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Final Project on Packages Limited Pakistan
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Packages Limited was established in 1957 as a joint venture between the Ali
Group of Pakistan and Akerlund & Rausing of Sweden, to convert paper and board
into packaging for consumer industry.
Over the years, the Company continued to enhance its facilities to meet the
growing demand of packaging products. Additional capital was raised from
sponsors, International Finance Corporation and from the public in 1965.
Packages commissioned its own paper mill in 1968 having production capacity of
24,000 tonnes of paper & paper board based on waste paper and agricultural
by-products i.e. wheat straw and river grass. With growing demand the capacity
was increased periodically and by 1996 it reached 65,000 tonnes per year.
Since 1982, Packages Limited has a joint venture with Tetra Pak International in
Tetra Pak Pakistan Limited to manufacture paper for liquid food packaging and to
market Tetra Pak packaging equipment.
In 1993, a joint venture agreement was signed with Mitsubishi Corporation of
Japan for the manufacture of Polypropylene films at the Industrial Estate in
Hattar, NWFP. This project, Tri-Pack Films Limited, commenced production in
June, 1995 with equity participation by Packages Limited, Mitsubishi
Corporation, Altawfeek Company for Investment Funds, Saudi Arabia, and General
Public. Packages Limited owns 33% of Tri-Pack Films Limited’s equity.
In July 1994, Coates Lorilleux Pakistan Limited, in which Packages Limited has
55% ownership, commenced production and sale of printing inks.
In 1996, a joint venture agreement was signed with Printcare (Ceylon) Limited
for the production of flexible packing materials in Sri Lanka. This project
packages Lanka (Private) Limited commenced production in 1998. Packages Limited
owns 62% of this Company.
In 1999-2000 Packages Limited has successfully completed the expansion of the
flexible packaging line by installation of new rotogravure printing machine and
the expansion of the carton line by a new Lemanic rotogravure inline printing
and cutting creasing machine. The machines are in production since December
1999.
To be a leader in the markets we serve by providing quality products and
superior service to our customers, while learning from their feed back to set
even higher standards for our products.
To be a company that continuously enhances its superior.
Technological competence to provide innovative solutions to customer needs.
To be a Company that attracts and retains outstanding people by creating a
culture that fosters openness and innovation promotes individual growth, and
rewards initiative and performance.
To be a Company which combines its people, technology, management systems, and
market opportunities to achieve profitable growth while providing fair returns
to its investors.
To be a company that endeavours to set the highest standards in corporate ethics
in serving the society.
BOARD OF DIRECTORS
Asadullah Khawaja
Istaqbal Mehdi
Khalid Yacob
Kirsten Rausing
Rafi Iqbal Ahmed
Samee-ul-Hasan
Saulat Said
Seppo Hietane
Syed Hyder Ali
Syed Wajid Ali
(Chairman & Chief Executive)
Advisor
Syed Babar Ali
Company Secretary
Adi J. Cawasji
Auditors
A. F. Ferguson & Co.
Chartered Accountants
Legal Advisors
Hassan & Hassan-Lahore
Orr,Dignam & Co. –Karachi
Bankers
ABN Amro Bank
American Express Bank Limited
Citibank N.A.
Credit Agricole Indosuez
The Global French Bank
Deutsche Bank A.G.
Emirates Bank International P.J.S.C
Faysal Bank Limited
Habib Bank Limited
Mashreq Bank
Muslim Commercial Bank Limited
Societe Generale
The French & International Bank
Standard Chartered Bank
Standard Chartered Grindlays Bank Limited
Union Bank Limited
United Bank Limited
Head Office & Works
Shahrah-e-Roomi
P.O. Amer Sidhu
Lahore-54760, Pakistan
PABX : 5811541-46, 5811191-94
Cable : PACKAGES LAHORE
Telex : 44866 PKGS PK
Fax : (042)
5811195, 5820147
Registered Office & Regional
Main operations of Packages Ltd. Lahore include:
·
Manufacturing paper and board.
