Industries

?ANALYSIS OF OIL AND GAS MARKETING SECTOR- AN OVERVEW OF ITS GROWTH OVER THE LAST FIVE YEARS (2001 – 2005) AUTHOR: Akhlaq Ahmad Enroll No. 111031-004 Cell no: 03215008455 BBA-6 (Morning) SUPERVISOR: Mr. Musbashir Sadiq Bahria Institute of Management & Computer Sciences, Bahria University Shangrila Road, Sector E-8, Islamabad ABSTRACT Pakistan’s economy is undergoing significant structural changes since 1999-2000. The real GDP growth is accelerating over the last five years. Over the next five years, 7-8 percent growth is targeted to be sustained, which will demand a huge rise in the energy use.

The energy sector in Pakistan comprises of oil, natural gas, power (hydro and nuclear) and coal. The oil and gas sector has a lot of potential in Pakistan. Pakistan is classified as low priority by foreign investors because of the unstable economic and political situation. However, efforts are being made by the Government to promote investment in the oil and gas sector, by various incentives such as liberal granting of exploration licenses, restructuring and reform of the oil and gas sectors, deregulation of prices, and privatization of selected assets.

The reform has enhanced transparency, making decision makers aware of the various The objective of this thesis is to analyze whether the Oil and Gas sector in Pakistan has really progressed and whether there are better opportunities for investment and growth in this sector now than there were in the past. For the purpose of determining the trend of growth in the Oil and Gas Sector, four Oil and Gas Marketing Companies (O&GMC) were selected and their financial data analyzed over a period of five years (2001 – 2005).

Financial data relevant to the sample companies was gathered from published accounts of the companies, in their annual reports. This data was condensed and summed up for the four companies and presented in tables and then used for analysis. The results were held to be representative of the entire Oil Marketing Sector and seem to show a marked trend of growth in the financial indicators reveal that there has been a marked improvement in the growth of this industry. ACKNOWLEDGMENT First of all I am very much thankful to ALLAH ALMIGHTY, who gave me strength & power to complete this task efficiently & effectively.

I am also very much thankful to my parents who gave me the basic knowledge of how to read & write, who also prayed for me every time, especially in the hour of need & trouble. Thanks to my most prestigious Supervisor Mr. Mubashir Sadik for providing me guidelines for each & every aspect. Thanks to Mr. Abdul Ahad Maud and Mr. Faisal Subhan who were very cooperative and considerate during the whole period of data collection. I am also very grateful to all those who helped me & gave me up-to-date information or any other information regarding this analysis while completing this task. Thank you in anticipation.

DADICATION TO MY LOVING PARENTS TABLE OF CONTENTS ABSTRACTi ACKNOWLEDGMENTiii DADICATIONiv TABLE OF CONTENTSv LIST OF TABLESvi LIST OF FIGURESix CHAPTER 11 INTRODUCTION1 Broad Problem Area/Background1 Rationale5 Problem Statement6 Objectives of the study7 Research Questions8 Limitations9 CHAPTER 210 LITERATURE REVIEW10 CHAPTER 315 METHOD15 Procedure17 CHAPTER 421 RESULTS AND DISCUSSION21 CHAPTER 566 CONCLUSION AND RECOMMENDATION66 Conclusion66 Recommendations 68 GLOSSARY 69 REFERENCES73 LIST OF TABLES Table 4. 1: Pakistan State Oil Company Limited Balance Sheets (2001-2005)21 Table 4. : Pakistan State Oil Company Limited Income Statements (2001-2005)22 Table 4. 3: Pakistan State Oil Company Limited Vertical Common Size of Balance Sheets (2001-2005)23 Table 4. 4: Pakistan State Oil Company Limited Vertical Common Size of Income statement (2001-2005)24 Table 4. 5: Pakistan State Oil Company Limited Horizontal Common Size of Balance Sheets (2001-2005)25 Table 4. 6: Pakistan State Oil Company Limited Horizontal Common Size of Income statement (2001-2005)27 Table 4. 7: Shell Pakistan Limited Balance Sheets (2001-2005)28 Table 4. : Shell Pakistan Limited Income Statements (2001-2005)29 Table 4. 9: Shell Pakistan Limited Vertical Common Size of Balance Sheets (2001-2005)30 Table 4. 10: Shell Pakistan Limited Vertical Common Size of Income Statements (2001-2005)31 Table 4. 11: Shell Pakistan Limited Horizontal Common Size of Balance Sheets (2001-2005)32 Table 4. 12: Shell Pakistan Limited Horizontal Common Size of Income Statements (2001-2005)34 Table 4. 13: Sui Northern Gas Pipelines Limited Balance Sheets (2001-2005)35 Table 4. 14: Sui Northern Gas Pipelines Limited Income Statements (2001-2005)36 Table 4. 5: Sui Northern Gas Pipelines Limited Vertical Common Size of Balance Sheets (2001-2005)37 Table 4. 16: Sui Northern Gas Pipelines Limited Vertical Common Size of Income Statements (2001-2005)38 Table 4. 17: Sui Northern Gas Pipelines Limited Horizontal Common Size of Balance Sheets (2001-2005)39 Table 4. 18: Sui Northern Gas Pipelines Limited Horizontal Common Size of Income Statements (2001-2005)40 Table 4. 19: Sui Southern Gas Company Balance Sheets (2001-2005)41 Table 4. 20: Sui Southern Gas Company Income Statements (2001-2005)42 Table 4. 1: Sui Southern Gas Company Vertical Common Size of Balance Sheets (2001-2005)43 Table 4. 22: Sui Southern Gas Company Vertical Common Size of Income Statements (2001-2005)44 Table 4. 23: Sui Southern Gas Company Horizontal Common Size of Balance Sheets (2001-2005)45 Table 4. 24: Sui Southern Gas Company Horizontal Common Size of Income Statements (2001-2005)46 Table 4. 25: Oil and Gas Marketing Sector Consolidated Balance Sheets (PSO, Shell, SNGPL, SSGC) (2001-2005)47 Table 4. 26: Oil and Gas Marketing Sector Consolidated Income Statement (PSO, Shell, SNGPL, SSGC) (2001-2005)48 Table 4. 7: Oil and Gas Marketing Sector Vertical Common Size of Balance Sheet (PSO, Shell, SNGPL, SSGC) (2001-2005)49 Table 4. 28: Oil and Gas Marketing Sector Vertical Common Size of Income Statement (PSO, Shell, SNGPL, SSGC) (2001-2005)51 Table 4. 29: Oil and Gas Marketing Sector Horizontal Common Size of Consolidated Balance Sheet (PSO, Shell, SNGPL, SSGC) (2001-2005)52 Table 4. 30: Oil and Gas Marketing Sector Horizontal Common Size of Consolidated Income Statement (PSO, Shell, SNGPL, SSGC) (2001-2005)53 Table 4. 31: Important figures to be used in the calculating the ratios54 Table 4. 2: Ratios for measuring the Liquidity of the sector 55 Table 4. 33: Ratios for measuring the Long Term Debt Paying Ability57 Table 4. 34: Ratios for measuring the profitability of the sector59 Table 4. 35: Ratios of the measurement of the market value of the sector63 LIST OF FIGURES Figure 4. 1: Ratios for measuring the Long Term Debt Paying Ability55 Figure 4. 2: Ratios for measuring the Long Term Debt Paying Ability57 Figure 4. 3: Ratios for measuring the Long Term Debt Paying Ability59 Figure 4. 4: Ratios for measuring the Long Term Debt Paying Ability61 Figure 4. : Ratios for measuring the Long Term Debt Paying Ability63 Figure 4. 6: Graphs to specify the growth of the oil & gas marketing companies65 CHAPTER 1 INTRODUCTION Broad Problem Area/Background It is universally recognized that energy is one of the most important inputs for economic growth and national development. The consumption of energy is one of the critical indicators of the level of development of any country. Developed countries use more energy per unit of economic output and far more energy per capita than developing countries.

