“A PROJECT OF MARKETING PLAN”

PRESENTED TO

PROF. DR. NADEEM AHMAD BASHIR

PRESENTED BY

MAZHAR HUSSAINI.D # 023111

ABDUL HAFEEZI.D# 023117

MUDASSAR HAMEEDI.D # 023392

MUHAMMAD NADEEM AHMADI.D # 023114

Institute Of Management Sciences Lahore

To the people who have worked

tediously through the ages to

uphold the principles of

determination, commitment and

devotion for the sake of

humanity.

ACKNOWLEDGEMENTWe wish to place on record our indebtedness to the following people for the

continuous support we received during the process of compilation of this report.

In particular to Dr. Nadeem Ahmad Bashir, our teacher, for his unrelenting interest,

keeping constant contacts and help that he gave during the process.

We are also thankful to Daewoo people for providing material relating to this report.

TABLE OF CONTENTS

1. Executive Summary 1

2. Daewoo International Corporation 2 Introduction General Information Company Chronology Departments Management

3. Daewoo in Pakistan 6 Introduction Why Daewoo in Pakistan? Start in Pakistan Investment

4. Services 8

5. Special Features 9

6. SWOT Analysis 10

7. Marketing Plan 11 Mission statement People vision Marketing objectives Target market Market positioning

8. Marketing Mix 13

Product Place Promotion Price

9. Conclusion & Recommendations 15

Executive Summary

The Diagnostic study on Daewoo Express Bus Service is indeed an

informative one. Daewoo came into Pakistan for the construction of

Motorway [M-2] Project. Then they were asked to operate their Inter

City Bus Service that was from Lahore to Islamabad. The government

of Pakistan proposed this, on November 11 1999, Daewoo started Inter

City Bus Service with a fleet of initially 20 buses, which was from

Railway Station Lahore to Choongi Amar Sadhoo. Then they gradually

increased their fleet and currently they are operating with 70 buses.

Daewoo is facing severe competition with Niazi Express. Other

franchise companies like New Khan Metro, Premier are also indirect

competitors of Daewoo.

As far as the financial situation of Daewoo is concerned, it had to bear

a large number of losses in its first two years of operations. But, it is

the growth phase. This can be judged from the fact that the

percentage of net loss was greater than 20 buses, and it reduced as

the number of buses increased to 70. So we can say that Daewoo,

though now not financially sound, has a strong tendency and in the

near future it will be a profitable enterprise. Express Bus Service

started working from 1998 with 40 buses and now they are at 64 and

also profitable.

Daewoo operates in the kind of industry where the entry barriers are

high. The reasons being a large amount of investment, equipment and

network are required.

The major weakness in the Daewoo Express and City Bus Services is

that their network is not extensive enough to accommodate most

areas. Even Daewoo City Buses are too much crowded.

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An increase in the number of routes and buses especially in the

Daewoo City Bus Service Department is the best way of tackling this

situation.

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DAEWOO INTERNATIONAL CORPORATION

Introduction

A locomotive for national economic development since its founding in

1967 as Daewoo Industrial Co., Ltd., today’s “Daewoo International

Corporation” is the new vanguard of Korean Trade. The company

played a leading role in overcoming economic crisis in 1998 by

achieving top results in export and trading surplus. Throughout its long

history, the company also played a major role as a vanguard in non-

governmental diplomacy. The company’s dynamic trade policies led to

the establishment of diplomatic ties with 13 nations as well as to the

expansion of export markets by setting up Korea’s first trade branch

office in 37 countries. Daewoo Corporation was reorganized into three

new companies in order to normalize all operations: Daewoo

International Corporation in trade, Daewoo Engineering and

Construction Co., Ltd., in construction and Daewoo Co. in others.

Having normalized operations, Daewoo International is leaping into the

new millennium with more than three decades of international

marketing expertise, international trading man power, high quality

products and all inclusive domestic and international sales networks.

With such reliable qualifications, the company looks forward to

positioning itself as a truly global leader in world trade.

With its own distinctive technology and development capabilities,

Daewoo international has been, for more than three decades, a

worldwide name for fine quality products. Now, with new

environmentally friendly materials, the company augmented its

renown and reliability in material for footwear, garments, car interiors

components and miscellaneous goods. First in Korea to acquire ISO

9002 and QS 9000 quality certification in its field, the company

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continues to expand its global exports and develop new trade

strategies. With its solid capabilities in manufacturing technology and

improvements in both process and quality, Daewoo International is

steeping into the new millennium with top competitiveness, top

products, and top services.

