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Chapter 1

Background of Study

University of Agriculture Peshawar, they requires its students to undergoes an internship

program. This internship program fortifies the students practical experience, with correlation
their theoretical knowledge. The selection of the firm/company based on the choice of student,
which leads to, study and analyzes the performance of the concerned organization. It is a
common practice at Universities, that students are required to attain practical experience, at the
end of their courses


Purpose of study
There are three purposes of this study. Firstly, the study was prepared as prerequisite, for the completion of the degree program of Bachelor in Business
Administration (BBA), at IBMS, KPK University of Agriculture, secondly to understand
and analyzed the procedure of Sale office Peshawar of Cherat Cement Company. The
recommendations are for the areas of the Cement Industry of Pakistan to which special
emphasis was paid as to have an efficient cement industry. Third purpose was to study
how the company, others services to meet the need of its customers.


Limitation of the Study

The internship duration was of 8 weeks, which is considerable a very short period
of time, for the collection of data on large organization, working nationwide and
international. Writing report on such a large organization is more niggling. Though a
great deal of personal efforts have been made to overcome all the difficulties, in order to
make it a productive study.


Research Methodology
During the internship at SOP, CCCL, the most important task was to collect all the
information of the company, in order to understand the functioning and write a report on
it. For this purpose both the primary and secondary data has been used.
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Primary Data
Primary data are the new data gathered specifically for the project at hand. It is a
form of personal observation. It is the most original data and has undergoes any sort of
Statistical treatment. It is the data collected for the first time is called primary data.


The senior company officer I interviewed to known their views, about the various
problems faced by the cement industries.


Secondary Data
It is the available data or the data already gathered for some other purposes.
The secondary data is in form of
Annual Reports
Circulars and Memorandum
Reference Books

Chapter 2



The Cherat Cement Company PVT Ltd incorporated in 1981. The

Cherat Cement Company belongs to the Ghulam Faruque Group. The CCCL is the most elevated
and influential company in the GFG. Cherat cement is a premier name in the field of cement
manufacturing in Pakistan. The Cherat cement factory is located near Nowshera, and is built on
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land of Cherat hills. The company sources high quality limestone. It started production in
1984.The company is listed by the Karachi , Lahore and Islamabad Stock Exchanges.
Cherat Cement has an ISO 9001 2000 certification and produce high
quality gray Portland cement using modern production techniques. The company is equipped
with advanced production and high quality control system. Cherat Cement Company is leading
producer and suppliers of cement in the Khyber Pakhtoonkhwa and Punjab and enjoys strong
brand loyalty amongest his customers. The company through its exports becomes Afghanistans
leading brand.


Growth through the best value creation for the benefits of all the stakeholders.



Invest in projects that will optimize the risk return profile of the

> Achieve excellence in Business.

Maintain competitiveness by leveraging technology.


Continuously develop human resource.

> To be regarded by investors as amongst the best blue chips

stock in the country.


History of the Company

Before 1981 there was an association who created MONOPOLY in the cement sector
because of no close competitor in such industry. So to break that association and to offer cement
to the public Cherat Cement factory was founded. Cherat cement is not only one of the best
qualities cements in Pakistan, but in the entire region because of its natural favor "the
limestone" which is one of the best quality reserve in the world. Cherat Cement Company is

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one of the largest Companies of Ghulam Faruque groups. Cherat Cement Company
was incorporated at Karachi on May 25, 1981 as a public limited.
Company t h e c e r t i f i c a t e o f c o m m e n c e m e n t o f b u s i n e s s w a s
o b t a i n e d f r o m t h e r e g i s t e r o f joint s t o c k Companies Karachi on July 8, 1998. Land of
about 2219 canals and 4 Marlas were obtained on lease from the government of NWFP. Mining
concession over an area of 10378.54 acres was obtained from the government of NWFP. The
foundation stone of Cherat Cement Company was laid on 1 stJanuary 1982 by the
then president of Pakistan General Zia Ul Haq. It is situated at the foothills
of Cherat cement near Lakarai village at distance of about 40 kilometer from
Peshawar city. It started its production on 10 January 1985 after its inauguration by
the governor of NWFP Lt. Gen. Fazl-e-Haq. The plant was built by a French firm
named Creuot Loire to enterprises abbreviated as CLE. It was the first cement
factory in p r i v a t e s e c t o r. d u e t o i t s i m p o r t a n c e t h e g o v e r n m e n t o f N W F P
b u i l t r o a d a n d p o w e r l i n e s f o r t h e factory.
The factory had the capacity to produce 1460 tons of cement per day but after plant
expansion in 1993-94 its production capacity has increased to 2400 tons per day. The plant
expansion was completed in October 1994. And the recent production of the factory is 3300
tons per day.


