Marketing Mix Strategy of Ratanpur Steel Re-rolling Mills (RSRM)

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Marketing Mix Strategy of Ratanpur Steel Re-rolling Mills Ltd. (RSRM)

Marketing Mix Strategy of Ratanpur Steel Re-rolling Mills Ltd. (RSRM)MD. Nasir UddinShushmita ChowdhuryID: 13102406ID: 13102421

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Presentation Outline

Introductory part Organizational partActual task partProject partResearch part

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Introductory Part

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Objectives of the Study Broad Objective:The broad objective of the study is to assess the marketing mix strategy of steel industry in Bangladesh focusing on Ratanpur Steel Re-rolling Mills Ltd. (RSRM).Specific Objectives:To know if product quality is getting priority over costTo find out the pricing strategyTo find out the location coverageTo know the by-product utilizationTo know if the Sales promotion policy of RSRM is affected due to competitors marketing strategyTo find out the relation of profit margin and competitive priceTo know if the promotional schemes have impact on products demand

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Limitation of the StudyLack of up-to-date data.Time constraint.Data constraint.Lack of perfect co-operation.

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Organizational Part

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Company Profile Head OfficeNahar Mansion, 116 C.D.A Avenue, Muradpur, ChittagongTel: +88-031-652255-57, Fax: 88-031-650001Corporate SloganSteel For The NationDate of IncorporationApril 22, 1986Date of Starting Its OperationJuly 1, 1986Chairman of the BoardMrs. Shamsun Nahar RahmanName of the Managing DirectorMr. Maksudur RahmanWebsitewww.rsrmbd.com

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Background of RSRMRatanpur Steel Re-Rolling Mills Ltd. (RSRM) was established in January 1984.The mill is situated in the progressive Baizid Bostami Industrial Area, Chittagong.Leading steel manufactures Incorporated on 22 April 1986Commercial production in 01 July 1986Production capacity to1000 tons per dayPrincipal product of the company is M. S. Rod 60 GradeInstalled production capacity of producing 3, 00,000 MT annuallyMain raw materials of the company are M.S. Billet

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Vision and MissionVision:To be the trend setter and the power force of the steel re-rolling industryMission:To be the first name in the regions steel industryHarnessing our assets and resources to achieve profitable growth, Operational and organizational excellence and Good corporate citizenship

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SWOT

10Strength: Market Leader Great Competitive Skill Reliability Strong employee bonding and belongingness ModernEquipment&Technology Strong ProductsDistributionLineup Strong Marketing LineupWeakness: High interest rates decline profit Power crises

Opportunities: Market Dominance Organizational Goal Increased demand for the products International ScopeThreats: Newcompetitors Economic crisis GrowingCompetition Labor Unions Power Crisis

11Porters Five ForcesNew Market Entrants (Low) Bargaining Power Of Buyer (High)Bargaining Power of Supplier (Low)Rivalry Among Existing Firm (High)Threat of Substitute Products (Low)

Capital RequirementGovernment PolicyEconomies of scaleIncreasing Demand for SteelLow per capita consumptionBargaining power of buyersEnergy supplyLabor union powerBargaining powerProduct differentiationCompetition from Foreign Players

Aluminum

12PESTEL Analysis National Steel Policy Opportunities available in ppp Foreign Direct Investment Huge Gap between the Demand and Supply Permanent Employment Development in the Rural Areas

Online Trading Planning to Use Latest Technology Encouraging the eco Friendly System RSRM is developing the Ultra-Low Carbon various rules and regulations Health policies of the employees Special health incentives and rules

13Organogram

14Board of Directors

Products

150102

BSRMKSRM BSILAKSRRM

16Competitors

17Actual Task Part

18Nasirs task:Collected information through web browsing about fire safety productsMade profile for the Fire safety productsEdited the picturesMade a list of solar companies Collected information through web browsing Made profile for solar energyMade a list on compressor companies domestically and internationally Field work

Tasks done by us at RSRM

ContdShushmitas task: Research on Vietnam: Basic DataWhy invest in VietnamWhy foreign investment in Vietnam is boomingLargest companies in VietnamRMG & textile in VietnamTax rate in VietnamVietnam Corporate Taxation & special sales taxOther tax rates on resident individualsBarrier to entryTesting and ApprovalsExport & ImportGarment manufacturing companies in Vietnam

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Research on Myanmar:Basic DataMyanmar GDPIndustry & RetailTrades & InvestmentFinancial ServicesGerent, textile, and leather companiesConstruction and real state companiesChemical, cosmetics and health companiesField work

20Contd

21Project Part

Represents a blending of four elementsAlso known as 4 PsProduct, price, place and promotion Basic purpose is to satisfy the needs of customers

