INTRODUCTION

Packaging Limited was born out of a dream to set up in Pakistan industries of excellence based on local raw material and talent. Packages Limited is a leading packaging manufacturing company of Pakistan. It is the sole largest industry in Pakistan serving about 35% needs of the country. Syed Baber Ali Shah, who was the first managing director of Packages Limited went to Sweden in 1954 to negotiate the contract with AB Akerland & Rausing of Sweden. AB Akerland and Rausing had been the leading paper converters in Europe. Pakistanis needed technical collaboration with their Swedish partners. In the beginning, the first problem was the selection of the site. Finally, Lahore was selected due to the following reasons:

· Easy availability of workers.

· Easy availability of raw material.

· Easy transportation all over the country.

A B Akerlund & Rausing packaging company brought machinery and expert technicians while the Ali Family provided the necessary capital, land, labor, local expertise and management. Syed Baber Ali was the first Managing Director.

Packages Limited started operating in May 1957 with a paid up capital of Rs. 4.94 million as a joint venture between the Ali group and Akerland & Rausing of Sweden. Initially, Packages produced cartons for the cigarette, tea, confectionery, soap, pharmaceutical products and other consumer products. These cartons were produced from paper and board supplied from mills in Chittacong, Khulna, Charsadda and Peshawar. However the quality and quantity of paper and board supplied was inadequate. Over the years, the company continued to enhance its facilities to meet the growing demand of packaging products. Additional capital was raised from sponsors, International Finance Corporation and from the public in making the total paid up capital to Rs. 31 million in 1965.

As a first step, Packages commissioned its own paper mill in 1968 having production capacity of 24,000 tons of paper & paper board based on waste paper, agricultural waste, wheat straw and kahi grass. As the demand continued to grow, it led the company to expand and by the end of 1998 its annual capacity was increased to 50,000 tons of paper & board and corresponding converting ability.

Since 1982, Packages Limited has a joint venture in Tetra Pak Pakistan Limited with Tetra Pak International to manufacture paper for liquid food packaging and to sell Tetra Pak packaging equipment. After Tetra shape, it also introduced brick shape packing. Both shapes are very popular among liquid preservation industries. The main industries covered by Packages Limited are, Tea Industry, Tobacco Industry, Food Industry, Pharmaceutical Industry, Sweets & Confectioneries, Soap Industry, Shoe Industry, Tissue Industry…

In tetra Pak Pakistan Limited Packages Limited has 45% shares, 6% shares owned by Syed Baber Ali Shah and 49% shares owned by Tetra Pak International.

Since 1957, Packages has been producing inks for its own consumption. In 1993, the company agreed to form a joint venture with equity participation from Coates Lorilleux, world’s second largest printing ink manufacturer to produce inks for Packages Limited and the general market. Packages Limited own ink manufacturing facilities now transferred to new company, “ Coates Lorilleux Pakistan Limited”. In July 1994, Coates Lorilleux Pakistan Limited; in which Packages limited has 55% ownership, commenced production and sale of printing inks.

Also in 1993, a joint venture agreement was signed with “Mitsubishi Corporation of Japan” for the manufacturing of polypropylene films at the industrial estate in Hattar, NWFP. This project, Tri-Pack Films Limited, commenced production in June 1995 with equity participation by Packages Limited33%, Mitsubishi Corporation, Altawfeek Company for Investment funds, Saudi Arabia and general Public.

Another important service department of Packages Limited is its “Power Plant”. In 1967they set up 6 MW power plant, but to ensure a continuous and dependable supply of power for its production lines, Packages has also established its own 10 MW power plant in 1991, the cost of which was 180 million rupees. Packages Limited save a lot of money in this regard. For example, if they get power from WAPDA, thenWAPDA charge more than 6 rupees per unit but the expenses of its own production are almost 2 rupees per unit.

In the field of consumer products, Packages Limited has shown tremendous potential and commendable talent. Consumer Product Division provides 12% share of the Packages total sales. The consumer products of the company are “Rose Petal Tissues”. The production of Rose Petal was first introduction of tissue paper industry in Pakistan. Though Packages has introduced so many brands of tissue. Rose Petal is now the market leader of tissue paper industry in Pakistan. Rose Petal has more than 80% share of tissue paper industry in Pakistan. Other consumer products are paper Cups, paper Plates, Paper Napkins, Paper Hot Cups and Wet tissues of Rose Petal have been introduced in the market in 1992.

Now Packages Limited is exporting its managerial skills & technical expertise to the third world countries like Indonesia, Tanzania, Kuwait, Saudi Arabia, Nigeria, Zambia, Somalia & Russia. It has also started the export of tissues to Iran, Bangladesh, Sri Lanka, Indonesia, United Arab Emirates and Maldives.

Packages Limited has a large workshop. This workshop is capable of making, repairing and replacing the damaged parts. The RD & Control Department were also established to ensure the quality and standard of the products.

Starting with a work force of 500 workers, now Packages Limited is having 2674 employees. In this regard, a separate Personnel Department is there, to look after the problems of the workers. Today Packages Limited is considered to be a leader in Packaging field in Asia.

Packages Limited has established an Effluent Treatment Plant because it is concerned about the environment and wants to keep it clean.

Packages have completed the balancing, modernization, replacement and expansion program, which began in 1994. This has enabled the company to minimize capacity constraints and improve quality to meet local and foreign competition as well as improve its environmental protection facilities.

DEFINITION OF PAPER AND BOARD:

When the weight of one square meter of sheet exceeds 130 grams, it is termed as Board or Paper Board. Substance lower than 130 grams per square meter is called Paper.

Board is basically used in the manufacture of cartons where creasing is also required. It provides necessary strength to the cartons, which are most commonly used in packaging of cigarettes, toiletries and detergents, tea pharmaceutical products, food and other consumer items.

DEFINITION OF PACKINGING

Packaging is the use of containers and components with the addition of labeling to protect, identify, merchandise and facilitate the use of products. Protection and identification being the overwhelming factors in this process. This obviously facilitates the use of a product of a particular brand.

ORGANIZATION CHART OF

PACKAGES LIMITED

COMPANY SECRETARY

ADIJ CAWASJI

AUDITORS

A.F.FERGUSON & CO.

CHARTERED ACCOUNTANTS

LEGAL ADVISORS

HASSAN & HASSAN- Lahore

ORR, DIGNAM & CO.-Karachi

BANKERS

ABN AMRO BANK

AMERICAN EXPRESS BANK LIMITED

ANZ GRINDLAYS BANK LIMITED

BANK OF AMERICA, N.T & S.A

CITI BANK N.A.

DEUTSCHE BANK A.G.

EMIRATES BANK INTERNATIONAL P.J.S.C

HABIB BANK LIMITED

MUSLIM COMMERCIAL BANK LIMITED

STANDARD CHARTERED BANK

THE HONGKONG & SHANGHAI

BANKING CORPORATION LIMITED

HEAD OFFICE & WORKS

Shahrah-e-Roomi

P.O Amer Sidhu

Lahore-54760

Pakistan

PABX : 5811541-46, 5811191-94

Cable : PACKAGES LAHORE

Telex : 44866 PKGS PK

Fax : (042)5811195, 5820147)

REGISTERED OFFICE

&REGIONAL SALES OFFICE

1^ST Floor, Hilal-e-Ahmer House

Khayaban-e-Iqbal

Main Clifton Road

Karachi-75600

Pakistan

PABX : 5863941-42, 5874047-49

Cable : PACKAGES KARACHI

Telex : 20315 PKGS PK

Fax : (021) 5860251

REGIONAL SALES OFFICE

1^ST Floor, Yasin Plaza

74 West Blue Area

Islamabad –44000

Pakistan

Paktel : (0351) 7370694

PABX: 276765, 276768

Fax : (051) 829411

ZONAL SALES OFFICE

1^ST Floor, 61 Khan Plaza

Qasim Road

Multan Cantt,

Pakistan

Tel : 587370

OBJECTIVES OF PACKAGES LIMITED

Objectives, are the ends towards which activity is aimed. They represent not only the end point of planning but also the end toward which organizing , staffing , leading and controlling are aimed. Packages Limited work’s with the objective of increase in sales, profit and expansion programs. At the time of establishment the Packages Limited start to work with the objective,

“To secure a relatively safe and cheap local source of paper, board and plastic film packaging”

The objectives for which the company is established are:

1. To carry on all or any of the business of manufacturing and printing of cartons, packages, specialized containers for various commodities, utensils and other articles, printers, lithographers, type founders, stereotypes, electrotypes, photographic printers, photo-lithographers, chromelithographers, engravers, die sikers, book binders, designers, paper and ink manfacturer and dealers in or manufacturers of any of them articles or things of a character similar or analogous to the foregoing or any of them or connected therewith; manufacturers importers, exporters, and dealers in raw materials articles and things required for purpose of manufacture and printing of cartons, packages, specialized containers for various commodities, utensils and other marketable commodities and to establish and maintain showrooms for this purpose; and of distributors, suppliers and sellers of the said articles and contractors for supplying them.

2. To carry on all or any of the business of manufacturers of and dealers in paper and board of all kinds and Tetra Paper for making Tetra Pak of any type, description and dimensions, straw board, plain and corrugated duplex board, card board, box board, veneer board, mill board, wall and ceiling paper, grease proof paper and articles made of paper, pulp, paper board specialists and board in all their branches.

3. To carry on business as producers and processors of and dealers in poultry, dairy produce of all kinds and other liquids of every description and to carry on business as cow and buffalo keepers and as manufacturers of all kinds of condensed milk, cream, butter, cheese and other milk products.

4. To carry on the business of planters, growers, cultivators, farmers and dealers in corn, hay and straw and other produce of the soil likely to be used in the manufacturing of paper and to improve protect against fire and wind and other elements of nature and to treat, prepare, render marketable, buy, sell or dispose of otherwise such corn, hay and straw and other products.

5. To carry on the business of stationers, printers, publishers, fancy goods dealers, bill posters and advertising contractors.

6. To carry on the business of manufacturers of an d dealers in chemicals of all kind; paints, varnishes, printing inks and all other things which can be conveniently manufactured or dealt in either wholesale or retail and either as principals or agents.

7. To imports and exports, buy, sell and trade in manufacture and mill supplies, fire engines, trucks, vehicles, machine tools, machine shops, processes and electric supplies and appliances foundry and factory supplies and hardware of all kinds and chemical substances useful for the company.

8. To carry on any other business, whether manufacturing or otherwise, which may seem to the company capable of being conveniently carried on in connection with the above or calculated directly or indirectly to enhance the value of or render profitable to the company’s property or rights.

9. To acquire and undertake the whole or any part of the business, property and liabilities of any person or company on any business, which the company is, authorized to carry on, or possessed of property suitable for the purpose of this company.

10. To establish laboratories and research and development centers to perform such research and development as the company may deem advisable or feasible.

11. To train personnel and workers, both in Pakistan and abroad, to obtain technical proficiency in various specialties connected with the paper, board and packaging industries or other business of the company.

12. To carry for purchase or otherwise acquire any patents, brevets invention, licenses, concessions and like, conferring any exclusive or non-exclusive or limited right to use or any secret or other information as to any invention which may seem capable of being used for any of the purposes of the Company, or the acquisition of which may seem calculated directly or indirectly to respect of, or otherwise turn to account the property, rights or information so acquired.

13. To enter into the partnership or into any arrangement fir sharing profits, union of interest, cooperation, joint venture or reciprocal concessions, with any person or company carrying on, or engaged in any business or transaction which this company is authorized to carry on or engage in, or any business or transaction capable to benefit this company and to lend money, to guarantee the contracts of or otherwise assist any such person or company and to take or otherwise acquire shares and securities if any such company, and to sell, hold, reissue with or without guarantee, or otherwise deal with the same.

14. To take, or otherwise acquire, and hold shares in any other company having objects altogether or in part similar to those of this company, or carrying on any business capable of being conducted so as directly to benefit this company.

15. To enter into an arrangement with any government, state or authority, central or provincial, railway, municipal, local or otherwise, that seem conductive to the company’s objects or any of them and to obtain from any such government, state or authority any rights, privileges and concessions.

