25044209 bicycle industry analysis of pakistan business research methods

Table of Contents

Executive Summary.....................................................................................................2Introduction & Product Specification........................................................................3Specification of Bicycles in Pakistan..........................................................................4Production capacity and Major players.....................................................................6Locations.......................................................................................................................8Production and Capacity Utilization..........................................................................8Import/ Export for Five years.....................................................................................9Raw Material (Local, Imported)...............................................................................10Sources of Raw Material...........................................................................................11Production process.....................................................................................................12Problem faced by Industry........................................................................................20Technological Level....................................................................................................21Pricing.........................................................................................................................22Government Policies and Incentives.........................................................................22Future Prospects (after WTO)..................................................................................23Bibliography...............................................................................................................24

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Executive Summary

Bicycle industry in Pakistan has a significant background in the history of Pakistan. There was no registered manufacturing business related to bicycle. It takes few years to have a new corporation which agree to manufacture some of the parts of the bicycle locally in Pakistan. Pakistan cycle industry ranked at the lower level if it compare with the remaining world. Some of the neighbouring countries have more competitive market shares in the world. There are few types of bicycles which are producing in the Pakistan. One of them has more demand in the market and others have low market share world wide. All the types of the bicycles are available in many sizes. One of them is stronger than other types, in terms of using in the rural areas also. The production capacity of bicycle has mixed trend in Pakistan. It increases for some years and then decrease and also again increases during few years. There is significant number of major players of bicycle in Pakistan but one of them has captured the maximum number of market share and created a monopolistic environment in the bicycle industry. The locations of the major factories are in the approachable position of the country. Major factories have large capacity of production and they are also utilizing their capacity in an efficient manner. The import of raw material has fluctuating trend during last few years and export has low trend during the last few years. There is lot of raw materials used in the bicycle industry. Most of the raw material is manufacturing locally and is being collected from the local vendors from the same location. But the main raw material is imported from the other countries with direct relation of the companies with the vendors in other countries. Some of the finished parts of bicycle are also imported from different countries. The production process which the industry is using is almost the same in all factories. The difference is in the size of the production plant and capacity of plant. But the major parts of the bicycle are manufactured by the factories. The production process includes the input of the raw material from the imported one and local one and the process is being carried out in different large number of stages and at the last the finished items are taken to the stores of the factory. Most of the factories are selling their bicycles without assembling them. The problems which are currently facing by the bicycle industry include smuggling of imported bicycle with low prices and good look which attracts the customers, the instability of the government in the Pakistan, the labour unions laws, no availability of imported tool material in Pakistan and the Non Engineering background work force of the factories. The level of the technology which is being used in the manufacturing of the bicycles is basically not up to date and most of the machinery is old enough not to operate well. The prices of the bicycles are economic level in all the types, according to their target market. The government policies for the light engineering industry are not much familiar and most of the time policies don’t have the incentives for the particular industry. The impact of WTO rules on this industry will automatically improve the efficiency of the industry and their related businesses. But there are some demerits also which will face in terms of WTO implementation on the specific industry. Government is not seriously taking this industry as the major player of the economy.

University of Management and Technology, Lahore Pakistan

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Introduction & Product Specification

History

There was no single factory which manufactured bicycles and their spare parts at the time of independence in Pakistan. There were no industry in Pakistan and due to that fact some of the importers of that time brought bicycle in Pakistan and passed on for sale to retailers most of the shops were situated in Lahore at Nila Gunbad which was the main market of bicycles. Today Nila Gunbad market is the main market of car tyres, Bicycle tyres and spare parts.

Arrival of Bicycle industry in Pakistan

In 1952 the Shortage of foreign exchange reserves encouraged a serious look into domestic production and a remarkable idea was conceived by the twenty two shop owners of the Nila Gunbad area drafted a plan to establish foundation of a co-operative society for the purpose of bicycle manufacturing factory within the country on cooperative basis. The main reason behind the establishment of the society is to provide mutual help and benefits to its founding members. Elections of the society were held promptly. The society has been functioning successfully all along is because of the fact that its members take deep interest in its working.

