c




 
 



 

The Principal,
Hailey College of Commerce
University of the Punjab, Lahore



 

Abdullah Jawad
477
8th semester
B.com Honors
2006-2010
Hailey College of Commerce
University of the Punjab, Lahore

 

Sep 10, 2010 

 ˜ 

  

10 September 2010

Abdul Rasheed
Hailey College of Commerce
University of the Punjab , Lahore.


Submission of the internship report. 

Dear Sir

I feel immense pleasure in presenting to your good self, the internship report
as part of our course requirement. I found this report to be truly challenging in
many aspects, indeed very interesting in relation to the various interpretational
and engrossing exercises. Writing this report itself was truly comprehensive
learning experience.

The report covers some background and introduction of Emco Industries. It

covers analysis of financial ratios of two recent years and includes SWOT
analysis. It also covers the details of skills acquired during the internship
period and conclusions and recommendations.

I have tried my level best to complete the report with respect to the desired
requirements. However, if any explaining is required, I would be honored to
oblige.

Yours sincerely

Abdullah Jawad



  

I am very grateful to Accounts Manager Mr. Rizwan for giving me the

opportunity to do the internship.

I am also thankful to the employees of Emco Industries for their cooperation.

They have been very helpful in teaching me different procedures of relevant
information in as much details as possible . They never hesitated or did not
feel disturbed when I asked questions. It was a great opportunity to do
internship in such an organization. The experiences I have gathered will be
very beneficial in my career.
    

   

List of Illustrations/Charts ------------------------------------------------------------------------------------ 5

Executive Summary ------------------------------------------------------------------------------------------- 6-8

Historical Overview/Introduction --------------------------------------------------------------------------- 9-14

Introduction to Meezan Bank ------------------------------------------------------------- 9-13

Branch Network ----------------------------------------------------------------------- ------- 13-14

Corporate Profile ----------------------------------------------------------------------------------------------- 14-16

The Management Team ------------------------------------------------------------------------------------- 17-18

Vision and Mission Statements ---------------------------------------------------------------------------- 19

Ratio Analysis and Interpretation --------------------------------------------------------------------------- 20-27

SWOT Analysis ------------------------------------------------------------------------------------------------ 28-30

Skills acquired during Internship program --------------------------------------------------------------- 31-78

Introduction to Products -------------------------------------------------------------------- 31-47

Profit Rates ------------------------------------------------------------------------------------ 48-51

Current Weightages ------------------------------------------------------------------------- 52-55

Pre-encashment Schedules --------------------------------------------------------------- 56-58

Car Ijarah -------------------------------------------------------------------------------------- 59-60

Credit Administration -------------------------------------------- ---------------------------- 61-63

Home Finance -------------------------------------------------------------------------------- 64-66

Pay Orders and Cheque Books ---------------------------------------------------------- 67-69

Other Facilities -------------------------- ------------------------------------------------------ 69-72

Account Opening ----------------------------------------------------------------------------- 73-78

Conclusion and Recommendations ----------------------------------------------------------------------- 79-80

Bibliography ----------------------------------------------------------------------------------------------------- 81
 ˜ 
 


  

Meezan Bank Key Data ---------------------------------------------------------------- 12

Earnings and Dividend Graph --------------------------------------------------------- 13

Credit Rating ----------------------------------------------------------------------------- 16

Shareholding Structure ------------------------------------------------------------------ 16

Organizational Structure ---------------------------------------------------------------- 18

Ratio Analysis Tables & Chats -------------------------------------------------------- 20-27

Introduction to Products ----------------------------------------------------------------- 31

Profit Payment Tiers --------------------------------------------------------------------- 35-46

Investment Tenure and Profit Payment --------------------------------------------- 43,46,47

Profit Rates --------------------------------------------------------------------------------- 48-51

Current Weightages ---------------------------------------------------------------------- 52-54

Pre-encashment Schedules ------------------------------------------------------------ 56-58

Entitlement Calculation (Car Finance) ----------------------------------------------- 60

Profit Calculation Method --------------------------------------------------------------- 63

Entitlement Calculation (Home Finance) ------------------------------------------- 66

 c!
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The parent company,    

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   %" &' ˜ &( was
established in 1931 and has been involved in trading of electrical
goods. Soon after the creation of Pakistan, the needs for import substitution
was felt and the sponsors of the parent company made the decision to
establish a small manufacturing unit for electrical goods. 