Economic growth is the key to this situation and for economic growth we need energy. Pakistan’s economy is undergoing significant structural changes since 1999-2000. The real GDP growth is accelerating over the last five years. Over the next five years, 7-8 percent growth is targeted to be sustained, which will demand a huge rise in the energy use. The energy sector in Pakistan comprises of oil, natural gas, power (hydro and nuclear) and coal. The total primary energy supplies measured in terms of oil equivalent (toe) stood at 50. million tonnes in 2003-04. Oil and gas account for almost 80% of the energy sector of Pakistan with oil and gas being 29. 9 percent and 49. 7 percent respectively. In order to measure the growth of the energy sector the best proxy might be to evaluate the performance of the oil marketing companies. As these are the companies which are not only selling the oil based products which meet the major needs of the energy in Pakistan but also these companies are dealing in the recently made popular Compressed Natural Gas.

As this Oil and Gas sector represents more than 80% of the energy consumed in Pakistan so the companies which are dealing with the marketing of these fuels need to be assessed for their financial performance and results in the past few years. If these companies are showing growth we might assume that the energy sector is growing and the economy is on the right path. The first gas field was discovered in at Sui in 1952 and provides the basis for Pakistan’s extensive gas network. Pakistan imports crude oil (it only produces 17% to 20% of what it needs), however is self sufficient in natural gas.

Of the companies that are being researched in the present study, Pakistan State Oil Company Limited (PSOCL) and Shell Pakistan are the main planks in the oil industry. Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company (SSGC), distributes major portion of the natural gas. Pakistan declared 1997-98 an “Oil and Gas Year”. As a result of offering incentives to potential investors, including foreign companies, some $2. 5 billion of investment was attracted. Oil and Gas Consumption Figures? Oil Consumption (In tones): 1999-00 2000-01 2001-02 2002-03 2003-04 17,768,000 17,648,000 16,950,000 6,542,000 13,421,000 Gas Consumption 2003 ( In mmcft): 1999-00 2000-01 2001-02 2002-03 2003-04 712,001 768,068 872,604 872,264 1,051,418 Consumption of oil and gas has been fairly steady throughout the 1990s with the gas consumption increasing at a rate of 4. 9 percent while the oil consumption increasing at a slightly reduced rate of 2. 5 percent. Until 1999, the government tightly controlled the oil and gas industries of Pakistan. No decision could be made without referring to the higher authorities, and when decisions were made, they were often based on political as opposed to economic considerations.

Since early 2000, an ambitious pro-market reform program is being implemented, and gradually, the straightjacket under which the industry used to operate is being dismantled. As a result, the sector has changed dramatically over the last five years, and Pakistan now leads South Asia in sector reform (Economic Survey of Pakistan, 2004-05). The government actions have focused on promoting private investments in the upstream, deregulating most of the market for petroleum products, establishing a regulatory agency for the gas sector, and introducing market-related price caps for petroleum products.

The government’s long term goal is to create a competitive, efficiently-run, financially smooth, and a largely privatized oil and gas sector providing supplies to a large share of population. It is important to note that a structural shift is taking place since 2000-01. The last five years have seen a positive trend towards greater gas consumption and a negative trend in the petroleum products consumption. Substantial progress has been made in the restructuring and reform of the oil and gas sectors, deregulation of prices, and privatization of selected assets.

The reform has enhanced transparency, making decision makers aware of the various aspects of the business. Rationale Oil and Gas is an important sector in Pakistan economy and it largely affects the GDP of Pakistan, therefore there is a great emphasis on exploration and marketing. The consumption of Oil was 16. 45 million tonnes in 2002-3 and consumption of gas was 872,264 million cubic feet. The acceleration in growth of energy consumption is not surprising when seen against a 15. 4 percent growth in large scale manufacturing and an 8. 5 percent growth in real GDP. Higher consumption of energy simply reflects the rising of economic activity in a country. Oil and natural gas are an integral part of the everyday life. Not only do they make the economy move, they heat and cool our homes and provide electricity. A large number of products are made from oil and gas, including plastics, life-saving medications, art silk, cosmetics, and many other items you may use daily. Even from Strategic point and defense view point Pakistan is dependent on oil and gas. Problem Statement

Oil and gas sector of Pakistan has changed dramatically over the last five years and Pakistan now leads South Asia in sector reform. The endeavors made to increase the oil and gas supplies need to be analyzed and companies encouraged. With this premise in mind four, Oil and Gas marketing companies have been selected to analyze their financial performance that would also indicate their success. Objectives of the study The objective of research study is to analyze the growth and development of the Oil and Gas Marketing Sector in Pakistan.

Currently according to the Board of Investment of Pakistan there are 26 (local and international) companies operating in upstream, 7 downstream companies, and 4 refineries. The focus of this analysis is on the progress of downstream companies that are based in Pakistan. Four leading downstream companies have been selected and their financial performance studied for a period of five years from 2001 to 2005 to see whether these companies are financially stronger and what their rate of growth is and to determine reasons behind the growth. Research Questions 1.

What is the importance of Oil and Gas sector in Pakistan economy? 2. What is the growth scenario of Oil and Gas Marketing companies in Pakistan? 3. What is the financial performance of the selected Oil and Gas marketing companies during the research period (2001-2005)? 4. What conclusions can be drawn about the industry based on the financial performance of the selected companies? Limitations Limitations: This research study has certain limitations that are not easy for the researcher to overcome at this level. The general level of inflation has not been adjusted for.

Overall prices of oil have increased due to unavoidable natural phenomenon like war in Iraq and Hurricane Katrina. The profitability of the oil marketing companies could be due to increase in prices of petroleum and it may not be the true measure of their financial performance. Some secondary data was not easily available and was very difficult to obtain. As the research work was given to the researcher during the semester so the time constraint played its role. Despite time constraint, the researcher has conducted a comprehensive research.

The limited experience in the research field is also a matter of consideration. This is the first study that goes to researcher’s credit. Hence, the researcher does not possess any experience in the field. CHAPTER 2 LITERATURE REVIEW The firm itself and outside providers of capital- creditors and investors –all undertake financial statement analysis. The type of analysis varies according to the specific interests of the party involved. Trade creditors (suppliers’ owed money for goods and services) are primarily interested in the liquidity of a firm.

Their claims are short term, and the ability to pay these claims quickly is best judged by an analysis of firm’s liquidity. The claims of bond bondholders, on the other hand are long-term. Accordingly, bondholders are more interested in the cash flow ability of the firm to service debt over a long period of time. They may evaluate this ability by analyzing the capital structure of the firm, the major sources and uses and uses of funds, the firm’s profitability over time, and projections of future profitability over time, and projections of future profitability.

The purpose of financial statement analysis is to examine past and current financial data so that a company’s performance and financial position can be evaluated and future risks and potential can be estimated. Financial statement analysis can yield valuable information about trends and relationships, the quality of a company’s earnings, and the strengths and weaknesses of its financial position (Woelfel, 1989). Investors in a company’s common stock are principally concerned with present and expected future earnings as well as with the stability of these earnings about a trend line.