16. To establish and support or aid in the establishment and support of associations, funds, trusts, and conveniences calculated to benefit employees of the employees of the company or the dependents or connections of such persons, and to grant pensions and to make payments towards insurance.

17. To promote any company(ies) for the purpose of acquiring all or any of the property, rights and liabilities of this company, or for any purpose which may seem directly or indirectly to benefit this company.

18. To sell or dispose of the undertaking of the company or any part thereof or such consideration as the company think fit, and in particular for shares, debentures, or securities of any other company having objects altogether or in part similar to those of this company.

19. Generally to purchase, taken lease or in exchange hire or otherwise acquire, any moveable or immovable property and any rights or privileges which the company may think necessary or convenient for the purpose of its business and particular any land, building , machinery, plant and stock on trade.

20. To construct, improve, maintain, develop, work, manage, carryout, or control any manufacturing, warehouse, shops, stores and other works and convenience which may seem calculated directly or indirectly in advance the company’s interest.

21. To sell, improve, manage, develop, exchange enfranchise, mortgage, lease, dispose of account, or otherwise deal with, all or any part of the property and rights of the company.

22. To invest and deal with the money of the company not immediately required in such manner as may from time to time be determined.

23. To lend money to such persons or companies and on such terms as may seem expedient and in particular to customers and others having dealing with the company and to give dealing with the company and to give guarantee or become security for any such persons, firms or companies.

24. To borrow or raise or secure the payment of money in such manner as the company shall think fit, and in particular by the issue of debentures or debentures stock, perpetual or otherwise charged upon all or any of the company’s property, both present and future including its uncalled capital and to purchase or pay off any such securities.

25. To adopt such means of making known the products of the company as may seem expedient, and in particularly advertising in the press by circulars by purchase and exhibition of works of art or interest, by publication of books and periodicals and by granting prizes, rewards and donations.

26. To underwrite the shares, stocks or securities of any other company and to pay underwriting commission and brokerage or any shares, stocks or securities issued by the company.

27. To subscribe or contribute or otherwise to assist or to guarantee money to charitable, benevolent, religious, scientific, technical, national, public, political or any other institutions, objects or purpose or for any exhibition.

28. To receive money on deposit or loan upon such terms as the company may approve, and to guarantee the obligations and contracts of customers and others.

29. To remunerate the directors, officials and servants of the company or any person or firm or company rendering services to the company out of or in proportion to the returns of profits of the company or otherwise as the company may think proper, either by cash payment or by allotment to him or them of shares or securities of the company credited as paid up in full or part or otherwise as may be thought expedient.

30. To undertake and execute any trust, the undertaking where of may seem desirable, and either gratuitously or otherwise.

31. To capitalize such portion of the profits of the company as in not distributes among shareholders of the company in the form of dividends and as the directors of the company may think fit and to issue bonus shares, as fully paid up, in favor of the shareholders of the company.

32. To act as managing agents for any other person, firm or company as may be deemed convenient and upon such terms as may be agreed.

33. To do all such other things as are incidental or conducive to the attainment of the above objects.

34. To develop and build local skills and competence in a sophisticated industry in order to make the country self sufficient in its need for packaging.

MANAGERIAL POLICIES

The major managerial policies as adopted by Packages Limited are as follows:

1. The price of the Company’s products is same for all areas of Pakistan.

2. In case of consumer products, the company pays freight and octroi.

3. Prices can be changes by the company without any prior notice.

4. The Company accepts only large orders of high monetary value.

5. An order, which has once been confirmed by the customer, can only be canceled at the will of the company and not the customer.

6. In case of consumer product, agreement with customer is made once and for all.

7. No discounts are offered to the customers.

8. Goods are sold against 100% advance payment.

9. The company does not pay freight when its industrial products are shipped to the customer.

10. Punctuality is strongly emphasized.

11. All the designed and original work done in preparing the package of any product, will remain the property of the company.

12. Procurement is made directly from the producers so that the middleman’s profit is eliminated.

13. Once the goods are in transit, they become the property of the customer.

14. Customer can only claim for defective goods if they exceed 2% of the total order and the claim is made within two weeks after the delivery.

15. For routine purchases, multiple suppliers are maintained to reduce dependency on any one particular supplier.

16. A variation of 10% in the quantity of the order delivered is a norm variation and the customer has to accept the order as such and pay for the surplus.

17. Any alteration in the approved sample shall be charged extra.

18. Workers are encouraged to produce more through a well-organized incentive system.

19. Selection of executives is done strictly selected on merit and no approach is entertained in this regard.

20. Investment is made in those projects, outside the line of the company, which can later improve the sales of the company.

21. In all the production processes both quality and quantity are taken emphasized.

22. Workers are encouraged to reduce the wastes and costs.

23. Only those workers are recruited who have some relationship with the current employees of the company.

24. Smooth relationship between supervisors and the subordinates is emphasized.

25. Company makes capital investment equal to the depreciation every year.

26. Swiftness in the performance of duties is encouraged.

ACCOUNTING POLCIES

The following are Packages Limited major accounting policies:

1. ACCOUNTING CONVENTION: The accounts have been prepared under the historical cost convention, modified by capitalization of exchange differences referred to in note 2.8.

2. TAXATION: The charge for current taxation is based on taxable income at the current rates of taxation after taking into account tax credit and rebates realisable, if any. The company accounts for deferred taxation, using the liability method, on all major timing differences.

3. FIXED CAPITAL EXPENDITURE AND DEPRECIATION: Operating fixed assets except land is stated at cost less accumulated depreciation. Land and capital work-in-process ate stated at cost. The management carried out a comprehensive review of the useful lives of major items of plant and machinery in1985. Depreciation in respect of such assets is charged in annual installments so as to write off their yearend book value over their remaining re-estimated useful lives.

Depreciation on all other operating fixed assets is charged to profit on the straight line method so as write off the historical cost of an asset over its estimated useful life at the following annual rates:

Plant and Machinery	6.25%	to	20%
Buildings	2.5%	to	5%
Other equipment	10%	to	33.33%
Furniture and fixtures	10%	to	20%
Vehicles		to	20%

The full annual rate of depreciation is applied on the cost of additions, excluding exchange differences, while no depreciation is charged on assets deleted during the year.

The net exchange differences relating to an asset, at the end of each year, is amortized in equal installments over its remaining useful life. Major renewal and improvements are capitalized.

4. LONG TERM INVESTMENT: These are stated at lower of cost and market value determined on a portfolio basis. Provision is made for permanent diminution in the value of any investments.

5. STORES AND SPARES: Usable stores and spares are valued principally at moving average cost, while items considered obsolete are carried at nil value. Items in transit are valued at cost comprising invoice value plus other charges paid thereon.

6. STOCK-IN-TRADE: Stock of raw materials, except for those in transit, work-in-process and finished goods are valued principally at the lower of average cost and net realizable value. Cost of work-in-process and finished goods comprises cost of direct materials and labor and appropriate manufacturing overheads. Materials in transit are stated at cost comprising invoice values plus other charges paid thereon. Net realizable value signifies the estimated selling price in the ordinary course of business less costs necessarily to be incurred in order to make a sale.

7. FOREIGN CURRENCIES: All assets and liabilities in foreign currencies are translated at exchange rates prevailing at the balance sheet date except for foreign currency long-term loans covered under State Bank of Pakistan risk cover scheme. Exchange differences on loans utilized for the acquisition of plant and machinery are capitalized up to the date of commissioning of the assets. All other exchange differences are included in profit currently.

8. STAFF RETIREMENT BENEFITS:

A.) CONTRIBUTION PENSION FUND: This scheme administrated by the Board of Trustees, cover all the management staff. The scheme is funded and is approved by the Central Board of Revenue. Contributions by the company included in salaries, wages and immunities are based on actuarial valuation using the projected benefits valuation method. The most recent valuation took place during the year ended December 31, 1997, when the benefits for both past and future services were found to be fully funded. Contributions made by the company are charged to profit currently.

B.) GRATUITY FUND: This scheme administrated by the Board of Trustees, cover all the employees with qualifying service period of ten years. Contributions to the fund are payable on the basis of an actual valuation using the projected benefits valuation method. The most recent valuation took place during the year ended December 31, 1997, when the benefits for both past and future services were found to be fully funded. Contributions made by the company are charged to profit currently.

C.) There is an approved contributory provident fund for all employees.

Retirement benefits are payable to staff on completion of prescribed qualifying period of service under these schemes.

9. MARK UP, INTEREST, PROFIT AND OTHER CHARGES: Mark up, interest, profit and other charges on redeemable capital and long term liabilities are capitalized up to the date of commissioning of the respective plant and machinery, acquired out of the proceeds of such redeemable capital and long term liabilities. All other mark up, interest, profit and other charges are charged to income.

10. REVENUE RECOGNITION: Revenue is recognized on dispatch of goods or on the performance of services except for management fees which are recognized on receipt.

11. SECURITY OF FOREIGN CURENCY LOANS: Loans are secured by an equitable mortgage of immovable properties, hypothecation of all plant and machinery and a floating charge on all current assets subject to the hypothecation of stores, spares, stock-n-trade and debts in favor of the company’s bankers.

12. LONG TERM LOANS, DEPOSITS & REPAYMENTS: Loans to employees are secured by joint registration of scooter or motor cycles in the name of the employees and the company. The remaining loans are unsecured. No loans to employees outstanding for a period exceeding three years.

13. TRADE DEBTS: All debts are considered good and include secured debts of Rs.6.864 million (1997: Rs. 3.665 million). Trade debts include amounts due from associated companies Rs. 52.136 million (1997: Rs. 62.510 million) and the maximum aggregate amount outstanding against them at the end of any month during the year was Rs. 81.887 million (1997: Rs. 72.554 million).

PLANNING DEPARTMENT

PLANNING DEPARTMENT

As we know that if we want to increase our efficiency, we should plan with excellence. Planning department is one of the most important departments in an organization. Its main functions are to plan huge operations. In Packages the planning department is also playing an important role. The Planning Manager controls the department. The two main functions of the Planning Department are following:

1. LINK BETWEEN MARKETING DEPT. AND PRODUCTION DEPT.

The Planning department acts as a link between Marketing department and the production department as there is no direct contact between the two departments. Planning receives marketing information from the Marketing department and converts it into the Production language i.e. When the orders are placed to the marketing department, the information regarding the order is transferred to the planning department where they design and plan the product according to the specifications required by the customers.

2. OPTIMIZING THE AVAILABLE CAPACITY

To optimize the capacity means to utilize the manpower, machines working hours and material Educate ultimate objective of the Planning department is to improve and maximize the profitability. Yearly targets are set during the annual Sales Conference that is held in the month of December. In the sales conference the next five-year targets are set and the last years performance is reviewed. The next year’s projections are also set in the conference. In the five-year plans the shortfalls which are manpower, materials and machinery are reviewed. Top management is involved in long term planning short term plans which constitute a year are reviewed every quarter.

FUNCTIONS OF THE PLANNING DEPARTMENT

The work of planning department is initiated from the industrial marketing department. When the orders are placed to the marketing department, they send out the ISO. (Internal Sales Order) to the planning department. An ISO. is an internal document on which the information regarding the sales or order is mentioned. Its main function is to transfer the information to the various departments involved.

The contents of the ISO. provide the following information.

1. Whether it is a new job or old one.

2. Specifications of the routine order i.e. color, size and quantity etc.

If it is a new order then this order is first sent to the Art and Camera Department for designing the artwork of the new job. If the job is repeated then there is an approved sample by the customer. The planning department after receiving this ISO. along with the sample sends it to the production department.

PREPARATION OF LOADING CHART

For the optimum utilization of the machine time and personnel, loading chart are prepared by the planning department. These loading charts provide the information that when the job will be completed and will be ready for dispatches. It is mentioned in weeks and as week numbers i.e. total weeks 1 to 52. Time is spend on printing, cutting, folding, gluing and packing is calculated and the planning department informs the marketing department the exact time of completion and delivery for the respected order.

Planning department informs the customer through marketing department to check there stocks properly ignored to avoid any emergency because emergency orders increase the wastage. It can be because of non-availability of specific requirement of paper and board.

