MBA Thesis

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Table of Contents
INTRODUCTION ............................................................................................................................................. 4 Rational of Study ....................................................................................................................................... 4 Research Objectives .................................................................................................................................. 4 Problem Identification .............................................................................................................................. 5 Theoretical Framework ............................................................................................................................. 6 Development of Hypotheses .................................................................................................................... 6 Methodology............................................................................................................................................. 7 Research Plan ............................................................................................................................................ 8 COMPANY PROFILE ..................................................................................................................................... 10 BORJAN LOOK ............................................................................................................................................... 3 VISION STATEMENT ...................................................................................................................................... 4 MISSION ........................................................................................................................................................ 4 OBJECTIVES ................................................................................................................................................... 5 PRODUCTS AND SERVICES ............................................................................................................................ 6 Brands for Gents ........................................................................................ Error! Bookmark not defined. Brands for Ladies........................................................................................ Error! Bookmark not defined. Accessories ................................................................................................. Error! Bookmark not defined. GENERAL ORGANIZATIONAL STRUCTURE ...................................................... Error! Bookmark not defined. STRUCTURE OF DEPARTMENTS ..................................................................... Error! Bookmark not defined. Merchandising Department ...................................................................................................................... 9 Wholesale Department ............................................................................................................................. 9 Product Development Department ........................................................................................................ 10 Gents ................................................................................................................................................... 10 Ladies .................................................................................................................................................. 10 Retail Shops Department ........................................................................................................................ 11 Planning and Budgeting Department...................................................................................................... 11 Information Technology Department ..................................................................................................... 12 Accounts and Finance Department......................................................................................................... 13 Distribution Department......................................................................................................................... 14

ORGANIZATIONAL HIERARCHY ................................................................................................................... 15 REGIONAL STRUCTURE OF BORJAN ............................................................................................................ 15 Central Region......................................................................................................................................... 15 North Region ........................................................................................................................................... 15 South Region ........................................................................................................................................... 15 SWOT ANALYSIS DONE BY THE ORGANIZATION ......................................................................................... 16 Strengths ................................................................................................................................................. 16 Weaknesses ............................................................................................................................................ 17 Opportunities .......................................................................................................................................... 18 Threats .................................................................................................................................................... 19 PLANNING ................................................................................................................................................... 21 Decentralized Decision Making............................................................................................................... 21 Strategic Objectives ................................................................................................................................ 22 Corporate Level Objectives ..................................................................................................................... 22 Business Principles .............................................................................................................................. 22 Strategic Planning ................................................................................................................................... 23 Business Level Objectives ....................................................................................................................... 23 Organization’s Policies ............................................................................................................................ 23 Equal Opportunity ............................................................................................................................... 23 Car Policy............................................................................................................................................. 24 Travel and Expenses ............................................................................................................................ 24 Salary Disclosure ................................................................................................................................. 24 Insurance ............................................................................................................................................. 24 Rules and Regulations ............................................................................................................................. 24 Personnel Records .............................................................................................................................. 24 Attendance.......................................................................................................................................... 25 Work Hours ......................................................................................................................................... 25 Employee ID Cards .............................................................................................................................. 25 Dress Code .......................................................................................................................................... 26 Smoking............................................................................................................................................... 26 Use of Company Property ................................................................................................................... 26 Public Holidays .................................................................................................................................... 26

ORGANIZING ............................................................................................................................................... 27 Departments in Borjan (Pvt.) Limited ..................................................................................................... 27 Merchandising Department ................................................................................................................ 28 Retail – Shops Department ................................................................................................................. 28 Wholesale Department ....................................................................................................................... 29 Marketing Department ....................................................................................................................... 30 Accounts and Finance Department..................................................................................................... 31 Research and Budgeting Department ................................................................................................. 36 Replenishment Department ............................................................................................................... 36 Administration Department ................................................................................................................ 36 Information Technology Department ................................................................................................. 37 Product Development Department .................................................................................................... 38 Human Resources Department........................................................................................................... 39 Central Warehouse Department ........................................................................................................ 40 Customer Care Department ................................................................................................................ 40 STAFFING..................................................................................................................................................... 41 Recruitment Sources ............................................................................................................................... 41 Recruitment Sources in Head Office ................................................................................................... 42 Recruitment Sources in Retail Outlets ................................................................................................ 44 Recruitment Process ............................................................................................................................... 44 Termintion Policies ................................................................................................................................. 47 LEADERSHIP................................................................................................................................................. 48 Leaders of Borjan (Pvt.) Limited.............................................................................................................. 49 Board of Directors ................................................................................................................................... 49 Key Management .................................................................................................................................... 50 Employees Benefits Programme ............................................................................................................. 51 Training and Career Development Programme ...................................................................................... 53 CONTROLLING ............................................................................................................................................. 55 Performance Appraisal ........................................................................................................................... 55 Corrective Disciplinary Action ................................................................................................................. 56 Internal Audit .......................................................................................................................................... 57 COMPETITORS’ COMPARATIVE ANALYSIS .................................................................................................. 58

Stylo Shoes .............................................................................................................................................. 58 Bata ......................................................................................................................................................... 59 Urban Sole............................................................................................................................................... 60 Hush Puppies........................................................................................................................................... 60 Imperial Shoes......................................................................................................................................... 61 Comparison of Goals and Strategies ....................................................................................................... 62 Financial Comparison .............................................................................................................................. 65 SWOT ANALYSIS BY RESEARCHER ............................................................................................................... 67 Strengths ................................................................................................................................................. 67 Weaknesses ............................................................................................................................................ 68 Opportunities .......................................................................................................................................... 69 Threats .................................................................................................................................................... 70 THEORIES IMPLEMENTATION ..................................................................................................................... 72 Marketing Mix ......................................................................................................................................... 72 Product ................................................................................................................................................ 72 Pricing.................................................................................................................................................. 73 Place .................................................................................................................................................... 73 Promotion ........................................................................................................................................... 74 PEST ANALYSIS ............................................................................................................................................ 74 Political Factors ....................................................................................................................................... 74 Economic Factors .................................................................................................................................... 74 Social Factors .......................................................................................................................................... 75 Technological Factors.............................................................................................................................. 75 FINDINGS AND DATA ANALYSIS .................................................................................................................. 76 COMPANY’S FEASIBILITY REPORT ............................................................................................................... 97 SUGGESTIONS AND RECOMMENDATIONS ................................................................................................. 99 BIBLIOGRAPHY .......................................................................................................................................... 101 APPENDIX .................................................................................................................................................. 102

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INTRODUCTION
Rational of Study
This study has been conducted with the aim of conducting an in depth managerial analysis of Borjan (Pvt.) Limited. The five managerial functions are discussed in detail. Firstly the planning function is studied and the vision, mission statement and goals are seen and how plans and strategies are developed in the light of this. Next the structure of the organization is explored and the role and working of the different departments is analyzed. Thirdly the process of recruitment starting from advertising of vacancies to hiring and then career development of employees is studied. The qualities of the leaders of Borjan and their style of management are discussed next. The employees benefit programme and its major features are also analyzed. Next the control process is discussed and the management’s checks and controls over the employees and activities are explored. The competitors’ comparative analysis is conducted and the position of Borjan in the market is seen. In light of this study SWOT analysis has also been carried out.

During the detailed analysis of the company one of its major problems has been identified along with possible reasons and their validity is checked. The report also suggests some solutions for resolving this problem. Lastly the company’s feasibility report is presented.

Research Objectives
The main objectives of this research study are  To conduct an in-depth managerial analysis of Borjan (Pvt.) Limited

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To identify one major problem faced by the company and check the validity of the possible reasons.



To make suggestions for rectification of this problem based on the analysis.

Problem Identification
The problem that has been identified through the course of this research is “Slow Receivables Turnover.”

Receivable turnover ratio is an activity ratio which measures the number of times, on average; the receivables of the company are received during a year. The higher the ratio, the greater number of times the receivables are received. Quick collection of accounts receivables is very important for a company because the longer it takes to collect outstanding receivables; the more likely it is that the account may never be paid. Receivables also tie up cash which means there is less money available for use in operations, paying dividends, or for other investing activities. Thus it is in the best interest of companies to speed up their receivables collection.

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Theoretical Framework
Creditwo rthiness of Custome rs Slow Business Activity Training of Sales Staff Banking Infrastru cture Length of Collectio n Float

Slow Receivable Turnover

Development of Hypotheses
Hypothesis: 1 H0: Customer creditworthiness and receivable turnover are independent. H1: Customer creditworthiness and receivable turnover are dependent.

Hypothesis: 2

H0: Slow business activity and receivables turnover are independent. H1: Slow business activity and receivables turnover are dependent.

7 Hypothesis: 3

H0: Training of sales and recovery staff and slowness of receivables turnover are independent. H1: Training of sales and recovery staff and slowness of receivables turnover are dependent.

Hypothesis: 4

H0: There is no relationship between infrastructure problems of the banking sector and receivables turnover. H1: There is a relationship between infrastructure problems of the banking sector and receivables turnover.

Hypothesis: 5

H0: Length of collection float and company’s receivables turnover are independent. H1: Length of collection float and company’s receivables turnover are dependent.

Methodology
In order to achieve the above stated objectives data has been collected from various sources. Secondary data from the company’s official website has been taken into consideration for getting basic information about the company and its products and services. The head office of Borjan located in Johar Town, Lahore was visited and the working environment was observed. Interviews were conducted with the chief executive officer, chief operating officer and departmental heads to understand the departmental processes.

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In order to check the validity of the possible reasons for the problem of slow receivables turnover identified a questionnaire was developed and employees from the wholesale department and finance department were asked to fill it. Finance and wholesale departments were chosen because only these departments are responsible for dealing with the receivables arising from wholesales. Finance department is responsible for creating reports on those dues which have become due or overdue. Then the wholesale department works on making recoveries and collections of the receivables. The computer software programme SPSS (Statistical Package for Social Sciences) has been used to quantify the responses of the employees and check the validity of the hypotheses. Sampling techniques could not be used for analysis purpose because the target audience for the questionnaire developed consists of only 20 employees owing to limited number of the staff in the finance and wholesale department of Borjan.

Research Plan
The research plan for conducting the study is as follows  An in-depth managerial analysis has been conducted through observation of the different departments working in Borjan and interviewing and interacting with the higher officials   SWOT analysis has been conducted. On the basis of the analysis slow receivables turnover has been identified as the major problem faced by Borjan.  To understand the possible causes of the problem a questionnaire was developed and made to fill by the employees of the finance and wholesale department.

