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I.D # 023111

I.D# 023117

I.D # 023392


I.D # 023114

Institute Of Management Sciences Lahore

To the people who have worked
tediously through the ages to
uphold the principles of
determination, commitment and
devotion for the sake of humanity.
We wish to place on record our indebtedness to the following people for the

continuous support we received during the process of compilation of this report.

In particular to Dr. Nadeem Ahmad Bashir, our teacher, for his unrelenting interest,

keeping constant contacts and help that he gave during the process.

We are also thankful to Daewoo people for providing material relating to this report.

1. Executive Summary 1
2. Daewoo International Corporation 2
 Introduction
 General Information
 Company Chronology
 Departments
 Management
3. Daewoo in Pakistan 6
 Introduction
 Why Daewoo in Pakistan?
 Start in Pakistan
 Investment
4. Services 8
5. Special Features 9
6. SWOT Analysis 10
7. Marketing Plan 11
• Mission statement
• People vision
• Marketing objectives
• Target market
• Market positioning
8. Marketing Mix 13
• Product
• Place
• Promotion
• Price
9. Conclusion & Recommendations 15
Executive Summary

The Diagnostic study on Daewoo Express Bus Service is indeed an

informative one. Daewoo came into Pakistan for the construction of
Motorway [M-2] Project. Then they were asked to operate their Inter City
Bus Service that was from Lahore to Islamabad. The government of
Pakistan proposed this, on November 11 1999, Daewoo started Inter City
Bus Service with a fleet of initially 20 buses, which was from Railway
Station Lahore to Choongi Amar Sadhoo. Then they gradually increased
their fleet and currently they are operating with 70 buses.
Daewoo is facing severe competition with Niazi Express. Other franchise
companies like New Khan Metro, Premier are also indirect competitors of
As far as the financial situation of Daewoo is concerned, it had to bear a
large number of losses in its first two years of operations. But, it is the
growth phase. This can be judged from the fact that the percentage of net
loss was greater than 20 buses, and it reduced as the number of buses
increased to 70. So we can say that Daewoo, though now not financially
sound, has a strong tendency and in the near future it will be a
profitable enterprise. Express Bus Service started working from 1998
with 40 buses and now they are at 64 and also profitable.
Daewoo operates in the kind of industry where the entry barriers are
high. The reasons being a large amount of investment, equipment and
network are required.
The major weakness in the Daewoo Express and City Bus Services is that
their network is not extensive enough to accommodate most areas. Even
Daewoo City Buses are too much crowded.
An increase in the number of routes and buses especially in the Daewoo
City Bus Service Department is the best way of tackling this situation.



A locomotive for national economic development since its founding in

1967 as Daewoo Industrial Co., Ltd., today’s “Daewoo International
Corporation” is the new vanguard of Korean Trade. The company played
a leading role in overcoming economic crisis in 1998 by achieving top
results in export and trading surplus. Throughout its long history, the
company also played a major role as a vanguard in non-governmental
diplomacy. The company’s dynamic trade policies led to the
establishment of diplomatic ties with 13 nations as well as to the
expansion of export markets by setting up Korea’s first trade branch
office in 37 countries. Daewoo Corporation was reorganized into three
new companies in order to normalize all operations: Daewoo
International Corporation in trade, Daewoo Engineering and
Construction Co., Ltd., in construction and Daewoo Co. in others.
Having normalized operations, Daewoo International is leaping into the
new millennium with more than three decades of international marketing
expertise, international trading man power, high quality products and all
inclusive domestic and international sales networks. With such reliable
qualifications, the company looks forward to positioning itself as a truly
global leader in world trade.
With its own distinctive technology and development capabilities,
Daewoo international has been, for more than three decades, a
worldwide name for fine quality products. Now, with new
environmentally friendly materials, the company augmented its renown
and reliability in material for footwear, garments, car interiors
components and miscellaneous goods. First in Korea to acquire ISO 9002

and QS 9000 quality certification in its field, the company continues to
expand its global exports and develop new trade strategies. With its solid
capabilities in manufacturing technology and improvements in both
process and quality, Daewoo International is steeping into the new
millennium with top competitiveness, top products, and top services.