Local & imported Spare Parts

According to the reports of different governmental departments only a few spare parts of bicycles were manufactured locally at the initiation of Bicycle industry and about 90% spare parts were import from abroad. The situation started improving with the passage of time and today almost 98% bicycles spare parts are being manufactured in Pakistan or through vendors. According to different published sources there are 300 bicycle vendors in Pakistan and employing more than 3000 workers.

Pakistan Bicycles industry overview

If we compare Pakistani bicycle industry with international bicycle industry then we can see that we have only one major manufacturer in the industry and covering the entire local market. The international bicycle industry is much stronger than Pakistani bicycle industry. India is the second largest manufacturer of bicycles after china. China has great contribution in the manufacturing of bicycles. Chine’s Bicycle industry is a big threat for both Indian and Pakistani bicycle industry. We can say that the decline of local Pakistani industry is just because of imported Chine’s Bicycles are covering the market share.


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Specification of Bicycles in Pakistan

In Pakistan bicycles are the only cheaper means of transportation for the local public. Bicycles are categorized in to fancy and standard bicycles.

Fancy Bicycles Standard Size Bicycles

Standard bicycle is the smaller segment worldwide and is on the decline with more and more companies turning towards fancy bicycle. In Pakistan standard bicycle is the bigger segment. The sub segments of the fancy bicycles in which mountain bike, BMX, Electric bicycles and recumbent bicycles. If we want to segment the bicycle industry then we can segment bicycle in to three categories small size bicycles, medium size which is also called fancy bicycles and standard size bicycles.

Fancy Bicycles

A fancy bicycle has different types which attracts the youngsters. When we talk about speed then indeed one thing always come in to our mind that less weight bicycles are more reliable for customer point of view. Fancy bicycles has the speciality of different frame designs, colours, braking system, comfortable seats, stylish reflectors, electric light system for mountains, classy mudguards, sporty looks, shining nickel brings more beauty in the product which attracts the customers. Gear system increases the speed of the bicycle but decrease the pressure of pedals.

Small size bicycles Small size bicycles are only for children’s which has child attraction features in which the colour, frame design are more important features. It lies in the category of Fancy cycles.


http://en.wikipedia.org/wiki/File:Mountainbike.jpg

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Standard Size Bicycles

The third segment is standard size bicycle which is for personal use instead of entertainment. The benefit of standard bicycle in Pakistan is more as compare to fancy. The target market of standard bicycle is poor people or those who work on wages. There are 50,000,000 people who work on daily wages in all the areas of Pakistan and to be considered as the poor people. The standard bicycle is the major benefit for the Pakistani region.

Standard Bicycle speciality

These are the countries China, India, Pakistan, Afghanistan, Bangladesh, and Syria in which the largest population is dependent on bicycles. The main features of standard bicycle is heavy weight, we can carry children giving a ride to our spouse. Carrying capacity is more than fancy bicycles. We can carry lunch boxes, laundry cloths, milk containers and a variety of things. People play bicycle polo in northern areas of Pakistan. The bicycle of night watchman in our colonies proudly rides it all night, blowing a shrill whistle to remind us that he is keeping a careful eye on streets.


http://en.wikipedia.org/wiki/File:Brosen_city_bicycle.jpg

http://en.wikipedia.org/wiki/File:BicyclesMilkChurnsKolkata_gobeirne.jpg

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Production capacity and Major players

Production Capacity

The capacity of the Pakistani bicycle industry is to produce 1.45 million bicycles per annum. From 2002 to 2003 the local production of bicycle recurring with 629,695 numbers of bicycles produced according to the industry statistics. From 2003 to 2004 681448 bicycles were produced with the increase of 8.22% from previous year. From 2005 to 2006 the production of bicycles was 449400 which was a decline from the previous trends, in year 2007-2008, the production increases to approximately 650,000 and in year 2008 the capacity increase to approximately 1 million.

Major Players

According to the SMEDA report Pakistan bicycle industry is dominated by one key player, Sohrab which comprised more than (80 %) eighty percent share of the whole industry whereas the rest of (20 %) the production is shared by other six authorized and unauthorized manufacturing companies. Our group members visited many dealers in the market and talked about the current trends or preferences of the customers.