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SPSS has been used to analyze the feedback from the employees and to accept or reject the hypotheses developed.

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IN-DEPTH MANAGEMENT ANALYSIS OF BORJAN (PRIVATE) LIMITED

COMPANY PROFILE
PEL is the pioneer manufacturer of electrical goods in Pakistan. In 1956, the Company was set up between Malik Brothers in technical collaboration with M/s AEG of Germany (“AEG”) to manufacture transformers, switchgear, and electric motors. AEG exited from the venture and sold their share of PEL to the Malik Brothers in the late 1960s, which was subsequently acquired by the Saigol Group of Companies (“Saigol Group”) in 1978. Until the acquisition by the Saigol Group, PEL was solely catering to the power equipment market. The Company ventured into home appliances market in 1981 after acquisition as a part of the Gro up’s long term strategy of diversification. PEL is comprised of two divisions   Power Division Appliances Division

The Power Division manufactures energy meters, transformers, switchgears etc. In addition, the power division has diversified its business through the development of grid stations and has established itself as a major player in the construction of 132KV grid stations on EPC basis. The Appliances Division manufactures split air conditioners, refrigerators and deep freezers. It performs appliance trading function and distribution of LG appliances

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Pak Elektron Limited Power Division Appliances Division

Transformers

Energy Meters

Switch Gears

EPC Projects

Refrigerators

Split A/C

Trading

LG Appliances

Ffdfd

Acquired technology from Ganz, Hungary in 2004 to produce power transformers Agreement signed with Pauwels, Belgium in 2005 to produce distribution transformers

PEL established in 1956

PEL starts manufacturing of air conditioners with the assistance of Fujitsu, PEL signs agreement with ABB, USA in Japan in 1981 1992 to manufacture energy meters

1950 1970 1980 1990

1960

2000

2009
Distribution Agreement signed with LG. PEL will be the sole distribution of LG’s home appliances

Technical collaboration agreement reached with AEG Germany in 1958

Acquired license to manufacture VCBs from Hitachi, Japan in Acquired technology from Carrier, USA to 1988 manufacture window A/C in 1997

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Borjan is a leading fashion footwear retail company which started its operations in 1996. Borjan is into designing and retailing of shoes through its own retail and partner retailer networks with the aim to provide exceptional shoes at competitive prices. Today Borjan has 58 retail outlets in 36 cities of the country and sells approximately 700,000 pairs of shoes annually in addition to selling its shoes to 68 independent shoe retailers. The spacious retail outlets provide best value for a wide assortment of fashionable, elegant and comfortable shoes for both gents and ladies. Customer service is fast thanks to a self selection shopping environment with qualified staff to serve and assist.

With the company’s commitment to luxury and style, innovation and technology have been brought together along with skills. The rigid control manufacturing process is not merely an advertising slogan rather it is believed to be the necessary process to build footwear that withstands the test of time and defines customer satisfaction.

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The management of Borjan believes that shoes should represent one’s personality and has spent a lot of time and resources to bring beautifully crafted, cutting-edge, urban, fashionable footwear to the customers. Borjan represents a select group of hip designers who feel that shoe making is an art and their creativity can be seen in each style and design that they create.

Borjan takes pride in having launched the highest number of sole designs in Pakistan. Such achievements have been made possible only through the continuous heavy investment in research and development that aims to bring the best of fashion from Europe and Asia to the country.

Over the years Borjan has been successful in establishing itself as a world-wide manufacturer of private label and branded footwear at affordable prices and is now ranked among one of the best shoe retailers in the country.

BORJAN LOOK

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Borjan uses a colorful, bright yet simple and elegant logo to communicate its values to its customers. The positioning line used by Borjan is “fashion forward”

VISION STATEMENT
“To become a leading organization not only in Pakistan but also in its neighboring countries so that our brands and utility products become the first choice of our consumers to make them look and feel smart.”

MISSION
       To prioritize and look after our customers To do the best with honesty To care for our own people To give back to the society To build strong relationship with consumers, vendors and employees To enhance respect factor amongst us Business innovations

Brand values at Borjan (Pvt.) Limited are:

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Fashion – We want to provide the latest of fashion from Europe and Asia to our customers. Our shoes are a perfect merge of fashion, elegance and comfort. Affordability – We strive to provide our customers shoes for every occasion at affordable and competitive prices. Honesty – We do our work sincerely with a sense of responsibility. We say what we do and we do what we say. Friendliness – We believe in working together in a friendly environment to yield success for all our stakeholders. We consider and try to fulfill the demands of our customers and each other.

OBJECTIVES
In order to provide great value and best possible service to the customers, Borjan emphasizes on the following two core objectives:   Product concept development Constant improvement of business processes

Goals at Borjan are always:  Written: A written goal gives the employees a clear direction of what needs to be done for the success of the company. Furthermore there is no chance of misunderstandings and miscommunication with goals that are in writing.

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Specific: Borjan management always sets goals that are specific in scope so that employees clearly know what exactly the management expects from them. This helps the employees to perform better.



Time Sensitive: A goal is not a goal unless there is time attached with it for the completion of the goal. Realizing this factor goals at Borjan are always time framed so that there is no procrastination.



Measurable: The set goals are always measurable so that the Borjan management can assess the performance of employees in accomplishment of the goals and can make changes in the line of action for future.

PRODUCTS AND SERVICES

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ORGANIZATIONAL STRUCTURE
Chairman

Managing Director

Chief Financial Officer

GM Manufacturing
(Power Division)

GM Marketing (Power Division)

GM Manufacturing
(Appliance Division)

GM Marketing
(Appliance Division)

Chief Technical Officer

Senior Manager Marketing
(Appliances Division)

Senior Manager Marketing
(Power Division)

Senior Manager Quality Control
(Appliances Division)

Senior Manager Quality Control
(Power Division)

Senior Manager HR & A

Senior Manager B&IA

Manager Commercial

Manager F.P.

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Senior Management:       Mr. Haroon Ahmad Khan Mr. M Zeid Yusuf Saigol – Director Export & Power Project Division Mr. Syed Manzar Hasan - Chief Financial Officer Mr. Sheikh Muhammad Shakeel – Company Secretary MR. Muhammad Raza Khan - G.M. Manufacturing (Power Division) MR. Aftab Ahmed - G.M. POWER PROJECTS (Power Division)

Merchandising Department
Manager Merchandising Deputy Manager Merchandising

Merchandiser

Quality Checker

Coordinat or

Wholesale Department
Manager Wholesales

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Officer Sales

Coordinator Wholesales

Product Development Department
Gents Manager Development (Gents)

Designer (Gents)

Developer Shoe Sample (Gents) Quality Checker (Gents)

Officer Shoe Development (Gents)

Ladies Manager Development (Ladies)
D.M Development

Senior Designer

Merchandis er

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Designer

Quality Checker

Junior Designer

Retail Shops Department
Country Manager Sales & Marketing

Brand Manager

Group Shop Manager

Shop Auditor

Shop Manager

Virtual Merchandiser

Officer Marketing

Cash ier

Asst. Sales Advis or

Windows Decorato r

Planning and Budgeting Department
Manager Planning & Budgeting

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Officer

Information Technology Department

Manager IT

Dot Net Developer

Programmer Oracle Officer IT

Administrator Windows System

Officer Network Support

Asst. Officer IT

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Accounts and Finance Department
Manager Accounts

Deputy Manager Accounts

Stock Accountant Senior Officer Accounts Internal Auditor Asst. Officer Accounts

K.P.O

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Distribution Department
Distribution Manager

Senior Incharge C.W.S

Officer Replenishm ent

Supervisor Quality

Officer C.W.S

Officer Logistic

Asst. Officer Replenishm ent

Asst. Officer Receiving

Asst. Officer Dispatch

K.P.O

Quality Checker Claim Clerk

Helper

Packer

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ORGANIZATIONAL HIERARCHY

Chief Executive Officer Chief Operating Officer Senior Managers Managers Deputy Managers Assistant Managers

REGIONAL STRUCTURE OF BORJAN
Central Region
This region covers Lahore, Gujranawala, Faisalabad, Jhelum and Multan. Head office of Borjan is located in Lahore.

North Region
It covers Islamabad, Rawalpindi and Peshawar.

South Region
The south region covers Karachi, Quetta, Hyderabad and Sukkur.

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SWOT ANALYSIS DONE BY THE ORGANIZATION
Strengths
Efficient Management Borjan’s management is very efficient and experienced and has the expertise required for the success of the company. The company’s chief executive officer was the ex -director of Service Industries Limited and is a very visionary person.

Steady Business Policy The management of Borjan follows a steady business policy and does not over burden itself with loans for expansion.

Decentralized Decision Making The decision making process at Borjan is decentralized where departmental managers are given the authority to make decisions related to their departments. This management style improves the efficiency of the company and decisions are made by those who have the best knowledge about local conditions.

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Custom-Designed Retail Outlets Though the company does not own any of its retail outlets yet there is a separate department that on renting a new space for an outlet customizes its to give the customers an out of the world buying experince.

Extensive Retail Network Borjan has established an extensive retail network and is currently operating in 23 major cities of the country through 58 outlets.

Weaknesses
Brand Awareness Borjan is not a very well known brand amongst people and there is not much loyalty for its products.

Reliance on Cottage Industry Borjan has to interact with cottage industry for production of some of its products and thus exposed to the vulnerability associated with this sector.

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Focus on Marketing Orientation Borjan is still focusing more on sales orientation and needs to shift to the marketing orientation in face of the changing social structure of the economy.

No Manufacturing Units Borjan does not own any manufacturing unit and has to get all its products manufactured from other vendors. In this case the company can not be fully assure of the quality despite heavy checks on the manufacturers.

Untrained Sales Staff The company does not have a proper training process for the sales staff which usually results in incompetence and lack of proper information about the products.

Opportunities
Entering the International Market Borjan is concentrated in a few cities in Pakistan and does not have an international presence. Expanding internationally can be very fruitful for the company.

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Growing Demand for Shoes Pakistan’s population is growing at the rate of 2.25% per annum which means the demand for shoes is continously increasing.

Changing Social Values The social values of the nation are changing and people are inspired by Western styles and want to adopt them. The supply of such footwear is still limited in the country and can be cashed upon.

Improving Shopping Experience Though Borjan is spending a lot on its retail network still there is room for improvement by training the staff and properly stocking the retail outlets.

