INTERNSHIP REPORT

PAK ELECTRON LIMITED

BBA

UNIVERSITY OF PUNJAB

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 PREFACE

Competition in practical field is growing due to no. of Govt. and private

institutions making students who have their worth. So, situation is getting
challenging for students of Business Education.

To avoid this discrepancy the MBA students it seems compulsory to

visit various business organizations for 6 Weeks practical training. This
training makes them familiar with the practical system of management, which
prevails in various business organizations. So in this connection I had the
opportunity to perform internship at PEL (Pak Elektron Limited), Lahore
Pakistan.

The internship program is to broaden the vision of practical

experiences with theoretical knowledge as it increases one’s capabilities to
handle problems at various stages and ability of decision.

I tried my best to collect the valuable information and its relevant fact.

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 Acknowledgment

I think honestly reflects on who I am, how I got here, what I think I
might do well, and so forth, I discover a debt to others that has shaped my life.
The work of some unknown people makes our lives easier everyday. I believe
it’s appropriate to acknowledge all of these unknown persons; but it also
necessary to acknowledge those people I know have directly shaped my life
and my work.

Firstly, I wish to place on record my indebtedness to my parents for the

continuous support and encouragement I received during my academic
career.

I would like to express my gratitude to those people who personally

help me through out in studying.

Last but not the least; I am very thankful to all the team of corporate
sale of PEL who helped me gaining the practical knowledge of making sale a
well as dealing with customer during my internship program.

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 DEDICATION

Dedicated to my beloved Parents for

having Firm Belief in my abilities, My
Teachers & Marketing Management
Team

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 EXECUTIVE SUMMARY

I have worked as internee at PEL (Pak Elektron Limited) for the duration of
6 weeks (18 June TO 30 July 2019)
PEL (Pak Elektron Limited) is the flag bearer of the Saigol Group of
Companies. Pak Elektron Limited (PEL) is the pioneer manufacturer of
electrical goods in Pakistan. It was established in 1956 in technical
collaboration with M/s AEG of Germany. In October 1978, the Saigol Group of
Companies bought the company. Since its inception, the company has always
been contributing towards the advancement and development of the
engineering sector in Pakistan by introducing a range of quality home use
products.
PEL has two divisions of its business.
1. Home Appliances Division
2. Power Division

Home Appliance Division includes the products like WRAC (Window

Room Air Conditioner), Split Air Conditioner, Refrigerator, Fridge, Television
and Microwave Oven. Power Division includes the products like Transformers,
Switchgear and Energy Meters.
I have learnt many things through this internship program that is how
an organization works, how much important the paper documents are, how to
deal with the customers and how much important is being updated all the area
sales offices with the head office for any new notifications.

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 PEL Profile

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

goods in Pakistan. It was established in 1956 in technical collaboration with
M/s AEG of Germany. In October 1978, the company was taken over by
Saigol Group of Companies. Since its inception, the company has always
been contributing towards the advancement and development of the
engineering sector in Pakistan by introducing a range of quality electrical
equipments and home appliances and by producing hundreds of engineers,
skilled workers and technicians through its apprenticeship schemes and
training programmes.

The company comprises of two divisions:

 Appliances Division
 Power Division

APPLIANCES DIVISION
This Division of PEL consists of appliances manufacturing.

PEL Air Conditioners

PEL window-type air conditioners were introduced in 1981 in technical

collaboration with General Corporation of Japan. Ever since their launch, PEL

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air conditioners have a leading position in the market. PEL air conditioners
cooling performance has been tested and approved by Copeland and ITS
USA. With the shift of user’s preference from window type to split type air
conditioners, PEL has started manufacturing split type air conditioners.

PEL Refrigerators

The manufacturing of refrigerators started in 1986-87 in technical

collaboration with M/s IAR-SILTAL of Italy. Like the air conditioner, PEL's
refrigerators are also in great demand. Today, PEL Crystal has 30% market

share. Its cooling performance is tested and approved by Danfoss, Germany

and its manufacturing facility is ISO 9002 certified by SGS Switzerland.

PEL Deep Freezers

PEL deep freezers were introduced in 1987 in technical collaboration

with M/s Ariston of Italy. Because of durability and high quality, PEL deep
freezers are the preferred choice of companies like Unilever.

POWER DIVISION

PEL Power Division manufactures energy meters, transformers,

switchgears, Kiosks, compact stations, shunt capacitor banks etc. All these
electrical goods are manufactured under strict quality control and in
accordance with international standards.

PEL is one of the major electrical equipment suppliers to Water and Power
Development Authority (WAPDA) and Karachi Electrical Supply Corporation
(KESC), which are the largest power utilities in Pakistan.

Over the years, PEL electrical equipment has been used in numerous
power projects of national importance within Pakistan. PEL has the privilege
of getting its equipment approved and certified by well-reputed international
consultants such as:

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  Preece, Cardew and Rider, England
 Harza Engineering Company, USA
 Snam Progeti, Italy
 Societe Dumezm, France
 Miner & Miner International Inc. USA
 Ensa, France

In spite of stiff competition from emerging local and multinational brands,

PEL Group's appliances and electrical equipments have remained in the

spotlight due to constant innovation. Strategic partnership with multinationals

of repute have enabled the PEL Group to incorporate new technologies into
existing product ranges, thus giving the Pakistani market access to innovative,
affordable and quality products.

Group Profile

In 1948, the Saigols migrated from Calcutta and initiated their business
in Lyallpur (later named to as Faisalabad), the textile city of Pakistan, under
the banner of Kohinoor Industries Limited.

Kohinoor Textile Mills

The Saigols set up the first major textile unit - The Kohinoor Textile Mills
under the umbrella of Kohinoor Industries Limited. The Kohinoor Textile Mill
has state-of-the-art quality control from raw material to finished product
manufacturing. Its laboratory is top rated amongst the best laboratories in
Pakistan for testing of textile raw materials, other inputs and yarn.

 Initial Capacity:25,000 spindles

 Current Capacity: 71,648 spindles

Pak Elektron Limited (PEL)

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 In 1978, the Saigol Group of Companies purchased major shares of
Pak Elektron Limited. At that juncture, the company was only manufacturing
transformers and switchgears. With the Saigols in management, PEL started
expanding its product range by entering into Air Conditioner manufacturing.

