Stitching the Plan: Aggregate Production Planning at Central Loom Apparel

Central Loom Apparel Pvt. Ltd. (Central Loom), a medium-sized apparel-manufacturing firm based in Nagpur, India, produced various types of casual wear in the mid-to-premium segment for a variety of clients including schools, colleges, companies, and event organizers. The company was known for its speed, reliability, and quality, and this reputation was key in an industry with short lead times and volatile demand. In December 2024, Central Loom’s founders were at a crossroads as their company entered a phase of increased order inflows and uncertain seasonal fluctuations that would strain their existing production capacity. They needed to establish a six-month production plan that would satisfy this demand at the lowest possible total cost while being cost-effective, avoiding a reliance on undue levels of overtime or subcontracting, and enabling the company to ensure on-time availability, which was paramount to sustaining its positioning and market share. The company had three production options: (1) continuing with regular production, (2) expanding to overtime production, or (3) relying on subcontracting. The founders needed to decide when to apply the more costly production processes—expanded in-house production or outsourcing—and when to go ahead with producing items in house ahead of schedule and carrying inventory. The decision would have significant implications in terms of costs, quality, and staffing.