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tapal makes tea time terrific

A hot cup of tea at 7:30am at the breakfast table just before rushing out for the office and
not forgetting to drop the kids to school; in the afternoon after a stressful morning at
work; while sitting in the garden with friends at 6pm in the evening; at night with family
enjoying precious moments; on a late Sunday morning in bed- Tea is an integral part of
our lives. And Tapal is the favorite tea brand for people in Pakistan. Here is why…
TABLE OF CONTENTS

1. Introduction

2. History/Background

3. Product Information

4. Organizational hierarchy

5. Setup Location

6. SCM Hierarchy

7. Functions

7.1. Planning
7.2. Suppliers
7.3. Production / Manufacturing / Imports & Exports
7.4. Warehouse
7.5. Logistics
7.6. Distribution

8. Support from Departments

8.1. IT
8.2. Marketing
8.3. Sales
8.4. HR
8.5. Finance

9. Recommendations & Conclusion


DISCOVERY OF TEA

In 2727 B.C Chinese Emperor Shen-Nung was boiling drinking water


when a few leaves of a wild tea tree blew into the royal bowl. He
discovered that the leaves imparted a delightful flavor to his water;
and so it became his fLavored drink.

It is probable that tea was first cultivated in China, though it is possible


that people in Thailand and Burma have used it for as long as the
Chinese have. The China tea plant was taken to Japan in about AD 800,
where it was regarded as a medicine for several hundred years, until
green tea was developed to become a popular beverage. Tea was
introduced into England, as a gift from the British East India Company,
in about AD 1660 and to rest to Europe soon thereafter.

By the end of the 19th century, China still supplied the bulk of the
world’s tea. In 1886 it exported 136 million kg, of which 77 million kg
went to Britain; while India produced 40 million kg. But within a few
years India moved ahead of China in world trade. Ceylon (Shri Lanka)
emerged as a tea producer in 1867 and Java (now part of Indonesia) in
1878.

Today traditional tea growing countries of China, India, Indonesia, Sri


Lanka and Japan have been joined by many others in South America
(Argentina, Brazil, Peru, Ecuador) and Africa (Kenya, Uganda, Tanzania,
Malawi, Rwanda, and Mozambique)
INTRODUCTION

TAPAL’s SUCCESS STORY

The journey of Tapal's remarkable success is the combined efforts of


three dynamic generations of the Tapal Family. In 1947, Tapal started
out as a family concern under the personal supervision of its founder,
Adam Ali Tapal.

Against tough competition Adam Ali's unique blend, later named


Family Mixture, became a hot favourite and eventually the largest
selling brand in the unorganized tea market. From this auspicious
beginning, Tapal moved from success to success introducing tea
brands to suit every taste and pocket, sold from its retail outlet in Jodia
Bazar, Karachi. The quality of Tapal teas soon became legendary and
people from all parts of Karachi started lining up at the outlet to
purchase tea. For their convenience, tea distribution was initiated to
retail outlets around the city. The company continued to grow under
the management of the founder's son, Faizullah A. Tapal.

Today Tapal Tea is managed by the founder's grandson, Aftab F. Tapal.


After studying abroad, Aftab Tapal returned to Pakistan to introduce
professional management and unique production ideas to the
business. A well trained tea taster and tea connoisseur himself, Aftab
Tapal introduced new tea concepts and developed a wide range of tea
blends catering specifically to the tastes of people throughout
Pakistan. His progressive outlook resulted in giving further strength to
the foundation of quality laid by his family.

Making a modest beginning over half a century back , today Tapal has
become the largest, 100% Pakistani owned tea company in the
country. It has modern tea blending and packaging factories,
warehouses equipped with state-of-the-art equipment and a team of
highly dynamic professionals headed by Aftab Tapal himself.

Tea Market 100% Branded Tea 50% approx.


Unbranded Tea 50% approx.

Tapal’s market share 25-30%


Unilever’s 35%
Others 30%
FORMULA FOR SUCCESS

Tapal's success has astounded many. However no magic formula lies


behind its growth other than hard work, dedication and of course
unique tea blends. As a result, Tapal has won the hearts of countless
tea drinkers across the country.

Tapal's deep rooted culture and core values differentiate it from its
competitors. It is built on sound principles and practices; not
dominated by a group of individuals. Their greatest assets are its
people; and the consistency of principle and policy give the direction.

