Profit optimization of a textile industry in Bangladesh using linear programming

Abstract

The research deals with profit maximization of a Textile Industry by Linear Programming (LP). Linear Programming, an operation research technique is widely used in finding solutions to complex managerial decision problems. In this paper, the Linear Programming model is built by taking considerations on market segmentation, interest of workers, utilizations of machines and other resources, demand of products by forecasting and production capacity of the company. In order to validate and calibrate the model, real data from a textile industry named Rozha Textiles Ltd. have been collected. Textile industry is one of the most feasible business options owing to the straightforward manufacturing process involved starting a cloth manufacturing business in Bangladesh.

In this dissertation, it is considered Linear Programming Model to maximize the profit at level best in the textile industry. This study can optimize profit of several types of cloths. This research used AMPL programming language to maximize profit mathematically using a standard Linear Programming model. Labor cost, machine cost and other cost have also been taken into consideration. Then using these data, a Linear Programming Model is formulated. In this Linear Programming, objective function is to maximize profit. Labor cost, machine cost and other cost are considered as subject to constraints. After that, the Linear Programming is solved by using AMPL. Sensitivity analysis that helps the company to improve their business policy are carried out on cost parameters. The industry will be able to see how any change can affect the profit. From the numerical results, it is clear that fabric cost and machine cost are the most sensitive cost. If the fabric cost and machine cost can be decreased, the profit will also increase. Finally, the result of the optimal solution will be represented in tabular form in addition to the graphs.