The PEL Group comprises two divisions

Appliances Division
Power Division

Appliances Division

PEL’s Appliances Division is the flag carrier of the Saigol Group. This
Division of PEL consists of home appliances manufacturing.

In 1981, PEL window type air conditioners were introduced in technical

collaboration with General Corporation of Japan.

In 1986-87, the company started manufacturing of refrigerators in

technical collaboration with M/s IAR-SILTAL of Italy.

In 1987, PEL deep freezers were also introduced in technical

collaboration with M/s Ariston of Italy.

In 2006, the Company has started manufacturing of split type air

conditioners of various capacities as the customer choice has shifted from

Window type to split type air conditioners. The product has received good
response from the market, which encourages the company to multiply its
production in the coming years.

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 Today, PEL has become a household name. Its products are not only in
great demand in the local market but the Company has also started exporting
its appliances to foreign markets.

Power Division

PEL Power Division is one of the major electrical equipment suppliers to

WAPDA & KESC. Since 1956 the company manufactures transformers,
energy meters, switchgears, kiosks, compact stations and shunt capacitor
banks. PEL also has had the privilege of getting its equipment approved and
certified from well-reputed international consultants such as:

 Preece, Cardew and Rider, England

 Harza Engineering Company, USA

 Snam Progeti, Italy

 Societe Dumezm, France
 Miner & Miner International Inc. USA
 Ensa, France

Pak Elektron Limited alone has a turnover of over 180 million US Dollars.

Saritow Spinning Mills & Azam Textile Mills

In 1987, the Saritow Spinning Mills and Azam Textile Mills were
established under the banner of Saigol Group of Companies. Saritow
Spinning Mills is a spinning unit with 25,440 spindles capacity. Facilitated with
the most modern and efficient Japanese and European machinery, its knitted
yarn is renowned in the Far East and Europe for its fine quality. Azam Textile
Mills is reputed for its carded and combed yarn, which is quite popular for
premier knitting and weaving.

Kohinoor Power Company Limited

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 In 1991, the first power unit commissioned in Pakistan, in the Private
sector, was Kohinoor Power Company Limited. Its present production capacity
is 15 MW.

Kohinoor Energy Limited

1995, another power unit, Kohinoor Energy Limited, was established.

Kohinoor Power Limited is a 120 MW power plant located on the outskirts of
the city of Lahore. This project has an annual turnover of $80 million.

CORPORATE PROFILE

BOARD OF DIRECTORS

 Mr. Azam Saigol

 Mr. Murad Saigol
 Mr. Usman Shahid (Managing Director)
 Mr. Homaeer Waheed
 Mr. Muhammad Rafi Khan
 Mr. Gul Nawaz (NIT Nominee)
 Mr. Masood Karim Sheikh
 Mr. Tajammal H. Bokharee (NBP Nominee U/S 182 of the Ordinance)

 Mr. Wajahat A. Baqai (NBP Nominee U/S 182 of the Ordinance)

 Mr. Naseem Saigol (NBP Nominee U/S 182 of the Ordinance)

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 VISION STATEMENT

To excel in providing engineering goods and services through

continuous improvement.

MISSION STATEMENT

To provide quality products & services to the complete satisfaction of

our customers and maximize returns for all stakeholders through
optimal use of resources

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 To focus on personal development of our employees to meet future
challenges

To promote good governance, corporate values and a safe working

environment with a strong sense of social responsibility

COMPANY’S OBJECTIVES

The Objectives and Missions for which the company is established are
as following:

 The purchase and acquire from Messrs. Malik Brother Limited on

Ferozepur Road in the district of Lahore under the name of Pak
Elektron and all plant, machinery, goodwill and all the subsisting
contracts in respect there of with right, privileges and obligations
relating to the sold properties and with a view there of to

 Enter into the agreement and to carry the same into effect with or
without modifications.

 To carry on the business or business of manufacturing, selling,

installing, maintaining designing and dealing in all kinds of
electrical equipment.

 To carryon any business whether manufacturing or otherwise which

maybe found convenient to undertake in connection with or in
addition to any of these objectives mentioned above.

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  To do all such things that are incidental or conductive for the
attainment of the above objectives or any of them.

 To produce high quality and standard products.

 To secure a high share / quota of WAPDA’s demand for power

products.

 To produce skilled workers and technicians through its

apprenticeship schemes and training programmed for engineers
and technicians.

ORGANIZATIONAL CHART

SPAN OF CONTROL

The organizational hierarchy of Pak Elektron Ltd. has both flat and
tall span of administration. In case of lower level of hierarchy (the worker
and their supervisors) the span is wide but as the level goes up, it
becomes tall.

The managing director who is answerable to the Chairman holds the

top position. General Managers are answerable to the Managing Director
(MD) and are responsible for respective division, Managers are heading some
departments, and Assistant Managers (AM) is leading some by Deputy
Managers (DM) and other. There are senior engineers who are section in
charge Supervisors and foremen report to them.

Executive level

At executive level, three to five engineers report to a manager and

almost some numbers of managers’ report to a General Manager.

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Workers level

At workers level, usually 10 to 30 workers report to a foreman. Three to

seven foremen report to a section in charge.

DIVISION OF LABOUR

In Pak Elektron Limited (PEL), two types of employees hired

1. Permanent Workers
2. Temporary Workers

Temporary workers are employed for about 6 months, and when the
season concludes the temporary workers are laid off. Temporary workers
are employed as helpers and assigned those jobs where skills are not
required.

Workers are divided into different teams based upon their skills and
nature of job. The team is lead by head worker who is responsible for the
work assigned to his team and directs the fellow workers to perform the
assigned task. These teams are masters of their jobs. With in a team,
tasks have been assigned in a sequential order and every individual is
assigned a specific task. This activity not only helps productivity but also
helps the quality standards of the workers as each of them tries to keep
an eye on the other to see that he is performing correctly because if any
thing goes wrong, the blame goes to the whole group.

Number of workers varies in different teams depending upon the

nature of jobs.

DEPARTMENTALIZATION

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 As PEL has a complex organization departmentalization made on
all basis. Divisions are made on product basis and departments and sub-
departments are formed on activity grounds. In sales department regional
sales offices exist to look after the business on geographical basis.
Finance and personnel administration departments are divided to look
after the two divisions separately.
PEL is basically divided into two divisions. This division is based on
product.

