PAK SUZUKI MOTORS
Assign By: Syed Nawab Course Instructor
Group Member: Junaid Akhtar Jay Kumar Farhan Khan Mujahid Hussain
0936115 0936113 0936___ 0936123
1
ACKNOWLEDGEMENT First of all, we would like to express our deep gratitude to Almighty Allah, who enabled us to undertake such an important task and to study about Pak Suzuki and
the
Strategies
to
operate
in
Pakistan
Marketing.
We also also wish wish to acknow acknowled ledge ge the valuab valuable le guidan guidance ce provid provided ed by our respected teacher Mr. Syed Nawab. He always motivated and encouraged us in the completion of this report. We are thankful to Mr. Abdul Aziz who is the Production Manager in Pak Suzu Suzuki ki in Head Head Offi Office ce Kara Karach chii and and enti entire re Pak Pak Suzu Suzuki ki Mana Manage geme ment nt.. They They appreciated the efforts of SZABIST. They have provided all the relevant data as well as other information relating to the important independent variables.
2
CHAIRMANS REVIEW In Year 2009 the demand for automobile was sluggish .The industry for cars and light commercial vehicles experienced 29% decline in the sales volume. The industry sold 107,768 units during the year against 151,517 units last year. It’s my pleasure to present review on the performance of the company for the year December 31, 2009 The demand demand has depress depressed ed during during the year year due to cost cost push push inflat inflation ion result resulting ing from from deprec depreciat iation ion of Pak rupee, rupee, limite limited d financ financing ing by banks/ banks/lea leasin sing g companies and general economics recession. First half of the year was the worst. Sales volume during this period has dropped by 53% compared to last period of last year. Second half was some what better than first half year. As it was grew by 33% over the first half year. The market size of motorcycle has marginal improved by 2% over the last year in the organized sector. During the year 593,479 units were sold against 580,604 units last year. During the first half year Demand was 25% lower than same period of last year. However this loss of demand was offset by the increased demand latter half year.
3
EXECUTIVE SUMMARY MARKETING & EXPORTS Suzuki Suzuki produc productt remain remain popula popularr .Despi .Despite te sluggi sluggish sh market market demand demand for automobile, Pak Suzuki remain market leader with 48% market share. The company launched new 1300cc car (SWIFT) in January 2010. This has been well accepted by the customers. Imported used cars do not really pose any threats to Suzuki products. Availability of spare parts at economics prices and reliable after sales service are the strength of Suzuki products. The export of Suzuki Ravi pickup to Bangladesh and exports of sheet metal parts of Suzuki Cultus to Europe going well. During the year Three hundred and sixty units of Suzuki Ravi pick up and parts worth Rs. 120 million and Rs. 22 million respectively were exported. exported.
LOCALIZATION The company continues to pursue localization in order to reduce the cost of product and keep the prices competitive besides saving foreign exchange.
HUMAN RESOURCE Management and employee relations continued to cordial and industrial peace prevail during the year. A new charter of demand was negotiated in a congenial atmosphere and agreement was entered into for the period of ten years. Human Resource development remains one of the key objectives of the company. Company spent Rs. 12.5 million on the foreign and local training of its employees.
ECONOMIC CONTRIBUTION The company has distinctive position in an automobile industry as leading contri contribut butor or to the public public excheq exchequer uer.. The duties duties and tax paid and the foreign foreign exchange saved by company its last six years of operations as follows:
4
160000 140000 120000 100000 80000
exportsales
60000 40000 20000 0 1st Qtr
2006
2007
2008
2009
Duties and taxes paid by the company during the year represent 0.6%of the total tax estimate forecast in the Federal budget for the fiscal year 2009-2010. Company contribution has reduced 1.06% in the last year because of lower sales volume.
SUMMARY CONCLUSION The management is optimistic that economic indicator is improving. How ever it feels that difficult business environment are likely to continue for some time and profitability will remain under pressure.
5
Table of Contents S. NO
I.
Title
Page No
Introduction
01
II.
Corporate Strategy
09
III.
Situation Analysis
10
IV.