TQM & KAIZEN

"Never compromise on quality" has been the motto at Tapal since the
very beginning. This commitment to quality has resulted in a high level
of customer satisfaction and unflinching brand loyalty. In December
1997, Tapal Tea became the first Pakistani Tea Company to earn the
ISO-9001 certification: a symbol of the highest international quality
standards. Again in December 2000, Tapal acquired the ISO9001: 2000
certification, making it one of the first few companies in the world to
achieve this milestone. In addition to the standard requirements, the
ISO9001: 2000 certification system includes requirements for
environment improvement, concepts of TQM (continuous
improvement) with major emphasis on consumer requirements and
satisfaction.

QUALITY POLICY

The Management and the employees of Tapal Tea (Pvt.) Ltd. are
committed:

• To produce products that meet the customer's requirements &


expectations.
• To fulfill the requirements and effectiveness of the quality
management system through continual improvements.
• By constantly reviewing / updating the relevant quality objectives of
products & processes.
• To participate as teams or individually towards the improvement of
processes, personnel, environment & ethical values.

LEADERS IN INNOVATION

Always on the move, Tapal Tea is honored to have taken the lead in a
number of areas in the tea industry. Tapal has been:

• The first to introduce soft packs in the country.


• The first tea company to introduce metal-free tea bags.
• The first to develop an entirely new blend and category-Tapal
Family Mixture (the mixture of leaf & dust).
• The first to invent the highly successful brand Danedar Leaf
Blend.
• The first to market Kenya teas in Pakistan.
• The first tea company to be awarded the ISO 9001/2000
Quality Certification

As a step towards backward integration Tapal has begun tea plantation


at Shinkiari in the northern region of Pakistan. This project aims at
providing jobs, saving the country's valuable foreign exchange and is a
significant step towards self-sufficiency. Tapal is also the 1st national
tea company to export tea to the UAE, Canada and USA. This is again
a pioneering step towards increasing value-added exports and is also a
fast developing source of foreign exchange for the country.

PIONEERS OF SOFTPACKING

Technology is also harnessed at Tapal to benefit the consumer. From


the very beginning, Tapal realized the importance of importing
innovative technologies such as the soft packing process. A fully
automatic facility was established where soft packs were produced for
the first time in Pakistan. At this facility tea is blended and packed in
hygienic conditions, untouched by human hands whilst the soft packing
technology keeps tea fresh and packaging costs economical. The
success of these soft packs has been such that other tea companies
have also followed Tapal's lead and launched some of their brands in
soft packaging.

RESEARCH & DEVELOPMENT


Tea blending and tasting is both an art and a science and Tapal prides
itself on having mastered both the aspects. Tapal has judged the
senses and keenness of the taste buds of their patrons, resulting in the
creation of various well-known brands. Aftab F. Tapal is a well-trained
and highly experienced tea taster of the country and is recognized as a
qualified tea specialist worldwide. Tapal's tea managers have been
trained at home and abroad in this very rigorous and specialized
discipline, and have frequently travelled to leading tea-producing
countries searching for better teas. Tapal is a research-oriented
company. It subscribes to and conducts various researches in the area
of retail audits, consumer behavior, media planning and product
development. This research is used for continuous improvement in
product quality, brand positioning and communication according to the
changing requirements of the consumers. Consistency and quality are
the two keystones of Tapal's production policy, and the Quality Control
Department at Tapal ensures that flavor and freshness is never
compromised. That's why all the brands, whether Danedar, Tapal
Special or Tapal Family Mixture, always taste exactly as expected;
retaining aroma and freshness till the last sip.

STATEMENT OF COMMITMENT

To satisfy our stakeholders and as a guiding


principle to our business; be a Benchmark for
Quality, Creativity and Ethical values.

Achieve leadership in all categories of our


Core business and diversify in areas which
Compliment the core business.
TAPAL

“ENGAGED IN SOCIAL ACTIVITIES”

Over the years Tapal has not only provided quality products, but has
also fulfilled its social responsibility of being a good corporate citizen
by actively participating in community service activities. The company
has continuously sponsored the arts, social welfare projects and sports
within Pakistan.

~ The Tapal Cricket Club, started in 1988 has become one of the most
popular and reputable sports clubs in Karachi and has many cricketers
and professionals as its members. Tapal has also sponsored fund-
raising events for the Pakistan Medical Association such as marathons,
walks etc.

~ As part of its rural marketing program, Tapal conducts various


welfare activities in towns on an on-going basis such as providing fans
and furniture for schools, installation of litterbins for a cleaner
environment and providing street lights to municipal committees of
small towns where such infrastructure is not available. Tapal provides
support to communities at the time of crisis due to natural calamity
during which the company distributes free tea to the affected people.