Power Division

PEL’s Power Division manufactures Transformers, Switch Gears,

Electric Motors, Energy Meters, Compact Stations, Shunt, and Capacitors
etc. of highest quality and of latest international standards. PEL is one of
the major electrical equipment suppliers to Water And Power
Development Authority (WAPDA) and Karachi Electrical Supply
Corporation (KESC), which are the largest power companies in Pakistan.

Transformers

PEL’s first major power product being produced since 1956 is

Distribution Transformers up to 33KV and 5000KVA capacity. These oil-
immersed transformers are suitable for both indoor and outdoor
installations, being manufactured as per IEC 76, BSS 171 or VDE 0532
standards. Sealed tank designs are available up to 200KVA while all
larger size is conservator type. PEL Transformers have been tested in
KEMA labs Holland, against short circuit withstand in addition to Routine
Type and Impulse Tests in Pakistan.

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Switch Gears

PEL’s second major power product is High Tension and Low Tension
switchgears being produced for indoor and outdoor installations complying
with the latest international specification i.e. IEC, BSS or VDE, PEL’s
switchboards are sheet fabricated totally enclosed, floor mounting vermin and
dust proof. These are supplied with factory fitted relevant components and
copper bus bars internal wiring, terminal blocks etc. in preprinted form. Out
switch gear manufacturing line consists of High Tension Indoor or Outdoor
type switch gear, metal clad, draw out type with vertical or horizontal isolation
can be supplied up to 33 KV voltage during rating and short circuit level of 750
MVA as per customers requirements. These panels can be supplied complete
with triple-pole, minimum oil/bulk oil /SF6 Air Magnetic / Vacuum Circuit
Breakers, Current and Potential Transformers, meters protection relays and
other standard accessories PEL’s 11KV switchgears have been tested for
short circuit withstand if the KEMA International Laboratory.

Energy Meters

PEL’s third power product is the high tech, high quality single-
phase wattcmeters being produced under license from ABB (Asea Brown
Boveri Power T&D Company) of USA. In the range 10-40 amps and rated
240 volts. It is also being planned to expand in other metering areas in
near future. The plant with an annual production capacity of 5,60,000
meters became the first unit of its kind in 1997, to be awarded ISO-9002
certification, in Pakistan.

Special products like 11KV and 33KV Auto Re-closers and 11KV
shunt capacitor banks were also supplied to WAPDA under IDA and
USAID International contracts through open international competition.

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Appliance Division

The Appliances Division was established in 1980–81 when company

introduced its first consumer product i.e. Window room Air conditioner in
Pakistan. Refrigerators and Deep Freezers followed this in the year 1986-87,
Fractional Horse Power Compressors in 1993 and carrier window and split air
conditioners in 1997 and Samsung window and split air conditioners in 2001.

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PRODUCT PORTFOLIO

PEL Split Air Conditioners

PEL presents Cool life Split AC which is a technologically advanced model

especially designed for Pakistani market. This masterpiece from PEL provides
maximum cooling even at very high temperatures while minimizing electricity
consumption.

Cool Features:
 Free Installation
KitCompressorWarranty
 Auto restart function
 Environment friendly refrigerant R22
 Anti-rust outdoor unit
 Self diagnosis and auto-
protection
 Two-direction air flow (SLR)
 Ingependant dehumidification
 Trapeziform Inner groove tube

 Easy-cleaned panel  Hydrophilic aluminum fin

PEL manufacture following models of split AC’s that are

Premier

Challenger (C4)

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Future (F19)

Dazzler (D21)

Luxury (L5)

LED and LCD

Pak electron limited has step forward in the production of led screens
in the branch of home appliance. The led models vary in different sizes from
the smallest one being 32” inches to 60” inches. Pak electron limited is
producing these led screens with the help of Chinese contractors. The main
assembly of these screens is done in the factory.

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Floor Standing Air Conditioner

PEL presents Cool life Split AC which is a technologically advanced model

especially designed for Pakistani market. This masterpiece from PEL provides
maximum cooling even at very high temperatures while minimizing electricity
consumption.

Cool Features:
 Free Installation
KitCompressorWarranty
 Auto restart function
 Environment friendly refrigerant R22
 Anti-rust outdoor unit
 Self diagnosis and auto-
protection
 Two-direction air flow (SLR)
 Ingependant dehumidification
 Trapeziform Inner groove tube

 Easy-cleaned panel  Hydrophilic aluminum fin

FS 480 - 4 Ton

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 Microwave Ovens
Microwave oven has two different categories.
1. Silverline Ovens
2. Microwave Ovens

Silverline Ovens

PEL the trustful company name in home appliances all over the
country, now introduced all new models of "PEL Silverline" Microwave Ovens.

Now PEL customers can have different models of PEL Microwave

Ovens in which they can enjoy the grilling feature as well. PEL Microwave
Ovens are available in different sizes and inner cavities (steel & painted).

Cook, Bake, Roast or Grill with the all new PEL Microwave. With
cutting edge technology and advanced features..... Cooking was never this
easy!

Cool Features:

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  Smart Intelli-menu - Preset cooking menu's
 360 degree cooking system - Cook-Bake-Roast-Grill
 Enersave features - Energy Savings
 5 years Magnetron Warranty - Peace of Mind
 PMO 1042
 PMO 9036
 PMO 9025
 PMO 8021

Microwave Ovens

PEL the trustful company name in home appliances all over the
country, now introduced all new models of "PEL Silverline" Microwave Ovens.

Now PEL customers can have different models of PEL Microwave

Ovens in which they can enjoy the grilling feature as well. PEL Microwave
Ovens are available in different sizes and inner cavities (steel & painted).

Cook, Bake, Roast or Grill with the all new PEL Microwave. With cutting
edge technology and advanced features ..... cooking was never this easy!

Cool Features:
 Smart Intelli-menu - Preset cooking menu's
 360 degree cooking system - Cook-Bake-Roast-Grill
 Enersave features - Energy Savings
 5 years Magnetron Warranty - Peace of Mind

 PMO 1052
 PMO 36
 PMO 23T
 PMO 23M
 PMO 20T
 PMO 20M

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24
 Washing Machines

PEL manufacture 2 models of Washing Machines that are;

1. PWM 7700-N
2. PWM 0510

PWM 7700-N

The PEL Semi Automatic Luxury Wash - 7700-N equipped with Japanese
technology has a 100% rust proof plastic body with a big multi pilaster. It can
handle heavy loads and has a quick dry spin.