The planning department also provides information regarding production machines, their capacity, numbers of colors size etc. to marketing department. Information regarding any machine, which is out of order, is also provided to the marketing department, so that any orders related to that particular machine may not be expected. They also provide the information regarding the production capacity so that they are in a good position to analyze the order.

OTHER FUNCTIONS.

The other functions, which are carried out by the planning department, are as follows:

- Maintenance of machinery etc.

- To sent daily production reports to the top management.

- Over coming the complaints of the customers and marketing Department.

- To plan the long term and short term plans for minimizing loss.

- Pursuance of jobs i.e. the current condition of the job.

- To set the production targets for different departments on the basis of invoices.

- Procurement of raw materials.

- To organize the daily program i.e. completion of jobs from shift to shift.

PRODUCTION DEPARTMENT

PRODUCTION DEPARTMENT

The role of production department in a manufacturing concern is very important. In Packages the production department is also an important one. The goods for the customers are manufactured according to the desired standards in this department. This department is responsible to plan and organize the allocation of jobs to various machines in a way that their maximum capacity is utilized and that the delivery is given to the customer by stipulated date. The head of the production department is the production manager. The planning department also assists the department. The working procedures are based on week basis i.e. the total no of weeks in a year. The Production Manager looks after the production while the Planning Manager supervises the planning section. The heads of following departments are directly answerable to production manager and they have to present their special problems to him for advice and help:

¨ Paper Converting department

¨ Off-set Printing

¨ Coates Lorilleux (Ink Factory)

¨ Art Department

¨ Flexible Packaging Division

¨ Camera Department

¨ Coating Department

¨ Cutting & Creasing Department

¨ Lamination Department

¨ Folding & Gluing Department

¨ Dispatch Department

¨ Quality Control Department

The Production, Planning and control unit is also directly under the Production Manager and acts as the brain cell for him. Production Manager prepares internal planning of whole Paper & Board Division. It takes into account the total capacity of the machinery, and manpower. It also arranges the resources to attain maximum utilization. The other goal is to reduce the wastage of resources. The planning department acts as a coordinator between the Marketing and production Departments. This is very Important in the sense that if there is no communication between the Marketing and Production Departments, a lot of confusion will be created.

PRODUCTION PROCEDURE

The sale staff is in direct touches with the customers and solicits business. After the business has been finalized, an Internal Sales Order (ISO) is sent direct to the Production, Planning and Control Departments for checking and planning out the production schedule. The planning officer and his staff communicate and correspond directly with sales staff. Sales staff also deals with Art Department in the initial stages of the business negotiations for the approval for the customer. The direct link of the Art Department ceases after the customer has approved the comprehensive. For submitting proofs of the made job reference to the Planning Department for finalizing the ultimate shape of the product. They also prepare mechanical for the Offset and Flexographic jobs. The jobs then move to Camera department who prepare the printing negatives followed by production department who prepare the printing plates. The plates will either go to proofing press or for mass production to offset presses.

The order received by the customer to Marketing Department may be:

¨ New job

¨ Modify the old job

¨ Repeating job

In order to develop a new job, to create a new product or to give special suggestions to the customer, sales staff takes help from Development Manager. Development Manager is in touch with all the facilities available at the factory and develops the projects until it is fit for mass production. The new job is first sent to Art and Camera Departments for the art & design to be printed. In case of repeat order, the Production Department will receive the ISO with the sample and the job will be sent to the planning department.

Planning department issue a Job Card, as soon as the Job Card is made out, Paper & Board stores arrange material. The immediate requirements are indicated in the Job Card who has to be available in stocks while the long-range requirements are stocked up. Production Manager has to foresee the future requirements. In case of new development, special materials are to be ordered. When substantial orders are expected in a particular line then raw materials will have to be ordered. For example, if there is trend of packaging polyethylene bags then polyethylene granules will have to be bought ahead of time.

After Offset Department & Paper Conversion Department (PC) the job run through Cutting and Creasing, Folding and Gluing and is sent out through Dispatch Department. The jobs emanating from Paper Converting & Offset Department go directly to Dispatch Department. Once important function of the Dispatch Department is to prepare Dispatch Notes for goods sent out whether by trucks or railway.

Production department is further integrated into two divisions namely:

1. PACKAGING DIVISION.

2. PAPER AND BOARD MILL.

PACKAGING DIVISION

The packaging division is also called as the Paper Converting Division. Paper Converting Department was established in 1971. This department is second major department in Packages Limited. There are three types of printing in Packages Limited:

· Off-set Printing

· Flexo Graphic Printing

· Roto Gravure Printing

The Paper Converting Department converts the paper into packing material. By Flexo Graphic & Roto Gravure Printing we can get paper or bags in reel forms. It only uses paper and other Polly materials. No board is used in this department. Printing in the Paper Converting Department is several forms:

· Printing & Conversion of Paper

· Preparing & Printing Polyethylene bags

· Preparing Aluminum Foils

Fine printing is get from Roto Gravure printing, which is expensive, then Flexo method. The operations are carried out on various machines. Operations include printing polyethylene extrusion, cutting, creasing, slitting, bag making, waxing etc. The Paper Conversion Department has the following machines. This department split into three sections with the following equipment:

SECTION I

Two Tea Bag Machines

Two Bag Making Machines

Four Printing Machines

Two, Four Colors Machines

One, Six Colors Machines (Only For Polyethylene Bags)

One Roto Machine (Two Colors)

Three Rubber Stereo Making

SECTION II

Six Slitting Machines

One Embossing Machine

Two Laminating Machines

Four Packing Machines

SECTION III

Two Extruder

Two Polly Bag Machines

One Extruder Laminator Machine

One Gumming Machine

PROCEDURE:

Out of four Flexo Graphic machines, one is six color and the rest are four color-printing machines. Hence, in Flexo graphic printing, Packages Limited has the facility to print from two to six colors. In July 1994 they break 1991 record and produce 4455000 meter printed packaging reels. There are six slitting machines, which are used for several kinds of slitting. In Flexo Graphic printing water based ink is used. The machine gets ink for one side and print it on the other side. There are two polyethylene extruders, which manufacture Polyethylene both at low and high density Polyethylene from granules, which are mostly imported from the U.S.A, Qatar, U.A.E.

All printing machines are imported from Sweden and Germany. The management and operators believe that German machines are very good and their production is also more. The production of six color machines while using Polyethylene is from 1500 to 1700 meters of Polyethylene per hour. Four color printing machine prints about 2400 meters of paper per hour. Total production of these machines per shift is 30000 meters. Packages Limited manufactures and prints high density Polyethylene from 12 grams to 60 grams. And in case of low density Polyethylene it is 20 to 150 grams. In the Polly Section Polyethylene is made while in Waxing Section, the wax machine leaves a film of wax on paper. The Injection Molding machine in the Injection Molding Section makes plastic crates for milk transportation. But lately this section is not working as the demand for them is decreasing. In the Polly Lamination Section, Polly Lamination is done on paper’s surface to make the surface seasonable and shiny.

FLEXIBLE PACKAGING DIVISION (FP)

As the demand for sophisticated packaging grew, Packages Limited established Flexible Packaging Department in1986 that is fully equipped to manufacture high quality packaging. Molded from synthetic materials, rubber plates are used in Flexography. It uses the Roto Gravure printing technique. This Roto Gravure printing is best for food items, for this type of packaging 98% material is imported as a result it is the most expensive printing technique.

· One Six Color Roto Printing Machine

· One Lamination Machine

· One Rewinding Machine

· Two Slitting Machines

· A Shrink Packing Machine

This printing is more expensive than stereotype printing. Metallic Cylinder is used in order to get fine printing. This cylinder picks the six color solvent based ink. The material’s surface should be 100% glossy and smoother. It processes films whether they are paper, Polly or aluminum foil based, are laminated by containing two or more layers so as t give the required barrier properties against moisture, gases and odors. It produces packaging for soap and confectionery industry. The printing is done in very attractive colors and designs.

OFF-SET PRINITNG DEPARTMENT

This is the largest printing section of Packages Limited. This department has the largest share in the total Packages Limited sales, which is about 55%. There are 12 printing machines in this section which are used for printing on duplex board. There are two varnishing machines and one laminator machine. This printing facility is available from two to six colors. These machines use oil based ink. Normally they print cigarette cartons, biscuits, shoeboxes and tea boxes. In July 1994 they produced record production of 15200000 sheets.

Offset printing is the art of printing from a flat surface. In this method the blanket and transfers to the sheet to be printing first receive the image. The blanket is made of rubber. Off-set printing is based on the principle that grease and water are not readily mix. Printing is done from Mattel plates. The image is put on the plate by a photo chemical process. The image area on the plate is processed so that greasy ink sticks to it but water runs off. The non-image area of the plate processed to pick up and hold water but not ink. Each Off-set machine has different cylinders that is, six color machine has six cylinders, five color has five cylinders and so on. Each cylinder is used for the printing of a specific color. The cylinder takes the ink from the ink pan and prints it on the paper board running on the other cylinder. The paper goes forward and then another cylinder prints another color and so on, until the sheet is printed according to the right format. Regardless of the type, Off-set presses have four basic systems:

· Feeder System

· Registration System

· Printing System

· Delivery System

The Duplex board is used in this form of printing. The weight of board is 240 to 490 grams. They use imported machines, these machines are made by “PLANETA, M.A.N, ROLAND AND HIEDLBERG”. ROLAND machine is latest and print in five colors.

CORRUGATED DEPARTMENT

For large scale packaging, Packages Limited has been manufacturing “Corrugated Carton” since 1971. These cartons produced in different sizes, are used for transporting consumer products from manufacturer to retail outlets. The share of Corrugated Department in Packages Limited total sales is almost 20%, which is second after the Off-set department. Corrugated cartons are of great value for the export of fresh fruits, garments and shoes a wide variety of gum tapes for sealing corrugated cartons are also manufactured. Corrugated department has two main wings

· Solid Board

· Corrugated Boxes

In solid board, the board is stitched in the form of boxes. In corrugated, boxes are made by stitching and gluing. This department producing almost 2.5 to 2.8 million boxes per month. The department packaging material provides greater protection against damages and pile ranges of products. For making a box following are the steps:

· Making three or five layers sheets from paper rolls.

· Cutting them in sheets according to the size required for package, which is to be produced.

· Cutting, Creasing, Printing, Folding and Gluing these sheets to shape it into the box.

· Then also bundling these boxes in specifies number.

ART DEPARTMENT

Packages limited has an art department in which qualified, efficient and talented artists and designers are working. The artists and designers in the department are very creative and for most of the time are involved in designing the new packages. Art department gives attention to the advice of the marketing and of the customer. There are two sections in the Art department.

· Creative (Comprehensive) Section

· Mechanical Section

CREATIVE SECTION

The main function of this department is to create new designs in accordance with the customer’s specifications. When a new order is to be processed the sales officers contacts the creative section to provide basic information about the idea, number of colors and size etc. as requested by the customer. The designer then visualizes the idea and creates four or five Comprehensive designs. These designs (blank samples) are shown to the customers and the best one is selected. All the designs are made on computers. Then hard copy of these designs are made through the use of colored Laser Printer.

MECHANICAL SECTION

Approved designs from the creative section come in mechanical section. Designs in black and white are prepared in this section. Sensitive black and white films are used for better results for color photograph, which is called a transparency. Coordination between art designers and mechanical artists is very necessary for good designs.

The mechanical is then sent to the Planning Department and is checked according to the limitations of the printing, cutting , etc processes. Then sample is sent to the Marketing Department for the customer approval. If the customer suggests some changes, then these changes are made and the whole process of checking is repeated. After the final approval of the customer, it is sent to the Camera Department for making negatives. Art Department uses “MACINTOSH” computers and other design equipment.

CAMERA DEPARTMENT

Camera Department makes negatives and color separation from the mechanical by using cameras. Earlier this whole process was done by manually but recently Packages Limited ha bought a sophisticated fully computerized color scanner. Then with the help of scanners and manually, it is found out that how much quantity of each color is required in the design. The department has increased its efficiency and quality of films. In the Camera Section, there are four colors use to get the negatives: Magenta, Yellow, Cyan, and Black.

