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Definition

INDUSTRY

or economy viewed collectively, or one of these individually. A single industry is often named

after its principal product; for example, the auto industry. For statistical purposes, industries are categorized generally according a uniform classification code such as Standard Industrial Classification (SIC).

as the tourist industry or the entertainment industry.

  • 3. Combination of different related firms.

Classification of Industry

Industries can be classified in a variety of ways. At the top level, industry is often classified into sectors: Primary or extractive, secondary or manufacturing, and tertiary or services. Some authors add quaternary (knowledge) or even quinary (culture and research) sectors. Over time, the fraction of a society's industry within each sector changes.

Sector

Primary

Secondary

Tertiary

Definition

This involves the extraction of resources directly from the Earth, this includes farming, mining and logging. They do not process the products at all. They send it off to factories to make a profit.

This group is involved in the processing products from primary industries. This includes all factoriesthose that refine metals, produce furniture, or pack farm products such as meat.

This group is involved in the provision of services. They include teachers, managers and other service providers.

Quaternary This group is involved in the research of science and technology. They include scientists.

Quinary

Some consider there to be a branch of the quaternary sector called the quinary sector, which includes the highest levels of decision making in a society or

Sector

economy. This sector would include the top executives or officials in such fields as government, science, universities, nonprofit, healthcare, culture, and the media.

Top Industries in Pakistan

There are following major industries in Pakistan

  • Textile industry

  • Vegetable ghee and cooking oil industry

  • Sugar industry

  • Fertilizer industry

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  • Cement industry

  • Chemical industry

  • Jute industry

  • Ship building industry

  • Woolen and worsted textile industry

Textile Industry

It is the largest company of Pakistan. There was only 17 units of textile in Pakistan at the time of share. The production of textile was very low and a large quantity of textile had to be imported to meet the domestic, requirements. Now, Pakistan is a prominent country for the production of textile. The textile industry accounts for 17.3% of value added, 32.2% of industrial employment and 60% of total exports. Various steps have been taken by the Government for the growth of the textile industry e.g. the provision of incentives, freedom to acquire technical assistance from abroad, directly financing institutions and improvements in management and labour efficiency etc.

Vegetable Ghee And Cooking Oil

At the time of independence oil industry was very poor. Now there are 150 vegetable ghee and cooking oil factories in Pakistan. Out of these 26 are in the public sector with an installed capacity of 500 thousand tons of ghee and cooking oil. A large quantity of cooking oil is imported to meet the domestic needs. The decline in the production of vegetable ghee is due to lower scale turnover and operational difficulties & closing down of two units in N.W.F.P.

Sugar Industry

In 1947, there were only 2 sugar factories in Pakistan, but at present there are 77 sugar factories in the industry. Revolutionary steps are required to expand the working capacity of this industry, which must be expanded and facilities should be provided to farmers for the production of better crops.

Fertilizer Industry

There are 10 fertilizer units (6 in the public sector and 4 in the private sector) in the country, having an installed capacity of 42,98,000 N. Tonnes (16,74,000 N. Tonnes in the public sector and 26,24,000 N. Tonnes is the private sector). The low production was caused, by operational difficulties, decline in working hours and power failure/load shedding. A number of concessions are provided for the growth of this industry.

Cement Industry

At present 24 cement factories are operating in the country, out of these 4 factories are in public sector and 20 are in private sector. This industry has been allowed duty free import of plant and machinery.

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Chemical Industry

There are 12 chemical factories in the country producing, soda ash, sulphuric acid, caustic soda, chlorine gas and other chemicals. The contribution of the chemical industry towards GNP is only 3%. This industry is not fulfilling domestic requirements, so a large amount of foreign exchange is spent on the import of different chemicals every year.

Jute Industry

At the time of independence there was not a single jute factory in Pakistan. By the cooperation of PIDC, 32 factories were setup in East Pakistan and one in West Pakistan by the time of separation of East Pakistan in 1971. At present there are 12 Jute mills in the country. Now a large quantity of Raw Jute is imported from China and Bangladesh every year to meet the domestic requirement.