22Marketing mix

23Product Mix OF RSRM

Produced by the use of most advanced Heat-treatment technologyQuality of this bar is more higher than MS barMost used bar at presentHigh durabilityHigh ductilityHigh load bearing capacityHigh elongation

24Deformed Bar

Load bearing capacity is 40000 psi or 40000 pound per square inch in 300MpaYield strength is more than 300Mpa per square inchUltimate tensile strength is minimum 350Mpa per square inchElongation is more than 6%

25Gr. 40/ 300 Mpa Deformed Bar

Gr. 40 Deformed Bar

More yield strength then RSRM MS barReasonable elongationReduce 5% steel weigh from constructionReduce column size and quantity of RodResistance to fatigue behavior Have better bonding with concreteSafely weld-able

26Specification of Gr. 40/ 300 Mpa Deformed Bar

Underground of the buildingsGovt. constructionLow budget concreteBasement of the buildingSlap over the drainSmall ColbertFlooring of the basement

27Use of Gr. 40/ 300 Mpa Deformed Bar

Load bearing capacity is 60000psi or 60000 pound per square inch of 400MpaYield strength is more than 400Mpa per square inchUltimate tensile strength is minimum 450Mpa per square inchElongation is more than 8%

28Gr. 60/ 400 Mpa Deformed Bar

Gr. 60 Deformed Bar

More yield strength then RSRM Gr. 40 barReasonable elongationReduce almost 10% steel weigh from constructionReduce column size and quantity of RodResistance to fatigue behavior Response to tensile loadingResistance to corrosion behavior Safe 0.05% steel at welding

29Specification of Gr. 60/ 400 Mpa Deformed Bar

Grand column of the buildingOver bridge Foot overFly overLarge size bridgeLarge size reinforced concrete

30Use of Gr. 60/ 400 Mpa Deformed Bar

Branded this product as RSRM X Power TMT 500 bar.Load bearing Capacity is 75500psi or 75500 pound per square inch of 500MpaYield strength is more than 500Mpa per square inchUltimate tensile strength is minimum 550Mpa per square inchElongation is more than 12%

31RSRM X Power TMT 500 Bar

High design yield strength of minimum 500 MpaHigh elongation Reduce almost 25% steel weigh from constructionReduce the earthquake damage Reduce column sizeResistance to fatigue behavior Response to tensile loadingResistance to corrosion behavior Reduce the wastage at welding more than 5%

32Specification of RSRM X Power TMT 500 Bar

500 TMT Bar33Fly overMultipurpose buildingsMultipurpose bridgesSkyscrapers Over bridgesFoot overGrand column of the buildingsAll kind of mega structures

Use of RSRM X Power TMT 500 Bar

Its a low carbon steel where the amount of carbon is 0.08% to 35%.The shape of this bar is round.This bar produced directly from billet without use of heat-treatment technology. It is equivalent to ASTM (American Society for Testing and Materials) A615 Standard.Yield strength is 300 Mpa to 320 Mpa.Ultimate tensile strength is 350-360 MpaElongation is 4%-6%

34MS Bar or Round Bar

Limited Capacity in yield strength and load bearingRequired more in terms of quantityMinimum weld ability and bend abilityIncrease the weight of concrete not suitable in large construction

35Specification of MS Bar

MS Bar

Small reinforced concrete Small construction workBasement of the buildingFoot path and foot waySmall ColbertFlooring of the basement

36Use of MS Bar

High durabilityMore accurate weight of the productEnsure high qualityStrictly follows the international standardsThe bars conform to ISO 9001: 2008, BSTI, and ASTM StandardHigh ductility and high elongation

37Feature of Product of RSRM

Oval Rubbish

38By-Product of RSRM

Slogan:Steel For The NationLogo:

39Branding of RSRM

Factors influencing pricing decisions:Competitor analysisMediaSeasonal factorsCost of production

40Price Mix of RSRM

Pricing procedure of RSRMRSRM applied the following pricing strategy:Cost-based pricingCompetition-based pricing Promotional pricingSegmented pricingDiscount and allowance pricing

41Price Mix of RSRM (Contd..)

Cost-Based pricing procedure of RSRMCost-Based pricing of RSRM = (cost + profit)RSRM consider the following factors in cost-based pricing:Cost of raw material Customs cost of releasing raw material Production costProcurement costCost of machine maintenanceCost of powerSudden incidental and accidental issue

42Price Mix of RSRM (Contd..)

Competition-Based pricing procedure of RSRMRSRM applying this pricing strategy in two ways:Going-rate pricingSeal-bid pricing

43Price Mix of RSRM (Contd..)

Promotional pricing procedure of RSRMRSRM offers the seasonal promotions offer for all customer such as:Sale on special discount rate of 500tk-1000tk for a certain period of time Dealers get the incentive quarterly on product lifting, storage and sales.