As a result, investors usually focus on analyzing profitability. They would also be concerned with the firm’s financial condition insofar as it affects the ability of the firm to pay dividends and avoid bankruptcy. Internally, management also employs financial analysis for the purpose of internal control and to better provide what capital suppliers seek in financial condition and performance from the firm. From an internal control stand point, management needs to undertake financial analysis in order to plan and control effectively.

To plan for the future, the financial manager must assess the firm’s present financial position and evaluates opportunities in relation to this current position. With respect to internal control, the financial manager is particularly concerned with the return on investment provided by various assets of the company and in the efficiency of asset management. Finally, to bargain effectively for outside funds, the financial manager needs to be attuned to all aspects of financial analysis that outside suppliers of capital use in evaluating the firm (Horne & Wachowicz, 2001).

Financial analysis of a company should include an examination of the financial statements of the company, including notes to the financial statements, and the auditor’s report. The auditor’s report will state whether the financial statements have been audited in accordance with generally accepted auditing standards. The report also indicates whether the statements fairly present the company’s financial position, results of operations, and changes in financial position in accordance with generally accepted accounting principles. Notes to the financial statements are often more meaningful than the data found within the body of the statements.

The notes explain the accounting policies of the company and usually provide detailed explanations of how those policies were applied along with supporting details. Analysts often compare the financial statements of one company with other companies in the same industry and with the industry in which the company operates as well as with prior year statements of the company being analyzed (Foster, 1999). Comparative financial statements provide analysts with significant information about trends and relationships over two or more years. Comparative statements are more significant for evaluating a company than are single-year statements.

The analysis of financial data employs various techniques to emphasize the comparative and relative importance of the data presented and to evaluate the position of the firm. These techniques include ratio analysis, common size analysis, study of difference in components of financial statements among industries, review of descriptive material, and comparisons of result with other types of data. The information derived from these types of analyses should be blended to determine overall position. No one type of analysis supports overall findings or serves all types of users.

Financial statement analysis is a judgmental process. One of the primary objectives is identification of major changes (turning points) in trends, amounts and relationships and investigation of the reasons underlying those changes. Often, a turning point may signal an early warning of a significant shift in the future success or failure of the business. The judgment process can be improved by experience and by the use of analytical tools. The components of financial statements, specially the balance sheet and the income statements, will vary by type of industry (Gibson, 1998).

Economies — all economies — run on energy. Energy is needed to produce food and manufacture goods, power machines and appliances, transport raw materials and finished products, and provide heat and light. The more energy available to a society, the better its prospects for sustained growth; when energy supplies dwindle, economies grind to a halt and the affected populations suffer (Klare, 2005). Since World War II, economic growth around the world has been fueled largely by abundant supplies of hydrocarbons — that is, by petroleum and natural gas.

Since 1950, worldwide oil consumption has grown eightfold, from approximately 10 to 80 million barrels per day; gas consumption, which began from a smaller base, has grown even more dramatically. Oil and gas will account for 65% of world energy in 2025, a larger share than at present; and because no other source of energy is currently available to replace them, the future health of the global economy rests on our ability to produce and consume more and more of these hydrocarbons (U. S Department of Energy, 2004).

Petroleum refers to crude oil and natural gas or simply oil and gas, found in petroleum reservoirs generally thousands of feet below the surface. Exploratory wells are drilled to discover petroleum wells, while development wells are drilled to produce a portion of previously discovered oil and gas. Estimated volumes of recoverable gas within the reservoir are called oil and gas reserves (Brock, Jennings & Feiten, 1990). The oil and gas sector or the petroleum industry has the following four major segments: 1. Exploration and Production r E&P where oil and gas companies explore for underground reservoirs, and produce the discovered oil and gas using drilled wells. This thesis focuses on this sector of the oil and gas industry. 2. Hydrocarbon processing which includes oil refineries and gas processing plants. 3. Transport, Distribution and Storage by which petroleum is moved from the producing well areas to crude oil refineries and gas processing plants. Oil is moved by pipeline, truck, barge or tanker and Natural gas is moved by pipeline. 4. Retail/Marketing which ultimately markets in various ways the refined products.

CHAPTER 3 METHOD Sample For the sample selection of four marketing companies, out of the population of 7 companies listed in the KSE, the criteria used were: 1. Share Capital of the company 2. Sales Revenue 3. Distribution data of the companies Based on these criteria the four companies selected that are operating in Pakistan were the following: Pakistan State Oil Company Limited (PSOCL) Pakistan State Oil Company Limited (PSOCL) is the market leader in Pakistan having 73% of the share of Black Oil Market and around 59% of the share of White Oil market.

It is engaged in the import, storage, distribution and marketing of various petroleum products including Fuel oil, HSD, Jet Oil, petro-chemicals, LPG and CNG. Shell Pakistan Limited (SPL) The Shell brand name enjoys a 100-year history in this part of the world, dating back to 1899. Shell Pakistan has been taking a keen interest in expanding recently which shows the confidence in the economic growth and progress in the oil and gas sector. Shell is at present controlling approximately 30% share of the white oil products presently and during the last financial year the Capital Expenditure amounted to Rs 1. billion. Sui Northern Gas Pipelines Limited (SNGPL) Sui Northern Gas Pipelines Limited (SNGPL, is the largest integrated gas company serving more than 2 million consumers in North Central Pakistan through an extensive network in Punjab and NWFP. The Company has over 41 years of experience in operation and maintenance of high-pressure gas transmission and distribution systems. It has also expanded its activities to undertake the planning, designing and construction of pipelines, both for itself and other organizations.

SNGPL operates in that region of the nation which has a rapidly growing demand for natural gas and power generation due to significant industrial development. Sui Southern Gas Company (SSGC) Sui Southern Gas Company (SSGC) is Pakistan’s leading integrated gas Company. The company is engaged in the business of transmission and distribution of natural gas besides construction of high pressure transmission and low pressure distribution systems SSGCL transmission system extends from Sui in Balochistan to Karachi in Sindh comprising over 2780 KM of high pressure pipeline ranging from 12 – 24″ in diameter.

The distribution activities covering over 650 towns in the Sindh and Balochistan are organized through its regional offices. An average of about 234,553 million cubic feet (MMCFD) gas was sold in 2001-2002 to over 1. 7 million industrial, commercial and domestic consumers in these regions through a distribution network of over 22,890 Km. Type of Study This study aims to analyze the financial statements of oil and gas marketing companies and then generalize the result for the whole industry. Thus due to the purpose of the study it is classifies as descriptive study.

Procedure Base Year and Period of Analysis For the analysis, 2001 has been taken as the base year, and the performance in the next five years has been compared with the base year. Analysis Methods The analysis of financial data uses various methods to evaluate the relative importance of the data that was presented in financial statements of a firm. The methods used in the analysis of the marketing sector of Pakistan are a blend of Ratio analysis Common size analysis Ratio Analysis The following ratios were used on the composite data of five years: 1.

