Marketing Theory & Practice (561)

Assignment 2
(Physical Distribution)
Name: Asifa Nazir
Roll Number: 583956
Submitted to: Mr. Tariq Asmat

Allama Iqbal Open University Islamabad

(Department of Business Administration)

Acknowledgment

First of all, I am thankful of Almighty Allah whose grace alone brings success and
accomplishment.

I am very thankful to Miss Asma, head of the department (HRM), Packages Ltd and Mr.
Ahsan Feroz, head of CPD. She has been very cooperative throughout my assignment.

I am thankful to my tutor Mr. Tariq Asmat and Brig. (R) M. Zubair who always
encouraged me and gave me confidence to go and work with responsibility.

Asifa Nazir
Roll No. 583956

Introduction

As packages names indicates that it has packaging business. It is only organization in

Pakistan who has such large scale packaging business. Packages established in 1957
as a joint venture between Ali groups of Pakistan and Akerland & Rausing of Sweden
to convert paper and board into packing for consumer industry.

Over the year, the company continued to enhance its failure to meet the growing
demand of packing products, additional capital raised from sponsor international
finance corporation and from the public in 1965.

Packages commissioned its own paper mill in 1968 having production capacity of
24,000 tones of paper and paper board on waste paper and agriculture by products
i.e. wheat straw and river grass. With growing demand the capacity was increased
periodically and 1996 reached 6500 tones per year.

Since 1982 packages limited has venture with tetra pack international. Tetra Pak
limited to manufacture paper of liquid food of packing and to market Tetra packing
equipment. Packages limited own 62% of this company. In 1999-2000 packages has
successfully completed the expansion of the flexile packaging by installation of new
rotofiavure printing machine. Printing and cutting machine are in production since
December 1999.
Packages has no big competitors in market.

Mission Statement

To be lead in market we serve by providing quality products and superior services

to our customers while learning from their feedback to set even higher standard for
products.

To be a company that continuously enhances its superior technologies competeness

to provide innovation solutions to customer needs.

To be a company that attracts and retains outstanding people by creating culture

and fastness openers and innovation promotes individual growths and reward
initiative and performance.

To be a company this combines its people and technology management system and
market opportunities to achieve portfolio while providing fair returns to its
investors.

To be that endorses to set the highest standard in corporate ethics in serving the
society.

Introduction to the Topic

Physical Distribution
Physical distribution and logistic effectiveness has a major impact on both customer
satisfaction and company cost. Effective physical distribution is beginning to key to
winning and keeping customers. This system is the most costly system of
organization.
Physical distribution involves planning, implementing and controlling the physical
flow of materials, final goods and related information from points of origin to points
of consumption to meet customer requirements at a profit.

Review of Literature
Logistic Principles:
The major logistic principles include: information system, Material handling and
packaging, storage facilities and transportation.

Information System:
An information system is needed to assure that proper inventory levels are
maintained at all stages of the system. This includes a communications and order
processing system to facilitate integration of all components and provide facilities for
controlling the entire distribution system.

Material Handling and Packaging:

These components involve considerable capital and also directly affect all other
element of the system.

Storage Facilities:
Particular attention should be paid to the design of storage facilities (both internal
and external) in order to ensure proper handling and to reduce the cost of moving goods
into and out of the inventory holding points.

Transportation:
Principle consideration for judgments in relation to this component is speed,
reliability, performance and cost.

Strategies of Physical Distribution:

There are two major strategies of Physical distribution i.e. Pull Strategy and Push
Strategy which are illustrated as follows.

Push Strategy:

In Push Strategy the flow of demand is from producer towards

consumer.

Pull Strategy:

In Pull Strategy the flow of demand is backwards from push strategy.