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General Information

Name of the company Daewoo International Corporation

CEO Lee Tae-Young

Address

541 5- Ga

Namdaemunno, Chung Gu, Seoul,

Korea, G.P.O Box 2810

Phone 082+2-759-2114

Fax +82+2-753-9489

Company Chronology

Mar. 22, 1967Established as Daewoo Industrial

Co., Ltd

Jan. 1, 1982Merged with Daewoo

Development Co., Ltd;

1998Ranked first in Korea in exports

and trade surplus

Number of staff: Approx. 9000

Overseas network: Subsidiaries: 70

Branch offices: 49

Major business areas:

International Trading, Overseas

Resources Development,

Domestic and Overseas

Investment Business Overseas

Projects, etc.

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Organization 10 Division, 51 teams

Departments

Corporate Restructuring

Finance

International finance and overseas management

Office of management

Staff of legal affairs

Management

With 30 years of experience, Daewoo’s Management Development

Center recently introduced new visions to foster personal efficiency

and advancement. The center is initiating a number of systematic new

programs for employees, as well as innovative steps as the leading of

training facilities, operation of consignment training, and public

lectures.

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Daewoo in Pakistan

Introduction

As Daewoo has a name all over the world due to interest in

automobiles, consumer goods, financial and securities, construction,

engineering and trade sector, Daewoo is working for the last thirty

years and their motto is “from tile till ship”.

Daewoo, a top Korean company, emerged in Pakistan in 1993, when it

sort $1 billion in Lahore- Islamabad Motorway Project which was highly

political in nature. Though it discouraged in getting more projects but

with the re-election of Nawaz Sharif Government, Daewoo has come

with its renewed commitments in taking part in development related

activities.

In the first phase, company would import buses from Korea and

intends to invest $60 million in its transport venture which would have

600 buses fleet in total. Company source says that it is also

considering installing a bus assembling plant to take part in the

massive demand of passenger transport.

The company commenced its business on December 10, 1997 after

obtaining certificate for commencement of business from registrar of

companies, Lahore. Daewoo Pakistan Motorway Services Ltd. was

incorporated as a public ltd. company on October 23, 1997. The object

of the company was to provide services on Lahore- Islamabad

motorway.

Daewoo Pakistan Express Bus Services Ltd. was incorporated as a

public ltd. company by shares with the object of engaging in

transportation business. Their detailed description activities are:

To plan, survey, design, finance, construct, own, operate and

maintain bus services.

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To carry on the business of transport of goods, mails,

passengers, animals from place to place either by air, by land or

sea whether in airplanes, motor-vehicles, cars, ships or in any

manner what so ever.

To indulge in higher transportation services in all the parts of the

world.

Starting in Pakistan

In May 1999, Daewoo signed memorandum of understanding with the

Government of Punjab at Seoul, Korea to operate 1500 buses in

Pakistan out of which 700 buses were proposed to be operated in

Punjab whereas 800 buses in Sind.

It was also agreed that government would provide the requested funds

for this project from outstanding payment on the construction of

Lahore-Islamabad Motorway Project. Anyhow, this agreement could not

be materialized and due to the certain reasons and eventually Daewoo

had

to arrange funds for import of 50 buses through financial institutions

and those maintain its commitments made with the citizens of

Pakistan.

To operate the city bus in Lahore, a franchise agreement was signed

on August 3, 1999 between Daewoo and Lahore Regional Transport

Authority, Government of Punjab.

Investment

To commence its business on January 12, 1998, after obtaining

certificate for commencement of business from Registrar of

Companies, Lahore, the company has planned an initial equity

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investment of US $ 1 million. The total cost of the project has been

estimated at $ 6.526 million, which the company proposes to finance,

by equity investment of $ 5.095 million and by loan arrangements of $

1.431 million. In this project, as well, Daewoo wants 100% equity in the

project instead of 60% allowed.

Services

There are two types of services that Daewoo is providing in Pakistan

which are as follows:

1. Express Bus Service

2. City Bus Service

Express Bus Service

This is the inter-city bus service of Daewoo International Corporation in

Pakistan.

Major routes

Lahore - Islamabad

Lahore - Multan

Lahore - Sargodha

Lahore - Faisalabad

Rawalpindi - Murree [wagon]

Lahore - Peshawer

City Bus Service

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This is the intra-city service of Daewoo International Corporation in

Lahore, Pakistan. This department offers an extensive transportation

network within Lahore through a fleet of 70 buses.

Daewoo is also considering the launch of this service in other

metropolitans such as Karachi.

Special Features[Daewoo Express]

It provides its services from cities to cities comparatively to the other

companies, Daewoo aims to provide following services for their

customers:

Smooth drive with reclining seats

Refreshment

Audio/Video entertainment

Centrally heated and air-conditioned

Reservation facilities

Pick and drop facilities

Punctual departures and arrivals

24 hour service

Computerized ticketing

Courteous hostesses

Armed security guards

Cargo service

Expert drivers

All these points are advantages for Daewoo over all the other

transportation companies in Pakistan.