~ Tapal has also recently completed the restoration of the 100 year old
Jampur Gate in the town of Jampur in Punjab. This project is a symbol
of Tapal's active participation in the country's development and
preservation of its rich cultural heritage. This spirit is also evident on
national days such as 14th August and 6th September when Tapal
celebrates with the nation by taking out a cavalcade.

PRODUCT INFORMATION

A unique combination of high-grown Kenya tea leaves and dust, that


gives a refreshing aroma of leaf and strong taste of dust all together
in one cup. Tapal Chai Family Mixture is the pride of Tapal
developed by the forefathers in 1947 and thus creating a new
category of Mixture in the tea market. It is the blend that started
the Tapal success story, and now the other tea companies are
following Tapal’s footsteps by entering the market with similar
blends. Danedar Leaf Blend Pioneer of the Danedar category in
Pakistan, Tapal’s Danedar remains a firm favourite around the
country with its grape-nutty appearances, rich golden colour and a
strong refreshing taste. In fact its popularity is such that several
multinationals have launched their own versions, but Tapal’s
remains the original and ultimate Danedar because of its unique
colour and taste.

~ Tapal Danedar Leaf Blend

~ Tapal Family Mixture

~ Mezban Super Dust

~ Chenak Kenya Dust

~ Safari Kenya Leaf

~ Gulbahar
~ Tezdum

~ Special Teabags

~ Green Tea
`Jasmine
`Cardamom
`Lemon (launching Dec 2007)
ORGANIZATIONAL HIERARCHY OF TAPAL TEA'

Managing Director

Deputy Managing
Director GM Administration
GM Production
Admin. Manager
Factory Managers
GM Supply Chain Admin Executive
Production
Managers
DC Manager Admin Officer
Production
Executives
Procurement Manager
Production Officers
Planning Manager GM Finance

Logistics Manager Accounts Managers


GM Internal audit
Finance executives
Manager internal
audit
GM Marketing Finance officers
Internal audit
executive
Brand Managers

BTL Manager
Trade operat
GM Sales manager
Export Market Manager
Insti. Sales
Reg. Managers Managers
Brand/BTL executive
Zonal Managers

Project Managers

SETUP LOCATION

~KARACHI FACTORY
Tapal Tea (Private) Limited, Plot No. 40, Sector 15, Korangi Industrial
Area, Karachi - 74900.
Tel: 5063891-4
Fax: 92-21-5063890

~RAIWIND FACTORY
Tapal Tea (Private) Limited, 3 Km, Manga Road, Near Bashir Chowk, Raiwind, District
(Kasur).
Tel/Fax: 04951-392171

~NORTH REGIONAL OFFICE


Tapal Tea (Private) Limited, 2nd Floor, Block 5, Awami Flats, 4 Usman Block, New
Garden Town, Lahore
Tel: 5868738, 5831593
Fax: 92-42-5831942

~CITY OFFICE
Tapal Tea (Private) Limited, Tapal House, Syedna Taher Saifuddin Road, Mohammad
Shah Street, Nanakwada, Karachi.
Tel: 7737202-4
Fax: 92-21-7733912
MD
SCM HIERARCHY OF TAPAL
TEA DMD

GM SCM

Distribution Center Commercial

DC Manager Commercial Manager

Commercial executive
A.M Warehouse
Commercial officer

WH exec Eng.
Planning
WH exec FG
Manager
WH exec PM
Assistant Manager
WH off POS
Planning executive
WH off PM

WH off FG KHI

WH exec HYD Procurement

WH off HYD Manager

WH exec SUKKUR Procurement executive

Tech. purchase
WH off SUKKUR coordinator

WH exec RWD

WH off RWD Logistics

WH exec MULTAN Manager


WH off MULTAN coordinator

WH exec ISLOO

WH off ISLOO

FUNCTIONS

~ INSTITUIONAL SALES

The deputy sales manager is responsible for institutional sales.


Targeting various institutions, utility stores, army depot, and now to
makro cash n carry too.

~ Planning

` Production planning

` Capacity planning (machinery)

` Materials planning ( MRP is generated by Procurement


Manager)

The company is having 52 Stock Keeping Units

~ Suppliers

` Tea buying is done mainly by suppliers in different countries.


For example in Sri Lanka there is a market setup on every
Wednesday from where the suppliers obtain samples to get them
tested and if they are approved, the purchase is finalized through
an auction.

` Procurement manager has contractual suppliers in different


countries whom he keeps rotating by increasing or decreasing the
orders to get lower prices while creating a healthy competition.

Suppliers of tea are from countries such as:

Sri Lanka
Kenya
India
China
Mauritius
Malaysia
Tunisia

` Filter papers for teabags are also imported whereas all the
packaging material used is local and is ordered as needed from
various suppliers.