SWOT Analysis
19
V.
PEST Analysis
21
Consumer Research and Marketing Mix
23
VII.
Market Analysis
25
VIII.
Business Strategy
28
IX.
BCG matrix with PLC
29
X
Environmental Policy
33
Bibliography
35
VI.
XI
6
Introduction Pak Suz Suzuki uki Motors Motors Ltd Ltd.. is a compan company y assem assembli bling ng and distri distribut buting ing Suzuki Suzuki
Japan's cars in Pakistan. Currently they are one of the most successful motor companies in Pakistan. The firm was founded in 1983 as a joint venture between PAK and Suzuki, formalizing the arrangement by which Awami Auto Ltd. had produced the Suzuki SS80 from 1982. Suzuki originally owned 25% of the stock, and has gradually increased their holding; they now own 73.09%. The company now assembles a wide range of Suzuki vehicles and aims to produce 150,000 vehicles per year. (2005 production was 100,000)
Our Vision To be Excellent All Around .
Our Mission To provide automobile of international quality at competitive price.
These are Mission and Vision Statement of Pak Suzuki, and they always try to improve skills of employees by imparting training and inculcating in them a sense of participation. •
To achieve maximum indigenization and promote the automobile vending industry.
•
To contri contribut butee to Pakis Pakistan tanii societ society y throug through h develo developme pment nt of indust industry ry in general and automobile industry in particular.
7
Statement of Ethics and Business Practices Here are the code of ethics and Business Practice of Pak Suzuki Motors, 1. Pak Pak Suzu Suzuki ki insi insist stss on inte integr grit ity y and and hone honest sty y of its its empl employ oyee eess in doin doing g bus busin ineess. Any Any unfa unfaiir
or corr corrup uptt pract ractic icees to sol solici icit bus busine iness is
fundamentally inconsistent with business codes of company 2. Pak Suzuki Suzuki believe believess in complianc compliancee to regulatory regulatory obliga obligation tion 3. Pak Suzuk uzukii beli believ evees in fre free and fair air bus busines inesss pract ractic icees and ope open compet competiti itive ve market markets. s. Develo Developin ping g any assoc associat iation ion with with compet competito itors rs to distort the pricing and supply of products is contradictory to company’s business code of conduct. 4. Pak Suzuki Suzuki believes believes in transpa transparenc rency y in business business transact transaction ion and they they are to be recorded accurately and fairly in books of accounts in accordance with standard procedure. 5. Pak Suzuki Suzuki expects expects its employ employees ees to act in compan company’ y’ss best best intere interest st while while holding confidential information. Company expects its employees neither to solicit internal information from other nor to disclose company’s data or any other material information to any un- authorized person/body. 6. Pak Suzuki Suzuki believ believes es in indivi individua dual’s l’s respect respectss and growth. growth. Its employ employmen mentt policies do not discriminate on basis of race, religion, gender or any other factor. 7. Pak Suzuki Suzuki does does not belie believe ve in politic political al affilia affiliation. tion.
8
Corporate Strategy Pak Suzuki is built on the idea of a responsible corporate citizenship thereby managing environmental, safety & occupational health matters as an integral part of our our busi busine ness ss.. In fulf fulfil illi ling ng this this resp respon onsi sibi bili lity ty Pak Pak Suzu Suzuki ki adhe adhere ress to the the following principles:
1) We are committe committed d to provide provide top qualit quality y products products to the satisf satisfac actio tion n and requirement of our customers. 2) We conduct conduct our operations operations in compliance compliance with with applicable applicable environme environmental ntal,, occupational health & safety laws and regulations. 3) We recog recogniz nizee the interrel interrelati ations onship hip betwe between en energy energy and the the enviro environme nment, nt, and we promote the efficient use of energy throughout our system. 4) We ensure ensure safe safe disposal disposal of waste waste generat generated ed from our our facility facility 5) We minimize minimize the dischar discharge ge of waste waste materia materials ls into the enviro environme nment nt by utilizing responsible pollution control practices. 6) We will continuo continuously usly seek seek opportuniti opportunities es to improve improve our adherence adherence to these principles.