Threats
Energy Crisis The current energy crisis is posing a great threat both at the manufacturing and retail level and is pushing the cost of production and sales up.

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Cheap Competition from China China is dumping cheap shoes into Pakistan which are serving as perfect substitutes to local brands and people are shifting towards these Chinese products to save money.

Stiff Competition from Local Competitors Borjan is facing stiff competition from other local shoe retail networks in the country who are following an aggressive policy and expanding rapidly. Furthermore market leaders like Bata are outsourcing their shoe production to China thus slashing prices and creating problems for others.

Unbranded Small Players Many unbranded small players have started operating on local levels which though provide low quality products but being cheap they are capturing quite a large audience.

Recession The economy is in recession which has badly affected the purchasing power of the people.

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ORGANIZATION’S MANAGERIAL FUNCTIONS

PLANNING
Planning is the first managerial function in any organization which may be defined as “ The process of setting goals, developing strategies and outlining tasks and schedules to accomplish goals”.

Decentralized Decision Making
Borjan (Pvt.) Limited is a modern organization with a visionary and able management which realizes the importance and benefits of decentralized decision making. Keeping this in mind the management has put in a lot of effort to develop such an organizational culture which requires centralization only for extreme situations. The benefits of decentralized decision making to Borjan include:    Decisions are made by those who have the most knowledge about local conditions Managers have more control over results Greater managerial input in decision making has a desirable motivational effect

Departmental heads are given authority to make operational decisions with the consent of their subordinates. However in case of decisions that are of critical nature the heads can consult the chief operating officer.

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Strategic Objectives
Strategic objectives are broadly defined targets that an organization must achieve to make its strategy suceed. Strategic objectives at Borjan are externally focused and fall into eight main categories:   Increased market share both in terms of existing and new markets Innovation for improved quality of products and development of improved skills and methods to supply them       Broader or more attractive product line Improvement in selection and capacity building of human resources Achievement of measurable financial well-being and growth Building a strong reputation among the customers and becoming their first choice Increased productivity Awareness and responsiveness to the effects on the wider community of stakeholders

Corporate Level Objectives
Business Principles

Borjan works hard to maintain proper business principles and ethics which are in the best interest of employees and organization and also help in the accomplishment of company’s goals. Business principles are properly documented to inaculate an organizational cutlure based on honesty and trust.

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Strategic Planning
Strategic plans are made and structured by chief operating officer and senior managers in accordance with the chief opertaing officer while managers, deputy managers and assistant maangers are responisble for making and structuring operational plans.

Business Level Objectives
Business level objectives of Borjan (Pvt.) Limited include increasing the total market share by identifying gaps within the exisitng markets and introduction in new markets outside the country in Middle East and Far East. Improving the designs, quality and comfort of shoes also remains a priority for Borjan. In order to achieve its business objectives Borjan’s strategy is to     Increase product quality Introduce more varieties of shoes and accessories Competitive prices Superior customer service

Organization’s Policies
Equal Opportunity

Borjan (Pvt.) Limited is an equal opportunity employer and willing to extend employment to all individuals without regardance of sex, race, religion, color,creed, nationality , age and disability.

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Car Policy

Borjan provides all eligible employees with cars and a monthly fuel allowance to facilitate them for both official and personal use.

Travel and Expenses

The management is totally responisble for all expenses related to employees’ travelling such as booking tickets, hotel accommodations and car rentals etc. To ensure cost effectiveness air tickets are bought through authorized agencies approved by the company.

Salary Disclosure

Disclosure of salary information to anyone be it within the company or outside the company is strictly prohibited. Non adherence to this rule can result in strict disciplinary action.

Insurance

Borjan has gotten both life and family insurance for its employees from EFU.

Rules and Regulations
Personnel Records

Borjan maintains up to date and detailed records of all the employees. The records are kept by the human resource department and the accounts department. In addition to this all employees are instructed to promptly notify the company in case of any change in name, address and telephone number etc.

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Attendance

Employees are expected to be at their work stations at the scheduled start time. All leave applications must be submitted in advance except in case of serious emergency or sick leave. The break down of the allowed holidays is as follows: Annual Leave ------- 14 Casual Leave ------- 8 Sick Leave ------- 10

Employees who have to go out on business must seek permission and approval from their line managers however they may define their own business hours according to their need on such occassions. Employees must also inform their line managers if they are going to be late for office.

Work Hours

Work hours are from 9:00 am to 5:00 pm from Monday through Saturday. Employees are entitled to one hour lunch break from 1:00 pm to 2:00 pm which may be conditional to job requirements. On Friday lunch and prayer break is from 1:00 pm to 2:30 pm.

Employee ID Cards

Identification cards are issued to all employees by Borjan which indicate the employee number, name, designation and picture. The employees are required to display their ID cards at all times during work and the card must be returned to Borjan when an employee leaves the organization.
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Dress Code

Employees are required to be professionally dressed when inside the office or representing Borjan outside.  Male members of the head office and sales department are to dress formally i.e. dress shirts, dress pants and dress shoes.   Shalwar qameez are allowed to be worn on Fridays. Male members of the retail outlets must be properly dressed in clean uniform provided by Borjan.  Female employees must be properly dressed with dupattas at all times.

Smoking

Smoking is strictly prohibited within the head office and all retail outlets.

Use of Company Property

All company property provided by Borjan must be used for business purpose only. Laptops and other work equipment can not be taken away from the office unless approved or a need of the job specification. The copying or transfer of any program or file from company computers is also not allowed.

Public Holidays

Employees are entitled to all public holidays declared by the Federal Government of Pakistan.

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ORGANIZING
Organizing is the second managerial function which may be defined as “ The process of determing what tasks are to be done, who is to do, how the tasks are to be grouped, who reports to whom and where decisions are to be made.”

Departments in Borjan (Pvt.) Limited
A total of 13 departments are functioning in Borjan which are: 1. Mechandising 2. Retail – Shops 3. Wholesale 4. Marketing 5. Accounts and Finance 6. Research and Budgeting 7. Replenishment 8. Administration 9. Information Technology 10. Product Development 11. Central Warehouse 12. Customer Care 13. Human Resource

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Merchandising Department

Borjan doesn’t manufacture any of its products on its own. Rather they get them manufactured from various vendors. The merchandising department is responsible for this purchase. All the purchasing is done locally and is done from the following sources:    Semi-mechanized units Mechanized units Cottage industry

Mechanized units remain the largest source of merchandising and 90% of shoes come from this source. The usual credit period for purchase of shoes is 60 days however when dealing with very small scale units in cottage industry the credit period is of 30 days because these units have very little resources and need quicker payments to sustain.

The purchase of accessories is also taken care by the merchandising department. Accessories include handbags, belts, wallets, socks, cuff-links and studs. All these things are also bought from vendors within Pakistan.

Retail – Shops Department

The retail-shops department oversees all matters related to retail outlets of the company. First of all the department identifies the areas in which new outlets can be opened based on where there are customers for Borjan products. Then the department oversees the opening of new outlets and then manages the supply of products to these outlets.
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Wholesale Department

The wholesale department has a team of 7 sales officers and 2 sales coordinators. The final products come to this department which then sell them to well known and independent retailers across the country for sale. These retailers are not linked with Borjan. Borjan sells its products to 78 retailers across the country and 5 retailers in Afghanistan. The retailers are then given a percentage of the profits. When a new retailer shows interest in becoming a reseller the wholesale department conducts a detailed survey on the reputation of the wholeseller and checks if there is enough clientele for Borjan shoes and accessories. The credit terms for wholesellers range from 15 to 60 days. The credit terms depend upon the reputation, relations and quantum of sales of the wholeseller. For new wholesellers the credit term is usually short. The wholesale department has divided the country into seven regions which are:       Rawalpindi Region ( including Afghanistan) Kashmir Region Lahore Region (from Lahore to Jhelum) Multan Region (Lahore to Rahim Yar Khan to Sukkur and Interior Sindh) Karachi Region (Karachi to Quetta and Hyderabad) Faisalabad Region ( including South Punjab)

Each of the regions is overseen by a sales officer. The sales coordinators are responsible for disptaching the stock under their supervision. Internally they are also responisble for interacting with the sales team and merchandising department.

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Marketing Department

The marketing department is a research-oriented department which is responsible for handling the brands and promotions of the company. The marketing head alongwith his team of 3 members promote the company on a multitude of platforms. The department oversees the official Borjan site (www.borjan.com.pk), designing of advertisements, brochures, signs and anything else that gets the word out about the company.

At the start of each fiscal year the marketing department makes its annual budget and gets it approved from the finance department and the chief operating officer. After the approval of the budget the department divides the amount on a monthly basis to support its spending and prepares a detailed calender of the activities to be conducted during the year.

Another very important duty of the marketing department is to coordinate with Manhattan Leo Burnett, the advertisng agency hired by Borjan for its creative end. About 45 to 60 days prior to the start of any activity (such as seasonal sales etc.) the marketing department contacts the agency which then comes up with ideas and launches creatives for the marketing team to approve. The creatives are then introduced to a selected target audience to see if they are attracted by them or not. The approved creatives are then launched on a mass scale. The task of the marketing department does not end here rather at this stage it evaluates the results for future marketing strategies.

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Borjan has sponsored events in the past but does not anymore because the management does not believe in advertising just for the sake of advertising. Furthermore sponsorship of events is not very profitable.

Accounts and Finance Department

There are four modules working in the accounts and finance depratment     General Ledger Accounts Receivable Accounts Payable Inventory Management

General Ledger The company uses an accounting software Microsoft Dynamics AX 2009 which is an off the shelf software for retailers. The version used by Borjan is for ready business retailers. The general ledger account of the company is linked with the accounts receivables and payables and there is no direct posting in this account. Another tool used by the finance department is FRX reporting which pulls data from AX 2009 and generates reports. FRX segregates the general ledger on the following 3 basis    Department Cost Centre Purpose

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Each ledger can be reviewed on the above basis. However only one can be used at a time. For decision making purposes each ledger must be reviewed on the basis of at least 2 criteria which usually are department and cost centre. Purpose is used for vehicles and expenses related to human resources.

Accounts Payable The operating cycle of the company is not fixed because it has a seasonal business. The cycle becomes very effcient at the start of the season and comes to about 60 days. It becomes slower during other times of the year and also varies from shop to shop.