·
Preparing packaging for hundreds of industrial and consumer goods.
·
Production of its own consumer goods e.g. Rose Petal and Tulip tissues, napkins,
paper cups etc.
Some other main departments of Packages Ltd. are:
·
Finance division
·
Commercial and Purchase department
·
Industrial Marketing & Sales department.
·
Research, Development & Control department.
·
Art Department
·
MIS-Department
·
Reproduction Department
·
Planning departments
·
Personel & Industrial Relations department.
Here are some key elements of Packages culture:
·
Openness and speech freedom.
·
Fostering innovation.
·
Promoting individual growth.
·
Rewarding initiative and performance.
·
Technological advancement
·
Updating learning and skills
·
Teamwork
·
Mannerism and punctuality.
We at Packages Limited are committed to producing quality products which conform
to our customers, requirements and strengthen our position as a quality-managed
Company. Our pledge is to provide the market with the best quality products at
competitive prices through a customer-driven and service-oriented, dynamic
management team. To meet this obligation, the Company will continue updating of
employee skills by training, acquisition of new technology, and regular
re-evaluation of its quality control and assurance systems. Appropriate
resources of the Company will be directed towards achieving the quality goals
through employees, participation.
Environment Health & Safety (EH&S) Policy Statement
Packages Limited shall:
·
Minimise its environmental impact, as is economically and practically possible.
·
Save raw materials including energy and water, and avoid waste.
·
Ensure that all its present and future activities are conducted safely, without
endangering the health of its employees, its customers and the public.
·
Develop plans and procedures and provide resources to successfully implement
this policy and for dealing effectively with any emergency.
·
Provide environmental, health and safety training to all employees and other
relevant persons to enable them to carry out their duties safely without causing
harm to themselves, to other individuals and to the environment.
·
Ensure that all its activities comply with national environmental, health and
safety regulations.
This policy shall be reviewed as and when required for the betterment of the
same.
Two way process:
1.
Internees
2.
Employees
Market research
They go to the market-check the packaging of different products which are not
made by packages then they come with new ideas or modification in the existing
packaging.
Reverse cycle
Their existing or new customer come to them and tell them about their needs for
modification or packaging of new products.
Research & development
Their research and development department work for the modification of packaging
Pre costing
Get the price of different material and tell to the customer about the rough
estimate
Quality
Quality check (acceptable to customer)
Samples
Then they make the sample of the product
Trial
Take the trial first on their own machine and then give trial to customer
Production
If the customer will satisfy and place the order then they start the production
of the product
Basis of segmentation
1.
Industrial product
2.
Consumer product
INDUSTRIAL MARKETING AND SALES DEPARTMENT
HIERARCHY OF INDUSTRIAL MARKETING
For industrial products Packages has four main sections:
1.
Corrugated Department
2.
Carton Department
3.
Flexible Department
4.
Poly & Paper Conversion
In this department the CWCs (Corruwall Cartons) are made for the industrial
products like textile products, little machinery, and sugar etc. Packages has
been producing CWCs since 1974, which are manufactured in a variety of sizes.
These CWCs provide a great value for the in-country distribution and export of
fresh fruits, garments, shoes and textiles etc.
Major Consumer Areas
1.
Textile Industry
2.
Food & Beverages
3.
Yarn & Poly Products
4.
Sports Industry
5.
Fruit Cartons
Major Customers
Some major customers for CWCs include:
1.
Gulistan Group of Industries
2.
Nishat Group of Industries
3.
Saphire Textile Mills
4.
Nestle Milk Pak Limited
5.
Lever Brothers
6.
Rupali group
7.
Crescent Greenwood (Mills).
Major Consumer areas
1.
Cigarette Industry
2.
Biscuit Industry
3.
Sweets
4.
Tea Cartons
5.
Detergents
6.
Shoe Cartons
7.
Match Industry
Major Clients
1.
Nestle Milkpak Limited
2.
