Daw Lance
Daw Lance
Daw Lance
Dawlance United Refrigeration Industries Ltd. was established in 1980 by its owner Mr. Bashir Dawood. It is
one of the largest companies in Pakistan engaged in appliance business. Dawlance stands for durable &
reliable household appliances. Initially Dawlance started business with refrigerator manufacturing but now it
has progressed with making refrigerators, deep freezers, washing machines, small l appliances, air conditioners,
televisions etc. It has five factories and 21 sales centers in Pakistan. The main Objective is to provide
dependable and reliable product at reasonable price to majority of the people of Pakistan and to enhance their
quality of life. The key players apart from Dawlance are LG, Haier, Waves, Pel and Orient.
(Since my childhood, I have been seeing DAWLANCE. And the first thing that comes into my mind
after the Brand Name is a deep-freezer and a model saying dawlance reliable hai. Not only did it
prove itself in the making a reliable product but also became one of the largest appliances company in
Pakistan. The company started 1980 by Mr Bashir Dawood, when it only used to manufacture
refrigerator. By now the company has progressed so well that it is manufacturing washing machines, air
conditioners, television sets, and other small appliances. It has five factories and 21 sales centers in
Pakistan, and, it has only one aim to make a reliable and dependable product at reasonable price to the
masses of Pakistan).
The vision of Dawlance is to keep their customers satisfied by providing high standard products. And with the
help of its tagline Kyun Ke Dawlance Reliable Hai they are directly creating a USP in the minds of
customers. Dawlance has become the first home appliances company providing customers with a wider range of
products at reasonable prices thus getting successful in the market.
Dawlance has entered the local market with a commitment to help its consumers reap the benefits of modern
lifestyle and to provide them world-class innovative products, unmatched nationwide customer support, a vast
dealer network and a steadfast after- sales-service throughout the country.
(the idea of Dawlance is to satisfy its customers by providing high standard products. By using the
tagline Kiun ke Dawlance Reliable hai it promoted its USP to the customers. Dawlance has become
the first home appliances company that offers a wide range of products at affordable prices making the
company successful in the market. It has always been committed in giving its customers innovative
products of international quality standards, giving access to its customers to modern-day technology in
any appliance they manufacture followed by unparallel after-sales services and customer support across
the country.)
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In addition, there is one service outlet at Gulshan-e-Iqbal and three retail outlets named as ELECTRIC CITY
which are located in Defence, Landhi and Gulshan which has a very vast customer base. They cater to Middle
and Upper-Middle-Class.
Dawlance is a leader and technology innovator in home appliances industry, the major reason is being its strong
brand name in the mind of customers.
Market Summary
The demand of home appliances is very high in Pakistan that is why we see a lot of competing firms in the
market both local manufacturing and international (non-manufacturing firms) in Pakistan. We also see that
Dawlance is one of the most efficient and competing firms in Pakistan and is continuously growing. It currently
has 5 factories and 21 sales centers in Pakistan and is in direct competition with international brands such as LG
and Haier.
Target Market
The target market of Dawlance is dived into different segments because of wide range of products available and
catering to different segments. They do not only cater to households, but also directly to Dealers, firms, and
hyper markets such as superstores, retail outlets etc.
Though more of their focus still remains on households, as these business entities often switch to other brands
due to price related issues and are not considered loyal at all
Market Segmentation
Consumer diversity is increasing rapidly and firms have long sought to differentiate their products relative to
competitors. The objectives of market segmentation are to more accurately meet the needs of selected customers
in a more profitable way. Dawlance customers consist of demographic, geographic and behavioral factors which
are briefly described below.
Demographics of customers
Gender: The home appliances offered at Dawlance are for masses (both male and female). Basically every
family need home appliances which enables them to work better and with ease. But it has observed that, females
generally tend to come and make decisions regarding the purchase of products.
Age: The age bracket of the families that purchase products range from 25-70 years of age.
Income: There customer have an income of at least 15,000 and above, belonging to a social class ranging
between lower-middle, middle-middle, middle-upper to upper-upper class.
Occupation: Though any person belonging to any occupation have to buy home appliances.