A daily basis recording of the company’s accounts payables is done. When stock is received and is still uninvoiced it is posted in the the general ledger pool. However after receiving of invoice it is posted to the relevant ledger account. The due date for payment of accounts payable is considered from the receiving date of the stock. The company has always paid its payables on time. The company might also make payment before the due time to some suppliers based on its relations with them and quantum of purchase.

Accounts Receivables Accounts receivables of the company are generated through two sources  Retail Outlets

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Wholesales

The retail outlets are instructed to remit the daily sales amount to the head office on opening of the shop on the next working day. The remittance channels used are   Allied Bank Limited United Bank Limited

The transfers can be made online or through demand draft. Though online mode of transfer is preferred still due to the common problems in infrastructure demand draft mode can be used. The advantage of using online transfer is that the funds become available to the head office the same day whereas a 2 days gap comes in case of demand draft.

Borjan allows the retail outlets to use money for petty expenses such as payment of salaries less than Rs.10,000 and shops miscellaneous expenses such as salaries of sweepers, night guards, repair and maintenance, courier and photocopy, entertainment, air freshners and insect repellents etc.

Accounts receivables are also generated by the wholesale side. The finance department makes an aging report for the receivables and the daily dues are emailed to the wholesale department.

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Weekly meetings are conducted between the finance and wholesale departments where dues are discussed by region and party wise. Usually these meetings are held on Tuesdays.

The finance department makes another report on those parties whose dues have become overdue by 30 days and sends it to the wholesale department. The wholesale department then works for recovery of these dues under supervision of finance department.

Inventory Management Finance department is also responsible for inventory management. Periodically the inventory is monitored on the following two criteria   Valued inventory Cost of sales

The basis used is the weighted average. After the inventory monitoring the department makes a reconciliation with the general ledger though there is not much need because of the integrated system established from the use of AX 2009.

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Financing Structure of the Company The company does not invest in its retail outlets. All outlets are company operated but on rent. The financing is required for the following 2 purposes which are   Leasing of vehicles and in future IT equipment Working capital requirements

The leasing is done from the following banks    Askari Leasing Allied Bank Limited Habib Metropolitan Bank

Working capital requirements are fulfilled from United Bank Limited. The credit limit the bank has given to Borjan is 20 million. More funds are needed during the buying season. The next buying season will start in March. During the other months of the year the company usually has a borrowing of 2 to 3 million and has surplus funds. The surplus funds are invested on a short term basis in checkable accoutns because the company has a policy of never going ahead of the due date.

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Research and Budgeting Department

The research and budgeting department is responsible for making the annual budget of the company. The company makes revenue based budgets based on previous trends. Zero based budgeting is used for new shops only.

Replenishment Department

Borjan believes in understanding the needs and wants of the customers to provide them with then products that best suit their taste. For this purpose there is a replenishment department whose task is to review the products that have already been launched to analyze their performance and acceptance among the customers to see whether their supply should be continued or not. The replenishmnet department collects and compiles data on sales and also evaluates the stock in the warehouse to identify gaps in demand in the categories most liked by customers that can be fulfilled in the next season. Next it evaluates the different price ranges in this category and analyzes the volume of sales in each range. On the basis of this analysis the replenishment department gives recommendations to the merchandising department for purchase of those products of that price range in which there were the highest sales in the previous season.

Administration Department

The administration department is responsible for carrying out the following administrative and general supervision tasks:   Head office maintenance, security and management Coordinating with retail shops department in search of retail outlet sites and afterwards their management
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 

Coordinating with renovations department in preparation and opening of retail offices Management of office transportation

Information Technology Department

The information technology department is responsible for the architecture, hardware, software and networking in the company. 7 IT professionals in this department perform a number of duties to ensure that employees have full access to the computer systems. The designations of these employees are as follows Senior Dot Net Developer ------ 2 Oracle Programmer ------------- 1 System Administrator ----------- 1 Support Staff --------------------- 2 Dot Net Developer -------------- 1 The department works in coordination with the marketing department for maintenance of the company’s website and its upgradation at regular intervals.

The IT department has successfully completed the implementation of enterprise resource planning software Microsoft Dynamics AX 2009 in the head office and central warehouse. It is an off the shelf software for ready business retailers. The department has automated the recording of transactions for the 58 retail outlets using the Oracle based point of sales application. The retail outlets send the data to the head office on a daily basis which is then populated to the ERP through scripting by the IT department.

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Another duty of the IT department is to provide support to all the computer users in the company both in head office and at retail outlets. This includes repairing hardware problems, installing new hardware, troubleshooting problems and training and assisting the employees to use ERP and transaction recording software.

The information technology department is also responsible for setting up the computer network within the organization. The IT professional working in this capacity ensure that the network is operating properly and that all employees can communicate through the internet and company intranet.

Product Development Department

The product development department is responsible for coming up with designs for the products to be launched in the coming season. The department is divided into two sub-divisions:   Product Development for Ladies Product Development for Gents

Designers are hired by this department both on permanent and seasonal basis for designing. Each designer is made to specialize in one category because this helps in perfection. Once the shoe designs have been made consent is taken with the sales department for going into the manufacturing phase.

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Borjan does not manufacture any of its products on its own rather the approved designs are given to the merchandising department which then gets them manufactured from different sources. The usual cycle from designing to manufacturing of the product is of 90 days after which the shoe is launched in the market.

Human Resources Department

The human resources department is responisble for selection and recruitment of individuals that are right for a given job in the company. They help in making job descriptions and then recruit people according to these job descriptions. The department also organizes training development programmes for the employees and thus helps in their professional grooming.

The HR department is responsible for providing a sound and systematic benefits plan for the employees to not only satisfy them but also to motivate them continously for achievement of company’s goals. Borjan’s human resource department has developed a very good benefits plan for the employees whose major benefits include     Provident Fund Leave Encashment Bonuses and Incentives Insurance

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Central Warehouse Department

The Borjan central warehouse is located on Thokar Naiz Baig, Lahore and is responsible for distribution of shoes and other acccessories to the retail outlets all over Pakistan and to the wholesellers. The incharge of the warehouse is Mr. Khalid Ishaq. Hierarchy at the Central Warehouse

Warehouse Incharge Officers Quality Checkers Packers

Customer Care Department

The customer care department works in coordination with the marketing department and is responsible for correspondence with customers. The department entertains any claims or complaints launched by customers and works to resolve them. In addition the department provides sales and promotions information to regular customers through SMS and emails.

The claims policy of Borjan is as follows
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Claims for any defects / flaws in product are accepted within 30 days from the date of purchase with original receipt.

 

Absolutely no claims will be entertained on discounted items The Company’s decision regarding claim is final and cannot be challenged at any level whatsoever including, but not limited to the court of law.

STAFFING
The third managerial function is staffing which may be defined as “Selecting and training individuals for specific job functions and charging them with the associated responsibilities.”

Borjan (Pvt.) Limited is realizes that people are the most valued asset of any company. As a result Borjan is committed to hiring and retaining the best individuals for each job. The management believes diversity is essential to outstanding business activity. The current team of Borjan is a blend of talented individuals having exposure to multi-cultural and multi-national environment. Borjan (Pvt.) Limited is an equal opportunity employer and all vacant positions are always acdvertised in newspapers and online on job portals and the company’s official website.

Recruitment Sources
Borjan has different recruitment sources for the head office and retail outlets.

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Recruitment Sources in Head Office

Manpower Requisition Form Whenever a vacancy arises in the head office the concerned department is asked to fill manpower requisition form which contains details on all requirements and traits that are needed for that specific position. This form is signed by the chief executive officer and then the recruitment process starts.

At the head office the company uses both internal and external sources for the recruitment process. Internal sources include transfer or promotion of employees within the organization from one department to the other or within the same department whenever a vacancy comes. External sources include hiring people from outside who apply through one of the following ways: Direct Applicants Direct applicants are people who apply for a vacancy without promoting from the organization. This is one of the sources that Borjan uses for recruitment. Borjan has access to many online job portals and the CVs posted there for searching of suitable candidates.

Referrals Employees of Borjan may refer candidates which they consider right for a certain vacancy. These are known as referrals. The advantage of this recruitment source to Borjan is that these

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candidates have already gather information about the job and consider them selves appropriate for meeting the job requirements.

Advertisements in Newspapers Borjan publishes advertisements in newspapers when ever a vacancy arises. Interested candidates which meet the mininum requirements for that post can send their CVs to the HR department via email on [email protected] or post/drop the CVs at the head office, 333-R Main Boulevard Johar Town, Lahore.

Electronic Recruiting Candidates can look for vacancies in Borjan through the company’s official website and send their CVs to the human resource department via email or post or drop them in person at the head office.

Advertising in Universities and Colleges Borjan puts up advertisements in universities and colleges to attract fresh graduates for vacancies in the company. Usually Borjan does 50% of the hiring in the head office through external sources and the rest of the 50% through internal sources and referrals.

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Recruitment Sources in Retail Outlets

For retail outlets also both internal and external sources are used. Internal sources are the same as used in the head office. External sources include Advertisements in Shops When a vacancy comes up advertisements are placed in the shop in which the hiring is to be done as well as some stores near that place to attract interested candidates.

Advertisements in Newspaper Advertisements are given in newspapers for vacant positions in the store through which interested candidates can apply.

Recruitment Process
Once the human resource department has received CVs they are screened and candidates that seem to be suitable for the job are approached for further interaction.

For hiring at retail outlets the family background of the candidate alongwith the family structure and number of dependents is analyzed and on these basis candidates are short listed and then interviews are conducted by the HR manager and the group shop manager (manager of 10 shops). Interviews are conducted after a reasonable number of CVs have been collected in the following cities  Karachi and Quetta in South Region
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 

Lahore and Faisalabad for Central Region Rawalpindi for North Region

For the head office the selection process is as follows Initial Interview After analysis of CVs of interested candidates an initial interview is conducted for screening. This interview is conducted by the HR manager and usually 4 to 5 candidates are short listed afterwards.

Panel Interview The short listed candidates after the initial interview have to appear in front of a panel which is comprised of HR manager, chief operating officer and the departmental head. Usually this is the decision making interview and the best candidate for the job is hired.

Third Interview For higher posts a third interview with the chief executive officer might also be conducted.

The selected candidate is then informed of the company’s decision via a letter or a call.

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Orientation When a new employee joins Borjan he or she is given an orientation and introduced to the other employees. The department head also meets the employee and gives him an overview of the departmental processes and the duties that the new employee will have to perform. He or she is introduced to the company’s vision and goals and policies and made to feel welcome in Borjan.