In 1951, a very modest beginning was made by setting up a small facility

located in the basement of the offices of The Imperial Electric Company (Pvt.)
Ltd., for the production of electrical accessories. With single minded initiative
and efforts of Late Mr. AtaurRehman (the former Managing Director), the
facilities were continuously upgraded and a full fledged facility was
established in Lahore, Pakistan by 1954 under the same name of c



c)   *

 & ˜ & %c* #'& The first comprehensive
Insulator Manufacturing Plant was in operation with the active participation,
know-how and machinery coming from Japan and France.

Keeping pace with the ever increasing and diversified demand of Insulators
for national utilities and electrical industries in Pakistan, it was decided in
1965 to expand the facilities to produce all types of insulators including those
required for extra high tension lines. At this stage, Associated Engineers
(Pvt.) Ltd., joined hands with The Imperi al Electric Company (Pvt.) Ltd. (IEC)
to further expand EMCO.

The new plant located at Lahore Sheikhupura Road, Lahore was

commissioned in 1968 under the guidance of competent and seasoned
engineers of NGK Insulators, Japan. Since electrical ceramics is a very highly
specialized industry, requiring skill, experience, time tested formulae and
proven know-how, EMCO signed a technical collaboration agreement for
fifteen years with NGK, Japan, who are the world's largest and most
renowned manufacturers of insulators. With the active support of the
personnel from NGK and Pakistani engineers, EMCO was producing quality
insulators using mostly local raw materials. The plant is now manned by a
team of highly qualified and experienced Pakistani engineers apart for m over
600 technicians and workers. The company has a present installed annual
capacity for the production of 6000 tons of insulators which is being upgraded
to 7500 tons by the end of 2006.

With the untiring efforts of the present Chairman, Mr. S. A.Mann an and the
late Managing Director, Mr. AttaurRehman, the company continued to be one
of the best facilities manufacturing quality insulators in the world. In 1983, the
company was listed on the Stock Exchanges of Pakistan as a Public Ltd.,
company and was renamed as EMCO Industries Limited.

In addition to electric porcelain, EMCO runs a full fledged department for the
production of chemical porcelain such as acid proof lining bricks, raschig
rings, saddles and special refractories. This line is now fully developed to
cater to the requirements of beverage factories, milk plants, chemical, edible
oil, fertilizer industries, for acid proof wares. EMCO, in 1995, signed a
licensing agreement with M/S. SIEMENS, Germany to manufacture Surge
Arresters from 66kv to 420kv (max. system voltage).

EMCO, in 2005, signed a know-how contract with M/S. HAPAM B.V.,

Netherlands, for the manufacturing of Disconnecting Switches.

EMCO firmly believes in a continuous research and development programme

to keep abreast with ever -diversifying requirements of porcelain insulators,
chemical porcelain and ceramic tiles. The normal production of insulators
requires rigid quality control, with limited performance tolerances
allowable. Considerable efforts, as such, are directed towards the production
of insulators with better performance characteristics and EMCO has all the in -
house testing facilities for this purpose. Moreover, our progress and
development is benefited by the rich experience gathered from NGK of
Japan. EMCO is still the only unit for manufacturing high tension insulators in
Pakistan and is not only supplying the entire requirement of the country, but is
also exporting to developing and developed countries all over the world.

Having achieved an enviable position in the field of electric ceramics, EMCO,

in 1983 decided to broad -base their manufacturing activities and utilize their
long experience in ceramics by adding an ultra modern plant for the
manufacturing of decorative WALL TILES with an annual capacity of 700,000
square meters. The entire machinery for the manufacture of tiles was
supplied by world renowned machinery manufacturers from Germany and
Italy. This plant was commissioned in 1985.