Engineering Goods Industry

The engineering goods and capital goods produced domestically are very helpful for economic development of a country. This industry was given importance in the 3rd five year plan. Now we have 4 heavy engineering industries. There are (1) Heavy Mechanical Complex, Texila (2) Heavy Foundry Project, Taxila (3) Pakistan Machine Tools Factory, Landhi (4) Pakistan Steel Mills, Karachi. All these are in the public sector. There are also a number of light and medium engineering goods industries producing a lot of items.

Ship Building Industry

Ships are constructed at Karachi. A number of small and large ships are made by Karachi yard and Engineering works. This factory was establised by PIDC. Now Pakistan is selling ships and boats abroad. In all the five year plans, this industry is given much importance.

Woolen and Worsted Textile Industry

There are 16 woolen mills in Pakistan. These are located at Karachi, Nowshera, Lawrencepur, Quaidabad and Hamai. This industry is not only meeting the worsted and woolen yam requirements of the country, but it is also exporting a large quantity of worsted cloth and carpets to foreign countries.

Pak-Arab (Fertilizer Industry)

OBJECTIVE

Pakistan is an agricultural county and fertilizer industry is its backbone. There is dire need for Government to provide subsidies to this industry so that Pakistan should be able to upgrade the

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living standards of more than 70% of the inhabitants of Pakistan which re having the agriculture sector as an only source of their survival.

Pakarab fertilizer Limited (PFL) is playing a pivotal role in providing the farmers of Pakistan with the coveted fertilizer needs. PFL was earlier on owned by the National Fertilizer Corporation (NFC) but in the recent past it has been taken over by the Fatima Group of Industries. Now as it has been privatized, one can hope that it will meet the appropriate standards and produce quality products for its customers.

Introduction to Fatima Group

Fatima Group is one of the leading business organizations in Pakistan. The Sponsors have been engaged in industrial and trading business since 1936 and, over the years the market reputation, financial standing and strength of the group has grown enormously.

Presently the Fatima Group is operating other than Pakarab Fertilizers Private Limited; export oriented Sugar Mills, a Textile Division consisting of Weaving Mills with 320 modern looms, 3 Spinning Mills consisting about 200,000 spindles, Cotton ginning unit and two large Trading companies engaged in international trading of cotton, sugar, molasses and other commodities. Total employee base of the Group is over 7000.The Group has recorded tremendous achievements in all fields and trade. The sales turnover has increased sharply as compared to initial years and has acquired a sound segment in global trade.During the last few years Fatima Group has made large and constant investment with regards to quality of their products and their productivity not only in the production facility but also in their administration.

INTRODUCTION

Company Profile

Pakarab Fertilizers Limited was established as a result of protocol concluded and signed on November 15, 1972 by the Government of Pakistan to further strengthen and develop fraternal ties between Islamic Republic of Pakistan and State of Abu Dhabi. A Memorandum of Understanding was concluded between Pakistan Industrial Development Corporation (PIDC) and Abu Dhabi National Oil Company Limited (ADNOC) on March 7, 1973. A participation

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agreement emerged on November 1, 1973 to establish a joint venture for the expansion and modernization of the old Natural Gas Fertilizer Factory (NGFF) at Multan. The Company was incorporated on November 12, 1973. Subsequently, PIDC assigned 52% of its shares to National Fertilizer Corporation (NFC) of Pakistan and ADNOC assigned 48% of its shares to International Petroleum Investment Company, with a paid-up capital of PKR743.061 million.

Under the new management, Pakarab Fertilizers Limited has undergone extensive modernization and new improved processes have been introduced to maximize the output while minimizing the negative impacts on the environment. For this a Clean Development Mechanism (CDM) plant was installed, which is the first project of this kind in Pakistan. Basic aim of this project is the abatement of N2O and NOX emissions from the stack gases of Nitric Acid plant. The reduction of greenhouse effect of these gases shows the new management's commitment towards a cleaner environment.

PRIVATIZATION OF PAKARAB

Pakarab has been privatized under privatization policy of Government of Pakistan. Management of the company has been handed over to Reliance Exports (Pvt) Ltd a joint venture of Fatima Group and Arif Habib Group on July 14, 2005.

ISO-9001:2000 CERTIFICATION Pakarab is ISO-9001:2000 certified by M/s SGS.

