KARACHI: After more than 60 years, production of locally made soft-drink Pakola may come to an end as the government reintroduces the infamous capacity tax, which is blamed for devastating Pakistani beverage makers in the early 1990s, industry officials told The Express Tribune.

“Production and distribution of all the bottles, including 300 millilitres and 1.5 litres, has stopped,” said Qamar Pervez, a marketing manager at Mehran Bottlers, which owns Pakola along with brands like Bubble Up, Apple Sidra and Double Cola.

“We are only supplying the product in cans. We can’t afford the risk because of the nature of this tax. What if we go to court, lose, and the tax is implemented? Who is going to pay the penalty then?” asked Pervez. The company markets the cans mostly in foreign markets.

Pervez didn’t say when exactly production was stopped and couldn’t confirm if it was a permanent decision. Managing Director for the company Zeeshan Habib wasn’t immediately available to comment.

The government imposed a capacity tax on the manufacturers of aerated waters in Budget 2013-14. This basically means companies will pay sales tax and federal excise duty on production potential of the machinery instead of actual output.

The tax ranges from Rs1.17 million per valve to Rs4.7 million per valve. The valve is the nozzle of the machine used to fill bottles.

Some local beverage makers have already taken stay orders from courts to stop government from enforcing the tax, industry official said.

However some claim there is an uglier side to this story. Industry members say owners of local beverage companies have thrived on tax evasion.

“They pay sales tax on one truck instead of the three which leave the factory gates. Then they complain they aren’t doing well,” said a businessman affiliated with Lahore Chamber of Commerce and Industry.

Small vs multinationals

The capacity tax was first introduced in 1991 during Nawaz Sharif’s first government. The industry was made to pay Rs65,000 per valve until the decision was revoked in 1994. But by then the damage had already been done.

“Many companies had to shut down factories because of that tax. Until the early 1990s, local beverage companies had 40% market share while the rest was controlled by multinationals. After a few years, we only had a 10% share,” said an industry official who requested anonymity since his company is involved in litigation.

Although multinational firms will end up paying the most because of the size of their factories, they are in a much better position to afford such a hit, claim local producers. Everything comes down to efficiency of the machine and demand for the product in market.

“If they have the latest machine, and mine is 20 years old, how can you compare the two when the owner of the new efficient machine can easily produce more?”

When capacity tax was imposed for the first time in 1990s, the multinational beverage giants had to pay phenomenal amounts in freight to airlift the heavy machinery to Pakistan. The new machines were imported in a matter of days.

There is the problem of power breakdowns and the law and order situation, which often reduces the working hours. “The big company has the muscle to pay all but we can’t,” said the official.

Local producers warn that the shutdown of local manufactures will give multinationals a commanding edge in the ‘price war’

“They are not vying to get the competition. It’s a price war instead. If they sell a bottle for Rs75 instead of Rs85, it’s because we are there in the market selling our product at Rs 65. This is what they want to eliminate,” said the industry official.

Retail and wholesale shops have started to feel shortage of Pakola, which usually sees growth in sales during in the month of Ramazan. Consumers and industry members reacted strongly to the news, which has already been doing rounds on the social media.

Source; http://tribune.com.pk/story/584777/bleeding-green-pakola-fizzles-out-as-capacity-tax-reintroduced/

Want to know why certain people succeed and others don’t. Well successful people have certain traits? Do you have them?

Business has changed a great deal over the years. We now have computers, the internet and because of the internet – web pages, email and everything else that comes with it. Our telephone system has changed dramatically with the advent of cell phones and voice mail. However, even with all the technological advancements the traits that make a person successful in business can be traced way back when to our grandfather’s day. So before you decide you want to go into business for yourself, check and see if these traits are part of your make up.

Are you a person who sets goals? Most successful people have always set goals. They started at a very early age. They might have set the goal to be the best in a certain sport, or in a specific subject in school. Or if they wanted something, and knew that their parents couldn’t afford it, or wouldn’t spend the money for something, they earned the money themselves. They did this by setting up the lemonade stand, mowing lawns for neighbors, or delivering newspapers.

This is the same person, who as they got older, developed other goals and worked for them. Maybe they haven’t reached all of their goals, but they have always known what they wanted out of life. They have a vision for their future and they never lose sight of it. They keep revising and setting new goals for themselves. It is incomprehensible to them that everyone doesn’t do the same. They wonder how other people can live without striving for certain things.

The next trait is that the successful entrepreneur knows their strengths and weaknesses. They also face up to their fears. This means that they don’t let their egos get in the way. They know when they need to learn new skills or take other steps to make their business or themselves better. Due to the technological advances over the years, the skills and steps they need to take might be different; but the attitude has not. So do you have the attitude of a successful business person. To have this attitude you must realize that you are never done with the learning process, and you have to welcome any chance to improve your skills and knowledge.

Another trait is that they are always looking for opportunities. They could be in business or just getting started. In either case they know there are opportunities out there waiting for them. They also know that they need to find the opportunity that will work for them. Even those already running a business, are still open to possibilities.

Successful people will see opportunities other people miss. They also look at things objectively and ask the following questions:

1. Is this really as good as it sounds?
2. Is this something I really want to be doing?
3. Do I have the required skills or can I develop them?
4. Will this help me to reach the financial goals I have set for myself?
5. What impact will this have on my family?

A particularly important trait of the successful person is they will grab at an opportunity and take advantage of it, however they do not act impulsively. They take advantage of opportunities that come their way because they don’t want to be a shoulda, coulda, woulda type person. They don’t want to look back later in life and say I wish I had.
The next trait successful people have is that they like to know where they stand. They know their own business inside and out. However, they also know about their competition. They also know how well their own business measures up. And since they set goals they know exactly where they are in regards to reaching the financial goals they have set for themselves.

Successful people know how to handle budgets and finances. This is a very important trait. They are very cognizant of all phases of their finances. How much they owe, how much they have borrowed, interest rates, and anything else that can effect them. They always save for a rainy day. They are very much aware that they need to spend money to make money, and will put off expenditures for themselves (house, car, vacation) until they can afford it.

Another trait that successful people have in common is that they also don’t settle for second best. They like things done in a certain manner. They have standards that must be met for themselves and their product. If they work with an outside company and that company sends them something that is not up to their standards, they will return it. They look for the best products and the best workmanship in the price category they are working within. They would never put out a half hearted effort for a customer. If they realize they haven’t done a good job or haven’t done it right, they will do it again or set things right with the customer. This is why their customers are loyal to them and want to continue to do business with them again and again. Remember repeat business is why you are in business. If you don’t make a good impression the first time, you won’t get a second chance.

The successful entrepreneur has fun doing what they do. While they might not enjoy every aspect of their business, they enjoy the work that they do. One common theme you will find among them is that they enjoy it because its theirs, and they know they are building something for the future.

They also don’t mind putting in long hours because they know that this time is necessary in order for them to move forward. The owner wears many hats: sales calls, bookkeeping, and making sure that customers are satisfied and happy with their product and/or service. They also need to set up appointments, meet deadlines. However, they also know when playtime is over and it’s time to get down to business.
Another trait they all have in common is they get help when they need it. They will contact other professionals when warranted. They would rather be safe than sorry. They realize they are not experts in everything. They also realize at some point in their business that they can’t do it all, and that they have to delegate responsibility to either an outside source, independent contractor, or that they might have to hire an employee.

So, do you have the traits to become a successful entrepreneur?

Reference: http://www.4bn.co.uk/community/articles/traits-of-the-successful-entrepreneur