P & S Trawlers – Paper 1 Story Line

By: Ms. Dina Moemen – AIS West

 Pekka Heikki’s family
business has been
operating for generations
in the fishing industry

WHERE?

Finland – which is known

They for commercial fishing
flourished at
times, with
good
catches and 5 YEARS AGO
strong market
prices, and A trawler sank in a
sometimes horrible storm
they
struggled.
1-5
 The business has always
been a partnership

10% 10% Responsible:

all other areas
Responsible: of the
Trawlers and BUT business:
crew 2010à Parents decided to Marketing,
convert to Private limited admin., and
40% company 40% finance

WHY??? 1) Increased risks due to expensive boats and uncertainties in the market
2) Greater gov. regulations of the industry --> increased potential personal liability
10 - 15
 Tourists visit Finland for:
• Sightseeing
• Outdoor activities like skiing
• City breaks

Finland has a long coastline

Therefore:
Largest industry: FISHING
2nd largest industry: TOURISM 20
3rd largest industry: TECHNOLOGY à Growing rapidly
 P&S Trawlers Future Uncertainties:

PST has always fished responsibly, with the aim of preserving fish stocks for
future generations. HOWEVER:

• Finland exports large quantities of fish each year --> Gov. concerned
about environmental sustainability due to global trends of overfishing:
hence imposed fishing quotas: on size, types, and weight of catches.

• Recently Finland gov. trade agreements with foreign countries have

allowed foreign trawlers to catch more fish, they are known to illegally
overfish à therefore reducing market prices.

• More technology businesses are relocating to Finland and paying

higher and stable wages à Smaller fishing business are struggling to
survive 25-30
 Positive factors for PST

• Strong determination to face challenges

• Due to careful financial management à survived threats before

• Workers are loyal and hard-working

• Use of latest technology

• People switch from meat --> fish

• Low labor turnover

• Gov. supports responsible and ethically managed fishing businesses.

35-40
• PST owns 3 trawlers, 40 employees.
• Each trawler has a crew of 7.
• Trawlers are often at sea for several days,
as best fishing waters are far away.

• Fish is unloaded when they return to port

under Pekka’s supervision, then kept chilled
in PST’s warehouse. PST freeze some of the
fish.

45-50
• Tapio manages workers in the
warehouse.
• She has a team for record
keeping, issuing and paying
invoices, and managing
subcontractors.

Outsourced services:
• Trawlers’ service
• Transportation of fish to markets
• Fuel providers
• Some HR and Accounting
functions

45-50
 Trawlers
Maintenance
Every 6 months, one trawler is taken for a major service, which
lasts a month. Therefore:

• Trawlers are reliable, outage costs are reduced, and operating

costs are improved.
• Scheduling trawlers has to take planned outages into account.
• Scheduling trawlers and crews can be difficult because of
weather and unpredictable events.

Fishing trips can take longer than planned and crew members
expect time off between trips

Equipment can be damaged and takes time to repair, as well as

replacement of mechanical parts can take up to 2 weeks.
Pekka would like to find ways to make this process easier and
faster. 65-70
 WORKING ENVIRONMENT

Work on trawlers can be very dangerous, so good

• PST has always tried to create a friendly environment
training and discipline are important.
• Teamwork is essential especially between crew members.
1) Induction training: extensive training to all crews
2) On board training: to update the crews’ skills
• PST pays good salaries to crew members, and generous
3) Annual Training at a local college: for health and
bonuses for good catches. 55
safety and safeguarding training
PEKKA’s Working
Environment

Pekka is strict with all aspects of the management of
the trawlers and crews as there is no room for risks,
including:
• Rigorous application of health and safety laws
• Compliance with gov. quotas and regulations
• Accurate record-keeping
He is strict with procedures and responsibilities
All trawlers and overall fishing operations have a clear
command structure.
Pekka supports the trawlers’ captains if disciplinary
matters arise 60
 TAPIO’s Working
Environment

• She is open minded, and

flexible about the ways • She delegates tasks • She operates job
her teams work. whenever opportunities rotation as some tasks
• She encourages new arise. are more interesting
ideas and alternative
than others.
ways of working in the
office and warehouse. 85

100% Male
PST crews have always been
males. However, several
women have recently asked
to work on the trawlers.
Both Pekka and Tapio
recognizes the need for
diversity. Pekka Believes that
diverse crew would be good.
Workers’ Demographics
In the European Union and
Finland, only 3% of trawler
crew members are females.
Finland, all employment is
covered by equal
opportunities legislation.
Tapio is concerned:
• Additional costs
• Practical problems on bard
ships, like sleeping
arrangements.
Pekka is worried:
• About how male crews
might react.
However, due to low labor
turnover, there has been very
few opportunities for women
to work on trawlers.
75 - 80
 DISTRIBUTION CHANNELS

• Hotels
1) fish caught are sold in • Restaurants
local fish market • Fish shops
• Local Residents

Sales to Presto are on a fixed

2) PST sells directly to contract at a price that is usually
Presto lower than market prices

3) Some are sold though

agents to overseas markets

• PST’s fish is very high quality and generally sells at a premium high price. The market is
subject to fluctuations due to factors such as weather, season, and competition.

• Competition is very high; therefore PST is in frequent contact with customers to retain them 90-95
Business news reporters have started speculating that new trade
agreements between countries will make selling overseas more
difficult.

Tapio may have to find some new markets and develop a

revised marketing strategy.
95
Major Items of expenditure:
• Fuel for trawlers
• Salaries
• Rents for office and
warehouse.

Payments:
• Fuel and salaries at the end of
the month
• Rent is paid a month in
advance.
• Local customers pay
immediately.
• Hotels, restaurants, and fish
shops have 1 month credit.
• Super markets have 90 days
credit.
100
 PST has installed recently the latest satellite technology on their trawlers.

This electronic equipment enables:

• Monitoring of fish shoals, thereby improving navigations and the chances of good fish catches.

• Improved technologies enables PST to maintain more detailed and accurate records about
catches and allows it to send this information automatically to the government, which monitors all
quotas.

• Improved materials for nets and modern on-board equipment have reduced the need for repairs
and reduced lost of fishing time.
105-110
 GROWTH STRATEGIES
Pekka this the best way to
grow is through:
Buying updated and larger
trawlers similar to those
operated by overseas
competitors
Tapio wants the business to diversify.
Some of her ideas:
• Opening a fish shop
• offering services and facilities to other fish
businesses
• Finding alternative uses for the trawlers
115