Probationary Period For retail outlets the employees have to give a trial during the first 10 days and complete a probationary period of 90 days. After the successful completion of probation the employee has to give another interview in which he is tested upon his knowledge about the different products and his attitude after which he is made permanent.

In the head office the duration of the probationary period is 90 days however it may be extended in some cases. After the completion of this time the HR manager meets the employee and makes him sign a contract which has all details related to job description and salary etc. Three copies of this contract are made; one is given to the employee, second is kept by the HR department and the third is sent to the accounts department.

During the probationary period employees are considered as daily wagers and their performance is veryc losely monitored during this time. If some one is not performing up to the standards he or she can be terminated without any notice after clearance of the outstanding dues till that date.
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Salary Review The initial salary of the new employee made permanent depends on the level in which he or she is hired. The higher the level, the higher would be the initial salary.

Employee Peformance Appraisal All employees in the retail outlets are appraised on their performance on a quarterly basis whereas in the head office the appraisal is done on a semi-annual basis and for some positions on a yearly basis. The criteria for appraisal can either be on the basis of achievement of individual goals or on a pre-established set of standards made by the management of Borjan. The employee performance appraisal is used for various purposes such as counselling, identifying training needs, goal setting, merit review, distribution of bonuses and incentives and promotion.

Termintion Policies
Borjan follows the policy of employment at will which states that employee or employer can terminate the employment contract at any time regardless of cause. Resignation Resignation is the voluntary termination of service by the employee. On resignation the employee has to return all company property such as laptop, office vehicle, employee ID card etc. The notice period for resignation is 1 month otherwise a month’s salary will be deducted from the final settlement. Resignation is assumed if an employee remains absent from job for 3 consecutive days without excuse or exceeding 6 days within a month.
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Discharge The Borjan management can discharge any employee at any time. Discharge is the termination of the employment contract by the employer. Borjan has to give a notice of 1 month to an employee before discharge or pay 1 month’s salary for immediate discharge. The management can discharge an employee on the basis of following reasons     Misconduct Performance deficiency Inability to perform proper due to dome physical/ mental incapacitation Unavoidable management circumstances

LEADERSHIP
Leadership can be defined as “ The ability to successfully integrate and maximize available resources within the internal and external environment for attainment of organizational goals.”

The job of a true leader is to get the organization humming and operating at high efficiency in order to meet both its short term and long term goals. The leader is a visionary, flexible, agile and adaptable person who motivates the team to put in their best efforts.

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Leaders of Borjan (Pvt.) Limited
Qualities Leaders of Borjan possess all the qualities which are essential for effective leadership and success of the company:  They have a vision i.e. a clear and vivid picture of where to go as well as a firm grasp on what success looks like and how to achieve it.  They have the communication skills required to explain their vision to their followers and win their support.  Leaders of Borjan are persons of integrity who are same on the inside and outside. Honest dealings, predictable reactions, well-controlled emotions, and an absence of tantrums and harsh outbursts are all signs of integrity.  They are magnanimous and ensure that credit for successes is spread as widely as possible throughout the company.  They are humble and recognize that they are no better or worse than the other members of their team.  They are assertive and have the ability to clearly state what they expect from their sub ordinates to avoid misunderstandings.

Board of Directors
 Mr. Zahid Hussain

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Mr. Zahid Hussain is an experienced businessman who has a progressive thinking and a strong grip on the shoe and leather indusrty.



Mrs. Raheela Hussain

Key Management
Mr. Zahid Hussain - Director and Chief Executive Officer Mr. Syed Zafar Abbas - Chief Operating Officer Mr. Mohammad Naveed Shehzad - Country Manager and Retail Department Manager Mr. Khalid Jameel Haider - Finance Manager Mr. Sameen Sarwat – Merchandising Manager Mr. Anwar Sadiq – Wholesale Manager Mr. Omar Bajwa – Marketing Manager Mr. Azam Saeed – Research and Budgeting Manager Mr. Ali Ansari – Replenishment Manager

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Mr. Abdul Jabbar – Information Technology Manager Mr. Faisal Sana – Human Resources Manager Mr. Liaquat Hussain – Product Development (Ladies) Manager Mr. Tahir Yaseen – Product Development (Gents) Manager

Employees Benefits Programme
Borjan has developed a very good employee benefits programme with the aim of not only satisfying the employees but also to motivate them to perform their best. Some of the key features of the employee benefits programme are as follows: Salary Administration Borjan (Pvt.) Limited is giving good and attractive salary packages to its employees which are comparable with other local and multinational companies in the same business. Borjan positions itself at 80th percentile of the market average for its salary packages and at market average for benefits and incentives. Salaries are deposited in the employees’ salary accounts on the 5 th of every month however in case of a holiday on 5th the pay is paid a day earlier.

Bonuses and Incentives At retail outlets bonuses are awarded twice in a year. One bonus is given to everyone while the second is based on performance. In addition to this incentives are given to the sales staff on retail outlets on a quarterly basis on achieving the targets given to them. Staff that is performing very

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well is promoted to the position of second in-charge at his shop and given stipends and certificates. They can also be shifted to bigger branches which have more product lines and a higher profile of customers.

In the head office employees are given the same two bonuses on the same criteria as in the retail outlets. However they are not given any incentives.

Insurance Group life insurance is provided to all employees through EFU. In case of an emloyee’s death his or her beneficiaries will receive the insurance amount. For accidental death this amount will be doubled.

Annual Leave All employees are entitled to have an annual paid leave of 14 days. Annual leave which is not availed can be encashed after every 2 years.

Sick Leave Employees can avail 10 sick leaves on an annual basis. However for a sick leave of 3 or more consecutive days a medical certificate from a registered medical practitioner must be submitted

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to the HR department. Very strict disciplinary action will be taken in case an employee uses sick leave for any other purpose than illness.

Casual Leave Employees are allowed 10 days off per calendar year as casual leave. However when ever possible employees must inform their line managers in 24 hours in advance or at least in the initial hours of the day about the absence. On resuming duty the employee must get the leave approved from his line manager and inform the human resource department about the approval.

Leave without Pay Employees are entitled to leave without pay in case of unforeseen emergency if sick/ casual and annual leave have already been utilized.

Provident Fund Contributory provident fund at the rate of 7.5% is deducted from the monthly basic salary of all employees.

Training and Career Development Programme
Borjan believes in continuously improving the skills of its employees to bring maximum value to the company. From the first day employees are encouraged to acquire new skills and
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opportunities are given to them which offer a wide scope of learning and development while providing with a perspective which is attuned to the global markets and catering to the local environment. Borjan’s approach to career development is simple and focused which encourages people to    Be fully effective in their jobs for a long term career Be credible, proactive and open-minded Be self aware and honest about their aspirations, strengths and weaknesses

Retail outlet employees are usually given internal trainings which include on the job training by doing and learning as well as semi-annual trainings given to the entire network of employees by the country manager Mr. Mohammad Naveed Shehzad under different names such as Customer is our boss etc. One training was recently given and the other is due in July 2011.

For head office employees both internal and external trainings are arranged. Internal trainings include on the job training and orientation given on the first day of job. Recently external training was given to employees on performance management by Fulcrum Consultants. First aid training was also given to the entire staff by Rescue 1122.

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CONTROLLING
Controlling is the fifth managerial function which can be defined as “Systematic effort by business management to compare performance to predetermined standards, plans or objectives in order to determine whether performance is in line with these standards and presumably in order to taking any remedial action required to see that human and other corporate resources are being used in the most effective and efficient way possible in achieving corporate objectives.”

Borjan management has enforced active and meaningful controls on its employees and resources to utilize them to the maximum through departmental heads. Each departmental head is fully responsible for controlling his department. However in case of a problem that is beyond the scope of the departmental heads the top management can interfere.

In addition to this the human resource department keeps check on all employees through the following two tools   Performance Appraisal Corrective Disciplinary Action

Performance Appraisal
Employees performance is usually appraised on a semi-annual basis except for some key positions. Employees can be evaluated on the basis of either achievement of their individual

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objectives or on pre-determined standards set by the management. This appraisal is used for career development of the employees.

Corrective Disciplinary Action
Misconduct or neglience towards the duty by an employee can lead to corrective discplinary action. It is a process given as a chance to the employee to improve which has the following 3 steps Verbal Warning First offence of misconduct or neglience towards duty can lead to an oral warning by the departmental manager. The manager meets the employee privately and describes the problem, specifies the necessary corrective action to be taken and the time allowed for rectification. This discussion is written down by the manager and sent to the human resource department for record.

Written Improvement Notice In case the employee does not improve as result of the oral warning the departmental manager issues a written order for rectification.

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Discharge Failure to improve despite the written improvement notice leads to discharge. In addition to this the employee will be discharged if he reverts to misconduct within 6 months of issuance of the written improvement notice.

Internal Audit
Internal audit is an independent, objective assurance and consulting activity designed to add value and improve the organization’s operations. The internal auditors help the management of Borjan to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.

Internal auditors assure the board of directors and executive management that risks are mitigated and that the organization's corporate governance is strong and effective. And when there is room for improvement internal auditors make recommendations for enhancing processes, policies, and procedures.

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COMPETITORS’ COMPARATIVE ANALYSIS
Some of the major competitors of Borjan are

Stylo Shoes
From a rather humble beginning in 1974 from a rented shop in Lahore Stylo shoes has emerged as the largest ladies’ shoes brand and retail network in the country. Stylo is currently operating through 43 outlets in 23 cities and is continuously expanding.

Stylo makes sure that its customers always get the cutting-edge fashion footwear that they desire, be it formal, causal or bridal shoes. Although Stylo is a brand that caters to local needs but it also finds a place on the international platform.

Stylo is stringent in its dedication to quality and comfort and for this reason never compromises on the materials used for products or the skills of its craftsmen who turn designs on paper into alamode footwear. Their production facilities have provisions for both handmade shoes as well as automated shoe-manufacturing units. Material is often imported to ensure the level of quality. This is why Stylo has earned an ISO 9001-2000 certification.

Over the years Stylo has become a household name that has captured the imagination of women who consider footwear an essential part of their appearance and is popularly acknowledged as one of Pakistan’s leading footwear and accessory brands in women’s’ fashion.

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Bata
Bata was established in 1942 and was ready to serve the nation immediately after independence. The company was incorporated in Pakistan as Bata Shoe Company (Pakistan) Limited in 1951 which later went public to become Bata Pakistan Limited in 1979. Since its inception the company has not only maintained a reputation of manufacturing high quality footwear for all the socioeconomic segments of the society at competitive prices but has also been designing shoes in accordance with the changing fashions and trends.

