WAREHOUSING OF PEL

Presented By:
• MUJTABA AMIR KHAN
• UMAIR MISKIN
• JUNAID SHAH
• HAROON TARIQ
• ZEESHAN AHMED
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PEL-Pak Elektron Limited

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Vision& Mission

Vision
To excel in providing engineering
goods and services through
continuous improvement.
Mission
To provide quality products and
services to the complete satisfaction
of our customers and maximize
returns for all stakeholder.
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PEL Group Divisions

WAREHOUSE OF PEL (NORTH REGION)

■ Warehouse of this region caters the north area of Pakistan

■ Inventory was around 8000 finished units which worth around Rs 500 Million
■ Oracle based inventory system is currently being used by PEL
SWOT ANALYSIS

Strengths:
■ Strong dealer network
■ Strong quality, sale and service
■ Number 2 in refrigerators in Pakistan
■ Strong grip in home appliances
■ Strong Management
■ Strong research and development department
■ Free customer service
SWOT ANALYSIS CONT…..

Weakness:
■ Lack of effective advertisement
■ Lack of Product range
■ Less Utilization of capacity
■ Financial Problems
Opportunities:
■ Increase in product range
■ Export opportunity
■ Increase in production capacity
SWOT ANALYSIS CONT…

Threats:
■ Strong competition
■ China’s product introduction in the market
■ Slow growth rate in Pakistan
■ Instability of government
■ Tax department
PORTER FIVE FORCES MODEL
PEST ANALYSIS

1. POLITICAL ENVIRONMENT
■ Pakistan is one of the most vulnerable countries in the world
■ Very few incentives to manufacturer by the government.
■ The government also increased the minimum wage rate.
2. Economic Environment
■ Economy is facing financial crisis.
■ Strong black economy in Pakistan.
■ Unemployment rate has increased from 5.6% to 7.4%.
■ A negative 3.3% growth rate in manufacturing.
■ PCI has increased from $1042 to $106.
PEST ANALYSIS CONT…

3 Social Environment
■ In Pakistan air conditioners are used by upper and middle class.
■ People are more price conscious now a days due to financial crisis.
■ Customers have started considering split air conditioners as a status symbol.
■ More demand of split AC due energy saving.
4. Technological Environment
■ Technology is rapidly changing.
■ Companies are in competition to introduce latest technology in its products.
■ The use of CFC gasses has abolished in refrigerant products.
 ISSUES IN
WAREHOUSE OF PEL
LACK OF PROPER MACHINERY

■ The first issue is the lack of machinery such as fork lifters and cranes have caused
the company to use human force as a substitute for lifting of heavy items.
■ We believe that the use of machinery can have a hefty cost in the beginning but the
shortage of lead time is a far better deal not to pass. That is why it will be a
favourable action if proper machinery is to be used inside the warehouses of PEL.
PEL IMPORTS

■ Freight Cost (FOB & Ex-works)

■ Should use appropriate Inco-term to transfer the risk and coverage of insurance.
ONLY ONE WAREHOUSE IN THE NORTH
REGION
■ PEL had 4 warehouses before to cater the north region areas of Pakistan.

■ Now due to a cost cutting tactic they decided to put one giant warehouse that has
raised some issues which include that all focus has been shun towards one
warehouse.
IT RELATED ISSUES

■ Another grave threat is that of IT which mainly includes Internet connectivity. The lag
in internet can cause delays in order processing and delivery lead times.
ISSUES & RECOMMENDATIONS
ISSUES
■ Lack of Inventory Handling
Machines.
■ Freight Cost (FOB & Ex-works)
■ PEL have only one warehouses the
area of Rawalpindi and Islamabad.
■ Security Threat.
■ Pilferage & fire Incident (If Occur)
■ IT which mainly includes Internet
connectivity
RECOMENDATIONS
■ Introduce Fork Lifter and other
inventory handling machines.
■ Should use appropriate inco-term to
transfer the risk and coverage of
insurance.
■ Should have sub-warehouses.
■ Surveillance cameras and other
preventive measures.
■ Introduce proper hazerd preventive
equipment.
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RECOMMENDED MODEL

■ Vendor Managed Inventory to reduce Lead time and improve efficiency.

■ Multi echelon model should be adopted to optimize the inventory levels.
■ Multi warehouses can reduce the inventory levels along with minimization of holding
cost.
■ Integrated ERP system (SAP)should be introduced among the warehouses, so that
track on inventory levels will result in data accuracy and inventory optimization.
■ Lead time towards customer will be reduced due to more warehouses in the region.
■ Due to strong ERP system, the demand information will get stable.
■ Coordination among the warehouse members will get efficient.
MULTI-ECHELON MODEL
Thank You!