As it is clearly mentioned in their Vision Statement that to be excellent all around, and they always operate in Environment friendly. And their Product always be the environment friendly.
With the globalization of markets, greater foreign competition, and the reduction of entry barriers, it becomes all the more important to benchmark a company’s financial indicators on a worldwide basis. World stock markets have recently witnes witnessed sed a return return to fundam fundament ental al finan financia ciall analy analysis sis.. Sound Sound manage managemen mentt as opposed to hype will in the long run generate shareholder value.
9
Situation Analysis In order to plan in a better way we have to perform situation analysis analysis General Environment Product Market Customer Market
General Environment As we know most of people in Pakistan associated with middle class families and haven’t got enough enough money to buy a Luxurious car. car. So they purchase economical vehicles such as Suzuki Mehran, Alto and bikes for their convenience. Nowadays our life becomes very fast and every one try to reach their destination as soon as possible and life style of people is continuously changing. Time is the main factor to reach and complete the work so people shift from public Transport to their personal convinence, so every one prefer to have his/her own car. According to environment of Pakistan Pak Suzuki will be most suitable in available vehicles from middle class to upper class.
10
Product Market
Sale Volume and Trend
Growth Rate
Product variety & Prices
Sale Volume
Pakistan's car sales have shown signs of improvement in the early months of 2010, largely thanks to price reductions on the part of carmakers. Car sales of 10,372 units were up by 28% month-on-month (m-o-m) in October and were 8% higher than in October 2008. Although this may appear to be a welcome sign of recovery after a 50% decl declin inee in car car sale saless in FY09 FY09 (end (endin ing g June June 2009 2009), ), the the Paki Pakist stan an Auto Automo moti tive ve Manufacturers Association (PAMA) has partly attributed the growth to a rush by consumers to buy before prices were increased again at the end of October. Severa Severall carmak carmakers ers have have raise raised d prices prices to counte counterr the effect effectss of exchan exchangege-rat ratee fluctuations, which have been adversely affecting margins. Pak Suzuki Motor Company, has once again showed great performance in the automobile sector and has maintained the sales record of the past. It has maintained 48 percent market share of the industry. This has been informed in a recent convention that Pak Suzuki is not only the top manufacturer of car industry but also tops the list in sales of the car industry. As show in the graphs
11
140000 120000 100000 80000 sales volume motor
60000
car
40000 20000 0 2006
2007
2008
2009
140000 120000 100000 80000 Production volume
60000
motor cars
40000 20000 0 20 06
2 00 7
2008
20 09
12
Growth Rate On February 2009 Pak Suzuki has 48% market share. The sales growth covered all car segments, but the global trend for a shift to small cars was bucked as the highest m-o-m growth came in the 1300-1600cc segment, where sales rose by 31%. The 850cc and 1000- 1300cc segments both recorded growth of 25%. For the first four months of FY10 combined (July to October), sales rose 21% to 34,553 units. However, with October's price hikes likely to affect sales in the coming months, BMI is forecasting car sales growth of around 5%. While we expect some correction in the market from a particularly low base in the last financial year, higher prices will drag on the market's potential growth. Indu Induss Moto Motorr took took adva advant ntag agee of grow growth th in the the high higher er engi engine ne capa capaci city ty passenger car segment, with sales of the Toyota Corolla contributing to growth of 25% y-o-y in October and growth of 77% for the first four months of the financial year. This took the company's market share to 42% from 28% in the same period of the previous financial year. Pak Suzuki's market share for the four months fell
13
to 45% as its sales for the period were down 2% y-o-y, despite a 23% increase mo-m in October and 2% y-o-y increase for the month.
