pel final ir - copy

PEL

NATIONAL UNIVERSITY OF MODERN LANGUAGES

DEPARTMENT OF MANAGEMENT SCIENCES

LAHORE CAMPUS

FINAL INTERNSHIP REPORT

Pak Elektron Limited Project of NUML

Submitted By Zahid Zamir

Roll No Lc-2112

____________________________________________________

Master of Business AdministrationSession January 2009 to December 2012

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Pak Elektron Limited

Project of National University of Modern Languages Lahore

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National University of Modern LanguagesFaculty of Management Sciences

It is hereby certified that the report has been thoroughly and carefully read and recommended to

the Faculty of Management Sciences for acceptance of final internship, by Zahid Zamir Roll

No.LC-2112, Session (Jan 2009 to Dec 2012) Morning, in partial fulfillment of the

requirements for the degree of Master of Business Administration of National University of

Modern Languages Lahore.

Supervisor Name _________________

Supervisor Signature _________________

Panel Members Name _________________

Panel Members Signatures ________________

Head of Department ________________

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TABLE OF CONTENTS

TITLE PAGE PAGE NO

LETTER OF TRANSMITTAL iviv

iv

ACKNOWLEDGEMENT iv

ivEXECUTIVE SUMMARY iv

Chapter # 1: INTRODUCTION OF ORGANIZATION (PEL) 01

1.1 Introduction of the PEL 02

1.2 Historical Background of PEL 06

1.3 Vision of PEL 08

1.4 Mission of PEL 08

Chapter # 2: PRODUCTS & SERVICES of PEL 09

Chapter # 3: DEPARTMENTS OF PEL 15

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Chapter # 4: PERSONAL EXPERIENCE 21

Chapter # 5: ANALYSIS on PEL 25

5.1 SWOT Analysis 26

5.1.1 Strengths 26

5.1.2 Weaknesses 26

5.1.3 Opportunities 27

5.1.4 Threats 27

5.2 PEST Analysis 28

5.2.1 Political 28

5.2.2 Economical 28

5.2.3 Social 29

5.2.4 Technological 30

Chapter # 6: SUGGESTIONS & RECOMMENDATIONS 32

Chapter # 7: CONCLUSION 37

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Letter of Transmittal

Head of Management Sciences Department

National University of Modern Languages

Lahore Campus

Respected Sir,

It is to present you the internship report which was executed at Pak Electron

Limited to fulfill the requirements of BBA (HONS) degree program. This report

is arranged according to the guideline given by the department. It was my first

professional experience. During internship I applied the knowledge that I gain

from NUML. Through this report I introduce the Pak Electron Limited, its

working structure and products, detail of my working and learning from that

company and impact of internship on my career in future. I have tried my best to

explain the experience and knowledge that I have gained from internship, to

make this report inclusive to meet the reader’s expectations.

Regards,

Zahid Zamir

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Acknowledgment

I have discovered a responsibility in me to learn from others that has shaped my

life. The work with some unidentified people makes life easier every day. I

think it is a proper way to recognize all these strangers and those people who are

close to me and have directly shaped my life during my work. First, I want to

express my gratefulness to my parents for their persistent provision and

encouragement which I received during my career. I have a great depth of

thankfulness to all my teachers for their treatment and helping approach during

my stay in the institution. I would like to thank them for his great help in

carrying out my duties. I would like to express my appreciation to people who

help me personally during the course of my studies. Last but not utmost, it

forces me much to acknowledge those who helped me to get the knowledge of

the marketing and support me constantly during my internship program.

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Executive summary

Pak Electron Limited (PEL) is a standard of Saigol group of companies.

Products manufactured by PEL always been the high level and the name (PEL) is

symbol of excellence throughout the Pakistan. Since its beginning, the company

has been working for the development and progress in Pakistan. The PEL has

produced hundreds of engineers, skilled workers and technicians through its

internship and training programs. The company consists of two divisions: The

first one is Appliances Division. This division consists of manufacturing the

specific appliances like refrigerators, microwave ovens, washing machines etc.