Data Collection & Analysis

CPD (Consumer Product Division)
Packages Ltd., CPD deals with the three brands of consumer product. The success
and failure of the brands depend on the marketing activities. Consumer product
division deals with the different marketing activities for each product. Following are
the items dealt by CPD

Standard Items:
Rose Petal:
R.P Luxury
o Pink
o Blue
o White
o Peach
R.P Multicolor
R.P Perfume
o 111
o 222
o 333
R.P Supreme
o Pink
o Blue
o White
o Peach
R.P Classic Perfumed
o Black
o Regular
o Multicolor
Pop up Table Napkins
o Black
o Purple
o Blue
o Green

 White Table Napkins

Colored Table Napkins
o Pink
o Blue
o Yellow
o Peach
Paper Towel
R.P Pocket Pack
o Pink
o White
Fresh Wipes 10S CTNo Pink
o Blue
o Jar Packing
Multicolor facial tissue
2Ply UN PRTD Embossed T.N
o Pink
o Blue
2 Ply PRTD T.N WHITE STD
Party Pack 500 sheets
R.P Toilet Roll
o Pink
o Blue
o White
o Peach
R.P Twin Toilet Roll
Double Hourse Toilet Rolls
Feminex
o Stickon Large
o Stickon Small
o Loops Large
o Loops Small
Full Paper Plates
Medium Paper Plates
Snack Paper Plates

 Snack Bowls
Paper Cups
o 80 CC
o 125 CC
o 160 CC
o 200 CC FLEXO
o 200 CC OFFSET
o 200 CC HOT
o 250 CC
o 300 CC
Un-Wrapped Toilet Rolls
Jumbo Towel Rolls
Jumbo Towel Dispenser
Institutional Pack
Rose Petal Coaster
Un-Printed Gum Tape
o 25 mm x 120 m
o 50 mm x 120 m
o 65 mm x 120 m
USCP (Utility Store)
Multifacial Tissues
Luxury Size
o Pink
o Blue
o Yellow
o White
o Peach
Supreme Size
o Pink
o Blue
o Yellow
o White
o Peach
Rose Petal Toilet Roll
o Pink

o Blue
o Yellow
o White
o Peach
White Table Napkin
Perfume
o 111
o 222
o 333
Colored Table Napkin
o Pink
o Blue
o Yellow
o White
o Peach
Utility Pack

Hotels to Serve:

1 PLY C.N for Lahore Gymkhana

1 PLY C.N for Macburger
125 CC STD CUPS OFFSET
160 CC STD FLEXO FOR SCOOP
160 CC STD FLEXO
2 PLY C.N for 1 PATATO 2 PATATO
2 PLY C.N for AVARI
2 PLY C.N for COPPER KETTLE LHR
2 PLY C.N for DAEWOO BREAD & BUTTER
2 PLY C.N for HOLIDAY INN LHR
2 PLY C.N for IGLOO ICECREAM
2 PLY C.N for KFC LHR/KHI
2 PLY C.N for P.C
2 PLY C.N for SALT & PEPPER
2 PLY C.N for SERENE HOTEL
2 PLY C.N for WHITE STD
2 PLY C.N for BELL PEPPER
2 PLY C.N for DUNKIN DONUTS LHR/KHI

2 PLY C.N for AERO ASIA

2 PLY C.N for 4 SEASONS
2 PLY C.N for BASANT
2 PLY C.N for BUNDO KHAN
2 PLY C.N for CATERERS
2 PLY C.N for FREDDYS CAF
2 PLY C.N for MARRIOT
2 PLY C.N for McDONALDS
2 PLY C.N for PIZZA HUT
2 PLY C.N for VILLAGE
2 PLY C.N for SERENA HOTEL WITH PRTG S
2 PLY C.N for SUN FORT
2 PLY UN-PRTD COFFEE NAPKINS
2 PLY UN-PRTD EMB T.N WIHTE (SPL)
2 PLY UN-PRTD T.N PINK
2 PLY UN-PRTD T.N
200 CC STD CUPS HOT
200 CC STD CUPS OFFSET
200 CC COLD CUP OP FOR MCDONANLD LHR/KHI
200 CC COLD CUP OP PUNJAB ICECREAM
200 CC STD CUP LUX PINK/GREEN W/O LOGO
300 CC STD CUPS OFFSET
4 PLY CST FOR SERENA FAISALABAD
80CC P/CUP ALPINO
80 CC P/CUP SMILE
80 CC P/CUP DARK BLUE GROUND
CCL SPL PR WET TISSUE FOR LEVOCIL
DOCTOR TISSUE ROLL
INST. PACK MAROON COL FOR AKH
INSITUTIONAL PACK GREY
MCDONALDS CHICK ROLL WRAPPERS
MCDONALDS PINEAPPLE PIE CARTONS
OFFSET -12 OZ 30CC KFC PEPSI CUPS
OFFSET -16 OZ 50CC KFC PEPSI CUPS W. 16 OZ.
PRTD PLATES FOR SAVOUR FOOD RED,GREEN

