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Analysis Bargaining Electric power Of Buyers Business Essay

  1. Political
  2. Economic
  3. Social
  4. Technology
  1. Threat of New Entrants
  2. PEST
  3. Political
  4. Economic
  5. Social
  6. Technology
  7. Template for Risk of Substitutes
  8. PEST
  9. Political
  10. Economic
  11. Social
  12. Technological
  13. Overall Picture of Risk of Substitutes
  14. Bargaining Electric power of Suppliers
  15. Template for Bargaining Vitality of Supplier
  16. PEST
  17. Political
  18. Economic
  19. Social
  20. Technological
  21. Rivalry among Competitors
  22. Economic
  23. Social
  24. Technological
  25. Overall Picture of RivalryOpportunities and Threats
  26. EFE Matrix
  27. Competitive Profile Matrix -CPM
  28. a. Value Chain Analysis
  29. Primary Activities:
  30. Inbound Activities:
  31. Operations:
  32. Casting and Drying
  33. Glazing
  34. Firing
  35. Outbound Activities:
  36. Marketing and Sales:
  37. Supporting Activities:
  38. National Tiles - HQ, Manufacturer and Showrooms:
  39. Material Procurement - Local and Imported:
  40. Use Of Technology:
  41. Management and Employees - building a strategic asset:
  42. c. Tendency of Key Financial Ratios
  44. Current Proportion:
  45. Quick Ratio:
  47. Gross Income:
  48. Operating Profit:
  49. Net Profit Margin:
  50. Return on Advantage:
  52. Debt Percentage:
  53. Times Interest Won:
  55. Inventory Turnover:
  56. Total Asset START:
  58. Return on Equity:
  59. d. Strategic Cost Management Operations:
  60. Strengths and Weaknesses
  61. Strengths
  62. Weaknesses
  63. IFE Matrix:
  64. Competitors:
  65. Fred David's Suggestions/Matching/Decision Model
  66. Tows Matrix:
  67. S-O Strategies
  68. W-O Strategies
  87. S-T Strategies
  88. W-T Strategies
  116. Space Matrix:
  121. BCG Matrix:
  122. Internal External Matrix (IE)
  123. Quantitative Strategic Planning Matrix (QSPM)
  125. Price
  126. Easy Installation
  127. Product Quality
  128. Sizes
  129. Eliminate:
  130. Reduce:
  131. Raise:
  132. Create:
  133. People Proposition:
  134. Eliminate:
  135. Reduce:
  136. Raise:
  137. Create:
  138. Profit
  139. Raise:
  141. Cognitive Hurdles
  142. Motivational Hurdles
  143. Resource hurdles
  144. Balanced Business Scorecard
  146. Objectives:
  147. Measures:
  148. Targets:
  149. Initiatives:
  150. Objectives
  151. Measures
  152. Targets
  153. Initiatives
  154. Customer
  155. Financial Perspective
  156. Internal Perspective (Value Chain)
  157. Learning Organization

Tile industry in Pakistan has 4-5 major players namely Shabbir Tiles, Get better at Tiles, Karam Tiles and Country wide Tiles. The marketplace comprises of urbanized and semi-urbanized people which is huge market for these players to focus on. The GDP development rate nonetheless it is not appreciable but it suggest that the market will further increase by the GDP progress rate. With the presence of this huge market every company in the tile industry large number of customers.

Tile industry is also speedily acquiring the marble floor users because marble-tiled floor surfaces require polishing in the facility where they are places which is additional expense that marble floor requires over tile floor. Although comparing marble tile regarding quality and operation it enjoys the benefits that include strength, looks, hardness, higher abrasion resistance and better water amount of resistance than other tiles no matter how hard a tile is.

Tiles as something would lay in the high involvement consumer buying tendencies because buyers need a lot of information as they are not in a habit to buy it as the need arises whenever a new dwelling or office is built or the old tiles want an extended life are actually in a terrible order and must be replaced. Clients are well aware that they have to decide after careful and keen selection which is excatly why their patterns is variety seeking.

Price except for luxury product matters atlanta divorce attorneys product, but as the buying tendencies is not of recurrent in character and the buyers are not up to date about the price change occurring on the market therefore the market is not price sensitive

Marketing work in the Tile industry are not up to the mark and most of the companies are only offering their products on corporate and business branding basis. But their commercial brand image is strong enough to plainly differentiate itself with others.

Since the tile market includes urbanized and semi urbanized populace of the country it can be assumed that the customers are profitable.