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SWOT Analysis

Strengths

1. Brand name

2. Unique Service

3. State-of –the-art equipment

4. Professional management

5. Trendsetters

[in transportation]

6. High traveler satisfaction

7. Extensive Employee

Training Program

Weaknesses

1. Lack of an extensive transport

network

2. Over crowding of vehicles

3. Insufficient marketing

intelligence

Opportunities

1. More buses, routes and a

greater range of transport

network

2. Better management of

available resources

3. Innovative Marketing

Threats

1. Well established competitors

2. Government policies

3. Fluctuation in fuel prices

4. Up coming companies

5. Intensive disturbances on the

roads

6. Non-availability of spare parts

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MARKETING PLAN

BUSINESS MISSION

“We envision growing in the shortest possible time into number one traveling

company in Pakistan with the unique ability to meet the needs of consumers of

every age group for facility and pleasure through development of highest quality

and customer-care services.”

PEOPLE VISION

We envision the company to develop an extremely motivated and professionally

trained work force, which would drive growth through innovation and renovation.

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MARKETING OBJECTIVES

The fiscal and political policies and economical conditions of the government and its

efforts are creating a generally business friendly environment are likely to help in the

economic turn around. The international community is supplementing these efforts to

overcome economic difficulties. These indicators are holding out the hope that the year

2004 may be better for business. However, it is early to say with any finality how

business will develop, given certain uncertainties that still prevail. On our part we are

confident that we will maintain our growth momentum and perform well in the coming

year. Our focus will remain on a long-term view of the business, quality consciousness

and efficiency through innovation and renovation in all areas of operation.

TARGET MARKRT

Our target customers are middle and upper class citizens who think time is more precious

than money and sufferings of using conventional traveling medias.

MARKET POSITIONING

We want positioning our company as the company, providing comfortable traveling

experience with a nice cooperative and friendly staff.

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MARKETING MIX

PRODUCT

Daewoo will provide traveling services using innovative techniques and modern

technologies with a friendly and gentle environment.

PLACE

The company will make sure that service is available throughout the country at all the

suitable locations.

PROMOTION

Effective marketing remains the hallmark of Daewoo as a company involved in supplying

services with a great emphasis on effective long-term strategies. Its services (traveling,

pick & drop, cargo etc) will be promoted through out the country using a network of bus-

stations.

It will ensure consistent and balanced growth, despite adverse market conditions. As a

result, Daewoo will enjoy an extremely high degree of recognition and reliability, which

has earned leadership positions for most of its services. Its more and more branches will

be initiated in other cities where demanded.

PRICE

After developing their pricing structures and strategies, companies often face situations in

which they must initiate price changes or respond to price changed by competitors. In

some cases, the company may find it desirable to initiate either a price cut or a price

increase. In both cases, it must anticipate possible customers and competitor reactions.

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Several situations may lead the firm to consider setting its price. One such circumstance

is excess capacity: In this case, the firm needs more, business and cannot get it through

increased improvement or other measures. It may drop its "follow-the-leader pricing"—

charging about the same price as its leading competitor—and aggressively cut prices to

boost profit.

A successful price increase can greatly increase profits. For example, if the company's

profit margin is 3 percent of fare, 1 % price increase will increase profits by 33 percent if

fare volume is unaffected.

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Conclusion and Recommendations

1. Daewoo is an international brand and through its high quality

and exclusive services, it has gained a good repute in the local

transport business. But it has been seen that Daewoo

Corporation has not lived up to its name as far as the

establishment of an extensive transport network is concerned.

Passengers in most areas of Punjab and in all the other provinces

of Pakistan have no access to the Daewoo Bus Services. There is

also a great need for an inter city transport network of Daewoo in

metropolitans such as Karachi, Rawalpindi and Faisalabad etc.

This problem can be dealt with by increasing the no. of inter city

and intra city routes and buses as well as increasing the range of

transport services.

2. It has recently been observed that following a tremendous

growth in the number of passengers, Daewoo Intra City Bus

Service has suffered great over-crowding which has deteriorated

the standard of comfort claimed by the company.

One probable solution to this problem is again an increase in the

no. of transport vehicles and routes. Moreover, a better handling

and management of the present bus routes and the number of

buses can also lead to a more pleasant situation.

3. I was quite shocked to know in my meeting with Executives of

Finance and Marketing of Daewoo, Pakistan that no advertising

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campaign has ever been launched to highlight the comparative

superiority of the company over its local competitors.

Consequently, a large proportion of consumers remain unaware

of the great facilities afforded by the bus service.

Therefore, advertisement is a feasible and necessary way for the

bus service to attract passengers who are unfamiliar of the high

class and uniquely elegant transportation experience- offered by

Daewoo- and hesitate when spending on the comparatively high

Daewoo bus fair.

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