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1- GROWING TELECOMMUNICATION SECTOR
2- REPAYMENT OF EXPENSIVE LOANS
3- HOUSING FINANCE
4- ACQUISITIONS AND FRANCHISING
5- THE STOCK MARKET SCENARIO

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ACQUISITION & FRANCHISING

 

Foreign brand name for Pakistan products


By AMANULLAH BASHAR
Feb 02 - 15, 2004
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The Export Promotion Bureau (EPB) has launched a scheme for acquisition and franchising of foreign brand name for Pakistani products with view to achieve incremental exports by increasing market share and market penetration.

The scheme is aimed at helping the country to achieve higher value for its products, achieve export of a wider range of value-added products and to provide access to existing marketing network of established brands.

Tariq Ikram, the Minister of State and the Chairman EPB addressing the member of the business community at Karachi Chamber of Commerce and Industry (KCCI) highlighted the salient features of the scheme.

He said that brand name is an important component in the overall marketing of a product and carries a certain image of product's quality, serviceability and after-sale support. Besides marketing edge, established brands enjoy a definite price advantage. Brand loyalty is a key feature of developed markets and is used in most marketing companies.

Some of the exporters in Pakistan are already selling to foreign buyers who make onward sales under their own brand names. Established brand names in developed foreign markets are often available for purchase. Brand purchases/franchises as such could have far reaching economic impact and can be utilized as a very useful tool in Pakistan's strategy of export-led growth.

Those export-oriented companies interested in marketing their products under the flag of foreign brand names would be required to have an export performance of a minimum $5 million average annual exports in the last three years.

The exporters should have their own manufacturing facilities of international standard, preferably those already certified for ISO-9000, ISO-14000 and SA-8000.

In this respect, EPB at its own cost will engage consulting firms abroad to help identify brands available for acquisition/franchising and ascertain probable costs. Products sectors to be covered will be the value-added sectors from amongst our core and developmental sector in accordance to the export strategy. These sectors are including surgical goods, sports goods and sports wear, all food products, pharmaceuticals, furniture, jewellery, marble and granite and selected engineering goods. Exporters may also apply for products not covered in this scheme which will be considered on merits. EPB will also pay for the consultancy services required and will assist the exporters in obtaining bank loans at economical mark up rates to meet the cost of acquisition/franchising of foreign brands.

Under another export development plan namely "Enterprise Capacity Building Scheme", the EPB has decided to hire services of top class consultants of international repute for technology up-gradation, export marketing and joint venture projects.

The selected consultants will assist the interested company in improving quality of products matching to the world market requirements, besides capacity building of the enterprise.

The cost of the consultancy would be paid at 50:50 ratios by the company and the EPB. In order to support the private sector enterprise, the State Bank of Pakistan has also agreed to provide soft term loans at fixed market rate for a period of 7 years.

Another important step being taken by the EPB is promotion of products with the label of made in Pakistan. Under this scheme sale of products through opinion leading stores enhances the respect of the product and the country of manufacture. Experiment made with food products promotions in Harrods and Selfridges in the UK endorses this concept.

It may be mentioned that Trade Policy for 2003-04 envisages promotion of products made in Pakistan through display and retail sale in high traffic shopping malls abroad. EPB will hire display/retail sale space in shopping malls abroad and offer such space to Pakistani exporters producing world class quality so as to project Pakistan as a supplier of quality goods. Promotional scheme will be called "Promoting Products Made in Pakistan". The operation of this scheme will commence after agreements have been concluded for hiring such space in selected countries.

The display and retail outlets will be arranged, in first phase in Dubai, London and New York. The retail outlets will be selected in consultation with the Pakistan missions, cities and the exporters. Working on these lines, the EPB has already acquired land in Sharjah where a display center and a retail outlet will be developed shortly.

The eligibility criteria for this scheme required that the exporter should be one of the top ten exporters of any of the product category.

The exporter should have a branded export product or should undertake to have a brand name for the product duly registered with the Registrar Trade Marks in Pakistan and the official registering authority n the country where the product is put up for display or retail sale. The product should be a consumer product that can be put up for retail sale amongst categories. The items selected for this scheme are including textile apparels and made ups, Carpet and floor coverings, leather garments and leather products, Beauty care products, cutlery, sports goods and sports wear, bicycles, electric fans, kitchen ware, furniture, handcrafts and packaged food products.