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Pak Elektron Limited

Table of contents

CHAPTER #1
Dedication………………………………………………………………………………3
Acknowledgement.....................................................................................4
Executive Summary………………………………………………………………...5
History and Background……………………………...……………………….….6
Vision statement…………………………………………………..……….…………..9
Mission Statements………………………………………………..…………………..9
PEL-LG strategic Partnership…………………………………………………….....10
Company Products………………………………………………………………….12
Company Profile……………………………………………………………………..17
Organizational Structure…………………………………………………………....20
Hierarchy of Marketing Appliances Division……………………………..….….21
Description of Marketing Departments……………………………….……...….22
Description of Different Departments……………………………………………26
SWOT Analysis of PEL………………………………………………………………...35
Strength……………………….……………………………………………….36
Weaknesses………………..….……………………………………………...39
Opportunities………………………………………………………………….42
Threats………………………………………………………………………….43
Problems………………………………………………………………………………..47

CHAPTER #2
Internship Activities…………………………………………………………………..48
Associated Manager and his Style……………………………………………….56
Conflicts and appreciation………………………………………………………..56
Stress and strain………………………………………………………………………56
Compliance of Internship Program and BBIT…………………………………...57

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New Things Learned…………………………………………………………………58

CHAPTER # 3
Overall Summary……………………………………………………………………..59
Recommendations for the Organization………………………………………..61
Recommendations for IBIT………………………………………………………….63
The Institute for Next Internship................................................................64
Special Thanks…………………………………………………………..…………….65

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Dedications

TO My Honorable Teachers Parents and Friends who


showered their wisdom and knowledge enabling me
to come to grips with the worldly life and attain my
Objectives.

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Acknowledgements

We are extremely grateful to Allah for granting us the opportunity, perseverance and
determination for handling the internship at PEL for the July-August 2010 duration. We
extend many thanks to our supervisor Mr. Ghulam Aziz-ud-din who was extremely co-
operative with us and guided us throughout the Internship Program, and Mr.Noor and Mr.
Abdullah for his prowess in Excel and for also taking out time to explain. They helped
me a lot in performing all the activities and in gaining the practical knowledge of
marketing. They monitored my all activities and gave me the best suggestions to
complete all the assigned tasks in an effective manner.

I am so thankful to my institute and my teacher Sir Mansoor Ashiq for giving me the
opportunity of this internship during my course of studies, that build my personality and
enable me to do some creative work be a successful person in practical life.

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Executive Summary

I have worked as intern at PEL (Pak Elektron Limited) for the duration of 6 weeks (22nd
July to 9th august 2010). I made this report about the working of PEL specially consumer
marketing department and appliances division. Whole staff is very co-operative. I have
learnt a lot from this organization which I mentioned in this report.
This report will give its reader knowledge about the history and background of PEL, its
strategic alliance with LG, its products, owners, organizational structure, departments and
their working, its competitors and goals. It also provides SWOT analysis for the over all
analysis in the market. Finally, this report contains my practical learning,
recommendations and suggestions.
The purpose of this exercise was to learn while working in the practical field, especially,
the knowledge related to the Marketing division. It has really helped me observe as to
what extent the text book knowledge is being practiced in real field.

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History and Background

Pak Elektron was setup in 1956 as a Public Limited Company with the object of initially
producing transformers, switchgears, and electric motors. AEG experts and PEL
personnel carried out the designing and production of this equipment jointly.
After the conclusion of joint venture agreement with AEG Saigol Group acquired the
PEL COMPANY in October 1978.

The company floated its shares to the general public and was listed on Karachi Stock
Exchange (KSE) and Lahore Stock Exchange (LSE).
In 1980, Appliances Division was established and in 1981 it started the production of
Window Type Air Conditioners with the technical collaboration of General Corporation
of Japan. These air conditioners were well received in the market for its quality.
Subsequently in 1987 the production of Refrigerators and Deep Freezers was started.
In 1993 the company has started the assembly of Compressors for Refrigerators and Deep
Freezers under technical collaboration with Messrs. NECCHI COMPRESSORI of Italy.
It was in early 70s that PEL became known in overseas markets due to its quality. The
company started its export to countries like Saudi Arabia, Abu Dhabi, Qatar etc. Later on
PEL supplied electrical equipments to various other countries in the Middle East, Far
East and Africa with great success.