Board of Directors
Mr. Muhammad faruque


Mr. Azam faruque

Chief Executive

Mr. Akbarail pesnani


Mr. Shehyar faruque


Mr.Tariq faruque


Mr. Javaid anwar

Mr.Aamir amin

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Mr. Sauib H. shirazi


2.6 Executive Director & Chief Financial officer

Mr. Yasir Masood

2.7 Audit Committee, Auditors & legal Advisor

Audit Committee
Mr. jawaid anwar


Mr. Akbarali pesnani


Mr. Tariq Faruque


Emst and Young Ford Rhodes Sidat Hyder
Chartered Accountant

Legal Advisor
K.M.S Law Associates.

2.8 Registered Office/Factory

Village Lakari, P.O Box 28
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Head office
Modern Motors House,Beavmant Road, Karachi.
Sales Office
Peshawar : 1st floor Betani Arcade, Jamrud Road
Lahour : 3, Sunder Das Road
Islamabad : Mezzanine floor Razia sharif plaza 90- blue area


We want Cherat Cement Company to be regarded by our customer and our
employees as the best and the most profitable organization in the market we serve. We seek
innovation and improvement in every part of our business, through a system of ideas,
suggestions, feedback and application.
Every member o f Cherat Cement Company Limited continuously pereceives quality
improvement through procedures, designed to provide the knowledge and skills needed to
achieve the goal of our quality policy in line with customer requirements and by
adhering to applicable statutory and regulatory requirements related to product.


Expansion of plant
Due to the increasing demand of cement, Cherat Cement Company

carried out and completed its plant expansion in 1994, which increased the production capacity
up to 2500 tons per day. This expansion was financed through the loans from outside and the
internal loans. Now once again due to increase in demand of cement in local and international
market especially in Afghanistan. The Cherat Cement Company expanded their plant in
December 2005, which enhanced the company production capacity more than 3500 ton cement
per day.

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Ghulam Faruque Group

Cherat Cement Company Ltd
Cherat Papersack Ltd
Mirpurkhas Sugar Mills Ltd
Faruque (Pvt.) Ltd
Greaves Pakistan (Pvt.) Ltd
Greaves C.N.G (Pvt.) Ltd
Greaves Air-Conditioning(Pvt.) Ltd
Greaves Engineering (Pvt.) Ltd
Madian Hydro Power Ltd. Company
Unicol Ltd. Company
Zensoft (Pvt.) Ltd


Ghulam Faruque
Ghulam Faruque Khan (18991992) was a Pakistani economist, bureaucrat,

politician and industrialist. Because of his contribution to Pakistan's industrial development,

he is sometimes described as "The Goliath who Industrialized Pakistan", and was the founder
and Chairman of Ghulam Faruque Group.

He his graduated from AliGarh University India. After

graduation, he started

his career in Bengal nagpur railways in 1912.

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Late Ghulam Faruque remained on several key positions, which are listed below.
General manger east India railways.
Chairman cotton board Julin board.
Chairman Pakistan industrial board corporation.
Chairman Pakistan ordinance factories.
Secretary to ministry of industries Govt. of Pakistan.
Governor of former east Pakistan.
Federal minister of commerce & defense.
NWFP provincial minister for finance planning and development.
Member of National Assembly of Pakistan.
Senator in 1985 and re-elected in 1988.