In addition, it supplements a drain switch that quickly drains out all the excess
water. So treat yourself with the Luxury Wash - washes away heavy loads and dries
them up quickly.

Cool Features:
 One year parts & service warranty
 Japanese technology
 Super large multi pulsator
 Quick dry spin
 Drain switch to drain all excess water
 Semi automatic
 Ability to wash extremely heavy loads
 Low noise & easy operations

 100% rust & shock proof unbreakable

plastic body
Magic Clean PWM 7700 N
PWM 0512

The PEL Econo Wash 512 is made from Japanese Technology with 100% rust
and shock proof unbreakable plastic body. It's a top load with a powerful motor that
provides a brighter wash and has a build in energy saver that gives you excellent

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energy efficiency. So save the energy with this Econo Wash - consumes less electricity
as it gives more output.

Cool Features:
 One year parts & service warranty
 Japanese technology
 Super large multi pulsator
 Quick dry spin
 Drain switch to drain all excess water
 Semi automatic
 Ability to wash extremely heavy loads
 Low noise & easy operations

 100% rust & shock proof unbreakable

plastic body

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 Water Dispenser

PEL manufactures 3 models of Water dispenser that are;

1. PLS-681
2. PLS-801
3. PLS-691

Silverline- PLS-681

Water dispensers are a welcome addition to PEL range of home

appliances. Our Silverline and Life-Stream water dispensers make life a little
easier and fridge space a bit more plentiful. While Cold water refreshes your
mood in burning summer, Hot water on demand is great in the office for
packets of soup, instant coffee and tea.

Cool Features:
 Hot & cold water
 Refrigerator
 Separate Freezer
 Compressor Cooling
 Stainless Steel Water
Tanks
 Super Quiet Design
 Energy Saving
 CFC Free

 1 Year Warranty

PLS 681 SL

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Life Stream
 PLS-801
 PLS-691

Water dispensers are a welcome addition to PEL range of home

appliances. Our Silverline and Life-Stream water dispensers make life a little
easier and fridge space a bit more plentiful. While Cold water refreshes your
mood in burning summer, Hot water on demand is great in the office for
packets of soup, instant coffee and tea.

Cool Features:
 Hot & cold water
 Refrigerator
 Separate Freezer
 Compressor Cooling
 Stainless Steel Water Tanks
 Super Quiet Design
 Energy Saving
 CFC Free

 1 Year Warranty

PLS 801

PLS 691

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 Diesel Generator
PEL manufacture two Model of Generator

1. Domestic Generator

Portable 5.2 KVA Diesel Generators

Portable Generators (Stand by)
 Capacity 1.1, 2.5, 3.3 KVA  Wheel Mounted
 Recoil Start  Key/Auto Start
 Wheel Mounted
 Sound Proof Enclosure
 Efficient Working
 16 Liters Fuel Tank
 Automatic Voltage Regulator
 8 Hours Prime Operation

 Over Head Valve of Smooth

 Free Installation for 5.2KVA
Running
Generator

2. Commercial Generator

Perkins UK direct coupled to Leroy Somer-France)

 Built-in AMF
 Skid Mounted Control Panel
 Base Fuel Tank for 8hrs. operation
 Easy Installation
 Sound Proof Canopy (Optional)
 ATS Panel (Optional)
 Self Excited Alternator

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 FUNCTIONS OF SPECIALIZED DEPARTMENTS

MARKETING

Marketing department is main nerve of any organization as far as PEL

is concerned. PEL has two different marketing departments i.e. separate for
the two divisions:

1. Appliance Division.
2. Power Division.

Appliance Division
The products marketed and managed in Appliance Division are as follows:

 Refrigerators
 Microwave ovens
 Split and window Air Conditioners
 Washing Machines
 Water Dispenser

The primary duty of marketing department is to make an overall

marketing plan for each product and also analyze the current market
situations by monitoring the competitors separately and constructing
strategies accordingly.

It includes the development of daily sales report region wise, location

wise and to compare it with the annual sales plan and in case of fluctuation
take corrective actions and make necessary arrangements. Allocation of
advertising budget for the whole year and to develop promotional plans for
retailers, wholesalers, and end consumers within limited financial budget.

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 Beside these activities this department is also responsible for check
and balance of dealers. This department not only motivates the dealers but
also check their activities. It also checks their credit limit because dealers
have awarded different credit limits according to their potential of sales.
Whenever any dealer’s credit crosses its limits they stop the supply and first
they try to motivate dealer to clear his credit then they restart his supply.
These all things happed because much of PEL’s sale is on credit.

Transshipment

Transportation is an important logistic decision, which PEL has to make

while transporting goods from factories to warehouse and then to dealers. For
refrigerators, the best mode of transportation is truck within cities and
between cities. The main reasons for using trucks are speed of transportation
and economy.

The goods are transported from the factories at Hatter and Gadoon
Amazai to warehouses in Lahore and Karachi. To facilitate the transportation
system the country is divided into two zones. The appliances for Punjab and
N.W.F.P. are stored in the warehouse of Lahore while appliances for Sindh
and Baluchistan are stored in Karachi. The country distribution is as follows.

Zones Area Included

Northern Zone Punjab and N.W.F.P.
Southern Zone Sindh and Baluchistan

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The distribution of zones is as follows:

Region Area Included

Karachi Region All Southern zones including Sindh
and Baluchistan
Multan Region RaheemYaar khan to Okara
Gujranwala Region Jehlum and Kharian
Rawalpindi Region Jehlum towards all NWFP
Faisalabad Region Sargodha, Mianwali, Layya
Lahore Region Sheikhpura,Lahore to Okara onwards

PEL makes annual contracts with different transportation companies. The

products are insured so that any damage during the traveling is borne by the
insurance company. The annual contracts are more economical then renting
trucks when required. As dealers usually take PEL appliances on credit so
they have to bear the transportation cost but if the sales are on cash, as in
case of some institutions that contact PEL directly, the transportation cost is
borne by PEL.
To deal with the dealer’s network through out Pakistan, PEL has employed a
large sales force. This sales force is a link between dealers and PEL.

Dealers
There are about 1500 dealers dealing in PEL appliance. The Company has to
look many different aspects of a dealer before deciding to give him the dealer
ship. The different criteria, which a dealer has to fulfill, are:

 The dealer must have a good reputation in the market in which he is

operating.
 Those dealers are preferred who do business on cash basis with the
company. Even if they take credit they must be financially strong
enough to make the payment within one month.