All these factors make bargaining power of potential buyers extremely low. This can be explained by using Template on Bargaining Power of potential buyers which practices next. Template on Bargaining Ability of BuyerEffect of Macro Environment on Bargaining Electric power of Clients - Infestations Effect


No noticeable affect


Due to increase digit inflation in the country there has been a huge effect on the demand of the every product other consumer packed goods. Ceramic tiles industry dependent on construction industry is also a victim of the high inflation in the united states and their demand has also declined to some extent. This fact is evident from days gone by trend that it can be detected that demand is becoming comparatively slower when compared with prior years. Since almost all of the tiles customers are establishments, the downturn has led the pattern of structure downwards. Hence the clients are negatively affected by this monetary condition.


Social Fads favors the industry as the population of the united states is mainly position conscious and are worried with the materials benefits greatly. Since Tiles as a trend is in the emphasis the buyers haven't any choice rather than to go with the trend and this benefits the Tiles industry generally.


The customer needs the companies in the industry to provide them with the latest designs, colors and habits for better client satisfaction which requires the most advanced technology to keep them updated with the fads. There are imported tiles in the market which give buyers a variety to choose which somewhat escalates the bargaining ability of purchasers.

Threat of New Entrants

The Fixed cost in the Tile Industry accounts for 50%-80% of the full total Cost. Per device cost declines with every additional unit produced. Economies of level production can significantly profit in cost cutting down and this clarifies that large businesses have a cost advantage.

There is huge probable on the market for marketing initiatives. It has additionally mentioned earlier that the firms existing on the market are merely taking advantage of corporate and business brand image and there is absolutely no initiatives done to create brands for different tile products or its variants. Nevertheless the existing commercial image also differentiates companies with one another but with product branding or product variations branding companies can command prime and can increase customer life-time equity.

Every industry has its dynamics. Some market sectors are capital extensive and some aren't. Some market sectors are labor extensive and for a few industries to success are reliant on continuous technological change. Tile Industry is not capital intensive nor requires hi-fi technology. In Pakistan very little automation is done in this industry and the startup cost is for the Tile industry is also not quite high.

Serviceable Equipment is expensive because because of the political situation in Pakistan Herb and Equipment providers aren't willing to come to provide after sales services, even they are really reluctant to come for installation of the Plant and machinery.

Since the marketplace is big enough and there is a potential that newbies can be accommodated there will be no retaliation from the prevailing players towards the new entrants and there will be no hurdles to secure distribution channels or sources of source new entrant may well not face any difficulty stepping into the industry.



No restrictions consequently are imposed by the government on the ceramic manufacturers but the regular inspection and interference by the federal government representatives on the techniques of the firms is an obstacle for the manufacturers. Hence, the newbies to the industry will face pointless interference by the federal government.

There no such product variations in this industry and relatively, they will not have many problems in obtaining skilled people, materials or equipment. Hence, there will never be any legal barriers at the time of entry but administration inspection is a task for the newbies.


Increasing inflation and increasing fuel cost in the united states greatly impacts the Tiles Industry. Gas Cost comprises of major proportion in the total cost of production of Tiles which is why it has a direct effect on overall cost of creation and this factor is not only vulnerable for the existing players but also potential blockage for new comers. The magnitude factor can't be insignificant or of low importance.


Growing society and increasing transfer towards urbanization makes the industry potentially attractive and there are not much competition in the industry so interpersonal factor is tugging Threat of New Entrants towards high nevertheless the magnitude of pull impact towards high can't be higher because lower competition are not only factors to stimulate New Accessibility.


There is a sluggish growth in the technology required for the creation of ceramic products. The technology of new, better and higher profitable capacities of new machines tend to create unconventional obstacles but being truly a labor intensive industry it is gradual paced. These are unskilled and not readily accepting the new handling techniques and coding logics.

The industry in matter is the Ceramic Tiles Industry. Buyer has variety of substitutes available that include marble tiles, granite tiles and mosaic (out dated). Marble floors and Granite floor are better alternates to Tiles (ceramics) and they're also expensive than Ceramics Tiles. Marble floor is durable and likes appearance as well but it needs to be polished with in the service where they need to be floored, but it is better alternate in performance in functionality than Tiles on the attribute including: low or no drinking water absorbing and has low scratching rate. Granite Tiles are also a good alternative however they is also expensive than Ceramic Tiles plus they more talk about other dynamics of marble tiles.

These substitutes are real and buyers can swap them with ceramic Tiles nonetheless it in addition has been noticed that trend is towards ceramic tiles and people are moving away from marble and granite flooring. This analysis demonstrates threat of substitute is high. It can also explain by using Template.