Geographic segmentation
Dawlance is basically catering to households as well as businesses. Residents from all over Pakistan are the
target market. The businesses that Dawlance caters to include Srilankan firms who import Dawlance and sell it
with a differing name in their country. In Karachi, people from Defence, Gulshan-e-Iqbal, Tariq road,
Bahadurabad, Clifton etc. and from surrounding areas like saddar, burns road, kharader etc are catered.
Behavioral variables
Loyalty Status: The customers that fall under this segmentation are those who are loyal to Dawlance,
and tend to choose products of Dawlance while comparing with others companies because of their past good
experience with the firms product. Some customers do favorable word of mouth publicity regarding a product,
telling friends and family, thus adding them to the number of loyal customers.
Market Needs
The demand of home appliances has been increasing in Pakistan. The increase in demands for consumer
utilities is mostly because of the higher level of consumer awareness in the market due to exposure to a lot of
consumer products through the media (advertisements). The general rise in literacy rate is also one of the
reasons for more aware and active market. Also, the increase in disposable income levels in families is also a
cause that lead to change occurring in consumer lifestyles.
Market Growth
In Pakistan, Home appliances like refrigerators, microwave ovens and television are most popular. The demand
for consumer utilities is by and large seasonal. For example, the sales of air conditioners and cooling products
may increase in summer months, whereas other entertainment systems sales may increase during a festive
season, when there are some discount options are available. There are so many companies offering consumer
households in Pakistan such as LG, Samsung, Hitachi, and Haier etc. so the competition is however tough;
with many competitors present in the market, variety and offerings vary with respect to various attributes such
as price, quality etc.
Organogram
Board of Directors
Mr. Ameer
(Manager
Operations)
Mr. Shakeel
Aziz
Mr. Azam
Aziz
Mr. Adnan
Nazeer
(Factory
Manager)
(Factory
Manager)
(Factory
Manager)
Marketing
(Mr. Hassan
Jamil)
Managing
Director
(Director Finance)
Finance
Mr. Haneef
Services
IT
Sales
(Mr. Rasheed
Jamil)
(Mr. Salman
Rehmatullah)
(Mr. Mazhar
Qayum)
Quality
Assurance
(Mr. Amin
Ahmed)
HR
Imports
(Mr. Tim
Saudi)
(Mr. Raja
Adeel)
ambassadors for the organization. Interns also help generate new ideas which might be fruitful for Dawlance in
the long run.
5.
Physical Environment:
The service centers of Dawlance located near Gulshan-e-Iqbal creates maximum number of footfalls since it is
visible to many people. The majority of the target market is in the nearby area of Gulshan-e-Iqbal and Gulistane-Jauhar. The items displayed are clearly visible and is up to the reach of the customers so that the customer can
have a look at the products and can compare it easily. The space is spacious and is huge enough to entertain a
lot of customers. The inventory is kept well before the demand rises.
6.
Process:
As soon as the customer registers complain through phone call at Dawlance services department, the technician
is informed. The technician duty is to response within 2 days to the customer to solve the registered problem.
After examining the problem, the technician solves the problem right away if it is a minor one, otherwise the
product is sent at the Dawlance service center for repairing. Dawlance bears the transportation costs if the
product is under warranty. Also, there is the concept of one free visit for each customer for the first time. This
again helps in capturing the market share by creating loyal customers.
7.
People:
The people at Dawlance are very cooperative and loyal to their customers. The service centre provides complete
help to those who have any issues or problems with their product and require after sales services. The
employees are highly motivated, and are trained to provide professional service to their customers. Technicians
at Dawlance response within 2 days to its customers which is a clear example of the good service that they
provide.
SWOT Analysis
Strengths:
1. Dawlance has a total of Five (5) Factories all over
Pakistan
Weaknesses:
1. No Complain outlets.
2. Marketing the products have been low in this age
of time.
3. No or low use of social media advertising which
can help in increasing the brand presence.
Threats:
1. The competitors provide dealers with better
discounts and profits. Hence dealers tend to sell
their products more often than Dawlance.
Competitor Analysis
The analysis (Table 4) of competitors shows that Dawlance has a second highest score. LG has a
competitive edge over Dawlance because it has a worldwide network, its services and various number of
product lines. However, Dawlance enjoys market leadership in refrigerator and microwave ovens
category in Pakistan. So they should concentrate to overcome their weaknesses and take advantage of
their opportunities. They have to enhance the quality of after sales services which will exceed customer
expectation so that it will create delight.