The number of negatives is subject to the number of colors used. If necessary transparencies can also be made of the design.

COATING DEPARTMENT

When paper & board is manufactured in Paper & Board Mill, its both surfaces are coarse. For printing purpose, it must have smooth finish. For smooth finish, it is send to the Coating Department, where it is processed to a smooth, shinning, extra whit upper layer or both sides. Color coating of paper and board is also available.

CUTTING AND CREASING DEPARTMENT (CC)

Cutting is the process which gives the carton its shape. For each new product a cutting die is prepared from drawings. This department is equipped with latest cutting and creasing machines having a great efficiency along with accuracy.

LAMINATION DEPARTMENT

This department has two machines which laminates the paper on single side or double side. This lamination process is started after printing, as the customer requirements.

FOLDING AND GLUING DEPARTMENT (FG)

Folding and Gluing is last process, which takes place before the completion of the carton. The printed material after passing through the cutting and creasing processes is passed on to the folding and gluing section. A carton, which can not be glued on machine, is glued by hand manually. Last examination of quality control is conducted in this department. From this department, the job is packed in boxes and sent dispatch department.

PAPER AND BOARD MILL DIVISION

DEFININTION OF PAPER AND BOARD:

When the weight of one square meter of sheet exceeds 130 grams, it is termed as Board or Paper Board. Substance lower than 130 grams per square meter is called Paper.

The paper and board mill started its production in 1968. At present the production capacity is about 50 thousands tons per year. It full fills the entire requirement of the packing division and surplus quantity is sold to the specific customers who are not their competitors directly or indirectly.

The varieties of papers and board produced in mill are as follows.

BOARD

1. M.G WHITE DUPLEX BOARD

2. FILE CARD

3. IVORY CARD

4. WHITE CARD

5. KRAFT LINED BOARD

6. GREY CHIP BOARD

PAPER

1. WRITING AND PRINTING PAPER

2. DUPLICATING PAPER

3. IMITATION ART PAPER

4. OFF SET PRINTING PAPER

5. CALENDAR PAPER

6. M.G BROWN WRAPPING PAPER

7. TWIST PROOF PAPER

8. TISSUE PAPER

PRODUCTION PROCEDURES

Paper and board production starts from the testing and cleaning of raw materials which are wheat straw, rice straw, Kahi and waste paper etc. The production process gets into specialized sections. Initially the raw materials are cooked with chemicals under specific condition and temperature in the digesters for about four to five hours. During this process the raw material are changed into liquid cotton like dark brown material called pulp. The pulp is the basic material for the production of paper and board.

The Paper & Board Mill work under the planning department. Marketing Department projects it prospective sales for the coming year. These projections are then sent to Planning Department which plan the production schedule for the Mill. In the Paper & Board Mill this whole year plan is broken into monthly plans. The Mill staff then, fined out financial needs and these needs are passed to the Finance Department. Following are three sections of Paper & Board Mill.

1. Pulp Section

2. Paper Section

3. Utilities Section

1. Pulp Section.

The function of pulp section is to prepare Pulp from raw materials. The pulp section has four departments:

a) Straw Preparation Department

b) Cooking House

c) Bleaching House.

d) Beater House

a) Straw Preparation

Wheat straw and cotton lintels are first cut and then cleaned to remove impurities. The material is fed to the digesters after a secondary cleaning of wheat straw.

b) Cooking House

Wheat straw and cotton lintels are mixed with chemicals and cooked in digesters (water & cooking liquor) under specific conditions of pressure and temperature. The mixture is fed to rotary digesters (Huge Tanks) and cooked. In this process the fibers get separated from the binding material. This process is known as Delingnification. Straw and Kahi are either cooked together or in separate digesters.

c) Bleaching House

To achieve the desired whiteness and brightness the material is washed and screened and the uncooked fiber is separated in order to get refined Pulp. The bleaching process consists of the following steps:

· Hypo chloride is added to pulp

· Chloride is added to the pulp

· An alkali (Caustic Soda) is added to the pulp.

d) Beater House

Beater house also known as stock preparation plant, is the heart of paper making process. Here we impart the desired properties for paper and board by refining and blending different pulp and then mixing them with chemicals.

· Addition of imported wood pulp

· Addition of sizing agents

· All other additions regarding any other properties that we want in the paper.

2. Paper Section

In the paper section, we deal with the paper machines used to make paper and board from the pulp produced by the pulp section. Paper & Board Mill has four machines:

¨ PM-1

¨ PM-2

¨ PM3

¨ PM-4

Now we briefly give the description of the Paper Machines used in this section.

PM-1

PM-1 is bought in 1966 from “SANO IRON WORKS, JAPAN”. It had a capacity of 50 tones per day. It was rebuild in 1981 with “GERMANTECHNOLOGY” and its capacity increases to 70 tons per day. This is a multiple board making machine. It can make 2 to 3 ply board. Its width of paper sheet is 2.7 meters, and grammage range is140-490 grams. The types of paper board produced by PM-1:

· White Duplex Board

· Corrugating Medium Paper

· Craft Liner Board

· White Card Board

· Kraft Board

· Chip Board

PM-2

This machine was bought in 1984 “BELL”, Switzerland and has a capacity of 50 tones per day. Packages Limited modified it to increase its capacity to 75 tons per day in1992. It can only make up to two ply board. Its paper width is 1.83 meters, and grammage range is 70-240 grams. The types of paper and board produced:

· Off-set Printing Paper

· Wrapping Paper

· Craft Paper

· Tetra Duplex Board

· Brown Craft Paper

PM-3

It is a “MG YANKEE” machine bought in 1966 from “ Switzerland”. It was modified in 1982 for the manufacturing of tissue paper and again modified in 1988. Its production capacity is 12 tons per day. Now this machine can make only single ply. It normally manufactures:

· Glazed Paper

· Wrapper Paper

· Brown Draft

· Poster Paper

PM-4

It is the most new Paper machine, which the packages Limited, has added in its line of paper machines. PM-4 was installed in 1992 by the technical staff of Packages Limited. It has the capacity to produce 15 tons of paper per day of paper per day. It is an imported “ITALIAN” machine for manufacturing the tissue paper. It has produced 16 grams tissue paper.

The paper & board manufactured by paper machines are wound as big reels. The reels are then send to Paper Store from where it is provided to the Packaging Division. There it is cut, printed and converted into packaging material used by various industries.

3. UTILITIES SECTION

Utility section is the third department of Paper & Board Mill. Under this section two main subsection works, they are

1. Quality Control

Various tests, e.g. water and oil absorption test, bursting strength test, are done in this section to ensured the desire quality of paper and board. This section is also responsible for keeping the Mill working. Its jobs are:

· Replacement

· Maintenance

· New Installations

2. Dispatch Section

This section has three main functions:

· Store of Paper

· Finishing of Paper

· Dispatching Paper & Board

DISPATCH DEPARTMENT

This department dispatches the goods produced by Production Department to the respective clients. The motivation of this department’s workers is enhanced due to the incentive scheme.

QUALITY CONTROL DEPARTMENT

This department examines the quality of products producing by Production Department. They make tests about the quality of printing, grammage of paper or board and compare them with customer specifications and prepare reports about results.

TECHNICAL DEPARTMENT

This department is responsible for the repair and maintenance of machines and construction of building and roads in the factory. There are 130 employees in this department. It works in two shifts. In case of emergency third shift is carried out. It provides the necessary spare parts and machinery to different departments. Technical Department is responsible for making tools and spare parts. Some time it works for other industries. It normally accepts the orders of Roll Grinders. These orders are accepted only on cash basis. It is divided into small departments, which do specific work. These are:

Mechanical Workshops

It is concerned with the manufacturing of spare parts and the installation and maintenance of new machines. Lately it has installed the new Paper Machine 4 (PM4) successfully. The Design Office is directly under this section.

Design & Development

The design & development department of Packages Limited is under the Technical Department. This department designs buildings, roads, spare parts and machines. For this purpose, several draftsman are working in this division.

This department is responsible to develop and up date new and second hand imported machines. The design department of Packages Limited has successfully made various machines. In this department designing is done both by manually and on computers. For this purpose they are using AutoCAD. For every assembly drawing, cost estimation and feasibility reports are prepared. The labor and material costs are also estimated. These machines are not used in Packages Limited but also exported to Indonesia, Tanzania, Nigeria and U.A.E. A brief list of the machines made by this design department are as follows : Gum Tape Machine, Foil Lamination Machine, 2 & 4 Color Roto Printing Machine , Sample Creasing Machine, Mobile Inclined Belt Conveyors, Multi-Mixer, Laboratory Beater, Sheet Waxing Machine, Blade Grinders.

Workshop

It works under the design department. The machines designed in the design department are manufactured in the workshop. The work in the workshop is carried in two shifts of eight hours. Over time is given to the workers but no special incentives are given.

Civil Department

This department is concerned with the construction of building and roads. Packages Limited is growing day by day. So it also needs new buildings and plants. The building and roads constructed by the Civil Department. Export architectures are working in this department, they work on building by keeping in view the future needs.

Air Conditioning & Electricity

Technical Department is responsible for the supply of electricity and maintenance of air-conditioning system. Technical Department also leads its services to other industries. If any industry calls Packages Limited for any type of maintenance or construction, the Technical Department provides its services with open heart.

THE RESEARCH, DEVELOPMENT

& CONTROL DEPARTMENT

THE RESEARCH, DEVELOPMENT & CONTROL DEPARTMENT

If the industry wants to grow not just survive, then it should take care of its Research and Development Department. World is changing day by day. Development in Packaging material is a continuous process. New materials, films, fibers, chemicals, adhesives and coating always are researched and developed. As Packages Limited wants to retain clients, stay out of court and improve profits, so it gives much consideration on quality of the product. To keep up with new demands, Packages Limited has a Research, Development and Control Department. This department works in close collaboration with Production and Marketing departments. This department has well equipped laboratories and pilot machines, which are used to test various chemical raw materials and machines. It enables Packages Limited to provide better quality and latest packaging to the consumer industry, enabling it to introduce new product lines an develop new materials. The Research, Development and Control Department has three major areas for its activities:

¨ Research

¨ Development

¨ Control

RESEARCH:

This section is directly responsible to the Production Manager about his research. In Research, work is done with on the idea, experiment is divided into parts and on each part attention is focused and conclusions or suggestions are given. Packages Limited tries to get as many information and technology which is possible and beneficial to the organization. All such information is collected for research. Some time they receive reports of customers’ problems and complaints from Marketing Department and advise to them through the same channels.

DEVELOPMENT:

Development is a continuous process in any organization. A lot of development is the result of feasibility studies, study of new production methods and new products. Packages Limited has a Paper & Board Mill, so it uses largest number of chemicals. The “Environment Protection Agency” has some standards for reducing pollution. The R,D & Control Department developed new way of reducing pollution and always tries to meet EPA standards.

CONTROL:

Packages Limited R,D & Control Department divides term “CONTROL” into two areas:

¨ Quality Control

¨ Process Control

Quality is synonymous with Packages limited. Every packages made by Packages Limited guarantees the use of quality materials and processing. This is all due to the strict quality Control Standards, observed at every stage of the production, from raw materials to dispatch Department. This department makes stringent requirements on quality control, which help in working consistently towards attaining better results for customers. To ensure constant quality and improvement this department managed by qualified scientists. Quality Control section has satellite laboratory in every department, which constantly monitor and report. There is on the spot checking and corrective treatment is given to the operators. If the percentage of defective material goes above the permissible limit, the supervisor and machine operator is given a signal to take corrective action. In Process Control , the process of production is carefully monitored. Samples from every department , e.g. Pulp Section, Beater House etc. are taken to quality control department and tested for standard. R,D & Control Department is divided into different sections for copying different types of problems. The sections are:

Rubber Section:

Rubber section is almost independent but has a link with R,D & Control Department. The main purpose of this section is to solve the problems of making special rubber parts. All rubber goods produced by the Rubber Section are used in different departments of the organization. Because of this section, company does not need a single thing of rubber to buy from the outward market. This department helps the Packaging Department, Corrugated Department, and Paper & Board Mill. About 70% of the material is used in the manufacture of the rubber. About 20% material is imported and the rest of the material is acquired from the local markets. Some important products of this departments are Gas Kits, Seals, Bushes, Rubber Rollers, Rings and etc.

