Part 1: Family Business Overview and Stakeholders
Descriptive Overview of the Business
. ‘Saleemi Book Depot’ is amongst the famous family businesses in Pakistan. The business founded in 1967 by Shareef Saleemi as a single owner of the company with his three sons named Saeed Ahmad, Muhammad Rasheed and Muhammad Shafeeq. Mr. Shareef started as a book store that provides books for school, stationary and office products to the local area and the shop was located in local area because it was cheap to pay for rent. After the hard work of years Mr. Sahreef started working as a wholesale dealer and start expanding the operation of the company by buying a Van to supply products to the shops in different areas in 1980. In 1988, a major backward integration took place by starting production of Copies and Registers in the main City of Lahore. In 1990, new partner introduced named ‘’Tariq Munir’’ son of Mr. Shareef,s brother and another big van bought to expand operations at higher level.
Organisation’s stage of development on the three dimensions of ownership, family and business
By changing the location of the show room and store room from local area to the town center was a major successful change in the business by Mr. Sahreef in 1993 whereas, in 1996 Mr. Shareef passed away by distributing the partnership in three brothers and one cousin four in total. New factory was purchased in 1998 with the name of ‘Zubair Copy House’ which increased the production of the supply for the show room. In 2000, Mr. Rasheed and Mr. Shafeeq two youger brother of Mr. Saeed decided to leave the and Mr. Saeed introduced Mr. Jabbar (Nephew) as an official partner with Mr. Saeed and Mr. Tariq (Cousin). After that Mr. Saeed Ahmad the eldest son of Mr. Shareef took care of the operations very well by being an official distributor of ‘’Ittehad Group of industries’’ in 2013.
Genealogy charts and Key Events Timeline
The city of Ahmadpur east was under developed so the roads were too small, in 2014 government gave the orders to expand the road of town center which led to the change of location for the show room at the same place of Store room and joined both operations in single point to become more efficient. 2015, 2017 and 2018 were the main years of the big success of the company as the company opened New Show room on ground floor joined with the store room on the upper 4 levels of the building, bought new automatic machine for the production of copies and registers as before that all the products were hand made, and introduction of computerized system with the introduction of barcode system on the full stock produced by ‘Zubair Copy House’ respectively and the sales increased by higher percentage than ever before.
At current stage the Company is operating as Four partner as Mr. Hamza Saeed son of Mr. Saeed and grandson of Mr. Shareef joined the company along with three main partners. The family enterprise organizational chart is shown below in figure 1.1.
The business has had a sound financial performance over the years since its inception and this has left many investors in the market ready to either input their resources or partner with the business to make it more competitive and profitable. It is imperative to note how much this growth is being impacted by the stakeholders. As mentioned by Drakopoulou et al, (2016) the first stakeholders of the business are the owners as well as those who have partnered with it to ensure that it is successful in the market. The owners being the first-hand stakeholders have to make decisions that are inclusive of other key stakeholders who ensure that the business is running smoothly every single day. These stakeholders include the suppliers as well as those who are not from the first family: the employees, retailers, as well as customers. Looking at the total investments made in the company, it is the owners’ and the partners who have contributed a large percentage of it and therefore, the creditors to the business cannot be considered to be stakeholders. What makes the suppliers crucial to the business is that they have a running contract that is renewed over-time to ensure that the goods and services required are provided in due time. This is an implication that the contracts provided by the business to the suppliers reduces the chances of high risks. Additionally, depending on the performance of the market, the prices are negotiated and a mutually agreed tag in the market applied which assures suppliers of a continuous return on their end because they provide their suppliers within the specified time.
The company required a lot of investment at its initial stages because it had to be stabilized so as to perform its duties without worry of financial drawbacks. This was followed by the fact that the product being provided in the market by the business is not perishable and therefore, it can be stored for a longer period with the assurance that it will be sold to a customer in the market. This is further substantiated that when suppliers provide their products to the business, they are paid so as to maintain the trust between the two, but retailers partially access the product on credit thus inserting much pressure on the advertising and marketing dealers to make sure that the products available in the market reach the customers.
In addition to this, the company is currently performing well in the market as there is only one major competitor in the region thus putting it at the forefront of making sure that it penetrates to all parts of the region to access more customers. It also implies that there is so much emphasis being directed towards the will of the customers and their purchase power because the prices are what affects what can be accessed in one region or the other. With this in mind, it is clear that there is less risk from the customers as having one major competitor puts the business at the center of making every important move to secure the market’s dominance. It is also critical to put focus on the customers who are always ready to pay whatever price has been decided by the partners and stakeholders as well as those who are price-sensitive as they will ask what the product costs before it is bought.
Part 2: Issues and Recommendations
The business is not fully owned by the family as partners have also claimed a stake in the shares and this makes it hard for some key decisions to be made by the family. The operations of the family are also involved in these issues because there might be some areas bringing in problems thus making the business hard to manage. However, the chart we provided indicated that none of the family members has been able to join the business at the same time which makes it very hard for the succession to be determined because some have to be introduced to the business, only to leave after sometime. This puts the business at risk because the family is not involving itself fully in the business and it is difficult for the business to penetrate in some of the regions where its major competitor has already established itself.
Mission (creating innovative products with the aim of generating exceptional returns).
Business Model (multiple products across a wide variety of lines).
Planning and follow-up (reliable suppliers in the market).
Focus on employees and customers (training employees to achieve customer satisfaction).
Market share (consumers spend less on nonessential goods).
Different work cultures (the integration of a work culture by the firm has not been successful).
Poor financial planning (financial planning process exhibits some flaws).
Available Market (large market of consumers seeking books provides additional growth).
Investment in quality product (quality of products in the market is improved hence better pricing strategies).
Revenue diversification (availability of a large market of consumers prompting more books to the supplied).
Competition: (the major competitor is targeting the growing large market of consumers).
Economic downturn: (a fluctuation in the economy would negatively impact the market at large as less consumers will demand the products).
Litigation or law changes: (any changes in taxation laws would prompt the business to re-think its model so as to keep their operations afloat).
Opportunities: the company has a mission statement that is focused on ensuring that its products are innovative and they are able to reach a wider market to provide exceptional returns. The business model has also been expansive on making sure that the different lines in the market have at least a product that is attached to them. The suppliers for the business have always been paid in good time and therefore, planning for other business activities is easier and less expensive. Finally, the business has trained its employees to focus more on the customers so as to attract more of them and make sure that they are satisfied as it will be step towards maximizing its annual turnover.
Drakopoulou Dodd, Sarah and Jones, Paul and McElwee, Gerard and Haddoud, Mohamed (2016) The price of everything, and the value of nothing? Stories of contribution in entrepreneurship research. Journal of Small Business and Enterprise Development, 23 (4). pp. 918-938. ISSN 1462-6004, http://dx.doi.org/10.1108/JSBED-03-2016-0049
Mr. Saeed Ahmad
Mr. Tariq Munir
Mr. Hamza Saeed
50% profit share
Major decision making power
10% profit share
30% profit share
10% profit share