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  The dealer who gives a prominent shelf space to PEL appliance
without much persuasion or do not demand a high price for shelf place
are preferred.
 Location of dealer's shops is another important factor. The place should
be reachable by customers and easily accessible by them such as Abid
Market Lahore.
 The dealers must promote PEL appliances through point of purchase
promotional material provided by PEL at their shops. These materials
should be displayed at prominent places.

At one hand if PEL demand such services from their dealers, they are offered
many incentives for their services too. PEL has offered many sales promotion
schemes to the dealers, which will be discussed in promotion section.

Placement of Order By The Dealer

Every month each dealer is visited by the sales officer appointed in that
area. That sales officer has all the past record of that dealer regarding the
quantity ordered by that dealer, payment made, payment to be made etc. The
sales officer then checks the number of appliances that are still unsold and
are at dealer's shop or store. If there is a need for an order to be placed the
dealer fills a form which describes in detail which appliance is required by the
dealer in what quantity, which color and model etc. The form is stamped by
the sales officer and is sent to accounts department where the invoice of the
order is made. The quantity ordered along with the invoice is sent to the
respective dealer within twenty days.

Marketing department is a blend of following departments:

 Customer Service Department
 Credit Control Department
 Dispatch

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Customer Service Department (CSD)

CSD is a customer service department under the Marketing Head.

Where the after sale service is provided to satisfy customers having problem
in their appliances. PEL is well known for their customer care service.

Distribution & Credit Control Department (D&C)

D&C is a distribution & credit control department under the Marketing

Head. A responsibility of this department is to maintain record for all the credit
transactions.

Dispatch

Dispatch is another department under the Marketing Head. In this

department all the things are maintained which are send out of the factory or
to dealers.

CONSUMER MARKETING DEPARTMENT (CMD)

This department is basically under the marketing department. At the

start this department did not exist in the hierarchy but with the passage of time
and with the success of easy installment scheme, this department came into
being. The reason is that in the start this department’s target market was
Lahore and its workforce had only 8 persons and now after 2 years of its
establishment it has covers major cities of Pakistan and it has workforce of 45
and they are recruiting more to cover these areas fully.

There are many regional offices in major cities for example in Multan,
Shawl, Karachi, Hydria, Faisalabad, Gujranwala, Hattar, Rawalpindi, Sialkot,
Bahawalpur, Sukkur, Sargoda and AJK (Azad Jammu Kashmir) and the head-
office is in the factory that is Consumer Marketing Department.

34
 This scheme is well received so it’s now on expansion. This scheme is
only in big cities. The target market of this scheme is Government employees
or the employees of those companies, which have signed Memorandum of
Understanding (MOU) with the bank who is financing. Why so? It is because
those Govt. offices make sure to the bank that their employee’s salary will go
to their hands after the deduction of installment of the bank and MOU also
make sure that employees who got financing will get salary after deduction of
bank’s installment. Askari Bank Limited is financing the PEL employees and
Soneri Bank and Bank of Punjab to the others employees of Govt. or
company which has been signed MOU with the bank.

HUMAN RESOURCE DEPARTMENT

Human Resource Department is the most important and key

department of every organization. It not only deals with the employees of the
organization but also help in management of the affairs of the company.
HR Department’s activities are spread over the whole organization. The
following areas come under direct supervision of HR department at PEL.

 Hiring and firing of employees

 Training and development

 Compensation system

 Security and fire fighting

 Gate supervision

 Time clerks etc

 Fair price shops

 Canteen supervision

 Dispensary and health care

35
 PEL is also providing the facility of mess to the workers and as well as
officer. Mess is provided at very nominal charges. Mess supervisor is
responsible for the purchases and cooking.

There is not a particular hospital in PEL but there is a dispensary with

two dispensers and one senior dispenser. For the medical check ups and for
any detailed curves the employees are sent to social security hospital

FINANCE DEPARTMENT

Finance Management is the lifeblood of any industry. If this area of

corporate activities is improperly handled, a company may lead
insolvency despite having all the resources and opportunities. Therefore
proper financial management is vital for every business concern and PEL
is not lacking behind over here.

At PEL finance department for both division (Appliance and Power) is

separate but their procedure are same. To control both another departments
called “Finance Center” is established.
Functions of finance are:

 Perform as a workstation and as an integrated circuit amongst all

department of the company.
 Arrange monetary resources / funds at favorable prices and at
proper time.
 Allocate resources / funds throughout the organization.
 Deal with banks, investment firms, modarabas, government
departments of Appliance and power division calculate and keep
employees salaries record.
 Carry out final auditing of financial records prepared by Accounts
department of Appliances and power division.

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Income Tax /Sales Tex Recording

The Finance Center prepares and keeps up to date record of income

tax & Sales Tax deductible at source on the payments made to its buyers i.e.
WAPDA and others, income tax/sales tax deductible on the salaries / wages
or on sales of its employees/dealers and tax payable to the government on
the company’s profit.

Employees Salary Recording

Controlled by Account Officer, this section is responsible for keeping

three types of employee’s salaries record. These records pertain to workers,
staff and officers / managers.

When a person joints the organization he needs to submit a

joining report to HR&A for verification. Only those employees are
eligible for salaries that have salary authorization and appointment letter
issued by HR&A department. Every month HR and A department send
an absentees report to salary controller of Finance Center. This list
contains names of those employees who were on unauthorized leave.
The salary controller deducts required amount of money for
unauthorized leave. No salary is deducted if casual / sick / earned leave
is properly applied for.

The monthly salary record of each employee is entered in the

permanent master file of computer. Necessary changes are made if any
increment is observed in the employee’s salary.

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ADMINSTRATION (IR & A)

Key responsibilities are:

 Maintenance of Attendance
 Maintenance of Stores
 Check the material in & out from the factory
 Provide assistance to all departments regarding material
 Maintenance of factory

PROCUREMENT

PEL has state of the art methods of production and they also outsource the
products and raw material not only from Pakistan but also from Asia, America,
Europe, and Africa.
So for this purpose PEL has two different departments for procurement, which
are:
 Foreign Procurement
 Local Procurement

Local Procurement

Local Procurement department is responsible for all the raw materials

that are required for making various products in the factory. It includes from
nails to large metal sheets. At the start of each financial year they receive a
major plan from the management, which highlights all the raw material
required for each product. Dates and maximum time limit for raw material
requirement is also mention in this major plan.

