

How to deliver finished Goods to End User:

There are three ways to deliver our shipments to our clients. Our main emphasize is on export and there are three methods can be used to deliver our finished goods to their end user. These terms are given below: