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Final Project on

Agriauto Industries Limited

Submitted By; Nasir Abbas 1652-411015

EMBA-Marketing

Submitted To

Prof. Irfan Faridi

Manufacturer of Shock absorber, Struts, Camshaft, steering box, Pipe fork, Door hinges, Stamping parts & Motorcycle Shock.

ACKNOWLEDGEMENT

All praise for almighty Allah who guides us in darkness and help us in all difficulties and problems. Many thanks to Him, who created us Muslim and blessed us with education so that we can differentiate between right and wrong. I offer my humblest and sincerest respect to Holy Prophet Muhammad (SAWW) who is the torch of guidance and knowledge for the humanity for all the time to come. He enabled us to recognize our creator. Teachers are great source of knowledge, love, dignity, determination and patience I wish to express my thanks to all my teachers for their proper guidance, valuable suggestions and friendly behavior during my studies. May Almighty Allah shower His blessings on all those who associated and facilitated me in any way during completion of my final Project.

DEDICATION

Dedicated To My loving Parents and Grand Parents Who determined the path and destination for me and who always make things possible for me. My loving Brothers and Sisters Whose prays and support enabled me to complete my studies

TABLE OF CONTENTS
Vision..09 Mission..10 Corporate Objectives..11 Core Values.. .13 Statement of Compliance.14 Chief Executive Message..16 Quality Policy...17 General Introduction of Study..18 House of Habib Group Introduction.20 Agriauto Industries Introduction.23 Agriauto Milestones....24 Agriauto Stamping Company (Subsidiary)...25 Marketing Mix & 4 Ps ...26 Products Range...29 Product .30 Price.40 Place.41 Promotion...43

Creating Competitive Advantage.55 Customer Profile....61 SWOT Analysis..63 EFE Matrix...65 IFE Matrix....66 BCG Matrix.....67 Corporate Social Responsibility.74 Customer Relationship Management.....79 Six years at a glance.....84 Financial Highlights......85 Health, Safety, Environment at Agriauto...86 5S Model.......90 Kaizen Concept.........92 Future Challenges........94 Agriauto Exhibition (2012-13)..........102 Observation Study...........106 Conclusion.............106 Project References........107

Vision

A World Class manufacturer and supplier of high entry barrier automotive components providing competitive returns to all stakeholders.

Mission

We strive to stride as our future is tomorrow.

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Corporate Objectives

1. Best Corporate Citizen Care for and serve all stakeholders. Be the #1 auto parts manufacturer in Pakistan, in terms of sales turnover, product reliance, customer satisfaction and profitability. Fulfill social obligations. Achieve and maintain high corporate image in Pakistan.

2. Best Employee Care Attract above average people for employment. Provide opportunities for growth and job enrichment. Provide opportunities for development. Provide compensation at par with the best in the industry and caring beyond.

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3. Low cost producer Market leader Competitive CKD cost. Competitive materials cost. Lean & flat organization. Increased localization with appropriate technology. Increased operation efficiency. Use of appropriate technology. Diversity - add other products to spread overhead costs.

4. # 1 in Market Share & Customer satisfaction Meet changing market needs. Responsiveness. Competitively priced parts. Training and Development of personnel. 5. # 1 in product technology Superior product features with constant improvements. Highest reliability. R & D to adapt to specific product / customer needs. Training and development of personnel. 6. Other products Coil springs, Motorcycle shocks, and parts / assemblies which fit in with our core competence and vision. 7. Good returns on investment Higher than the bank rate and comparable with good companies in the sector. Future Outlook Ours is a culture that delegates responsibility and accountability and inspires creativity & entrepreneurism. We are fully geared to take advantage of opportunities and meet the future challenges. We look to: Delight our customers by providing continuously improving technology; Perpetuate a joyful working environment; Provide competitive returns to all our stake-holders; Be a good corporate citizen, fulfilling all our responsibilities.

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Core Values
Continuous improvement

We endeavor to upgrade our manufacturing facilities by acquiring advanced technology with emphasis on timely development of new products coupled with human resource and skill enhancement for the delight of our customers.

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Satement of Compliance with the Code of Corporate governance

This statement is being presented to comply with the Code of Corporate Governance contained in listing regulations of Karachi and Lahore Stock Exchanges for the purpose of establishing a framework of good governance, whereby a listed company is managed in compliance with the best practices of corporate governance. Agriauto Industries Limited (the Company) has applied the principles contained in the Code of Corporate governance in the following manner:

1. The Company encourage representation of independent non-executive directors and director representing minority interesrs on its Board of directors (the board). At present, the Board comprises of seven directors which includes five non-executive directors. 2. The directors have confirmed that non of them is serving as a director on more than seven listed companies, including the Company. 3. All the resident directors of the Company are register as taxpayers and none of them has defaulted in payment of any loan to a bank company. 4. No casual vacancies occurred during the year. 5. The company has prepared a Code of Conduct and has ensured that appropriate steps have been taken to disseminates it througout the Company along with its supporting policies and procedures. 6. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the Company. 7. All the powers of the Board have been duly exercised and decisions on material transactions, including appointment and determination of remuneration and terms and

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conditions of employment of the CEO, other executive and non-executive directors have been taken by the board. 8. The meeting of the Borad were presided over by the Chairman and, in his absence, by a director elected by the Board for this purpose and the Board met at least once in every quarter. 9. Two directors of the Company are certified directors from Pakistan Institute of Corporate Governance and one director is exempted from the requirement by virtue of his experience as prescribed by SECP in clause (xi) of CCG. 10. No new appointment of CFO/Company Secretary has been made during the year. 11. The directors report for this year has been prepared in compliance with the requirements of the Code of Corporate Governance and fully describes the salient matters requires to be disclosed. 12. The financial statements of the Company were duly endorsed by CEO and CFO before approval of the Board. 13. The directors, CEO and executives do not hold any interest in the shares of the Company other than that disclosed in the pattern of shareholding. 14. The Company has complied with all corporate and financial reporting requirements of the Code of Corporate Governance. 15. The board has formed an Audit Committee. 16. The meeting of the audit committee were held at least once every quarter prior to approval of interim and final results of the Company. 17. The Board has formed an HR and Remuneration Committee. 18. The Board has Outsourced the internal audit function to Noble Computer Services (Private) Limited. 19. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the quality control. 20. The statutory auditors associated with them have not been appointed to provide other services except in accordance with the listing regulations. 21. The closed period,prior to the announcement of interim/final result, and business decisions, which may materially affect the market price of companys securities, was determined and intimated to directors, employees and stock exchanges. 22. Material/price sensitive information has been disseminated among all market participants at once through stock exchanges. 23. We confirm that all other material principles enshrined in the Code of Corporate Governance have been complied with, except that the position of the Company secretary and CFO is held by the same person. The said decision has been taken by the Board keeping in view the size of the Company.

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Fahim Kapadia-CE Chief Executive Message Agriauto Industries Limited (AIL) as a company is striving to redefine what our customers expect from us, to provide more than they ever thought possible from a single source. We feel strongly that accomplishing this goes beyond, goes deeper, than the quality of our products and services. It goes to the ability and commitment that each and every one of us at AIL must have to exceed our customers expectations. We have come a long way since 1981 from being a manufacturer of tractor parts to become the countrys industry leader in ride controls with offerings to OEMs and the aftermarket. We see plenty of potential for continued improvement and growth and in my experience I have found that when you raise expectations for yourself, it puts a very positive process in motion. It is very exciting to consider what we can achieve from here.

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Quality Policy
Excellence in manufacturing of automotive parts through continuous improvement in people, systems and technology to meet at all times the customers needs of quality, volume & timeliness.

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GENERAL INTRODUCTION TO THE PROJECT

Auto market is one of the largest segments in world trade. Changing models, improving fuel efficiency, cutting costs and enhancing user comfort without compromising quality are the most important challenges of the auto industry in a fast globalizing world. The first phase of automotive assembling in Pakistan started in 1950 with Bed Ford truck followed by Ford Prefect, Ford Cortina and Dodge Dart. The indigenized parts in these vehicles did not exceed 20% with only exception of Bed Ford trucks with a deletion level of 80%. By the end of 70s practically all automobile assembling in Pakistan ceased. The 2nd phase of Automobile assembly started in 1983 with the introduction of FX 800 CC Suzuki Car. In 1989 Pak. Suzuki changed the Model of FX 800 CC with Mehran 800CC. Pak Suzuki thereafter in 1992 introduced Khyber 1000 CC and 1300 CC Margalla but the indigenization levels from 1983 to 1995 were not significant (i.e. Mehran 30%, Khyber 20%, and Margalla, 15%). In 1993, Indus Motors Company Ltd., Karachi introduced Toyota Corolla. Honda Atlas cars (Pak) Ltd Lahore in 1994 introduced Honda Civic having 1300CC engine capacity. Indus Motors, Dewan Farooq Motors and Pak Suzuki introduced smaller Cars i.e. Cuore, Cultus and Santro of engine capacities 850 cc, 1000 cc respectively in 2000. This was known as era of competitiveness. Up to 1995, the deletion cell of MOI&P was formulating and monitoring the deletion programs. The industry specific deletion programs were formulated to specify local content requirements for cars, motorcycles, Buses and Trucks Tractors etc. The deletion policy finalized in 1996 has the following features: Industry Specific Deletion program. No roll back from achieved Deletion Levels. Even handled Tariff Protection at all levels of processing.

The deletion levels were finalized by the sub-committees for cars, LCVs, Motorcycles and tractors etc., constituted by indigenization committee of EDB on the basis of technology levels prevalent in the engineering industry of Pakistan. The Industry specific deletion program (ISDP) books were published and distributed amongst the stakeholders, which resulted in a significant improvement in indigenization.

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Major Policies after year 2005

1. Tariff Based Systems (TBS) 2. Auto Industry Development Program (AIDP). July 1st 2006, the deletion programs for the Automotive Sector have been replaced by the Tariff Based System (TBS). The deletion programs have gradually been phased out under the WTO regime to become TRIMs compliant. The TBS is the outcome of a long drawn consultative dialogue between all stakeholders including OEMs and Vendors, belonging to different sub-sectors of the Automobile Industry. The TBS has been developed with the following overriding objectives: Preservation & promotion of technologies that have been developed in the country Protection to the present job structure in the auto sector. Promote job creation Protect the existing & planned investment by the OEMs & Vendors Promote new investment Expand the consumer base to create economies of scale The basic framework of Tariff Based System is as under: 1. Imports in CKD condition would be allowed only to assemblers having adequate assembly facilities and registered as such by the concerned Federal Government Agency. 2. Parts/ components indigenized by June 2004 have been placed at higher rate of Customs Duty. 3. Parts not indigenized would be allowed at CKD rate of Custom Duty. Introduction of Statutory Regulatory Order (SRO): 1. SRO 656 (I) / 2006 dated June 22, 2006 (For OEMs) 2. SRO 693 (I) / 2006 dated July 1, 2006 (For OEMs) 3. SRO 655(I) / 2006 dated June 22, 2006 (For Vendors)

The automobile industry in Pakistan can be broadly categorized into following segments:
Cars and Light Commercial Vehicles (LCVs). Two and Three Wheelers. Tractors. Trucks and Buses. Vendor Industry.

The industry operates under franchise and technical cooperation agreements with Japanese, European and Korean manufacturers.

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House of Habib Introduction (The Group)

The House of Habib to is the heir to a rich tradition of commerce and banking dating back 1841. The name House of Habib identifies the business activities of the Mohammed Ali Habib family (third son of Mr. Habib Esmail). A man of vision and exceptional leadership, he was the architect and builder (with his brothers) of the group which included Habib Bank Limited and Habib Insurance Co. Ltd., established in 1941 and 1942 respectively.

Mohammed Ali Habib

Today, the House employs over 14,000 people who provide an array of products and services. Activities range from automobiles to audio media, buildings to banking and computers to chemicals. Managing a network of public (listed on the Pakistan Stock Exchanges) and private companies, the House of Habib has equity and technical collaborations with British, Japanese and Norwegian companies. The tradition of the family could be described as conservative, yet it places great emphasis on decentralized professional management resulting in a progressive and dynamic organization.

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OUR BUSINESS House of Habib has strong presence in various vertical markets. Automobile

Indus Motor Company Agriauto Industries Limited Thal Limited Electric Thal Limited Thermal

Building Materials

Shabbir Tiles and Ceramics Limited Thal Limited Baluchistan Laminates Division

Packaging

Thal Limited Papersack Division Thal Limited Jute Division

Plastic

AuVitronics Limited

Wholesale

Metro-Habib Cash & Carry Pakistan

Tractor

Agriauto Industries Limited

Financial Services

Habib Insurance Company Limited Noble Computer Services (Pvt) Ltd

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 Indus Motor Company Indus Motor Company is a Joint Venture between Toyota Motor Corporation of Japan, Toyota Tsusho Corporation of Japan and House of Habib. Agriauto Industries Limited Agriauto Industries Limited is catering to the demands of both OEM and replacement market in shock absorbers and struts in Pakistan. Thal Limited Thal Limited Engineering Division is a manufacturer of car air conditioners, progressively manufacturing under a TAA (Technical Assistance Agreement) with Denso Corporation, Japan. DYNEA Pakistan Limited DYNEA Pakistan Limited produces quality industrial resin for use in industries like particleboard, chipboard, hardboard, veneer board and melamine resin for lamination industry. Baluchistan Laminates Baluchistan Laminates Division manufactures high-pressure and low-pressure decorative and technical laminates with the brand name of "FORMITE". Noble (Pvt.) Limited Noble (Pvt.) Limited specializes in real estate development and construction contracting. Shabbir Tiles and Ceramics Limited Shabbir Tiles and Ceramics Limited is the producer of ceramic wall tiles in plain, prints and textures available in various sizes and colors Pakistan Paper sack Corporation Limited Pakistan Paper sack Corporation Limited caters to the cement and non-cement industries for the supply of paper sacks. In its state-of-the-art manufacturing plant. AuVitronics Limited: AuVitronics Limited offers high-precision injection molding and molded parts and sub-assemblies (in technical collaboration with a Malaysian Company) for the automobile industry. Habib Insurance Company Limited: continues its selective approach towards the businesses it underwrites, and is today looking ahead to the rapidly changing industrial and financial environment in Pakistan.

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Agriauto Industries Limited

Agriauto Industries Limited is a Public Limited Company incorporated in 1981 and quoted on the Stock Exchange. The company is a part of "House of Habib" group. Is one of the leading Automotive Components manufacturing companies in Pakistan. Has a team of around 300 employees. Have state-of-the-art production facilities located at 68,800 sq. meter plot at Hub Industrial Area (Baluchistan) with ample space for further expansion for future projects. Technical Collaborations with; Gabriel Ride control (USA) and KYB (Japan). The companys product range covers the requirements of both Original Equipment Manufacturers (OEM) and After-Market. Follows international standards like BS, SAE, ASTM, and JIS for producing top quality automotive products.

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Milestones
Incorporated Quoted on Stock Exchange TAA with Gabriel Inc. (USA) TAA with KYB (Japan) ISO-9002 Certified Pipe Fork/Case Damper Prod. Motor Cycle Shock Absorber ISO-9001-2000 Certified ISO TS-16949 Certified TAA with AISIN (Japan) Press Shop Project SAP Impliment5ation Initiated by IBM 1981 1984 1985 1994 2000 2002 2004 2005 2005 2005 2008 2011

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Agriauto Stamping Company (Private) Limited

The board of Directors of the company at their meeting held on January 09, 2012 have resolved to establish a wholly owned subsidiary by the name of Agriauto Stamping Company(Private) Limited. Agriauto Industries Limited invests up to PKR 1.05 billion in the subsidiary. The subsidiary will carry out the business of stamping of sheet metal parts, sub-assembly operations, and dies/checking fixtures/jigs manufacturing for automotive sector. Agriauto Stamping Company(Private) Limited is being incorporated for the purpose of carrying out the business of stamping of sheet metal parts, sub-assembly operations, dies/checking fixtures/Jigs manufacturing primarily for automotive sector. The production of new facility is likely to commence from July 2014. Major equipment including presses has started arriving; orders for dies and tooling have been placed and progress on technical training of some of our employees at Ogihara is very satisfactory. We would like to express our appreciation to all our customers, dealers, bankers and foreign technical collaborators for their unabated support and confidence in the Company. We are also thankful to all our team members who have worked diligently to support our customers and the progress of the Company.

Company Strategies for 2010 -2015

Explore new business in 2 wheeler segment; TAA with SHOWA Japan for Atlas Honda Ltd.

Joint venture with SUMMIT Thailand for press parts. Modernizing of plant facility. Extensive training with Kayaba Japan to develop human resource. Initiation of succession planning for development of 2nd Tier management & retain talented human resource.

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Marketing Mix and 4 Ps

The marketing mix is a business tool used in marketing and by marketing professionals. The marketing mix is often crucial when determining a product or brand's offering, and is often synonymous with the four Ps: price, product, promotion, and place; in service marketing, however, the four Ps have been expanded to the seven Ps or eight Ps to address the different nature of services.

The 4Ps model is just one of many marketing mix lists that have been developed over the years. And, whilst the questions we have listed above are key, they are just a subset of the detailed probing that may be required to optimize your marketing mix.Amongst the other marketing mix models have been developed over the years is Boom and Bitner's 7Ps, sometimes called the extended marketing mix, which include the first 4 Ps, plus people, processes and physical layout decisions. Another marketing mix approach is Lauterborn's 4Cs, which presents the elements of the marketing mix from the buyer's, rather than the seller's, perspective. It is made up of Customer needs and wants (the equivalent of product), Cost (price), Convenience (place) and Communication (promotion). In this article, we focus on the 4Ps model as it is the most wellrecognized, and contains the core elements of a good marketing mix.

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The marketing mix is a good place to start when you are thinking through your plans for a product or service, and it helps you avoid these kinds of mistakes. Understanding the Tool The marketing mix model can be used to help you decide how to take a new offer to market. It can also be used to test your existing marketing strategy. Whether you are considering a new or existing offer, follow the steps below help you define and improve your marketing mix. 1. Start by identifying the product or service that you want to analyze. 2. Now go through and answer the 4Ps questions as defined in detail above. 3. Try asking "why" and "what if" questions too, to challenge your offer. For example, ask why your target audience needs a particular feature. What if you drop your price by 5%? What if you offer more colors? Why sell through wholesalers rather than direct channels? What if you improve PR rather than rely on TV advertising? 4. Once you have a well-defined marketing mix, try testing the overall offer from the customers perspective, by asking customer focused questions: 1.Does it meet their needs? (product) 2.Will they find it where they shop? (place)

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3.Will they consider its priced favorably? (price) 4.And will the marketing communications reach them? (promotion) 5.Keep on asking questions and making changes to your mix until you are satisfied that you have optimized your marketing mix, given the information and facts and figures you have available. 6.Review you marketing mix regularly, as some elements will need to change as the product or service, and its market, grow, mature and adapt in an ever-changing competitive environment.

KEY POINTS The marketing mix helps you define the marketing elements for successfully positioning your market offer. One of the best known models is the Four Ps, which helps you define your marketing options in terms of product, place, price and promotion. Use the model when you are planning a new venture, or evaluating an existing offer, to optimize the impact with your target market

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Products Range
Shock Absorber & Struts Pipe Fork McPherson Assembly Camshafts Door & Hood Hinges Steering Box (Tractors) Motorcycle Shock absorbers Stamping Parts (Instruments Panel/Sheet Parts)

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Product/Service
A product is seen as an item that satisfies what a consumer needs or wants. It is a tangible good or an intangible service. Intangible products are service based like the tourism industry, the hotel industry and the financial industry. Tangible products are those that have an independent physical existence. Typical examples of mass-produced, tangible objects are the motor car and the disposable razor. A less obvious but ubiquitous mass produced service is a computer operating system. Every product is subject to a life-cycle including a growth phase followed by a maturity phase and finally an eventual period of decline as sales falls. Marketers must do careful research on how long the life cycle of the product they are marketing is likely to be and focus their attention on different challenges that arise as the product moves through each stage. The marketer must also consider the product mix. Marketers can expand the current product mix by increasing a certain product line's depth or by increasing the number of product lines. Marketers should consider how to position the product, how to exploit the brand, how to exploit the company's resources and how to configure the product mix so that each product complements the other.

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The marketer must also consider product development strategies.

What does the customer want from the product/service? What needs does it satisfy? What features does it have to meet these needs? Are there any features you've missed out? Are you including costly features that the customer won't actually use? How and where will the customer use it? What does it look like? How will customers experience it? What size(s), color(s), and so on, should it be? What is it to be called? How is it branded? How is it differentiated versus your competitors?

Shocks, struts and all other parts manufactured by Agriauto Industries Limited are produced in technical collaboration with World leaders in these products, and hence are of high quality and comparable similar products manufactured by other world class manufacturers. Agriauto Industries offer reasonable prices to the customers after collecting feedback from market and analyzing the market. Agriauto Industries also offer 6-months warranty on shocks & struts.

Warranty Policy
6-months warranty from the date of purchase by the end-user, on manufacturing defects. The success of this warranty policy requires close co-operation between the Principal and the Dealer.

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Shock Absorbers & Struts

Agriauto Industries Ltd. is the sole manufacturer and supplier of Gabriel/KYB brand shock absorber in Pakistan. High Quality oil & gas shock absorbers and struts for all kinds of vehicles.

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Pipe Fork
High quality chrome plated motorcycle front fork and produced for the leading OEM.

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McPherson Assembly
McPherson Assembly for Toyota cars

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Camshaft
These are manufactured for the domestic tractor industry; from the best quality forged steel and chilled iron casting. Key customers include Al-Ghazi tractor & Millat Tractors.

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Door & Hood Hinges

Agriauto is assembling door and hood hinges of Toyota corolla motor car.

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Steering Box (Tractors)

Agriauto provides steering assembly for Massey Ferguson tractors, assembled by Millat tractors Limited.

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Moto Cycle Shock Absorbers

To cater for the need of the emerging 2-Wheeler segment, the company is also manufacturing motorcycle shock absorbers.

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Stamping Parts (Instruments Panel/Sheet Parts)

Currently the company is producing large variety of parts reinforcement instrument panel, door impact beams, suspension and body parts.

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Price

What is the value of the product or service to the buyer? Are there established price points for products or services in this area? Is the customer price sensitive? What discounts should be offered to trade customers, or to other specific segments of your market? How will your price compare with your competitors?

The price is the amount a customer pays for the product. The price is very important as it determines the company's profit and hence, survival. Adjusting the price has a profound impact on the marketing strategy, and depending on the price elasticity of the product, often it will affect the demand and sales as well. The marketer should set a price that complements the other elements of the marketing mix. When setting a price, the marketer must be aware of the customer perceived value for the product. Three basic pricing strategies are: market skimming pricing, market penetration pricing and neutral pricing. The 'reference value' (where the consumer refers to the prices of competing products) and the 'differential value' (the consumer's view of this product's attributes versus the attributes of other products) must be taken into account.

How Agriauto determine Price

Agriauto Industries offer reasonable prices to the customers after collecting feedback from market and analyzing the market. Agriauto Industries also offer 6-months warranty on shocks & struts. Shocks, struts and all other parts manufactured by Agriauto Industries Limited are produced in technical collaboration with World leaders in these products, and hence are of high quality and comparable similar products manufactured by other world class manufacturers.

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Place
Place refers to providing the product at a place which is convenient for consumers to access. Place is synonymous with distribution. Various strategies such as intensive distribution, selective distribution, exclusive distribution and franchising can be used by the marketer to complement the other aspects of the marketing mix. The seven Ps is an additional marketing model that refers to the already mentioned four Ps, plus 'Physical evidence', 'People', and 'Process'. 'Physical evidence' refers to elements within the store -- the store front, the uniforms employees wear, signboards, etc. 'People' refers to the employees of the organization with whom customers come into contact. 'Process' refers to the processes and systems within the organization that affects its marketing process.

Where do buyers look for your product or service? If they look in a store, what kind? A specialist boutique or in a supermarket, or both? Or online? Or direct, via a catalogue? How can you access the right distribution channels? Do you need to use a sales force? Or attend trade fairs? Or make online submissions? Or send samples to catalogue companies? What do you competitors do, and how can you learn from that and/or differentiate?

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How Agriauto determine Place

Agriauto Industries Limited Manufactured shock absorbers & struts will be retailed through a network of dealers across Pakistan. The dealers need to understand the warranty policy, and where possible have an effective display. Agriauto Industries products distribution process; 1. 2. 3. 4. Factory/Manufacturer Warehouse Dealers (North & south Zone) Retailers/End user

Dealer selection criteria

1. The dealer will not to be associated with the sale of similar products coming into the market through unlawful means. 2. The distributor will sell all the products in their original packaging, without removing, defacing, concealing or altering marks or numbers prior to sales, and will not misuses or cause others to misuse any Trademark, brand name, company logo, which belong to principal. 3. The dealer will maintain an attractive & effective display of a comprehensive range of products in the main showroom. 4. Unless otherwise agreed, the Dealer will hold at all times a comprehensive range of products for distribution, up to minimum levels recommended by Principal. 5. The dealer will assume primary responsibility to actively promote and develop trade, in each class of product. 6. The dealer will assist the Principal in undertaking regular market survey to determine market size, brand share and market trends.

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Promotion
Promotion represents all of the methods of communication that a marketer may use to provide information to different parties about the product. Promotion comprises elements such as: advertising, public relations, personal selling and sales promotion. Advertising covers any communication that is paid for, from cinema commercials, radio and Internet advertisements through print media and billboards. Public relations is where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word-of-mouth is any apparently informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and public relations (see 'product' above).

Where and when can you get across your marketing messages to your target market? Will you reach your audience by advertising in the press, or on TV, or radio, or on billboards? By using direct marketing mail shot? Through PR? On the Internet? When is the best time to promote? Is there seasonality in the market? Are there any wider environmental issues that suggest or dictate the timing of your market launch, or the timing of subsequent promotions? How do your competitors do their promotions? And how does that influence your choice of promotional activity?

Agriauto Promotion Strategy

Regular end user contact through mobile teams. Constant maintenance end user data bank. Agriauto will initiate co-operative advertising campaigns as and when required.

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Market
The term market may be considered as a convenient meeting place where buyers and sellers gather together for the exchange of goods and services. Market means a group of people having unmet wants, purchasing power to make their demand effective and the will to spend their income to fulfill those wants. Today a market is equated with the total demand.

An actual or nominal place where forces of demand and supply operate, and where buyers and sellers interact (directly or through intermediaries) to trade goods, services, or contracts or instruments, for money or barter. Markets include mechanisms or means for determining price of the traded item, communicating the price information, facilitating deals and transactions, and effecting distribution. The market for a particular item is made up of existing and potential customers who need it and have the ability and willingness to pay for it. Markets vary in form, scale (volume and geographic reach), location, and types of participants, as well as the types of goods and services traded. Examples include:

Physical retail markets, such as local farmers' markets (which are usually held in town squares or parking lots on an ongoing or occasional basis), shopping centers and shopping malls (Non-physical) internet markets (see electronic commerce) Ad hoc auction markets Markets for intermediate goods used in production of other goods and services Labor markets International currency and commodity markets Stock markets, for the exchange of shares in corporations Artificial markets created by regulation to exchange rights for derivatives that have been designed to ameliorate externalities, such as pollution permits (see carbon trading) Illegal markets such as the market for illicit drugs, arms or pirated products

In mainstream economics, the concept of a market is any structure that allows buyers and sellers to exchange any type of goods, services and information. The exchange of goods or services for money is a transaction.

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Marketing
What is marketing? The definition that many marketers learn as they start out in the industry is:

Putting the right product in the right place, at the right price, at the right time. Marketing is the process of communicating the value of a product or service to customers. Marketing might sometimes be interpreted as the art of selling products, but selling is only a small fraction of marketing. As the term "Marketing" may replace "Advertising" it is the overall strategy and function of promoting a product or service to the customer. The American Marketing Association defines marketing as "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large." There are five competing concepts under which organizations can choose to operate their business; the production concept, the product concept, the selling concept, the marketing concept, and the holistic marketing concept. The four components of holistic marketing are relationship marketing, internal marketing, integrated marketing, and socially responsive marketing. The set of engagements necessary for successful marketing management includes, capturing marketing insights, connecting with customers, building strong brands, shaping the market offerings, delivering and communicating value, creating long-term growth, and developing marketing strategies and plans.

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From a societal point of view, marketing is the link between a societys material requirements and its economic patterns of response. Marketing satisfies these needs and wants through exchange processes and building long term relationships. The process of communicating the value of a product or service through positioning to customers. Marketing can be looked at as an organizational function and a set of processes for creating, delivering and communicating value to customers, and managing customer relationships in ways that benefit the organization and its shareholders. Marketing is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behavior and providing superior customer value. There are five competing concepts under which organizations can choose to operate their business; the production concept, the product concept, the selling concept, the marketing concept, and the holistic marketing concept. The four components of holistic marketing are relationship marketing, internal marketing, integrated marketing, and socially responsive marketing. The set of engagements necessary for successful marketing management includes, capturing marketing insights, connecting with customers, building strong brands, shaping the market offerings, delivering and communicating value, creating long-term growth, and developing marketing strategies and plans. Marketing Management Marketing management represents an important functional area of business management efforts for the flow of goods and services from the producer to the consumers. It looks after the marketing system of the enterprise. It has to plan and develop the product on the basis of known customer demand.

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Marketing management may be defined as, a process of management of marketing programs for accomplishing organizational goals and objectives. Marketing management has to build up appropriate marketing plan or marketing mix to fulfill the set goals of the business. It has to formulate sound marketing policies and programs. It looks after their implementation and control. programs and campaigns. Marketing research Marketing research involves conducting research to support marketing activities, and the statistical interpretation of data into information. This information is then used by managers to plan marketing activities, gauge the nature of a firm's marketing environment and attain information from suppliers. Marketing researchers use statistical methods such as quantitative research, qualitative research, hypothesis tests, Chi-squared tests, linear regression, correlations, frequency distributions, poison distributions, binomial distributions, etc. to interpret their findings and convert data into information. The marketing research process spans a number of stages, including the definition of a problem, development of a research plan, collection and interpretation of data and disseminating information formally in the form of a report. The task of marketing research is to provide management with relevant, accurate, reliable, valid, and current information. It has to implement marketing strategies,

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A distinction should be made between marketing research and market research. Market research pertains to research in a given market. As an example, a firm may conduct research in a target market, after selecting a suitable market segment. In contrast, marketing research relates to all research conducted within marketing. Thus, market research is a subset of marketing research. The market environment is a marketing term and refers to factors and forces that affect a firms ability to build and maintain successful relationships with customers. Three levels of the environment are: Micro (internal) environment - forces within the company that affect its ability to serve its customers. Meso environment the industry in which a company operates and the industrys market(s).Macro (national) environment - larger societal forces that affect the microenvironment. Market segmentation pertains to the division of a market of consumers into persons with similar needs and wants. For instance, Kellogg's cereals, Frostiest are marketed to children. Crunchy Nut Cornflakes are marketed to adults. Both goods denote two products which are marketed to two distinct groups of persons, both with similar needs, traits, and wants. In another example, Sun Microsystems can use market segmentation to classify its clients according to their promptness to adopt new products. Market segmentation allows for a better allocation of a firm's finite resources. A firm only possesses a certain amount of resources. Accordingly, it must make choices (and incur the related costs) in servicing specific groups of consumers. In this way, the diversified tastes of contemporary Western consumers can be served better. With growing diversity in the tastes of modern consumers, firms are taking note of the benefit of servicing a multiplicity of new markets. Types of Market Research Market research, as a sub-set aspect of marketing activities, can be divided into the following parts:

Primary research (also known as field research), which involves the conduction and compilation of research for a specific purpose. Secondary research (also referred to as desk research), initially conducted for one purpose, but often used to support another purpose or end goal.

By these definitions, an example of primary research would be market research conducted into health foods, which is used solely to ascertain the needs/wants of the target market for health foods. Secondary research in this case would be research pertaining to health foods, but used by a firm wishing to develop an unrelated product.

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Primary research is often expensive to prepare, collect and interpret from data to information. Nevertheless, while secondary research is relatively inexpensive, it often can become outdated and outmoded, given that it is used for a purpose other than the one for which it was intended.

Primary research can also be broken down into quantitative research and qualitative research, which, as the terms suggest, pertain to numerical and non-numerical research methods and techniques, respectively. The appropriateness of each mode of research depends on whether data can be quantified (quantitative research), or whether subjective, non-numeric or abstract concepts are required to be studied (qualitative research). There also exist additional modes of marketing research, which are:

Exploratory research, pertaining to research that investigates an assumption. Descriptive research, which, as the term suggests, describes "what is". Predictive research, meaning research conducted to predict a future occurrence. Conclusive research, for the purpose of deriving a conclusion via a research process.

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Analyzing and Using Marketing Information

Information gathered in internal database and through marketing intelligence and marketing research usually requires additional analysis. And managers may need help applying the information to gain customer and marketing insights that will improve their marketing decisions. This help may include advanced statistical analysis to learn more about the relationships within a set of data. Information analysis might also involved the application of analytical models that will help marketers make better decisions. Marketing researchers collect and analyze all kinds of information in order to help companies improve their products, establish or modify sales and distribution policies, and make decisions regarding future plans and directions. In addition, research analysts are responsible for monitoring both in-house studies and off-site research, interpreting results, providing explanations of compiled data, and developing research tools. One area of marketing research focuses on company products and services. In order to determine consumer likes and dislikes, research analysts collect data on brand names, trademarks, product design, and packaging for existing products, items being test marketed, and those in experimental stages. Analysts also study competing products and services that are already on the market to help managers and strategic planners develop new products and create appropriate advertising campaigns. Once information has been gathered, marketing researchers analyze the findings. They then detail their findings and recommendations in a written report and often orally present them to management.

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Business Markets
The business market is huge. In fact, business markets involve far more dollars and items than do consumer markets. In some ways, business markets are similar to consumer markets. Both involve people who assume buying roles and make purchase decisions to satisfy needs. Marketing in businesses is different to marketing to consumers, although many of the techniques, such as branding, can be transferred successfully.

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Market Structure and Demand

In economics, market structure is the number of firms producing identical products which are homogeneous. The types of market structures include the following:

Monopolistic competition, also called competitive market, where there is a large number of firms, each having a small proportion of the market share and slightly differentiated products. Oligopoly, in which a market is dominated by a small number of firms that together control the majority of the market share. Duopoly, a special case of an oligopoly with two firms. Monopsony, when there is only one buyer in a market. Oligopsony, a market where many sellers can be present but meet only a few buyers. Monopoly, where there is only one provider of a product or service. Natural monopoly, a monopoly in which economies of scale cause efficiency to increase continuously with the size of the firm. A firm is a natural monopoly if it is able to serve the entire market demand at a lower cost than any combination of two or more smaller, more specialized firms. Perfect competition, a theoretical market structure that features no barriers to entry, an unlimited number of producers and consumers, and a perfectly elastic demand curve.

The imperfectly competitive structure is quite identical to the realistic market conditions where some monopolistic competitors, monopolists, oligopolists, and duopolists exist and dominate the market conditions. The elements of Market Structure include the number and size distribution of firms, entry conditions, and the extent of differentiation.

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These somewhat abstract concerns tend to determine some but not all details of a specific concrete market system where buyers and sellers actually meet and commit to trade. Competition is useful because it reveals actual customer demand and induces the seller (operator) to provide service quality levels and price levels that buyers (customers) want, typically subject to the sellers financial need to cover its costs. In other words, competition can align the sellers interests with the buyers interests and can cause the seller to reveal his true costs and other private information. In the absence of perfect competition, three basic approaches can be adopted to deal with problems related to the control of market power and an asymmetry between the government and the operator with respect to objectives and information: (a) subjecting the operator to competitive pressures, (b) gathering information on the operator and the market, and (c) applying incentive regulation.

Creating customer value satisfaction and loyalty

Managers who believe the customer is the companys only true profit center consider the traditional organization chart. Nowadays companies are facing a extremely hard competition and its basic to shift from a product sales strategy to a marketing strategy that focus to build long and strong customer relationships rather than making as much sales as possible. Many companies concentrate in make more and more sales thinking that this is the best way to increase profit. Most of the times they do not pay enough attention to retain customers because they put all efforts to make new customers. There is a lot of customer churn and it is

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very difficult to recover dissatisfied customers but its even more difficult to find new candidates which became first-time customers. Modern companies must work to create customer loyalty. Loyal customers are satisfied customers that will re-buy the service or product again and they wont change to another company easily. To accomplish that is mandatory to deliver high customer value and exceed customers expectations. Customer satisfaction will depend on product and service quality as well. In order to maximize customer satisfaction is necessary to build a total quality management (TQM) that is method to continuously improve the quality of the companies processes, products and services. That is the best way to assure customer loyalty, defense against competition and create a competitive advantage that competitors dont have. Marketers must assure to deliver high quality products and service to customers. This quality must be the quality that customer really want, for that reason the company final target is to fit the product to the customers needs and wants. With a total quality management program and a partner relationship management program with the participation of buyers and providers we will achieve this goal. More specifically is very interesting to concentrate on return on quality (ROQ) to assure that the quality of the product is in fact the quality that customer wants. It is very important to find out which are the most profitable customers and locate those that are less lucrative and should receive less attention. The company must focus to retain the most profitable customers more than get new customers. The value of long-term profitable customers is the most profitable asset for the company. There are a lot of ways to create loyalty and improve quality and satisfaction. For instance we must thing our customers as partners and create a really strong long relation, specially if we sell our products or services B2B. Many companies have a product sales strategy profile and do not pay attention to the customer value. Is very important to know if customers are satisfied and to know this we must monitor the customers through phone calls and periodic surveys. Another important point is to perform continuous trainings to our personnel and our clients. The idea is to change from a traditional organization chart into a modern customer-oriented chart. As a conclusion is essential to create partners instead of customers. If clients feel that they are involved with our company and in the design and improvement of the product they will continue being with us.

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Creating competitive advantage

Competitive Advantage Defined Creating competitive advantage in your product market boils down to two things: 1. Creating something different than your competitors 2. Creating something that your target customers perceive as much more valuable than their alternatives (including your direct competitors offerings, a home-growth solution, or doing nothing). Competitive advantage occurs when an organization acquires or develops an attribute or combination of attributes that allows it to outperform its competitors. These attributes can include access to natural resources, such as high grade ores or inexpensive power, or access to highly trained and skilled personnel human resources. New technologies such as robotics and information technology either to be included as a part of the product, or to assist making it.' Information technology has become such a prominent part of the modern business world that it can also contribute to competitive advantage by outperforming competitors with regard to internet presence.

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Competitive Strategies Cost Leadership Strategy The goal of cost leadership strategy is to produce products and services at the lowest cost in the industry. In other words to be the industry leader in low cost. An example is Wal-Mart, who uses an automated inventory replenishment system, which reduces inventory storage requirements and saves floor space. This allows for their retail stores to use the maximum amount of space for selling goods.

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Differentiation Strategy The goal of differentiation Strategy is to provide products that are different and offer more/different features than the competitors. An example is Southwest Airlines, has differentiated itself from the airline industry through its low cost and express service features. Innovation Strategy The goal of innovation strategy, is to provide new and different products/services, added features, and new ways of producing the product. An example is Citibank, which introduced ATM machines saving the company excessive amounts of money and provided them with a competitive advantage. Operational Effectiveness Strategy The goal of operational effectiveness is to perform internal business activities better than the competitors. This strategy attempts to increase quality, productivity, and employees and customers satisfaction with the company. Customer-Orientation Strategy The goal of customer-orientation strategy is to make the customers content. This strategy focuses on what the customer wants from the company and how to provide that. This strategy has been most effective with web based companies due to the one-to-one relationship. Technology-based competitive Strategy (Project Socrates) In the United States of America during the Reagan Administration, a team of experts led by Michael Sekora was brought together to 1) determine why US industries were losing their ability to compete in the world marketplace and 2) develop a solution to restore US industry's ability to compete. As a result, Project Socrates was initiated. The Socrates team launched one of the most in-depth research undertakings ever conducted in the US intelligence community, producing ten key findings that became the basis for the "Socrates technology-based competitive strategy" system, and support tools for developing and executing competitive strategies. The Socrates system was successfully deployed and considered instrumental in the economic recovery of the 1980s. However, early in the George H. W. Bush presidency, the program was de-funded by Bush for political reasons.

Marketing planning
The marketing planning process involves forging a plan for a firm's marketing activities. A marketing plan can also pertain to a specific product, as well as to an organization's overall marketing strategy. Generally speaking, an organization's marketing planning process is derived from its overall business strategy.

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Thus, when top management are devising the firm's strategic direction or mission, the intended marketing activities are incorporated into this plan. There are several levels of marketing objectives within an organization. The senior management of a firm would formulate a general business strategy for a firm. However, this general business strategy would be interpreted and implemented in different contexts throughout the firm.

Marketing strategy
The field of marketing strategy considers the total marketing environment and its impacts on a company or product or service. The emphasis is on "an in depth understanding of the market environment, particularly the competitors and customers." A given firm may offer numerous products or services to a marketplace, spanning numerous and sometimes wholly unrelated industries.

Accordingly, a plan is required in order to effectively manage such products. Evidently, a company needs to weigh up and ascertain how to utilize its finite resources. For example, a start-up car manufacturing firm would face little success should it attempt to rival Toyota, Ford, Nissan, Chevrolet, or any other large global car maker. Moreover, a product may be reaching the end of its life-cycle. Thus, the issue of divest, or a ceasing of production, may be made. Each scenario requires a unique marketing strategy. Listed below are some prominent marketing strategy models.

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A marketing strategy differs from a marketing tactic in that a strategy looks at the longer term view of the products, goods, or services being marketed. A tactic refers to a shorter term view. Therefore, the mailing of a postcard or sales letter would be a tactic, but a campaign of several postcards, sales letters, or telephone calls would be a strategy. Marketing specializations With the rapidly emerging force of globalization, the distinction between marketing within a firm's home country and marketing within external markets is disappearing very quickly. With this in mind, firms need to reorient their marketing strategies to meet the challenges of the global marketplace, in addition to sustaining their competitiveness within home markets. Marketing Promotion strategies Marketing promotion is divided in to two parts. Above the line promotion and below the line promotion. Above the line Above the line promotions primarily include mass media advertising; in mediums such as TV, radio, press, online Below the line Below the line promotion uses more niche focused mediums; such as email, community marketing, sms campaigns, personal sales, POS Buying behavior A marketing firm must ascertain the nature of customers' buying behavior if it is to market its product properly. In order to entice and persuade a consumer to buy a product, marketers try to determine the behavioral process of how a given product is purchased. Buying behavior is usually split into two prime strands, whether selling to the consumer, known as business-toconsumer (B2C), or to another business, known as business-to-business (B2B).B2C buying behavior This mode of behavior concerns consumers and their purchase of a given product. For example, if one imagines a pair of sneakers, the desire for a pair of sneakers would be followed by an information search on available types/brands. This may include perusing media outlets, but most commonly consists of information gathered from family and friends. If the information search is insufficient, the consumer may search for alternative means to satisfy the need/want. In this case, this may mean buying leather shoes, sandals, etc. The purchase decision is then made, in which the consumer actually buys the product. Following this stage, a post-purchase evaluation is often conducted, comprising an appraisal of the value/utility brought by the purchase of the sneakers. If the value/utility is high, then a repeat purchase may be made. This could then develop into consumer loyalty to the firm producing the sneakers.

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B2B buying behavior

Relates to organizational/industrial buying behavior. Business buy either wholesale from other businesses or directly from the manufacturer in contracts or agreements. B2B marketing involves one business marketing a product or service to another business. B2C and B2B behavior are not precise terms, as similarities and differences exist, with some key differences listed below: In a straight re-buy, the fourth, fifth and sixth stages are omitted. In a modified re-buy scenario, the fifth and sixth stages are precluded. In a new buy, all stages are conducted. Business buying behavior is influenced by economical, company, individual and interpersonal factors. Economical factors like regulatory changes, technology changes, competition, fiscal policy and monetary policy influence buying behavior. Company level factors also play a major role is deciding buying behavior. Sales people have to pay importance in understanding how purchase department is organized and players in the department. Although the goal of B2B marketing is to convert prospects into customers, the process is longer and more involved. A B2B company needs to focus on relationship building and communication using marketing activities that generate leads that can be nurtured during the sales cycle. B2B companies use marketing to educate various players in the target audience because the decision to purchase is usually a multi-step process involving more than one person.

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Customer Profile
Indus Motor Company (Toyota)
Product Line: Toyota XLI Toyota GLI Toyota Altis Toyota 2.OD Toyota Hilux

AIL supply shock absorbers & struts.

Indus Motor Company (Daihatsu)

Product Line: Daihatsu Cuore

AIL supply shock absorbers & struts. Pak Suzuki Motor Co.
Product Line: Bolan Cultus Mehran Alto Liana APV Swift

AIL supply shock absorbers & struts.

Dewan Farooq Motors

Product Line: Hyundai Santro Hyundai Shehzore Kia Classic Kia Sportage

AIL supply shock absorbers & struts.

Millat Tractors Ltd.

Product Line: MF 240,260, 350, 375, 385 & 385 4WD Millat Generators Set Millat Fork Lift Trucks

AIL supply steering box & camshaft.

Al-Ghazi Tractors Ltd.

Product Line: New Holland 480 New Holland 640

AIL supply camshaft.

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Atlas Honda Ltd.

Product Line: CD-70 CD-100 Pridor CG-125

AIL supply pipe fork, case damper & piston rods.

Sazgar Engineering Works Ltd.

Product Line: Mini Cab CNG Rikshaw Tempo delivery Van Wheel Rims for Tractors

AIL supply shock absorbers.

Hinopak Motors.
Product Line: Buses Trucks

AIL supply shock absorbers. Sindh Engineering.

Product Line: Mazda T-3500 Dong Feng

AIL supply shock absorbers.

Master Motor Corporation.

Product Line: Master Highland Mazda Master Buses

AIL supply shock absorbers.

Adam Motors Co. Ltd.

Product Line:

Revo Car (Production ceased)

AIL supply shock absorbers. Nissan Ghandhara.

Product Line: Nissan Sunny Car Buses/Trucks

AIL supply shock absorbers.

Dawood Yamaha.
Product Line: YD-70 YD-100 Mini-100

AIL supply pipe fork & case dampers.

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Internal Assessment Strength:

1. Technical collaboration with Kayaba Japan and Gabriel USA. 2. Group Company of House of Habib. 3. ISO 9000 and TS-16949 certified. 4. Having Research & Development facility. 5. Enough capacity to meet customer requirements. 6. Company is equipped with latest technological machineries. 7. Single source in Pakistan for manufacturing of Shocks & Struts for all OEMs. 8. Good financial position. 9. Offer 6-months warranty policy on shock absorbers & struts.

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Weaknesses:

1. Demand of product depends on OEMs not directly to the consumers. 2. Slow moving products are still producing which effect on flexibility and cost. 3. High employees turn over due to distance and location of factory which is at Hub Chowki Baluchistan. 4. Strong influence of labor union.

External Assessment Opportunities:

1. Country laws encourage import of vehicles, Agriauto can develop shocks & Strut for imported vehicles such as: Vitz, Platz. 2. Increase in new entries of motor cycle assembler and CNG Rickshaw encourage Agriauto to provide them Shocks assembly. 3. Localization of new Suzuki & Toyota cars Swift and Corolla provide opportunity to Agriauto for development of body parts.

Threats:

1. Increase in price of raw material cause decrease in profit. 2. Decrease in OEMs production due to higher prices (4 wheeler and two wheeler) effect on sales of dependent industries. 3. Customers new policy of developing dual source of critical parts effect on sales.

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EFE MATRIX (External Factor Evaluation)

S/NO. KEY EXTERNAL FACTORS WEIGHT RATING WEIGHTED SCORE

Opportunities Country laws encourage import of vehicles, Agriauto can develop shocks & Strut for imported vehicles such as: Vitz, Platz, Probox, Passo & Premio. Increase in new entries of motor cycle assembler and CNG Rickshaw encourage Agriauto to provide them Shocks assembly. Localization of new Suzuki & Toyota cars Swift and Corolla provide opportunity to Agriauto for development of body parts. Threats

0.2

0.6

0.15

0.3

0.25

Increase in price of raw material cause decrease in profit. Decrease in OEMs production due to higher prices (4 wheeler) effect on sales of dependent industries. Customers new policy of developing dual source of critical parts effect on sales

0.2

0.8

0.13

0.39

0.07

0.07

Total

3.16

Total weighted score of 3.16 is above the average of 2.5, so Agriauto industries is doing well, taking advantage of external opportunities and avoiding the threats facing the firm. There is still room for improvement.

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IFE MATRIX (Internal Factor Evaluation)

S/NO. KEY EXTERNAL FACTORS Strength 1 2 3 4 5 6 Technical collaboration with Kayaba Japan and Gabriel America. Group Company of House of Habib. ISO 9000 and TS16949 certified. Having Research & Development facility. Enough capacity to meet customer requirements. Company is equipped with latest technological machineries. Single source in Pakistan for manufacturing of Shocks & Struts for all OEMs. Good financial position. Weakness 1 Demand of product depends on OEMs not directly to the consumers. Slow moving products are still producing which effect on flexibility and cost. High employees turn over due to distance and location of factory which is at Hub Chowki Baluchistan. Strong influence of labor union. Total 0.12 2 0.24 0.07 0.06 0.07 0.06 0.11 0.08 4 3 3 4 3 4 0.28 0.18 0.21 0.24 0.33 0.32 WEIGHT RATING WEIGHTED SCORE

7 8

0.15 0.09

4 3

0.6 0.27

0.04

0.08

0.05

0.05

0.1 1

0.1 2.9

Total weighted score of 2.9 is above the average of 2.5, so Agriauto industries is doing well but still need to improve the performance to meet the weighted score of 4.0

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BCG MATRIX (Boston Consulting Group)

Division 1 2 3 4 5 Plants Shocks & Struts Press Parts Tractor 2- Wheeler Others ( Door Hinges) Total Sales (Million) 3292.57 47.45 233.47 331.07 93.84 3998.39 Sales (%) 82.35 1.19 5.84 8.28 2.35 100.0 RMSP 0.80 0.20 0.70 0.70 0.30 IG Rate (%) 12% 5% -3% 15% 6%

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The Companys Microenvironment

Marketing managements job is to build relationships with customers by creating customer value and satisfaction. However, marketing managers cannot do this alone. Marketing success will require building relationships with other company departments, suppliers, marketing, intermediaries, customers, competitors, and various publics, which combine to make up the companys value delivery network.

Marketing The Company Suppliers Marketing intermediaries Competitors Publics

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The Company In designing marketing plans, marketing management takes other company groups into account-groups such as top management, finance, research and development (R&D), purchasing, operations, and accounting. All these interrelated groups form the internal environment. Top management sets the companys mission, objectives, broad strategies, and policies. Marketing managers make decisions within the strategies and plans made by top management. Marketing managers must work closely with other company departments. Other departments have an impact on the marketing departments plans and actions. And under the marketing concept, all of these functions must think consumer. They should work in harmony to provide superior customer value and satisfaction.

Suppliers

Suppliers form an important link in the companys overall customer alue delivery system. They provide the resources needed by the company to product its goods and services. Supplier problems can seriously affect marketing. Marketing managers must watch supply availability supply shortages or delays, labor strikes, and other events can cost sales in the short run and damage customer satisfaction in the long run. Marketing managers also monitor the price trends of their key inputs. Rising supply costs may force price increases that can harm the companys sales volume. Most marketers today treat their suppliers as partners in creating and delivering customer value.

Marketing Intermediaries

Firms that help the company to promote, sell, and distribute its goods to final buyers; they include resellers, physical distribution firms, marketing service agencies, and financial intermediaries.

Customers

The company needs to study five types of customer markets closely. Consumer markets consist of individuals and households that buy goods and services for personal consumption. Business markets buy goods and services for further processing or for use in their production process, whereas reseller markets buy goods and services to resell at a profit. Government markets are made up of government agencies that buy goods and services to produce that need them

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finally, international markets consist of these buyers in other countries, including consumers, producers, resellers and governments. Each market type has special characteristics that call for careful study by the seller. Competitors

The marketing concept states that to be successful, a company must provide greater customer value and satisfaction than its competitors do. Thus marketers must do more than simply adapt to the needs of target consumers. They also must gain strategic advantage by positioning their offerings strongly against competitors offering in the minds of consumers. No single competitive marketing strategy is best for all companies. Each firm should consider its own size and industry position compared to those of its competitors. Large firms with dominant positions in an industry can use certain strategies that smaller firms cannot afford. But being large is not enough. There are winning strategies for large firms, but there are also losing ones. And small firms can develop strategies that give them better rates of return that large firms enjoy. Public Any group that has an actual or potential interest in or impact on an organizations ability to achieve its objectives

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The Companys Macro environment or Macro Environment

The company and all of the other actors operate in a larger macro environment of forces that shape opportunities and pose threats to the company. The six major forces in the companys macro environment. We examine these forces and show how they affect marketing plans. Company Demographic Forces Economic Forces Natural Forces Technological Forces Political Forces Cultural Force

Demographic Environment

The study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics

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The demography environment is of major interest to marketers because it involves people, and people make up markets. The world population is growing at an explosive rate. It now exceeds 6.5 billion people and will exceed 8.1 billion by the year 2030. The worlds large and highly diverse population poses both opportunities and challenges. Changes in the world demographic environment have major implications for business. Economic Environment Factors that affect consumer buying power and spending patterns Markets require buying power as well as people. The economic environment consists of factors that affect consumer purchasing power and spending patterns. Nations vary greatly in their levels and distribution of income. Some countries gave subsistence economies, they consumer most of their own agricultural and industrial output. These countries offer few markets opportunities. At the other extremes are industrial economies, which constitute rich markets for many different kinds of goods. Marketers must pay close attention to major trends and consumer spending patterns both across and within their world markets. Natural Environment Natural resources that are needed as inputs by marketers or that are affected by marketing activities The Natural Environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities. Environmental concerns have grown steadily during the past three decades. In many cities around the world, air and water pollution have reached dangerous levels. World concern continues to mount about the possibilities of global warming, and many environmentalists fear that we soon will be buried in our own trash. A second environmental trend is increased pollution; industry will almost always damage the quality of the natural environment. Consider the disposal of chemical and nuclear wastes; the dangerous mercury levels in the ocean; the quantity of chemical pollutants in the soil and food supply; and the littering of the environment with no biodegradable bottles, plastics, and other packaging materials. A third trend is increased government intervention in natural resource management. The governments of different countries vary in their concern and efforts to promote a clean environment. Some, like the German government, vigorously pursue environmental quality. Others, especially many poorer nations, do little about pollution largely because they lack the deeded funds or political will. Even the richer nations lack the vast funds and political needed to mount a worldwide environmental effort. The general hope is that companies found the world will accept more social responsibility, and that less expensive devices can be found to control and reduce pollution.

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Technological Environment Forces that create new technologies, creating new product and market opportunities The technological environment is perhaps the most dramatic force now shaping our destiny. Technology has released such wonders as antibiotics, robotic surgery, miniaturized electronics, laptop computers, and the internet. It has released such mixed blessings as the automobile, television, and credit cards. Our attitude toward technology depends on whether we are more impressed with its wonders or its blunders. For example, what would you think about having tiny little transmitters implanted in all of the products you buy that would allow tracking products from their advantages to both buyers and sellers. On the other hand, it could be a bit scary. Either way, its already happening. Political Environment Laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a giver society Cultural Environment Institutions and other forces that affect societys basic values, perceptions, preferences, and behaviors The cultural environment is made up of institutions and other forces that affect societys basic values, perceptions, preferences, and behaviors. People grow up in a particular society that shapes their basic beliefs and values. They absorb a worldview that defines their relationships with others. The following cultural characteristics can affect marketing decision making. i. Persistence of Cultural Values People in given society holds many beliefs and values. Their core beliefs and values have a high degree of persistence. For example most Americans believe in working, getting married, giving to charity, and being honest. Secondary beliefs and values are more open to change. Believing in marriage is a core belief; believing that people should get married early in life is a secondary belief. Marketers have some chance of changing secondary values but little chance of changing core values. For example, family planning marketers could argue more effectively that people should get married later in life than that they should not get married at all. ii. Shifts in Secondary Cultural Values

Although core values are fairly persistent, cultural swings do take place. Consider the impact of popular music groups, movie personalities, and other celebrities on young peoples hairstyling and clothing norms. Marketers want to predict cultural shifts in order to spot new opportunities or threats. Several firms offer futures forecasts in this connection.

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Corporate Social Responsibility (CSR)

Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business/ Responsible Business)[1] is a form of corporate self-regulation integrated into a business model. CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. CSR is a process with the aim to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders.

The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. It was used to describe corporate owners beyond shareholders as a result of an influential book by R. Edward Freeman, Strategic management: a stakeholder approach in 1984.[2] Proponents argue that corporations make more long term profits by operating with a perspective, while critics argue that CSR distracts from the economic role of businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a watchdog over powerful multinational corporations. CSR is titled to aid an organization's mission as well as a guide to what the company stands for and will uphold to its consumers. Development business ethics is one of the forms of applied ethics that examines ethical principles and moral or ethical problems that can arise in a business environment. ISO 26000 is the recognized international standard for CSR. Public sector organizations (the United Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar principles but with no formal act of legislation. The UN has developed the Principles for Responsible Investment as guidelines for investing entities.

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Social accounting, auditing, and reporting For a business to take responsibility for its actions, that business must be fully accountable. Social accounting, a concept describing the communication of social and environmental effects of a company's economic actions to particular interest groups within society and to society at large, is thus an important element of CSR. Social accounting emphasizes the notion of corporate accountability. D. Crowther defines social accounting in this sense as "an approach to reporting a firms activities which stresses the need for the identification of socially relevant behavior, the determination of those to whom the company is accountable for its social performance and the development of appropriate measures and reporting techniques." In any case, companies are now expected to perform well in non-financial areas such as human rights, business ethics, environmental policies, corporate contributions, community development, corporate governance, and workplace issues. Some examples of CSR are safe working conditions for employees, environmental stewardship, and contributions to community groups and charities. The problem is that many companies that claim to be socially responsible often do not live up to such a standard. Because CSR is becoming more commonplace among corporations, there are concerns that some companies promote an image of CSR whether or not they have a true strategy in place and the results to show for. Accountability and transparency are key to conducting business in a responsible manner.

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Agriauto efforts for CSR

As a responsible corporate entity, Agriauto has contributed Rs.8.3 million to various NGOs/Institution working towards betterment of humanity. The company contributes 1% of PBT towards CSR.

1. Continued Support to Medical and Educational Institutes at Hub. The company has made concerted efforts to improve the medical facilities of Jam Ghulam Qadir Hospital at Hub with mutual consultation of the hospital authorities. Agriauto continues its efforts in uplifting educational facilities at Hub. For the new academic year, books, stationary, and uniforms were donated to the needy students of the School. 2. Contribution to Educational institute for underprivileged The garage school is devoted toward providing better education to the underprivileged, residing in Karachi. To support them in this noble cause, following donations were made for; Purchase of desk and chairs for the classrooms. Setting up of a lab with basic chemistry practical facilities. For purchase of new building. 3. Provision of Rations The company regularly provides assistance to the local community. This year rations were distributed to over 200 poor/needy families and widows in Hub.

Contribution to National Exchequer

During the year Agriauto company contributed 1.2 billion to the National exchequer.

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Human Resource Management

Human resource management (HRM or simply HR) is the management of an organization's workforce, or human resources. It is responsible for the attraction, selection, training, assessment, and rewarding of employees, while also overseeing organizational leadership and culture, and ensuring compliance with employment and labor laws. In circumstances where employees desire and are legally authorized to hold a collective bargaining agreement, HR will typically also serve as the company's primary liaison with the employees' representatives (usually a labor union). HR is a product of the human relations movement of the early 20th century, when researchers began documenting ways of creating business value through the strategic management of the workforce. The function was initially dominated by transactional work such as payroll and benefits administration, but due to globalization, company consolidation, technological advancement, and further research, HR now focuses on strategic initiatives like mergers and acquisitions, talent management, succession planning, industrial and labor relations, and diversity and inclusion.

In startup companies, HR's duties may be performed by a handful of trained professionals or even by non-HR personnel. In larger companies, an entire functional group is typically dedicated to the discipline, with staff specializing in various HR tasks and functional leadership engaging in strategic decision making across the business. To train practitioners for the profession, institutions of higher education, professional associations, and companies themselves have created programs of study dedicated explicitly to the duties of the function. Academic and practitioner organizations likewise seek to engage and further the field of HR, as evidenced by several field-specific publications.

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Human Resource at Agriauto industries

Agriauto Industries employees come from diverse backgrounds. Such a workforce must be supported by an environment that encourages innovative and strategic thinking at all levels. The HR department is consistently and creatively meeting this objective. Employee training and development remained the prime focus, and several foreign, Ex-house and In-house trainings were imparted to Officers and workers, aiming towards establishing higher standards and expectations pertaining to their respective roles. The feedback from participants was overwhelmingly positive. To enhance and optimize the productivity levels of our team members, motivational and Reward and recognition strategies continue to be implemented religiously.

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Customer Relationship Management

Customer relationship management (CRM) is a model for managing a companys interactions with current and future customers. It involves using technology to organize, automate, and synchronize sales, marketing, customer service, and technical support.

Customer relationship management (CRM) is a widely implemented model for managing a companys interactions with customers and prospects. It involves using technology to organize, automate, and synchronize business processesprincipally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, service and retain those the company already has, entice former clients to return, and reduce the costs of marketing and client service. Customer relationship management describes a company-wide business strategy including customer-interface departments as well as other departments. Measuring and valuing customer relationships is critical to implementing this strategy. Benefits of customer relationship management A customer relationship management system may be chosen because it is thought to provide the following advantages.

Decrease in overall costs Increase profitability

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Challenges Successful development, implementation, use and support of customer relationship management systems can provide a significant advantage to the user, but often there are obstacles that obstruct the user from using the system to its full potential. Instances of a CRM attempting to contain a large, complex group of data can become cumbersome and difficult to understand for ill-trained users. The lack of senior management sponsorship can also hinder the success of a new CRM system. Stakeholders must be identified early in the process and a full commitment is needed from all executives before beginning the conversion. But the challenges faced by the company will last longer for the convenience of their customers.

Additionally, an interface that is difficult to navigate or understand can hinder the CRMs effectiveness, causing users to pick and choose which areas of the system to be used, while others may be pushed aside. This fragmented implementation can cause inherent challenges, as only certain parts are used and the system is not fully functional. The increased use of customer relationship management software has also led to an industry-wide shift in evaluating the role of the developer in designing and maintaining its software. Companies are urged to consider the overall impact of a viable CRM software suite and the potential for good or bad in its use. Complexity Tools and workflows can be complex, especially for large businesses. Previously these tools were generally limited to simple CRM solutions which focused on monitoring and recording interactions and communications. Software solutions then expanded to embrace deal tracking, territories, opportunities, and the sales pipeline itself. Next came the advent of tools for other client-interface business functions, as described below. These tools have been, and still are, offered as on-premises software that companies purchase and run on their own IT infrastructure. Poor usability One of the largest challenges that customer relationship management systems face is poor usability. With a difficult interface for a user to navigate, implementation can be fragmented or not entirely complete.

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The importance of usability in a system has developed over time Customers are likely not as patient to work through malfunctions or gaps in user safety, and there is an expectation that the usability of systems should be somewhat intuitive: it helps make the machine an extension of the way I think not how it wants me to think. An intuitive design can prove most effective in developing the content and layout of a customer relationship management system. Two 2008 case studies show that the layout of a system provides a strong correlation to the ease of use for a system and that it proved more beneficial for the design to focus on presenting information in a way that reflected the most important goals and tasks of the user, rather than the structure of the organization. This ease of service is paramount for developing a system that is usable. In many cases, the growth of capabilities and complexities of systems has hampered the usability of a customer relationship management system. An overly complex computer system can result in an equally complex and non-friendly user interface, thus not allowing the system to work as fully intended. This bloated software can appear sluggish and/or overwhelming to the user, keeping the system from full use and potential. A series of 1998 research indicates that each item added to an information display can significantly affect the overall experience of the user.

Fragmentation Often, poor usability can lead to implementations that are fragmented isolated initiatives by individual departments to address their own needs. Systems that start disunited usually stay that way: CRM and decision processes frequently lead to separate and incompatible systems, and dysfunctional processes. A fragmented implementation can negate any financial benefit associated with a customer relationship management system, as companies choose not to use all the associated features factored when justifying the investment. Instead, it is important that support for the CRM system is companywide. The challenge of fragmented implementations may be mitigated with improvements in late-generation CRM systems.

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Business reputation Building and maintaining a strong business reputation has become now increasingly challenging. The outcome of internal fragmentation that is observed and commented upon by customers is now visible to the rest of the world in the era of the social customer; in the past, only employees or partners were aware of it. Addressing the fragmentation requires a shift in philosophy and mindset in an organization so that everyone considers the impact to the customer of policy, decisions and actions. Human response at all levels of the organization can affect the customer experience for good or ill. Even one unhappy customer can deliver a body blow to a business. Some developments and shifts have made companies more conscious of the life-cycle of a customer relationship management system. Companies now consider the possibility of brand loyalty and persistence of its users to purchase updates, upgrades and future editions of software. Additionally, CRM systems face the challenge of producing viable financial profits, with a 2002 study suggesting that less than half of CRM projects are expected to provide a significant return on investment. Poor usability and low usage rates lead many companies to indicate that it was difficult to justify investment in the software without the potential for more tangible gains.

Security, privacy, and data security concerns One function of CRM is to collect information about clients. It is important to consider the customers' need for privacy and data security. Close attention should be paid to relevant laws and regulations. Vendors may need to reassure clients that their data not be shared with third parties without prior consent, and that illegal access can be prevented. A large challenge faced by developers and users is found in striking a balance between ease of use in the CRM interface and suitable and acceptable security measures and features. Corporations investing in CRM software do so expecting a relative ease of use while also requiring that customer and other sensitive data remain secure. This balance can be difficult, as many believe that improvements in security come at the expense of system usability. Research and study show the importance of designing and developing technology that balances a positive user interface with security features that meet industry and corporate standards.

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Types/variations Sales force automation Sales force automation (SFA) uses software to streamline the sales process. Marketing: CRM systems for marketing track and measure campaigns over multiple channels, such as email, search, social media, telephone and direct mail. Customer service and support: CRMs can be used to create, assign and manage requests made by customers, such as call center software which help direct customers to agents. Appointments: Appointment CRMs automatically provide suitable appointment times to customers via e-mail or the web, which are then synchronized with the representative or agent's calendar. Analytics: Sales analytics monitor client actions and preferences and augment sales forecasts and help measure the effectiveness of marketing campaigns. Small business: For small businesses a CRM may simply consist of a contact manager system which integrates emails, documents, jobs, faxes, and scheduling for individual accounts. Social media: Some CRMs coordinate with social media sites like Twitter, LinkedIn, Face book and Google Plus to track and communicate with customers who share opinions and experiences about their company, products and services. Non-profit and membership-based: Systems for non-profit and membership-based organizations help track constituents, fund-raising, demographics, membership levels, membership directories, volunteering and communications with individuals.

CRM at Agriauto industries

Agriauto Industries get feedback and keep in touch with their customer through their Mobile Team (North & South). These teams regularly visits the markets and collect feedback and resolve the issue if any found.

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Agriauto Industries Six year at a glance

Rs.000

Return on Equity

22.79%

20.41%

21.69%

18.96%

22.40% 28.17%

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Agriauto Industries Financial Highlights

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Health, Safety and Environment (HSE)

Environment, Health and Safety (EHS) also Safety, Health and Environment (SHE) or HES or HSE is often used as the name of a department in corporations and government agencies. The EHS guidelines were created by the International Finance Corporation in 1998. Organizations based in the United States are subject to EHS regulations found in Code of Federal Regulations, particularly 29, 40, and 49 Companies that aspire to be better environmental stewards invest in strong environmental, health and safety management, otherwise known as EHS. From an environmental standpoint, it involves creating a systematic approach to managing waste, complying with environmental regulations, or reducing the companys carbon footprint. Successful EHS programs also include measures to address ergonomics, air quality, and other aspects of workplace safety that could affect the health and well-being of employees.

"Occupational health should aim at: the promotion and maintenance of the highest degree of physical, mental and social well-being of workers in all occupations; the prevention amongst workers of departures from health caused by their working conditions; the protection of workers in their employment from risks resulting from factors adverse to health; the placing and maintenance of the worker in an occupational environment adapted to his physiological and psychological capabilities; and, to summarize, the adaptation of work to man and of each man to his job.

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Significance of HSE
A growing number of rules and policies affecting Health, Safety and Environmental ("HSE") compliance are being issued by such diverse groups as the United States Sentencing Commission, the Occupational Standards and Health Administration, ("OSHA"), and the International Standards Organization ("ISO"), thus giving companies more reasons to consider adopting voluntary HSE programs. Here are some of the more significant of these rules and policies:

Federal Court Requirements. The Federal Sentencing Guidelines already encourage companies to adopt reporting and compliance programs (See my article in the previous issue.) Furthermore, a set of similar guidelines specifically targeted at environmental crimes may be enacted by the Sentencing Commission soon. Governmental Standards for Legal Action. The enforcement policies of the Department of Justice, EPA and state environmental protection agencies now provide a basis for dropping charges under environmental laws in the accused company voluntarily discloses the violation, cooperates with governmental investigations, implements preventive measures, and enforces an internal compliance program. Occupational Health and Safety Standards. The Occupational Safety and Health Administration's ("OSHA"'s) Voluntary Compliance Program allows companies to reduce the number of government inspections by adopting an OSHA voluntary compliance program. International Standards. The proposed ISO 14000 standards will, when adopted, provide incentives to companies to meet self auditing and environmental management standards that are similar to incentives under the ISO 9000 quality standards. Confidentiality of Audits. A growing number of states (Oregon, Indiana, Kentucky, Colorado) provide that corporations performing environmental audits may protect their audit and related documents from disclosure (the "Self Evaluative Privilege").

Moreover, criminal enforcement of HSE laws and increased policing by state and federal agencies evidence greater legal risks to companies that fail to adopt and maintain HSE compliance programs.

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The following actions are recommended for a company to implement a cost effective HSE compliance program: 1. Make managers responsible for continuous monitoring of HSE compliance. HINT: For every documented problem, also document all steps taken to correct the problem. 2. Adopt an HSE compliance policy and communicate that policy to employees. HINT: Consolidate various HSE programs into one comprehensive program, thus maximizing communication. 3. Establish procedures for internal audits, internal reporting of violations and documenting the resolution of problems. HINT: Conduct audit programs with counsel to take advantage of the attorney-client privilege; since the privilege is subject to exceptions, document all corrective and preventive measures taken. 4. Train employees at all levels; maintain regulatory expertise; and evaluate employees' performance of HSE duties. HINT: Impress upon upper level management the importance of HSE compliance and their responsibility for the program. 5. Offer incentives for compliance. HINT: Provide the largest incentives for total environmental quality, e.g., waste minimization, toxic use reduction, etc. and integrate these incentives with corporate goals such as increased productivity and efficiency. 6. Establish disciplinary procedures. HINT: Ensure the discipline of employees who either fail to report violations, interfere with the reporting of violations, or fail to cooperate with auditing. 7. Continuously evaluate and improve your company's HSE compliance program. HINT: Periodically, obtain an outside assessment of your compliance program.

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HSE at Agriauto Industries

Agriauto Industries management firmly believes that effective management and implementation of workplace safety, health and environment programs add significant value to individuals and companies by reducing the work-related injuries and illnesses. To achieve this objective, a SHE Steering Committee comprising of Top management and Head of department has been formed, responsible for monitoring progress of Risk Assessment Activities and actions taken after assessments.

Provision of Safety Walk Ways, Fire Assembly Points and Weekly Safety Walks are recent achievements of SHE Department. A dedicated person has also been hired to monitor the accidents and to devise countermeasures. Agriauto Company aggressively pursued the 5S activities throughout the year to clean up and uplifts the conditions of the facility. The work place is now more workers friendly and the customers visiting our facility are appreciating the efforts we made.

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5S Model
5S is the name of a workplace organization method that uses a list of five Japanese words: seiri, seiton, seiso, seiketsu, and shitsuke. Transliterated or translated into English, they all start with the letter "S". The list describes how to organize a work space for efficiency and effectiveness by identifying and storing the items used, maintaining the area and items, and sustaining the new order. The decision-making process usually comes from a dialogue about standardization, which builds understanding among employees of how they should do the work.

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The 5S Phases There are five primary 5S phases: sorting, set in order, systematic cleaning, standardizing, and sustaining. Sorting Eliminate all unnecessary tools, parts, and instructions. Go through all tools, materials, and so forth in the plant and work area. Keep only essential items and eliminate what is not required, prioritizing things per requirements and keeping them in easily-accessible places. Everything else is stored or discarded. Straightening or Setting in Order Arranging tools, parts, and instructions in such a way that the most frequently used items are the easiest and quickest to locate. The purpose of this step is to eliminate time wasted in obtaining the necessary items for an operation. Sweeping or Shine Clean the workspace and all equipment, and keep it clean, tidy and organized. At the end of each shift, clean the work area and be sure everything is restored to its place. This makes it easy to know what goes where and ensures that everything is where it belongs. Standardizing All work stations for a particular job should be identical. All employees doing the same job should be able to work in any station with the same tools that are in the same location in every station. Everyone should know exactly what his or her responsibilities are for adhering to the first 3 esses. Synonym : Systemize Sustaining the Practice Maintain and review standards. Once the previous 4 esses have been established, they become the new way to operate. Maintain focus on this new way and do not allow a gradual decline back to the old ways. While thinking about the new way, also be thinking about yet better ways. When an issue arises such as a suggested improvement, a new way of working, a new tool or a new output requirement, review the first 4 esses and make changes as appropriate. It should be made as a habit and be continually improved.

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Kaizen Concept
Kaizen (?), Japanese for "improvement", or "change for the better" refers to philosophy or practices that focus upon continuous improvement of processes in manufacturing, engineering, and business management. It has been applied in healthcare, psychotherapy, life-coaching, government, banking, and other industries. When used in the business sense and applied to the workplace, kaizen refers to activities that continually improve all functions, and involves all employees from the CEO to the assembly line workers. It also applies to processes, such as purchasing and logistics, that cross organizational boundaries into the supply chain. By improving standardized activities and processes, kaizen aims to eliminate waste (see lean manufacturing). Kaizen was first implemented in several Japanese businesses after the Second World War, influenced in part by American business and quality management teachers who visited the country. It has since spread throughout the world and is now being implemented in many other venues besides just business and productivity.

The five main elements of kaizen

Management teamwork Increased labor responsibilities Increased management morale Quality circles Management suggestions for labor improvement

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5S & Kaizen at Agriauto industries

The bar for Kaizen and 5S has been raised with the implementation of Step-up plan. An excellent way to develop the disciplines necessary for learn implementation and to make improvements by involving employees at all levels. Mr. Masaki Ota, who joined the company in the year 2010 as Technical Advisor. Mr. Masaki Ota made significant changes in the appearance of the plants and motivated all members to focus on the 5S and Kaizen activities.

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Future Challenges to Agriauto Industries

Influx of the used cars Automotive industry undergoes significant structural challenges in an uncertain world economic climate. Face a new challenges of cost structure Reducing profitability & increasing financial and bankruptcy risk Ban on import of CNG kits Food, health and shelter for human Threats of opening up trade with India Imposing of sale tax on tractors Fuel & CNG price Shortage problem of fuel Poor political & economic condition Import of used shock absorbers & struts.

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Up-gradation of manufacturing facilities

This year plant & machinery worth Rs.155.363 million were added mainly to increase the productivity and quality of our products. All investments are approved only after detailed scrutiny and cost/benefit analysis.

Key investments during the year were on the following;

Centralized Parting Cell The company used to part off its tubes & rods at two different locations without having storage facility in the past. Due to the similar nature of operation at these locations it was felt that these operations could be combined at one location along-with the material. The project was successfully completed during the year and there has been savings on account of manpower, efficiency and proper control over the material. Straightening & CNC Grinding Machine In order to improve the quality of the front Pipe Forks being supplied to Atlas Honda Motorcycles and anticipating a healthy growth in the two wheeler segment this investment was initiated. After the induction of these machines your company would be able to produce 60,000 pipe forks in a month which can cater for the monthly production of 30,000 motorcycles. Damping Force Testing Machine This machine is used for final checking of the shock absorbers for passenger cars. The machine clears the shocks for onward supply to customer after evaluating the damping in accordance with the standards. This is the additional machine as a back-up of the existing machine which is 5-years old. Welding Machines The entire welding line for the passenger car shock absorbers was changed in the year with new and power efficient machines. Torquing & Riveting Machine There was an abnormal in-house rejection of shock absorbers on account of riveting. After assessment it was revealed that the problem is with the Torquing and riveting machine. The matter was then discussed with the Technical partner, KYB and this machine has been added on their recommendation.

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Political, Economic, Social, and Technological analysis (PEST)

PEST analysis stands for "Political, Economic, Social, and Technological analysis" and describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. Some analysts added Legal and rearranged the mnemonic to SLEPT; inserting Environmental factors expanded it to PESTEL or PESTLE, which is popular in the United Kingdom. The model has recently been further extended to STEEPLE and STEEPLED, adding Ethics and demographic factors. It is a part of the external analysis when conducting a strategic analysis or doing market research, and gives an overview of the different macro environmental factors that the company has to take into consideration. It is a useful strategic tool for understanding market growth or decline, business position, potential and direction for operations. The growing importance of environmental or ecological factors in the first decade of the 21st century have given rise to green business and encouraged widespread use of an updated version of the PEST framework. STEER analysis systematically considers Socio-cultural, Technological, Economic, Ecological, and Regulatory factors.

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Composition

Political factors are basically to what degree the government intervenes in the economy. Specifically, political factors include areas such as tax policy, labor law, environmental law, trade restrictions, tariffs, and political stability. Political factors may also include goods and services which the government wants to provide or be provided (merit goods) and those that the government does not want to be provided (demerit goods or merit bads). Furthermore, governments have great influence on the health, education, and infrastructure of a nation Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. For example, interest rates affect a firm's cost of capital and therefore to what extent a business grows and expands. Exchange rates affect the costs of exporting goods and the supply and price of imported goods in an economy Social factors include the cultural aspects and include health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect the demand for a company's products and how that company operates. For example, an aging population may imply a smaller and less-willing workforce (thus increasing the cost of labor). Furthermore, companies may change various management strategies to adapt to these social trends (such as recruiting older workers). Technological factors include technological aspects such as R&D activity, automation, technology incentives and the rate of technological change. They can determine barriers to entry, minimum efficient production level and influence outsourcing decisions. Furthermore, technological shifts can affect costs, quality, and lead to innovation. Environmental factors include ecological and environmental aspects such as weather, climate, and climate change, which may especially affect industries such as tourism, farming, and insurance. Furthermore, growing awareness of the potential impacts of climate change is affecting how companies operate and the products they offer, both creating new markets and diminishing or destroying existing ones. Legal factors include discrimination law, consumer law, antitrust law, employment law, and health and safety law. These factors can affect how a company operates, its costs, and the demand for its products.

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What is ERP?
ERP software (or enterprise resource planning software) is an integrated system used by businesses to combine, organize and maintain the data necessary for operations. ERP systems merge each of the companys key operations, including the manufacturing, distribution, financial, human resources and customer relations departments, into one software system. For many companies, the ERP software is the heart of their operations and the backbone of the organization. Enterprise resource planning software, or ERP, doesnt live up to its acronym. Forget about planningit doesnt do much of thatand forget about resource, a throwaway term. But remember the enterprise part. This is ERPs true ambition. It attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments particular needs. That is a tall order, building a single software program that serves the needs of people in finance as well as it does the people in human resources and in the warehouse. Each of those departments typically has its own computer system optimized for the particular ways that the department does its work. But ERP combines them all together into a single, integrated software program that runs off a single database so that the various departments can more easily share information and communicate with each other. That integrated approach can have a tremendous payback if companies install the software correctly. How can ERP improve a companys business performance? ERPs best hope for demonstrating value is as a sort of battering ram for improving the way your company takes a customer order and processes it into an invoice and revenueotherwise known as the order fulfillment process. That is why ERP is often referred to as back-office software. It doesnt handle the up-front selling process (although most ERP vendors have developed CRM software or acquired pure-play CRM providers that can do this); rather, ERP takes a customer order and provides a software road map for automating the different steps along the path to fulfilling it. When a customer service representative enters a customer order into an ERP system, he has all the information necessary to complete the order (the customers credit rating and order history from the finance module, the companys inventory levels from the warehouse module and the shipping docks trucking schedule from the logistics module, for example).

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People in these different departments all see the same information and can update it. When one department finishes with the order it is automatically routed via the ERP system to the next department. To find out where the order is at any point, you need only log in to the ERP system and track it down. With luck, the order process moves like a bolt of lightning through the organization, and customers get their orders faster and with fewer errors than before. ERP can apply that same magic to the other major business processes, such as employee benefits or financial reporting.

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ERP Solution
Agriauto Industries Limited has recently adopted Enterprise Resource Planning Software-SAP ECC6. The ERP was successfully launched on 1st Feb, 2012 with 7 modules catering for all business function of AIL. Agriauto Industries Limited is a Pakistan-based company engaged in the manufacture and sale of components for automotive vehicles, motorcycles and agricultural tractors. Its products include shock absorbers, struts, pipe forks, camshafts, door locks, hood hinges, steering boxes and sheet metal parts. The Companys subsidiary is Agriauto Stamping Company (Private) Limited, and its associated companies include Makro Habib Pakistan Limited, Thal Limited, Shabbir Tiles & Ceramics Limited, AuVitronics Limited and Dynea Pakistan Limited.

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ISO/TS 16949
The ISO/TS16949 is an ISO technical specification aiming to the development of a quality management system that provides for continual improvement, emphasizing defect prevention and the reduction of variation and waste in the supply chain. It is based on the ISO 9001 and the first edition was published in March 2002 as ISO/TS 16949:2002. It was prepared by the International Automotive Task Force (IATF) and the "Technical Committee" of ISO. It harmonizes the country-specific regulations of Quality-ManagementSystems. About 30 percent of the more than 100 existing automobile manufacturers affiliate the requirements of the norm but especially the large Asian manufacturers have differentiated, own requirements for the quality management systems of their corporate group and their suppliers. TS16949 applies to the design/development, production and, when relevant, installation and servicing of automotive-related products. It is based on ISO 9001. The requirements are intended to be applied throughout the supply chain. For the first time vehicle assembly plants will be encouraged to seek ISO/TS16949 certification. Certification The ISO/TS16949 can be applied throughout the supply chain in the automotive industry. A certification takes place on the basis of the certification rules issued by the IATF International Automotive Task Force. The certificate is valid for the length of three years and must be confirmed annually by an IATF certified auditor (3rd Party Auditor) of an accredited certification body, such as Perry Johnson Registrars [PJR], TV Rheinland, TV NORD, Bureau Veritas, Det Norske Veritas BA, DQS, LRQA (Lloyd's Register Quality Assurance), Quay Audit & Certification, SGS S.A., and UTAC. Thereafter follows the re-certification for another three years with a fresh annual confirmation. A certificate according to ISO/TS 16949 is intended to build up or enforce the confidence of a (potential) customer into the system and process quality of a (potential) supplier. Today, a supplier without a valid certificate has very little chance to serve a Tier 1 supplier and certainly no chance to serve a car manufacturer (OEM) with standard parts. [4] Effects All OEMs (Original Equipment Manufacturer) have declared this technical specification as standard. Whether this will improve the quality of automobiles remains unclear. If the specification meets the promises of its proponents, then we should expect declining number of recalls, with statistical significance, over the next years. Agriauto Industries Limited The first company in Pakistan to achieve TS-16949 Certification.

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Exhibition
A trade fair (trade show, trade exhibition or expo) is an exhibition organized so that companies in a specific industry can showcase and demonstrate their latest products, service, study activities of rivals and examine recent market trends and opportunities. In contrast to consumer fairs, only some trade fairs are open to the public, while others can only be attended by company representatives (members of the trade, e.g. professionals) and members of the press, therefore trade shows are classified as either "Public" or "Trade Only". A few fairs are hybrids of the two; one example is the Frankfurt Book Fair, which is trade-only for its first three days and open to the general public on its final two days. They are held on a continuing basis in virtually all markets and normally attract companies from around the globe. For example, in the U.S. there are currently over 2500 trade shows held every year, and several online directories have been established to help organizers, attendees, and marketers identify appropriate events. Given the wide range of places where these display stands are used, and the many years they have been successfully used to promote business and products, it makes sense that there are lots of different sizes, styles, and construction methods used to create them. These different exhibition stands can be categorized or grouped in different ways. One common discriminator is the required size of the trade show display; this can range from the smallest unit a tabletop display, where the exhibitor literally has a table that they stand behind, to exhibition displays that take up hundreds of square feet of booth space. For the biggest shows and product types, such as automobiles, trucks, and airplanes, one can easily imagine that the space required for actually demonstrating a product is enormous! Objectives: 1. Introduce the latest developments of auto parts to manufacturers and suppliers. 2. Connect Suppliers with clients from all around the world to enhance the business. 3. Achieve the maximum sales deals, leads and contacts between the suppliers, local and worldwide. 4. Emphasize on the auto parts, for the purpose of promoting its export worldwide. 5. Demonstrate the development of the auto parts industries in Pakistan, and how the quality of our products meets and exceeds international standards, while the international buyer would enjoy the benefit of low prices. 6. Provide the opportunity for promoting newly launched products, equipment and technologies through workshop sessions, held particularly for that purpose, with emphasis on the international companies.

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What can you expect to find at Expo?

National Pavilions from countries all over the world showcasing numerous new potential suppliers High-performance plastic compounds and resins; Sheet-metal stamping, aluminum pressure die-casting and machining, cold-formed fasteners, precision-turned parts Springs and seals Shock absorbers & Struts Cable assemblies and wiring harnesses Rubber products Powder metal, punched metal parts, stainless steels, nickel and cobalt alloys Electromagnetic components Bolts, nuts, rivets, precision screws and washers Auto A/C system parts Relays and switches Windshield washer systems

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Agriauto Industries Participation in Exhibitions

Agriauto Industries fully participate in auto parts Exhibitions. In Pakistan exhibition arranged by PAAPAM (Pakistan Association of Automotive Parts Accessories Manufacturers). Agriauto invites, Dealers/Retailers Corporate customers/Mechanics

Pakistan Auto Show Exhibition, October 24-26, 2011

Pakistan Auto Show Exhibition, October 24-26, 2011

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Pakistan Auto Show Exhibition, January 11-13, 2013

Pakistan Auto Show Exhibition, January 11-13, 2013

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Observation
Agriauto Industries Limited notified the Stock Exchange on 9th January, 2012 that the company intends to invest PkR 1.05 bn for establishing its fully owned subsidiary (100%) in the name of Agriauto Stamping Company (Pvt) Limited. The establishment of a stamping company would enable Agriauto Industries to diversify its business into the auto industry and would enable it to earn income apart from its core business operations. The company operates mostly on cash generated through its business operations and has negligible debt in its books. Agriauto
Industries itself produces parts and components of automotive vehicles, motorcycles and agricultural tractors whereas its major clients includes Indus Motors, Pak Suzuki Motors, Hino Pak Motors, Sind Engineering, Dewan Farooq Motors Ltd, Adam Motors, Millat & Al-Ghazi Tractors Ltd and Dawood Yamaha.

Conclusion
The company is faced with a great cost increase problem due to the continuous rise in input raw material especially steel prices, rubber and petroleum products. However the industry is financially strong and has achieved major competitive advantages in a growing and stable Industry.

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Reference
Bibliography:-

Principles of Marketing - Philip Kotler, Gary Armstrong, Ehsan ul Haq Marketing Management - Philip Kotler, Kevin Lane Keller, Abraham Koshy International Marketing Philip R. Cateora, John L.Graham Research Methods Uma Sekaran

Web Help:www.google.com www.agriauto.com.pk www.hoh.net www.scribd.com

www.paapam.com www.pama.org.pk

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