FAN INDUSTRY!

1
by

SANA SHAIKH
AISHA SALAUDDIN 2
 INTRODUCTION
 Fan is a daily use item.

 Its utility increases, especially in the summer

season.

 The industry is producing about 5 to 6

million fans per annum and meeting
successfully the local as well as the export
demand.
3
 (CONT)
TOTAL PRODUCTION DISTRIBUTION
 30 percent fans consist of pedestals
 7 percent brackets
 63 percent ceiling fans
 The industry existed at the time of
independence.
 In early 1950s, it was declared as cottage
industry.

4
 (CONT)
 Fan industry is mainly confined to
Gujranwala and Gujrat cities of the
Punjab province.
 The industry is producing a variety of
products in different sizes and designs.
 The industry supplies quality products to
the local markets.

5
 HISTORY!
 1940’s
heroic efforts made by a few enterprising individuals.

 When we go through the history of fan manufacturing industry a

reality comes in our view, that Sheikh and Mughal families
which dwell in Gujrat-Gujranwala, have played a very
significant role in the progress of this industry.

6
 (CONT)
 In this region the history of fan manufacturing is
not very ancient, however, since last five decades;
work has been done for its prosperity.

 1939 establishment of NATIONAL METAL

WORKS in Gujrat.

7
 (CONT)
 The industry belongs to the light engineering
industry category and it is one of the industries
that existed the time of independence

In early 1950s it was declare as cottage

industry and its more than 50%units are still fall
in the category
8
WHY IT IS CALLED COTTAGE
INDUSTRY?

9
 REASONS
 It is because majority of the units does not
have full facilities of production under one
roof.
 Most of the units are simply assembling
units; therefore do not gives brand names
to their products.

10
 RAW MATERIALS

 Electric steel sheets

 Aluminium
 Enameled copper wire
 Ball bearing
 Steel rod
 PVC.
11
 PRODUCTS
 Ceiling fans
 Pedestal fans
 Table fans
 Table-cum-pedestal fans
 Circumatic fans
 Wall bracket fans
 Exhaust fans
 Propellers.

12
Facts and Figures
GDP contribution Rs 1.5 billion

Total capital Investment Rs 3-3.5 billion

Installed capacity 5-6 Million fans per year

Total fan Production 2.5-3 million fans per year

Volume of exports $4 Million

Employment 25,000 Workers.

13
MAJOR FAN PRODUCING
COUNTRIES:
 Japan
 Korea
 Taiwan
 Hong Kong
 India
 China
14
PRESENT SCENARIO
 It does not owe its success to any foreign collaboration or any
from the Government, but to its own people whose constant
research for maintaining good quality and devising new methods
and techniques of production have now resulted in a product
which we can rightfully claim as among the best in the world.

 Pakistan has a comparative advantage in the production cost of

fancy fans. The per unit cost of these fans is 64$ in the USA, $40
in India while it is only $16 in Pakistan, which is the second
lowest, after Hong Kong.

15
 EXPORTS
 In 1992-93, only two-lacs fans were exported to only two
countries, Iraq and Yemen. But now the industry is
exporting fans to more than 25 countries

 Until 1998 about 84 % export of fans was restricted to a

few countries such as Saudi Arabia, Bangladesh and etc,
which has now increased to more than 50 countries
including EU and USA. No doubt the export of fans'
exports have great potential, their export is negligible

16
 (CONT)

 The government hasn’t given any

incentive to encourage fan export and
the progress is due to the efforts of its
manufacture and laborers only

17
 Year Ceiling Pedestal
 The figures given in table-I
1989-90 134 1,289
indicate that although the
exports of ceiling fan 1992-93 81,762 1,826
increased from Rs134
thousand to 209 million 1993-94 18,63615,137
rupees, the trade is 1998-99 2,552 32,432
fluctuating a great deal.
1999-00 15,689 66,370
2000-01 59,259 161,554
2001-02 208,963 183,613
18
 IMPORTS
 IMPORT OF BALL BEARING :The only ball bearing
manafacturing unit is lying closed , therefore , import duty on
ball bearing should be rationalized.

 Credit goes to GFC fan, prominent fan manufacturing

company, who made an appreciable attempt to supply
samples to the consumers in South America and West
Indies, which have been found consistent with electrical
standards of these countries

19
 (CONT)
 Production of voltage of 220/110 capacities
has also been on the rise, which was the
requirements of the countries

 Bangladesh is one of the major trade partners

in importing millions of fans from Gujarat.