Liquidity Ratios related to the liquidity of short term assets and short term debt paying ability were Working Capital Current Ratio Sales to Working Capital 2. Profitability Ratios measure the ability of a firm to generate earnings. The ratios used were: Total Asset Turnover Operating Income Margin Return on Total Equity Return on Investment Gross Profit Margin Net Profit Margin 3. Debt Ratios that measure the long term debt paying ability of the firm used were: Debt Ratio Debt to Equity Ratio Fixed charge coverage 4. Market Value Ratios that measure the return that is being given to the stockholders were: Earning per share

Dividend per share Dividend Payout These financial ratios were calculated for each of the years from 2001 to 2005 and then plotted to see the general trend. They were then studied to identify various turning points in the trends, and to see the underlying reasons behind the changes in trends that were occurring. Common Size Analysis A common size analysis expresses comparisons in percentages. For the financial data there was -Horizontal and vertical analysis of the following balance sheet items, using 2001 as a base year (horizontal) and total assets as base (vertical): Fixed asset

Capital work in progress Long term investments Current assets Reserves & surplus Equity and liabilities were shown as a percentage of total liabilities. -Horizontal and vertical analysis of the following Profit and Loss items with 2001 as a base year (horizontal) and Net Sales as base (vertical): Financial Charges Operating expense Gross Profits Taxes Profit before Tax CHAPTER 4 RESULTS AND DISCUSSION Table 4. 1: Pakistan State Oil Company Limited Balance Sheets (2001-2005) Table 4. 2: Pakistan State Oil Company Limited Income Statements (2001-2005) 2001 2002 2003 2004 2005 Sales (Net) 43305. 67 133136. 52 172445. 77 161537. 98 212503. 65 Cost of Sales 136933. 58 126359. 13 163490. 58 152346. 86 198757. 32 Gross Profit 6372. 09 6777. 39 8955. 19 9191. 12 13746. 33 Operating Expenses 2367. 97 2210. 69 2750. 26 4223. 43 5443. 58 Operating Profit 4004. 12 4566. 7 6204. 93 4967. 69 8302. 75 Financial Charges 778. 7 979. 22 274. 78 189. 08 370. 7 Other income 225. 94 1549. 77 279. 17 1484. 36 1294. 34 Profit Before Taxation 3451. 36 5137. 25 6209. 32 6262. 97 9226. 39 Taxation 1200 1949 2179 2181 2183 Profit After Taxation 2251. 36 3188. 25 4030. 32 4081. 97 7043. 39 Table 4. : Pakistan State Oil Company Limited Vertical Common Size of Balance Sheets (2001-2005) 2001 2002 2003 2004 2005 Current Assets 81. 44% 74. 84% 69. 41% 74. 60% 78. 22% Fixed Assets (Gross) 21. 99% 24. 10% 29. 01% 25. 40% 21. 78% Depreciation 11. 02% 11. 90% 13. 96% 12. 51% 12. 08% Fixed Assets (Net) 10. 97% 12. 21% 15. 05% 12. 89% 9. 70% Capital work in Progress 2. 28% 2. 72% 3. 53% 2. 76% 2. 39% Long Term Investment & Deposits 5. 32% 10. 23% 12. 01% 9. 75% 9. 69% Total Assets 100. 00% 100. 00% 100. 00% 100. 00% 100. 00% Current Liabilities 63. 63% 62. 39% 55. 40% 59. 72% 62. 92% Deferred Taxation 0. 00% . 44% 1. 15% 1. 33% 1. 21% Long Term Liabilities 3. 82% 1. 85% 3. 05% 2. 53% 2. 63% Total Liabilities 67. 45% 65. 69% 59. 60% 63. 58% 66. 76% Paid-Up Capital 4. 74% 4. 36% 5. 30% 4. 04% 3. 29% Reserves & Surplus 27. 80% 29. 96% 35. 09% 32. 38% 29. 95% Total Liabilities & Capital 100. 00% 100. 00% 100. 00% 100. 00% 100. 00% Analysis: The vertical common size of the B/S of PSO shows that the current as well as fixed assets are pretty much the same and there is major improvement in long term investment & deposits while on the liability side again the current and long term liabilities are pretty much constant.

The reserves & surplus have been increasing with the passage of time. Table 4. 4: Pakistan State Oil Company Limited Vertical Common Size of Income statement (2001-2005) 2001 2002 2003 2004 2005 Sales (Net) 100. 00% 100. 00% 100. 00% 100. 00% 100. 00% Cost of Sales 95. 55% 94. 91% 94. 81% 94. 31% 93. 53% Gross Profit 4. 45% 5. 09% 5. 19% 5. 69% 6. 47% Operating Expenses 1. 65% 1. 66% 1. 59% 2. 61% 2. 56% Operating Profit 2. 79% 3. 43% 3. 60% 3. 08% 3. 91% Financial Charges 0. 54% 0. 74% 0. 16% 0. 12% 0. 17% Other income 0. 16% 1. 16% 0. 16% 0. 92% 0. 61%

Profit Before Taxation 2. 41% 3. 86% 3. 60% 3. 88% 4. 34% Taxation 0. 84% 1. 46% 1. 26% 1. 35% 1. 03% Profit After Taxation 1. 57% 2. 39% 2. 34% 2. 53% 3. 31% Analysis: The detailed analysis of the I/S of PSO shows that the oil marketing company has been able to slightly reduce its cost of sales which has resulted in a significant increase in the gross profit while the operating profit has also shown an increase as the operating expenses have increased but in a lesser proportion. The financial charges have been drastically cut down due to a better financial performance.

There has been a marked improvement in the other income which shows that the company has increased its sources of income and all this has resulted in higher profits. Table 4. 5: Pakistan State Oil Company Limited Horizontal Common Size of Balance Sheets (2001-2005) 2001 2002 2003 2004 2005 Current Assets 100% -0. 001% -8. 54% 28. 90% 65. 98% Fixed Assets (Gross) 100% 19. 269% 41. 53% 62. 56% 71. 13% Depreciation 100% 17. 468% 35. 91% 59. 74% 89. 36% Fixed Assets (Net) 100% 21. 078% 47. 18% 65. 40% 52. 81% Capital work in Progress 100% 30. 150% 66. 47% 70. 52% 81. 58% Long Term Investment & Deposits 100% 109. 346% 142. 40% 158. 6% 214. 84% Total Assets 100% 8. 811% 7. 30% 40. 72% 72. 81% Current Liabilities 100% 6. 701% -6. 57% 32. 08% 70. 88% Deferred Taxation 100% 47200% 37250% 56425% 63018% Long Term Liabilities 100% -47. 371% -14. 53% -7. 05% 18. 70% Total Liabilities 100% 5. 958% -5. 19% 32. 63% 71. 02% Financed By Paid-Up Capital 100% 0. 000% 20. 00% 20. 00% 20. 00% Reserves & Surplus 100% 17. 237% 35. 44% 63. 87% 86. 15% Total Liabilities & Capital 100% 8. 811% 7. 30% 40. 72% 72. 81% Analysis: The horizontal common size of the B/S of PSO significantly tells that the current assets have increased substantially mainly due to the increase in sales.

Another important aspect to note is the great deal of increase in the long term investments which is due to various new projects that have been undertaken and this shows that the company is expanding. The increase in current liabilities is mainly due to the increase in credit sales and also because a significant portion of long term loans has been converted into current portion while the increase in long term liabilities is mainly due to the increase in employee benefits which again shows that the company has been doing very well. Another good indicator of the good performance is the increase in the reserves & surplus section of the B/S.