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Chapter 3

Function of Sales Office

The Cherat Cement Company have different and competitive selling and marketing
network in Sales office Peshawar. Well qualified staff who have all the knowledge about the
market dynamics. This staff is giving the services of Marketing, Booking, planning, & Dispatch.
The whole work at the Sales Office Peshawar is done separately in different

Booking section
Planning Section
Accounts Section
Computer Section

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Types of Customers

Cherat Cement Company has network of Dealers all over the Pakistan.
Dealers are the customers who have separate accounts with the company
and can booked cement according their quota in official timing.


Procedure for Dealership

A potential dealer submits an application or dealership to the concerned

manager for the particular area. In case of foreign dealers the application is submitted to manager
marketing. The concerned area manager marketing evaluates the need for a dealers in that area or
country financial position and reputation of the potential dealers.
The specified manager marketing recommends the application along with
dealer evolution form (mkt/4/001) to the Executive director (sales & marketing) for approval. If
approved by him, then applicant is asked to deposit the security amount (which is round about
20000) and sign a dealership agreement for sale of Cement. For foreign dealers an export
agreement is written down. If the contract is approved by the Executive Directors and other
related officers, the dealer becomes permanent and now he can booked cement any time
according to the agreement.


Booking Section
In Cherat cement Company the whole Booking is done by Computer. The

booking section is well equipped with up-to-date computers, which makes the booking easy and
errors less. Before the computer was introduced at office the Booking was manual, on manual
Booking it took a lot of time. According to the demand of the market you must be fast. That is
way now all the booking is done by computer.

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In fact the introduction of computer has made the booking process much
more efficient and all the receipts coming from dealers can be booked. booking section works
from 8 A.M to 4 P.M after that planning section make the dispatch plan.

3.2.1 Depositing Cash in Company Accounts.

The Dealers goes to the bank thats having an account of Cherat Cement
Company. In Peshawar MCB, ABL & Standard chartered Banks are authorized to receive
payment on the behalf of Company. Cash deposit slip of Cherat Cement Company has been
placed in all the branches of above mentioned banks.
Outside Peshawar the company has its account only in MCB. The
customer deposits the cash in the company Account and in return the bank gives him a copy of
deposit slip. Deposit slip contain the information about the amount deposited amount, date, bank
name, branch, and dealer code. Deposit slip is then brought to sale office for the booking and
kept this slip in record of the dealer in Accounts section.


Hard cash not receive

Booking starts from 8 A.M it is important to mention

here that dealers dont pay in cash. The booking section is not authorized to accept the cash.
However hard cash is only accepted if the top management allow it. Numbers of reasons for
which the company does not entertain the hard cash, the primary being safety. The sales office
has no arrangements for keeping huge amount for cash brought in by the dealers which will have
to be carried from the sales office to the companys accounts. So the company wants to avoid this
entire factors.


Confirmation of deposit slips

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At the sales office of CCCL the dealers goes to the accounts section for
confirmation, the accountant check the dealer balance from the computer to know whether the
dealer have debit or credit status. Cherat Cement received alerts from the bank. CMD is the
software where when the bank punch amount in the company Account here manager received
alerts that the dealer no. 12345 deposited cash in the Company Account. If the dealer having a
debit balance then it means that first he will have to clear his old amount. For example dealer
deposited amount of Rs 550000 for booking 10 tons of cement but his balance shows debit
balance of Rs 500000. The accountant will deduct Rs 50000 from Rs 550000 and the actual
balance would be Rs 500000 now the accountant would only allowed to booked 6 or 7 ton
cements according to the current dispatch rate of cements.
After the confirmation of the accountant writes the quantity on the deposited
slip and sign the slip.


Again Booking Section

After the confirmation of the deposit slip the dealer goes to the booking section

where the he books his cements. There is a booking counter through which the dealers pass their
deposit slips to the booking manager. The booking manager first of all checks that the slip has
been checked and sign by the accountant and then books are required quantity for the dealers.
The dealer is given a booking conformation receipt containing information about the quantity
booked, the rate per ton, agency code, dealer code etc.


Booking verification
In this step the booking is verified and two copies of booking confirmation receipt

are prepared. On copy is given to the dealer and the other copy is kept in the sales office for
record. This receipt is a proof of booked cement.