The second division of PEL is the Power Division. PEL Power Division consists

of manufacturing high-power electrical equipment like energy meters,

switchgears and transformers etc. And these are supplied to WAPDA and KESC.

In 1980 the company prolonged into consumer products with the introduction of

window air conditioners and today also the split AC, refrigerators, freezers,

compressors and microwave ovens .PEL products from the beginning have been

of the highest standard and the name PEL is synonymous quality throughout the

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Pakistan. Since its beginning, the company has been acting as an institution that

works for the promotion and development of knowledge in Pakistan.

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Chapter # 1

Introduction of

Pak Elektron Limited

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INTRODUCTION OF PEL’S BUSINESS

PEL is one of the oldest manufacturing units of Home Appliance in

Pakistan. PEL products are produced of extraordinary quality and have

been introduced over the years. PEL was established with the partnership

of Technology AEG Germany in 1956. In 1980 PEL prolonged their

business into consumer domestic market with introduction of window AC.

In October 1978, PEL was attained by the Saigol group of companies. PEL

has continued on the track of regaining of business, both in power and

electrical divisions. Efforts to increase efficiency, product quality and

expansion have produced the positive results. While increasing business

capacities that need surplus working capital have legitimate much and

ease their cash flow, which could offer horizontal operations. Business in

the Energy Division is endorsing confident and is estimated to develop

more in the years certifying. PEL is travel around the export market for

our food products division. The Crystal brand refrigerator launched in

1998 has become a captain source of our persistent development. This

movement is expected to endure in the upcoming years. Furthermore air

conditioner sales have not grasped the required ranks due to some severe

fault in import processes and smuggled goods, the contraction in the size

of the labor market and capital controls. In order to get reliability,

customer base company is moving towards a strategy of diversifying its

product. As a result Appliances Division is being strengthened by which

the marketing grid has extended with a focus on setting up the sales team


PEL

and dealer network. 3S concept introduced above, is working effectively

in our service network. Exceptional devotion is being given to going up

the variety of products introducing fresh models, sizes and colors.

Demand for appliances and particularly refrigerators which are emergent

at a speedy level has improved mostly by the increasing role of consumer

financing through financial institutes and estimated schemes which are

attained by retailers.

POWER DIVISION

Products manufactured in the power division are transformers, energy

meters and switch gears. Business in this division has suffered seriously

in recent years due to problems in absorptive WAPDA and KESC. The

theft up gradation neediest WAPDA distribution was introduced by the

new administration. The production of energy meter single phase and

three phases are moving toward a finest level. The plans to improve

productivity and quality of our meters are also in growth. Our actions to

supply distribution transformers for WAPDA have recently taken a

significant enlargement. Subsequently, PEL is planning to increase our

production volume of transformers through improved methods of

production processes with the use of labor, product modernization and the

process of re-engineering. We are waiting to get the level of production

capacity of 2,000 transformers per year. A break in the business through

switchgear has been attained. PEL has successfully supplied a large order

of WAPDA switchgear against international bidding. Since all the


PEL

activities of the Energy Division are conducting against international

tenders or advances, the chronic problem of late payments has also been

resolute.

