SUPPLY CHAIN

MANAGEMENT
Project Report

GROUP MEMBERS:
Khizar Ahmed Shah (8917)
Faraz Ali Khan (9637)
Abdul Baseer Sheikh (9285)
Syed Abdullah Asim (8198)
Hamza Sohail (9525)

BERJAYA PACK
Address: Ehsanabad Industrial Area Phase 2
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P.S: We visited the company and took these pictures we have requested them for the letter head
of our visit there we will show you the letter head in the class.
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Table of Contents
Abstract:................................................................................3
Introduction:.........................................................................4
Business Model:...................................................................4
Supply Chain Activities:........................................................4
Upstream and Downstream Partners:...................................5
Respective Entities of the Supply Chain:...............................6
Competitive Advantage:........................................................7
Challenges in Supply Chain Operations:..............................7
Recommendations:................................................................8
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Abstract:
For about more than 25 years Berjaya Pack is in the wooden pallet manufacturing business, it has
now become one of the well-known manufacturers for providing wooden pallets thorough out
the country to major companies in Pakistan. Like any other business or company Berjaya Pack
also faced hurdles and obstacle to itself but now it has expanded its work all over the country and
is now dealing with clients from every corner in Pakistan. The main reason behind this success is
customer satisfaction and great work ethic flowing within the company, checking and evaluation
of the raw materials quality, efficient and proactive workforce in the production and the delivery
of the pallets to the clients within the given time make it better than its competitors. The supply
of raw materials comes from both outside and from within the city the raw materials used are
wooden blocks, wooden planks and nails which are put under evaluation for quality checking
and then are sent in to the production phase. In production it is made sure that the pallets are
prepared according to the customer’s specifications and description so that they can avoid
dissatisfaction from the customer. It also made sure that the pallets are fumigated properly so that
they can be safe from termites and other insects. When the pallets are manufactured they are then
stored in the warehouse in towers one over the other in a sandwich like arrangement. Then the
pallets are loaded in the containers and are sent to the clients which usually takes few hours if the
order is from within the city and about two or three days if the order is from any other city and
they also bear the cost of transportation. When the order is from another city there a risk factor
that the competitors might bribe the drivers and damage the pallets, the reason behind this is
because the contracts made the clients is worth a lot of money so everybody wants to take the
lead. Hence, considering all these factors Berjaya Pack is trying its level best to deal with these
kind of situations and is establish customer loyalty and satisfaction with its clients.
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Introduction:
Berjaya Pack is a manufacturer of wooden pallets both custom and non-custom made. It is
basically a Malaysian based company but it has a franchise here in Karachi for more than 25
years which provides wooden pallets all over Pakistan its major clients are Chevron, Engro
Foods, Shell, TCS Pvt Limited, Agility Logistic Pvt Limited, General Tyres, Momentum
Logistics Pvt Limited, People’s Steel Mill Limited. Although wooden pallets are far less
expensive than the alternatives, their general quality, durability, and strength are unaffected. In
reality, wooden pallets offer incredible strength and can easily support heavier and bulkier
goods. As a big supplier of wooden pallets they ensure that the customers get ideal wood packing
solutions according to their needs. Besides this they also offer pallet design, analysis and
consultation as well as pallet repair, pallet recycling, logistics services, packing specialists on-
site, warehousing and heat-treating services to meet overall domestic standards and
requirements.

Business Model:
A good business model must create value for both its customers and itself on a continuous basis.
As a result, even well-established businesses must regularly evaluate, adapt, or reinvent their
business models. The business model of this company consists of generating revenue through
wooden pallets which is the end product that it sells to the clients. The profit ratio is set after
including all taxes manufacturing and transportation costs and then the price of the pallets is
quoted after determining the profit ratio. This also includes sourcing wood at low cost, the wood
should be of top quality, the raw materials for manufacturing pallets are acquired from a reliable
source, and the transportation of the pallets must be promptly and at a reasonable cost.

Supply Chain Activities:

The raw materials for the manufacturing of pallets is acquired which mainly include wooden
blocks and nails, since the wood required for manufacturing is needed in bulk amounts the
company sources wood from multiple suppliers to avoid any kind of delay in the manufacturing.
They also source wood from other cities due to the non-availability or over pricing of the
wooden blocks in Karachi. To meet the deadlines of the orders of pallets they keep extra stock in
their inventory so that if anything goes side ways they are able to fulfill the demand of their
customers.
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The quantity of these wooden blocks is up to 60 tons if sourced from within the city, and about
120 tons if the blocks are sourced from outside the city, the reason for ordering big amounts of
blocks from outside the city are firstly due to the overpricing and unavailability of the blocks in
the city most of the time and secondly the quality of the woods are much better than in the city so
that’s why the company is willing to bear the transportation cost as the price is quite reasonable
of the wooden blocks.

The company uses a pull strategy as it makes the pallets according to the demands and
descriptions given by the customers in Karachi or customers in other cities. The requirements
given by the customer mainly includes the size and thickness of the wood being used and the
design of the pallet after the customer gives his requirement the company tells the customer
about the availability of the requirements in the market stated by the customer, sometimes the
standards of the demand set by the customer are much high so in response of these demands the
company gives some alternate solutions to the customer which are efficient and low costly.

After the pallets are manufactured they are stacked in the warehouse one over another in a
sandwich form in towers. The pallets are then moved according to their deadlines and if the order
is within the city then according to the terms and conditions of the company there will be no
transportations charges for the customer but he will have to pay just for the unloading of the
pallets. For the orders outside Karachi the company hires container service and a deal is made
with the client that a specific number of containers will deliver the pallets and the cost of
transportation will be different on each day.