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Market share of Standard bicycles Market share of Fancy bicycles

Chinese Phoenix BicycleChinese Phoenix bicycle was every where in the shops. According to the shop keeper the demand for Chinese Phoenix cycle is very high just because of low prices and stylish designs which attract customers. All spare parts of Chinese bicycles are available in the market. Low quality and low price Chinese Phoenix bicycles are also available in the market. Some people go to the price factor and rest go with the quality factors. There are some more types in which you will find High price and high quality Chinese Bicycles. The finishing of the Chinese bicycle is excellent as compare to the local manufactured bicycles. Chinese bicycles are not solid in nature but the fancy categories are the main focus of Chinese bicycles.

Sohrab

Sohrab established since 1953, as a small assembly unit for bicycles. The “Sohrab” a standard bicycle, is the largest selling bicycle in the country. Several other varieties produced under the brand name Sohrab include, sports and fancy bicycles in which BMX, Panda, Vip sports, Sprinter, Mountain bikes (with Multi Speed Gears).

Sartaj and Humber

Some local unauthorised manufacturers buy different spare parts and make their own bicycles at home and then sell into the market by putting the names of Sartaj and Humber. I saw two or three Bicycles of Sartaj in which the handle of the Bicycle was made of Sohrab and some of the parts were Chinese and local made. There was no check from the governmental authorities which is the need of the bicycle industry.

Market Story of different bicycles

In standard bicycles Sohrab is the one which people like most in Punjab. We asked many dealers about Sohrab they said Sohrab is like a Brand in standard Bicycles people always prefers Sohrab Bicycle. Falcon Bicycles are manufacturing in china and the dealers put the name ‘Falcon Pakistan’ and sell it in the local market. Eagle and Sohrab are the two companies which are manufacturing standard bicycles and the cost is also affordable and providing 5 years Warranty of the frame and other parts as


Major Manufacturing companies of Bicycle

Industry (Standard and Fancy Bicycles)

Companies NameChinese Phoenix

Sohrab EaglePEGOFalconSONYSartaj

HumberOlympic

Eagle KarachiSindh Cycle

Unorganized Sector

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well. Sartaj is the Indian Bicycle name but manufacturing in Pakistan. Sartaj is also providing 5 year warranty of the frame. The same Sohrab frames are being used by these small companies like Sartaj and humble.

Locations

SOHRAB SARTAJRustam & Sohrab Factory Locally Manufactured Sheikhupura Road, Shahdara, in Nila Gunbad Workshops,Lahore-Pakistan. Lahore, Pakistan

Phoenix PEGOImported from China, Locally Manufactured, In Nila Gunbad Workshops,

Lahore, PakistanEAGLEShahdara, Lahore HUMBER

Locally Manufactured, In Nila Gunbad WorkshopsLahore, Pakistan

Production and Capacity Utilization

The capacity utilization of the Bicycle industry is:

Capacity Utilization = Effective Capacity . Production Capacity

= 2300 . 3000 = 77 %


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Import/ Export for Five years

All values are in thousands US dollarsSr. No. Years Import Export

1 2001 1329 02 2002 10,443 17623 2003 16,060 114 2004 15,710 05 2005 11493 0

In the above table we can easily differentiate each year import and export. In the year 2001 the import was 1329 thousand US dollars but exports were zero. In 2002 the imports were 10,443 thousand US dollars and exports were 1762 thousand US dollars. In 2003 the export level which was 16060 thousand US dollars was higher than the previous years on the other hand the exports of 2003 was only 11 thousand US dollars. After the period of 2003 the imports started decreasing and come in to the level of 15,710 thousand US dollars. The exports were zero at that time. In the 2005 figures the imports were 11493 thousand US dollars which is again decreases from the previous year 2004. The exports were zero in 2005.