APPLIANCES DIVISION

Business in the appliances division has shown mixed trend but the

company is finally on the perfect track. Refrigerator glass with smooth

design and Dan Foss compressor with certification of compliance with

Dan Foss Germany was launched in February 1999. This has been very

well received in the market and our refrigerators sales have been

increased. This trend is expected to continue in the coming year as a

result of the company's innovative approach to product development,

along with forceful marketing strategy. Freezer experienced and certified

by Dan Foss Germany and value-added aesthetics has also been well

received by the market. We have been supplying our Deep Freezers to

Coca-Cola International and Lever Brothers and intend our attention on

institutional sales of this product. Sales of window air conditioner is

about the same level as last year, but have not reached the desired level

with pressure on prices and exchange rates are caused the losses to back

up PEL Limited. The core cause for this situation is a massive arrival of

imported products in addition of smuggling supply of air conditioners. It

is estimated that after terminating old stocks of smuggled goods have been

drained and fresh supplies are not permitted. The company to compact

with the above situation has boarded on a major plan to improve product


PEL

quality, expand product range, introduce energy proficient models, add

competitive features such as remote control, added filters, and to improve

the product creatively. After continuous struggles in recent years PEL

have been able to develop a new variety of models with the brand names

of "energy saving". Cooling and balance of this machine is experienced

and certified by U.S. Copeland. This has received a very optimistic

response from the market because of its energy proficiency savings,

cooling, low noise, compact size and features friendly character. PEL

expects that the company will make breakthrough the capacity of energy

savings as we have done effectively in the case of Cristal brand

refrigerators. It also a great exercise that is being done to decrease

material costs and improve the manufacturing process. Technical support

of international companies and foreign laboratories made this goal to

much energetic.

PEL APPLIANCES LTD

Freezers and window air conditioners are subsidiary products.

Optimistically, PEL Appliances Limited will travel to a recovering

condition in the following years.

PEL DAEWOO ELECTRONICS LTD

Contract for converting Sony television plant was finalized and PEL has

started production of its products since May 1999. Under this setting up

television equipment are supplied to us by Sony and then these necessaries


PEL

are renewed into television and are marked through its own system. TV

tariff structure has been reorganized in the federal budget for 2001-2002

and as a result blessedness of locally enlarged televisions has upgraded

significantly. Sony aims to take full advantage of this situation and

capacity of locally assembled televisions resultantly is estimated to

increase miscellaneous. Agreement for the makeover of the flat screen TV

has been finalized and excellently started production in September 2000.

HISTORY & BACKGROUND

Pak Elektron Limited (PEL) is the innovator manufacturer of electrical

appliances in Pakistan. It was established in 1956 in mechanical coalition

with AEG of Germany. In October 1978, the company was recognized by

the Saigol Group of Companies. At that time, the company was

manufacturing only transformers and circuit breakers. With Saigols in

supervision, PEL initiated increasing its product range by entering into

the manufacturing of air conditioning. In 1981, the company started to

manufacture window air conditioners. In 1987, while expanding the

product assortment further, the company started to manufacture

refrigerators and freezers. In 1988, a subsidiary company was established

which is called the (PEL Appliances Limited). In 1992, the product

variety again prolonged and company start to manufacturing energy

savers. In 1993 it established a joint venture with (Daewoo Electronics

Limited) of South Korea to manufacture the color televisions. PEL is one

of the prominent manufacturers of electrical products in Pakistan,


PEL

concentrating on consumer and engineering sections. The company has a

resilient presence in the power equipment market and is well recognized

in the appliance market. The Energy Division mainly manufactures

transformers, energy meters and circuit breakers and is a prominent

supplier to WAPDA and KESC and commands a market share of

approximately 36% in transformers, 35% of energy meters and 34% in

switch gears. These actions are based on the allocation of orders by

WAPDA, KESC and deliveries to private consumers. The PEL Appliances

Division has a resilient position in the local market of home appliances,

specifying in refrigerators and air conditioners, with an expected market

share of 28% and 10% correspondingly. In the last five years, the

companies have made the substantial improvement to increase the sale

through product modernization, competitive prices and a durable

distribution set-up. The industry of consumer durables has recently

experienced prompt growth in demand compelled by low commodity

prices, the introduction of consumer finance initiatives, low interest rates

and the purchasing power of consumers has improved. In the same way,

the construction movement in the country and upgrading of the set-up of

the WAPDA and KESC are the main drivers behind the growth of food

industry equipment. PEL is in healthy position in development of

consumer appliances and power equipment markets. The question is to

certificate that PEL should finance their advance needs. Both subsidiaries

namely (PEL Appliances Limited (PAL) and PEL Daewoo Electronics


PEL

Limited (PDEL) had be merged into PEL through the decision of

Resolutions by the Honorable High Court, Lahore. Since its beginning, the

company has always been contributing to the advancement and expansion

of the engineering sector in Pakistan by introducing a range of excellent

electrical utensils and appliances and by producing hundreds of engineers,

technicians and skilled workers through their internship and training

programs.