Template for Risk of Substitutes



No visible affect


Inflation and lower GDP progress rates show that prices of the alternates matter. This benefits the cheaper alternate which is ceramic tiles. Ceramic Tiles cost smaller than marble and granite and another important point is the fact Ceramic Tiles do not require polishing.


Nowadays aesthetics have become vitally important for the customers. They demand for designs and convenience in maintenance of their floor. Ceramic Tiles are comparatively cheaper and easy to keep up than Marble and Granite. Granites and marble both are well liked by clients on the foundation aesthetics as the appearance are natural however tiles are also aesthetically designed and are no less than in aesthetics with their comparable alternates. There is also a move from marble tiles to ceramic tiles as well which means magnitude of this force is suprisingly low on the low side


With the constant growth in technology, new methods and equipments are being introduced in ceramic production. Hence, the business needs to upgrade based on the trends in the industry keeping in view both local and international marketplaces.





Low Medium High

Overall Picture of Risk of Substitutes

L(1) M H(10)

Bargaining Electric power of Suppliers

The Inputs necessary for ceramic tiles manufacturing include clay and chemicals. These inputs are of standard quality in aspect. National Tiles are also using standard inputs. A couple of no problems in procurement of these inputs, a whole lot of potential suppliers can be found and suppliers can be switched easily. THE TYPE input suppliers is such that these are doing their businesses on short to medium range and this clarifies that suppliers aren't in a position to enter the Tile Industry's business. For these suppliers, the firms in the Tile Industry are their important customers because there are not many companies in the Tile Industry, scarcely 5-6 major players, this makes customer basic scarce for the suppliers. The suppliers have to keep good relations with these companies in order to stay profitable.

Costs of Buys of the inputs are relatively a small portion of the entire cost as the major part of the cost is on overheads which include consumption vitality and gas. This all amounts up and the research means that the bargaining electric power of suppliers is low.

Template for Bargaining Vitality of Supplier



The rules and order situation in the united states is problems for the suppliers as companies acquire the raw material from mines in the northern areas of the united states. The unstable political conditions become a barrier for the suppliers to supply the manufacturers with organic material on time and in proper condition.


Inflation could cause upsurge in cost of uncooked materials, but there are not a lot of companies on the market therefore the suppliers have a minimal bargaining vitality as the price of purchase will not merely will depend on the raw materials but even other overheads which form a constituent portion of the cost of material in production tiles and ceramics.


No obvious affect


No visible affect

Rivalry among Competitors

Tile industry expansion is associated with the building industry. GDP progress rate can give an idea about the progress rate of any industry in an economy of any country. Because the GDP progress rate before oscillated around only 2. 5-3%, the development of Tile Industry cannot be rapid because the industry itself is within the early stage of maturity.

It in addition has been stated recently that fixed costs in industry is just about 50-80% so it protects the major part of the total cost. Product dissimilarities are significant in the Tile industry. National Tiles are known for their durable tiles best suited for the industrial sector of the industry whereas Professional Tiles are popular because of their visual quality.

National Tiles Small targets one attribute and particular in it which is strength and hardness whereas other players of the industry are well diversified.

Alternates to Tiles (ceramics) are costly and they additionally require other cost to be incurred like marble requires polishing so there exists presence of turning cost.

The opponents are of much bigger size than National Tiles. Country wide Tiles creation is 2000 meters per day whereas all the other competitors are producing within the number of 15000-2000 meters each day which is many times higher than the production of National Tiles. One reason of National Tiles having low creation output but still undertaking well on the industry is the fact the customers of Country wide Tiles are Industrial and Commercial Users whereas the customers of the rivals are mainly domestic users.


Most of the international companies are not eager to make investment in Pakistan due to the law and order situation in the country. This inversely damaged the businesses in the country but at the same time it is opportunity for the neighborhood manufacturers to flourish as they van expect that they are not going to have competition from a Global Company coming to Pakistan,


People are seeking looks in the tiles and the companies that are proficient at planning the Tile can save themselves from the rivalry from the challengers.


The industry is labor intense more than capital rigorous. With huge and modern technology, companies on the market can compete on the basis of modernized technology where they have invested but a huge portion of manufacturing tiles depend on the number of labor. Therefore more than technology, the industry would depend on the labor efficiency.