Tulip:

PRTD. PLATES FOR SAVOUR FOOD YELLLOW

SPL PR WER FOR BAR-B-Q
STDWET TISSUE 10S CTN
STDWET TISSUE 10S CGN
STDWET TISSUE JAR PACKING
UN-WRPD T.R FOR INST.
UN-WRPD FOR PC
PAPER TOWEL CAA
PIA TOILET ROLL WRAPPED WITH PIA LOGO
SUPREME FACIAL CAA
UN-WRAP FOR CAA

Tulip 100
o Pink
o Blue
o White
o Peach
Tulip Multicolor
Tulip 100 viva perfumed
Tulip pocket pack pink
Tulip single toilet rolls
Tulip twin toilet roll
o Pink
o Blue
o White
o Peach
Tulip Facial 100s
o Pink
o Blue
o White
o Peach

Practical Study of the Organization

Packages Ltd. have a big distribution system. After study of the market activity,
where customers, potential customers are located what they buy and what
volumes they buy. The answer will differ because of local desires and facilities
and beliefs.
Packages have their own distribution network. They have 116 distributions all
over the Pakistan.

Producer

Distributor

Retailer

Consumer

Packages Ltd. Distribution Strategy:

Packages have their distribution strategy. Distribution strategy is conventional one
i.e. Manufacture, distributor, wholesaler and retailer. Distributors supply directly to
the retailer. Company prefer distributor to the retailer. Percentage of sales through
wholesaler varies from town to town and ranger to 25% to 40%. The primary focus
of this strategy is:
Maximize brand availability at all target retail and wholesale outlets.
Regular order booking and market visits by distributors and field supervisors.

 Complete distribution coverage at Non-traditional sales channel- these

includes Hospital, Pharmacies, Mother care shops, cosmetic shops, ad
exclusive ladies stores and slimming parlors.
Separate distribution vans for different products.

Information System:
CPD proper maintained their inventory level. This includes a communication and
order processing system. The information system controls the distribution system.
The information system control operations such as production, shipping, stock
ordering and cost accounting information.

Handling & Packaging Material:

The handling and packaging of materials effect the physical distribution. CPD gives
the proper protection easily handling the boarding and transport with available
facilities.

Storage:
For proper integration into the physical distribution system CPD has storage
facilities and it perform functions efficiently in the processing activities of
warehousing.

Transportation:
The choice of transportation carries affects the pricing of products, delivery
performance and condition of the good when they arrive, all of which effect
customer satisfaction.
Packages transport their products by trucks. The tuck brought a good mobility to
goods.

SWOT Analysis of Packages Ltd.

Strengths:
The CPD producing all types of paper and board packing.
They are having the best positive image and reputation for quality packing in
Pakistan.
Own research, development and control department.
They are having their own generation plant.
Distribution Channels are strong.
Transportation system for easy handling of products.
Strong Advertisement of products.
Proper protection and storage of products.
Have own warehouses.

Weakness:

They cannot take small orders.

In small towns they dont have a proper distribution channel.
Late decision making.
Excessive Weight per unit.

Opportunities:
Market of packaging industry is growing day by day.
Strong advertisements attract the customers.
Distribution Channels are strong.

Threats:
High costs of products.
Tough competition will be faced in near future.

Recommendations & Conclusion:

Packages Ltd. is one of the major companies of Pakistan making packaging

goods as well as household items, having no major competition in the
country. But as far as distribution system is concerned, although in main
cities it is easily competing the bigger imported brands but in smaller cities of
Pakistan some small brands are more utilitized than of the products of
Packages ltd. the company should therefore not only increase the awareness
of the quality among the people but also to ensure the availability at those
places.