PEL

Mission Statement

Providing quality products and services for the customer

satisfaction to maximize profitability for all stakeholders through

the finest use of possessions.

Focus on the personal development of our human resources to meet

future experiments through good governance, corporate values and a

safe working environment with a strong wisdom of social

responsibility.

Vision statement

To excel in providing engineering goods and services through continuous

improvement.


PEL

CHAPTER#2

Products & Services

Of PEL

Products & Services of PEL


PEL

The company comprises of two divisions:

Appliances Division

Power Division

Products of Power Division

The Power Division of PEL has following products;

EPC Contracting

Power Transformer

Distribution Transformer

Dry type Transformer

Energy Meter

Switch gear

Transformer Services

Appliances Division

Business in the appliances division has shown mixed trend, but the

company is finally on track. Crystal Fridge with aerodynamic design and

Dan Foss compressor with compliance authorization Germany was Dan

Foss launched in February 1999. This has been very healthy received in

the market and our refrigerator sales have shown an increase of 125%

since 1999. This trend is expectable to continue in the upcoming year as a

result of the company's innovative methodology to product improvement


PEL

with marketing strategy. Deep an aggressive freezer experienced and

licensed by Dan Foss developed aesthetics Germany and has also been

well received by the market. PEL has been supplying our Deep Freezers to

Coca-Cola international and lever Brothers and aim to continue our

attention on institutional sales this product. Sales window air conditioner

is not closely on the same level but have last year reached the desired

level with a pressure on prices and the impact exchange rates causing

increased losses of the subsidiary Appliances Limited PEL. The main

cause for this condition is an enormous coming of imported products as a

result of the change in the assessment recorders that allow during prices

imports and under-charging. In addition, smuggling supply air

conditioning also persistent after the announcement by the Government to

execute such activities controls on. It is estimated that after terminating

old stocks of smuggled goods have been bushed and other supplies are not

certified. The company to deal with the above circumstances has get on a

key plan to increase product quality, expand product series, introduce

models power effective, adding competitive sorts such as remote control,

filtered added and to improve product aesthetics. After continuous efforts

in years the recent PEL have been able to develop a new range of models

from Energy Saver under the name. "Cooling and this machine balance is

tested and certified by U.S. Copeland. This has very positive received a

response from the market because their savings from energy efficiency,

cooling, low noise, compact size, features friendly character. PEL expects


PEL

that the company will make a development in the amount of energy

savings as we have successfully performed in the case of the addition of

Crystal Refrigerators. In mark being a great workout to do to decrease

material costs and improve manufacturing process. Technical support and

know how being acquired international companies and foreign laboratories

for achieve this goal.

PEL APPLIANCES LTD.

Freezers and window air conditioners are subsidiary products of PEL .Its

Appliances Limited is predictable to grow in healthier situation in

following years.

PEL DAEWOO ELECTRONICS LTD.

Agreement for converting Sony television plant established and PEL has

started production of its products since May 1999. Under this

prearrangement TV kits were supplied to us by Sony and renewed

televisions are distributed to them and markets through its own network.

The conversion price of $ U.S. called by us is charged attached televisions

every fortnight.

TV bill structure had been reorganized in the federal budget 2001-2002

and as a result of locally assembled televisions inviolability has

considerably improve. Sony intends to make the most of this volume

situation and of locally assembled televisions is expected to increase

resultantly collectors. Agreement for the conversion of flat screen


PEL

television has VEGA also resolved and we have started production

successfully In September 2000.