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Booking through mail

Cherat Cement Company limited also provides its dealers the facility of booking

through mail. Dealers from far areas send Photostats of deposit slips through mails, emails and


Booking backlog
The quantity which is booked but not yet to be planned is known as booking

backlog, the record of the booking backlog is saved in the computer system of the company at
sales office from which the dealers can acquire information about the quantity he has booked in
the past few days but not yet planned.


Hold function
The company program SAP contains an important function HOLD. This

function facilitates both the dealers and booking officer to hold the quantity. This function helps
to make the booked cement to be disappeared from the booking backlog and in this way that
particular booking would not be mentioned in the final dispatched plan. Hold function is
important from the perspective of both the dealers and the company may hold booked cement
because of the debit status of the dealer. Or any other shortcoming which the dealers still has to


Booking Report Defines

The following reports are prepared on the daily basis in booking section, which

defines the following aspects

Booking order number
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Mode of payment
Dealer description
Dealers code
Province code
Division code
City code
Area code
Rate per ton


Area/country wise booking

This report contains the following information.
Province code
Division code
Dealer code
Quantity booked


Planning Section
Without planning all the work could not be completed in well

manner. It is the first step towards the achievement of goals. In CCCL there is separate
planning section, which acts as a connection between the sales office and the dispatch
office at the Factory. This section allocates booking quota to different sellers on the basis
of information provided by booking section. The planning section determines production
level of the cement and its distribution on the basis of demand, time and market location,
for example it may happen that all the quantity booked is dispatched on the same day.
It may happen that the previous periods booking is still pending which is
not yet planned and also there may be pending dispatches in the factory. So if the
planning department plans all the quantity booked then the quantity pending at the
factory will increase considerably, on the other hand if less quantity is planned then the
booking backlog will shoot up. So care is taken while making a final plane every day, by
keeping both aspects in mind. When the policies of top managements are lenient and also
the demand from dealers and the market is less than all the quantity booked is planned on
the same day so dispatch order are issued on the same day. There are also some other
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factors like dispatch backlog should be less, booking backlog should be less etc. when the
market demand is low, then the booking would be less and planning would be easier. In
these circumstances the planning department acts upon the come and get or book and
get, principles.
But if the policy of top management is strict and also the demand is higher,
then the planning section will plan carefully. It will not plan all the booked cements.
Because as the demand become higher than the production and transportation channels,
all the dispatches cannot be made on the same day. Suppose the demand is 8000 ton daily
and the production capacity per day is 6000 ton per day then it is not possible to dispatch
all the bookings. If the production is increased to 8000 ton per day but the company
cannot dispatch for the day due to shortage of trucks, again dispatches are not possible.
Planning also depends on the backlog positions. If the booking is made i.e. if
the money is collected from the dealers but the plan has not yet been made, it means the
CCCL is liable to deliver cement to the dealer in the future or when demand. So if the
booking backlog is more than attempts would be made by planning department to plan
maximum booking by keeping in view the capacity of the dispatch department. When the
backlog is less and new booking are more than the planning department will not plan all
the quantity, it may not allocate all the quantity , which is booked.
Similarly, if there is backlog in the factory, i.e. the planning quantity which has
to be dispatched, is there then the planning department will constrict its hands, i.e. it will
not plan all the booked quantity. But if the factory backlog is less then maximum
planning will be made. In peak day that is in the days of high demand is higher than the
CCCL fixes the quota for different areas and for the different dealers when the demand is
higher the management tries to diversify its product i.e. to send the cement to all the areas
and all dealers. If there is demand for cement in all the divisions of KPK then all should
be fulfilled equally. Not a single division should suffer due to the non-availability of the
cement not one should be enriched at the cost of other divisions.
The planning department has adopted the principle of market segmentation it
has divided its main market in to the number of smaller market. CCCL provides cement
all over the Pakistan but it has divided its main market into smaller market on provincial
basis, i.e. Punjab, KPK, Sindh, and Baluchistan, similarly Kashmir, FATA and even