Now procurement team makes small benchmarks and milestones from

the major raw material required plan in order to ease them for remembering
the required time limit and also reminds finance department to arrange
finance for such purchases.

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Foreign Procurement

Responsibilities and duties are same as Local procurement but they

vary in the dimension that, they have to arrange the raw material from abroad.
They also receive same plan as local procurement for the whole financial year
and develop milestones to carry out the plan execution properly.

The skill of this department is to purchase the raw material in the

optimum cost that best satisfy the need of production department and also to
finance department in quality as well as in monetary terms respectively.

INTERNAL AUDIT

The internal audit department is made to keep record and track of each
department.
The main responsibilities of this Dept are as follows:

 Indicating unnecessary usage of Budget allocation.

 Avoiding of illegal use of company resources.
 Creating a check and balance procedures for each department.
 Keeping track for misuse of responsibilities.
 How things are working in each department?

INFORMATION TECHNOLOGY

IT department’s key responsibilities are as follows:

 Troubleshooting and problems facing in computers.

 Installing and deletion of software’s.
 Right protection and issuance.

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  Hardware and all software issues.
 Developed and maintain domain of each person.
 Create and enhance internal software’s running currently.
 Developed and maintain internal network.

PRODUCTION

Production department’s key responsibility is to develop and create

products that are required for the specific department. They also receive a
major plan for the whole financial year that indicates the number and models
of each brand and the deadline time for each lot. PEL’s production department
is comprised of different units according to the products. Following are the
names of production department:

 Refrigerators Production Department.

 Electricity Meters Production Department.
 Transformers And Switchgears Production Department

ACCOUNTS DEPARTMENT

The Accounts Department looks after the financial matters. Accounts

department for both power and appliances division have similar functions as
below.

Functions

This particular department has the responsibility to prepare and

keep an up to date record of following:

 Financial keep of daily, including the income statement and

balance sheet.
 Book keeping of daily monetary transactions.
 Production maintenance reports

40
  Cost data on labor, materials and overheads.
 Remittances and loans
 Financial deals with the banks, leasing companies, modaraba
companies, DFIs and other government agencies through
Finance Center.
 Tax statement
 Expense reimbursement

The finance department maintains record of all its expenses

through vouchers. Generally the following types of vouchers are used for
this purpose.

 Cash payment vouchers for cash transactions recording.

 Purchase vouchers
 Journal vouchers for general expenses.
 Bank payment vouchers

PEL’s Performance
Gross Sale

During the past three years, PEL has grown from strength to strength
and has established its name as one of the leading brand in the Home
Appliances industry as is evident from its Financial and Market results given
below:

Company’s Capital and Shares

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Share Capital

The capital of the company is Rs. 40,000,000 (Rupees Forty Million)

divided into four million ordinary shares of Rs. 101 – each with power to
increase or decrease the capital, to consolidate or sub divide the shares and
issue shares of higher or lower denomination.

Allotment Of Shares

Only fully paid shares are to be issued. The shares should be under
the control of the directors who may allot or other wise dispose of the same to
such persons, on such terms and conditions and at such time as the directors
may think fit.

Statement of Ethics and Business Practices

The Board has adopted the statement of Ethics and Business

Practices. All employees have been informed of this statement and are
required to observe these rules of conduct in relation to customers, suppliers
and regulations.

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 SWOT Analysis
The strengths, weaknesses, opportunities and threats of PEL are
discussed below:

STRENGTHS

PEL has the following strengths and is in more competitive position in

these areas than its competitors. Following are the main strong points of PEL:

 Strong brand image

 Strong dealer network
 Strong quality, sale and service
 Market leader in WRAC
 Number 2 in refrigerators in Pakistan
 Free customer service
 Strong Management
 Distribution of Authority
 Strong research and development department
 Strong grip in home appliances

Strong Brand Image

PEL has created the strong brand image in the mind of the customers
through higher quality and low price. The customers of the PEL always prefer
to buy the PEL home appliances like WRAC split AC and refrigerators
whenever they wanted to buy. PEL is a popular company in Pakistan and
every one knows about the PEL products and its brand. That’s why PEL
selling of WRAC are very high in the market than the competitors selling.

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Strong Dealer Network

It is also the plus point for the PEL that it has also developed the strong
dealer network in the market. The dealers are always trying to sell the PEL
appliance to the customers because they know there are high margin in the
PEL products. They can get more money after selling the PEL products. The
management of PEL also provides more incentives to their dealers than their
competitors. Dealers are very conscious about the PEL products and always
guide the customer in buying the PEL appliances and tell them the more
qualities of PEL products than others products.

Strong Quality Sale and Service

PEL is also in a strong position that it provides the superior quality to

your customers. It makes sense in the mind of the customers that PEL
products are better in quality than the other companies’ products. PEL also
provides the after sale service to their customers which delight the customers
satisfaction. It is another way to advertise the products because when
customer is highly satisfied then he tells the other ten persons that they
should buy the PEL products. It is the free publicity of PEL products that PEL
Company gains.

Market leader in WRAC (Window Room Air Conditioner)

It is another strong point that PEL is a market leader in WRAC. The

window room air conditioner is more demanded by the customers than its
competitor’s air conditioners because it has more durability in operating
systems and cools the room in few minutes. PEL always strives to provide the
innovative features in WRAC. PEL air conditioner is cheaper and has a higher
quality than others WRAC. That’s why customers always purchase the PEL
window air conditioner.

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Number 2 in Refrigerators in Pakistan

After the Dawlance refrigerators PEL has a second position in

refrigerators market. PEL always continuously strives to pursue the strategies
adopted by the competitors. As a consequence the price war starts among the
companies so each company reduce the prices and try to increase the sales
of its refrigerators. PEL is also making efforts for the quality improvements
than its competitor Dawlance.

Strong Grip in Home Appliance

So PEL is one of the companies, which is having a strong grip in the

home appliance i.e. WRAC, Refrigerators, micro way Owen etc that is a
strong point for the company. PEL is penetrating the market by introducing the
new home appliance like Split Air conditioner and always trying to get the
maximum shares in the home appliance market.

Strong Management

It is another plus point that PEL has a strong management. Its

employees are more competent and fully skill and knowledge. They always
cooperate the top management in achieving the goals that are assigned to
them. Employees are well aware about the company objectives and so they
are committed to the development of company.