20
 DEMAND and SUPPLY
 The actual production has remained about 2.5 million fans per
annum, showing a 50 per cent idle capacity

 About 400 units have a production capacity of 5 to 6 million

fans, on single shift basis.

 The demand for fans is continuously increasing due to increase

in population and speedy migration towards big cities.

 As people are becoming quality conscious so there is a tough

competition.

21
AVERAGE PRICES OF FAN
NAME OF Average Price (Rs):
PRODUCT
Ahad Fans 1975

Pak Fans 1470

Royal Fans 1563

Younas Fans 1512

Parvaz fans 1391

GFC Fans 1282

Super Asia fans 1345

Average Price 1584 22

 CLASSIFICATION OF GLOBAL
FAN TRADE
It is based on energy consumption. The fans that:

 Consume less than 125 watts of energy (SITC 74341) are

generally referred to as Domestic

 Fans and the fans that that consume over 125 watts (SITC
74343) are classified as Industrial

23
(CONT)
Pakistan has earned $ 3.896 mn. From
exports of domestic fans whereas it has
earned $0.104 mn.from exports of
industrial fans

24
 GST and Duty Structures

 GST on Fans 15%

 Import Duty on Fans 25%

25
 FUTURE PROJECTIONS
 Export of fans touched double figures in 2001-02
and the exports are targeted at $20mn because of
duty free access products provided by the European
union.

 Fans according to engineering vision the target of

fan industry would be to capture 10%of US & EU
markets by the year 2012.

26
 (CONT)
• Its efficiency and freezing the sale price at
present level, both for domestic and
international markets.

 The production target has also fixed at

11.3mn. Fans per annum in 2012. Out of
which 6.4 mn. Fans would be exported.

27
(CONT)
• Whatever progress the industry made, it has made
on its own resources, and is due to its dedicated
and hard working manufacturers and laborers. In
spite of the lack of proper training the industry has
innovated and uplifted the standard to the level
where its products can compete in the world
markets as government provided no incentives.

28
 PROBLEMS
 Ball bearing is an important part that ensures smooth
running and noiseless working of an electric fan.

 Like ball bearings , electric steel sheet (ESS) is also a

major item in fan manafacturing. It deteremines the
quality , performance ,durability and electricity
consumption of a fan .Due to ESS shortage and high
prices , fan manafacturers are using Mild Steel Sheet
(MSS) The motors manafactured from this material are
not of good quality and use more electricity.

 Lack of political framework: (no recognition at policy

level).
29
 (CONT)
 Lack of ownership & commitment of agencies involved; took
almost 2 years to inculcate vision of this change mgmt exercise

 Resource mobilization was the major issue to get short-term

wins.

 Lack of articulation culture and empire building attitude at all

levels.

 Too much high prices of import raw materials.

30
 RECOMMENDATIONS
 If the government really wants to increase exports of fan,
custom duties on raw materials should be lowered to a
reasonable level.

 Pakistan Standard Institute's procedure (PSI) should be

simplified and the latest technical laboratory should be set-up to
test the fans.

 An institute for labour training should immediately be

established with the help of PEFMA.

31
 (CONT)
 Fan industry has been a neglected one by the government
while it should be fully recognized like any other export-
oriented industry of Pakistan.

 An urgent need in big companies to establish research

departments within their factory premises for innovation and
to improve designs of fans according to the requirements of
international buyers.

 Government should rationalize custom duties on fan raw

material i.e., it should be lowered to a reasonable level.

32
 (CONT)
 Government should sponsor exclusive delegations of
the industry for visit to African countries, Indian
occasion including Australia, Indonesia and
Philippine, South America and Caribbean island
countries.

 HR development training awareness on ISO 9000

quality manufacturing standards needs to be
patronized to overcome the lack of facilities.

33
 (CONT)

 Ministry of science and technology with cluster

council project and FDI to provide technical
extensive facilities for the local industries
community.

 Director training, export promotion bureau

should established his camp office in Gujrat.

34
 WTO IMPACT!
 WTO will have a positive impact in Pakistan because it will
remove trade barriers which this industry faces a lot.

 Japan the major competitor , after the implementation of

WTO it is likely that Japan will move towards heavy
industry and Pakistan will get a chance to explore more and
it will enhance exporting of fans as well.

35
(CONT)
 WTO will have negative impact if it does
not improve its quality of labour and
does not implementation new
technology.

 As the splits and ACs are being

purchased by peoples who can afford it.

36
 CONCLUSION
 It has great potential but needs consideration by
government.

 The recommendations should be implemented.

 The problem should be solved.

 PSI should be provided incentives and encouraged.

37
THE END
38
QUESTIONS ARE APPRECIATED!

39