Bata is a multinational company and has played a vital role in the economic progress of Pakistan. It has transferred sophisticated technology and business skills to the country and provides direct and indirect employment to about 10,000 people. Bata also supports a large number of local manufacturers by buying raw materials from them.

As a responsible corporate citizen Bata is actively fulfilling its social responsibilities and is permanently patronizing many charitable organizations and helping them in the form of cash and free shoes.

Bata has always been the market leader and in order to maintain its leadership it has invested millions of rupees in updating its systems and equipment during the last few years.

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Urban Sole
Urban Sole was launched in 1998 by Shafi (Pvt.) Limited as a national brand. Today Urban Sole is operating through a network of 21 company operated retail outlets. Urban Sole successfully launched its operations in Saudi Arabia in 2004 and its shoes are also available in Russia since 2007.

From smart ergonomic design concepts to the highest quality materials and workmanship Urban Sole has its own design, development, marketing, and distribution departments that ensure quality at every step of the way. They have handmade footwear as well as shoes made on state of the art technology imported from Germany and Italy which allow the company to maintain the premium quality that Urban Sole footwear is known for. Urban Sole shoes are certified under ISO 9001:2001.

Urban Sole is the licensee of the famous French brand Pierre Cardin in Pakistan and Pierre Cardin shoes are available at their outlets.

Hush Puppies
Hush Puppies is an international brand of contemporary, casual footwear for men, women and children which was founded in 1958. Hush Puppies is a division of Wolverine World Wide, the world's leading maker of casual, work, and outdoor footwear. And is headquartered in Rockford, Michigan. Hush puppies opened its doors in Pakistan in 1995 and is currently operating in all the major cities of the country through 21 retail outlets.
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By utilizing supple suede in combination with lightweight crepe soles, Hush Puppies creates soft, breathable and very comfortable shoes which define what it means to be modern and casual. Today, Hush Puppies continues to innovate, bringing technical excellence and genuine style to over 120 countries.

Firhaj Footwear an ISO 9001 certified footwear company in Pakistan located at Ferozepur road, Lahore, and equipped with the latest and most modernized Italian shoe manufacturing machines is the sole licensee of manufacturing and distribution for Hush Puppies and manufactures a wide range of their products for sale in Pakistan.

Imperial Shoes
Imperial shoes was established in 1984 by Mr. Imdad Durrani which continues to provide contemporary shoes to millions of shoppers in some of the major cities of Pakistan. The company has a young and dynamic structure and has expanded rapidly and increased its turnover manifold.

Imperial shoes’ products have a functional design and clear lines, thus capturing the essence of a continuous research process on materials and new technologies. The company is a network organization that allows a high flexibility and complete satisfaction of the client's needs at all levels.

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Their stores are located in a variety of settings including regional malls, shopping centers, central business districts, free-standing buildings and other retailer locations.

The outlets have been designed to create a serene atmosphere that pampers and indulges every sense and are always well staffed with friendly personnel to assist customers in every way.

Currently Imperial Shoes has 10 outlets operating in some of the major cities of Pakistan and 3 outlets in Kabul, Afghanistan. Soon it will open its doors in Sydney, Australia.

Comparison of Goals and Strategies
Borjan Borjan opened its first retail outlet in 1995 and since then has been providing top of the line fashion in shoes and accessories for ladies and gents. Borjan is regarded as the leader in introducing the largest number of sole designs in Pakistan.

The current goals of Borjan are focused on   Product concept development Improvement of business processes

These objectives are also reflected in the vision statement of the company i..e. to make its customers not only look but feel smart too.

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The major strategy being used by Borjan is based on creating a confidence among the customers that their shoes are the best and can fit their lifestyle for all types of occasions. The slogan of Borjan “Fashion Forward” also sheds light on the company’s commitment to blend comfort and style to bring the best in shoes and accessories.

Stylo Shoes Stylo shoes is one of the largest retail networks in the country for ladies shoes which is continuing to grow rapidly owing to its commitment to providing stylish and comfortable shoes for every occasion.

Currently the main goal of Stylo is to ensure product innovation and provide a buying experience that consistently exceeds the expectations of its customers which will help the company to maintain and strengthen it’s market share.

The main strategy of Stylo is to create a brand loyalty for its products which will create a confidence among the customers that they are being given the best quality at the best rates. Recently Stylo has started printing its magazine by the name of “Fashion ID” which has details on all the latest variety of the products which is then distributed to the loyalty card members of Stylo free of cost.

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Bata Bata is the oldest and most extensive shoes retails network in Pakistan. Its main goal remains to maintain its position as the market leader and bring the best of technology to be well-equipped for meeting the demands of the customers.

The strategy used by Bata for accomplishment of these goals is basically competitive pricing. Bata is nowoutsourcing a large portion of its production to China in order to achieve lower manufacturing costs. The main source for promotion is the electronic media but lately Bata is not spending much on its brand awareness as other companies are.

Hush Puppies Hush Puppies is an international network for retailing of shoes which is highly reputable and is known for its comfortable shoes. The main goal of Hush Puppies Pakistan is to create a brand loyaltly for their shoes.

Hush Puppies Pakistan is mainly focusing on the extension of its retail network in the country and designing and manufacturing shoes that best fit the climatic needs and tastes of the people.

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Imperial Shoes The goal on which Imperial Shoes is focusing currently is to become a comprehensive retail network for shoes.

To achieve this goal the company has been capitalizing on its marketing division and is introducing more and more product ranges and trying live upto its slogan of “The Brand of Fashion.” The company is also working on adding more and more retail outlets in all major cities to attract more and more customers from all walks of life.

Financial Comparison
The footwear and leather industry of Pakistan is considered amongst the best in the world and has a great potential to grow with the demand for footwear continuously increasing owing to the population growth of 2.25% per annum. Currently the industry is characterized by monopolistic competition.

The footwear industry has pivotal importance in terms of providing jobs, earning foreign exchange through exports and meeting the local consmption demands.

During the fiscal year 2009 – 10 Pakistani footwear industry manufactured 150 million pairs of shoes for local consumption and almost 2 million pairs of shoes were exported. Bata remained the market leader during this year and produced over 17.2 million pairs and sold 16.9 out of
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them. The company generated turnover of Rs.6.5 billion showing an increase of 26% against the previous year. Borjan also continued to grow during the last fiscal year and sold nearly 1 million shoes through its retail outlets and wholesale network. Stylo also kept on expanding its retail network and introduced new designs almost every week. On the other hand Imperial Shoes and Hush Puppies did not show much growth trends.

Though over the last year footwear industry did well but still the growth was hindered by the increasing inflationary pressures in the economy which has cut the purchasing power of the people of Pakistan drastically.

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SWOT ANALYSIS BY RESEARCHER
Strengths
Superior Quality Products Borjan offers superior quality products for ladies and gents for all occasions. The brand range is very impressive and the shoes have super soft leather uppers, concealed comfort cushioning and ultra light weight soles to make feet look and feel comfortable.

Research and Development Borjan is continuously allocating a huge amount of money on research to bring the best of fashions from across Europe and Asia. The company is putting a lot of effort in product development and has launched the highest number of sole designs in Pakistan.

Reliance on Local Vendors Borjan purchase all of its products from local vendors which save it from the costs and risks related to international trade such as tariffs and quotas.

Committed Staff The top management of Borjan is highly experienced and committed to their work. They believe in democratic style of management and encourage employees to take part in the decision-making process.

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Employees Benefits Programme Borjan has developed a very good employee’s benefits programme which awards the employees for their motivation and hard work thus encouraging them to perform to their fullest in future.

Affordability Borjan has a wide range of shoes in all price brackets. The shoes range from Rs. 400 to Rs.6000 and thus are accessible to people in all income groups.

Weaknesses
New Entrant Borjan is considered to be a new entrant as compared to some of the other established shoe retailing networks in Pakistan. For this purpose Borjan still needs to put in a lot of effort to create awareness and then loyalty for its brands.

Geographical Coverage Though Borjan has been expanding rapidly in all major cities of the countries still its geographical coverage is limited in many areas.

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Promotional Activities Borjan is not very active in promotional activities and does not use electronic media at all which is the biggest source of advertising nowadays. Furthermore Borjan does not sponsor any events or functions which can create awareness about their brands.

Penetration in Female Shoes Market Though Borjan has introduced a wide range of products for ladies of all age groups still it has not become the number one choice of the females who are largest buyers of shoes in Pakistan.

Aspiration Value to High Income Group The aspiration value of Borjan products is low amongst the high income group who can become a big audience for their products.

Opportunities
Introduction of Sports and School Shoes The demand for sports and school shoes is very high in the country. By introducing these lines of shoes Borjan can earn more.

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Customizable Shoes Introduction of shoes that can be customized on demand of customers e.g. arthritis, athletes foot etc. can bring a large volume of business for the company.

Expansion of Retail Network Borjan should expand its retail network in both the existing cities of operation and also enter into new cities. It should also start operations in other countries as well.

Advertising and Promotional Activities Borjan should allocate more budgets for advertising and promotional activities which will be helpful in building their brand awareness and loyalty.

Threats
Inflationary Pressures The economy of Pakistan is currently facing inflation of about 16% which has badly affected the purchasing power of the people. On the other side the cost of production has also gone up resulting in a hike in prices.

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Competition The structure of the shoe industry is changing rapidly. Many local and international vendors are entering into the market which has resulted in a very tough competition for Borjan and other companies in this sector.

Over Production The entrance of new vendors in the footwear industry and cheap imports from China have resulted in an over production where supply is a lot more than demand posing a threat of price war.

Marketing Tactics of Competitors Almost all the shoe retail companies are spending a huge amount of money for running marketing campaigns and advertising which is a great challenge for Borjan with a very low marketing budget.

Technology Multi-national shoe retailers are spending fortunes on transferring technology to Pakistan’s shoe industry to provide the highest quality shoes whereas Borjan still has to rely on cottage industry for production where quality cannot be guaranteed.

