Developing a Pre-Production Price Forecasting Framework for a Small-Scale Apparel Factory
Mohotti, Rajitha (2025)
2025
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2025120833781
https://urn.fi/URN:NBN:fi:amk-2025120833781
Tiivistelmä
This thesis aims to develop a framework to forecast selling price before production for a small-scale apparel manufacturing company. The thesis was done for a Sri Lankan apparel brand who operates several small-scale production facilities and faces ongoing challenges in finalizing selling price before production due to material usage variations, manual costing routines and inconsistencies in the process. The study aimed at establishing a forecasting approach which is going to help the company to improve its accuracy and shorten the price confirmation process.
The thesis followed an Applied Action Research approach where the data was collected across five production sites through interviews, observations, workshops, document reviews, ERP checks and pilot runs. The current state analysis focused on the day-to-day operational difficulties, examined together with the ten stakeholders (five functional-area experts and five factory managers) in real-life operational conditions.
The theoretical framework of this thesis covered the topics such as cost forecasting, Activity-Based Costing (ABC) approach, managing material utilization and process standardization in the small to medium scale apparel manufacturing. This theoretical exploration resulted in identifying six cornerstone tools, namely a Fabric Parameter Register, a BOM Template, an Allowance Rule Sheet, a Marker Policy & Library, a Driver Dictionary and an RFQ Forecast Template. Together, these elements form a forecasting approach which connects material information, cutting process & practices and costing rules into one interconnected system.
The final outcome of this thesis is a ready-to-use forecasting framework developed to adopt in the current company infrastructure for improved data visibility, supporting more consistent costing practices and reducing delays in the final price confirmation. For the case company, this framework supports a structured way to connect procurement, cutting and costing operations while supporting them to make faster decisions, reduce the waste risk, and maintain more stable costing structure across all the production facilities.
The thesis followed an Applied Action Research approach where the data was collected across five production sites through interviews, observations, workshops, document reviews, ERP checks and pilot runs. The current state analysis focused on the day-to-day operational difficulties, examined together with the ten stakeholders (five functional-area experts and five factory managers) in real-life operational conditions.
The theoretical framework of this thesis covered the topics such as cost forecasting, Activity-Based Costing (ABC) approach, managing material utilization and process standardization in the small to medium scale apparel manufacturing. This theoretical exploration resulted in identifying six cornerstone tools, namely a Fabric Parameter Register, a BOM Template, an Allowance Rule Sheet, a Marker Policy & Library, a Driver Dictionary and an RFQ Forecast Template. Together, these elements form a forecasting approach which connects material information, cutting process & practices and costing rules into one interconnected system.
The final outcome of this thesis is a ready-to-use forecasting framework developed to adopt in the current company infrastructure for improved data visibility, supporting more consistent costing practices and reducing delays in the final price confirmation. For the case company, this framework supports a structured way to connect procurement, cutting and costing operations while supporting them to make faster decisions, reduce the waste risk, and maintain more stable costing structure across all the production facilities.