Another plant for Floor Tiles having an annual capacity of 1,000,000 squa re
meters was commissioned in late 1991. The machinery and know-how was
supplied by SACMI of Italy and the plant is producing comprehensive range of
Floor and Facing Tiles according to international standards. In 1996, the
need was felt to increase the p roduction of the Wall Tile and subsequently an
agreement was signed with an Italian Company to supply machinery and
equipment to increase the output of the Wall Tile plant form 700,000 to
1,500,000 square meters per annum. This expanded facility was completed
in 1997. Currently the overall production capacity of both plants is 2,500,000
square meters. EMCO is the largest ceramic complex in Pakistan producing
over 30,000 tons of ceramics material annually .

+


The parent company Imperial Electric Comp any (Pvt.) Ltd. was established in
1931 and the group now consists of the following companies

c

˜   

c
  

  

Commonly known as ³EMCO´, they produce all types and sizes of high and
low voltage porcelain insulators and other porcelain products including high
voltage switchgear equipment. The plant was set up with the technical
collaboration of NGK Insulators Limite d of Japan. EMCO is meeting
Pakistan¶s entire demand for insulators and also export to a number of
countries in Middle East, Africa and Europe. EMCO also produces Wall and
Floor tiles.


  
c


 &%" &'˜   

c
  

   

They are leading OEM of Diesel Generating Sets (5 ~ 750 KVA). They are
also engaged in the indenting and sale of power generation, transmission and
distribution equipment and other industrial materials. They represent the
world's most renowned manufacturers which includes Copperweld, Puma
Power Plants, Alcoa, Foster Wheeler and Mirrlees Blackstone.

 %" &'˜  

c
  

  

The company is engaged in design, supply of materials and construction of

transmission lines, substations, industrial plants, process equipment and pre -
stressed concrete pole plants.

 ! ˜   

c
  

  

The modern weaving plant is producing premium quality grey fabric, primarily
for the export market. It has an annual capacity to produce 40 million square
meters of grey fabric based on middle range cott on and cotton polyester
blends.The plant is equipped with 100 SulzerRuti Projectile P7100 weaving
machines and 72 high speed air jet JAT 710 weaving machines of various
widths from Toyota, Japan, along with complete European back process and
ancillary equipment.


c



 ˜ 

  .

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Commonly known as AETCON, was established as a joint venture between

ICC (Pvt.) Ltd., (Lahore, Pakistan) and Tamimi Company (Dammam, Saudi
Arabia) for the construction of High Voltage Transmission Lines and Sub-
stations on Turn-key basis.AETCON is presently registered in Abu Dhabi and
Kingdom of Saudi Arabia.
:*    

:

While enhancing our "Stile" Brand as a Market Leader, Focusing our Human
Capital, continues to delight our Customers in the field of Building Materials,
Offering Best Quality Innovative Products at Prices Be -Fitting Stile Brand.
Improving Efficiency, Conserving Energy and being Environmental Friendly.
Taking into account the Stakeholders Interest.

#
"

³Making our customers winners by constantly exceeding their expectations.´

*    

Our Mission is to maintain our position as the leader in the tile industry in
Pakistan and for this purpose we will continue to focus on:

á We are committed to quality products and will provide our customers

with innovative sizes, designs and color scheme that they will be
delighted to have and shall provide them with excellent services to earn
their loyalty

á We shall treat our employees fairly and shall provide conducive

working environment for them to learn and to grow with the company

á The company shall earn adequate profits for its progress and grow th
and for providing reasonable return to its stakeholder
#+,-#,. .c

Company EMCO Industries

Major Industry Electronic Products
Sub Industry Ceramic Tiles
Country PAKISTAN
Employees 1200



 
 

*   

&&*
Chairman


) 
Managing Director

@
,

Director Marketing

 *
Director Production

  
Operative Director

 *
Operative Director

* /@
General Manager Plant(Insulator & Tile)

*
0 
Chief Financial Officer
General Manager Marketing (Tile Division)

 
 1
 
Manager (S&M) Insulators

 







  

A. F. Ferguson & Co.

 
$@#


@#


119-E/1, Hali Road, Gulberg -III, Lahore.P.O.Box No.36

Phone: (092) (42) 3587 2181 - 84

Fax: (092) (42) 3587 2191

Email: info@emco.com.pk

2

" 

19-Km, Lahore Sheikhupura Road, Lahore.