Product variety & Prices Following are some varieties of Moped with their and Prices:
SWIFT (1300 cc) Price: Rs. 1,049,000/The European inspired exterior gives Swift a distinctive look. A unique stylish and design that turns a head where you go. The spirited engine makes for exhilarating drive and gives you ultimate freedom where the road takes you. Colors: Pearl Red, Graphite Grey, Solid white,
Indigo, Silky Silver, Aqua Blue, Eminent Blue
LIANA (1300 & 1600 cc) Price: Rs. 1,230,000/-
The Suzuki Liana available in 1300 cc manual 14
transmission and 1600cc automatic transmission takes you out of ordinary and into the realm. Liana is entirely different car, its style, dimension and comfort will inspire you to see everyday as an open door to a new age. Colors: Pearl Red, Graphite Grey, Solid white,
Indigo, Silky Silver, Aqua Blue, Eminent Blue
CULTUS (1000cc) Price: Rs. 897,000/-
Cultus is the blend of space and craft. Its trim body Conceals ample space & flexblity for both passenger and storage. Cultus ensures everyone, exceptional Value and quality. Colors: Pearl Red, Graphite Grey, Solid white,
Indigo, Silky Silver, Aqua Blue, Eminent Blue
ALTO (1000cc) Price: Rs. 662,000/-
Alto has a bright, roomy and comfortable cabin which keeps body relax and strong and lighter body shell resulting in smooth drive due to reduction of unpleasant noise harshness and vibration. Its small turning 15
radius and compact body make parking a breeze. Colors: Olive Green, Pearl Red, Graphite Grey,
Solid white, Indigo, Silky Silver, Aqua Blue, Eminent Blue
MEHRAN Price: Rs. 514,000/-
Unrivalled in its class, Mehran is Pakistan’s largest selling car. More smart features like head turning lamp, matching front grill and a two spoke steering wheel gives it the tidy look. Functional economy, peak performance or unmatched fuel efficiency, Mehran VXR is the leader. Colors: Pearl Red, Graphite Grey, Solid white, Silky Silver, Eminent Blue
APV Price: Rs. 1,775,000/-
APV 1500 cc (Imported) The New APV gives you everything you ever wanted in your vehicle. Spacious interior for comfort, tough engine to carry large loads and plenty of room for passengers to enjoy a comfortable day long ride. Colors: Pearl Red, Graphite Grey, Solid white,
Indigo, Silky Silver, Aqua Blue, Eminent Blue
JIMNY Price: Rs. 1,850,000/-
JIMNY 4X4 JEEP 1300cc (Imported) Steady, sturdy and smart, Suzuki Jimny with new wide tread brings you the ultimate pleasure of a real 4-wheel drive. It has got all the sporting spirit to go along for adventurous free souls. 16
Colors: Solid white, Silky Silver
BOLAN VAN Price: Rs. 609,000/-
The Suzuki Bolan Hi-roof gives you everything you ever wanted in a van. Spacious interior for comfort, tough engine to carry large loads and plenty of room for passengers to enjoy a comfort -able day long ride. Air-conditioned model (dual thrust) has been recently introduced. Colors: Pearl Red, Solid white, Silky Silver
RAVI PICKUP Price: Rs. 489,000/-
RAVI Pick Up 800cc Suzuki Ravi is the veritable cargo vehicle with an amazing capacity for load bearing and durability. Undoubtedly, the unrivalled commercial vehicle in its class, Ravi is the bread winner for millions in Pakistan. This light comm. -ercial vehicle referred to as the mini revolution, replaced the animal-drawn vehicles in Pakistan. Colors: Pearl Red, Solid white, Silky Silver
17
Customer Market: Customer market and customer buying behavior can be categories:
Demographic Factor
Life Style
Usage Pattern and Behavior
Preference of Specific end Benefit
Demographic Factor: Target market of Pak Suzuki according to Age, Gender and Income: Age
20 year to upwards
Gender
Male and Female
Income
starting from Rs.20000
Life Style: AIO can be described as Customer Life style of Pak Suzuki in terms of AIO Activities
Early Professional, Executives, House Hold, and Business Purpose
Interest
Personal Use, Luxury
Opinion
Sensitive, Conscious, Responsible and Social
Usage Pattern and Behavior: Mostly People use such vehicle for their convenience e.g. go for job and for family use, for Business Purpose.