Appliance division has following products;

Refrigerators

PEL’s refrigerators are available in 6 series of different colors, models, prices, and

capacities. The series are as follow

Expression Series

Premier Series

6-Series

Deluxe Series

Smart Series

Mini Series

Air Conditioners

The air conditioners are available in three types;

Split Air Conditioners

Window Air Conditioners

Floor Standing Air Conditioners

Microwave Oven


PEL

PEL also introduced series of furnace models "Silver PEL line"

Microwave. PEL offers 26 different oven models with different prices,

models and dimensions.

Washing Machine

PEL’s washing machines are available in different models. The series are

as follow;

Magic Clean PWM7700

Magic Clean PWM512

Water Dispensers

PEL also introduce water dispensers. The main objective of introducing is

to increase its product line and provide value to customers.


PEL

CHAPTER # 3

Departments Of

PEL

Departments of PEL

Departments

There are 6 major depar tments in PEL which are as fol low:


PEL

1. Market ing Depar tment

2. Finance Depar tment

3. Product ion Depar tment

4. Human Depar tment

5 . Adminis t ra t ion Depar tment

6. Research &Development Depar tment

1. MARKETING DEPARTMENT

This depar tment i s control led by the Managing Director . Then fur ther

down the hierarchy are :

Brand Managers .

Credi t Dis t r ibut ion Manager .

Customer service agents .

Ins t i tu t ional sa les manager .

There are s ix branches of PEL in Pakis tan.

They are in charge of Regional Sales Manager (RSM).

Pol ic ies suggested by the sa les off ice for the whole region. The

customer service pol ic ies are def ined by the Customer Service Manager

of the off ice . The object ives are given to regional sa les manager of

each par t icular region and addi t ional object ive are performed by the

RSM and sa les agents to achieve the demand.

In Lahore , th is depar tment i s use up by these people who are as fol low:

RSM


PEL

Sales Area Manager

Sales Execut ive

This depar tment controls the 4Ps of market ing l ike product , pr ic ing,

Placement and promot ion. They are a lso responsible for the

modif ica t ion and modif ica t ion of the var ious brands of the company

and new products . They may recommend changes in color and s ize of

product that i s being used by customers . They t ry to in t roduce

modernizat ions in products to make them eye-catching for customers

and to compete wi th compet i tors Dawlance, Waves e tc . There are pr int

and e lect ronic media for ac t ive suppor t the idea .

2. FINANCE DEPARTMENT

The depar tment i s organized by the Chief Financia l Off icer . The main

responsibi l i ty of the f inance depar tment i s to provide funding in

accordance wi th the company pol icy for d i f ferent depar tments

according to thei r need and susta in f inancia l budget for each

depar tment independent ly . Al l purchases are made wi th the f inance

depar tment ; th is depar tment i s d ivided in to three sect ions:

Finance

Accounts

Credi t Control

( i ) Finance


PEL

Finance deals wi th Banks

( i i ) Accounts

Accounts are deal wi th the cost ing system, bi l l ing, operat ions

management and in ternal audi t .

( i i i ) Credit Control

This sect ion of the f inance depar tment handles credi t and

recovery procedures .

3. PRODUCTION DEPATMENT

This depar tment handles the manufacture of products . This depar tment

i s g iven by the object ives of senior management to produce a number

of products that are determined by past sa les data and market

condi t ions . This depar tment i s responsible for qual i ty control , so for

example we see that there are no defects or def ic iencies in any product .

In abroad, i t i s a habi t to implement new technologies and to keep up

to date on any new machinery or o ther equipment to get a bet ter

product performance. After the manufacture of a new product , i t i s

t ranspor ted to Germany for technical assessment for Dan Foss

Company. After author izat ion of the same, then i t s major i ty product ion

is s tar ted.

4. HUMAN RESOURCE DEPARTMENT

This depar tment uses the fore ign employee se lect ion cr i ter ia i .e .

d i f ferent se ts of guide l ines for se lect ing employees . After se lect ion of


PEL

the employees but a lso provide t ra ining and improve thei r ski l l s . The

head of human resources depar tment ca l led Human Resources Manager .

FUNCTIONS

Recrui tment

Select ion

Tra ining

Transfer

F i r ing decis ions

Labor Affa i rs

S taff Welfare

Human resource planning for the next f ive years .