Overall Picture of RivalryOpportunities and Threats



Declining rural populace due to better living conditions, however 63. 8% of Pakistan's inhabitants still lives in rural areas which remains an un-tapped market

Supply of electricity and gas stay the main element cost- related conditions that impact the industry

Low rivalry among rivals in professional tile sector

No bonuses from the federal government to boost competitiveness of the industry i. e. , tax-free zones, subsidy, and ongoing power etc.

Abundant option of cheap labor (15. 6% of total labor force has key education only)

Due to lower import tariffs, local providers have found it difficult to compete with Chinese tile imports

Demand growing for different designs and variety in tiles by individuals who are in the group of upper midsection & upper income group

T he tile industry is highly reliant on the engineering industry which means dynamics of building industry also results Tile Industry

Large surplus capacities in the international markets

EFE Matrix

Competitive Profile Matrix -CPM

a. Value Chain Analysis

Primary Activities:

Inbound Activities:

About 60% source materials are made by National Tiles itself which includes ceramic colors and other materials while 40% type materials for creation tiles are ordered from 'Mian-Waali' and 'Saree' region of Pakistan which includes minerals (chemicals) and clay. The company is not heavily relying on its suppliers to provide them the complete material somewhat it prefers to have moderate vertical integration which is a competitive edge for the company.


The Operational activities of National Tiles Limited are aligned with the product quality conformance. German technology can be used along the way of making tiles which ensures the standards conformance of the Tile. Flower in Nooriabad functions with the capacity of 2000 meter per day, currently company packages to increase its production capacity from 2000 to 4000 meter per day, for which they can be setting up another plant.

The Procedure for Developing tiles at NTCL consist of following activities:

For the slide preparation the raw materials are confusing with water according to the necessity. Proper composition along with the sufficient amount of drinking water then gets packed to the all mills for grinding

Casting and Drying

Slip is cast into plaster moulds, anticipated to absorption of drinking water the surface becomes thick with time then your tiles are dried to a minimal drinking water content to increase the durability of body, which is called drying.


Then tile is brought for glazing that involves smoothing the top of tile to provide it a glassy shape.


Then the tile is helped bring for firing in kiln, consequently the bodies will need place some physical and chemical reactions, and will take a set shape.

As your final step, NTCL inspect the done products to check its conformance to the quality and then sent for final packaging, in case a big portion of tile has gone out of requirements, the tile is repaired and re-fired.

Outbound Activities:

About 90% syndication is done by Country wide tiles itself, and they are engaged in forwards integration that doesn't make them rely on others to distribute their product, in simple fact national tiles is convinced they are successful than others in syndication area since it is well designed by their expert people which doesn't leave any major weakness that may cause delay in availability of the product to the customers. Since establishments are their main customers whom they immediately provide you with the tiles at where the tile is required to be floored. The major part of their sales is within Karachi so syndication is not so wide since most of the market sectors are found in Karachi while they also source tiles to the industries in Punjab mainly in Faisalabad.

Marketing and Sales:

Marketing is performed mainly through Personal Marriage (PR) and company contacts. This is necessary as 90% of the sales are done straight through the business showrooms, only about 10% of the sales are through the involvements of intermediaries or sellers. The company has developed good PR romantic relationship overtime with the customers and potential customers. National Tiles Small is not engaged other marketing activities but nonetheless the organization image has received good name and goodwill for the company.

With the assistance of the sales team of the business the company has negotiated and authorized a contract with Pakistan State Oil for decorating all the petrol channels' floors with National Tiles. Secondly the company has been able to successfully execute the agreement with CDGK to enhance Karachi city. For this function Country wide Tiles were used at the beach remove pavements and resting areas at Sea View as well to decorate the underpass at Clifton.

Supporting Activities:

National Tiles - HQ, Manufacturer and Showrooms:

NTCL is a open public limited company and the sole manufacturer of Extruded Vitrified Split Tiles. The company factory can be found 80 km from net near Nooriabad rendering it much easier to procure and move the required organic materials. And yes it provides the chance of extension if required in future as this area has many empty plots still available.

NTCL has strategically placed its hq at 8th floor, Al-Sehat Middle, Annexe Regent Plaza Hotel, Rafiqui Shaheed Street, Karachi. This can help those to be situated at a place which is easily reachable. Furthermore, being close to a luxury hotel helps it be easier to meet technological experts from in another country.

The company has more than 80 sellers who take care of the sales and circulation of tiles throughout the country. Because the sales work are done immediately by the company, to cater to this goal they have established showrooms in all the major towns like Karachi, Faisalabad, Lahore, etc. These office buildings showcase all the product examples, color catalogues and designs for the customers to see, choose and order from.