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Quadrant 1
DAWLANCE
Quadrant 2
Weak Competitive
Position
Strong Competitive
Position
Quadrant 3
Quadrant 4
The grand Strategy matrix shows that Dawlance located in Quadrant 1 of the grand matrix strategy which
means that Dawlance is in an excellent strategic position. It has strong competitors like LG, Samsung, Haier,
PEL etc. In order to maintain its position, Dawlance need to emphasize more on other strategies like market
penetration, market development, and/or product development. They could invest more money for customer
benefits and open new outlets to cater new customers or nonusers by providing value added services.
Space Matrix
This space matrix (Table 5)
tell us that Dawlance pursue
an aggressive strategy. It has
a strong competitive position
in the market with rapid
growth. Dawlance can use its
internal
strength
advantage
of
opportunities,
internal
to
take
external
overcome
weaknesses,
and
develop
penetration
and
market
market
QSPM Analysis
According to the QSPM matrix (Table 6), Dawlance follows market development strategies in order to
capitalize its opportunity in the wake of internal and external critical success factors. In reality however, each
and every product has a different stage that is followed. For refrigerators, the firm follows market maintenance
strategies because of already being a market leader. The Microwave oven is in the growth phase but because
majority of the Pakistani population (rural areas) do not know how to use a microwave oven hence it is
basically in its growth phase in Pakistan. However, Dawlance is a market leader in Pakistani microwave
industry for urban areas. The Washing machine is a tricky category as it is in its maturity stage however; semiauto washing machines are in its growth phase because people are not use to semi-automatic machines because
of various factors such as electricity problems, maintenance, cost of repair etc. and automatic washing machine
concept is still new in Pakistan with still not willing to use it. The Deep freezers category is at its maturity stage
but Dawlance is focusing on reinvention to create value for the product that creates competitive advantage for
Dawlance. Therefore, overall the organization is following market development.
provided to dealers from the nearest warehouse. In case stock is not available in the warehouse then it is
delivered directly from Hyderabad Factory. The maximum delivery time incase stock is delivered from
Hyderabad Factory is four (4) days. However, if supply is given from closest warehouse then it hardly takes 2-3
hours time. They believe that, timely delivery of their product to the dealer is one of an important element in
their success.
RAW
MATERIAL
(Kits Ordered)
PLANNING
(Forecasting)
INVOICING
BRANCHES
WARE HOUSE
PRODUCT MANUFACTURING
(At Factories in Hyderabad
and Karachi)
Financial Analysis
In the fiscal year 2008, Dawlance made total sales worth Rs 16 Billion which is a very excellent figure. This
shows that the financial position of Dawlance is strong and the organization has the capacity to implement R&D
to capture rest of the market share. Each year the organization is focusing its key strategies of customer
reliability and convenience to boost sales.
Minor Symptoms
1.
One of the symptoms is the communication gap between customers and Dawlance representatives. The
organization does not have a TOLL FREE number for customers to communicate easily and have to rely on
local repairers and/or dealers for basic issues that might occur such as earthing problems, gas refilling etc. after
buying the product or to claim warranty. The dealer also contacts the services department for claim of warranty
so it would be better if customers contact the services representatives directly.
2.
There are no such active loyalty programs in effect. Benefit programs such as rewards are not implemented to
create more of customer value in order to increase market share.
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3.
In connection to the previous point, sales efforts are restricted only to dealers in terms of providing facilities of
transport of products for convenience etc. while not focusing more on how to improve the customer after sales
experience to increase sales. An example would be providing less warranty (three year only) to customers for
products parts, while competitor (such as PEL and LG) provides five years of warranty on parts.
Minor Problem
1.
The customer point of communication not considered as important relative to dealer. Since Dawlance has very
strong industrial base as well as good marketing network in Pakistan, they do not feel any threat from any of
their competitors, either local or from importers. Thus they have ignored customers point of view relative to
dealers and believes that dealers play a decisive role in customer buying behavior process.
Major Symptoms
1.
The customers are deprived of the basic right to complain to the organization directly and have to rely solely on
the dealers to avail warranty claims if something goes wrong. This causes a lot of problems and may force
customers to shift to competitors.
2.