PEL (Pak Elektron Limited) is the flag holder 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

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development of the engineering sector in Pakistan by introducing a range of quality home


appliances.
In the year 1980 the company expanded into consumer products with the introduction of
Window Type Air Conditioners and today also manufactures Split Air Conditioners,
Refrigerators, Microwave ovens, Deep Freezers and Compressors etc.

PEL products right from the beginning have been of a high standard and the name PEL is
synonymous with QUALITY all over Pakistan. Since its inception, the company has been
acting as an institution working for the advancement and development of engineering
know how in Pakistan. The company has produced hundreds of engineers, skilled
workers and technicians through its apprenticeship schemes and training programs.
In October 1978, the company was taken over by the SAIGOL GROUP, which is one of
the leading industrial groups in PAKISTAN, having diversified business activities in the
fields of: Textile, Engineering, Banking & Finance, Fuel & Energy, Trading,
Automobiles.

PEL has two divisions of its business.

1. Home Appliances Division


2. Power Division
Home Appliances Division:

Home Appliance Division includes the products like WRAC (Window Room Air
Conditioner), Split Air Conditioner, Refrigerator, Fridge, and Microwave Oven.

Power Division:

Power Division includes the products like Transformers, Switchgear and Energy Meters.

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The present range of power products includes Transformers up to 33KV 5MVA capacity,
Switchgears up to 33KV, Cage Induction Motors up to 40HP, Single Phase Energy
Motors, Small Generators, Shunt Capacitor, Banks and Recloser etc.

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Vision Statement

 To excel in providing engineering goods and services through continuous


improvement.

Mission Statements

 To provide quality products & services to the complete satisfaction of our


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

Slogan
 Change your Life

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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 and vacuum cleaners from June

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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 stakeholders

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Company Products

The company comprises of two divisions:

1. Appliances Division
2. Power Division

1) 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 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 users’ 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

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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.

2. Power Division
PEL Power Division is one of the major electrical equipment suppliers to WAPDA &
KESC. Over the years, PEL electrical equipment has been used in numerous power
projects of national importance within Pakistan. Since 1956 the company manufactures
 Transformers
 Energy meter
 Switchgears
 Kiosks
 Compact Stations
 Shunt capacitor banks

Transformers
PEL’s first major power product being produced since 1956. The company
manufactures Transformers up to 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 sizes are 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.
Besides the standard 11/0.415 KV transformers, PEL also manufactures. 33/11 KV
transformers up to 45000 KVA, pad mounted transformers and Silicon Oil Transformer
etc.

Switch Gears

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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 upto 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 wattmeter
being produced under licensed 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

PEL Chronological Launch Products:

Year Product Introduced Technical Collaboration

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Distribution Transformers,
1956 Switch Gears, & Three AEG West Germany
Phase Induction Motors
PEL was taken over by
1978
Saigol Group
PEL Window Type Air
1981 General Corporation Japan
Conditioner

1987 PEL Refrigerators SILTAL SPA Italy

1987 PEL Deep Freezers ARISTON Italy

PEL NECCHI Fractional NECCHI COMPRESSORI


1993
Horse Power Compressors Italy
PEL Single Phase Watt ABB, Power T&D
1994
Hour Meters Company USA
PEL DAEWOO Color
1995 Daewoo Electronics, Korea
Television
Carrier Window & Split
1997 Carrier Corporation USA
Type Air Conditioners
Samsung Window & Split Samsung Corporation
2001
Type Air Conditioners Korea
PEL Split type AC imported
2003 Galanz & Midea, China
from China.
PEL Washing Machine &
Local assembling in
2004 Floor Standing Air
Washing Machine
Conditioners
PEL Digital Energy Meters
2005 License from ABB of USA
& Split AC Manufacturing