Phone: (092) (42) 7970293 -4, 7970195

Fax: (092) (42) 7970593

Email: tile@emco.com.pk

2

 
" 

19-Km, Lahore Sheikhupura Road, Lahore.

Phone: (092) (42) 7970293 -4, 7970195

Fax: (092) (42) 7970592

Email: insulator@emco.com.pk
#
  

Plot No.269-A, Street No.6, I -9/3, Industrial Area, Islamabad, Pakistan

Phone: (092) (51) 443 -1719/21

Fax: (092) (51) 443 -0348

Email: islamabad@emco.com.pk

#
3

 

45-C.P & Berar Housing Society, Block 7 & 8, Amir Khusroo Road, K arachi.

Phone: (092) (21) 454 9827 - 9

Fax: (092) (21) 454 9861

Email: karachi@emco.com.pk

#
˜ 
 

204-Ferozpur Road, Behind Rehmanpura Bus Stop, Lahore, Pakistan.

Phone: (092) (42) 753 -2802 - 3

Fax: (092) (42) 753 -2801

Email: lahore@emco.com.pk

 
˜ 
 

204-Ferozpur Road, Behind Rehmanpura Bus Stop, Lahore, Pakistan.

Phone: (092) (42) 753 -2802 - 3

Fax: (092) (42) 753 -2801

Email: lahore.display@emco.com.pk




Emco industries have two types of products.

4&  


5& 
 


 


 

Aero Form Insulators
Fog Type Insulators
Normal Insulators
 

Normal Pin Type Insulators
  

Line Post Insulators
Station Post Insulators



 
Transformer Bushing



 

11KV
132KV

     

Cutout Insulator
 
 

Shackle Insulator
+
 

Guy Strain Insulator
˜ 






 


,
 



2
 


2 

  



,
 

B.S. Standard Type




 




 




 


443:
 4653:


     


   

 
 


 
 

 +
 


+
 

+
 


+
 

˜ 


 
 


0789:799; <7998749=
Traditional Prints & Effects
Series Size: 30 x 30
Size: 20 x 20 CM
CM



á Geometric Series
á Hala Series
á Plain Deep Base
á Plain pastel Base
á Prints and Effects
á Rustic Series(Floor Tiles)
á Semi Matt ± Granallia
á Semi Matt ±Plain
á Semi Matt ±Shaded
á Semi Matt ±Texture
á Texture Dark Base
á Texture Light Base
á Traditional Series

/

á 20x20 cm 
á 25x25 cm 
á 25x33 cm 
á 30x30 cm 
á 38x38 cm 




Project : *˜˜#.,c

NesPak

Lahore, Pakistan.
This project was designed by EMCO. Emco tiles 30x30 cm
are installed on both sides of walls.

Project :  c3,˜&

Emco

Main Boulevard Gulberg, Lahore, Pakistan.

Emco tiles 30x30 cm installed in all shops of three floors &
wall tiles installed in different washrooms.

Project : @2#˜2c.

Sughra Shafi Hospital

Narowal, Pakistan.
Emco tiles 20x25cm & 20x20 cm installed in major parts of
the hospital.

Project : ˜* .,:c>

Higher Education Commission

Islamabad, Pakistan.
Emco tiles both glazed & matt 20x20 cm installed in various
parts of the university.






 

Technical specifications of glazed floor tile according to European standard

norms en-177 group BII,A

TEST
VALUES OF
REQUIRED ACCORDING TO
CHARACTERISTICS EMCO
VALUES EUROPEAN
PRODUTS
NORM
Length & Width 0.5% 0.4% EN - 98
Thickness 5.0% 2.5% EN - 98
Straightness of Sides 0.5% 0.15% EN - 98
Rectangularity 0.6% 0.25% EN - 98
Surface Flatness (a)
Deviation From Centre 0.5% 0.2% EN - 98
Curvature
Surface Flatness (b) Edge
0.5% 0.25% EN - 98
Curvature
Minimum 95%
Surface Quality will be free from ¡Ý 95% EN - 98
visible defects
Av.3<6 Av.3<4
Water Absorption Individual Individual EN - 98
Maximum 6.6 Maximum 4.5