Preference of Specific end Benefit: 18
Customers who use such vehicle are sensitive, conscious and responsible people. They They trie tried d thei theirr leve levell best best to save save time time as much much as poss possib ible le so they they want want something which is quality wise good and also affordable.
SWOT ANALYSIS Strength: 1) Highes Highestt Market Market Share Share 2) Low Low Pric Pricee Vehi Vehicl cles es 3) Resale Resale of of Local Local Assem Assemble bled d Cars Cars 4) Large Distribution Channels
5) Rising Rising per capita income income with changing changing demograph demographic ic distributi distribution on 6) Highly Innovative and deep product line 7) Highly maintained supply chain 8) Well Managed and highly competitive staff 9) Well defined and beurcratic organizational structure 10) Complete understand between Distributors 11) Easy available of spare parts.
Weakness: 1) Scarci Scarcity ty of of raw raw mater material ial 2) Bargai Bargainin ning g power power of suppli supplier er is low low 3) Lack of coordinati coordination on and linkage linkage with Government/ Government/semi semi governme government nt supporting bodies 4) Less Technical Technical Training Training Institute Institute 5) Less distributi distribution on channel channelss in sub urban urban
Opportunities: 19
1) Increa Increasin sing g Dema Demand nd for for Cars Cars 2) Effi Effici cien entt Efi eng engin inee 3) Large Large Marke Markett size size to opera operate te 4) Global spare part market 5) Space saving Small size CNG cylinders
Threats: 1) Local Local Competit Competitors ors like like Toyot Toyota, a, and Honda 2) Foreign Investment and setup production facilities 3) Smuggling of Auto Parts 4) Inflation rate 5) Heavy Taxes 6) Competition from import cars 7) Increase of Fuel Prices
20
PEST Analysis Uncontrollable environment are those external factors which can prohibit us or can create hurdles between us and our business. It is also called pest analyses which are as follow:
Political Environment
Pakistan Pakistan has to face face lots of ups and down since since its independen independence. ce. So many governments have been broken down by military authority and most of the time marsh marsh law applied applied on Pakistan. Pakistan. In this scenario scenario no entrepren entrepreneur eur was willin willing g to invest invest in Pakist Pakistan an except except few. few.
Due to this this market market environ environmen mentt
wasn wasn’t ’t so good good in Paki Pakist stan an.. Anyh Anyhow ow Paki Pakist stan anii gove govern rnme ment nt neve neverr been been trustworthy for any investor.
Legal Environment
As all countries, Pakistan Pakistan also has some some legislation about each sector. But like developing developing countries countries it is hardly being being imposed by authorities authorities.. Only due to corruption corruption governmen governmentt encourage encourage smuggling smuggling and black marketin marketing. g.
When
anyone supported by government or give more commission to Govt. get inside in the market and they have very soft behavior by government for any legal action. Such unethical activities activities destroy all law and legislation legislation.
Economic Environment
Pakistan Pakistan,, an impoveris impoverished hed and underdevel underdeveloped oped country, country, has suffered suffered from decades of internal political disputes and external ongoing conflict with India. 21
However, However, IMF approved approved the government government policies, policies, encourage encouragess by different different foreign assistance and renewed access to global market since 2001. By following these policies government succeed to reverse the situation of economy during last five years.
Socio-Culture Socio-Culture Environment
Paki Pakist stan an has has stro strong ng cult cultur uree back backgr grou ound nd and and it has has been been foll follow ow in some some particular region of Pakistan Pakistan strictly. strictly. But with the passage passage of time it is going going to change. Thoughts of people, people, choices, taste taste and style has has been totally changed. If we talk talk about about the transp transport ortati ation on source source in Pakist Pakistan, an, Peopl Peoplee use buses buses,, pickups etc for journey. They also have their own as as well e.g. cycle, bikes etc etc and lots of people are pedestrian. But now the people who haven’t any source of transportation they also want something for their convenience because they wants to save their time as much much as they can. People want to use such vehicle vehicle which looks beautiful and also affordable.