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Afghanistan are considered as separate market. Again these markets are divided into
many other smaller on divisional and area basis respectively.
The whole process is computerized and all the provinces, divisions, areas, cities,
and also dealers have been given code number to avoid confusion. These codes are given
for simplicity. For example when a dealer gives the addresses of destination to the
planning department, there may be some difficulty in reaching the address. To recognize
the destination accurately, codes are used. Two or more dealers may be of same name,
and pose difficulty for the company to determine as to whom the dispatch should be
made, similarly two areas may have the same names. The use of code helps in
overcoming such problems.
The marketing officials of CCCL forecast the sales of the company for the whole
year. The forecasting is based upon previous experiences, current position and the future
predictions. When sales for the whole year are forecast, this is called the major objective,
which is to be smaller objectives. Sales of the whole year are divided on monthly basis
what should be the monthly sales. Then again monthly sales are divided into sales per
day. All the smaller objectives lead to the achievement of main objective.

Plan Defines


Plan number
Serial number
City code and Area number
Dealer code
STP number
Booking order number
Date of booking/ delivery

Dispatch section
Dispatch section work under the sales office. Dispatch section is located at
factory. Staff here is working in 2 shifts, each shift works 8 hours, the 1st shift starts from
6 am and ends at 2 pm and the 2nd shift starts from 2 pm and work up to 10 pm so the
Dispatch office remains open for 16 hours per day.
All the orders booked and planned at the sale offices are dispatched from the
dispatch office. Planning manager sends the plan to the dispatch office through an email
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(in SAP software) dispatch office received the plan and starts working on this plan. The
manager at dispatch section print out the plan and distribute the area amongst the


There are seven transporters working for Cherat Cement Company who

distribute the cement amongst the dealers and parties. They arrange for the trucks and

transportation to distribute the cements.

Names of transporters are
Afridi Goods
Peshawar Lahore Goods
A.K Khattak
Sahibzada Goods
Rehman Shinwari Goods
Chaghi Goods
Mushtarika Goods
The planned and destination divided among these seven dealers. Ever
transporter is given an Entry Gate Pass pad by the company. He has to fill this pass to
get his truck entered in to the factory.


The packing plant

Packing plant is the part of factory. When the cement is ready as finished goods. It

is stored in tank like structure known as Cement Silo (technical name) here cement is stored
under some special conditions so that it does not affect from humidity etc.
The tally clerk at the packing plant receives the entry pass from the driver and
tallies the information such as plan number and serial number and transporter stamp on entry
pass with the plan already received at the packing plant. Plan number and the serial number are
marked that they same in both the record. Tally clerk makes two tally sheet from the entry pass.
The tally sheet contains the following things

Plan Number
Serial Number
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Truck number


Weight Bridge
As the loading of cement bags is completed in the truck, one copy of the tally

sheet is given to the driver. Driver of the loaded truck brings the tally sheet to the
weightment office, the officer at the weightment office enters the tally sheet number in a
register and in excel sheet and print tree copies which contain tyer weight (weight of the
empty truck) loaded truck gross weight and net weight (weight of the loaded truck). He
also tallies the weight of the loaded quantity with the weight mentioned in the entry pass.
If there is some difference, he notes it down.
There is always some plus or minus in weight because each truck contains
minimum of 200 bags, if there is a difference of 500 grams in each bag so it will make a
difference of 100 kilograms per truck 500 grams is minor things but the difference per
truck is more than 300 kg then the officer reports it to the packing plant.
1 bag of Charat cement contains 50 kgs of cement, so 20 bags makes it ton.
Dispatch office makes an invoice, acknowledgement slip and making a sales tax invoice.


Sales Tax Invoice

Sales tax invoice defines

Booking order number

Plan number
Truck number
Invoice number
Dealer code
STP (shift to party)
Invoice date
Rate per ton
Delivery address
Serial number
Numbers of bags
Tax inclusive value


Accounts Section
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A skillful and well organized accounts staff is inevitable for any business concern.
In Cherat Cement Company, there is a well established accounts section which helps to
keep frequent check on all the transaction. All the transaction is handling through SAP.
The accounts section keeps all the records of inflow and outflows. Some of the main jobs
performed by the accounts section sales office are mentioned below.