Table 4. 6: Pakistan State Oil Company Limited Horizontal Common Size of Income statement (2001-2005) 2001 2002 2003 2004 2005 Sales (Net) 100% -7. 096% 20. 33% 12. 72% 48. 29% Cost of Sales 100% -7. 722% 19. 39% 11. 26% 45. 15% Gross Profit 100% 6. 361% 40. 54% 44. 24% 115. 73% Operating Expenses 100% -6. 642% 16. 14% 78. 36% 129. 88% Operating Profit 100% 14. 050% 54. 96% 24. 06% 107. 36% Financial Charges 100% 25. 751% -64. 71% -75. 72% -52. 40% Other income 100% 585. 921% 23. 56% 556. 97% 472. 87% Profit Before Taxation 100% 48. 847% 79. 91% 81. 46% 167. 33% Taxation 100% 62. 417% 81. 58% 81. 75% 81. 92%

Profit After Taxation 100% 41. 614% 79. 02% 81. 31% 212. 85% Analysis: The horizontal common size of the I/S clearly indicates the drastic improvement in the sales which is almost around 50% while due to a lesser increase in the cost of sales the gross profit is up by over 115%. The financial charges have been reduced to more than 50% and a huge increase in other sources of income has led to higher profit before taxation. Table 4. 7: Shell Pakistan Limited Balance Sheets (2001-2005) 2001 2002 2003 2004 2005 Current Assets 6470. 64 7145. 22 6149. 68 7912. 63 12725. 13 Fixed Assets (Gross) 6027. 49 6705. 37 7554. 29 8708. 5 9569. 78 Accumulated Depreciation 2189. 29 2738. 78 3290. 57 3852. 84 4532. 53 Fixed Assets (Net) 3838. 20 3966. 59 4263. 72 4855. 21 5037. 25 Capital Work in Progress 464. 52 534. 61 564. 44 544. 07 582. 38 Long Term Investment & Deposits 1294. 68 186. 27 1998. 93 2032. 22 1988. 13 Total Assets 12068. 04 11832. 69 12976. 77 15344. 13 20332. 89 Liabilities Current Liabilities 6470. 65 5934. 76 7029. 83 9042. 39 11951. 06 Long Term Liabilities 66. 84 47. 51 77. 86 43. 49 48. 22 Deferred Taxation 141 29. 24 17. 26 126. 42 20. 74 Financed By Paid-Up Capital 350. 66 350. 66 350. 66 350. 66 350. 66 Reserves & Surplus 038. 89 5470. 52 5501. 16 5781. 87 7962. 21 Total Liabilities & Equity 12068. 04 11832. 69 12976. 77 15344. 13 20332. 89 Table 4. 8: Shell Pakistan Limited Income Statements (2001-2005) 2001 2002 2003 2004 2005 Sales (Net) 65725. 15 69042. 05 77822. 82 79180. 35 98526. 62 Cost of Sales 61628. 48 64164. 23 72049. 47 72973. 11 89684. 58 Gross Profit 4096. 67 4877. 82 5773. 35 6207. 24 8842. 04 Operating Expenses 2486. 67 3292. 92 3794. 36 3806. 01 4609. 77 Operating Profit 1610. 00 1584. 90 1978. 99 2401. 23 4232. 27 Financial Charges 50. 27 46. 76 51. 48 224. 33 596. 55 Other Income 191. 72 154. 46 110. 32 12. 02 22. 33

Profit Before Taxation 1630. 45 1572. 44 1899. 91 2188. 92 3658. 05 Taxation 574. 42 509. 62 644. 91 680. 91 1197. 19 Profit After Taxation 1056. 03 1062. 81 1255. 00 1508. 01 2460. 86 Table 4. 9: Shell Pakistan Limited Vertical Common Size of Balance Sheets (2001-2005) 2001 2002 2003 2004 2005 Current Assets 53. 62% 60. 39% 47. 39% 51. 57% 62. 58% Fixed Assets (Gross) 49. 95% 56. 67% 58. 21% 56. 75% 47. 07% Accumulated Depreciation 18. 14% 23. 15% 25. 36% 25. 11% 22. 29% Fixed Assets (Net) 31. 80% 33. 52% 32. 86% 31. 64% 24. 77% Capital Work in Progress 3. 85% 4. 52% 4. 35% 3. 55% 2. 86% Long Term Investment & Deposits 0. 73% 1. 57% 15. 40% 13. 24% 9. 78% Total Assets 100. 00% 100. 00% 100. 00% 100. 00% 100. 00% Current Liabilities 53. 62% 50. 16% 54. 17% 58. 93% 58. 78% Long Term Liabilities 0. 55% 0. 40% 0. 60% 0. 28% 0. 24% Deferred Taxation 1. 17% 0. 25% 0. 13% 0. 82% 0. 10% Financed By Paid-Up Capital 2. 91% 2. 96% 2. 70% 2. 29% 1. 72% Reserves & Surplus 41. 75% 46. 23% 42. 39% 37. 68% 39. 16% Total Liabilities & Equity 100. 00% 100. 00% 100. 00% 100. 00% 100. 00% Analysis: Vertical common size of the B/S of Shell Pakistan shows that the company has been pretty much maintaining its proportion of all the assets, liabilities

2016 has been an interesting year for eCommerce in India, with an increasing number of shoppers using connected devices to purchase products online. At 277 Million users, India surpassed the US to become the 2^nd most connected country in the world. Some skeptics might also consider it a bumpy ride, with an almost overnight fall from grace for the once poster boys of the burgeoning high tech industry. However, if we were to take a bird’s eye view of the industry trends, I would say that it is an exciting time nonetheless – with international leaders like Amazon and Alibaba making their presence felt in the country, as well as the entry of an increasing number of traditional brick and mortar retailer businesses entering the ecommerce arena. Traditional businesses like Tata, Aditya Birla Retail and Reliance – all of whom have started to realize the importance of reaching out to a connected audience.

I for one, believe that if you’re an entrepreneur who has been involved with the launch of an ecommerce business in the past, or are looking to get involved with your first venture, now would be the time to get your foot in the door. And with the numbers showing the growth of the sector doubling by the end of this year to cross Rs. 2 lakh Crore, it is time to take things seriously.

While these numbers suggest a significant growth in the coming months and years, it is important to note that in order to see any kind of positive results, you need to follow the right approach. So whether you have a small store that you operate via your Instagram account or a major ecommerce site, the fact remains that traffic drives sales! Shoppers today are spoilt for choice, and it’s important to ensure that they not only choose your store over the competition, but also choose to remain your loyal customers. Now if you’re wondering whether you’re doing enough to drive traffic to your store as possible, I suggest you read on. I’ve put together a few ways in which you can not only see more hits on your site, but can also maximize your entire conversion funnel.

1. One Google to rule them all. Focus on improving your search engine rankings

There is no denying the power of search engine optimization. Traditionally, SEO was all about words like metadata, keyword density and basic structure. Search engines were much easier to manipulate, and to fool in that era. This made it extremely easy for startups, and smaller players to compete with the bigwigs in the business. However, the evolution search engines, more importantly, Google – has brought about a new emphasis on unique, quality content and inbound links. The key is to ensure that your website has the right words in the right places, and that there are a lot of other websites link to it. This has given birth to the ‘Content is King’ movement, the goal is to ultimately generate great content which gains good traction, and widespread distribution on the Internet.

Most outsiders believe content marketing is easy: write a blog-post with eye-catching images, or just create a meme. But let me tell you that you that in order to see any kind of positive results, you need highly targeted and quality content. And that requires a lot more effort than a blog-post or a meme!

One of the secrets to effective content marketing is convincing them to evangelize your business. Seek out your customers, make them the hero, and get their stories. Highlight what your brand means to them, and why they chose you over others.