General Information

Name of the company Daewoo International Corporation

CEO Lee Tae-Young
541 5- Ga
Address Namdaemunno, Chung Gu, Seoul,
Korea, G.P.O Box 2810

Fax +82+2-753-9489

Company Chronology

Established as Daewoo Industrial

Mar. 22, 1967
Co., Ltd
Merged with Daewoo Development
Jan. 1, 1982
Co., Ltd;
Ranked first in Korea in exports
and trade surplus
Number of staff: Approx. 9000
Overseas network: Subsidiaries: 70
Branch offices: 49
International Trading, Overseas
Resources Development, Domestic
Major business areas:
and Overseas Investment Business
Overseas Projects, etc.
Organization 10 Division, 51 teams

 Corporate Restructuring
 Finance

 International finance and overseas management
 Office of management
 Staff of legal affairs


With 30 years of experience, Daewoo’s Management Development Center

recently introduced new visions to foster personal efficiency and
advancement. The center is initiating a number of systematic new
programs for employees, as well as innovative steps as the leading of
training facilities, operation of consignment training, and public lectures.

Daewoo in Pakistan


As Daewoo has a name all over the world due to interest in automobiles,
consumer goods, financial and securities, construction, engineering and
trade sector, Daewoo is working for the last thirty years and their motto
is “from tile till ship”.
Daewoo, a top Korean company, emerged in Pakistan in 1993, when it
sort $1 billion in Lahore- Islamabad Motorway Project which was highly
political in nature. Though it discouraged in getting more projects but
with the re-election of Nawaz Sharif Government, Daewoo has come with
its renewed commitments in taking part in development related activities.
In the first phase, company would import buses from Korea and intends
to invest $60 million in its transport venture which would have 600
buses fleet in total. Company source says that it is also considering
installing a bus assembling plant to take part in the massive demand of
passenger transport.
The company commenced its business on December 10, 1997 after
obtaining certificate for commencement of business from registrar of
companies, Lahore. Daewoo Pakistan Motorway Services Ltd. was
incorporated as a public ltd. company on October 23, 1997. The object of
the company was to provide services on Lahore- Islamabad motorway.
Daewoo Pakistan Express Bus Services Ltd. was incorporated as a public
ltd. company by shares with the object of engaging in transportation
business. Their detailed description activities are:
 To plan, survey, design, finance, construct, own, operate and
maintain bus services.

 To carry on the business of transport of goods, mails, passengers,
animals from place to place either by air, by land or sea whether in
airplanes, motor-vehicles, cars, ships or in any manner what so
 To indulge in higher transportation services in all the parts of the

Starting in Pakistan

In May 1999, Daewoo signed memorandum of understanding with the

Government of Punjab at Seoul, Korea to operate 1500 buses in Pakistan
out of which 700 buses were proposed to be operated in Punjab whereas
800 buses in Sind.
It was also agreed that government would provide the requested funds
for this project from outstanding payment on the construction of Lahore-
Islamabad Motorway Project. Anyhow, this agreement could not be
materialized and due to the certain reasons and eventually Daewoo had
to arrange funds for import of 50 buses through financial institutions
and those maintain its commitments made with the citizens of Pakistan.
To operate the city bus in Lahore, a franchise agreement was signed on
August 3, 1999 between Daewoo and Lahore Regional Transport
Authority, Government of Punjab.


To commence its business on January 12, 1998, after obtaining

certificate for commencement of business from Registrar of Companies,
Lahore, the company has planned an initial equity investment of US $ 1
million. The total cost of the project has been estimated at $ 6.526
million, which the company proposes to finance, by equity investment of

$ 5.095 million and by loan arrangements of $ 1.431 million. In this
project, as well, Daewoo wants 100% equity in the project instead of 60%


There are two types of services that Daewoo is providing in Pakistan

which are as follows:
1. Express Bus Service
2. City Bus Service

Express Bus Service

This is the inter-city bus service of Daewoo International Corporation in


Major routes

 Lahore - Islamabad
 Lahore - Multan
 Lahore - Sargodha
 Lahore - Faisalabad
 Rawalpindi - Murree [wagon]
 Lahore - Peshawer

City Bus Service

This is the intra-city service of Daewoo International Corporation in
Lahore, Pakistan. This department offers an extensive transportation
network within Lahore through a fleet of 70 buses.
Daewoo is also considering the launch of this service in other
metropolitans such as Karachi.

Special Features
[Daewoo Express]

It provides its services from cities to cities comparatively to the other

companies, Daewoo aims to provide following services for their

 Smooth drive with reclining seats

 Refreshment
 Audio/Video entertainment
 Centrally heated and air-conditioned
 Reservation facilities
 Pick and drop facilities
 Punctual departures and arrivals
 24 hour service
 Computerized ticketing
 Courteous hostesses
 Armed security guards
 Cargo service
 Expert drivers

All these points are advantages for Daewoo over all the other
transportation companies in Pakistan.