Trend of Imports Vs Exports in Five years

The trend of imports and exports clearly justifies that the imports were very high and the exports were very low but in 2002 we can see the increment in the exports of


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Raw Material (Local, Imported)

Steel

The Steel metal sheets and rod lengths which are heavily used in the manufacturing process of all the small components of Bicycle are suing from the loc

The steel which is used for manufacturing frames of bicycle are imported from United Kingdom. The reason behind buying from international market was the metal which can easily bend in the high heat temperature. The metal which is local made was not easily bent in the high heat temperature and the chances of wastage were very high. Some small manufactures use local material instead of imported like Eagle Manufacturers in Lahore.

Plastic Material

Plastic material which is being used in the Bicycle is local. Companies prefer local because the cost of imported is higher than the cost of local plastic material.

Nickel

The chemical which is used for the purpose of electroplating process is also imported. According to the manufacturers the local chemical is in low quality but the imported chemical is good in quality.

Paint

The paint which is used for the frames of bicycle is locally made instead of buying form international market.

Acids

Acids which are used heavily used in the manufacturing process are imported. Local are also available but those companies like Sohrab they prefer imported material.


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Sources of Raw Material

Steel

The steel which is used for manufacturing bicycle frames are imported from United Kingdom. The steel which is used for manufacturing small metal parts of the bicycle are local made from ILL Company and are the main dealer of Karachi Steel mills. Front head of bicycle is imported from Italy and Japan.

Plastic material

Plastic material is from Universal Rubber Manufacturer in Lahore and some other vendors it depends upon the prices and relationship of the firms with their vendors.

Nickel

Nickel is imported from United Kingdom the company which is the largest provider of nickel all over the world is INCO.

Paint

Paint is locally used from ICI companies and Burger paints. Both companies are the best companies in Pakistan and are considered to be the best provider of paints.

Acids

All acids which are used in the manufacturing process are imported from United Kingdom and locally made in Lahore as well. But the companies which are trying to improve the quality of the bicycle they usually prefer imported acids.


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Production process

We went to the Sohrab production plant and the assembly line engineer told us about the production process of the frame and bicycle components. He said the process of producing these frames and components all over the world is same but the technology which the other companies are using may be more advance. There are 35 workshops, named “Shop”, which are producing different components of bicycles in the Sohrab manufacturing plant. These 58 workshops covered almost 15 acre of the land and the remaining 10 acre area is covered by different offices. It was the wonderful experience of our group members while sorting all the production operations in the factory. More than 3 to 7 machines were installed in each workshop. The sizes of each workshop depends upon the nature of the component either it is bigger or smaller. If the component has different stages of production it requires bigger space. Time management was excellent by the workers who were producing different tasks in each workshop. The main production departments are in this table.


No. Workshop/ Department No. Workshop/ Department1 Brake 30 U.C.P Plant2 Wheel Chair 31 Mudguard3 Polishing Mcs 32 B.B. Axle4 Enamelling 33 Press5 Electric 34 R. M. Store6 Frame 35 G. Store7 F.G. Store 36 Rim8 Handle 37 Granodine9 Inspection 38 Invoice D.S.S Office10 Packing 39 E/P (Manual)11 Welding 40 B.M.X12 Cyclo Machines 41 Design Office13 Rex. Saddle 42 Pro. Planning and Control14 Pedal Assy 43 Mat. Control15 Hub 44 Transit Pool16 Machine 45 Laboratory17 Pedal Turning 46 D. Nickle18 Fabrication 47 Foundry19 Machine Maintenance 48 N.P (Manual)20 Screw 49 Polishing21 B.B.Shell 50 E/P Plant 122 B.B.Fitting 51 Warping Assy23 Cutting 52 E/P. Plant 224 C.W Crank 53 E.P. Plant 325 F.F. Fitting 54 Jig Repair26 Front Fork 55 Cold Forging27 Hot Forging 56 Bulging28 Free wheel 57 Heat treat Plant29 Pedal Axle 58 Motor Cycle Prod DEV

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The table describes the departments which has different task to perform. These workshops or departments produce different components of the Bicycle. It was very difficult to study the function of each department in depth. Mr. Afzal was the engineer production of training program in Sohrab Manufacturing plant. Mr. Afzal told us that it will take four months to understand the system or flow or production process in Sohrab Factory.