Distribution of Authority

Top management of PEL delegates the power to the subordinates for

achieving the marketing objectives in a specified time period. So every
manager has an authority that use in achieving the Goals. He can easily
handle the complaints of customers and try to satisfy them. So it is a strong
point for the PEL because there is decentralization of powers.

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Strong Research and Development Department

PEL has a strong research and development department that is

continuously trying to develop new features for the products. R&D department
spends huge amount of money for the development of product. R&D makes
research for introducing the new product and asks the customers what they
want extra in our products. For this purpose they hire the highly qualified
employees in R&D department. That is another strong position of PEL.

Free Customer Service

PEL provides free customer service for one year to its customers. So
the customers always buy the PEL products due to its free service and it
becomes loyal customer for the PEL. PEL always provides help to their
customers for repairing the WRAC, Refrigerators and other items. PEL always
make efforts to satisfy the customers.

Public Limited Company

Although PEL is owned by the SAIGOL GROUP but its shares can be
purchased and sold in stock exchange market. So every one who is interested
in purchasing the shares of PEL he can purchase. It is also called public
limited company. So people are more interested in buying the PEL products.

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WEAKNESSES

Like other companies PEL has some weaknesses in operating the business. If
PEL overcome on these weaknesses then it can become a market leader in
the home appliance. PEL loose some competitive edge in the following points:
 Financial Problems
 Lack of advertisement
 Less Utilization of capacity
 Lack of Product range
 System variations

Financial Problems

Sometimes PEL faces the financial problems because its stocks are so
much piled up in the stores that create the problem of cash flow because
when the stocks are not sold and the production is in process for 24 hours a
day than the company faces such problems. So company aggressively
researches the sources of cash and stresses the dealers to sell the PEL’s
products to the end consumers. Company sometimes sells their products on
advance bases to the dealers and gives them high margin of profit. That’s why
a company is facing the financial problems and company never pays attention
on the alternative resources that will help in reducing the stocks. That is a
customer demand and due to this it is the main weakness of company.

Lack of Advertisement

It is a second major weakness of PEL that it never makes advertising

on TV. That creates hurdle in selling the products and customers cannot know
the changes, which are made in products by the company time to time.
Company is not in a position that it made advertising of all their products on a
wide range because of its high cash requirement towards the production side.

47
Due to this problem company always make efforts to develop strong
relationships with dealers.

System Variations

It is also the main weakness of PEL that there are rapidly a change in
polices of selling the products. That’s creates problems for the selling team
how to sell the products to the dealers because the top management requires
the urgent amount of money. So selling team sells the products sometimes on
hard cash that will reduce the prices of products that gives the benefits to the
dealers and creates problems for the management.

Lack of Product Range

PEL has introduced more products of consumer items but there are
more needs to develop new consumer items like PEL washing Machines,
Vacuum cleaner and other items. Due to lack of product Range, Company
cannot earn more profit because consumers have high demand of these
products and they say that if company is investing in these products then we
can keep all PEL items and we never need to keep other’s company products.

Less Utilization of Capacity

Due to lack of finance a company cannot utilize all its resources on its
full capacity. It increases the cost of products per unit that decreases the profit
margin of each consumer item. Sometimes company cannot allocate the
resources according to the requirements of production department that’s
becomes the problem for the complete utilization of resources. For the
company it is also the main point of weakness.

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OPPORTUNITIES

For the PEL there are more opportunities for expansion the business. If
PEL realize that opportunities then it will be more fruitful and profitable for the
company. Even if company does not take advantage of these opportunities
then it will loose its competitive position and high profit. Its competitors will
give PEL tough time to pursuing the opportunities that are adopted by them.
Following are the opportunities for the PEL.
 Exploration of market in Pakistan
 Increase in production capacity
 Export opportunity
 Increase in product range

Exploration of Market in Pakistan

PEL has the opportunity to explore the market in all over the Pakistan.
Even though PEL introduce its products in all cities of Pakistan but there are
so many places that have the capacity to absorb the PEL’s products. These
places are tribal areas in NWFP and northern areas of Punjab and NWFP,
central area of SIND. If company introduces their products in these areas then
it can get a large amount of profit and increase its market shares.

Increase in Product Range

It is the main opportunity for the PEL that it can increase its product
range that will be a more profitable for the company. There are more needs to
develop new consumer items like PEL washing Machines, Vacuum cleaner
and other items. Due to lack of product Range, Company cannot earn more
profit because consumers have high demand of these products. If PEL does
not take this opportunity then it will loose high margin of profit and market

49
share. It will reduce the fixed cost and increase the efficiency of the
employees.

Export Opportunity

PEL Company has also the opportunity to export their products in other
international countries like UAE, SAUDI ARABIA, and other Arabic and African
countries. It will not only reduce the dependence on one market but also
increase the market shares and profits. It will also help the company to spread
the fixed cost on all of its production that will reduce the total cost and
company will enjoy the high profit.

Increase in Production Line

Company can also increase its production line at the maximum level
that will increase the efficiency of the employees and also will reduce the total
cost. Sometimes company cannot allocate the resources according to the
requirements of production department that’s becomes the problem for the
complete utilization of resources. Company should look the market conditions
then it will produce their products.

THREATS

PEL Company in such a competitive era has many threats as well.

These threats are for the present situations and future. Company should
make its policies and strategies according to these threats. So following are
the main threats for the PEL:
 Strong competition
 China’s product introduction in the market
 Price war
 Slow growth rate in Pakistan
 Investors
 Tax department

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  World Trade Organization
 Instability of government

Strong Competition

There is very strong competition for the home appliance in the market.
So every company tries to come in the number 1 position for achieving the
maximum shares in the market. Every company adopts different strategies for
selling of the products. It reduces the profit margin of each company and
increase the bargaining power of the buyers who will demand higher quality of
products and lower cost. That is the main threat for the PEL Company.

China’s Product

China’s products are another threat for the Pakistani companies

because these products are cheaper than the Pakistani products. An even
china product not well in quality but it is comparatively in low prices than the
consumer’s home appliance that are manufactured by the indigenous
company. China products stress the indigenous companies to lower the
quality and prices that will not be profitable in the long run.

Price war

As there is stiff competition in the home appliance market that will

cause the price war. So every company reduces the prices of its products to
increase the sales. It will not only reduce the profit margin of the company but
also reduce the quality of products. So price war is the main threats for all the
companies, which are operating in these products.

