Interview with Mr. Fahd Kamal Chinoy – Chief Executive Officer, Pakistan Cables Limited
Pakistan Cables Limited launched its e-store in October 2019. The PAGE team spoke to Mr. Fahd Kamal Chinoy, Chief Executive Officer on Company’s latest advent in e-commerce, making it Pakistan’s first wires and cables manufacturer to sell online.
PAGE: Is Pakistan Cables the first to launch sale of cable through ‘online’ store?
Fahd K. Chinoy: Yes! Pakistan Cables is the first wires and cables manufacturer in Pakistan to launch its very own e-store in Pakistan, through which customers can now easily shop online for general wiring and have their required wires delivered right at their door step.
PAGE: Why the need was felt to open an online store?
Fahd K. Chinoy: You may be aware that in Pakistan the e-commerce market expected to cross US$ one billion by 2020. Within the e-commerce market, analysts anticipate a further growth driven by the surging 50 million middle class people. While the more personal categories such as fashion apparels, perishable items (groceries, fruits and vegetables), etc. are driving the development of the e-commerce segment in Pakistan, I am convinced that the construction materials market segment will follow the suit.
Pakistan Cables is the pioneer of the wires and cables industry in Pakistan. We always set benchmarks in the industry based on our ability to identify trends and address evolving needs of consumers. As the buying habits of Pakistani consumers evolve with the development of online shopping, we want to be there for them as we create a direct touch-point for them.
PAGE: Who are the target customers?
Fahd K. Chinoy: Pakistan Cables e-store is currently available to consumers in Karachi, Lahore, Islamabad and Rawalpindi with plans to roll out nationwide very shortly. It is a hassle free service for the ever-busy homeowners and home builders who depend on contractors/electricians to accompany them as they take time out to visit hardware markets for buying wires and cables. Often they are forced to place their trust in their contractors or electricians, if they are not able to accompany them, which expose them to the potential risk of counterfeits or being overcharged and so on. With the e-store, all these risks are eliminated.
PAGE: Will this help in containing sale of counterfeit products?
Fahd K. Chinoy: Definitely, when consumers buy directly from Pakistan Cables e-store they get the satisfaction of buying authentic product directly from the manufacturer.
PAGE: Doesn’t this increase cost of delivery?
Fahd K. Chinoy: Currently the prices listed on the Pakistan Cables e-store are inclusive of shipping charges and taxes. The incremental cost is nothing compared to the convenience and amount of time saved by consumers as they order online. However, in its early days, it has already received an encouraging response and consumers have appreciated the new facility tremendously.
PAGE: Is smuggling of cable common in Pakistan?
Fahd K. Chinoy: Not really for wiring but certainly there is a lot of power cable being imported into Pakistan and often being mis-declared under the wrong heads for the importer to benefit from lower duties. Also, the government has given certain special projects under the CPEC umbrella and in the power sector duty and tax exemptions that result in imports being more attractive compared to local cables because the local industry is still subject to those duties and taxes. This is an absolute outrage! The local industry is not given a level playing field to imports and is instead disadvantaged.
PAGE: Is cost of production of cable in Pakistan high or low as compared to other manufacturers in the region?
Fahd K. Chinoy: Pakistan Cables has been growing its exports over recent years by offering competitive prices to our international customer base. As a result we have won the FPCCI Export Award for 5 years consecutively.
Generally Chinese, Turkish and Indian cables are extremely competitive by virtue of having an integrated supply chain within their countries for cable related raw materials. On the other hand in Pakistan, a significant amount of the raw material is imported and then converted into finished wires and cables. We have duties and taxes on our imports whereas China, India and Turkey don’t have to deal with this as they are just procuring locally. Having said that if we can have these duties and taxes adjusted through the government’s Duty Drawback or DTRE facilities, we can be competitive. However, we do suffer from some of the highest electricity costs in the region, which makes it challenging.
PAGE: How cost of cable manufacturing can be brought down in Pakistan?
Fahd K. Chinoy: Cable manufacturers rely on precision and controls to ensure consistency of quality, while minimizing wastage, scrap and material giveaway. Tighter controls can be adopted by investing in newer technology and equipment, which help in increasing efficiency, output and reducing wastages. It is for this reason that Pakistan Cables is consistency upgrading its equipment and only relying on the best suppliers of machines. Similarly, we are able to bring down product cost by using best in class raw materials, which allows you to run your machines faster, lowering variable costs.
PAGE: How do you see the future of ecommerce evolving in your industry?
Fahd K. Chinoy: Pakistan Cables e-store is a litmus test for the industry itself and undoubtedly a big step for the cable industry of Pakistan. We are offering a one-of-its-kind facility in Pakistan, which promises improving the experience of shopping for wires and cables. Pakistan Cables is dedicated to make the buying experience of its customers remarkable, as a true a market leader. So far the signs are encouraging and we are keen to learn from our consumers.