Process Flow Chart of Bicycle

Material Preparation In material preparation all the raw material which includes the Steel metal sheets and rod lengths which are heavily used in the manufacturing process of all the small components of Bicycle, Plastic material which is being used in the Bicycle, the nickel which is used for the purpose of electroplating process, paint which is used for the frames of bicycle and Acids which are used heavily in the manufacturing process for cleaning of metal surfaces.

Bending / shearing In the bending process rods are used to bend by heating the rod to make the surface soft and easily bend. By filling the rod with sand and bend the road with the help of bending machines. The rod of bicycle handle is also bending with the help of bending machine. In the shearing process metal sheets cut in to different shapes according to the requirement of the component with the help of sheets cutter machine. In the rims of the bicycle metal sheet strips are used to manufacture a rim.

Drilling/ Twisting


Material Preparation

Drilling/Twisting

Bending/Shearing

Welding/Riveting

Spring, nutsAnd Bolts

AssemblingPainting/Electroplate

Packing

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In the drilling process different components require different types of drilling like in the manufacturing of rim drilling is used in the rim metal surface to fix the spokes. The spokes holes are punched simultaneously through a hydraulically operated machine

Welding/ Riveting The welding process is also called brazing process which is used in the joining of bicycle joints. After welding process the brazing metal frame are cleaned off by pickling in acid solutions and by washing the metal surface until it is smooth.

Spring, nuts and Bolds Different machines are used for making springs, nuts and bolds. These workers are making different types and sizes of nuts, springs and bolds. Each machine operates manually by one or two workers.

Painting/ Electroplating Paint may be applied by hand spraying or by passing the frames through automatic spraying rooms. The finishing of hand spray is better than the finishing of automatic spray machine. Hand spray require more time. Chrome plating may also be used instead of paint on components such as the fork blades in few cases. After spraying process they bake the frame for few minutes in to the temperature room in order to dry the paint. Some of the parts of bicycle require nickel coating instead of paint and the plant is called automatic electroplating plant. The parts are loaded from one end and then go through the electroplating process. At the end of the process, they are unloaded from the same end.

Assembling In the assembling process if the requirement from the dealer to assemble the bicycle then they install all the parts of the bicycle.

Packing In the packing process six bicycle parts are packed into plastic and cardboard boxes to supply to the dealer.


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Production Process of Bicycle Frame

Flow chart

P

ipesPipes are bought from outside vendors. Theses pipes are in lengths and are of special quality in term of thickness and size. The Flat steel sheet wrapping it into a tube and welding it together along the length of the tube and these tubes may then be further manipulated to increase their strength and decrease their weight by butting, or altering the thickness of the tube walls.

Oiling The pipes are covered with oil to protect them from rust. The process of oiling is done by using the paint brush and dips it in to the oil and rubs over the surface of pipes.

Washed with kerosene oil


Raw MaterialPipes

Oiling

Sawdust and clean

Washed withKerosene oil

Cutting Stretching

Brazing Cleaning FinishingAligning

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After oiling these pipes are covered with kerosene oil and wash the pipes with kerosene oil.

Wiped with Sawdust and cleaned After washing with kerosene oil they rub the surface of pipes with sawdust which absorb the oil from the surface of the pipes.

Cutting In the cutting process pipes are cut in to different sizes according to the requirement. Pressing machines are used in cutting the pipes according to different sizes.

Stretching Stretch the pipes thinner and longer tubes, a process called cold drawing. The tubes may be shaped and tapered into a variety of designs and lengths. The fork blades may have to pass through more than a dozen operations to achieve the correct strength, weight, and resilience.

Brazing Process

Tubes can be joined into a frame either by hand or machine. Frames may be brazed, welded, or glued. The brazing filler is generally brass (copper-zinc alloy) or silver, which melt at lower temperatures than the tubes being joined. The T joints are made in dies in which pipes are fitted. In brazing process the parts in which front wheel frame are fork blades which hold the front free wheel. The four tubes which are connected together in forming a frame in which the Seat tube is connected with the top tube and the rear tubes. Down tube is connected with the head tube and the seat tube. The rear triangle in the above diagram consists of the chain stay, seat stays, and rear wheel dropouts are attached to the seat tube from both ends.


