Based on the success of the Japanese Railways model, Pakistan Railways (PR) is currently following a similar strategy of converting its non productive assets into revenue generating and land mark projects. For this purpose PR established the Directorate of Marketing which works directly under the guidance of the Ministry of Railways to launch new business ventures using surplus Railways assets coupled with capital investment fully provided by the private sector.
The objectives of this Directorate are, through public-private participation, to conceive, plan, finance and manage commercial projects which shall generate additional revenue so as to help pay off pay PR’s long out standing over draft with the State Bank as well as to fund developments and upgrading of core operations. The Directorate aims at removing the need for Federal financial by being the first public sector organization to be financially viable and profitable in the long run.
As at the time of establishing the Directorate of Marketing, PR did not possess the requisite professional and managerial expertise to manage such commercial non-rail related ventures, to safe guard the success of this new initiate it was essential to out source the necessary expertise. For this extremely specialized task individuals were needed who could best understand the nature and needs of the private sector from where investment had to be generated. Hence individuals with backgrounds in disciplines of Business Management, Marketing, Sales, Finance and Law from the corporate sector were selected and recruited.
The Directorate compromises of a team headed by the Director Marketing with four Deputy Directors and four Assistant Directors working under him. The Directorate is based at Lahore with branch operations in Karachi, Multan and Islamabad. The Directorate is divided into following functional areas,
1. Advertising Department
2. Franchising Department
3. New Business Development
4. Real Estate Management
A brief detail of the working areas of each of these departments is given below.
The Railways network runs through the length and width of the country and where there is a rail track there is Railways real estate. Most of this huge land bank is situated at prime locations through out all towns and cities which provides advertisers with a very lucrative business opportunity. All advertising related business such as : Billboards, fleet advertising, Platform advertising, corporate and product branding on PR network, rolling stock and properties are dealt with by this department. Commercial deals, identification of locations as well as permissible advertising sizes and methodology of payment have been completely streamlined. The mechanism for advertising on Railways network has also been fully simplified into a one-window operation for prospects interested in advertising anywhere on the entire Railway network through out the country.
New Business Development
This department is responsible for conceiving, planning, financing and managing high value real estate projects through public-private participation through out Pakistan. These commercial projects are primarily initiated on real estate assets which were previously either unutilized or under threat of permanent encroachment. Most of these projects are initiated on extremely competitive terms thorough joint venture agreements. For this purpose alone, for the first time in its history, Pakistan Railways has opened a foreign currency account to receive foreign remittance coming in against projects initiated by this department. This department also over sees the commercialization of institutions previously under the management of Railways but due to lack of proper supervision had become neglected, run down, and inoperable and as a result a considerable financial burden on Railways. Since these institutions were at one time the high lights in the Railway portfolio it was ensured that during commercialization the original purpose of these institutions were not changed. These institutions are now being renovated and shall be fully equipped and functional to provide a host of services to both the Railway employees as well as the general public, and will be a constant source of revenue to Railways. Some of the institutions which have been commercialized by this department include Railways hospitals, schools, clubs and sports stadiums etc. Despite its modest setup and relatively short term of existence, all these benchmark results have come about in just under a year of operations of this Directorate. However, the most outstanding success of this Directorate has been in its ability to build and maintain investors confidence despite the heavy odds. Today the Directorate of Marketing is bringing multination such as Coca Cola, lever Brother, Nestle and McDonalds onto its network as well as bringing in direct foreign investment into Railway projects from countries such as Malaysia, Thailand and Dubai, Singapore, Europe etc. With the growing momentum of this Directorate’s operations it is hoped that I the near future PR can once again be perceived as the most professionally managed and marketed public asset and ultimately become the pride of the entire nation.