Technological Environment Environment
Tech Techno nolo logi gica call fact factor or also also very very impo import rtan antt and and we have haven’ n’tt cont contro roll on it. it. Technology Technology is grooming grooming with the passage passage of time. People People also want that the product that they they have is full of technology. technology. We never control control on technology for example you launched the product last year and your sale volume on that time is very high but after sometime due to latest invention a lots of substitute exist in market which affect on your business so you can’t hold on it.
22
Consumer Research and Marketing Mix Consumer Research Perception of people about Suzuki Products: People think the product should have excellent fuel consumption and a
good resale value. Easily availability of spare parts everywhere even in rural areas. The quality of product is made according to Pakistan roads and
infrastructure. Product line extension with the very low difference of price. 3S (Sales, Service and spare Parts) at your door step. Brand Loyalty. People want such vehicle which doesn’t effect on their prestige and also
within the range of them. So after this research we come to know that Suzuki is best choice for the customer. It is safer on the road less fuel consumption and Environment friendly product. Because of these features it is also economical.
Marketing Mix Promotion For Promotion of Pakistan Suzuki automobiles, we will use different media T.V, Radio, Radio, Test Drive, Drive, Sponsor Sponsorshi ship, p, News News paper paper etc. etc.
We will aware aware our target target
audience through above sources.
23
Placement
The distribution channels of Pak Suzuki shown in the following Diagram.
24
Market Analysis Porter’s 5 Force The strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates. Here are the Porter’s 5 forces. 1. Pot Potent ential ial ne new w en entra trant ntss 2. Bar Bargai gainin ning g power power of buy buyers ers 3. Bar Bargai gainin ning g power power of supp supplie liers rs.. 4. Th Threa reatt of sub substi stitu tutes tes.. 5. Industry Competition/rivalry between competitors.
1. Potential new entrants
In Pak Suzuki this can be described as •
In the the New Ent Entra rant nt cate catego gory ry of Por Porte ter' r'ss 5 fo forc rces es,, we can see that it would be tremendously difficult for another car manufacturer to enter into the market.
•
The rat ratee at whic which h the the indus industry try is chan changin ging g does does not all allow ow for new entrants to come into the market very easily, and the cash investment for a new firm to produce massive quantities of cars is in the billions.
2. Bar Bargai gainin ning g powe powerr of buy buyers ers •
Buyers, from the strong competition inside of the market find themselves in a very favorable position.
25
•
Sincee co Sinc comp mpet etit itio ion n is so stron strong g be betw twee een n au auto to maker makerss an and d dealers, consumers will often do research on a vehicle before making a purchase.
•
The high quantity of dealer’s forces prices to be very negotiable and the consumer often knows exactly what the dealer paid for the car.
•
Thus,, co Thus cons nsum umer erss ar aree in an en envi viab able le posit positio ion: n: Th Thee ma mark rket et supply is strong, competition between auto makers and auto sellers is very intense, and there is no set price.
•
Everyt Ever ythi hing ng is negoti negotiab able le.. Fo Forr co comp mpan anie iess like Pak Pak Suzuki Suzuki to continue to compete, the quality of their offerings must be excellent, dealership service must be strong, and they must focus on offering consumers a product with high durability and value.