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THEORIES IMPLEMENTATION
Marketing Mix
Product

Borjan (Pvt.) Limited offers a wide range of casual and formal shoes under different brands and leather accessories for both ladies and gents of all age groups and for all occasions. Brands for Men Skywalk – Formal Shoes Digger – Casual and Rough and Tough Shoes Gig – Formal and Party Wear Shoes Matilla – Casual Chappals and Sandals

Brands for Women Skywalk – Formal Shoes Kashang –Casual Chappals and Sandals Glam Collection – Formal, Party and Bridal Shoes

Accessories Handbags for Ladies  Casual
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Formal

Belts Wallets

Pricing

Price is the most flexible and the only item in the marketing mix that represents revenue. All the other items represent cost. Realizing this Borjan gives great importance to its pricing strategy and uses it as a competitive weapon against its competitors. In the initial years of operation Borjan tried to convince its customers that their products were worthy of carrying higher prices. But in the recent years Borjan’s pricing strategy is focusing on providing quality at affordable prices.

Place

Borjan has positioned itself around subtlety and simplicity along with bringing into the market high quality and comfortable footwear. Borjan does not believe in advertising for the sake of advertising rather it wants to become the number one choice of the people through its better quality and value for money. Borjan has a well spread network of retail outlets in all the major cities of the country.

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Promotion

Promotion is a very important tool in the marketing mix. Borjan has not been spending much in advertising but regularly conducts promotional activities such as seasonal sales etc.

PEST ANALYSIS
Political Factors
The recent hike in energy prices along with frequent power failures and the fluctuating prices of fuel are a great challenge for the shoe and accessories industry. The import of cheap shoes from China under WTO’S free trade regime has badly affected the sales of the local vendors. Government has imposed heavy duties on raw materials of this industry which has resulted in increasing the cost of production. In addition the import of toluene is banned which is an important raw material in the shoe and accessories industry.

The local footwear and accessories industry has great potential in terms of generating revenue and employment if government plays its role and provides protection to the industry.

Economic Factors
Currently Pakistan’s economy has been hit by the highest inflation in history. The current inflation rate in the economy is nearly 16%. This has very badly affected the purchasing power of people who are now moving to the cheaper Chinese shoes which are a perfect substitute for the locally manufactured expensive shoes. On the other side the current inflationary pressures have put an upward pressure on the cost side too resulting in a further increase in the prices.

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Social Factors
The lifestyle of the people of Pakistan is continuously changing and there is a major shift in their values. People are inspired by western shoes and prefer western designs to traditional designs. People are becoming health conscious and give more importance to comfort and quality than style. Apart from this the population growth rate in the country is 2.25% which means a constant increase in demand for shoes and a great potential for the industry to progress.

Technological Factors
Multinational shoe companies are heavily investing in transferring technology to Pakistan. Technological advancements are going to be the biggest competitive tool in the future and only those companies are going to progress which switch to new technology.

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FINDINGS AND DATA ANALYSIS
The data collected through questionnaires is analyzed using descriptive analysis technique. Following are the important findings in the analysis: Frequency Distribution for Qs: 1

In your opinion is the existing receivables turnover of the company slow? Cumulative Frequency Valid Yes 20 Percent 100.0 Valid Percent 100.0 Percent 100.0

Interpretation All respondents are of the unanimous opinion that the accounts receivables turnover of the company is low.

Frequency Distribution for Qs: 2

If yes, does the problem lie on the customers' side or at the company's end? Cumulative Frequency Valid Customer side Company side Total 6 14 20 Percent 30.0 70.0 100.0 Valid Percent 30.0 70.0 100.0 Percent 30.0 100.0

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Pie-Chart for Qs: 2

Interpretation 70% of the employees surveyed were of the opinion that the problem lies on the company’s end whereas the remaining 30% believed that the problem was on the customers’ end. Frequency Distribution for Qs: 3

Does the problem of slow receivables arise mostly with new customers or do existing customers also make slow payments? Cumulative Frequency Valid New Customers Existing Customers Both existing and new Total 6 5 9 20 Percent 30.0 25.0 45.0 100.0 Valid Percent 30.0 25.0 45.0 100.0 Percent 30.0 55.0 100.0

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Pie-Chart for Qs: 3

Interpretation 45% of the respondents were of the opinion that the problem of slow receivables is present for both existing and new customers. 30% of them believed that the problem arises with new customers only while the remaining 25% were of the opinion that the problem is faced with existing customers only. Frequency Distribution for Qs: 4

Before extending credit to some customer does the company conduct a detailed analysis of the customers' credit worthiness? Cumulative Frequency Valid Yes No Total 13 7 20 Percent 65.0 35.0 100.0 Valid Percent 65.0 35.0 100.0 Percent 65.0 100.0

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Pie-Chart for Qs: 4

Interpretation 65% of the employees are of the opinion that the company conducts a detailed analysis of the credit worthiness of the customers whereas 35% of them believe that a detailed analysis is not done. On analysis of these responses it can be seen that H0: Customer creditworthiness and receivable turnover are independent. H1: Customer creditworthiness and receivable turnover are dependent.

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Customer creditworthiness is related to receivables turnover meaning that accepting customers with high credit ratings can improve the receivable turnover of Borjan.

Frequency Distribution of Qs: 5

Does the company accept customers with low credit rating for business dealings? Cumulative Frequency Valid Yes No Total 5 15 20 Percent 25.0 75.0 100.0 Valid Percent 25.0 75.0 100.0 Percent 25.0 100.0

Pie-Chart of Qs: 5

Interpretation 75% of the target audience believed that Borjan does not accept customers with low credit ratings while the remaining 25% did not agree with them.

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Frequency Distribution for Qs: 6

Is any customer with a history of making late payments even once, still extended credit by the company? Cumulative Frequency Valid Yes No Depends Total 10 3 7 20 Percent 50.0 15.0 35.0 100.0 Valid Percent 50.0 15.0 35.0 100.0 Percent 50.0 65.0 100.0

Pie-Chart for Qs: 6

Interpretation 50% of the respondents expressed the opinion that the company continues to extend credit to customers with history of delayed payment even once. 15% of the employees believed that it

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does not while the remaining 35% said that it depends on the quantum of business and the business relations of the company with the customer.

Frequency Distribution for Qs: 7

Are there any problems or delays associated with the mail float of the customers? Cumulative Frequency Valid Yes No Total 8 12 20 Percent 40.0 60.0 100.0 Valid Percent 40.0 60.0 100.0 Percent 40.0 100.0

Pie-Chart for Qs: 7

Interpretation 60% of the employees believed that there is no problem with the mail float while the remaining 40% disagreed with them.
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Frequency Distribution for Qs: 8

Is the sales and recovery staff of the company efficient enough to carry out the collection and recovery process? Cumulative Frequency Valid Yes No Total 9 11 20 Percent 45.0 55.0 100.0 Valid Percent 45.0 55.0 100.0 Percent 45.0 100.0

Pie-Chart for Qs: 8

Interpretation 45% of the employees believe that the sales and recovery staff is efficient while the remaining 55% think they are inefficient.
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Frequency Distribution for Qs: 9

Is the sales and recovery staff given proper trainings to carry out the collection process and follow customers who are making late payments? Cumulative Frequency Valid Yes No Total 5 15 20 Percent 25.0 75.0 100.0 Valid Percent 25.0 75.0 100.0 Percent 25.0 100.0

Pie-Chart for Qs: 9

Interpretation 25% of the respondents were of the opinion that proper trainings are given to the recovery staff while the 75% of them disagreed with this opinion. On analysis of these responses given by the employees of the wholesale and finance departments it can be concluded that
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H0: Training of sales and recovery staff and slowness of receivables turnover are independent. H1: Training of sales and recovery staff and slowness of receivables turnover are dependent.

Null hypothesis will be rejected proving that training of sales and recovery staff has an impact on the company’s receivables turnover.

Frequency Distribution for Qs: 10

Does the company have a well-defined and proper receivables collection method? Cumulative Frequency Valid Yes No Total 13 7 20 Percent 65.0 35.0 100.0 Valid Percent 65.0 35.0 100.0 Percent 65.0 100.0

Pie-Chart for Qs: 10

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Interpretation 65% of the employees said that the company’s collection method is proper while the remaining 35% were of the opinion that it is not.

Frequency Distribution for Qs: 11

Does the company use the earlier billing technique to speed up the collection of receivables process? Cumulative Frequency Valid No 20 Percent 100.0 Valid Percent 100.0 Percent 100.0

Interpretation All employees expressed the opinion that the company does not use earlier billing to speed up the collection of receivables process. Frequency Distribution for Qs: 12

Do you think there is any problem with the processing float of the company that delays the availability of the receivables to the firm? Cumulative Frequency Valid Yes No Total 12 8 20 Percent 60.0 40.0 100.0 Valid Percent 60.0 40.0 100.0 Percent 60.0 100.0

Pie-Chart for Qs: 12

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Interpretation 60% of the employees think that there is a problem with the processing float of the company while 40% think otherwise.

Frequency Distribution of Qs: 13

Is the current infrastructure of the banking sector responsible for delays in availability of the receivables of the firm? Cumulative Frequency Valid Yes No To some extent Total 14 3 3 20 Percent 70.0 15.0 15.0 100.0 Valid Percent 70.0 15.0 15.0 100.0 Percent 70.0 85.0 100.0

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Pie-Chart for Qs: 13

Interpretation 70% of the respondents expressed that the current infrastructure problems of the banking sector are responsible for slow turnover. 15% believe that this is not the case and the remaining 15% think that this is true to some extent. After analysis of these responses the conclusion can be drawn that among the null and alternate hypotheses H0: There is no relationship between infrastructure problems of the banking sector and receivables turnover. H1: There is a relationship between infrastructure problems of the banking sector and receivables turnover.

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Null hypothesis will be accepted showing that the problem of slow receivables turnover and infrastructure problems of the banking sector are unrelated.

Frequency Distribution for Qs: 14

Do you think the overall length of the collection float is responsible for the slow receivables turnover of the company? Cumulative Frequency Valid Yes No Total 13 7 20 Percent 65.0 35.0 100.0 Valid Percent 65.0 35.0 100.0 Percent 65.0 100.0

Pie-Chart for Qs: 14

Interpretation
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65% of the target audience said that the total length of the collection float affects the receivable turnover of the company while the remaining 35% disagree with them. On the basis of these responses it can be concluded that H0: Length of collection float and company’s receivables turnover are independent. H1: Length of collection float and company’s receivables turnover are dependent.

Alternate hypothesis will be accepted meaning that length of collection float and receivables turnover of the company are related.