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PEL Generator & Mini


2006 Japanese Technology
Refrigerators
Unilever Deep Freezer
2006 Local Manufacturing
(Walls Ice-Cream)

2007 MWO assembly Kit import from GALANZ.

2008 PEL Water Dispenser Trading Item

2009 LG Titan LG

New Microwave Oven at


2010 PEL
Lowest price
Company Profile

Pak Elektron Limited (PEL) is the flag bearer of the Saigol Group of Companies.
The products manufactured by PEL have always been of high standard and the name
'PEL' is synonymous with QUALITY all over Pakistan. Since its inception, the company
has been working for the advancement and development of engineering know-how in
Pakistan. The company has produced hundreds of engineers, skilled workers, and
technicians through its apprenticeship schemes & training programs.
PEL has been continuously adding new products to its range. As a result, PEL has
registered a significant increase in its sales volume, during the last ten years.
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 programs.

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Board of Directors

Mr. M. Naseem Saigol Chairman / Chief Executive Officer


Mr. M. Azam Saigol  
Mr. M. Murad Saigol  
Mr. Muhammad Zeid Yousaf
 
Saigol
Mr. Haroon Ahmad Khan Managing Director
Mr. Muhammad Rafi Khan  
Ms. Neelofer Hameed NIT Nominee
Mr. Syed Hasan Irtaza NBP Nominee U/S 182 of the Ordinance
Mr. Wajahat A. Baqai NBP Nominee U/S 182 of the Ordinance
Mr. Rizwan Hameed NBP Nominee U/S 182 of the Ordinance
   
Audit Committee  
Mr. Azam Saigol Chairman/Member
Mr. Wajahat A. Baqai Member
Mr. Rizwan Hameed Member
Mr. Haroon Ahmad Khan Member

Company Secretary  
Mr. M. Omar Farooq  
   

 
Chief Financial Officer
Syed Manzar Hasan FCA
   

 
Auditors
M/s Yousaf Adil Saleem & Co. (A member firm of Deloitte Touche Tohmatsu)
Chartered Accountants  
 

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Legal Advisors'  
M/s Hassan & Hassan Advocate

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Organizational Structure

IT

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Hierarchy of Marketing Appliances Division

Description of Marketing Departments

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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:
 Appliance Division.
 Power Division.

Appliance Division
The products marketed and managed in Appliance Division are as follows:
 Refrigerators
 Microwave ovens
 Split and Window Air Conditioners
 Washing Machine
 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. Another task of marketing department is allocation of
advertising budget and to develop promotional plans for retailers, wholesalers and end
consumers within limited financial budget for the whole year.
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 happen because much of PEL’s sale is on credit.

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Marketing department is a blend of following departments:


 Customer Service Department
 Credit Control Department
 Consumer Marketing Department
 Dispatch

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.

Credit Control Department (D&C)


D&C is a 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)


There are three main tasks done by CMD
 Processing
 Debit and Credit
 Recovery

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The main function of this department is the collection of the monthly installments from
customers and develops monthly installment reports and ledger. It also includes the
presentation of monthly cheques, their report as well as preparation of bounced cheques
Sheet.
Cash inflow & Cash Outflow Position is Checked on daily basis. Balance with
different banks is matched with Ledger.

Flow of Activities/Procedure of CMD


The working Procedure of CMD include a number of Steps. These steps are:

 Application Collection
 Covering letter for approval and audit
 Approval and payment
 Entry in software
 Order from generation
 Audit of order forms
 Order form send to dispatch office for delivery
 Filling the application with GSS wise
 Finally send the Delivery Orders to the consumers.

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Description of Different Departments

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.
PEL has a full fledge HR Department known as HR&A or administration department
with the staff strength of 38 employees. The GM is the top executive in the HR
department and there is one manager of HR to facilitate the work of G.M. and 2
personnel and an admin officer.
HR Department’s activities are spread over the whole organization. The following areas
come under direct supervision of HR department at PEL.