3. Bargaining power of suppliers.
Pak Suzuki’s suppliers have been known to be some of the most dedicated suppliers in the industry. •
By vi virt rtue ue of th thee Ju Just st-I -Inn-Ti Time me produ producti ction on con concep ceptt pio pionee neered red by Pak Suz Suzuki uki,, the aut auto o indu in dust stry ry it itse self lf ha hass se seen en a ve very ry po posi siti tive ve re rela lati tion onsh ship ip develop between its suppliers and producers. •
Suppliers Suppli ers are exp expect ected ed to mak makee deliveries of parts in small quantities several times a day. •
Pak Suzuki, by reducing its part inventory, has been able to speed up production costs, save sa ve mo mone ney y by no nott le lett ttin ing g pa part rtss si sitt on th thee sh shel elf, f, an and d improve its relationship with parts suppliers, which rely on Pak Suzuki for their revenue. •
4. Threat of substitutes
26
Consum Cons umer er pref prefer eren ence ce is changing (Mini cars are being replaced by compact or midsized cars) •
Setting up integrated manu ma nufa fact ctur urin ing g fa faci cili liti ties es ma may y re requ quir iree hi high gher er ca capi pita tall investments than establishing assembly facilities •
Pakist Paki stan an is al also so li like kely ly to incr in crea easi sing ngly ly se serv rvee as th thee so sour urci cing ng ba basse fo forr gl glob obal al automotive companies, and automotive exports are likely to gain increasing importance over the medium term •
Pak akiist stan an pa passse seng nger er market is moving towards cars of higher capacity. •
car ca r
5. Industry Competition/rivalry between competitors
Industry competition between auto makers is fierce. The typical cons co nsum umer er,, wh when en se sear arch chin ing g for for a pa part rtic icul ular ar vehi vehicl clee is bombarded by choices. •
For example example,, a se searc arch h for ALT ALTO O (P (Prod roduct uct of Suz Suzuki uki)) yields a result of Coure (Daihatsu) with a minimal extra amount. ANNUAL PLANT CAPACITY Competitor Pak Suzuki Motor Co. Ltd. Indus Motor Co. Ltd. Honda Atlas Cars (Pakistan) Ltd. Dewan Farooque Motors Ltd. Ghandhara Nissan Ltd.
Car Quantity
68,000 34,000 30,000 15,000 6,000
27
Business Strategies Business strategies planning are to be conducted in order to know about their various businesses how each business performing. With the help these strategies we come know which business require investment and in the similar manner which require promotional activities. We can use the same promotional activities and with the help of synergy, their different department (R&D, Marketing, Sales etc) can be shared in different business. By utilizing the synergy efficiently we can reduce cost of product. And this strategy will help manager to identify that which SBU is falls in which categories, for that there is an analysis know as BCG Matrix Analysis which gives the detail information to the managers to carry which SBU, and how many resources should a company allocate to which Unit. In Pak Suzuki the main SBUs are 1) Swift 2) Liana 3) Cultus 4) Alto 5) Mehran 6) Ravi 7) Bolan 8) Jimny
28
After analysis from different data we came across the BCG analysis and draw the following conclusion
BCG Matrix
29
Star
High
Question Mark
Jimny Swif t
Bola n Market Growth
Cash Cow Alto
Dog Lian a
Mehran Low
APV Cultus
Ravi
Low Market Share
High
30
Swift
Jimny Bolan Mehran Alto Cultus Ravi
Liana APV
SBUs Analysis Mehran:
Mehran has the highest growth rate in automobile sector in Pakistan. Pak Suzuki always changes the different parts of Mehran either exterior or interior whenever it comes to its maturity level Mehran attracts the people who have a salary package between 20,000 to 30,000 per per mont month. h. The The youn youngs gste ters rs also also pref prefer er the the Mehr Mehran an beca becaus usee of its its size size and and economical price. Small business people also prefer Mehran because of its low maintenance cost. Mehran also attracts people who move from bike to the cars. Liana:
Liana is a luxurious and highest price car of Pak Suzuki. It was made to compete Pak Suzuki biggest competitors like Toyota and Honda. Liana has the 31
same features which are available in Corolla and Civic but still it couldn’t make its market as compare to both these cars. Liana has replaced the Pak Suzuki’s Baleno in 2005-06, since Pak Suzuki tried several ways to establish its position but failed to do so. It was made for a people of high income group but due to high prices in which the market was already giving names like corolla and civic who has their strong brand name and customer loyalty, liana was failed to capture the market.
Swift: Due to failure of Liana Pak Suzuki introduced another 1300cc car in Jan 2009. Swift has all the latest features like power steering, central locking, Auto Transmission and the ABS. All the 1300cc cars in Pakistan have price range of 1300000 to 1400000, while Swift was introduced at 999000 and recently it was increased at 1049000. It has still advantage of price competition as compare to other 1300cc cars in Pakistan.