Pakistan Tobacco Company
3.
Lakson Tobacco Company
4.
Lever Brothers
5.
Dane Foods Limited
6.
Continental Biscuits Limited
7.
English Biscuits Manufacturers
8.
Rafhan Best Foods Limited
9.
Union Match Manufacturers
10.
Procter & Gamble.
11.
BATA
12.
Service Shoes
Major Consumer Areas
1.
Soap industry
2.
Sweets
3.
Detergents
4.
Cooking Oils
5.
Biscuit Manufacturers
6.
Shampoos
7.
Snacks Industry
8.
Different food items like salt rice ketchup, custard powder etc.
Major Customers
1.
Lever Brothers
2.
Procter & Gamble
3.
Colgate Palmolive
4.
Rafhan Best Foods (Pvt.) Limited
5.
Continental Biscuits
6.
English Biscuits Manufacturers
7.
Nestle Milkpak Limited.
8.
Tripple-em snacks
9.
Dane Foods
10.
Sufi products
11.
National Foods Limited
Products
In this department the following main packaging is prepared:
1.
Paper cups
2.
Paper plates
3.
Gum tapes
4.
Poly bags
Important Features
1.
Flexographic is the printing method used here.
2.
Paper cup machine has capacity to make 4000-5000 cups per hour.
3.
For printing on Poly Bags, 6-color machine is
4.
Fisher & Krecke of Germany, with the capacity to print 150-meters per minute.
Major Customers
1.
McDonalds for paper cups.
2.
Pepsi for paper cups.
3.
Coca-Cola for paper cups.
4.
KFC for paper cups.
5.
Packages itself for paper cups and plates.
6.
Lever Brothers for poly bags (e.g. wheel ploy bag).
Target market
Air lines, ice cream manufacturers, soft drink manufacturers.
Segmentation
PIA, Aero Asia, Bhoja,
Walls, Igloo,
Coca-Cola, Pepsi Cola.
Target Market
Bakers, airlines, food chains.
Segmentation
Gourmet, Rahat Bakers,
PIA, Aero Asia, Bhoja,
KFC, McDonald’s, Pizza Hut.
Pricing
Pricing is based on long term relationship building, it means that for the first
time if they have to sell at breakeven, they go for that so that next time the
customer come to them. So prices are reasonable. Markup pricing technique is
used they are believing 2nd school of thought, that they do not cover
all cost from innovators rather they slowly cover their cost.
Promotion
They are using personal selling for promotion of their products. Employees and
internees go the customers, they communicate about their product and in this way
they create utility of their product.
Placement
If the customer demands that product is placed at their godowns, they place and
get placement charges, and if customer want to take himself from the company,
they also allow this.
1.
Rose Petal
2.
Tulip
It was 1981 when 'Packages' smell opportunity and felt the demand for disposable
convenient and hygienic tissues in Pakistan .so in 1981, 'Packages' modified one
of its paper machine to produce tissue paper-production was started and 'ROSE
PETAL brand was launched for the facial tissue.
Competitors and market share
For tissues 'PACKAGES' has 80% of market share that's simply a giant share. So
there is not very intense competition.
Target market
Their target market is upper class middle class & educated people
Bases for segmentation
Age (above 18 years)
Income group (upper upper, upper middle class)
Females (House wives )
Pricing
As you know it is for upper upper & upper middle class so quality is good and
prices are high
Target market
Their target market is lower and middle class
Bases for segmentation
Age (above 18 years)
Income group (middle & lower class)
Pricing
The target market for tulip is middle & lower class so the price of tulip is
less as compare to rose petal
Promotion
For the promotion of tissue papers advertising is the largest promotion tool
attracting about 70-80% of total promotional budget and in fact advertising is
the most powerful & effective media for consumer sales.
They specially target the house wives and their add is showing specially during
the news.
Reason
Hose wives also see news.
Why not during the drama because there are lot of adds and during the interval
they simply go to kitchen to prepare tea or to complete the food which they are
cooking.