Physical Paper & Polly Packing Section:

R,D, & Control Department has a physical Laboratory where the physical characteristics of Paper & Board are tested. The standard of new material, pulp, paper and board are tested to find out if they are of required standard or not. This section is equipped with the most modern equipment and trained staff.

Pulp Section:

This section is the biggest section of the R,D & Control department. This section checks the quality of pulp produced in the Pulp Section. It also sets the standard of pulp for specific quality of paper required. Pulp is the basic raw material for the production of Paper & Board. Near about 82% of the paper is manufactured by pulp. The rest of paper and board is manufactured through the use of non wood fibers. In this regard they use Kahi, Staw etc. Packages Limited always tries to maintain its consistent quality. So some important tests, which are performed by the Pulp Section, are:

v Density test

v Moisture test

v Tensile Index test

v Tear Index test

v Thickness test

v Burst Index test

v Stiffness test

v Picking Velocity test

v Wax Velocity test

v Internal Bond test

v Surface Roughness test

v Porosity test

v Oil Absorption test

This section also conducts research for new raw materials and to improve the quality and composition of existing raw materials.

Chemical Section:

Packages Limited has one Chemical section, most of the chemicals are used in the Paper and Board Division are produced in this section. These chemicals include Sodium Sulfate and many other. R,D & Control Department has a duly equipped chemical laboratory that conducts research on the chemical aspects of the packaging materials. One another important function of this department is to determine the percentage of these additives used in the finished products. Normally these chemicals are purchased from local market. Quality tests are carried out in the chemical laboratories. It also provides help to other Departments where Chemicals are used.

Development Section:

The development section is engaged in the long term projects, follow ups and the design aspects of the production.

Microbiology Section:

Main function of this section is to conduct research and development in the field of food packaging.

Library:

The R,D & Control Department has a library also, where a number of books about Packaging Industry are available. The Library provides the best material for related fields and also some on other general topics. Staff of Packages Limited come there and get information which may some times help in decision making about the problems. The library also keeps the record of all the Research and Development activities for this department. In this section books & material are available on the following topics: Business Administration, Printing, Accounts, Water Treatment, Urdu, Islamic Literature, News Papers, Statistics, Management, Magazines, Economics, Mathematics, Chemistry, Mechanical, Engineering, Packaging and Pulp Industry etc.

MANAGEMENT INFORMATION SYSTEM

MANAGEMENT INFORMATION SYSTEM

Management Information System (MIS) is also called Computer Section. Before setting up their own Computer System, Packages Limited hired computer services. But when work grew and requirements increased, Packages Limited has set up their own computer system. Now all the computer related work of all the departments is performed in this section. MIS Manager is the head of this department and he is answerable to the General Manager. Its responsibility is look after the data processing and making software for Packages Limited. There are two senior system analysts, nine data entry operators, four computer operators and one supervisor. System Department almost helps the whole organization because almost every department is to some extent computerized. The major job of this section is to assist the Accounting department and that’s why it is situated adjacent to the Accounting department. At this time, Packages Limited use the following systems efficiently:

· Accounting System

· Inventory Control System

· Human Resource Management System

· Production Incentive System

· Production Planning System

· Job Casting System

MIS Department works in collaboration with “SYSTEMS LIMITED” which maintains the all accounting data of Packages Limited. This job is done through parallel that is the programmers at Packages Limited can also use the facilities of “SYSTEMS LIMITED” simultaneously.

The Computer Department of Packages Limited mostly develops programs in C language. This department have done a lot of programming for the organization. At this time all systems, which are use in the System Department, is developed by its own staff. Normally they do not take enough time to develop a new system. After developing the system they debugged and checked again in order to remove any problem if it exists in the real situation.

Earlier this section was using 8088 and 80286 computers but now they have become obsolete due to the rapid development in computer technology. Now they are using MULTI-USER DECSTATION 5000/125. Configuration of this system is given below:

CONFIGURATION

MODEL NO	DESCRIPTIONS
PM 339-JY	DS 5000/125 SBM 16 MB ULT DECSTATION 5000 Model 125 16 Mb of 4m bit dram, 25 MHz CPU CPU R3000 FPU R3010(Maths) MIPS 26.8 Clock Speed 25 MHz Cache Memory 128KB Memory Capacity 8-128 MB Including Software licenses: ULTRIX, FNS,DECWINDOWS, DECENT C, MOUSE, UNIFY
COMPAQ MODEL	250 PCs attached with net working

The cost of this system is US $ 46000 and additional cost of each terminal. Packages Limited at this time use “ON-LINE SYSTEM”.

Packages also have 32 Personal Computers in different departments to fulfill the requirements. And almost each department has laser printer.

The top management believes that this computer section has a great deal to expedite routine jobs at Packages Limited. Now the Packages Limited again going to update their system department by purchasing the advance technology “SAP” under consideration to overcome the Y2K problem.

POWER HOUSE

Power House working under the System Department. In 1967 they set up 6 MW power plant, but to ensure a continuous and dependable supply of power for its Production lines, Packages Limited has also established its own 10 MW Power Plant in 1991, the cost of Plant was 180 million rupees. As the needs for the use of electricity is increasing day by day, hence Packages Limited also uses electricity from WAPDA. Packages Limited keeps WAPDA’s 1321 KV Nation Grid as a back up. Packages Limited saves a lot of money in this regard. For example if they get power from WAPDA, they have to pay more than Rs. 5 / unit but the expenses of own Production is Rs. 2 /unit app.

The power generation is handled by “SEIMENS”. They also responsible for its maintenance. The Power House works for 24 hours and there is no holiday for workers. There are three shifts in 24 hours. The worker’s get special relaxation by the Personnel Department.

PERSONNEL DEPARTMENT

PERSONNEL DEPARTMENT

Personal department is another one of the most important departments in an organization. The success of an organization is dependent upon a successful personnel department. All the progressive organization give a great attention and importance to their personal department. The prime objective of this department is to manage and utilize the human resources in a fruitful manner. It is obvious that if the employees are good then the pre determined objectives can be easily achieved with efficiency and effectiveness. This department deals with the selection of employees and their working performance. The most important objective of any personal department is how to improve the performance of employees at work.

The function performed by personal department are:

Ø Recruitment & Selection of Employees.

Ø Training and Development of Employees.

Ø Planning Work for the Employees.

Ø Performance Evaluation and Appraisals.

Ø Keeping Attendance Record

Ø Keeping Employees Record In the Organization.

Ø Compensation Management.

Ø Management Labor Relation.

Ø Discipline

Ø Welfare of Employees.

Packages Limited possesses a well organized and systematically operated Personnel Department. The success and effectiveness of this department’s policy and programs can be judged from the fact that no problem has come to surface in the recent years. The Personnel Department is headed by Personnel Manager.

The above mentions functions are performed by the four wings of the personnel department.

Ø Personal Staff Wing

Ø Establishment Wing

Ø Law Wing

Ø Welfare Wing

Ø Personal Staff Wing.

The wing is under the direct supervision of the personal manager. The wing advertises jobs for workers and mangiest. This wing also designs the recruitment policy. This wing also arranges training and development programs.

Ø Establishment Wing (Time Office Wing).

It is the largest wing of the department and is performing important functions. It keeps the records of the employees, calculate the wages and salaries, plans work for employees and evaluate their performance. The record keeping is very scientifically organized.

There are two types of employees in Packages.

1. Employees Working On Monthly Basis.

2. Employees Working On Hourly Basis.

Employees working on hourly basis get their wages through a card that contains the starting time of work and ending time. The work is noted through punching machine. The total working hours of employees are calculated and payment are made to them.

A gate pass is issued to the employees if they go out of the factory for any personal/official work. A copy of time pass is sent to the time office. If the gate pass time exceeds 8 hours, a leave is deducted from the employee record.

By using this system the performance of the labor force is easily evaluated. As the pay of an employee is directly proportional to the time worked, it acts as motivation. While evaluating the performance of employees, opinion of the supervisor or the immediate Boss play an important role. The promotion of an employee is highly influenced by his recommendations.

There is a casual leave of 10 days and medical leave of 16 days on the basis of medical certificate issued by the company’s medical officer. The hourly staff is allowed 14 days of annual leave. However, for one day medical leave is allowed and no medical certificate is required.

Packages Limited also gives bonuses for extra work. For each hour of overtime, the hourly wage is doubled. For monthly paid workers there is an attendance register. There can get leaves also. If an employee is absent for more than ten days without leave then he is issued a “Charge Sheet” and he may terminated.

Ø Law Wing

The labor management relational is the responsibility of the law wing. The main function of this wing is to resolve any conflicts between management and labor union. This section conducts all the disciplinary actions.

Ø Welfare Wing

The job of this wing is the welfare of employees. It arranges four types of mess for the employees. The meals are provided at the subsidized rates.

Adult education programs work under this wing. Medical facilities are also provided to the employees. Employees are entitlement for the clinic that is situated at SHADMAN COLONY. All the medical expenses are born by Packages Limited.

A fair price shop is also situated in the factory premises. All the basic utilities are provided at very low rates. This section also organizes the annual sports. The department is always working for the betterment of its employees.

PERSON NEL POLICIES

The main personnel policies are given below.

1. Recruitment Policy

Packages Limited is more inclined towards employing fresh graduates than highly experienced persons. The main reason behind the policy is that they believe in developing a person on their own grounds keeping in view organizational objectives.

2. Workers Selection

All the workers are taken on the designation of apprentice trainee. After the expiry of probation period if the performance of the trainee is found to satisfactory, then he is absorbed in the work force. Efficient and effective workers are promoted regularly after fixed periods upon the recommendation of the superiors.

3. Executive Selection

For the selection of executives if any junior executive is found competent, then he is promoted to grade E-III. For selection of executive outside the organization, jobs are advertised in the news papers and candidates are called for the interview. After taking a written test and brilliancy interview the selected candidates appear before the top management for the final selection.

4. Training

Training is very important to increase the employee performance. At the beginning of the new jobs, or if the organization adopt the new technology the employees are trained to meet the changes. Packages provide training facilities, which include on job training and of job training and also arranged refresher courses.

5. Organization

The selected candidates are utilized for the contribution in the organization. It is referred as compensation and includes monetary rewards and other facilities. Following are the grades in the organization.

Worker’s Grade

1. Grade-1 G-1

2. Grade-2 G-2

3. Grade-3 G-3

4. Grade-4 G-4

5. Grade-5 G-5

Executive Grade

1. Junior Executive (JE)

2. Executive III (E-III)

3. Executive II (E-II)

4. Executive I (E-I)

Managerial Grades

1. Manager-I (M-I)

2. Manger-II (M-II)

3. Manager-III (M-III)

Retirement age for the employees is 58 years and no extension in services allowed. The needed employees are hired on contract basis. Attendance cards issued by the time office to the workers. The cards are punched twice a day in their respective department whereas attendance record of monthly employees is kept in attendance register.

Hourly rate workers are paid at the end of paid every fortnight while the monthly staff is given their salaries at each month end. The employees are also given the following allowances.

1. House Rent.

House rent is 50 percent of the basic salaries which in some cases is 60 percent of the basic salaries. More than 60 percent of the employees have their own houses.

2. Conveyance Allowance

Conveyance allowance is given to the all employees. Loans are provided to the employees to get their own conveyance. Monthly allowances to employees are also given for maintenance of their conveyances. Employees who bring their conveyances to the factory are also given an additional allowance.

BENEFITS TO THE EMPLOYEES

The Packages Limited has given many benefit to its employees. A number of facilities are provided by Packages Limited for the training and welfare of its employees. Few projects are also working in this context.

§ Ali Industrial And Technical Institute

To maintain the technical level of the employees, an institute naming " ALI INDUSTRIAL TECHNICAL INSTITUTE " was established. This institute trains about 200 technicians annually. The duration of the course is two years and training is provided in different fields. Preference is given to the children of the employees of Packages limited. The students are provided free uniforms, subsidized books, food and milk and a scholarship. After passing out from the institute the technicians are free to seek job in any industry of their choice.