2. More power to your shoppers. Understand their needs and intent to offer a truly personalized shopping experience

It’s no secret that one of the biggest shortcomings of purchasing products online is the fact that a computer simply cannot give you the personal attention that a store attendant can. But what if I told you that with modern technologies like Machine Learning and predictive analytics, it has become easier to understand your shoppers, as well as your store’s target segments better?  These technologies can help you make product discovery on your site much simpler, and faster. One of the first steps is to improve site search, which is often the first touch-point for any shopper on your site, especially when the intent to purchase is high.  The autosuggest feature in search is often an overlooked, but an extremely powerful merchandising tool which can be leveraged to provide highly relevant suggestions based on the shoppers’ browsing history, demographics, intent, or simply their stage in the buying cycle. An improved customer experience on your site, will result in increased repeat visits, and higher conversions too.

3. Aim for a higher share of the shopper’s wallet. Promote up sell and cross sell

Picture this scenario. You enter a store looking to buy a TV. You pick a model that fits your requirements and budget. However, the salesman tries to convince you to loosen your wallet to just a little bit more to buy a bigger screen, and maybe even buy a new home theatre system just to go with the new setup. Does that sound familiar?Online selling is no different, but instead of a sweet-talking salesman, you need to rely on tools to promote relevant, personalized recommendations when the intent to purchase is clear. Personalized recommendations have been known to increase the Average Order Value by over 40%. Ever so often, your shoppers won’t be aware of a better product that is available in your catalogue, or they may be convinced that a different product may be a better fit for their needs. This is where personalized recommendations can make all the difference.

However, there are two important considerations when upselling:

• The upsells HAVE to be related to the original product being viewed
• Respect the price range specified by your shoppers. Once your shoppers have an anchor price in mind, they will probably stick to the original product that meets their basic requirements. In order to get them to spend more, the new product needs to be much better than the original product.

4. Mobile readiness is not just a buzzword. The numbers tell you why you should care

mCommerce and mobile’s influence in retail is increasing exponentially. Whether it is to make a purchase, or research products, there’s no denying the fact that mobile is a channel that your shoppers care about, making it one that you cannot choose to ignore anymore. However, the numbers also suggest that while mobile accounts for more than half of all ecommerce traffic globally (with an even higher percentage in India), the conversions are less than 25% compared to desktop. You’re probably wondering why you still need to care. And the answer is simple, your mobile site or app is often the first channel that your shoppers choose to interact with you on. And while a mobile device might not be used to make the final purchase, its influence on all your other channels is immense – whether it’s a desktop, or a physical store.

It’s also important to note that merchandising on mobile is vastly different. So re-design your mobile shopping experience by thinking mobile-first  – and create more than just mobile responsiveness or a mobile site.

When it comes to driving traffic and driving conversions, there are no hard and fast rules to be followed. More often than not, it’s how you combine some of the guidelines mentioned above, along with your instinct. And while driving traffic is extremely challenging during the initial stage of operations, it is the next stage where most entrepreneurs falter – where the focus needs to be on building value and loyalty. Your happy shoppers are your greatest asset, with the power to influence others, and minimize your customer acquisition costs. Continuously measure and analyze your performance to optimize, and to build a scalable and sustainable business.

What is catering industry? The catering industry is comprised of businesses that provide food, beverages and other services to a variety of clients, usually for special events. Catering industry Jobs vary from small intimate affairs to large events that involve providing not only food and beverage service but also tableware, linens, service personnel and other aspects of the event. Companies that provide catering services might be as large as a business with several locations or as small as an individual who provides catering services on his or her own.

A caterer might be part of a restaurant or have his or her own business. Caterers might make use of independent contractors for some aspects of their catering service. Small dinners and banquets are some types of events for which a caterer might provide service. These events might be set in a person’s home, a small restaurant or an outdoor venue. Some individuals might have a personal caterer who provides private catering services whenever needed.

There is a niche for all types of catering businesses within the segment of catering. The food service industry is divided into two general types: commercial segment and non- commercial segment. Catering management may be defined as the task of planning, organizing, controlling and executing. Each activity influences the preparation and delivery of food, beverage, and related services at a competitive, yet profitable price. These activities work together to meet and exceed the customer’s perception of value for his money.

Primary or commercial catering

These are the establishments whose main aim is to earn profit by providing food and beverage to the guests as per their demand. Hence, they are also referred as commercial catering, establishments. Such as hotels , restaurants, fast food outlets, ears, pubs, etc.

1. Residential- These type of establishment provides food n beverage along with accommodation. Such as hotels , motels, resorts, ship or cruise lines, etc.
2. Non-Residential- These types of establishment provides only food & beverage. Such as restaurants, pubs, night clubs etc.

Secondary or non-commercial catering

These are the establishments that provide food and beverage as a part of another business. Their aim is not to earn money. Instead, the establishments are there to provide welfare services at affordable prices, such as industrial canteens, hospital catering industry By shorthanded quality and the quantity of the food should be equally good, through this type of menu offered in this type of catering might be different from another.

May be deemed as those operations in which making a profit from catering facility is not the outlet’s main concern. Since the operations are completely or partially subsidized by a parent body, such establishments’ primary obligation is in the well being or care of their guests/ customers/ patients. Unlike commercial catering establishment the guests/ customers/ patients do not have choice of catering facilities.

Institutional catering

Institutional catering includes school, colleges, universities, hospitals, orphanages, old age homes, prisons etc.

In some of these establishments no charge is made to certain group of customers to for the provision of food & beverage services as they are completely or partially subsidized by various government funds. 2) Transport The provision of food and beverages to passengers, before, during and after a journey on trains, aircraft and ships and in buses or private vehicles is termed as transport catering. These services may also be utilized by the general public, who are in the vicinity of a transport catering unit.

The major forms of modern day transport catering are airline-catering, railways catering, ship catering and surface catering in coaches or buses which operate on long distance routes.

Surface catering

Catering to passengers traveling by surface transport such as buses and private vehicles is called surface catering. These eating establishments are normally located around a bus terminus or on highways. They may be either government run restaurants, or privately owned establishments. Of late there has been a growing popularity of Punjabi style eateries called Dhabi on the highways.

Industrial catering

The provision of food and beverages to ‘people at work,’ in industries and factories at highly subsidized rates is called industrial catering. It is based on the assumption that better fed employees at confessional rates are happy and more productive. Catering for a large workforce may be undertaken by the management itself, or may be contracted out to professional caterers. Depending on the choice of the menu suggested by the management, catering contractors undertake to feed the workforce for a fixed period of time at a predetermined price.

INTRODUCTION: Ethics occupy an important place in today’s modern business world. Every organization makes use of ethics to make day-today decisions and fulfill societal expectations. This essay brings to light ethical and social responsibility that every individual and company should follow in order to become better citizens for society. Essay presents analysis based on real case of Philip Morris, a tobacco company in U. S. A versus Mayola – a widow, who took legal action against company for her husband’s death due to smoking.

Essay draws balanced argument based on evidences about unethical behavior of tobacco company and smokers personal responsibilities for their actions. We have used Ethical decision-making model of Lagenderfer and Rockness to frame our analysis. ETHICS & BUSINESS Ethics in simple terms means set of moral principles or list of rules, which can determine whether particular action undertaken is ‘right’ or ‘wrong’. All the activities undertaken by society are based on ethics. Ethics can be personal as well as professional.

are based on individual’s values, beliefs, attitudes and actions while business ethics are based on certain principles or code of conduct to guide individual or a group in accordance with societal expectations. Business ethics can be defined as “study of business situations, activities and decisions where issues of right or wrong are addressed”(Crane, A& Matten ,D, 2007,P. 5). Thus, ethics helps in making decision and is a key for solving problems. Today, society is facing considerable increase in number of ethical issues such as fraud, exploitation, misleading advertisement and increasing pollution. Birt, Chalmers, Beal, Brooks, Byrne, Oliver, 2008, P. 65). CORPORATE SOCIAL RESPONSIBILITY It is essential for every organization to undertake corporate social responsibility along with its goals and objectives. According to (Birt et al. , 2008, p. 70) Corporate social responsibility can be referred to responsibility that an entity has to all its stakeholders, including society in general and physical environment in which it operates. There are many companies, which lack sense of corporate social responsibility and acts against interest of society.