For the promotion of tissue papers specially, advertising is the largest
promotional tool, attracting about 78-80% of total promotional budget and in
fact advertising is the most effective media for consumer sales.
Placement
Packages have 172 professional distributors.
They get the lots from their godowns & then distribute it in all over.
Pakistan to the retailers and whole sellers.
Skilled Workforce
Packages enjoys an educated and skilled work force to perform its operations
e.g. in Industrial Marketing Department all new hired sales executives are MBAs.
On technical side Packages has 2-Ph. Ds., 99- engineers and 314-diploma
engineers.
ISO 9001
In compliance with worldwide standards, the ISO-9001 certificate has been
awarded to “Flexible line” and “Carton line” of Packaging division.
Large-Scale Economies
Since Packages is a giant setup, so it enjoys the economies of large-scale as
well e.g. its fixed cost is reduced as it is spread over more number of units.
Goodwill
No doubt, Packages occupies a respectable and trustable image and market
reputation, serving as a valuable asset for the Packages.
Advanced Technology
To meet the quality requirements of its customers Packages contains the latest
paper producing and packaging technology and most of machinery is imported from
different countries like Germany, USA, Switzerland, etc.
Advance Payments
In most of the cases and especially from new customers, Packages deals with the
payments in advance. So it has to put less efforts to recover the payments.
Training
In Packages employees are given necessary and comprehensive orientation before
starting the job. Moreover other training programs are also arranged to kept the
skills of employees up-to-date.
Weaknesses
Slow Information Flow
Information flow between regional offices (of Karachi, Islamabad) and production
lines (Lahore) is not very quick, improper and manual i.e. by post normally.
Just Large Orders
Packages’ production facility is inflexible, in a sense that it is unable to
operate for small orders due to increased fixed cost. In this way, a lot of
small orders are rejected.
High Prices
Packages deserve to charge high prices for its quality products but in this way,
the companies who are not financially sound or in development stage can’t have
access to the Packages.
Longer Lead Time
Due to a lot of work load, the lead times are mostly longer so creating
frustration in customers and causing dissatisfaction.
Opportunities
There is a gradual increase in the awareness about Packaging importance among
the industrialists and they are really considering the packaging as the final
sales person for the products. So this awareness will brings more customers to
the door of Packages.
Business activity and investment flow in also increasing day by day, so causing
new business opportunities for whole packaging industry.
Consumers and companies are becoming more conscious about the quality of the
products and Packages is quality leader in Pakistan’s packaging industry and
having continuous development plans for quality. So in near future it can bring
huge revenues in the Packages.
Trend of sachets is also increasing day by day. Or in other words demand for
flexible packaging is increasing day by day.
Threats
Packaging (especially flexible or poly packing) negatively influences the
environment by increasing the wastes. So this is a real threat for Packages.
Due to latest printing technology, the demand for offset printing is decreasing
day by day which is a traditional printing mode used in Packages.
Packages is facing a strong competition from the Cottage Industry in Karachi
producing corrugated cartons.
Table of Contents
Introduction.......................................................................................................................
1
Mission Statement...........................................................................................................
3
Company Information......................................................................................................
4
Main Operations...............................................................................................................
7
Departments......................................................................................................................
7
Organization’s Culture....................................................................................................
8
Quality Policy....................................................................................................................
9
Environment Health & Safety (Eh&S) Policy Statement........................................
10
Product Development...................................................................................................
11
Product Mix.....................................................................................................................
13
Corrugated Department................................................................................................
14
Carton Line.....................................................................................................................
15
Flexible Line...................................................................................................................
16
Poly & Paper Conversion.............................................................................................
17
Industrial Products.........................................................................................................
19
Paper Cups.....................................................................................................................
19
Paper Plates...................................................................................................................
19
Consumer Product........................................................................................................
21
Rose Petal.......................................................................................................................
21
Tulip.................................................................................................................................
22
Swot Analysis.................................................................................................................
24
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