5. ADMINISTRATION DEPARTMENT

The main responsibi l i t ies are :

Maintenance Suppor t

Maintenance of Pr inciples


PEL

Inspect ion of the mater ia l in and out of the fac tory

Maintenance Factory

Assis t a l l depar tments about mater ia ls

6. RESEARCH & DEVELOPMENT DEPARTMENT

This is the most important department regarding the future of the company

as a market leader in this department is continually in touch with the

market to meet customer preferences and product specifications. After a

thorough analysis of customer expectations then this department gives its

recommendations to senior management for changes in the product for

market success. This department conducts market surveys to obtain

information. This department is also responsible for bringing new

technologies into products.

CHAPTER # 4NATIONAL UNIVERSITY OF MODERN LANGUAGES Page 21

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Personal Experience

Personal Experience

My knowledge of Marketing and Advertising helped me while doing

internship. I learned a lot during this activity that how much important it is

to organize the things in proper manner, sending advertising material

(posters, stickers, wobblers, buntings, banners etc.) and letters or

Notification to all area sale offices of PEL. Arbitrarily calling existing

customers in different areas of Pakistan and asking them if they were

gratified with the product they purchased, and then make a customer


PEL

satisfaction report. Preparation of monthly report 0f Sales Plan vs. Actual

Production.

Visit to Lahore sales office in order to get the information regarding

PEL competitors.

Preparation of the comparing report of competitors and world well-

known brands in order to make easy to compare and know the strength

and weaknesses of PEL home appliances.

Preparation of daily sales and collection report.

I participate with our Print Media manager and select the price tags

which have circulated all over Pakistan in PEL presentation and whole

sale centers.

New Things Learned

Some of the new things I learned here were which are as follow:

How to work both individually and in groups in a stress-free and

tense condition.

Working under the command of someone.

How to manage the business while introducing new products.

Tolerance is very important in relationships, like anger can lose

your customer.

To increase sales and stay competitive with the best brands that is

necessary to keep their dealers happy by giving them incentives.


PEL

How to consolidate with other sales areas of PEL by phone / fax.

How to deal with customer complaints, so of satisfy them.

How to manage promotional materials.

How to manage time for several instant tasks in hours.

How to bring about communication between different departments .

CHAPTER# 5

Analysis Of


PEL

Pak Electron Limited


PEL

SWOT ANALYSIS OF PEL

The following is an assessment of the strengths, weaknesses, opportunities

and threats of Pak Elektron Limited:

Strengths

Widespread focus on supreme quality of products

Strong brand image

Strong dealer network

Strong grip in home appliances

Highly skilled and expert Management

Modernized research and development department

High quality products and brilliance after sales service

Weaknesses

Lack of advertisement

Lack of product range as compared to competitors

Weak marketing strategies than competitors

Vast unreached markets of Pakistan as PEL has dealer networks in

only 24 cities of Pakistan

PEL is not conducting E-Business and some of its competitors are

conducting business online like Waves.


PEL

Opportunities

Reaching the large unreached markets of Pakistan

Formation of strategic alliances with potential partners

Online and more modified marketing

Transmission of online business along with traditional element and

pointing business

Foreign alliances especially in technology and development

Increase in product range

Increase in production capacity

Reaching foreign markets

Threats

Strong competition both in appliances and power products industry

Un-explored markets may be confronted by foreign companies

Financial Problems

Deteriorating political conditions

Increasing prices due to inflation

Slow growth rate in Pakistan

Uncertainty of government

Increase in fuel prices & electricity power failure

Difficulties in recovery from debtors i-e liquidity problems

PEST Analysis


PEL

Political:

The political environment in Pakistan has been presenting quite unsteady

and affecting circumstances to virtually all the business in the country.