The company has 6 national offices in Lahore, Islamabad, Peshawar, Faisalabad, Multan and Hyderabad to help sales throughout Pakistan. Their main sales and screen center for Karachi city is within saddar behind Hotel Metropole while sales electric outlet is at Golimar, Ghousia Colony.

Management at National Tiles has programs to appoint sellers in international market like Gulf Areas, Singapore, Malaysia & Bangladesh and other such areas. At this time these are exporting split tiles to UAE through direct selling for specific tasks, however the quantity is very low.

Material Procurement - Local and Imported:

NTCL procures 40% of raw material from the local market as the remaining 60% of uncooked material is made by them at their manufacturer plant through crushing of stones. They buy 'clay', which is one of the main components for the tile body, from Mianwaali and Saree.

Previously the company used to buy chemicals and dyes from brought in chemicals' market in sadder. The suppliers till present continue to be unfixed as the chemicals are procured from suppliers in the wild market.

Next they might test them in their laboratories before consumption in their creation process. This was done in order to check if the chemicals are of the same steadiness and purity levels or not as is necessary by the tile method they put into action.

Presently the business's R&D has made them self sufficient in dye development. It has also helped in minimizing the procurement cost as the dyes were an expensive material scheduled to import duties, etc.

At the time of company's starting years roughly 80% of the full total materials used to be imported, nevertheless the company has advanced and helped bring this figure right down to about 20% of total material procurement.

Use Of Technology:

National Tiles will be the sole individual of German technology in their manufacturing plant in Nooriabad. They began their operation with the technological collaboration of M/s. Agrob Anlagenbau GmbH, Germany. They have best machineries from China and Germany to crush stones to make dust particles and clay. They have plans to determine another flower with automatic machineries. For technological assistance they have got local engineers who've skills to utilize heavy machineries operated in NTCL.

Another facet of scientific development at Country wide Tiles is the usage of Break up Technology for the tile creation. This enables the development of two tiles in the main one cycle thus reducing the price of separate production.

Furthermore, the business under consideration is the only one in Pakistan to make vitrified tiles which support harsh climate and a great many other tests of scratching and durability. That is made possible through firing them at very high temperature (approximately 1180oC) in a 'kiln' which is handled a day.

Management and Employees - building a strategic asset:

National Tiles retains stringent plan to recruit new employees. The recruitment and selection process is applied internally. New selection for vacant position is performed after interviews and inspection of previous experience as well as educational records.

The total labor force appointed by the company is about 300 people. Out of this total, about 200 employees are given to the manufacturer and the production process while 80 employees are categorized as the top of marketing and sales. All the employees are professionally trained as per the business requirements.

Executive Management of NTCL comprises of:

Agha Tajammul Hussain (Chairman & Managing Director)

Agha Tahir Hussain (Deputy Manageing Director)

Agha Babar Hussain (Director Creation)

Agha Afsar Hussaib (Director)

Agha Athar Hussain (Director)

Mrs. Niaz Fatima (Director)

Mrs. Shafiq Fatima (Director)

Agha Mustafa Hussain (Director Sales & Managing)

Agha Murtaza Hussain (Director)

c. Tendency of Key Financial Ratios

Financial Ratio Procedures the financial health of a company and provides an instant picture of firm's advantages and weaknesses lied in operating, investing and funding activities. These financial signals are very helpful while formulating the strategy.

NTCL's budget and performance is very unusual as suggested by each percentage in each year because the tendency of virtually all ratios is not constant in all 3 years.


Current Proportion:

Company's capacity to meet up with the short term obligations is declining over the last 3 years, which is negative sign for the company's short term collectors; company is consistently dropping short of liquid asset to pay the total amount scheduled from the creditors which might cause company to lose its short term credit borrowing for its operating activities.

Quick Ratio:

In calendar year 2008, company is having only 30% of the easily cash convertible belongings to pay the liabilities that are almost three times of the most liquid possessions this capacity further falls in calendar year 2009 and recovering marginally this year 2010. The difference between quick and current ratios implies that in year 2009 and 2010 the business is keeping satisfactory inventory which is not said to be easily cash convertible this might cause uneasy sense to short-term collectors/supplier to provide material to the business on credit.


Gross Income:

Gross profit margin shows that normally 82% is the expense of goods sold over the time of 3 years, gross margins of the business are incredibly inconsistence scheduled to slight drop in the sales and minor upsurge in cost of goods sold that demonstrates declining efficiency in the operational cost management.