PRODUCTS AND THEIR SPECIFICATIONS

Pakarab is a complex fertilizers manufacturing company. It is manufacturing following three fertilizer products:

  • Nitro Phosphate (NP)

  • Calcium Ammonium Nitrate (CAN)

  • Urea

Product specifications are as under:

Nitro Phosphate

Total Nitrogen

22%

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Total P 2 O 2

20%

Moisture

0.5%

Calcium Ammonium Nitrate

Total Nitrogen

26%

Moisture

0.5%

UREA

Total Nitrogen

46%

Moisture

0.5%

POWER GENERATION

The company has its own power plant. It has three generators having capacity of 7.5 MW each.

FUNCTIONAL DIVISIONS

Major Functional departments in the organization are:

  • Marketing Division

  • Human Resource Division

  • Finance Division

  • Production Division

Marketing Division is performing following functions:

  • Marketing Development New markets are explored and existing market position is strengthened.

  • Technical Services Technical services such as conveyance of employees are managed.

  • Distribution In this operation activity relating to distribution of fertilizer is managed.

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  • Sales Efforts are done to estimate and increase sales. Marketing Division is providing technical services to the farmers under the supervision of Dr. Maqbool Akhtar. He has done his PhD from Hawaii (USA) in sugar cane development. Marketing Division has divided its market into nine regions; Multan , Faisalabad, Lahore, Bahawalpur, Sahiwal, Rahim Yar Khan, D.G.Khan, Hyderabad and Sukkur. There are 920 sales point and 2262 Bussiness Associates in these regions.

Major Competitors of the Organization Key Fertilizer Producers in Pakistan

The Present Fertilizers industry is divided into two segments: state-owned Enterprises and Private sector.

The private Sector account for 100 % of total installed capacity for urea production and 99% of phosphatic fertilizers, representing a highly oligopolistic market structure. The main players are

  • Fauji Group

  • Fauji Fertilizer Company,

  • Fauji Fertilizer Bin Qasim Limited

  • Engro Chemical Pakistan Ltd.

Other competitors which operates here but are not the major competitors of Pak Arab Fertilizers include:

  • Pak American Fertilizers Pvt. Ltd.

  • Lyallpur Chemicals and fertilizers Ltd.

  • State Owned Enterprises

Operating under national Fertilizer Corporation

  • Hazara Phosphates Pvt. Ltd

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Contribution Towards Society

Pakarab Worker Welfare Board (PWWB)

On October 8, 2010, an agreement was signed between Governing Body of Worker Welfare Fund, Ministry of Labor and Manpower and Pakarab Fertilizers Limited for the construction of Mukhtar A. Sheikh Memorial Welfare Hospital, Multan, at a cost of approximately Rs. 2 billion. Under the agreement, Pakarab Workers Welfare Board is being established as a Public-Private partnership between Worker Welfare Fund (WWF) and Pakarab Fertilizers Limited for the efficient management and administration of the money to be allocated for the Project. For the establishment of the hospital 50% will be contributed by the WWF and the remaining 50% will be contributed by Pakarab Fertilizers Limited. The total project cost of Rs. 2 billion does not include the land cost. Land for the Project is being provided by Pakarab Fertilizers Limited. Once completed, it will be a self sustaining hospital.

Farmer Support & Education

At Pakarab, we know our long-term success is linked to the success of the thousands of farmers who grow crops. That's why we work on-the-ground with farmers and educate them the proper use of fertilizers to help improve yields.

Mission Statement

Enhance farm productivity & profitability by improving farmer's knowledge & perception on

balanced fertilizer use.

Technical Services Team

We have a team of highly qualified and experienced Technical Services Officers, serving the farming community throughout the country. Team is equipped with the latest scientific knowledge, updated time to time, about crop production and fertilizer management practices & balanced fertilizer use to restore soil fertility and enhance farm yields. Technical team uses state of the art methodologies and tools to educate the farming community for improving their knowledge to improve crop yields, farm income and profitability. Team has a close liaison with the Government and private research institute, seed and pesticide companies for day to day updates on new products and technologies being used in the field.

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Seminars

For mass communication of our messages, seminars are organized in each territory. Technical services staff, fertilizers dealers and sales team is involved in this activity. Farmers from within the territory are invited to attend. Seminars are arranged prior to the planting season of each crop. Farmers are appraised on the latest crop management techniques, fertilizer requirements and its application strategies to get maximum benefit & output. Usually 2-3 seminars are arranged in each territory on each major crop.