 Hiring and right sizing of employees


 Training and development
 Compensation system
 Security and fire fighting
 Gate supervision
 Telephone exchange
 Fair price shops
 Canteen supervision
 Dispensary and health care

As the security in the company like PEL is very much important so there is 24-hour
arrangement of security by three shifts in charges headed by a security officer. He is also
responsible for the fire fighting activities and for the placement and checking of all the
fire fighting equipments. For the purpose of security and for the visitors there are two

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gates under the supervision of a supervisors with two gate assistants who are responsible
for all the in and out transport and movement activities in the organization.
There is a telephone exchange in the organization having a facility of 13 lines. The
organization is providing the basic necessities to the workers e.g. flour, ghee, sugar etc.
from the fair price shop at very controlled price and quality. Because this is part of fringe
benefits these benefits are provided to the employees. There is a fair price supervisor who
is responsible for the purchase and distribution.
PEL is also providing the facility of mess to the workers, officer as well as to the interns.
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 checkups 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.
 Financial deals with the banks, investment firms, leasing companies, modaraba
companies, DFIs and other government agencies through Finance Center.

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 Carry out final auditing of financial records prepared by Accounts department of


Appliances and power division.

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
 Bank payment vouchers
 Journal vouchers for general expenses.
 Income Tax /Sales Tax 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.

Administration (IR & A) Department


Key responsibilities are:
 Maintenance of Attendance
 Maintenance of Stores
 Check the material in & out from the factory
 Maintenance of factory
 Provide assistance to all departments regarding material

Procurement Department
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:
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 Local Procurement
 Foreign Procurement

Local Procurement Department


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.

Foreign Procurement Department


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 Department


The internal audit department is made to keep record and track of each department.
The main responsibilities of this Dept are as follows:
 How things are working in each department?
 Avoiding of illegal use of company resources
 Creating a check and balance procedures for each department.

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 Keeping track for misuse of responsibilities


 Indicating unnecessary usage of Budget allocation

Information Technology Department


IT department’s key responsibilities are as follows:
 Troubleshooting and problems facing in computers
 Installing and deletion of software’s
 Rights protection and issuance
 Developed and maintain internal network.
 Developed and maintain domain of each person.
 Create and enhance internal software’s running currently.
 Hardware and all software issues

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

Accounts Department

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The Accounts Department looks after the financial matters. Accounts department for both
power and appliances division have similar functions as below

 Financial keep of daily, including the income statement and balance sheet.
 Book keeping of daily monetary transactions.
 Production maintenance reports
 Cost data on labor, materials and overheads.
 Remittances and loans
 Expense reimbursement
 Tax statement
 Employees Salary Recording
 Cash payment vouchers for cash transactions recording.
 Purchase vouchers
 Bank payment vouchers
 Journal vouchers for general expenses.
 Income Tax /Sales Tax 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&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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Industry Analysis

There are two major local brands i.e. Dawlance and PEL.

Dawlance
The company started their operations in early 80’s. Currently United Refrigeration
Limited is the leader in the Industry, its annual sales are approximated up to 240,000
refrigerators per annum, and they are also dealing in deep freezers, Microwave ovens,
washing machines, Split air conditioners, Televisions and kitchen appliances.
Like every other brand, they also got into agreements with different financial institutions
to cater the hire purchase customer. Company also got its own network of retail outlets in
Karachi to cater the same.
Company’s R&D made them the most progressive and dynamic brand in the market; they
normally introduce new design after every two – three years. Dawlance offer their
products at competitive rates to their customers. They used to offer very controlled credit
and incentive policy but now they have increased their incentives and relaxed credit
policy, because of improved competition products.

Reasons for Dawlance Growth


Following are the reasons for growth in the market share.
 Quality product
 Strong brand name
 Strong dealership network
 Better product range
 Timely availability
 Heavy advertising

PEL
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PEL got into appliances business in 1983 with window room air conditioners. The
product was a big success and became the leaders in this product. In 1987 PEL added
refrigerators in their product line. The initial product didn’t get a good response from the
market
PEL re-launched refrigerators under the silver bullet brand CRYSTAL in 99. During the
first year of launch 50,000 units were sold against 27,000 units in 97-98. Before the
launch of Crystal, the product was at the decline stage of product life cycle. From ’99
onwards PEL refrigerator sales grew at an average internal growth of 36% per annum and
emerged as the second largest manufacturers in Pakistan market.