44Price Mix of RSRM (Contd..)

Promotional pricing procedure of RSRMSegmented pricing of RSRM depends on the seasonal appearance such as:Price is reduced in rainy season and the discount rate is low at that timeAgain price is increase in winter season and the discount rate is high at that time

45Price Mix of RSRM (Contd..)

Discount and allowance pricing procedureof RSRM:Dealers of RSRM get fix amount of 1000tk as discount per tonCorporate customers get the discount of 300tk-500tk per tonEnd user also get discount on special offers

46Price Mix of RSRM (Contd..)

47Place Mix of RSRMCorporate CustomerEnd userTradersGovt. construction/ projectsProjects/ small dealersEnd userRSRMDealersEnd users

Qualities of channel members of RSRM:Financial condition of the willing dealersMarketing experience and capabilityPrevious back ground of the dealer as good payeeMarket reputationLocation of shopGood willNegotiation power

48Place Mix of RSRM (Contd..)

Name of distributors of RSRMDealers:Al-Amir & Sons Amin trading CoBarik BrothersRSRM (Corporate, Chittagong)Coxs Bazar Builders StoreJoni Steel CorporationM. Rahman EnterpriseM/S. Sarkar & Co. etc.

49Place Mix of RSRM (Contd..)

Traders:Khan and Sons Progoti MetalsPopular Steel ShopS & S Metal WorksMinoti TradersMonsur Ali Traders

50Place Mix of RSRM (Contd..)

Developers:ANZ properties Ltd.Equity properties Ltd.Ideal Development Ltd.BTI development

51Place Mix of RSRM (Contd..)

Main Promotional objectives of RSRM:To face competitionTo educate the customersSurvive in the completive marketIntroduce the product to whole world To maximize the saleTo sustain and enhance the brand as well as corporate image

52Promotion Mix of RSRM

Promotional tools of RSRMAdvertising:RSRM uses the following media for advertising:Print mediaLocal and national dailiesTVCNoticeShop signsHoarding boards Project sign board

53Promotion Mix of RSRM (contd..)

Promotional tools of RSRMSales Promotion:RSRM uses the following sales promotion:DiscountCredit salesAllowanceIncentives to dealers Gift for valuable customerSpecial offer for developers

54Promotion Mix of RSRM (contd..)

Promotional tools of RSRMPublic relation & Publicity:Public relation and publicity of RSRM are:Sponsorship to several workshopsDonating to workshop, seminarsCorporate social responsibility

55Promotion Mix of RSRM (contd..)

Promotional tools of RSRMPersonal Selling:The sales force of RSRM personally visits all customers to:Give idea about productPromote the productInfluence by the product

56Promotion Mix of RSRM (contd..)

Promotional tools of RSRMDirect Marketing:RSRM is practicing direct marketing by:Mass marketing with all types of customersOne- to- one marketing with developers and group of companies

57Promotion Mix of RSRM (contd..)

58Research Part

Our report is based on marketing mix of Ratanpur Steel Re-rolling Mills Ltd. (RSRM). The focus of the study is analyzing the current marketing mix of RSRM. Based on the problem analysis recommendation is been given.

59Problem Statement

60Methodology of the StudyPrimary Sources: Face to face conversation Interview with the Company manager, executives Some data has been collected through the questionnaire.

Secondary Sources:Secondary data are collected from the following sources: Annual reports of RSRM Official files Data available with the website of RSRM

Sample size:A total of 40 respondents have been conducted, where were employees of RSRM.

Questionnaires Scale:Strongly Disagree ..1Disagree ..2Neither Agree nor Disagree ..3Agree ...4Strongly Agree ...5

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Hypothesis Test:

Z test =

= Mean valuen = Sample size = Standard Deviation = AverageBased on my analysis we have made findings, limitation, recommendation and conclusion.

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Liker Scale H1H2H3H4H5H6H7H8H9H101= Strongly Disagree 00565247462= Disagree 532254462553= Neither agree nor disagree54420402014= Agree61037881086105= Strongly Agree2423620232220212518Total169173103150160164156154163149Average 4.224.322.573.7544.13.93.854.073.72Standard Deviation1.080.921.241.521.441.221.411.521.411.49Z-test value10.1112.550.155.26.818.336.365.627.135.30

63Methodology of the Study

1. HO: Product quality is not getting priority over cost HA: Product quality is getting priority over cost.We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here, = 4.22 = 1.08Z cal = ( )/ (/n) = 10.11At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the product quality is getting priority over cost.

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Graphical Representation

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2. HO: Market penetration has not been used as pricing strategy HA: Market penetration has been used as pricing strategy.We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here , = 4.32 = 0.92Z cal = ( )/ (/n) = 12.55At 5% level of significance, follows Z Distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the market penetration has been used as pricing strategy in RSRM.

