Commercial Analysis of the Industry in 2nd Tier Cities of Pakistan

In this particular section, we will examine the retail trends of 3 major sectors in the 2nd Tier cities
of Pakistan. Prior to that, let’s first dissect what is the implication of seeing the retail trends in the
2nd tier cities of Pakistan and secondly, why only these 3 major sectors. First of all, let’s open up
about the very sectors we will be inspecting.
1) Supermarts
2) Shopping Malls
3) Pharmacies
We’ve chosen these sectors because by default these are the major areas which are potential buyers
of the HVAC products on large scales. Other than that, we are focusing on the second tier cities of
Pakistan because that will actually dawn upon us the very fact that retailing in Pakistan has been
on boom in general and it is now not only limited to the KLI. For analysis purposes, the 2 nd Tier
cities we have considered for our research are:
 Faisalabad
 Sialkot
 Rawalpindi
In this section, we’ll go through each of these cities one after another and observe the commercial
and retail potential in the city. Our findings stated in this section are based upon both visits and
secondary research.

Faisalabad
Faisalabad is the third most populous city of Pakistan. It is also the hub of the textile industry of
Pakistan. Due to the fact that the city was in close proximity to Lahore, second largest city of
Pakistan, almost a decade ago, most people from the city would prefer going to Lahore for better
academic facilities, shopping and for other activities. But within last 5-6 years Faisalabad has seen
growth in terms of private education, health, entertainment facilities and other amenities. In the
last 10 years 3 private universities have opened up. Now that the Government is giving rebates and
other relaxations to the Textile industry, jobs have spurred up and more number of local youth are
employed in the city due to which disposable income has been on the upside.
Commercial Analysis: During the last decade, supermarts in Faisalabad has become a thing.
Before that there had been traditional Kiryana stores where people would go and shop for grocery.
But with the advent of Metro, it is quite evident that Faisalabad does have a market. Soon after
Metro, Al-Fatah jumped in which had been quite a success in the city. Faisalabad also has Imtiaz
Store, Chase up which speaks of the underlying demand in the city. Other than that, Super stores
like City Super Mart, Marhaba mart which are quite famous.
The presence of big names of the retail industry and new local players in the city indicate the fact
that Faisalabad has a booming market for the super marts. Our correspondence with the locals also
exposed to us the fact that more number of super marts are being opened now than ever because
the trend of housing societies have become a thing now in Faisalabad and local people find it
convenient to shop from a supermart than a kiryana store because of facilities like parking spaces,
discounts and all under one roof factor. So we can assume that Faisalabad can be a potential market
for HVAC products specifically the air curtains.
Faisalabad had always been famous for its 8 bazaars which would sold literally everything a buyer
would want to buy. But due to the rise in population and change in consumer behaviors, now more
and more people are looking for alternate ways to shop. The trend of shopping malls had been on
the upside in KLI since more than a decade now but it has now also engulfed the 2nd tier cities.
While we were doing our research in Karachi, we observed that all Malls in Karachi have installed
air curtains and the establishments of mall directly imply that more air curtains could be sold in
Faisalabad as well. Following are the major malls in Faisalabad:
 Mall of Faisalabad
 Grand Atrium Shopping Mall
 The Boulevard Mall
 Sitara Mall
 Misaq ul Mall
 Kohinoor One
 China Family Shopping Mall
It is interesting to note down that all the malls stated above were established after 2010 which
proves the fact that the trend of shopping via malls has been going well in Faisalabad and in time
more number of malls is imminent.
Globally we’ve seen that consumers have become more concerned about their health, which
resulted in the rise of the health industry. Faisalabad has seen growth in this sector as well. More
private hospitals have been established in the city than ever during the last decade. Establishment
of hospitals and health centers resulted in the rise of the peripheral health industry as well. Like
pharmacies, clinics etc. One of the biggest local pharmacy chains ‘Servaid’ has also been launched
in the city other than that there has been more than 10 big international standard pharmacies that
locate in the city. As in Karachi & Lahore, bigger pharmacies with maximum footfall would tend
to use Air curtains, we can also assume that with the establishment of such pharmacies and clinics,
our product under consideration has a market in the city.