Reasons for PEL Growth


Following are the reasons for growth in the market share.
 Improved quality product.
 Restoration of dealer’s confidence in product.
 Introduction of differentiated features i.e. Jumbo Freezers, water dispenser
etc.
 Relatively better retailer margins as compared to core competitor Dawlance.

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Pak Elektron Limited

SWOT Analysis of PEL


SWOT Analysis is a strategic planning method used to evaluate the Strengths,
Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It
involves specifying the objective of the business venture or project and identifying the
internal and external factors that are favorable and unfavorable to achieving that
objective.

In many competitor analyses, marketers build detailed profiles of each competitor in the
market, focusing especially on their relative competitive strengths and weaknesses using
SWOT analysis. Marketing managers will examine each competitor's cost structure,
sources of profits, resources and competencies, competitive positioning and product
differentiation, historical responses to industry developments, and other factors.

Marketing management often finds it necessary to invest in research to collect the data
required to perform accurate marketing analysis. Accordingly, management often
conducts market research (alternately marketing research) to obtain this information.
Marketers employ a variety of techniques to conduct market research, but some of the
more common include:

 Qualitative marketing research, such as focus groups


 Quantitative marketing research, such as statistical surveys
 Experimental techniques such as test markets
 Observational techniques such as ethnographic (on-site) observation
 Marketing managers may also design and oversee various environmental
scanning and competitive intelligence processes to help identify trends
and inform the company's marketing analysis.

SWOT analysis is just one method of categorization and has its own weaknesses. For
example, it may tend to persuade companies to compile lists rather than think about what
is actually important in achieving objectives. It also presents the resulting lists

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uncritically and without clear prioritization so that, for example, weak opportunities may
appear to balance strong threats.

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
 Good product quality and service
 Number 2 in refrigerators in Pakistan
 Firm grip in home appliances
 Strong Management
 Distribution of Authority
 Free customer service

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.

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

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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.

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 reduces the
prices and tries to increase the sales of its refrigerators. PEL is also making efforts for the
quality improvements than its competitor Dawlance.

Firm 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 wave Oven etc that is a strong point for the company. PEL

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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 co-operate 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.

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


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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.

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
 System variations
 Lack of Product range
 Less Utilization of capacity

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.

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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. 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

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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.

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 product range
 Export opportunity

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

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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 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.

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:

 PEL facing tough competition.


 Mostly companies Give High Credit in market and get current market
 High Credit market is big fever for the company
 Slow growth rate in Pakistan
 Instability of government
 Tax department

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PEL Facing Tough 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.

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.

Mostly Companies Give High Credit in Market and Get Current


Market

As there is stiff competition in the home appliance market, it 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.

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.

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Instability of Government (political conditions)

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 threat 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.

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Problems
Most of the business of PEL is on banks finance based that is not a good for future
because they are giving very high mark-up to banks and investment agencies from their
profit.

Lack of Advertisement
PEL does not focus on advertising while its competitors are focusing on this part.

Lack of Job Rotation


HR department is not focusing on job rotation which caused lack of interest of employees
in their jobs.

Lack of Co-ordination
There is lack of co-ordination between the departments. Every department is concerned
with its own matters not with the whole company.

Less Product Range


Competitors are offering the products at a wide range in term of different sizes and colors
while PEL has limited offerings in terms of different sizes and colors.

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Chapter # 2:

Internship Activities done by Intern


Throughout the duration of our Internship, we were assigned the following tasks which I
was supposed to work on:

Week # 1

Activities
 During first week, I observe company culture, rules and regulation, norms and the
working of CMD department. I observe the Head of Department Mr. Ghulam
Aziz-ud-Din and marketing executive Mr. Noor.