Operating Profit:

For first 2 yrs the operating margin is having increasing trend that shows the organization can reduce its operating activities expenditures but margins applies to very down in the 2010 that presents inconsistency in handling operating activities expenditures.

Net Profit Margin:

As in comparison to last two years 2008 and 2009, margins have declined this year 2010 due decrease in the sales of the business that declined the web profit margins that have been increased in last year.

Return on Advantage:

Assets committed to the company are not getting up to the mark return except a little return in 2009 2009 and again drop in 2010 2010.

Overall profitability ratios are marginally affected by declining this year 2010 after some increase in 2009 as compared to 2008.


Debt Percentage:

Due to heavy loss in past years company has substantial accumulated losses in 2008, that could cause company to lose its collateral which made them to go to get more long term credit debt in calendar year 2009 and 2010, and relating to company's insurance policy directors can invest in giving interest free unprotected loan to company in case there is any crises so that company shouldn't be flunk of funds for just about any expansion.

Times Interest Won:

The company's capacity to pay interest from its EBIT has increased in time 2009 the proportion raises because of upsurge in the sales that increased EBIT but this ratio goes down again in 2010 2010 anticipated to drop in sales thus this inconsistency would give red indication to external debt holders (apart from directors of company) to avoid financing money to the business.


Inventory Turnover:

On average company can convert inventory into sales 1. 94 times in a time in 2008 which trend is pretty much preserved in next two years 2009 and 2010 this performance very gradual but consistent over 3 years.

Total Asset START:

On average in every 3 years the assets make about a fifty percent unit sales per unit and this development is declining over previous three years which indicated the inefficiency of property to generate sensible per unit sales.


Due to little bit of income in 2008 EPS is below average but it offers improved in '09 2009 due to increased sales and increase profitability but EPS falls again in 2010 2010 which is unattractive for an collateral investor to invest in NTCL.

Return on Equity:

Though company possessed some profits in all 3 years but their equity turned into negative due to heavy gathered losses from previous years which will make go back n equity negative in every 3 years but it tends to come in positive credited to profit generation in last three years and expected earnings generation in approaching years too.

d. Strategic Cost Management Operations:

Cost management has become a critical success skill for most firms in today's highly competitive environment. Nonetheless it is not sufficient to simply keep your charges down. Instead, costs must be managed strategically. Strategic cost management is the application of cost management techniques so that they simultaneously enhance the tactical position of a firm and result in reduced costs.

Though NTCL follows traditional cost accounting techniques to manage cost like other companies in the industry that determine the cost. Comparing those with the standards to determine variance and taking actions to reduce variances. Yet somewhat NTCL is involved in proper cost management by focusing on the price tag on each value string factor. Mainly their operations derive the major cost section, which is approximately 60% of the total cost. The business needs to manage it effectively. The breakdown of their operations cost is: Uncooked material is about 10-15%, labour about 20%, other over minds 10% but energy and gas cost is the major chunk of their total functions cost which is approximately 55%, anticipated to high cost involved in the businesses company has implemented following process to lessen some of the aforementioned costs, and prevent other new costs.

The company uses split technology in its operations where two tiles are produced in one cycle that reduces the cost. Moreover, they have stand by system of electricity to avoid suspension of production in case there is any major breakdown of electricity that could cause stoppage of creation that increases the idle time of labor, and idle of your energy of machinery, wait in promptly delivery of purchases to the clients. To avoid low quality and defect costs, the company follows elimination cost measures whose cost is less than what it costs in poor quality and defects insurance firms quality planning, Quality improvement team conferences, quality education and training, process capability evaluation. Company can control over cost somewhat but it hasn't achieved its full objectives of lowering cost and bettering efficiency as shown in company proportion trends in success ratios which can be inconsistent due to cost of sales up and downs. Though company has proper cost management process but the condition lies in execution of process.

Strengths and Weaknesses



Competitive Sales Force

Company's liquidity condition is weak

90% of the circulation is handled directly by the business.

Low marketing work to promote product.

R & D Team Develops Dyes itself which will save you the high importing cost.

Not much importance directed at brand building.

Monopoly of providing tiles to the industrial sector.

Lack of complex skills in labor.

Acid & Alkaline facts tiles with low abrasion.

Very low development of 2000 meter / day.

Sole consumer of German Technology for manufacturing.