Ravi:
Ravi is for the people doing small business especially cargo services like home delivery services, TCS and market delivery. All people doing business of these types are loyal customers to Ravi. Although the competitor launched the Shehzore which has captured the some market share of Ravi but although its sell did not decline too much.
32
PRODUCTION & SALE OF SOME VEHICLE FROM 2005-2009 Name Mehran
P S
2005-2006 35,433 35,982
2006-2007 36,988 37,007
2007-2008 36,249 35,526
2008-2009 13,239 13,421
Alto
P S
17,513 16,823
21,546 21,988
18,805 19,097
6,641 6,550
Cultus
P S
16,823 21,390
21,988 29,837
19,097 27,563
6,550 9,198
Bolan
P S
10,429 10,451
15,520 15,566
17,250 17,209
9,639 8,664
Liana
P S
5,370 4,571
5,964 6,067
2,605 2,983
684 851
Ravi
P S
5,418 5,416
10,117 10,098
11,828 11,857
12,643 11,900
Product Expansion Pak Suzuki also deals in motorcycle and also in Marine equipment, and they have a variety of Product line expansion in Motor bikes is also one of the largest customers size to operate and has a high market size to fulfill the needs of the customers. It also operates in the spare parts of the vehicles and Motor bikes. So they are also operate in vertical integrated, and sometimes the company made different venture to fulfill the needs of its customer, such as it has joint venture with General tier for it products. In Marine segment, the Company is manufacturing the Equipments for ships, it is also one of the largest area to operate, so here the Pak Suzuki plays the role of Business ventures and the transaction at this level is B2B Transaction.
33
Environmental Policy As a general manufacturer of automobiles, motorcycles, outboard motors, etc., Suzuki addresses environmental conservation at all stages in its operations from develo dev elopme pment nt to di dispo sposal sal.. In pro produc ductt dev develo elopme pment, nt, we mak makee eve every ry eff effort ort to improve fuel economy, reduce exhaust emissions and noise, and develop clean energy ene rgy veh vehic icles les,, etc etc.. In man manufa ufactu cturin ring, g, we add addres resss iss issues ues su such ch as red reduci ucing ng environmental risk, reducing energy, and promoting the use of alternative energy. In di distr stribu ibutio tion, n, we foc focus us on imp improv roving ing tra transp nsport ortati ation on eff effici icienc ency y and ene energy rgy reduct red uction ion,, pro promot moting ing the three Rs and the use of low emissio emission n tra transp nsport ort.. In marketing, we address issues related to promoting environmental management at our dealers and proper disposal of end-of-life products, etc. In addition to activities related to production, we also promote energy reduction and green purchasing in our offices, provide our employees with environmental education, promote environmental management at our dealers, and provide social action programs in local communities.
Suzuki 2008 Environmental and Social Report (web version)
34
Future Outlook of the Company: In Future company is going to offer a new activity for it’s potential and Targeted customers Suzuki Insurance Arrangement Program
It is a complete peace of mind solution to all your Auto Insurance needs exclus exclusive ively ly availa available ble at Pak Suzuki Suzuki author authorize ized d deale dealersh rships ips.. This This is a Custom Customer er focus focused ed Auto Auto Insura Insurance nce Progra Program m with with the follow following ing distin distinct ct features: a) Best Best prem premiu ium m rat rates es b) Online/In Online/Instant stant policy policy issuanc issuancee (Walk in – Drive out out Insured) Insured) c) Exclusiv Exclusively ely Repairs Repairs at Pak Suzuki Suzuki Authoriz Authorized ed Dealer Dealer workshops workshops only d) Qualit Quality y Repair Repairss Using Using Suzuki Suzuki Genuine Genuine parts with 6 Months Months Warrant Warranty y on parts e) Largest Largest Country Country Wide Dealer Dealer Network Network Support Support f) Call Call Cent Center er faci facili lity ty g) Fastest claim settlement time.
35
Bibliography http://www.paksuzuki.com.pk http://www.google.com http://en.wikipedia.org/wiki/Pak_Suzuki_Motor http://www.globalsuzuki.com News Papers, Business Review magazines
36