Sialkot
Sialkot is one of Pakistan’s industrial city. The city has a thriving population of 0.67 million
inhabitants and is home to the world renowned Football manufacturing and Clinical apparatus
manufacturing industry.
Commercial Analysis: During the last decade, Sialkot has seen humungous growth in the
commercial sector at least. There has been opening of malls, cinemas, restaurants, pharmacies on
the pattern of metropolitan cities which has been well received by the locals. Early on there had
only CSD store in the Cantonment that would cater to the need of the upper middle class and upper
class in the city. But after the passage of time Supermarts like Sialkot Bazaar, One Place & Hatim
store has made shopping convenient. These stores follow the model of Imtiaz and other stores
where discounts are offered on a regular basis to lure more buyers and they are doing pretty well.
Locals were of the view that after people have been exposed to such grocery stores now they want
more in Sialkot because there are lesser marts and demand is high. They also said that people from
the adjoining towns and tehsils come over to Sialkot for grocery and more super marts would be
good for the city. So it is quite evident that due to the demand not being met more super marts
shall open up and it is only a matter of time.
Sialkot has also embraced the culture of Shopping Malls like mega cities. Modern Sialkot very
much like Faisalabad was built during the colonial rule, so the city was designed around the clock
tower. Around the clock tower there were multiple bazaars where people would show up to shop
but the bazaars seem crowded. There is hardly any space for parking so the people are inclined
towards going to malls which offer ample parking space, food courts, cinemas and other activities.
Famous malls in the locality are:
 The Mall of Sialkot
 Kent Mall
 Duran Shopping Mall
 Royal Tag
With a thriving mall culture we can assume that there is a market the HVAC products.
There has been several bigger pharmacies in Sialkot. Servaid is the top one which was established
recently. But there is room for more. Because more number of people that come to Sialkot from
smaller towns come for medical treatment. But there are only a few big enough pharmacies with
international standards. There is a market for more because with more and more people coming
in, there would be space for more people to sell medicines. For the HVAC industry it means more
potential customers to do business with.

Gujranwala
As par the economic figures, Gujranwala alone contributes 5% to the national GDP of Pakistan
and after Karachi & Faisalabad, it is the 3rd major industrial city of Pakistan. It has a population of
2.2 million inhabitants. It is a historic city and had been the capital of the Sikh rule under Ranjit
Singh.
Commercial Analysis: Gujranwala is home to around 2500 small and medium sized
manufacturing units, around 25000 cottage units and some large units. Its major produce is sanitary
fittings & wares but the city produces tonnes of other items that are exported. Gujranwala has seen
massive growth in the commercial avenues during the last 10 years. There has been upgrade in
infrastructure such as roads, flyovers, bridges which has made the city an outlook of a modern
urban center. Pretty much like other 2nd tier cities the trend of shopping malls in Gujranwala has
gone widespread during the last decade. More than 3 malls have opened up and more than 2 at
least are being established which speaks about the potential of the city market wise.
More than a decade ago, inhabitants of Gujranwala would prefer coming over to Lahore for
shopping and grocery due to it being located on a 45 min drive away from Lahore. But in the last
6-7 years retail has been booming. Imagine Imtiaz Super Store opening up its first store away from
Karachi in Gujranwala not in Lahore. Our correspondence with the locals brought us to the fact
that being an industrial city, the inhabitants has the capital but lesser avenues to spend on so they
rather spend on food or traveling away from the city for a while. But now that Malls are being
created, Super marts are being established people are spending more money than ever, that too
staying in the city. Other than Imtiaz there is Stop n Shop and Super United Store which are quite
known in the locality.
Pretty much like every 2nd tier city there has been only a handful of bigger pharmacies that operate
like those in the metropolitan cities. But now as there has been growth in other commercial sectors,
bigger pharmacies are also being opened up. One of Pakistan’s biggest pharmacy chains, Fazal
Din has come up with their 24/7 Pharmacy outlet in the city. Then there is Servaid & Bashir Son’s.
Then there are a number of smaller pharmacies. The presence of bigger pharmacies that operate
under modern retail models highlight upon the fact that Gujranwala can be a market for the HVAC
industry to sell out their products to.