Types of Vouchers
a) Cash payment voucher
This voucher is used when payment is to be made in cash, generally for petty expenses in
this voucher all the expenses are debited while the cash in hand credited. Cash payment
voucher is used only for the payment of less than Rs. 50,000.
b) Bank payment voucher
This voucher is used when the payment is to be made through bank and the transaction is
more than Rs. 50,000 in bank payment voucher all the expenses are debited while the
company bank account is credited.
c) Cash receipt voucher
This voucher is used when hard cash is drawn from the bank
d) Bank receipt voucher
This voucher is used when an amount is deposited in the account of sales office.
e) Journal voucher (JV)
The journal voucher is used for
When purchases are made by the company through credit
For gross amount
For adjustment of expenses


Confirmation of Deposit Slip

The account section also carries a computerized record for the customer balance.
Before any order is booked for the dealers, the deposit slip is to be confirmed from the
account section to see that whether he hold a debit balance or credit balance, if he has a
credit balance the order is booked for him and if the balance is in debit, he is not given
any kind of supply, first he must deposit cash.

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Bank Reconciliation statement

Bank reconciliation statement is prepared on daily basis in order to check the

accuracy of the Company cash book with the bank statement.



Checking All the Activities

Checking reports
The account section also performed the important job of verifying various types
of reports like booking schedule, booking journals, daily dispatch summary and customer
ledger. Usually amount received in the reports is checked and here after verified all the
company accounts vouchers, bank statements and reports are maintain in SAP financial
accounting module FICO.


The main collection account of the company is in MCB University town branch

Peshawar. The entire amount collected by all the banks is sent ultimately to this branches.


As Cherat Cement Company is also exporting cement to Afghanistan, therefore

all the documentation is done to complete all the requirements of exports.


E- Form
For the export documentation first of all a form is filled up by the manager of sales

office, this form is known as E-Form is verified by the bank in which the buying party has
deposit the amount for the purchase of cement. This amount is deposited in the form of US $. So
this form is also serves as a bank deposit slip for the export.

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Certificate of Origin
After the E-Form is being verified certificate of Origin is prepared, this certificate

of origin is purchased from the Sarhad Chamber of Commerce and also verified from by them.
The purpose of this certificate is to confirm that the product mentioned to be exported is being
produced or manufactured in Pakistan. After this the cement is dispatched, further documentation
is done, this includes commercial invoice which is a computer generated document.
This invoice includes quantity, description of the product, and the price (in dollars)
per ton, there is another document known as Performa invoice packing list is also attached with
these documents. Dispatch office sends some documents with the truck; they are, Application for
removal consignment (A.R), sales tax invoice, builty. All these documents are sent and they are
checked at the border, the bags are counted and checked that everything is fine, these documents
are verified here. At the border of Torkham a shipping bill is prepared and verified by three
officers who are; inspector, deputy superintendent and superintendent, they are the officers of
Pakistan Custom, all these documents are verified by the counsel general of Pakistan in
Jalalabad. When the documents are brought back to sales offices, bring back these documents is
the responsibility of the importing party of Afghanistan. Now the sales office some additional
documents are attached to claim for the duty drawback, these additional documents includes,
Application for rebute duty drawback, an undertaking on a stamp paper, this undertaking contain
a declaration from the company side that no other claims has been made for the rebate.


Computer Section
Computer section in the sales office is providing support to the different section

regarding the information technology. If any problem is occurred in the network or in an

application, so the computer section can resolved the particular problem. Cherat Cement
Company is completely computerized. All the main tasks like booking, planning, making of
invoices and acknowledgment slip etc, are done by computer. There is a separate computer
section in office, which constantly keeps an eye on all the activities. When booking is made, its