 



Analytical/test reports of ceramics wall tiles by P.C.S.I.R

Test Results
Water Absorption 13%
Dimensions Thickness 6.5 mm 2%
Dimensions
0.2%
Rectangularity
Surface Flatness -
0.2%
Centre Curvature
Surface Flatness -
0.2%
Edge Curvature
Surface Quality >95%
Modulus Rupture 215 Kg/Cm



Contact
Dealer Name City Address Phone Fax
Name
85-
MAGOON Lahor 3753149 3758751 MR.TANVEE
FEROZEPUR
SONS e 0-1 7 R, MR.ALI
ROAD ICHRA
186-
FEROZEPUR
M.I.SANITAR Lahor 7575494-
ROAD OPP MR.IDREES
Y STORE e 5
GALAXY
CINEMA
172-
A.H.TRADER Lahor 5730301- MR.IMRAN
H.COMMERCI
S e 5728839 MALIK
AL ZONE,


˜
 


EMCO maintains a well equipped laboratory where fundamental research

for development and routine quality control tests are carried out.
Following are the quality control tests performed in laboratory on Raw
Materials, Porcelain Bodies, Glazes, Cement and Plaster of Paris.

* 


* Visual Check
* Refractoriness
* Particle Size
* pH
* Viscosity
* Chemical Analysis





* Particle Size
* Water Content
* Viscosity & Temperature
* pH
* Cake Hardness
* Foreign Substance
* Shrinkage
* Sintering
* Refractoriness
* Chemical Analysis
* Thermal Shock Resistance
* Thermal Expansion
* Mechanical Strength
* Dielectric Strength

+/

* Particle Size
* Water Content
* Viscosity
* Color & Gloss
* Refractoriness
* Thermal Expansion
* Chemical Analysis
* High Temperature Fluidity
* Body & Glaze Matching
* Electrical Conductivity

* Flow Value
* Mixing Ratio
* Setting Time
* Tensile Strength
* Compressive Strength
* Thermal Expansion

 



* Mixing Ratio
* Setting Time
* Tensile Strength
* Expansion
* Sieve Analysis
1  


EMCO has a very strict quality system and checks are kept at a number of
stations of the manufacturing process. The system of quality assurance is
according to ISO 9001.

?#


 
EMCO has the following strengths and is in more competitive position in
these areas than its competitors. Following are the main strong points of EMCO

Ú Strong brand image

Ú Strong dealer network
Ú Strong quality, sale and service
 Ú Pioneer in Market
Ú Market Leader in Ceramic Tiles
Ú Strong grip in Construction Materials
Ú Strong Management
Ú Distribution of Authority
Ú Strong research and development department
Ú Free customer service



 
EMCO has created the strong brand image in the mind of the customers
through higher quality and low price. The customers of the EMCO always prefer to
buy the EMCO Tiles.

EMCO is a popular company in Pakistan and every one knows about the EMCO
products and its brand. That¶s why EMCO selling of Tiles are very high in the market
than the competitors selling.



, 

It is also the plus point for the EMCO that it has also developed the strong
dealer network in the market. The dealers are always trying to sell the
EMCOproducts to the customers because they know there are high margin in the
EMCO products. They can get more money after selling the EMCO products. Th e
management of EMCO also provides more incentives to their dealers than their
competitors. Dealers are very conscious about the EMCO products and always guide
the customer in buying the EMCO products and tell them the more qualities of EMCO
products than others products.


1 (
"
 
EMCO is also in a strong position that it provides the superior quality to your
customers. It makes sense in the mind of the customers that EMCO products are
better in quality than the other companies¶ produ cts. EMCO also provides the after
sale service to their customers which delight the customers satisfaction. It is another
way to advertise the products because when customer is highly satisfied then he tells
the other ten persons that they should buy the E MCO products. It is the free publicity
of EMCO products that EMCO Company gains.
*
 
 
 

It is another strong point that EMCO is a market leader in Ceramic Tiles. The
Wall tile is more demanded by the customers than its competitor¶s wall tilesbecause it
has more durability .EMCO always strives to provide the innovative features in
Ceramic Tiles. EMCOCeramicTilesis cheaper and has a higher quality than others
Ceramic Tiles. That¶s why customers always purchase the EMCO wall tiles.