 The first main task assigned to me was to match the (GSS) number from the
customer’s files given to me and I had to draw the file of customer who’s GSS
and name match with the list. Then I have to draw that NOC’s and make a copy of
that NOC and send the original NOC to the consumer and keep the photocopy as
record in the file. And then I have to report my HOD about the missing
information in the NOC file.

Learning
I have learned a lot from the observation, as it was my first experience so everything
here was new to me.

 I learnt the way to work in corporate environment where I behave in a much


respected way to the senior and junior staff, in return I get an opportunity to work
there and also get respect in return.

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 I dressed up properly, wearing dress pant and dress shirt as guided by my


supervisor.
 I learnt the way of reporting to seniors, as I submitted report to Mr. Ghulam
Aziz-ud-din. (Sample attached see appendix 1)

 I learnt the way to maintain the level of respect in senior/junior employees in


friendly working environment

 I learnt that NOC’s are Not Objection Certificate, which is issued to the
consumers when their installments are completed. This certificate shows that now
there is no objection and no installments remaining.

 GSS stands for ‘Ghar sanwaro scheme’, which is basically a number assigned to
the customer when he/she order some product through lease. This number is
Unique.

 I learnt the way to collect, arrange and report information according to the
standard format provided by Mr. Ghulam Aziz-ud-Din sir.

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Week #2

Activities
 Task assigned to me was to calls the customers and inform them about the delay
in the delivery of their orders. I called several customers and inform them the
reasons of delaying their orders. As there were some changes taking place in
government policies and taxes, so our finance department took some time to
finalize the price list. So supplies delayed for about 4 to 6 working days.

 Dealings with customer and also giving them information about the lease
agreement, requirements for leasing the product and also help the customers in
filling their application forms.

Learning
 My business communication is improved there. I learnt communication skills first
in my BBIT program in Business Communication subject which is taught to me
by Mr. Tahir
Secondly I should thank to my Supervisor who told me how to talk to customer,
one should have to be polite and reply calmly in every situation, as Customer is
always at top priority. That increases my patience level and taught me
professional behavior.
Then I made a report of customers who are not satisfied with this and I submitted
it to my supervisor which looks like:

DO# Customer Name Address Customer Product


Response Category

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2134 Awais ghaffar 496C, model I want it within 3 Water dispenser


town, Lahore. days otherwise
I’ll cancel my
order

2916 Usman Afzal House#21, Zaid I don’t want, just Slip Air
road, lalpul, cancel my order Conditioner
Lahore.

 I learnt Selling and sales management techniques, which helped me a lot in


accomplishing the task of dealing with the customer and selling them products,
listening their queries and solving them.
Mr.Waqas (marketing executive-PEL) helped me in interacting with the
customers and selling them products on lease.

Week#3

Activities
 I visited many departments for different assignments like accounts and finance
departments for signing of cheques, and also in marketing AD department for
signing the documents and copying then which was given to me by Mr. Noor
(marketing executive-PEL, CMD)
 Again dealing with customers. Helping customers in filling their forms of buying
product on lease.

 I had an interview in HR Department. The reason of their interview is that they


want to hire an employee for the post of Assistant Manager. After reading my CV,

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they call me for interview and conduct my interview. Out of 300 interns, 6 to 8 is
selected for this interview and I was one of them.

Learning:
 Visiting different departments gave me opportunity to interact with different
people of different departments; I still have a very good relation with some of
them. I remained patience all the time even if I had to wait for my work for no
reason. Patience is one of the most important tools for learning. Following the
teachings of Sir Mansoor (selling and sales management) I learnt so much in the
company.

 My communication skills much improved through customer dealing and solving


customer queries.

 Form the very first interview I ever had in my life in the company, I learnt that
interviewer should reply calmly and never get nervous at any situation.

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Week # 4 and 5:

Activities
 I worked in Appliances division of marketing in 4th and 5th week.

 Conducting customer satisfaction survey

 Comparison of prices of PEL’s different products like refrigerators, washing


machines, water dispensers, microwave ovens, and split air conditioners with
same product line of other competing brands. I did the quantitative research to
perform this task.