§ Food

Food is provided to the employees of packages limited. The food is prepared under most hygienic conditions and is subsidized at highly subsidized rates.

There are four messes, which provide meals to the employees

These are as follows: -

1. VIP Mess

2. Manager Mess

3. Supervisor Mess

4. Workers Mess

The food is provided at very less cost to employees. The rates are highly subsidized in the each mess.

§ Uniform And Locker Facility

Every worker is provided with two uniforms yearly. They are also provided with the locker facility. The company also arranges laundry service. Two soaps are also given to the workers for maintaining their personal hygiene.

§ Provident Fund

Each employee of the organization contributes 10 % of the basic salary and the company for the provident fund contributes the same amount. The employees receive this amount at the time of their retirement or when they leave the organization.

§ Pension

There are two pension categories organization. One is for the management staff and the other for the worker employees.

The first category contribute 13% of their salary whereas the other category contributes 4.5% of their salary. The amount is deposited in the government securities. The employees are entitled to receive this amount after 58 years of age. The employee gets 100% pension up to his life. After employee death his widow gets 50% of pension amount. After wife death the children can take 20% of pension until he is less than 21 years.

§ Bonus

All the employees get handsome bonuses every year, which varies from grade to grade.

§ Group Insurance

Company’s policy is to have its employees safe and sound financially. The company insures so all the workers and the premium amounts are also paid by the company.

§ Recreational Allowances

The company encourages and supports recreational activities. Employees in groups are encouraged to go excursion trips and the expenses towards their transportation etc. are paid by the company. Employees can also use the rest use owned by Packages Limited in Murree.

§ Overtime

Workers who work more than regular hours are paid twice of their pay that includes basic pay and the dearness allowance. Employees of E III and E II grade are also entitled for overtime.

§ Welfare Fund

It is the duty of the organization to establish a welfare fund in which both company and the workers contribute equally. The heirs of employees are entitled to receive money from this fund.

§ Social Security

Social Security is applicable to all workers of Packages Limited who are drawing up to Rs. 1800. Medical facilities are also given to the employees and their families. Medical facilities are also available in the factory's premises. Employees receive free medical treatments from the company's specified clinics and dispensaries.

§ Fair Price Shop

A Fair Price shop is present inside the factory from where basic necessities along with the provision of some basic commodities are available on very subsidized rates.

§ Adult Education

All the illiterate employees are required to undergo an education program for two years. All the reading and writing material till primary level is provided free of cost.

§ Haj Pilgrimage Scheme

Every year three of the employees are selected to go on HAJ. The company pays all the expenses. Any worker who wants to go on HAJ on his own expenses is given one month paid leave.

§ Health Development

All the workers are encouraged to participate in sports activities. A sports complex is also available for the employees, which provides sporting facilities of Badminton. Squash Table Tennis, Carom, and Chess etc. Facilities for Hockey, Football, Cricket, volleyball and swimming are also available. Yearly interdepartmental sports competitions are a regular feature.

An exclusive children fair is also held every year.

§ Educational Stipends

Educational stipends are given to the children of the employees from matriculation to post graduate level.

§ Service Award

Employees are awarded different souvenirs after completion of twenty years or more. After twenty-five years of service a valuable wristwatch is also presented to the employees.

§ Loan Facilities For Car/Motor Cycle

Loan is granted to the employees for the purchase of cycle, motor cycle and car. These loans are free from interest and all the grades are eligible for these loans.

§ Mosque

One beautiful mosque is in the factory area so that everybody can offer his prayers and I observed that considerably large number of employees uses this facility.

MARKETING DEPARTMENT

MARKETING DEPARTMENT

We are living in an age of Marketing. You do not sell what you make rather you make what you sell. Today in any organization, Marketing Department is of paramount importance. Because it plays a link between the consumer and the producer. The function of the marketing department works effectively and efficiently, the whole organization is on a smooth run. Like all other departments the Marketing Department of Packages Limited shows a good performance. The marketing department plays a key role in the operations of the organization. The marketing manager is responsible for all the marketing operations in all three offices in Lahore, Karachi & Islamabad. The marketing department of Packages Limited is responsible for sale of industrial & consumer products. Planning division of the Product Department works closely with the Marketing Department to ensure the meeting of established targets. Packages Limited has divided into the three regions i.e., Lahore, Karachi & Islamabad. Each is assisted by the Area Marketing Manager who is second in line of authority, direct under the Marketing Manager. Marketing Manager also look after the Consumer Products Division. Each region is responsible for the sale of its area. All managers are assisted by a team consisting of Regional Sales Manager, Senior Sales Officers, Sales officers and sales supervisor. There are two Regional Sales Managers under the area marketing manager. One for industrial sales and one is for the consumer products. Then there are senior sales officers and sales officers. The Deputy General Manager who is also among the Board of Directors of Packages Limited is often consulted by the Marketing Manager for important managerial decisions concerning Marketing Department. The regional sales manager acts as a coordinator between the sales officers and the Area Manager. Sometimes he is also assigned with some customers but usually not more than one. Each sales officer is allocated a certain number of customers. The respective officer will deal with these customers and solve their problems. In case of some trouble, the Area Manager does involve and tries to settle things. His advice is especially taken while developing, launching and pricing of new products or amending the prices of existing products and so on. Packages Limited deals with two division:

· The Industrial Marketing Division

· The Consumer Products Division

The performance of marketing activities of firm has increased due to this segmentation of division. Following are the important factors, which differ between these two divisions:

· Distribution channels are different.

· Target market is different.

· Both have their own competitors.

· Marketing policies are different for each division.

INDUSTRIAL PRODUCTS DIVISION

This division has emerged to be a strong tool enhance the sales of those companies making products that are used in the production of other goods and services that are sold, rented or supplied to other. Marketing is no longer activity of the makers of the consumer products. Industrial Marketing is the need of the manufacturing firms. In this regard this division assumes a key importance. This division is responsible for the industrial goods. The industrial products, which it markets, are numerous. The major products come in the category of packaging products. These include:

· Products available in Offset Printing

· Products available in Flexo graphic Printing

· Products available in Rotogravure Printing

· Products available in Flexible Packaging

· Corrugated products

MARKET SHARE

Packages Limited 22%

Others 78%

Industrial Marketing Division is directly related with industrial users. Packages Limited produces good quality packaging products. Packages Limited has 22% market share in packaging industry as a result they are single largest packaging unit of Pakistan. There are lot of small manufacturers which are much cheaper but their quality is not of that level but due to low prices they are there. In case of “Rotogravure Printing” Packages Limited has the monopoly. As it is the latest addition in the packaging industry of Pakistan and only Packages limited has the machines to make it. It is very expensive and more than 70% of the raw material is imported. Major competitors are:

· Pak Paper Products

· Pap Board Printers Rawalpindi

· Almas (Pvt.) Limited Karachi

· Metatax Press Karachi

· Security Paper

· Industrial Packaging Karachi

· National Packages Karachi

· Friends Packages Karachi

· Uni Flex Printing Services Karachi

· Rainbow Packages Limited Lahore

· Orient Board (Pvt.) Limited

· Toufigue Printers Lahore

But there is no competitors which has more than 10% market share. The Packages Limited has an edge over competitors in different factors:

· Packages has own Paper & Board Mill

· Modern machines & equipment

· Printing quality of products

· Timely delivery of products

· Provides help in designing

Almost 90% of the sales of Packages Limited comprise of industrial products. Packages Limited is the marketing leader of the packaging industry of Pakistan. Packages Limited produces the wide range of packaging material in the country. It manufactures material, which covers paper & board, corrugated board, plastic packing. The major industries whose packaging requirements are being fulfilled by Packages Limited are as follows:

· Food Industry

· Soap & Detergents Industry

· Cigarette Industry

· Tea Industry

· Shoe Industry

· Match Boxes Industry

· Toffee and Candy Industry

· Biscuit Industry

· Pharmaceutical Industry

· Chemical Industry

· Tooth Paste Industry

· Garments Industry

The main customers of Packages Limited are:

· Lever Brothers

· Pakistan Tobacco Company

· Rafhan Maize Products

· Bata Limited

· Crescent Textile Industries

· Lawson Premier Group

· Brooke Bond Limited

· Pak Elektron Limited

· Orient Match Factory

· Treet Corporation

· Nirala Sweets

Packages Limited receive two types of order from the customer:

· New order

· Repeating order

For new orders Sales Officer will go to the new client and will try to sell their products to him. The Packages Limited has on limitation, that it cannot fulfill small orders from customers because the factory over head costs are too much which can not be justified in small orders of less monetary value. If the customer agrees to buy from Packages Limited then it is the job of Sales Officer to coordinate with the customer. First priority is to listen to the ideas are not worth of use then the Sales Officers use their own expertise and design a suitable packages then they will make repeat purchase. Normally companies consult themselves with Sales Officers by making a phone call or by writing a letter. When Sales Officer will get order again from his client he will repeat process of issuance of ISO.

PRICING POLOCIES FOR INDUSTRIAL PRODUCTS

Since industrial products vary in nature to a great extent so there is no fixed price for any product. In Packages Limited prices charged are quite high due to their good quality and standard. The Marketing Department prices for each of the products separately. There are some standards regarding prices of different package design but they vary according to the factors listed below:

· Material used for the package

· Printing on the package

· Size of the package

· Quantity ordered

· Prospects of repeat sales

· Art work charges

· Term of agreement

· Number of colors to be used in printing

· Time of completion

PRICING OBJECTIVE:

The pricing objective of the Marketing Department at Packages Limited is to “Maximize Profits”. But some time prices are decreased in the benefit of the company. The basic objective is to reap long term gains. The prices of the company’s products depend largely on the pricing objective.

The prices are usually negotiated between the buyer and the sales personnel who are Assistant Sales Managers. The manager estimates the cost expected to be incurred on the product as well as the position of the buyer who usually an organization. They are normally deal with the strong organizations. The price for the industrial products are determined on the formula :

Cost + Profit = Price

In order to determine the price to be charges for an order the company simply adds desired profit to its estimated cost of production. In price determination the first aim is to cover the cost. After this a reasonable amount is charged in the term of profit. There are certain factors, which affect this profit margin.

DISTRIBUTION POLICY FOR INDUSTRIAL PRODUCTS:

Packages Limited being basically an industrial products manufacturing concern its distribution system consists of direct selling from producer to the consumer, no middle man is involved. Company’s sales force directly goes to the final customer and gets order from them. Packages Limited believe that direct marketing is quite cheap for industrial goods. The reason, which they quote, is that we have enough sales force all over the country and which can cover the industry more economically. Packages advises its customers to take their packaging material from the factory premises. Either the buyer’s transport comes to the premises of Packages arranges to send the products to the customer. In any case no freight charges are borne by the Packages Limited.

ALLOCATION OF CUSTOMERS:

At Packages limited every sales officer is allocated different customers and is responsible for dealing with them. Every sales officer has a complete record of his customer and pays regular visits thus remaining in constant contact with them. On average a sales officer has to deal with more than 20 customers.

DAILY TARGETS:

In the Marketing Department a meeting of all the sales officers is held every morning. This meeting is headed by the Marketing Manager or the Area Marketing Manager or both. Each sales officer explains the current situation of his customers and the development prospects if any. The sales officers also inform the Marketing Manager or the Area Manager about what they did the previous day. They are then guided as to what should do, and are assigned certain duties regarding the mode of action they are to adopt. Sales officer also provide current information about market. Sales officers spend most of their time out in visiting their respective customers. Before going out, they have to report which includes the date, time of departure, number of customers to visit, expected time of arrival on the board.

MOVEMENT REGISTER:

Every sales officer before going out of Packages Limited for official work has to fill a “Movement Register”. The filling up of this register enables other officers and staff of the department about the expected time of return and place to be visited by the sales officer. In the marketing department spending more time of the sales officers in the office is not encouraged.

Generally it is not easy task for a sales officer to get an order from customer or to develop a new customer. In order to find out the potential customers it is the duty of every sales officer to remain well informed about the market and grab every opportunity as and when it arises if it seems profitable. When a sales officer finds a potential customer he pays him a visit and tries to convince him to sign a packaging contract with Packages limited.