Usage for decorating forward elevation as tiles do not show up off

IFE Matrix:


National Tiles and Ceramics Small (NTCL) offers Tiles that are mainly made to suit Stock/Industry architecture needs. That is also stated before that the business is after the portion of Industrial consumers who wish to install tiles to become at par with the quality standards so that they can attract international customers and traders for themselves. Their main concerns are that the tile should be durable, alkaline and HCL facts, water and substance proof. They may be least concerned with the variety of colors, design or other aesthetics of the tiles. Keeping all this in view Country wide Tiles is the one company that suits all such requirement and this is the reason why we characterized their strategy as Emphasis Differentiation. Because of this a diagrammatic presentations is really as follow:

National Tiles is in the fourth quadrant and the company loves a monopoly situation there. Being in the fourth quadrant National Tiles have made the Industry structure more appealing for themselves as the potential buyers are not the same as the other industry players aren't focusing to this segment by themselves. Their source of clay from suppliers are specific and since they are the only customers for the kind of clay which suits the high temperature, the supplier electricity over them is zero as there is no other player requiring that clay. Being in the fourth quadrant they haven't any direct competitor so rivalry has further been down.

Competitors including Shabbir Tiles, Master Tiles and Karam Tiles are differentiating their products to serve the vast audience which is the home segment. Residential portion is significantly bigger than the Industrial sector. All are not specialized in a single kind of Tile offering nonetheless they are quite diversified. Shabbir and Professional Tiles not only offer beautiful ceramic tiles but also offer porcelain and granite Tiles. Porcelain tiles are equally abrasion resilient than then the National Tile's Industrial Tile offering but porcelain is an expensive alternate. Karam ceramics Small as the name suggest also offers other ceramic products and variety of bed room, bathroom room, kitchen and drawing and dining area tiles. This is why that all of them are positioned in the same quadrant that is Broad Differentiation.

Fred David's Suggestions/Matching/Decision Model

Tows Matrix:

S-O Strategies

W-O Strategies


Initiate operations and offer in untapped areas (S1, S2, O1)


Efforts can be made to brand the tiles which can create huge earnings (W2, W3, O4)


Company should bring in new range of tiles in colors and designs to cater to family members sector (S1, S3, O4)


Provide basic specialized training to unskilled personnel (W4, O3)


Company can introduce customization in thickness of tile to provide the needs of professional customers accordingly (S1, S6, O2, )


Increase creation to focus on increasing needs (W5, O3, O4)


Spend to boost understanding on tile feature which are essential for industrial sector (S1, S4, S5, O2)



Build on brand & marketing expenditure for tile consumption on front side elevation of homes and offices, havelis, etc. (O1, O4)


















S-T Strategies

W-T Strategies


Company can go for backward integration and find suppliers of fresh material - clay and mitti (T1, T2, S3)


Negotiate with administration to increase import tariffs on international tile products (T3)




Initiate activities to construct brand with available money to set-up branding obstacles for new entrants (W3, T5)


























Space Matrix:


The Financial Durability of the business is in an exceedingly weak position. The business did not go through operational losses however the profit after tax is also not commendable. Shareholders Equity has been flipped negative due to heavy losses suffered by the business in the previous years which includes made Go back on Collateral also negative. Negative go back on equity reveals that it is not in a safe position. Current Proportion, which determines the short-term debt paying potential, is also in a terrible position. Current ratio is calculated by dividing current property over current liabilities. National Tiles current proportion for the years 2008-2010 is less than one, which signifies there aren't adequate current resources available to meet up the short term claims of suppliers and lenders.

Inventory turnover is also low. In 2010 2010, Inventory turnover was 2 times. Which means that inventory provided to the market only required two times to be restocked again, however because of the character of product it cannot be 7-8 times that marketplaces wants inventory to be restocked but maybe it's around 4-5 times however in the situation of National Tiles the client they are targeting is mainly Establishments, the percentage is poor but justified. Return on Total Resources remained positive during 2008-2010 however the lower rate of come back is also very poor performance indicator of the business. Operating earnings is also not in a good position that leads it into the worst part in the area Matrix presented after the description of the other factors.


In the Ceramic Tiles Industry, there are no significant obstacles which can limit the access of potential rivals and this has also been explained on the market Analysis presented in the last part of the record. Technology in the production of Tiles hasn't drastically evolved and the automation on the market is also not so high, but the Technology used by Country wide Tiles Ceramics Limited is quite old which also results in high fuel and gas consumption as the place is not cost effective, keeping this because further Technological changes can have unfavorable effect on Country wide Tiles. Rate of Inflation in the united states has long migrated to increase digit body of 10% CPI. The type of product is in a way that price changes have not much impact on demand; it may be possible that the ingestion may increase a little in the ongoing building and development in the united states, if the prices will go down, but it cannot induce more ingestion because other monetary factors (GDP rate, inflation, unemployment etc) have more impact on demand than simply price.