Dealers also have a communication gap with sales department of Dawlance because of lack of enterprise
technology incorporation within the organization. Dawlance is not able to track all the sales with dealers on a
regular basis: if the products are not sold, the sales department might think the dealer is unwilling to keep
Dawlance products while the problem in reality might be different (sales might be slow). This causes problems
in partner relationship management between the dealer and Dawlance.
3.
Lack of IT investments
The lack of an Enterprise Resource Planning (ERP) is causing almost all of the minor problems that the
organization currently faces. The reason behind not implementing the ERP in an organization that is ranked at
7th position in South Asia for one of its product (refrigerators) and is locally one of the best local manufacturers
in terms of quality, pricing and reliability is rather a concern. The organizations lack of investment is creating
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problems in partnership relationship management locally and internationally. Implementation of ERP can help
coordinate the front line and the support departments and connect the organization properly for effective and
efficient communication with dealers and customers as their major clients (through integration soft wares and
websites)
Major Problem
Dawlance is a typical Seth oriented company. The managing director, Mr. Bashir Dawood is the sole runner of
Dawlance and takes all decisions. The son of Mr. Dawood is not interested to carry on with the work of his
father. With this reality and a fact that Mr. Dawood would have to retire someday from his post, he is now
trying to bring in the dire needed change in the organization. In accordance with the change concept, Mr.
Dawood brought consultants from India to revamp all the process and departments functioning inside Dawlance
and to make it much more decentralized, giving authority to heads of departments to implement actions
necessary for the firms benefit in the long run, this giving empowerment to employees.
However, the concept of change that he thinks should be implemented has become a problem: it is the
resistance of employees, especially factory workers that has caused much of a real concern to Dawlance. The
major problem is employee frustration: with new functions and processes coming, employees feel more
frustrated which has resulted in 20% slower response since the change in system. The employees who have
been working there for the past 6-7 years are not satisfied with the new and different working conditions and
this has caused a slowdown in the work process in all departments and thus in responding to customer queries
and problems. According to one of the employees, much of the work is repeated again and again in the new
process which is causing slower process time. This, as a result causes a trickle-down effect causing all
departments to slow down. Therefore, the real challenge now is how to deal with the change and how to take
employees on board so that they work efficiently. And also how to specifically take all the departments on
board and assign investments efficiently so that they do not lag behind which would ultimately lead to customer
dissatisfaction.
Recommendations
After analyzing all the major and minor problems these are the following suggestions for the Dawlance.
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This is one of the major problems of Dawlance. They have few complain outlet therefore customers are facing a
lot of problems and this may force them to shift to competitors. Dawlance is financially stable and should invest
more money for customer benefits
Sales representatives have to face many problems regarding their tracking system. They still work on FoxPro
which causes problems with dealers. So they should implement Enterprise recourse planning (ERP) systems
which enhance all the activities of management, achieve efficiencies and customer satisfaction. It is important
to have a system which can support managements intention of growth.
They have to seek a solution to reduce the communication gap between the sales department and dealers. As
we mentioned above, they have to implement a system which helps them to track their inventories and
coordinate with their dealers easily. As far as dealers point of view, they could share their views and problems
related to their products.
The main aim of Dawlance is to provide better service to their customers than their competitors. They should
improve the call center facilities and open the lines of effective communications with their customers which will
give them direct constant market reaction to their products, services and performance. And this is far better than
any market survey. On the other hand they could help their customers, which may force them to stay with
Dawlance for a long term.
According to our observations, Dawlance is more focusing on dealers for sales while not on customers. It
should provide some customer benefits program which will assist them to increase customer loyalty, awareness
and engagement. They can give some discounts for their loyal customers, at the same time they can give some
gift hampers which exceeds customer expectations.
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Dawlance has a website but it is not functioning properly. They should set up a proper site to grow their
business and capture new customers. With the help of website they can reach customers, clients, and supporters
who would never come across their organization, and they can build up relations with people which they
already know and meet new people.
Future Outlook
Dawlance in the long run now looks forward to expanding its market locally and abroad. According to the
representatives, Dawlance is looking forward to exporting its finished products to countries other than Srilanka
and Thailand. Locally, they are looking forward to develop the market by entering into various other products
because of its powerful and reliable R&D. Dawlance also looks forward to counter recession oriented sales drop
in the future and one of its strategies has already been implemented as it has recently slashed prices of its
products for customer convenience.
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