Upstream and Downstream Partners:

Upstream is a part of supply chain system, process or relationship between a company and its
raw materials. A company like Berjaya Pack which follows make to order strategy there are no
orders one after the other sometimes the reason behind this is that some companies take a lot of
time in the order processing due to checking and evaluating the quality of the sample from top to
lower level management, this could be up to 2 to 3 months and then after processing the order
the company then releases the advance cheque. This is the reason why Berjaya Pack does not
have any upstream partners as they order supply when the client gives them the order
description. In a partnership the company has to make an agreement with the supplier to send a
specific number of supply daily or weekly but in this case Berjaya Pack does not have enough
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space to store extra number of supplies and if they do there will be not enough space to store the
final product in the warehouse. The other main reason is of security raw materials can get stolen
such as planks, nails, wooden blocks or tools. It is quite difficult to protect big amounts of
supplies so that’s why supply on daily or weekly basis in not required.

Same goes for the downstream partnership as the orders are not in repetition there is no need for
partnership to deliver the orders to clients on a daily or weekly basis. Downstream operations are
a part of the supply chain process that starts with basic materials and ends with finished goods
sold to consumers. When the order is complete then the company hire the local drivers every
time and then the order is delivered to the customer. This means they manage their outside work
by themselves.

Respective Entities of the Supply Chain:

In a company like Berjaya Pack there are no various entities in the supply chain, but there are a
few which really matter to the company and they can be considered as the backbone of the
company. On the top of this list is the supply and supply management, it is considered the most
vital aspect of any company and for a company like Berjaya Pack supply is a key factor in
determining the overall success of the company. The quantity and quality of supply have a
significant impact on the production the company can satisfy the clients demand if they have the
right kind of supply at the right time.

Then comes the manufacturing of the pallets which is the most important part after the supply of
raw materials. In the manufacturing it is made sure all the pallets are made under supervision of
the management so that no problem occurs after the final product is made. It is made sure that
the production is made according to the description and modifications of the customers’ orders
this makes a positive impact on the customer’s perspective about the company and thus promotes
customer loyalty.

After the pallets are manufactured then comes the duty to deliver them to their respective
customers with proper security and on time at the day for when the commitment was made for
delivery. Although the company does not charge any money for the delivery of the pallets but the
customer has to pay for the unloading of the pallets. If for some reason the order gets delayed
due to any reason such as a strike, public holiday or a problem at the supplier the company then
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adds extra pallets as a complementary gesture to compensate the delay of the order this also
creates customer satisfaction.

Competitive Advantage:
There are many other pallet manufacturing companies but what Berjaya Pack makes more
appealing to clients is their production according to customer’s modifications and specification
of the order. They make pallets according to the clients order description such as the type of
wood and thickness of the pallets. Most of the clients prefer “kikar” wood due to its durability
and endurance, other Pallet Manufactures may mix other chemical to make it look like the wood
that the customer said but it’s not durable and gets damaged in a short time, and to avoid these
type of situations only uses top quality wood.

Moreover, Berjaya Pack uses long head nails instead of short headed ones which are costly but
they are much better than the short ones. Berjaya Pack tries that its rate are competitive than
others buy using top quality woods and nails they set very reasonable charges for its clients. If
they are charging up to 5-10 percent above the competitors rate than it is due to the endurance
and durability of their pallets. One more thing is regarding fumigation, it is a method of pest
control or eradication of hazardous microorganisms that involves entirely flooding a space with
gaseous insecticides or fumigants in order to smother or poison the pests inside. Many other
companies just put ordinary chemicals to make the pallet look fumigated but they get damaged
by insects when exposed to water and are of no use anymore, so to avoid such problems pallets
are properly fumigated in Berjaya Pack

Challenges in Supply Chain Operations:

The challenges in the supply chain may arise due to natural disasters, it could be due to political
issues and strikes, or due to a pandemic, or it could be on the supplier end. For example if a
strike comes up randomly the supply gets affected which results in delay of the order to the
customer. The supply usually comes from Nawabshah and it takes up to 2 or 3 days for the
supply to reach the company, if the supply does not arrive at the anticipated time the production
of the pallets also gets delayed and the commitment with the clients gets effected.
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Furthermore the orders that are from outside the city, sometimes the competitors might bribe the
transporters on route and try to damage some of the pallets or break the company seal on the
pallets and put their seal. This happens because the tenders given by the clients is of very big
amount so that’s why everybody wants to be the first one in line. To deal with this kind of
problems the company can hire someone who is already present in the city where the order is
being delivered so that he can check in detail for any kind of damage or disturbance with the
pallets. When all the checking is done than its up to the client to do whatever he wants with the
pallets but before the unloading of the pallets it is the responsibility of the company to make sure
the order reaches the client safe and sound.

Profit margins are being squeezed as costs rise across the supply chain network of the company.
These costs arise from a variety of sources, and a lack of awareness and accountability for
lowering them can lead to increased operational costs. Rising price of fuel to transport goods by
road, increasing commodity prices raising the cost of raw materials, and increase in the wages
and salary of the workers may cause some problems in the supply chain operations.

Recommendations:
Berjaya Pack is the best company if you are looking to purchase wooden pallets for your
company. They make their pallets according to their customer’s specifications and modifications
and at a very reasonable price than their competitors. They use top quality wood and nails which
makes their pallets durable, enduring and are able to with stand heavy objects. One more thing is
that there pallets are fumigated, other companies just put chemicals which show that the pallets
are fumigated but they are not. Proper fumigation is done so that pallets are protected from
termites and other insects, so if you are in restaurant business you don’t have to worry about your
raw materials catching insects. Besides these their customized design is also a big factor in
gathering the attention of a new customer, every customer wants that it receives exactly the same
specifications and modifications that he has ordered and Berjaya Pack gives the customer exactly
what it wants.