 I was assigned another task of knowing the advertisement of PEL at different


dealers of PEL who also sale competitor’s brands. I did observational research to
complete this task.

Learning
 From the first task I came to know the practical implementations of Observational
and Quantitative research. Teachings methodologies of Ms. Nazish Rizvi helped
me a lot in doing the research. In this research I visited different dealers which
were not only dealers of PEL products but also its competitors.

 In observational research I observed the sign boards, leaflets, broachers etc of


PEL and its competitors. From this research I came to know the advertising of
PEL is not so good. PEL have to work a lot for their advertisements so build the
brand image more in the minds of consumers as well as dealers to become a
market leader.

Week # 6

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Activities
 Survey of different departments to gain some more practical knowledge and to
know the workings of different departments. I surveyed in detail the following
departments:
 Consumer Services Department (CSD)
 Human Resource Department (HRD)

 I attended complete one day Youth Empowerment Program (YEP) organized by


the company that helped me a lot in CV writing and how to give an interview.

Learning
 From the surveys of different department, I learnt work of different departments.
In Consumer Service Department of PEL, their main task is to provide after sales
services to the customers. Some of the employees of Consumer Service
Department resign from the job because of the too much work load; So PEL
should decrease the workload in order to retain employees in this department.

During one day workshop on Youth Empowerment Program, I learnt:


 To write a CV for each job. We should have to write a customized CV for
each post/jobs. It is bad practice to throw out a same CV in all companies for
different posts. First read the Job specification and job description then make
a CV according to their requirements.

 One very interesting thing and a common mistake even made by the
organizations I have learnt is that I was not an INTERNEE; definition of
internee at Google is “the internees were enemy aliens and suspected terrorist”

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and an Intern is defined as “an intern is someone who works in a temporary


position with an emphasis on the job training rather than merely employment.

 I also learnt that how to prepare for the interview. How to sit in front of
interviewer, how to dress up and how to use gestures properly. How to
counter your week points.

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Associated Manager and his Style


I worked under respected Mr. Ghulam Aziz-ud-din Sir; he was very hard working and
polite person. He guided us during all the period of our internship. I learned real time
marketing by working under him. He assigned us the assignments and we had to report
him at end of the day. He used to encourage us and guided us to improve our work. He
also sent us to the other departments of the PEL in order to know how they operate. In
short, he was a well managed person.

Stress and Strain


Stress and Strains are almost found in all the Departments. Like other Organizations PEL
Marketing Department has also some stress and strain which are mentioned below.
In customer service department, there are a lot of work load on the employees. Marketing
executive has also do the work of marketing manager as well. Employees are not paid
according to their work. Employees have not given the opportunity of job rotation as a
result some of employees has fed up from their same workings.

Conflicts and appreciation:


No such conflicts are found in the PEL in Consumer Marketing Department as well as in
Appliances Division as I worked in both of the departments. No leg pulling and jealousy
is found amongst employees. There is good relationship and bond amongst all the
employees and work is done with harmony.
In terms of appreciation, employees always get appreciation on performing tasks
efficiently and effectively.

Compliance of Internship Program and BBIT


I found that all my knowledge and studies have application somewhere in the execution
of all activities done. We learned how important the SWOT analysis is; in PEL I learnt its
application.

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My knowledge of MS OFFICE came in handy while working here in PEL, as daily


reports were made in excel. My knowledge of Marketing and Advertising helped me
during my internship in PEL as taught in BBIT. We learnt in Business Communication
and in selling and sales management how to interact with our clients/peer
groups/customers which helped me during my stay in PEL and doing surveys. I realize
the importance of research for any organization by seeing its application in PEL. During
my internship I had to make calls to a lot of customers, by using my communication
skills which I learned from BBIT by giving presentations on variety of topics. So I was
well able to handle the questions of the customers. I was well aware of the fact that how
much listening is important, so I listened carefully to my customers. Sometimes I had to
bear wrong attitude and rude behavior from the customers. So I never tried to make them
wrong directly as I had learned the concept of “you point of view” in the business
communication. I really enjoyed the confidence during my internship which I have got by
giving the presentations in almost every course during BBIT so far.
I found it a very valuable opportunity to actually see the application of all my knowledge.