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record is saved in the computer section automatically through SAP. The record of all the booking
is then used by planning section daily for making plan, hard copies of all these are also kept.
The computer section plays a vital role in all flow of cement i.e from booking to
dispatch. And help to speed up the process. As all the record is computerized, it becomes very
easy to make the record update. Communication is important in this process. This is the area of
competition and survives in this competition. You have to be faster because even a single hour
delay may be proving costly. When dealers book, their consignments, they demand in time
delivery of the cement, it means plan should be made in short time and also the plan should be
sent to the factory immediately in order to make dispatches on the same day.
For this purpose computers are necessary. Booking and planning are done on
computers and time is saved because they work quickly and efficiently. Through computers by
using internet plan is sent to the factory and hence the work of hours is done in seconds. Before
the introduction of computers at the sales offices the booking process took hours and delivering
of plan to the factory also took a lot of time.
Realizing the need speed the CCCL has introduced computers in its all departments.
Even from the Lahore sales office the plan reaches factory in seconds. All the data saved in to
two hard disks at a time with the help of server. There is function of mirroring in the server.
Computer section also used Domain server which control the computer in the office. In the
computer section there are two servers installed for sale office, 1) lotus note and 2) SAP. The
SAP is main server was installed in the Karachi main office of the CCCL.


Marketing in CCCL work like the backbone of the Company. Marketing managers visit

the market see the demand of the cement, numbers of competitor in the market and the position
of competitor in the market. If demand is high in the market, manager appoints the dealer for the
area and supply cement to the dealer of this area according to booking.

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Admin section
The admin section of sale office Peshawar is responsible for the maintaining the date of

their employees regarding their leave, admin manager update the record of vehicles which the
company provided to his manager for their personal and official use. The second responsibility of
admin section is provides logistical support to the different section of the sales office and
dispatch office according to their requirements. The admin section is responsible for the
renovation of the sale office, dispatch office and M.D house. The admin section has the authority
to approve different expenses of the sales office Peshawar like vehicles charges and daily

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Chapter 3

SWOT Analysis

SWOT stands for strengths, weaknesses, opportunities and threats. A SWOT

analysis is a technique that many companies use during strategic planning, basically an organized
way to evaluate where to focus time, money and energy to improve productivity and growth. A
SWOT analysis can be a valuable tool for setting milestones or approaching a venture
investor, because it demonstrates a solid understanding of your company performance and the
factors influencing productivity.

Explanation of SWOT Analysis


Availability of raw material
The easy availability of the key raw material Gypsum, Shale and limestone all over

Pakistan gives a smoother start as which I think is a very good for any cement industry. And the
plants are installed quite near to raw material which is a competitive edge.
Cheaper labour
As we all know the labour of Pakistan is very cheap. So this is a healthy sign for the
company as the company has to pay less to their labours which results in saving of their
income and later on, can be utilized in the expansion of cement plant. Resultant increases the
cement production.

Latest machinery

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The plant of the company is equipped with the latest machinery having a latest
technology in Pakistan as compared with others. Although it is expensive but it saves the cost by
producing quality cement and creating value in mind of customers.
Self Power Generation
The company has its own power generation plants in the factory area so to meet the
plant requirements and we all know that Pakistan these days suffer with serious energy crisis, so
the company do not totally depends upon WAPDA even from its own generation the
company produces energy with much less cost. So I think it is another main strength that CCCL
have if compared with other cement industry because no other cement plants in Pakistan
have such energy generation system, and so they have to depend upon WAPDA.


Low Promotional Campaign
If we analyze this they are not paying much attention to promotional campaign. They

are not advertising their product as per requirement because through promotional campaign they
can also gain more market. They are only using trade promotions, which are not enough to have
a good positioning in the market.
No Performance Appraisal
T h e r e i s no proper performance a p p r a i s a l p r o g r a m . I f o n e w o r k s h a r d a n
d w a n t s t o s h o w c r e a t i v i t y his
performance is not appraised by any instrument. The managerial staff is n
ot promoted on the basis of performance, as they have no any tool to
m e a s u r e p e r f o r m a n c e o f managers. They only one way to measure the
performance which is annual confidential report, which is prepared by only one person
who is immediate boss of any employee.

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Seniority Issues
In management there is a seniority virus means there is no proper mechanism for the
promotion of the seniors. Experienced persons have a lot of experience and they know the
organization best and how to effectively run that organization. They know that what to
promote and what not to promote about the organization. This irregularity in
promotion of managerial staff creates job dissatisfaction and lowers down their
productivity. It may happen that staff is not dissatisfied with the job, but at the same
time they may not be satisfied with their jobs.
Centralized Decision Making
Although the decision making style of CCCL is decentralized that what the company
says but the ground reality is that in decision making process the middle level
management is not much consider by the upper management which creates sense of
irresponsibility among the members of company. So ultimately it creates job dissatisfaction.
Their decisions are not praised and honored much as they expect.