Sadly the condition has much emphasized in the recent periods. Where the

political and governmental policies and conditions influence all

businesses in one way or the other, the relative impact and importance of

the fundamental political situation can be determined according to the

nature of the commerce and the kinds of establishments it has with the

external entities for its operations and market. With a sound

establishment, nature of products (white goods) and a leading group of

companies, PEL has a buffer to its advantage against the ever changing

political conditions. Proprietorship by such a prominent group brings

opportunities concerning politicization for governmental policies and

other politically relating concerns.

Economical:

The economy is facing a far stretching inflation period supplemented by a

severe energy crisis which has not affected only the market but also the

costs of production and the supply chain. The demand for refrigerators - a

power product of PEL in home appliances, and A/Cs, as well as other

products, has been comprehensively affected due to frequent power

outages and increase in utility charges. On the contrary, the conditions

have increased the demand for generators. The increase in costs of


PEL

production can be signified by an increase in utility expense by

approximately 10 million rupees a month, where the company meets the

power shortage through its own generators. So as a result the retailers a

supply chain will be affected. As per the future prospects, major

investments in the energy sector are to be expected. If such struggles by

public and or private enterprises come by, should provide PEL with an

opportunity for its power products, which includes commercial type

electrical equipment like transformers, switch gears etc and EPC

contracting.

Social:

Pakistan is an LDC with a large population base. Certain dynamics over

the years have shaped the consumer first choice categorized by an

increasing demand in home appliances. However a standard underlying

consumer buying decisions is to prefer imported brands, when personal

economics are no restriction. However, an increased reliance on locally

manufactured and branded goods has increased over the recent times, as a

healthier competition has risen following establishment of various

manufacturers with in the country. Regarding marketing ethics and

environmental concerns, though awareness has increased over recently,

appeal to such problems and concerns by the general public remain low.

Technological:


PEL

PEL being a home and power appliances company appeals a close relation

with the technological environment available in Pakistan. This

environment itself has improved over the years and provided opportunities

for new- technologically more advances ventures, such as added

production lines for more advanced kinds of A/Cs, Refrigerators and

better power appliances. Though the technological environment in

Pakistan may not be advances to a high degree, it still provides a good

base line for an appliances company that is not involved in difficult and

high end products, but rather requires more of a common technology. The

competitive advantage and marginal decreases in costs of production for

applying technology in Pakistan however may be argued over. The capital

costs for bringing in new technology may exceed the choice of using

labor- for labor costs are lower in Pakistan. On the contrary, technology

may provide a higher level of quality. Thus there lies the principle of

trade-off between costs vs. quality. Currently the technological

environment in Pakistan does offer a higher level of technology but with

higher costs. Thus where the marginal cost may decrease the overall

investment may not suggest that PEL would essentially do so as it is not

currently involved in the production of high-end products, which can be

produced equally good by a much cheaper labor. The technological

environment regarding communications has substantially increased over

the recent years. Such advancement has assisted PEL to provide better

customer relationship management (CRM). PEL has a well-established


PEL

network of more than 1300 dealerships, display and customer care center

that communicate with a central customer service department and a call

center. The system keeps a close watch on the day to day bases and enjoys

good relationship with its customers.


PEL

CHAPTER# 6

Suggestions &

Recommendations

On PEL

Suggestions

PEL is facing financial problems PEL must try to come out of curse of

loans because it is paying billions in interest to financial associations


PEL

every year. For this PEL must try to realize more on equity and gradually

take release from all the loans. PEL must strengthen its collection policies

as it faces difficulties in recovery from debtors which creates liquidity

problems for the company. The PEL must have to apply better marketing

strategies to attract the customers, like other competitors are doing such

as Dawlance, Orient and Waves etc. PEL has narrow product range as

compared to its competitors e.g. kitchen appliances like sandwich makers,

juicers etc. so additional products must be included in PEL’s product

range. PEL must add attractive and advanced models and introduce new

features in its products like LED (Light Emitting Diode) temperature,

LCD displays on refrigerators.