, 
5 
 
  
After the Master TilesEMCO has a second position in Ceramic Tiles market.
EMCO always continuously strives to pursue the strategies adopted by the
competitors. As a consequence the price war starts among the companies so each
company reduces the prices and try to increase the sales of its refrigerators. EMCO
is also making efforts for the quality improvements than its competitor Master.


+
@ 



So EMCO is one of the companies, which is having a strong grip in the home
products i.e. wall tile, Floor Tile, etc that is a strong point for the company. EMCO is
penetrating the market by introducing the new home products like different sizes of
tiles and always trying to get the maximum shares in the market.


*  
It is another plus point that EMCO has a strong management. Its employees
are more competent and fully skill and knowledge. They always cooperate the top
management in achieving the goals that are assigned to them. Employees are well
aware about the company objectives and so they are committed to the development
of company.


  
 
Top management of EMCO delegates the power to the subordinates for
achieving the marketing objectives in a specified time period. So every man ager has
an authority that use in achieving the Goals. He can easily handle the complaints of
customers and try to satisfy them. So it is a strong point for the EMCO because there
is decentralization of powers.



"  
 
EMCO has a strong research and development department that is
continuously trying to develop new features for the products.

R&D department spends huge amount of money for the development of

product. R&D makes research for introducing the new product and as ks the
customers what they want extra in our products. For this purpose they hire the highly
qualified employees in R&D department. That is another strong position of EMCO.

2
   

"


EMCO provides free customer service to its customers. So the customers

always buy the EMCO products due to its free service and it becomes loyal customer
for the EMCO. EMCO always provides help to their customers for rep lacing the faulty
Ceramic tiles. EMCO always make efforts to satisfy the customers.


˜    

Although EMCO is owned by the EMCO Industries but its shares can be
purchased and sold in stock exchange market. So every one who is interested in
purchasing the shares of EMCO he can purchase. It is also called public limited
company. So people are more interested in buying the EMCO products.

?
Like other companies EMCO has some weaknesses in operating the
business. If EMCO overcome on these weaknesses then it can become a
market leader in the home products. EMCO loose some competitive edge
in the following points

Ú System variations
Ú Lack of Product Variaty
Ú Less Utilization of capacity
Ú Financial Problems

  :
 
It is also the main weakness of EMCO that there are rapidly a change in
polices of selling the products.
 That¶s creates problems for the selling team how to sell the products to the
dealers because the top management requires the urgent amount of money. So
selling team sells the products sometimes on hard cash that will reduce the prices of
products that giv es the benefits to the dealers and creates problems for the
management.

˜


:
 

EMCO has introduced more products of consumer items but there are more
needs to develop new consumer items like EMCO different styles and different sizes
of Tiles. Due to lack of productRange, Company cannot earn more profit because
consumers have high demand of these products and they say that if company is
investing in these products then we can keep all EMCO items an d we never need to
keep other¶s company products.

˜. /  
 

Due to lack of finance a company cannot utilize all its resources on its full
capacity. It increases the cost of products per unit that decreases the profit margin of
each consumer item. Sometimes company cannot allocate the resources according
to the requirements of production department that¶s becomes the problem for the
complete utilization of resources. For the company it is also the main point of
weakness.

2

 
Sometimes EMCO faces the financial problems because its stocks are so
much piled up in the stores that create the problem of cash flow because when the
stocks are not sold and the production is in process for 24 hours a day than the
company faces such problems. So a company aggressively researches the sources
of cash and stresses the dealers to sell the EMCO¶s products to the end consumers.
Company sometimes sells their products on advance bases to the dealers and gives
them high margin of profit. That¶s w hy a company is facing the financial problems and
company never pays attention on the alternative resources that will help in reducing
the stocks. That is a customer demand and due to this it is the main weakness of
company.
#
 
For the EMCO there are more opportunities for expansion the business. If
EMCO realize that opportunities then it will be more fruitful and profitable for the
company. Even if company does not take advantage of these opportunities then it will
loose its competitive positio n and high profit. Its competitors will give EMCO tough
time to pursuing the opportunities that are adopted by them. Following are the
opportunities for the EMCO.