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Contd..

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3. HO: Market skimming has not been used as pricing strategy. HA: Market skimming has been used as pricing strategy.We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 2.53 = 1.24Z cal = ( )/ (/n) = 0.15At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal < Z tab, the null hypothesis is accepted. So at 5% level of significance, it can be said that the Market skimming has not been used as pricing strategy in RSRM.

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Contd..

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4. HO: Segmented pricing has been used for products HA: Segmented pricing has been used for productsWe want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 3.75 = 1.52Z cal = ( )/ (/n) = 5.2At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the segmented pricing has been used for products in RSRM.

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Contd..

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5. HO: RSRM is not covering the major city areas. HA: RSRM is covering the major city areas We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 4 = 1.44Z cal = ( )/ (/n) = 6.81At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that RSRM is covering the major city areas.

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Contd..

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6. HO: RSRM is not covering the rural areas. HA: RSRM is covering the rural areas.We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here, = 2.55 = 1.64Z cal = ( )/ (/n) = 0.02At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal < Z tab, the null hypothesis is accepted. So at 5% level of significance, it can be said that the Market skimming has not been used as pricing strategy in RSRM.

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Contd..

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7. HO: By-products is not being utilized. HA: By-products is being utilized.We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 3.9 = 1.41Z cal = ( )/ (/n) = 6.36At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the By-products is being utilized in RSRM.

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Contd..

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8. Ho: The Sales promotion policy of RSRM is not affected due to competitors Marketing strategy. HA: The Sales promotion policy of RSRM is affected due to competitors marketing strategy. We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here, = 3.85 = 1.52Z cal = ( )/ (/n) = 5.62At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the Sales promotion policy of RSRM is affected due to competitors marketing strategy.

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Contd..

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9. Ho: Profit margin sometimes cannot be compromised to maintain competitive price HA: Profit margin sometimes can be compromised to maintain competitive priceWe want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 4.07 = 1.41Z cal = ( )/ (/n) = 7.13At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the profit margin of RSRM sometimes can be compromised to maintain competitive price.

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Contd..

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10. Ho: The promotional schemes of RSRM does not stimulate the products demand. HA: The promotional schemes of RSRM stimulate the products demand. We want to test the null hypothesis HO: = 2.5 HA: > 2.5 n = 40Since the sample size n > 30 so, we may use Z - test.Here = 3.72 = 1.49Z cal = ( )/ (/n) = 5.30At 5% level of significance, follows Z distribution Z 0.05= 1.645Since Z cal > Z tab, the null hypothesis is rejected. So at 5% level of significance, it can be said that the promotional schemes of RSRM stimulate the products demand.

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Contd..

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RSRM product quality is getting priority over cost as majority respondents are strongly agreed with this statement.Market penetration has been used as pricing strategy in RSRM as most of the respondents strongly agreed with this statement.Market skimming has been used as pricing strategy in RSRM, majority of employees are disagreed with this statement. So we can say Market skimming has not been used as pricing strategy in RSRM Segmented pricing has been used for products in RSRM as majority of respondents are strongly agreed with this statement. RSRM is covering the major city areas as most of the employees are strongly agreed with this statement.

84Findings

RSRM covering the rural areas, most of the respondents strongly disagreed with this statement. So we can say RSRM is not covering the rural areas.By-products is being utilized as majority respondents are strongly agreed with this statement.The Sales promotion policy of RSRM is affected due to competitors Marketing strategy as majority of employees are strongly agreed to this statement. Profit margin sometimes can be compromised to maintain competitive price as majority of employees are strongly agreed to this statement. .The promotional schemes of RSRM stimulate the products demand as majority respondents are strongly agreed with this statement.

85Contd..

We can recommend RSRM to use Market skimming as pricing strategy for someparticular products as competitors are using this pricing strategy. They useMarket penetration as pricing strategy and also they do segmented pricing forsome specific products.We have find out that RSRM only focus on major city areas. They are coveringthe major city areas. But not focusing on rural areas. So we can recommend RSRM should focus on covering the rural areas by promoting their products in rural areas.We can suggest RSRM to increase their promotional quality and quantity as well.As the competitors of RSRM are very good in promotional activity. Also RSRMdo not focuses on TV promotions. So they should increase their TV promotionsand other promotional activities also.

86Recommendation

Establish and growing industryIn 1990s actual development beganDemand of steel is growingRSRM covers 20% of the total steel marketIncreasing their production from 8, 00,000 to 10, 00,000 M TonsPromotion strategy is not that much innovative or new

87Conclusion

88Do You Have Any Question???

89Thank You All

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