Problems Faced By the Company

  • Urea made by Pakarab is of more powdered form as compared to the urea made by FFC

  • Obsolete plant with high operating cost

  • Govt. compellations especially for the pricing policy

  • Dependence on imported feed stock suppliers and special repair/maintenance facilities

  • Environmental problem and proximity to urban area

  • Limitation in achieving CAN plant design capacity

  • Limitation in achieving Nitro phosphate product quality, design specifications

  • Too much centralization effects timely decision making

  • Unsatisfactory product quality of urea

  • Improper number and placement of warehouses

  • Company is selling Product which generic names, hence brands do not exist in the market.

  • There are same sale districts without proper market development, therefore appointment of the technical sales officer is required in the under development areas.

  • Marketing dept. has to increase the number of regions with in the organization for better penetration of the market. It has only three Regional Offices.

  • No proper offices exist at sales district levels.

  • Marketing division lacks a full fledge sales & promotion department this task is currently being taken case by a single person

  • Ware houses lack integrated networking systems to the regional offices; hence paper work is done at ware houses.

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Conclusion & Recommendations for Improvement

Though Pakarab Fertilizers (Pvt) Ltd. is the largest complex fertilizer manufacturing plant in Pakistan but still it faces constant competitive threats from its competitors (FFC, Engro Chemicals, PAFL etc). Yet it is moving fatly to gain even larger proportion of market share. The Company is maintaining the tempo of achievements through wholehearted commitment & hard work of its Marketing Division and full support of its dealers / agents and customers.

After the financial and environmental analysis of the company, here are some suggestions and recommendations that could be beneficial for the management. The employees can also improve their efficiency and get incentives by performing their duties in good manners.

  • OVERSTAFFING Pakarab has excessive staff than required. Moreover there is uneven distribution at place where one man can do the job three people are working there. And at some places a job of three persons is done by one man. The uneven distribution results in de - motivation of the employees and gradually his interest in his work decreases that effects the efficiency. In order to Increase the efficiency of worker, job should be assigned to its caliber to develop his interest in work that increase the output and decrease the overall cost of organization.

  • UNNECESSARY DOCUMENTATION In the company there is an unnecessary emphasis on documentation. In transactions lengthy procedure of paper work is involved that decreases the efficiency and results in wastage of time. It is also observed that in some cases the same record is maintained by more than one department.

  • LESS CAREER DEVELOPMENT There are very few programs for career development of the employees. People working in one section or department from years are still with the same knowledge and style of doing job. There should be proper career planning of employee that not only sharpens the skills of the employee &improve the efficiency but also results in better and improved output for the organization.

  • CENTRALIZATION Too much centralization is there in the organization. Managers at low level are not authorized to make decisions even about minor things, they have to consult top management and give justification on small matters. Involvement of top management and reaching at the final decisions is time-consuming and sometimes results in heavy losses. Also man at low level with responsibility and no

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decision making power gradually loses interest in his job and is de-motivated that effects his performance. So there should be delegation of authority up to certain extent that enables manager to take timely decisions at the spot with confidence. When they take decisions they feel themselves more involved and responsible for the job and in turn their efficiency increases.

  • LESS VALUE ADDITION PFL is quantity conscious rather than the quality, while FFC with almost the same plant and machinery is giving the same standards. After viewing the marketing analysis we see that product quality is not up to standard

  • The efficiency of the employees is not up to the mark in some departments, because of the traditional working style of the company.

  • Centralization in decision making should be eliminated for timely decision making.

  • There is a need for more hiring especially in order to expand the marketing network.

  • Product quality, especially of Urea needs to be improved.

  • The management and employees relations should be friendly. Due to this environment the unity and discipline between the management and employees will establish. The efficiency and productivity also increase.

  • Plants should be operated at full capacity to meet the market needs.

  • PFL has to make its position stronger in this growing environment. It should appoint servicing staff apart from sales men on the outlets who can listen to the claims of people. Similarly, the R and D department should conduct research for promotion of its products and for exploring new ways of fascinating customers towards PFL products.

  • Seminars and various functions should be organized to assist farmers for their agricultural problems and to make them familiar with PFL’s products. This could help gaining the confidence of farmers and establishing a goodwill among business associates.

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