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Aligning The assembled frames are placed and checked for proper alignment. Adjustments are made while the frame is still hot and malleable. Forge from hammer to adjust the frame. Adjust the frame from all sides according to the required measurement.

Cleaning The excess brazing metal frame are cleaned off by pickling in phosphate solutions and by washing and grinding the brazing until it is smooth.

Finishing

Flow chart of Finishing

The frames are painted to create more finished appearance the frame is first prepared with an undercoat and then painted with colour enamel. They first prepare the surface of the @1717 171717


PrepareSurface

ElectrostaticSpray Paint

ZincCalciumPhosphate

Polyclean

ChromicAcid

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ÏÏð<181818@1818 181818 ed. Polyclean is used for degreasing. Zinc calcium phosphate layer is added for paint purpose. The pores are then sealed with chromic acid. The frame is passed through an electro static spray painting plant. The painted parts are passed through an oven where the temperature is kept between ‘150-160’ degree C. The frame is first sprayed with primer and then re coated with paint for luster finish. In case of red colour, the paint is sprayed with a manual spray gun. First the part is covered with black paint then Aluminium colored undercoat is done and finally sprayed with red paint.

Production Process of Rim


Flat SteelStrip

Turning Bending

Drilling/Punching

Welding

Polishing Machine

NickelProcess

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The machine takes a flat steel strip, turns the edges, bends and welds them. The sheet is rolled and person sits and cut the sheet according to the required size with the help of a gauge. The spoke holes are punched simultaneously through a hydraulically operated machine. They also have a person who punches these holes manually for fancy and non standard rims. They have polishing machine that polishes the rims.

After polishing process rims go to the Department of Nickel where the process of electroplating implemented on the rims which give the silver shining colour to the rims. After the entire process they fix spokes, which are laced one round at a time between the rim and hub flange.

Production process of crank

Dish form cuttings from the Mild Sheet in the picture.


Blanking/Piercing

Punching/Teeth cut

Indexing/ Dish Form

Nickel & Chrome Plating

Inspection Packing

Teeth Tapering

Center Hole Spline Cutting

SplineForming

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We saw the crank workshop as well where the workers were cutting the Mild sheet in to circles and after that they further make holes in to the circles and after the completion of crank sets they further move to the D Nickel department for electroplating process. The crank set supports the pedals and transfers power from the pedals to the chain and rear wheel. Crank sets consist of steel or aluminium alloy crank arms, chain rings, and the bottom bracket assembly of axle, cups, and bearings. They are attached with bolts and caps into the bottom bracket of the bicycle frame. The pedals are then screwed to the ends of the crank arms

Production Process of pedal Arm

.

Problem faced by Industry

Pakistan Bicycle market is struggling to establish itself due to smuggled bicycles coming from China and India, high raw material utility prices. There is very low export presence of Pakistan in this sector and according to IAR (Industrial advisory


HeatingPerforming

ForgingTrimming

DrillingReaming

Thread making

(left hand)

Spline Forming

Spline Pushed in 1

Sprocket arm

Buffing Nickel& Chromium

Plating

Final Inspection

Packing

21

report) ‘one player Sohrab dominates with 80 % share in the local market and for a new manufacturer to establish itself in this sector, he would need to concentrate on the fancy bicycle segment and may flourish if he enter in to the joint venture agreement with some internationally reputed firm’. If bicycles imports from India and china are allowed, then it will be difficult for the local bicycle industry to compete on the basis of prices competition.

Political situation is one of the important major issues faced by the Bicycle industry. The unstable political system and terrorist activities are creating hurdle for this industry in which export of bicycles to Afghanistan is one of the biggest challenge for the industry. Cross border trade between Afghanistan and Pakistan was seriously disturbed by these terrorist activities on both sides of the border line. Trade between Afghanistan and Pakistan was closed since the US forces holds the command of Afghanistan after 9 /11 military operation. Mr. Afzal told us that before 9 /11 the industry was moving towards growth but after the incident of 9 /11 the graph of growth moves towards decline stages after the bad incident of 9 / 11. Mr Afzal (Engineer production) told us that all the industries which are linked with the bicycles industry are also affected by 9 / 11 incident.