Packages Limited, as a policy matter always prefers repeat sales. It does not look forward very eagerly to one time order. Most of the business is of repeated nature. Thus getting repeat orders is also one of the important jobs of a Sales Officer. A repeat order can be taken through a telephone call a written letter or a visit.

CONSUMER PRODUCT DIVISION (CPD)

The CPD of Packages Limited deals with the consumers products. It is producing a wide variety of consumer products like tissues, paper cups, toiletries etc. Tissues Paper at Packages Limited is manufactured at Paper & Board Mill in reel form. In the production hall, tissue reels are cut into individual tissues and then packed. The “Rose Petal” line of products includes facial tissues, toilet rolls, kitchen rolls, paper napkins, paper cups & plates. Apart from ROSE PETAL, Packages Limited is producing tissues for various companies like UTILITIES STORES etc. the other brand in tissues is “TULIP TISSUES”. Lately, they have started selling imported tissues under the brand name of “COTTENELLE”, the raw material that is tissue paper is imported from Scotland. What they do is cutting, packing & selling. This division performs the activity of selling products to the ultimate consumer. The division has established three sales offices in Karachi, Lahore & Rawalpandi. Now from April 1994, they started a new sale office in Multan. In 1981 company entered consumer products. In the beginning, it was decided that the Industrial Sales Division will also look after the affairs of consumer products. In 1985, the distribution functions of the consumer products were handed over to Tetra Pak but in 1986, Packages Limited established a new division with the name of “Consumer Product Division”. This division is totally separated from Industrial Products Division and follows its own policies. It makes its sales plan freely.

MARKET SHARE OF CPD

CPD is responsible from the production to the distribution of all these products. After its establishment CPD workers were able to establish a distribution system which covers the whole country. Now CPD has around 100 distributors which covers the whole country. Few years’ back Packages Limited has the monopoly in the tissue market. Although CPD people do not accept that Flying is giving them a tough time. But after its introduction they improved their quality by making tissues on a new machine PM-4 that is far better than the previous one. But still they are market leader and have more than 80% market share. Their distribution covers the entire country while Flying is only limited to big cities. Apart from Rose Petal, Packages Limited has Tulip Tissues and Cottenelle Tissues. Packages Limited has the monopoly in case of paper cups and plates and enjoys more than 80% of market share. Facial tissue has 60% CPD market share, Toilet tissue has 25% and Kitchen tissue 15% of CPD market share.

PRICING POLICIES FOR CONSUMER PRODUCTS:

In case of consumer products, Packages limited has strict pricing policies. Any where in Pakistan the consumer products of Packages Limited have the same prices. An other aspect of pricing policies is the competitiveness of the prices of Packages Limited. Pricing policy is very difficult for any organization. Pricing policies in Packages limited differ for industrial and consumer products. The basic objective behind the price determination of consumer products is to maximize the market share. The company actually wants a higher turnover. Prices are set by the marketing people by considering the following factors:

· Cost of production

· Pricing policies of competitors

· Consumer’s purchasing power

· Area trend

· Government policies

Every organization try to sell its goods on maximum profit. But first objective is to cover the cost of the production or to sell at the break even. Packages limited also first seek to cover the cost of production while the profit margin is set on order to maximize the market share.

The Packages was in good position to set prices without considering their competitors. But now a day a potential organization “FLYING TISSUES” has entered in the market. Their advertisement attracted so many customers and in this way they covered 14% market. The Packages Limited should also consider the factor of competition while making the pricing strategy.

Marketing Manager has to give attention on the Purchasing Power of the Purchaser. Marketing Manager then set the price according to the purchaser, because the main objective or philosophy behind the whole pricing concept is the maximization of market share. The prices of Packages consumer products are reasonable then any other.

One most important factor, which effects the pricing policy, is the taxes imposed by the government. Recently government announce 12.5% sales tax on consumer products, so it effects the price of products.

Packages Limited has the policy to charge a same price for all of its consumer’s products through out the country. In this regard, enough margin is kept to cover the freight and other expenses.

ADVERTISING:

In Packages Limited, they arrange advertisement on different electronic media. Infect, advertising is the most popular and effective media to persuade the customers.

Share of different media for advertisement by CPD

Television , V.C.R 65%

Newspapers 20%

Pop media 10%

Public Relation 1%

Others 4%

The advertising campaign of Packages Limited includes the following:

Television, VCR Films, Radio, Newspapers, Magazines, Samples, Gifts, Pop media, Out of door media.

ADVERTISING AGENCY

Packages Limited is doing intensive advertising for Rose Petal products. For this they are engaged with the renowned advertising agency R-LINTAS. They changed advertising agencies according to their requirements and demands. If agency is not fulfilling their requirements then they switched to another agency. From their CPD sales they spend almost 10% on the Advertising.

MAJOR COMPETITORS

We cannot imagine about a business without competition. Packages Limited has also some competitors for its consumer products. In facial tissues no competitor was exist in 1987 except the foreign brands. Then companies like “FAY” competed for some time but Packages Limited superseded them very soon and start enjoying their monopoly. Then it was “FLYING TISSUES” which came and captured a lot of market. Flying officers are really giving tough time to Packages Limited. So far as the Wet Tissues, there is no big competitor. The same is the case a unique thing as the tissue is imported from Scotland and here they only cut, pack and market. Packages Limited has defined and identified its target market for its consumer products.

TERMS OF TRADE IN CPD:

At the time of trade some terms are fixed by the customer by Packages Limited. The most important are given below:

§ Sales are made against full cash payment.

§ Payment has to be made as mutually agreed upon.

§ Packages Limited will send the letter of confirmation after the receiving the letter of the order.

§ An order once confirmed cannot be revoked by the customer but can be canceled by the will of Packages Limited.

§ If the government changed tax price will change proportionately.

§ If the prices of the raw materials changed the agreed price will be raised proportionately even if the confirmation letter has been sent.

§ Freight and octroi on goods sold are to be paid by the customer.

§ Once the goods are in transit, they become the responsibility of the customer.

§ Packages Limited will deliver the older as soon as it is ready.

§ Packages Limited tries its best to make deliveries on the due date but if fails to do so, it can be held responsible for the damages caused due to late delivery.

§ A margin of 10% of variation in the quantity is considered as a normal variation and the customer has to accept the order as such.

§ If the customer wants to make some alterations in the approved design, then he has to pay for all those expenses, which the company has made on the previously approved samples.

§ The customer can only claim for his order if the rejections of the supplied goods exceed 2% of the total order and the claim should be made with in the period of two weeks.

CPD INDUSTRIAL SALES:

Packages Limited also sold some consumer products to different industries. Sales officers personally visits hotels, and restaurants. If the prospective customer agrees to buy then he must have to enter in a contract with the Packages Limited. There is one condition that is the order should be for more than 24000 pieces. However, under certain conditions the product manager can relax this condition. These are:

· Tissues for various hotels and restaurants

· Tissues supplied to large organizations like PIA etc.

· Shoe shiner is only provided to a shoe maker company.

These products are actually distributed directly to the final customer that is no dealer or distributor is assigned this job.

FINANCE DEPARTMENT

FINANCE DEPARTMENT

Finance department has very important role in for any business firm now a days. So Packages Limited has established its own Finance Department on professional basis. Packages Limited has different financial managers who are responsible for the financial aspects of the Packages Limited. This department plays a key role in organization’s performance. Finance department is responsible to maintains accounts of all departments within the organization. For solving the complex and difficult problems, Finance Department is segregated into four divisions. These divisions are as follows:

1. Account Division

2. Internal Audit Division

3. Cost & Tax Division

4. Share’s Division

The share’s division of Packages Limited exists in Karachi. This section deals in all the transaction about the shares of Packages Limited.

Major Functions of Finance Department

Finance department performs different functions in the organization to run the finance of the organization more effectively. Finance Manager is responsible for the company’s financial management. The major functions which by this department are as follows:

· Calculate different expenses of the organization.

· Calculation of all incomes, receiving from sales & other resources.

· Financial planning of the organization.

· Distribution of profit to the share holders.

· Getting loans from banks and other financial institutions.

· Costing the production.

· To make the efficient use of money of the company.

· Maintains all the accounts about inventory & imports of material.

· Maintains all the records about purchases made by organization.

ACCOUNT DIVISION:

Finance department maintains all types of accounts in the organization. Finance department records the transaction, design & implement the accounting system and prepares the financial statements for the company. This department is under the Finance Manager. The head of accounts department is called Comptroller of Accounts (COA). There is also Deputy Comptroller of Accounts(DCOA) who assists the Chief Comptroller of Accounts. Then there is one Assistant Comptroller of Accounts(ACO). There are 8 sections in the accounts division and in each section there is one in charge. The accounts division has computerized accounting process & linked with Management Information System. Following are the major sections of the accounts division:

a) Inventory Section

b) Sales Accounts Section

c) Purchase Section

d) Cash & Bank Section

e) Pay Roll Section

f) Excise & Tax Section

g) Import Section

1. Inventory Section

Inventory Section plays a very important role in any organization & is an important part of the Accounting Section. This section maintains all the record and accounts about inventory and imports of material. It is concerned mainly with the:

· Control of inventory

· Imports

· Investments

· Loans

· Accounting aspects of fixed assets

All store items laying in the stores of Packages Limited includes in inventory. Each item of inventory is recorded on BIN CARDS or TAGS. These provide an independent check on the store ledger. It is the duty of inventory section to know how much inventory is there in stores and for how long it is going to be kept.

This section also checks the value of all assets. Inventory section also reconciles the quantity of various assets with the help of store keeper to prepare the STOCK EVALUATION REPORT. Inventory valuation is based on the average principle because they believe that it is the best system. There are two main stores in Packages Limited.

2. Paper Store

3. Central Store

Central store is gain further subdivided into:

· General Store

· Electrical Store

· Civil Store

· Chemical Store

· Oil Store

· Medical Store

· Tools & spares Store

Inventory section also deals with the loans of the company. Packages Limited has the policy to finance all long term projects through loaning. Normally the Packages Limited gets long term loans from foreign institutions & banks.

Packages Limited invests its funds in some other profitable business opportunities. At this time Packages Limited sponsored its sister concern Milk Pak. Funds are also invested in National Investment Trust, National Saving Certificates, Defense Saving Certificates & WAPDA Bonds.

Documentation Used in Inventory Section

The Inventory Section deals with different types of documents such as:

· Issuance Requisition (IR)

· Store Transfer Note

· Goods Received Notes

· Store Evaluation Report

· Store Return Report

Principles followed by Inventory Section

Accounting principles followed by inventory section:

· Assets are depreciated at Straight Line Method.

· Issue requisition of goods received note is the source of information of inventory.

· Fixed assets are stated at cost less accumulated depreciation.

· Inventory evaluation is based on Average Method of Costing.

· Assets, raw material and other stocks are recorded.

Depreciation in respect of such assets is charged in annual installments so as to write off their year end book value over their remaining re-estimated useful lives.

b) Sales Accounts Section:

The sales account section maintains customer’s record and the sales records. Sales department is actually deals with the Marketing Department and assist the sales force about the financial aspects. Sales department deals with three basic documents. These documents are very important in the activities of Sales Section. These are:

· Order Confirmation

· Internal Sale Order (ISO)

· Dispatch Note (DN)

The actual procedure starts when the sales officer of Marketing Department gets an order from his clients. When a customer confirms an order, the Marketing Department issues an “Order Confirmation Slip”. The customer must sign the order confirmation. After the confirmation, another document is prepared which is called the “Internal Sales Order” which is used within the company. It is includes details such as the following:

· Purchase Order Number

· Product Code

· Quantity Ordered

· Rate Agreed

· Total Value of he Order

· Sales Officer’s Code

· Code of the Department where goods are to be manufactured

In case the goods to be manufactured and sold to the customer are taxable the code is also given. One copy of ISO sends to the Sales Section. All necessary information about the sale is mentioned on ISO. In ISO the customer number, terms of payments, art work charges if any, delivery terms and charges, quantity and description of the ordered product, rate and total value are included. The conditions about transportation such as:

· Freight on board Lahore

· Freight on Board

· Exit from Paper & Board Mill

are also mentioned on ISO.