Ú Exploration of market in Pakistan

Ú Increase in product range
Ú Export opportunity
Ú Increase in production capacity

c!
 *
   
EMCO has the opportunity to explore the
market in all over the Pakistan. Even though EMCO introduce its products in all cities
of Pakistan but there are so many places that have the capacity to absorb the
EMCO¶s products. These places are tribal areas in NWFP and northern areas of
Punjab and NWFP, central area of SIND. If company introduces their products in
these areas then it can get a lar ge amount of profit and increase its market shares.





 

It is the main opportunity for the EMCO that it can increase its product range
that will be a more profitable for the company. There are more needs to develop new
consumer items like EMCOdifferent style and size of ceramic tiles, Granite and other
items. Due to lack of productRange, Company cannot earn more profit because
consumers have high demand of these products. If EMCO does not take this
opportunity then it will loose high margin of profit and market share. It will reduce the
fixed cost and increase the efficiency of the employees.

c!
#
 
EMCO Company has also the opportunity to export their products in other
international countries like UAE, SAUDI ARABIA, and ot her Arabic and African
countries. It will not only reduce the dependence on one market but also increase the
market shares and profits. It will also help the company to spread the fixed cost on all
of its production that will reduce the total cost and comp any will enjoy the high profit.




˜ 
Company can also increase its production line at the maximum level that will
increase the efficiency of the employees and also will reduce the total cost.
Sometimes company cannot allocate the resources according to the requirements of
production department that¶s becomes the problem for the complete utilization of
resources. Company should look the market conditions then it will produce their
products.


 
EMCO Company in such a competitiv e era has many threats as well. These
threats are for the present situations and future. Company should make its policies
and strategies according to these threats. So following are the main threats for the
EMCO

Ú Strong competition
Ú China¶s product introdu ction in the
market
Ú Price war
Ú Slow growth rate in Pakistan
Ú Instability of government
Ú Tax department
Ú Investors






    

There is very strong competition for the products in the market. So every
company tries to come in the number 1 position for achieving the maximum
shares in the market. Every company adopts different strategies for selling of
the products. It reduces the profit margin of each company and increase the
bargaining power of the buyers who will demand higher quality of products
and lower cost. That is the main threat for the EMCO Company &
 @



China¶s products are another threat for the Pakistani companies because
these products are cheaper than the Pakistani products. An even china
product not well in quality but it is comparatively in low prices than the
consumer¶s home products that are manufactured by the indigenous
company. China products stress the indigenous companies to lower the
quality and prices that will not be profitable in the long run.






There is stiff competition in the products market that will cause the price war.
So every company reduces the prices of its products to increase the sales. It
will not only reduce the profit ma rgin of the company but also reduce the
quality of products. So price war is the main threats for all the companies,
which are operating in these products. 

+
   

There is also slow growth rate of home products in Pakistan that will increase
the stocks of the company. It becomes the burden for the company that how
to sell these stocks. Its main reason is that purchasing power of the buyer is
very low and it has no income to buy the expensive the home products. It is
also becoming a main threat for all the companies.

  +"
  

The rapid changes in governments will become threats for the companies
because every government adopts its own policies for the industries. So it
increases the uncertainty for the investors who wan t to invest heavy amount
in their new projects. That¶s become the major threat for the companies and
decreases the profitability. Due to fear of politically instability companies will
also not invest the heavy amounts.
!
 

Tax department is another major threat for the companies that will restrain the
business expansion. There is more complicated tax procedure for the
companies, which are interested to increase the investment in their
businesses. A tax department also asks the company from where it receives
the money and where this money will spend. Due to fear of heavy taxes
companies would not like to invest the heavy amount.

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@

There are few people who have big investments and they are importing the
Chinese product by their own Brand name. This is a very big threat for the
company and company is trying to create some attraction for the investors to
demotivate the investors.