SWOT Analysis

Strengths Weaknesses

1. Brand name
2. Unique Service
3. State-of –the-art equipment 1. Lack of an extensive transport
4. Professional management network
5. Trendsetters 2. Over crowding of vehicles
[in transportation] 3. Insufficient marketing
6. High traveler satisfaction intelligence
7. Extensive Employee Training

Opportunities Threats
1. Well established competitors
1. More buses, routes and a 2. Government policies
greater range of transport 3. Fluctuation in fuel prices
network 4. Up coming companies
2. Better management of 5. Intensive disturbances on the
available resources roads
3. Innovative Marketing 6. Non-availability of spare parts

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“We envision growing in the shortest possible time into number one traveling

company in Pakistan with the unique ability to meet the needs of consumers of

every age group for facility and pleasure through development of highest quality

and customer-care services.”


We envision the company to develop an extremely motivated and professionally

trained work force, which would drive growth through innovation and renovation.

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The fiscal and political policies and economical conditions of the government and its
efforts are creating a generally business friendly environment are likely to help in the
economic turn around. The international community is supplementing these efforts to
overcome economic difficulties. These indicators are holding out the hope that the year
2004 may be better for business. However, it is early to say with any finality how
business will develop, given certain uncertainties that still prevail. On our part we are
confident that we will maintain our growth momentum and perform well in the coming
year. Our focus will remain on a long-term view of the business, quality consciousness
and efficiency through innovation and renovation in all areas of operation.


Our target customers are middle and upper class citizens who think time is more precious
than money and sufferings of using conventional traveling medias.


We want positioning our company as the company, providing comfortable traveling

experience with a nice cooperative and friendly staff.

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Daewoo will provide traveling services using innovative techniques and modern
technologies with a friendly and gentle environment.


The company will make sure that service is available throughout the country at all the
suitable locations.


Effective marketing remains the hallmark of Daewoo as a company involved in supplying

services with a great emphasis on effective long-term strategies. Its services (traveling,
pick & drop, cargo etc) will be promoted through out the country using a network of bus-
It will ensure consistent and balanced growth, despite adverse market conditions. As a
result, Daewoo will enjoy an extremely high degree of recognition and reliability, which
has earned leadership positions for most of its services. Its more and more branches will
be initiated in other cities where demanded.


After developing their pricing structures and strategies, companies often face situations in
which they must initiate price changes or respond to price changed by competitors. In
some cases, the company may find it desirable to initiate either a price cut or a price
increase. In both cases, it must anticipate possible customers and competitor reactions.

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Several situations may lead the firm to consider setting its price. One such circumstance
is excess capacity: In this case, the firm needs more, business and cannot get it through
increased improvement or other measures. It may drop its "follow-the-leader pricing"—
charging about the same price as its leading competitor—and aggressively cut prices to
boost profit.
A successful price increase can greatly increase profits. For example, if the company's
profit margin is 3 percent of fare, 1 % price increase will increase profits by 33 percent if
fare volume is unaffected.

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Conclusion and Recommendations

1. Daewoo is an international brand and through its high quality and

exclusive services, it has gained a good repute in the local
transport business. But it has been seen that Daewoo Corporation
has not lived up to its name as far as the establishment of an
extensive transport network is concerned. Passengers in most
areas of Punjab and in all the other provinces of Pakistan have no
access to the Daewoo Bus Services. There is also a great need for
an inter city transport network of Daewoo in metropolitans such as
Karachi, Rawalpindi and Faisalabad etc.

 This problem can be dealt with by increasing the no. of inter city
and intra city routes and buses as well as increasing the range of
transport services.

2. It has recently been observed that following a tremendous growth

in the number of passengers, Daewoo Intra City Bus Service has
suffered great over-crowding which has deteriorated the standard
of comfort claimed by the company.

 One probable solution to this problem is again an increase in the

no. of transport vehicles and routes. Moreover, a better handling
and management of the present bus routes and the number of
buses can also lead to a more pleasant situation.

3. I was quite shocked to know in my meeting with Executives of

Finance and Marketing of Daewoo, Pakistan that no advertising

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campaign has ever been launched to highlight the comparative
superiority of the company over its local competitors.
Consequently, a large proportion of consumers remain unaware of
the great facilities afforded by the bus service.

 Therefore, advertisement is a feasible and necessary way for the

bus service to attract passengers who are unfamiliar of the high
class and uniquely elegant transportation experience- offered by
Daewoo- and hesitate when spending on the comparatively high
Daewoo bus fair.

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