RELEVANT FACTS DETERMINED UNDER CASE: Today, business is giving rise to numerous ethical issues, as many companies are involved in exploiting its customers, selling harmful products in markets, false marketing of products and increasing environmental and health issues. Many tobacco companies like Phillip Morris are selling harmful and addictive products like cigarettes that cause serious diseases like lung cancer and heart attack. Analysis of Phillip Morris v. Mayola, Williams case brings down certain relevant facts that give rise to ethical issues.

Mayola took a legal action on Philip Morris on the grounds of false and misleading advertisement and marketing undertaken by company for its products. It is fact that Philip Morris knew that tobacco was harmful for health still he advertised his product as non-addictive and safe and Williams death was caused by smoking. Second, fact is that Philip Morris appealed solely against damages that company had to pay to other smokers who did not bring any actions against court. Their appeal was only based on excessive damages that company was supposed to pay to strangers.

This clearly indicates that he is very well aware of harms caused by his cigarettes to smokers and did not appeal on the grounds that his products were safe and less addictive. It is also relevant fact that Supreme Court made decision in favor of Philip Morris that company is not liable to pay excessive damages to Ms Williams on the grounds that damages were proper under Oregon statute but was excessive under federal constitution (BBC article, 20 Feb, 2007). This indicates that ethical laws are still complex and not clearly stated under constitution.

ETHICAL DILEMMAS FOR BOTH SMOKERS AND COMPANY: Ethical dilemma arises when there is a situation with conflict of interest. We have built certain arguments based on ethical dilemmas from perspective of both smoker and company. We have constructed evidence-based arguments on unethical behavior by Philip Morris Company, which includes major ethical issues, such are selling harmful products, misleading and false advertisement, acting against societal expectations and caring out unethical business practice.

Company is involved in producing and selling harmful tobacco products that contains high amount of nicotine, are addictive, and can cause serious health issues such as lung cancer and heart attack. Company acts unethically by encouraging people to smoke and their conflict of interest with societal ethical standards and expectations. According to (Janine and Ruth, 2008) company prevents old smokers from quitting and targets young people and children. Company adopts new and innovative marketing approaches to promote its products like direct mail advertising and sending coupons with discounts. Low tar” cigarettes were developed in response to the health concerns of older smokers in 1970, but experts found them no advantageous to health and did not help smokers to quit. Company lacks in corporate social responsibility as they perform activities that are against interest of society in general and physical environment in which it operates. Company undertakes massive fraud by acting dishonestly having financial motive in mind. Company is involved in false advertisement indicating their products to be less addictive, more filtered and safe.

According to ( Rosner, 2006, P. 193-196) company tries to create illusion by sponsoring cigarette cessation programmes and try to make society believe that they act in ethical way, but their real motive behind it is to promote company’s goal of selling cigarettes and meet their financial interests . Their misleading marketing activities makes lots of people to go for smoking. Philip Morris promised to shut down instantly if their cigarettes were found to be harmful but has failed to keep its promise, which gives rise to ethical dilemma. According to (David & Silva, 2004, p. 9-22) Company uses their political and economic influence to create an environment that encourages continued consumption of cigarettes. Company is accused of political lobbying. They lobby legislators and officials in finance ministry in order to keep tobacco prices low and thus encouraging people to smoke. Philip Morris was after minimizing total tax burden on cigarettes in order to keep smoking affordable. Article in Ethical Corporation magazine (2004) states that company declares itself responsible and argues that there is increasing demand for cigarettes by customers and if they stop selling it, someone else will take their position.

Company tried to safeguard themselves on the grounds that they are selling legal products, which are not banned by government and are acting in ethical way by warning its customers against dangers associated with smoking. Thus, company gives rise to ethical dilemmas as it has an intension to make huge profits by selling harmful products that are responsible for death of millions of people and still trying to gain creditability as responsible company.

From perspective of smokers in general, they give rise to ethical issues by consuming harmful products that are not ethically accepted by society and do not take warnings given by companies and government seriously. It is unethical to blame companies solely responsible for damages caused to them and bring their own actions against company. Their behavior can give rise to ethical dilemmas as their actions have a deep impact on their children and makes smoking more desirable for their kids in future. They also lack in personal and social responsibility by giving rise to health issues and environmental concerns for society in general.

CONCLUSION: Thus, we conclude that tobacco is one the world’s greatest preventable health problems. According to our analysis, we came to a balanced conclusion that smokers should take responsibility for their actions and companies should behave ethically by making its customers fully aware about the dangers of smoking. It is very essential to undertake combined ethical and social responsibility by both smokers and tobacco companies to avoid millions of deaths due to smoking and to act in favor of societal expectations.

Tobacco companies should stop giving misleading advertisement and marketing activities, which indicates their products to be safe and less addictive. They should stop encouraging consumption of tobacco among young and old and should ban children from its consumption. It is the responsibility of companies to support smoking cessation programs and help smokers to quit not just for sake of creating illusion but also to act in favor of societies interest in general and to build better image in society.

Company should change their unethical business practices of creating massive fraud to fulfill its financial motive and provide support to government activities that help smokers to quit. Smokers should follow their personal ethics and should take responsibility for smoking. They should take warnings given by tobacco companies and government to quit smoking seriously. They can search on internet for more information or consult doctor to improve heir knowledge about serious health issues caused by smoking. Smokers should not escape from their personal and social responsibilities towards society and their families.

It is unethical to bring their own action against company and solely blame company for health issues caused by smoking. It is moral duty and responsibility of every citizen to bear risk associated with their actions. It is responsibility of government to take care of its citizens and find solutions for their health relating issues. We believe that Political parties should not accept any funds from Tobacco Company for their campaign and government should ban any kind of commercial ads for cigarettes in magazine, newspapers or on television.

Government should support smoking cessation programs and quitting and should be alert if tobacco company provides any support as they may mislead government by doing indirect advertising for their products. We recommend that there should be strict tobacco control strategy that restricts consumption of all tobacco products. Thus we conclude that it is ethical, moral and social responsibility for smokers, tobacco companies and government to stop consumption and selling of harmful products for betterment of society and environmental concerns. REFERANCE )Birt, J. ,Chalmers, K. ,Beal, D. , Brooks, A. , Byrne, S. , & Oliver, J. (2008). Accounting: Business Reporting for Decision Making. (2nd ed). John Wiley & Sons: Milton, Old. 2)Crane, A. , Matten, D. (2007). Business Ethics: Managing Corporate Citizenship & Sustainability in Age of Globalization. (2ND ed). Oxford University Press: New York. 3)David, A. , Silva,V. ( 2004). Building Blocks for Tobacco Control: a handbook tools for advancing tobacco control in xxist century. Publisher World Health Organization: Geneva 4)Rosner, F. (2006).