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Slow Growth Rate in Pakistan

There is also slow growth rate of home appliance in Pakistan that will
increase the stocks of the company. It becomes the burden for the company
that how to sell these stocks. Its main reason is that purchasing power of the
buyer is very low and it has no income to buy the expensive the home

appliance. It is also becoming a main threat for all the companies .

Instability of Government

The rapid changes in governments will become threats for the

companies because every government adopts its own policies for the
industries. So it increases the uncertainty for the investors who want to invest
heavy amount in their new projects. That’s become the major threat for the
companies and decreases the profitability. Due to fear of politically instability
companies will also not invest the heavy amounts.

Tax Department

Tax department is another major threats for the companies that will
restrain the business expansion. There is more complicated tax procedure for
the companies, which are interested to increase the investment in their
businesses. A tax department also asks the company from where it receives
the money and where this money will spend. Due to fear of heavy taxes
companies would not like to invest the heavy amount.

World trade Organization

World trade organization will give the permission in 2005 to each

company of home appliance to export their products after paying less duty or
duty free products. That will increase the pressures for the indigenous
companies to reduce the prices and increase the quality. It will increase the
competition among the foreign companies and indigenous companies. But our

52
companies also run under uncertainty conditions. This will decrease the
morale of indigenous companies.

Investor’s

There are few people who have big investments and they are importing
the Chinese product by their own Brand name. This is a very big threat for the
company and company is trying to create some attraction for the investors to
de-motivate the investors.

PEL-LG STRATEGIC PARTNERSHIP

Pak Elektron Limited, held a press conference (April 21, 2009) to

announce the strategic alliance between Pak Elektron Limited & LG
Electronics. An agreement in this regards was signed at the ceremony by Mr.
Murad Saigol, Director Operations, Pak Elektron Limited & Mr. E. D. Choi,
General Manager, LG electronics, Pakistan Liaison Office. Mr. Saigol
announced this to be the biggest partnership in the history of home
appliances and air conditioners in Pakistan and this strategic alliance will
expand in the times to come. PEL has been appointed the official distributor
for LG Air Conditioners, Refrigerators, Microwave ovens, washing machines

53
and vacuum cleaners from June 2009. The addition of LG for Pak Elektron will
now mean Pak Elektron will have two leading brands, PEL and LG, in both the
categories of home appliances and Air conditioners.

This synergy of brands will bring technologically better products to the

customer at competitive prices. PEL will be offering innovative products made
from cutting edge technology of LG. LG Electronics has 30 R&D centers
globally and spends hundreds of millions of dollars on R&D making it one of
the leading brands in the world. This will be possible as LG has a wealth of
global expertise in terms of designing the right product for the consumer. LG
will also enhance the production capabilities of Pak Elektron through
technology transfer which will translate into more smart and sophisticated
designs, with competitive cost of production.

As the facility is upgraded it will be fully capable for export of LG

products thus improving the foreign exchange earnings for Pakistan. Pak
Elektron will benefit from economies of scale as a result maximizing return to
all stakeholder.

INTERNSHIP ACTIVITIES

I have performed these duties during my internship program (18 of June to

July 30 2019). I have performed these activities at PEL in this duration.

 I did record keeping of different documents in their concerned files.

 I Followed up with Marketing officers by making calls
 I Delivered the orders from the factory
 I visited electronic and home appliance markets for marketing
opportunity.
 I made a presentation on the product prelaunch of the new upcoming
PEL washing machine.
 I performed several small time clerical jobs such as printing and
keeping files in accord.

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 New Things Learned

Some new things, which I learned here, were

 How to work individually as well as in groups under relaxed and
stressful environment.
 Patience is very important in dealings, as anger can lose your
customer
 To increase your sales and stay in competition with top brands it is
necessary to keep your dealers happy by giving them incentives.
 How to coordinate with the other sales areas of PEL via telephone/fax.
 How to deal with your customer’s complaints in such a way to satisfy
them.

RECOMMENDATIONS:

 The company should add more features to their products. People are
attracted towards a product with unique features and something that
would make the customers feel that they have got their moneys worth.
 The Company should take measures to improve the quality of their
products. Thus the company is advised to take steps towards
improving the quality of its products, other wise it will lose a lot of
potential customers to their competitors.
 To gain more competitive advantage over their competitors, PEL has to
work on their distribution network.
 PEL more focus should be on electronic media to get competitive
advantage over the competitors. They have to increase their
advertising expenditures.

55
  The Company must give more incentives to the dealers so that they
remain loyal to the company and promote the products.
 Introduction of seasonal schemes can help to boost up their sales.
 The product line of PEL is not good as compared to others like Haier,
Waves, so it’s very good for the company for more success.
 The company should change the advertising theme and slogan to
attract and for the attention of customers. They should show some
creativity in all promotional activities. So PEL should come with some
catchy Slogan.
 Co-ordination should be developed between departments to
departments. This can be done through setting goals and objectives of
the whole company not only for their different departments.
 They should advertise throughout the year so people should remember
them and will be more brand loyal and new customers will be attracted.
They should use all the medium of advertising to be more successful in
attracting customers.
 PEL should define the company’s mission and vision statement that
can be more helpful for them in future. Every organization however it is
small or large has clear direction where they want to go. Without
direction or knowing the purpose of their existence how an organization
can make progress.

Conclusion

Concluding, I found that the people while purchasing for a certain item
take great interest in the brand name, quality, and features. A very fine
example is that of Haier. Most of the people that I had contacted gave a lot of
preference to Haier. People have a strong faith in this brand name, partly due
to its high quality and features and partly due to the brand image that it has
created during all these years. All the other factors like price, advertisement,
word of mouth, dealers etc. don’t have that much importance during the
buying process. But now PEL is also targeting its customers through
advertising, by coordinating their marketing efforts, take advantage of synergy

56
among various communication tools, and develop more efficient and effective
marketing communication programs.

Even a new technologies and formats create new ways for marketers
to reach consumers, they are affecting the more traditional media Television,
Radio, Magazines and Newspapers are becoming more fragmented and
reading smaller and more selective audience.
PEL is doing some advertising efforts but problem is that there is no creativity
in ads. No doubt PEL is making excellent products, but unfortunately PEL is
not realizing creative advertising is also important part of their Marketing
success.

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