Mohammad Ehtiati, Chairman and Managing Director of the NPC subsidiary Petrochemical Commercial Company (PCC) talked to NPC News Bulletin about the PCC's plans for the future. PCC is responsible for exporting NPC's products and importing spare parts and chemicals for its complexes.

Q. NPC's development projects are gradually coming on stream. Most of these projects are export-oriented. What are the PCC's programs for marketing an influx of products?

A. As new projects are being brought on stream, we must muster our existing potentials and create new capacities both logistically and commercially in proportion to our production targets. Commerce is a blend of art and industry. Thus, equipping PCC with its required facilities and tools either software or hardware is a subtle phenomenon and a time-consuming process. NPC has planned to raise the value of its annual production to $7.5 bn by 2005, which is a five-time increase compared with the current figures. In order to respond to and prepare itself for this growth, PCC has, since1998, started to strengthen its existing oversees offices or open new ones. The opening of PCC's offices in Singapore, Dubai, Beijing and Bombay was a new chapter in our activities. We opened them to keep our finger on the pulse and have round the clock information on the needs of our potential clients.


Q. Presently, the bulk of PCC's activities is confined to exporting NPC's products. Do you have any plans to diversify your activities and act as an international trader?

A. We aim to reach a point where besides marketing NPC's products, PCC can be present as a trader at markets where business is economic and profitable. Thanks to our experience and expertise, some local industries and businesspeople have approached us to help them import their required raw materials or export their products. On the other hand, there are always opportunities at the international markets to trade profitably from one market to another despite the risks and ventures.

In order to become active in trading at international levels, 'PCC International Trading Company', which is a UK registered company, has been established. This company will start its activities after the respective formalities are through.


Q. Looking at your last year's export figures (NPC News Bulletin No. 4) it becomes clear that PCC's share of African and South American markets are small. Have you thought of increasing your share of these markets through, say, swapping schemes?

A. There are a number of prerequisites for successful swapping including the availability of a reasonable amount of product and potential customers. Moreover, shipping charges should be economical. We have had cases of swapping, mostly with the neighboring countries like Saudi Arabia, which were of course profitable. But, for distant markets like Latin America and South Africa we prefer direct sales, which are more economic.


Q. There are companies or traders that prefer to serve as a PCC's agent. Do you still follow your policy of not granting agency?

A. Due to certain reasons, the issue of granting agency has not been raised or followed up seriously in PCC. One possible reason is that presently two-third of the NPC's production is consumed locally and only the remaining one-third is exported. Of course, once development and expansion projects become operative we should explore different ways of marketing and exporting our products. I believe this issue can be discussed and planned for after assessing the PCC and its overseas offices' capabilities.


Q. PCC has opened several offices abroad. How can they help you expand your activities?

A.Well, timely presence at intended markets is the art and skill that a successful marketer has. With the advent of sophisticated technologies and their use in international trading, the traditional method of the seller-buyer face-to-face encounter is being superseded by the Information Technology (IT). As a result, the issue of place and locality is losing its importance in marketing. However, we should admit to the fact that the analysis and assessment of the customers' needs require physical presence at the marketplace. Moreover, under similar conditions of equal accessibility to the state-of-the-art technology, those are successful who come to a logical understanding of their targeted market and can win their clients' trust through continual and effective study of their attitudes and tastes. Therefore, statistics reveal that our overseas offices have had successful records. I hope that with the passage of time and continuous training the trend will further improve.


Q. What are your plans for maintaining a larger share of the global petrochemicals market?

A. We have drawn up specific plans to become more active in the petrochemicals markets and to increase our share of the petrochemicals export. We are aiming to enhance PCC's competitiveness by improving its trading structure, expanding the use of electronic commerce, forming joint ventures and strategic alliances with leading international companies. We also have projects to expand and improve our export facilities and terminals. Mastering the customer-oriented strategy and gaining an active presence at international markets are among other plans we are aiming for.


Q. Shipping and freight charges can make a hole in the earnings of companies like yours which are active in export/import? Have you ever considered establishing an international shipping company as a solution?

A. You are right. Parts of our expenses go for international forwarding, but as a new policy we have started entering into CFR contracts for exporting our products since last year. In the meantime, we are negotiating with several companies to establish a shipping company on joint venture basis. We believe it is sensible to jointly found such a company because shipping companies will have regular consignments. Additionally, it is able to generate reasonable profit for PCC.