Small Business Management

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The shops purchase items in bulk from direct dealers. They have a storage space in most of the shops for stock keeping. The inventory method is usually Just in Time followed. They usually have 2 sales men in normal size electronic shop and 2 loaders for special delivery items like fridge or TV. Few of the shops have their contract with drivers of the logistic workers example of shezore or mini trucks to deliver the goods at home of the customers. They then give a commission to shops owners for bringing each customer.

The monthly cost of running a shop (Utility bill) is usually Rs 2000 to 4000 and in case of display shops like TV or Fridge, it’s up to Rs8000. The daily expenses include 2 times food for workers and tea expenses which hardly come around Rs80-100 per worker. Out of the salary, a commission is also given to salesmen on Premium sale.

The relationship with their supplier and customer is very important. As the structure is informal a credit lineage is given to suppliers and regular customers. The suppliers give them credit period (Udhaar) of about 20 days for electronic items and a week for mobile products. The credit period can be extended depending upon their relations with the suppliers. When asked about the monthly profits, all the shopkeepers refused to tell but it seems that they were pretty much satisfied with their earnings.

Marketing Techniques

Marketing is usually done by the owner of the business and marketing techniques and procedures are informal. However there are also other big businesses that exist in the electronic market, which apply formal marketing techniques.

Mainly the marketing personnel here are the owner, who decides the marketing process on his own. This marketing for the shop is done according to his experience and judgment ability. The customers mostly come to the owner by reference from previously satisfied customers or may be through the attractive marketing purpose sign board or display items that block the pedestrian sidewalks. Saddar electronic market is mainly the center of electronic equipment’s where everything from cellphones, computers, irons, refrigerators, air conditioners, heaters, satellite dishes, DVDS, stereo systems, TV and much more is available. Since there are a cluster of various electronic items all available in the same area a lot of people across Pakistan and from within Karachi travel to Saddar to make electronic related purchases. This kills the purpose of identifying and segmentation. No shopkeeper uses the identification marketing technique as the customers are all those seeking electronic items. One of the best marketing techniques available for these shops is word of mouth. The next important and most continently and easily used marketing technique used is displays. Mostly shop keepers in the electronic market all consider that the sidewalk that the government initially built for the pedestrians is actually a bonus to shop and they think that this area has been allocated to them as a gift of appreciation from the government. So they successfully take up the sidewalk and place bulky electronic equipment on the sidewalks to market the product and get attention from passing by potential customers as driving through the area is literally impossible. Many shops also use techniques like free delivery and provide such incentives to promote their business and market their shops. Some mobile shops use printed polythene bags to advertise their shops.

The other 10% of the market contains businesses that are relatively of a bigger size. Customers in this sector of the market are formally identified by both the manager and the owner. These businesses uses interactive methods such as personal selling and both top-down and bottom–up approach of marketing. They use small exhibitions and trade shows to along with retail selling to market their product.

Grievances

The major grievances are that the small businesses in the sadder electronic market were against the continuous harassment by the police and the continuous collect of Bhata by them. Since many of the shopkeepers in the electronic market area place bulky electronic items on display on sidewalks which is illegal the police allows them to keep those on the sidewalks then as part of rent the police officers the usually demand expensive electronic items in return such as TVs or Refrigerators. The shopkeepers are also concerned about the security issue of the area. Although not much violence has gripped the sadder area but traders are demanding that more security should be provided.

From the provincial government and the city government the traders and small business owners are demanding better infrastructure facility such as a constant and smooth traffic flow and continuous electricity supply. The traders in the market are demanding sufficient parking space for both owners as well as customers. They believe that the parking plaza built all the way across in Lines Area is too far and that customers and employees are reluctant to go there. Therefore a near and close by parking plaza should be built.

Learning

This exercise turned out to be a fruitful one in terms of learning and the benefit we derived from this included the importance of proper planning and team work. Also as we went along in a group and talked to people in the cluster most of them were hesitant and thought we were doing some sort of documentary or related to media. However when we informed them that we are from an academic institution did they relax a bit and opened up to our queries.

The importance of the cluster, its location and practices became clearer to us and it also helped as a bonus that we had some direct contacts in the cluster that helped us out in gathering this information and building this report.

Among the members there was proper work divisions as in the final visit two of the members could not make it to the cluster and were not included in the group picture thus to make sure that there was equitable distribution of work, proper tasks were distributed to them to ensure that everyone participated and played an active role and that there be no free riders at all.