Contemporary Biomedical Ethical Issues and Jewish Laws. KTAV Publishing House: New Jersey 5)Janine, C. , & Ruth, M. (2008). False Promises: Journal of American Geriatrics, 56(9), p1716-1723, 8p, 1 chart retrieved on 5/ 09/2009 from Academic Search Premier Database. 6)Tobacco firm wins payout appeal: BBC news article https://news. bbc. co. uk/2/hi/business/6379767. stm retrieved on 6/9/2009. 7)Philip Morris executive declares his company ‘Responsible’: Article from Ethical Corporation Magazine: http://www. ethicalcorp. com/content. asp? ContentID=2345 retrieved on 8/09/2009.

Penthouse Heinlein seeks to expose not Just its own brand, but the local brands swell, it may be a daunting task because there is a lack of much innovation, especially that it is family controlled with no allowance for outside and new governance. But the brand itself is strong, so it will maintain and/or grow its position. Grossly It is a medium-sized company that has set a niche with products that are new and innovative, and their packaging is striking and different, but they may find it difficult to maintain this position in the market because of the trial and error expense they have created for themselves. N.B. Has the benefit of being the biggest brewer in most countries and continents, so it can afford to test new markets. But with the competitive environment it dwells in, the expense may go well beyond what they can manage, if they fail to market and run their product, brand cooperation. It will be difficult to achieve that because of its size. Scottish & Newcastle Has invested most of its power in an eventual dying market, Europe. The decreasing beer consumption will negate its resources unless it expands it reach overseas to expose its brands.

Luckily it is successful and with the European focus it has well attained, it has stability in its position in the market. There also need for them to diversify, instead of having beer on the market. QUESTION 2 (it) Strengths Strong overseas strategy to use locally acquired companies to introduce Heinlein to new markets. The transfer of expertise and technology to local, companies which help economies of scale for both Heinlein and local beers. It is family controlled to help stability and independence for international growth.

Weaknesses Its biggest brands are Heinlein and Master. For a big company, it does not diversify very much. It needs to create more brands to help maximize profits in different areas. It is family controlled, which means there is no allowance for ‘new blood’ and innovation. Grossly The company is innovative and it has a strong brand, which people rely on, e. G. Its flavored beers and striking green bottles. It has new drinks on the markets and works on new ideas plus, has a trial brewery for testing the market. It Exports many of its drinks which allow more customers.

Weaknesses innovation for drinks and cost of production. The new brewery will potentially cost it with failures and trial drinks. Ellen Is a very big company and the merger allowed new ideas and more brands on the market. Wants to transform itself from biggest to best brewer, which means it values consistency and growth. Wants to coordinate all functions internationally. Weaknesses Too many acquisitions mean the cost maintenance is high. The ability to work as one unit for a big company is a difficult task to accomplish.

Consistency and synergy may be difficult across continents and countries. Scottish & Newcastle Focusing on Europe as a strategy helps them analyses effectively how to strategies and, helps unite all acquisitions and run them as one unit. The investments in Baltic Beverages helped them expose their brand to many countries. Closing down inefficient breweries cut down unnecessary costs. Weaknesses Simply focusing on one continent will not expose the products to new markets. Heavily investing in one sector, like the Baltic beverages, has potential consequence for failure cost.

The retail industry currently has some of the most intense rivalry in the world.  With major advances in production, technology, and distribution, the participants in the retail industry must use their resources to develop new resources and strategies faster than their competitors (Warren, 1999).  Three major forms of rivalry exist within the retail industry.  These forms are capturing the rivals of competitors, attracting and developing potential customers, and competing for sales to customers shared between two or more competitors.  Capturing the rivals of competitors entails providing a product or service that is better than a competitor’s or providing similar products and services at a more affordable price.

Attracting and developing potential customers entails promoting products and services in a way that attracts customers and encourages them to develop strong loyalty to the company in question.  Competing for sales to customers shared between two or more organizations entails promoting products and services, offering competitive pricing, or offering value-added products and services in order to encourage customers to shop exclusively at one retailer rather than several competitors (Warren, 1999).

There are currently many participants in the retail industry competition.  Three of the biggest competitors are Wal-Mart, K-Mart, and Target.  Wal-Mart is known for offering “everyday low prices” for merchandise in apparel, toys, sporting goods, stationery, fabric and crafts, electronics, home furnishings, and other general merchandise departments.  In addition, Wal-Mart has Superstores that offer grocery items, optometry services, salon services, and manicure services depending on the location.  K-Mart is another big box retailer that offers merchandise in general merchandise categories. K-Mart offers a limited amount of grocery items, mostly soft drinks, snack foods, and convenience items.  K-Mart has little in the way of add-on services, but does offer a pharmacy in many locations.  Target is touted as a more upscale retailer than Wal-Mart or K-Mart.  It offers general merchandise and more high-end apparel than either of its major competitors. Read about NEXT PLC Competitors

Wal-Mart’s major competitive strategy is pricing.  It advertises “everyday low prices,” showing current and potential customers that their prices are consistently low, and not low only during a special sale or promotion.  Wal-Mart is continually adding new products to its line of general merchandise and its Superstores offer convenience for busy customers.  In addition, Wal-Mart’s return policy is more lenient than K-Mart or Target.  While returns do create costs for retail organizations, a good return policy can also generate customer good will and repeat shoppers.

K-Mart has had to rethink its competitive strategy following its financial difficulties and eventual Chapter 11 bankruptcy.  K-Mart recently acquired Sears department stores and offers several exclusive product lines including Martha Stewart, Joe Boxer, and Jacqueline Smith.  These exclusive relationships attract customers who are searching for the stylish Martha Stewart product line or the youthful and exciting styles in the Joe Boxer line.  K-Mart’s return policy is very strict and is not a good way to compete with Wal-Mart and Target.

Target’s competitive strategy includes promoting itself as a high-end retailer.  Target offers apparel by designers such as Mossimo and Isaac Mizrahi.  These apparel items are well designed and generate a sense of class for customers but are still offered at sensible prices.  In addition, Target remains competitive by referring to its customers as “guests” and has telephones located throughout the store for immediate customer assistance.  This dedication to helping customers navigate through the store and select products allows Target to generate goodwill from customers.

Non- Restricted- the firearm must be unloaded. Restricted- the person transporting the firearm must have an authorization to transport the firearm; it must be unloaded and locked with a locking device and store in an opaque gun case that is not easily broken. Prohibited- the requirements are the same has the restricted but if the arm is an Automatic Firearm the bolt (an attachment) or the bolt carrier must be transported separately. Who are the winners and loser from the regulation? Firearm control law has been in Canada since 1892.

At that point in time an individual could be Jailed for up to six month for possession of a hand gun (not license firearm) if found carrying the arm without reasonable cause to fear assault to life or property. Has years goes by laws and regulation pertaining to the possession of a firearm has changed, laws became more specific, stricter and are more enforced by the RACK. With this being done it is harder for entrepreneurs (small business owners), individual (Gun Enthusiasts) and manufactures to have open access to fire arms. These groups can both be loser and winner of the regulations.

Before any of the groups listed above is able to possess firearm harm there are step that they must go through. Individual: For and individual to become a license firearm holder there are steps that must be taken, which can be lengthy and confusing. All these steps can be tedious and expensive and cause an individual to think twice and hard before going through all these processes. Entrepreneurs and manufactures: the steps taken by an individual to license and register all firearms is also required to obtain a Firearm Business License.

These sciences vary depending on the size of the business (fees listed above) before a restricted or a prohibited firearm is sold or transferred to another party the arm how the gun industry is regulated By sexy selling the firearm) must be an adult (18) with a firearm business license. The government collects more taxes and those taxes are pumped back into to the economic where the society benefits. So in the end all three groups can be winners and loser depending on what angle you view the situation from, while the government and society are Just winners.