~ Production / Manufacturing / Imports & Exports

` Production Units = 3
2 in KHI
1 in Raiwind
` Capacity of the production units in KHI
factory 1 with 8 machines = 22-25 tons approximately
factory 2 with 30 machines = 110-120 tons approximately

` Production plan is floated on each Wednesday stating the


required production for the next week.

` Commercial department deals in buying the tea from suppliers


which is then imported and are being cleared from the customs on
arrival at the ports

` The marketing department handles the exports to various


countries which are listed below:
`` U.S.A
`` U.K
`` Saudi Arabia
`` U.A.E
`` Russia

~ Warehouses
` Tapal has 6 warehouses

` 4 of the warehouses are owned whereas 2 are rental

The warehouses support each other or balance by shifting the


finished goods among themselves to rule out the possibility of
surplus or shortages. If any unit is not performing up to the mark,
the others make sure that it does not disrupt smooth operations.

~ Distribution

Tapal has a distribution network spread across Pakistan, from


Karachi to Khyber with over 400 distributors. Extensive training
programs are provided for the devoted sales personnel. The
popularity of its fine brands is unabated, making it the No 1 national
tea company in Pakistan.

` A wide network of 467 distributors across the nation

` 86 distributors in Karachi only

` Ex-employees contributed tremendously in building a vast


distribution network

` Competition with Unilever lead to further strengthening the


distribution network

` There are 6 warehouses under the control of the Distribution


Center Manager

~ Ordering Process

` Order sheet submitted by distributor along with the pay order


to Tapal

` As soon as the order is booked, a memo is sent to the


concerned warehouse and the order is delivered in approximately
two days subject to the location.
SUPPLY CHAIN MANAGEMENT CYCLE

Karachi Production
Raw Material Warehouse Department
Sri
Lanka
Kenya Blending
India
China Packaging
Mauritius
Malaysia Warehouses
Tunisia KHI
HYD
SUK
MUL
LHR
ISL
Support from Departments

In order to attain efficiency of the supply chain management


system, we rely on other departments cooperation and coordination
to build team work which leads to integration and strengthens the
whole unit.

~ Information Technology

` As we know that technology has replaced the old methods of


keeping records and now most of the operations are done via
different applications which are used to reduce time and increase
performance.

` Oracle Financial is used for replenishment of orders and keeping


updated records on the system gives a current status of the various
transactions and components.

` SKU development

` Trade offers / Approvals

` Documentation is all online applications

~ Marketing

Tapal has endeavored to make its marketing activities as attractive


and interactive as possible, forging a direct link with the consumers.
The recently introduced Tapal Road Show has a huge fleet of
beautifully decorated trucks conducting the road shows. These trucks
are fabricated with a kitchen, a state of the art sound system and a
side door which converts into a stage. Vans are used for conducting
merchandising activities and POS splash. Mobile Video Units are used
for projecting promotional and entertainment films.
` Commercial department facilitates imports from different
countries and custom clearance
` Exporting to different countries

` BTL

` Sponsors events (for example: Dawn Lifestyles)

` Media buying

` Promotions

~ Sales

` Provides sales forecast

` Annual Operating Plan (not efficient as projected & actual


differ)

` Operating plans

` Appointing distributors

` Liaison with distributors

~ Human Resources

Tapal's management philosophy is based on the traditional values of


the Tapal family. This mix of tradition and innovation has become the
hallmark of the winning Tapal strategy.
The company is managed by a dedicated team of highly qualified and
experienced professionals with diverse experience. Some of the key
features of the management philosophy are:

~ Accessibility-Open Door Policy

~ On-Going Training & Development

~ Discipline & Respect at every level

~ Participative Management Style

~ Performance Appraisal System

~ Excellent Employee Compensation


~ Finance

` Costing

` Payments

` Order booking Cycle

` Accounts receivable/payable dealing with distributors

` Financial projections and forecasts

` Replenishments

P.S: Cash sales only!

Recommendation and Conclusion

The journey of Tapal's remarkable success is the combined efforts of


three dynamic generations of the Tapal Family. In 1947, Tapal started
out as a family concern under the personal supervision of its founder,
Adam Ali Tapal.

To win the confidence local consumers, tapal need to revitalize the


image of TAPAL in local market. Although Tapal is a potential
challenger to unilevers but their SCM procedures are still
immature.Tapal is using Oracle They have to switch to SAP for all their
procedures. As per resource marketing and Sales Department’s
forecast present something else but actual demand is far different
from their projections.

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