Location of Project
Location always matters, if we see in North and East KPK there is not enough cement

factories other than Cherat Cement. So we can say that there is somewhat monopolist in that part
and it controls the whole market. If the company upgrades its production capacity they have a
good chance to cover the foreign market of Afghanistan from that plant.
Export Demand
As there is a war like situation in Afghanistan and Iraq so there is a huge
demand of cement in rehabilitation process, most of Indian cement plants are in north region
so from there it costs a lot to reach in southern region so this also again is a huge market to be
capture, also there is a huge d e m a n d i n U A E a n d R u s s i a . R e s u l t t h e r e i s a h u g e
c a k e o f i n t e r n a t i o n a l m a r k e t w h i c h a company has a chance to cater.

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Rehabilitation and New Construction Projects in Country

As we all know theres started a rehabilitation phase in north areas of Pakistan after war
against m i l i t a n t s a n d i n S o u t h Waz i r i s t a n t h e r e i s a r e h a b i l i t a t i o n p h a s e t o
b e c o m i n g a n d a l o t o f projects have started in the country. So this increase in demand
creates a new opportunity for the company to earn more profit.


Increase in Fuel Prices
Increase in the international prices of coal and oil is a major threat. As

Pakistan coal contains high percentage of sulphur due to which the company is not able to
use the local coal as a source of energy. So the company has to import the coal from
different countries like South Africa, china and Indonesia at high prices. This will restrict
the profit margin.
Political Instability
That instability always remains threat to Pakistan and its cement industry also because
due to this theres not as much growth and now the war like situation in a country is really a big
High level of taxation
Presently, the company is heavily burdened due to levy of FED and
General Sales Tax @ 19% on duty paid value. In addition to Federal Excise Duty
and General Sales Tax, company is also paying the provincial levies (Royalty and
Excise Duty) on acquiring of raw material for production of cement i.e. lime stone, shale and

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Chapter 5




They should p a y attention t o their employees they should used performance appraisal

Top management should use up-to-date marketing practices rather to

use orthodox ideas. This is the age of advertisement and they should advertise
their product rather use push.
strategy. T h e y s h o u l d emphasize o n p u l l strategy a s

w e l l . T h e y have good, energetic, experienced marketing and sales team they should

use it constructively.
They should pay much attention to promotional tools. They should
advertise their product. They are only using trade promotions, which are not
enough to have a good positioning in the market. They should use other

promotional tools as well.

The middle level management should be involved in decision-making. In this

way they will f e e l s e n s e o f responsibility a n d t h e i r
productivity w i l l increase. Their loyalty w i t h t h e organization will also increase.

They should also introduce some employee recognition program. In this way
the employees will be more satisfied with their jobs and ultimately will be beneficial for
the organization in terms of high productivity.

Skills and performance based performance appraisal program should be


Employees should be promoted on the basis of their achievement.

Employees should be rotated in different jobs and tasks, as monotony
decreases productivity.

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Finding of reports
Working at Cherat Cement has provided me with an invaluable experience of

how the financial matters are run and solved. I had chosen to go into this field because of the
interest I had work in Finance. From the whole analysis, company has growing potential. As
Pakistani market is going to be liberalized, new players are entering all sectors including cement
sector, competition is going to be very intensive and severe.

T o remain market leader CCCL should reorganize its management policies regarding

placement, workforce a n d development. To gain and sustain competitive

advantage CCCL should change itself

continuously according t o local a s well a s

international market. Cherat Cement factory is the leading company in the cement sector The
Company is performing very well for the financial point of view. It pays a huge amount annually
in the form of taxes to the government of Pakistan. Companys distribution channel sare very
effective. The prices of Cherat Cement products are higher than the competitors due to the fine
quality, it provides. It can also be concluded that Cherat Cement Company should reduce the
prices of its products.

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