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New Things Learned


Some new things, which I learned here, are:
 The way 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.

 The way to deal with your customer’s complaints in such a way to satisfy them.

 The way to behave in business environment

 Importance of documents

 Importance of shelf spacing of your products in market

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Chapter # 3:

Overall Summary

My over all experience at PEL was very good. I learned lot of new things which I believe
will help me throughout my life. PEL is a recognized organization but still there are some
problems as I mentioned above. If PEL considers these problems and solve them it would
be very easy for them to achieve maximum market share and became the market leader.

Evaluation of Internship Program

I have learnt many things through this internship program. Ranging from how an
organization works and essentials of surviving in a business environment to importance
of proper and updated documentation and also the ways and means of dealing customers
effectively. As well as the pivotal role that coordination among various departments plays
in achieving optimal results. This internship program will produce quality employees in
the future. A Youth empowerment program (YEP) held by HR DEPARTMENT for the
improvement of CV writing and interview skills was very learning experience.

Would you Consider PEL as Future Employer?


Why?
 I can learn many things from PEL like how to work in corporate environment
where I behave in a much respected way to the senior and junior staff, in return I
get an opportunity to work there and also get respect in return. Working
environment of PEL is quiet professional
 The administration of PEL is much supportive.
 PEL has professional culture.
 Much Good Will
 Growing organization

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 To produce equipment to be used in numerous projects of national


importance.
 To produce skilled workers and technicians through its apprenticeship
schemes and training program for all departments
 Provides other Facilities like (Mobile, Fuel & conveyance)

Why Not?
- Too much distance between PEL & my home.
- Unsatisfactory Pay package.
- Strict Rules & regulations

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Recommendations for the Organization

 As I found brand name is very important factor in consumer buying behavior, thus
it is advised that PEL should work on the brand image. Although PEL has a
strong brand name, but it has to create much more stronger one, mainly through
advertising mainly electronic media advertising, to compete with Dawlance,
Waves, and other international brands.

 There should be job rotation to make the more learning culture of PEL, which
keeps the interest of the employees in their work.

 The company should add more features to their products, like different products
in different colors and sizes. People are attracted towards a product with unique
features and something that would make the customers feel that they have got
their moneys worth.

 To gain more competitive advantage over their competitors, PEL has to work on
their distribution network. 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 sales.

 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.

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 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.

 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.

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Recommendations for IBIT

I recommend IBIT the following things:


 IBIT should hire some experienced teachers that give us lectures at the end of the
course that will give us the practical knowledge or with this we come to know the
current market conditions and competitions around.

 IBIT should do something constructive towards building the brand image of the
institute as well as its degree because people still don’t much aware of that
degree.

 IBIT should arrange educational trips, to polish its students.

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The Institute for Next Internship

Considering my experience I will recommend following things:

 I will recommend all my acquaintances to do join PEL for their internship


programs, as they are so friendly and motivate their interns to get a lot of practical
experiences.

 One thing I appreciate about coca PEL; they give a lot of liberty to their interns.

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Special Thanks

I was not alone in making this report many people were directly and in directly involved
in this effort. Where ever I went to get the information related to Pak Elektron Limited, I
got the positive response. In the organization there were many persons who should be
getting words of thanks form my side
I am very grateful to the following persons for helping me to complete my internship
under their guidance and supervision.

 http://www.pel.com.pk/
 Mr. Ghulam Aziz-ud-din (Head if department-CMD)
 Mr. Noor (Marketing Executive-CMD)
 Mr. Abdullah (Marketing executive-CMD)
 Mr. Irfan (Brand manager-PEL)
 Mr. Junaid (Brand Manager-LG)
 Mr. Sheraz Shaukat (Marketing Executive-CSD)
 Mr. Ruhkaam kairinia

Above all I am especially thankful to my GOD who always helped me out in tough times
and helped me in compiling this Report.

Omer Latif

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