Mr. Afzal (Engineer production) told us that there are 200 top level union labours who are taking salaries from Sohrab management and these workers are not working in this factory but these people can seen every where in the Sohrab factory. Mr. Afzal told us that there are 227 owners of Sohrab and the main issue among these owners are decision making process.

The tools which are used in manufacturing process were imported but it could be difficult for the firm to import the tools on regular basis. The other issue is the import duties on such heavy equipments are the major problem faced by the industry.

Workers who are working in this industry are non engineering background. Most of the labours are graduates with simple BA degree and the rest of the labour are hardly metric pass. When I asked Mr Afzal that what is your qualification? He replied that I am intermediate with mechanical diploma holder. Mr Afzal said I had great long time experience with this industry. We went to another production manager and he was the only person who had a BSE mechanical engineering degree and told us about the communication problem among different workers on field.

People who are highly educated avoid staying in the bicycle industry for employment because of low salaries and less incentives provided by the Sohrab management authorities forces the educated workers to switch the job.

Technological Level

The technology which is used by the Pakistan bicycle industry is very low. If we compare the technology used by Pakistan bicycle industry with the international bicycle industries then we can say that we are 90 percent far away from those latest technology users.


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The machines which are running in Pakistan bicycle industry were installed in 1957 and after that time they just replace the spare parts instead of the entire plant or machine.

According to Mr. Afzal (Engineer production) told us that the machines which are used in the process of manufacturing was towards the last stages of life. Government is not paying any attention in helping the bicycle industry in bringing the new machinery in Pakistan.

The paint department is using automatic machines which we can say that those machines are slightly towards a symbol of new technology.

According to Mr. Afzal (Engineer production) the electroplating department is using medium level technology as compare to other machinery.

Pricing

As there are two major categories of the cycle: Standard Bicycle Fancy Bicycle

So, Prices are:

Average Price of Standard Bicycle: Rs. 4700Average Price of Fancy Bicycle: Rs. 8000

Government Policies and Incentives

There are some of the government policies which are related to bicycle industry in Pakistan. These include:

Material Constraint

Government has pointed some of the specific vendors for purchasing the raw material only from them.

Labour Law Constraint

Government has a rule: Not to fire the worker in any case without the proper documentation and with

in a long period of time.


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And also the company should have to pay the wages even if the factory is not in the operations.

Also if the worker is on leave so the company have to pay him/her half of its pay.


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Future Prospects (after WTO)

As Pakistan is the member of the WTO since 1st January, 1995. After the WTO applied on bicycle industry so there are some of the benefits associated with this prospect. These are as:

The raw material especially nickel and the steel rods which are directly imported from different countries by the companies, will cost less because of some of the import and export duties charged on them, so the prices of the bicycles will automatically be cut down.

Some of the parts in finished products like spokes and chain & its cover are also imported from some countries, so after WTO their prices will also cut down.

There are also some of the demerits of the WTO:

After WTO, Pakistan bicycle industry will face a lot of competition from other multinational companies.

They are not able to compete with them in terms of prices. They are not able to compete with them in terms of quality.


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Bibliography

http://www.smeda.org/business-development/pre-feasibility-studies.html/ download

http://www.smeda.org/archives.php/ download

http://www.smeda.org/info.php?id=88

Pakistan /Punjab/Lahore/UMT/library/statistical data

Pakistan/IAR reports/bicycle Industry

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/training center/M.Afzal (engineer Production)

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/training center/deputy production Manager

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/ Hadlug Bluging Shop/Munir Ahmad (worker)

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/Chain Wheel Shop

Pakistan /Punjab/Lahore/Shahadra/Sohrab Factory/RIM Shop

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/Younas cycle works(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/Asim cycle Store(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/London cycle store(shop)

Pakistan /Punjab/Lahore/The Mall/Nila Gunbad/Sohrab dealer/S. Hanif & Brothers(shop)


http://www.smeda.org/info.php?id=88

http://www.smeda.org/archives.php/

http://www.smeda.org/business-development/pre-feasibility-studies.html/%20download

25044209 bicycle industry analysis of pakistan business research methods

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