Frequency Distribution for Qs: 15

Does the company give credit discounts or incentives to the customers to encourage them to make early payments? Cumulative Frequency Valid Yes No Total 5 15 20 Percent 25.0 75.0 100.0 Valid Percent 25.0 75.0 100.0 Percent 25.0 100.0

Pie-Chart for Qs: 15

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Interpretation 75% of the employees were of the opinion that company does not give any incentives to encourage early payments while 25% did not support this proposition.

Frequency Distribution for Qs: 16
Is the current budget of the company for making collections, training the sales and recovery staff and giving them incentives adequate? Cumulative Frequency Valid Yes No Total 9 11 20 Percent 45.0 55.0 100.0 Valid Percent 45.0 55.0 100.0 Percent 45.0 100.0

Pie-Chart for Qs: 16

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Interpretation 55% of the staff members surveyed believed that the company’s budget for collection and training is low whereas the remaining 45% disagree from them.

Frequency Distribution for Qs: 17

Can the slow accounts receivables turnover be accepted because of the poor business activity prevailing in the economy these days? Cumulative Frequency Valid Yes No Total 16 4 20 Percent 80.0 20.0 100.0 Valid Percent 80.0 20.0 100.0 Percent 80.0 100.0

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Pie-Chart for Qs: 17

Interpretation 80% of the target audience blames the slowness of business activity for slow receivable turnover while 20% do not agree with this thought. On the basis of these responses it can be concluded that among the hypotheses H0: Slow business activity and receivables turnover are independent. H1: Slow business activity and receivables turnover are dependent.

Alternate hypothesis will be accepted and that slow business activity is affecting the receivables turnover of the company.

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Frequency Distribution for Qs: 18

Has the company liberalized its credit policy in face of the slow business activity? Cumulative Frequency Valid Yes No Total 12 8 20 Percent 60.0 40.0 100.0 Valid Percent 60.0 40.0 100.0 Percent 60.0 100.0

Pie-Chart for Qs: 18

Interpretation 60% of the staff expressed their opinion that the company has liberalized its credit policy in face of the poor business activity while the remaining 40% disagree.

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Frequency Distribution for Qs: 19

Does the company give leverage for bad debts when accounting for the slow receivables turnover? Cumulative Frequency Valid Yes No Total 10 10 20 Percent 50.0 50.0 100.0 Valid Percent 50.0 50.0 100.0 Percent 50.0 100.0

Pie-Chart for Qs: 19

Interpretation 50% of the people think that the company accounts for bad debt losses while the other 50% thinks it does not. Frequency Distribution for Qs: 20
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Is the accounting system of the company good enough to account for these losses when calculating the receivables turnover of the company?

Cumulative Frequency Valid Yes No Total 15 5 20 Percent 75.0 25.0 100.0 Valid Percent 75.0 25.0 100.0 Percent 75.0 100.0

Pie-Chart for Qs: 20

Interpretation 75% of the respondents think that the company’s accounting system is good enough to account for the bad debt losses while the remaining 25% think otherwise.

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Conclusion Sampling techniques could not be used for data analysis because the questionnaire was filled by everyone in the target audience. Thus validity of hypotheses has been checked through the responses of the 20 employees surveyed in the finance and wholesale departments. On the basis of these responses it has been concluded that four out of the five independent variables identified have an impact on receivables turnover. These variables are length of collection float, creditworthiness of customers, slow business activity and training of sales and recovery staff. Borjan can improve its receivable by making efforts to shorten the length of collection float so that funds are available to the company quickly. By analyzing the customers’ creditworthiness thoroughly bad rated customers can be weeded out and risks associated with late payment can be reduced. More should be spent on the training of the sales and recovery staff so that they can play a better role in collection of receivables. However the company cannot do much about the slow business activity that is currently prevailing in the economy. The variable that has been identified as insignificant during the course of this research is the problem of banking infrastructure.

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COMPANY’S FEASIBILITY REPORT
Future Plans  Borjan plans to increase its network of retail outlets up to 98 by June 2015. The target for the current fiscal year is to have 60 branches.  Borjan plans to go international and open its branches in Afghanistan as soon as the situation improves there. The plans to open operations in Middle and Far East are already in the loop hole.  Borjan intends to increase its brand awareness by investing more in marketing and promotional activities.  Integrating the retail outlets with the head office enterprise resource planning software is also under consideration.

The shoe industry of Pakistan has been doing quite well despite the recession. In addition to this the population of the country is increasing at a rate of 2.25% per annum meaning a constant increase in the demand of footwear each year. The social structure of the economy is also changing rapidly and people are moving towards Western styles. Tapping this change and meeting the needs and wants of people can bring positive results for Borjan. Investing in marketing and building brand loyalty will be the most important tools in the next few years because there is still a lot of potential in this industry for companies to survive and be profitable.

All variables under consideration it can be said that Borjan can do quite well in the next five to ten years. The need of the hour is to deal with the changing scenario effectively and efficiently.

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SUGGESTIONS AND RECOMMENDATIONS
Borjan is a leading footwear retail company which started its operations in 1996 and is into designing and retailing of shoes through its own retail and partner retailer networks.

The management of Borjan believes that shoes should represent one’s personality and has spent a lot of time and resources to bring beautifully crafted, cutting-edge, urban, fashionable footwear to the customers.

Borjan takes pride in having launched the highest number of sole designs in Pakistan. Such achievements have been made possible only through the continuous heavy investment in research and development that aims to bring the best of fashion from Europe and Asia to the country.

Over the years Borjan has been successful in establishing itself as a world-wide manufacturer of private label and branded footwear at affordable prices and has the potential to do even better in the future. However the company has some weaknesses which must be worked upon. Given below are some suggestions for improvement  The company should rely less on cottage industry to control the quality of its products more effectively.

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The current marketing budget of the company is quite low and there is not much awareness about the company’s brands. More should be spent on promotional activities and electronic media coverage to create strong brand recognition among the masses.



Employees’ benefits programme should be revised and more incentives should be given to motivate the employees. They should also be provided with free health care.

 

The company should expand its branch network and enter into more cities of the country. The recovery staff should be properly trained to follow the company’s wholesalers and ensure that they make timely payments. Collection methods should also be improved.



The company should analyze the creditworthiness of interested wholesalers before entering into contracts with them.



There should be more decentralization in the company and employees should be encouraged to take part in the decision-making process.



The company should introduce credit discounts and incentive to encourage the wholesalers to make payments before time.



The company should spend more on product development and should increase its product range and should enter into more market segments.



The company should try and minimize the collection float to speed up its receivables turnover.

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BIBLIOGRAPHY

About Us. Retrieved on 11th January’ 2011 from www.borjan.com.pk/about.html Company Profile. Retrieved on 11th January’2011 from www.styloshoes.com/aboutus.html History. Retrieved on 13th January’2011 from www.urbansole.com.pk Bata Pakistan. Retrieved on 12th January’ 2011 from www.bata.pk Where It All Began? Retrieved on 11th January’2011 from www.imperialstores.com.pk/main Rehman, M. (2009) Pakistan Footwear Industry. Retrieved on 21sDecember’2010 from

www.pakfootwear.org
Farooqi, A. (2010) Potential of Footwear Industry of Pakistan. Retrieved on 27th December’2010 from www.jstor.org on 24th December’ 2010

Sherani, S. (2010) State of the Economy, Economic Survey of Pakistan 2009-10. Retrieved on 1st January’2011 from http://finance.gov.pk/survey_0910.html Rehman, H. (2010) Manufacturing, Economic Survey of Pakistan 2009-10. Retrieved on 31st December’2010 from http://finance.gov.pk/survey_0910.html

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APPENDIX
This survey is being conducted for collecting information about the slow receivables turnover of Borjan (Pvt.) Limited. All information provided by the respondent will be kept confidential and will not be used for any purpose other than this survey. Thanking you in anticipation for your precious time. ----------------------------------------------------------------------------------------------------------------------------------------Name of the Respondent: ____________________________ Rank: _________________________ ----------------------------------------------------------------------------------------------------------------------------------------Qs: 1 In your opinion is the existing receivables turnover of the company slow? 1. Yes 2. No

Qs: 2 If yes, does the problem lie on the customers’ side or at the company’s end? 1. Customer side 2. Company side

Qs: 3 Does the problem of slow receivables arise mostly with new customers or do existing customers also make slow payments? 1. New customers 2. Existing customers 3. Both existing and new customers

Qs: 4 Before extending credit to some customer does the company conduct a detailed analysis of the customer’s credit worthiness? 1. Yes 2. No

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Qs: 5 Does the company accept customers with low credit rating for business dealings? 1. Yes 2. No

Qs: 6 Is any customer with a history of making late payments even once, still extended credit by the company? 1. Yes 2. No 3. Depends

Qs: 7 Are there any problems or delays associated with the mail float of the customers? 1. Yes 2. No

Qs: 8 Is the sales and recovery staff of the company efficient enough to carry out the collection and recovery process? 1. Yes 2. No

Qs:9 Is the sales and recovery staff given proper trainings to carry out the collection process and follow customers who are making late payments? 1. Yes 2. No

Qs: 10 Does the company have a well-defined and proper receivables collection method? 1. Yes 2. No

Qs: 11 Does the company use the earlier billing technique to speed up the collections receivables process?
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1. Yes 2. No 3. Sometimes

Qs: 12 Do you think there is any problem with the processing float of the company that delays the availability of the receivables to the firm? 1. Yes 2. No

Qs: 13 Is the current infrastructure of the banking sector responsible for delays in availability of the receivables to the firm? 1. Yes 2. No 3. To some extent

Qs: 14 Do you think the overall length of the collection float is responsible for the slow receivables turnover of the company? 1. Yes 2. No

Qs: 15 Does the company give credit discounts or incentives to the customers to encourage them to make early payments? 1. Yes 2. No

Qs: 16 Is the current budget of the company for making collections, training the sales and recovery staff and giving them incentives adequate? 1. Yes 2. No

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Qs: 17 Can the slow accounts receivables turnover be accepted because of the poor business activity prevailing in the economy these days? 1. Yes 2. No

Qs: 18 Has the company liberalized its credit policy in face of this slowness of the business activity? 1. Yes 2. No

Qs: 19 Does the company gives leverage bad debts when accounting for the slow receivables turnover? 1. Yes 2. No

Qs: 20 Is the accounting system of the company good enough to account for these losses when calculating the receivables of the company? 1. Yes 2. No

Qs: 21 What do you suggest should be done to improve the current receivables turnover of the company? ______________________________________________________________________________ ______________________________________________________________________________

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