The company must change the advertising theme and slogan to attract and

for the attention of customers. They must show some creativity in all

promotional activities. So PEL must come with some attractive slogan to

gain more competitive advantage over its competitors. PEL has to work on

their distribution network and must be spread in the unreached areas and

cities of Pakistan. PEL must form strategic alliances with potential

partners to strengthen the grip over national markets and reach

international markets as PEL has recently entered into a strategic alliance

with LG.

PEL must start selling its products online besides brick and mortar

business to reach the international customers especially as WAVES is

already following this strategy. PEL like other big companies should also


PEL

use bill-boards for advertising purposes. As PEL statements are an equal

opportunity employer so PEL must hire more female employees because

there are only 10 female employees in a huge organization of almost 700

employees. PEL must set away a specific quota for female employees.

Separate washrooms and prayer rooms must be provided for females in all

departments. PEL must introduce more innovative and new products which

are available at International level.

PEL must organize team work within bureaucracy and try to move toward

small company thinking. PEL must have an Extranet for creating

horizontal relationships with its suppliers and dealers. Employees at PEL

still mark attendance on manual records although whole organization is

computerized so there must be an automatic attendance system for

employees.

RECOMMENDATIONS

After looking into different weaknesses and future threats I recommend

the following steps to PAK Elektron Limited in order to deal with future

problems; PEL should present a true decentralize setup in the

organization, giving everyone some grounds for decision making, increase

employee’s involvement in day to day planning and recollect back the

assurance plus satisfaction of the employees. PEL should also consider the

importance of advertising for their new products, which plays an

important role in raising awareness, customer favorites and maximizing


PEL

market share. It should also use some tools such as organizing

promotional events, programs and gifts, etc. PEL needs to strengthen its

monitoring and inspection network in order to minimize the miss-use of

resources by employees and verify the correctness of the data collected by

them.

PEL should also make sure equal price incentives to all the retailers in

order to increase their willingness to offer more shelf space to the

company. PEL should also take care of the economic, political factors

such as inflation, Government Policies while projecting the Cost of

Production for future because this will help the company in entering into a

fix price contracts for the purchases of material at a single time similarly

than it will be able to charge stable prices to its customer. PEL should

also adopt any other methodology for projecting upcoming time period

sales, which should include seasonal factors consideration in order to get

accurate future assessments. As brand name is very important factor in

consumer buying behavior, thus it is advised that PEL should work on the

brand image. It already has a strong brand name but it has more to do,

mainly through advertising, to compete with its direct competitors and

other international brands. The company should add more features to their

products. People are attracted towards a product with unique features and

something that would make the customers feel that they have got their

money’s worth. The company should take measures to improve the quality

of their products. Thus the company is directed to take steps towards


PEL

improving the quality of its products and cosmetic features; otherwise it

will lose a portion of potential customers to their competitors. PEL should

have to cut down on the great margins to the dealers and give more

incentives to the consumers to healthier competition in the market from

push strategy to pull strategy. PEL extra effort should be on electronic

media to get competitive advantage over the competitors. They have to

increase their advertising expenditures. Introduction of seasonal schemes

can help to increase sales.


PEL

CHAPTER # 7

Conclusion


PEL

CONCLUSION

My own finding is that people while purchasing a specific item have an

excessive courtesy in the brand name, quality and features. Strong brand

name has very good impression in consumer’s mind and they usually favor

to purchase the same brand which they believe that is remarkable. As now

a day’s consumer’s demand is for Haier & Dawlance refrigerator. People

have strong guarantee in these brand names. All other factors like price,

advertisement, word of mouth and even dealers are secondary importance

in this concern. I believe that PEL is focusing more on Push Strategy &

Dealers network rather than Pull Strategy to create consumer demands in

the market. PEL is not targeting through nominal advertising, directing

marketing efforts by using progressive supportive communication tools.

This is factual that new technologies and designs generate new customs

for marketers to reach & analyze consumers interactively, but still greater

part of consumers in Pakistan is being affected by traditional media

Television, Magazines and Newspapers. Although PEL is doing some

advertising efforts but problem is that there is no creativity in ads.


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