The other document Dispatch Notes are prepared by the Dispatch Section, which exists in the Marketing Department. Dispatch Notes contains:

· Name of the customer

· Customer number

· Dispatch date

· Dispatched to

· Mode of transfer

· Destination code

Sales section convert this ISO into coding and then check coding with ISO’s and send this coding in computer section which enter this coding into computer. MIS department then send Edit Report to the Sales Section to check it. After checking this edit report it send back to computer section and get Invoice & Freight Debit Note.

Another job of the Sales Section is to pay customer’s claims. If there are any difference in the agreed quantity, quality or specifications the customer send a claim and is verified by the Area Marketing Manager. Then the Marketing Department sends a “Sales Return Note”, to the Planning Department and Accounts Department. A “Credit Note” is issued in favor of the customer. Sales are debited and the customer is credited, as the accounting entry. If transportation company is responsible then sales department issue Debit Note to the concerned company. All accounting process in the sales section are computerized.

A “Debit Note” is issued to the customer for the extra goods (more than the ordered) delivered. The customer is debited and sales are credited.

As a policy matter, Packages Limited prefers to deal with customers who pay in advance or against an LC for which the guarantee is provided by a bank. Insurance for the delivered goods is borne by the customer, but he can request for a notification to his insurance about the delivery of the goods. As for as exports are concerned, all export documents are also prepared by this section and so are the local LCs.

A record book containing all the current accounts of the company’s sales is also maintained and is called the “Account Current Ledger”.

The 10-Days Breakup Report

The sales section prepares a 10-days report for the management’s use, which contains details of the outstanding cash, receipts due from the customer. It contains all outstanding amounts. After studying this report, the sales officers made efforts to collect the outstanding amounts from their respective customers. The delay in received the amount can be caused due to several reasons. The sales officer dealing with the customer who delays his payments, is responsible for the collection.

c) Purchase Section

Packages Limited has its own Purchase Accounting section. This section normally deals with the records of all purchase made by Packages. In Packages Limited purchases are actually made by the Commercial Department but its accounts deal by the Purchase Section.

Purchase department also deal with different documents such as:

· Issue Requisition (IR)

· Purchase journal (PJ)

· Cash Voucher (CV)

· Purchase Journal Through Staff (PJS)

· Goods Received Note (GRN)

· Purchase Requisition (PR)

· Store Return Note (SRN)

· Store Transfer Note (STN)

The purchases section records all the daily purchases of company made by commercial division or any other department. The purchases made by Packages Limited may be on cash or Credit basis. Three types of purchases made by the company.

1. Purchase at the Gate or Cash Purchase:

Packages Limited purchase some goods against cash, it is known as cash purchase. The company buys raw material for paper like Wheat Straw, Kahi at the factory gate. These purchases are recorded in the purchase Journal. The gate clerk completes the purchase process and makes payments on spot.

2. Credit Purchases:

Some purchases of goods made on credit. Such types of purchases are done by authorized purchases of the company on the credit basis. Credit purchases are of two types:

· Against goods

· Against services rendered

Normally goods need for manufacturing purpose such as packaging machinery, chemicals etc. purchase on credit.

3. Local Purchase Through Staff:

commercial Department Staff members purchase this type of purchases. In this type of purchases cash is paid immediately. Such purchases are recorded in purchase journal through commercial staff and send it to the Purchase Section.

d) Cash And Bank Section

The staff of this section is assigned the job of making payments on behalf of the company. It receives checks and records them in the cash and bank book on daily basis. All the travelling allowance bills, petty cash expenses and monthly payments of salaries are made through this section this section operates under the delegated authority from the Comptroller of Accounts.

Operations of Cash & Bank Section:

· To maintain Cash Book

· The Management of Short Term Loans

· Payments in the Shape of Cheques

· Payments to the suppliers

· To check the Bank Reconciliation Statement

· Payments for Local Travelling

1. Cash Book:

The cash & bank section maintains a cash book in which details of all cash receipts and payments are noted. A daily balance is prepared after examining daily cash receipts and payments which is carried towards the next day as beginning balance of the next day. All receipts of the organization are recorded on the credit side and all the payments are recorded on the debit side.

2. Payments for Local Travelling:

Travelling within a radius of 50 km from Packages limited is considered as local travelling f or which traveling allowance is given to the employees. It is only given when an employee uses a mode of transport for official purpose.

3. Short Term Loans Management:

In Packages Limited loans are also given for the purchase of cars and motorcycles. The recommendations this regard is given by the departmental head and is finally approved by the Finance Manager. The payments are made by loaner on installments basis i.e., a part of his/her salary is deducted as installment. It is the Cash & Bank Section responsibility to maintains it. This section is also responsible for the management of all short term loans of the Packages Limited. Packages Limited is getting the banking facilities from about nine banks. In this regard this section normally seek the Bank Guarantees and Working Capital Loans in form of over draft facility. All the machinery in the Packages Limited is on leasing, so it is Cash & Bank Section duty to see the accounts of all things. The basic objective of this section is to finance the company’s operations in a better way.

4. Issuance of Cheque:

when payment is not made on cash, then the organization issues cheques to its creditors. The cheque issued has four copies. The original copy is sent to the creditor or supplier. One copy is kept for posting purposes. One other copy is sent to the sales department and the last copy is kept as a record. It is the job of Cash & Bank Section to reimburse all those expenses paid by the employees on behalf of the organization. Normally this payment is made twice in a month. All employees sends the details of the expenses incurred by them on the prescribed form. Cash & Bank Section pays the amount either on the 1^st day of the month or on the 15^th day.

5. Payment to the Suppliers:

One of the most important job of Cash & Bank section is to made payments to the suppliers for the goods or services which they provided to the company. The purchase section sends the bill indicating that the goods have been received and the payment should be made.

e) Pay Roll Section

This section deals with the salaries and wages of the employees working in the organization. There are two categories of employees:

· Working on hourly basis

· Working on monthly basis

The hourly paid employees are paid every fortnight whereas the other category receives the salary at the end of month.

COST & TAX DIVISION

Packages Limited is engaged in producing two types of products:

¨ Paper & Board

¨ Packaging Containers and Corrugated Cartons

Both products are costed differently, so these are two separate units for Paper & Board Mill Division.

Costing of Paper & Board Division:

Costing of Paper & Board Mill Division deals with process of costing. Paper & Board Mill produces one product with different quality and grammage and the production of Paper & Board is even, the manufacturing costs are calculated with help of process costing system. This method is particularly very helpful where unit’s produces are unidentifiable and one department’s finished goods becomes the raw material of another department. Cost per ton is determined at each process and it is figured out by dividing the total cost by the number of tons for a particular period.

To determine the exact cost, the manufacturing costs are calculated with sum of direct material, direct labor and factory overhead costs, also to see that for how long the machine worked and for how long it remained idle? So they prepare an hourly summary on which the total hours of work along with the idle time are mentioned. On the basis of this report, the actual cost of production is calculated. Costing Division also prepare the cost summary. The variable and fixed cost are shown separately in this cost summary.

This division also prepares a summary report of profit month wise. This report shows profit & loss of the organization for this month.

Functions of Paper & Board Costing Unit:

Paper & Board Costing Unit Performs the following functions:

¨ Provides information to management about the inefficiencies and wastage of Production.

¨ Provides necessary information to top management for decision making.

¨ Calculation of the cost of each product produced in the Packages Limited.

¨ Deals with Income Tax Department and prepare the tax reports.

¨ Estimates the operational costs of each department of the Packages Limited.

¨ Prepare short term and long term financial plans for production.

SWOT ANALYSIS OF PACKAGES LIMITED

STRENGTHS

1. Packages has its own Paper & Board Mill.

2. They are producing all types of paper and board packaging.

3. They are having the best positive image & reputation for quality packaging products in Pakistan.

4. They are having the most advanced sophisticated & up to date machinery in Pakistan and even in Asia.

5. Packages having their own Research, Development & Control department.

6. They have ISO 9001 quality assurance certificate.

7. They are having their own Power Generation Plant.

8. Well established in Pakistan.

WEAKNESSES

1. Cannot take small orders.

2. High prices.

3. Lack of motivation & intrinsic reward orientation among the management.

OPPORTUNITIES

1. Market for Packaging Industry is growing day by day.

2. Quality awareness & consciousness among the customers are increasing.

THREATS

1. Mushroom industry is increasing.

2. Products of mushroom industry are cheap.

SUGGESTIONS

During studying the different departments of Packages Limited, we conclude that it is an excellent organization. Both the packaging and consumer products are the market leaders. Apart from its excellent operations, it does not tend to be stationary at one point. The Top Management keeps on exploring the profitable opportunities both at home and abroad collaboration wit “Coates Lorilleux” and “Mitsubishi Corporation of Japan” are the examples. Although it is quite difficult to suggest some thing to such an established organization but I put my efforts to suggest in the following lines:

¨ There is lack of information literature about the Packages Limited. There is no informative book or material in the Packages library for new comers or internees and it is very difficult for internees to get accurate and complete information.

¨ They can more enhance the image of their company by entering into the field of public relations. If they let the public know their plans and operations, it can be hoped that the people will consider the organization with a sense of still greater esteem and this can add to the growth of their consumer products.

¨ In Packages Limited, some departments are decentralized but still there is a need of more decentralization in some departments.

¨ Although the management has given many attractive incentives to the employees, but there is a need of worker’s colony in Packages Limited.

¨ There is lack of motivation in to Industrial marketing Department. The Sales Officers are not as motivated as it should be. In fact, they have little interest in getting new customers. For this, I think some sort of benefits should be given to the Sales officers.

¨ I found during my internship program that there is no person in Packages Limited to give the orientation to the new employees and internees.

¨ An unsound advertising strategy is followed by the Packages Limited. The advertising budget should be increased and it would be better if an advertising department is opened.

¨ Consumer Product Department is producing disposable cups and plates, but they are not promoting these products. They should educate consumers about these products with an effective promotional programs.

¨ As the training procedures are also very important to have qualitative people on their job, special emphasis should be laid on to the management development part of the training programs.

Packages Limited is leading packaging manufacturing company of Pakistan. It was not an easy job for internees to study the complete working of this organization within six weeks. I think one need allot more time to study such a versatile type organization. It was very difficult for the internees to manipulate all sort of information about Packages Limited. This internship program was very fascinating experience for me and during my stay at Packages Limited, I learned so many things. So it was the best time for me to see the application of the theoretical frame work studied by me in the MBA(MIS) classes in practical fields.

In the end I think the future prospects of the Packages Limited are quite bright. It will grow and advance more and more wit time.

References:

www.packages.com.pk/

www.packages.com.pk/globalpartners.htm

www.kellysearch.com/pk-company-370041796.html

oliath.ecnext.com/.../product-compint-0000951810-page.html

www.paktive.com/Packages-Ltd_168SC14.html

www.linkedin.com/companies/packages-limited

investing.businessweek.com/research/stocks/.../snapshot.asp?

www.corporateinformation.com/Company-Snapshot.aspx?

www.arabianbusiness.com/financial-markets/companies/641/profile

Internship Report on Packages Ltd.
by Commerce Solutions in Internship Report

ORGANIZATION CHART OF

PACKAGES LIMITED

COMPANY INFORMATION

BOARDOFDIRECTORS ASADULLAH KHAWAJA

ADVISOR

COMPANY SECRETARY

AUDITORS

LEGAL ADVISORS

BANKERS

REGIONAL SALES OFFICE

ZONAL SALES OFFICE

Time and Date

Internship Report on Packages Ltd. by Commerce Solutions in Internship Report

ORGANIZATION CHART OF

PACKAGES LIMITED

COMPANY INFORMATION

BOARDOFDIRECTORS ASADULLAH KHAWAJA

ADVISOR

COMPANY SECRETARY

AUDITORS

LEGAL ADVISORS

BANKERS

REGIONAL SALES OFFICE

ZONAL SALES OFFICE

Time and Date

Internship Report on Packages Ltd.
by Commerce Solutions in Internship Report