Market show of Country wide Tiles is suprisingly low. Matching to company standard, production convenience of National Tiles is 2000 meters per day whereas competitor's creation capacity on an estimate basis amounts between 15, 000-20, 000 meters per day. This information may be used to depict market show of National Tiles.

Product Quality of Country wide Tiles is superior as it complements with needs of its Industrial customer. The features of the merchandise are hardness, durability, Alkaline and HCL, confirmation and water absorption resistant. The product has been sold to the clients through effective PR with clients so overall customer romantic relationship of the company is also good. Country wide Tiles has flower which is not up-to-date but scheduled to technical know-how they have got been able to make dyes plus some chemicals that experience as raw materials suggestions in the development of Tiles. Company has onward integration i. e. 90% of the distribution is done by the business's authorized sales shops and it has been explained in the Industry Analysis that provider power over the companies in Tile industry is none.


Industry has development potential because people are leaving alternates like marble and mosaic towards Ceramic Tiles and urbanization rate in metropolitan towns of Pakistan increasing. On aggregate basis there is not much branding done so with branding and other marketing and quality improvement initiatives the industry profit potential may increase. Resources and creation capacity are well utilized in the industry which can be attributed to the actual fact that the total creation or capacity utilization of the companies' suits with the demand for tiles as there isn't much competition on the market.

BCG Matrix:

Internal External Matrix (IE)

National Tiles comes in the fifth cell which represents HOLD AND KEEP MAINTAINING strategy. It denotes that the National Tiles is a reasonably stable firm that is continuing to build after its advantages, along with working well to use advantage of most of the opportunities that arise and prevent the threats that exist in the external environment.

The company is a strong position internally as well as externally, which explains why the best technique for it might be to support this position on the market. This involves the formulation of intense strategies like market penetration, and/or product development. Therefore Country wide Tiles should give attention to these strategies and determine which is most appropriate to adopt. Grand Strategy Matrix:

Upon evaluating National Tiles on competitive position and market (industry) growth, we see that this falls in to the first quadrant meaning it is within an excellent strategic position. For National Tiles, market penetration, market development, and product development would be appropriate strategies to adopt.

Since it already has a well-established competitive edge in the tile industry and there is high potential, therefore National Tiles should present new range of tiles in colors and designs to focus on the household sector, and it should initiate operations and offer of tiles in the untapped rural areas of the country. The business can also build upon its competitive edge by branding its product and distributing awareness to the through promotion.

Quantitative Strategic Planning Matrix (QSPM)

Develop home tiles by adding type of home tiles which involves making tiles with different designs with cosmetic and colors, since consumer tiles have a good prospect of growth since everyone desires tile in their homes as the living standard of men and women have raised over the past years. They spend more on furnishing their homes with various things in which floor coverings their homes with tiles is also included. Fast urbanization is also a encouraging factor for developing a new product to serve homes, since fast urbanization escalates the building activities thus escalates the potential for home tiles. International market players are having surplus capacity plus they may bite the top chunk of Pakistani Market talk about by getting into Pakistan since China is already increasing its export to Pakistan. To cater to this competition, it is the need of the hour to build up the product that provides more than what a global player offers to customers in Pakistan.

Since company has an edge of having German technology, which can be improved for consumer tiles development without purchasing new equipment that will minimize the cost to acquire the new machinery company can avail this possibility to develop the product and show the sources of industrial tile portion. Company's ability to have Acidity & Alkaline facts tiles with low abrasion can even be shifted to home tiles that may also create a fresh strength for an organization to compete grasp tiles, shabbier tiles and karam tiles in home tile portion and it will help the business to increase its market share in tile industry.



National Tiles with Divide Technology produces two tiles in a single cycle thereby which makes it possible to market them at an inexpensive attractive price. With superior quality and looks, others like Shabbir Tiles and Grasp Tiles offer higher prices. However, Country wide tiles mostly focus on the commercial sector making personalized tiles of 15mm thickness as required by the factories, thus they could charge a higher price from their commercial clients, thus placing them at a location higher than its competitors on the canvas.

Easy Installation

Shabbir Tiles were the first one to introduce installation materials in Pakistan and revise their equipments. Following them is the performance of Professional and Karam. National Tiles rank least expensive in performance upon this aspect as the tiles require special bonds anchored installation.

Product Quality

National tiles are corrosion and scratching resistant. Because they are typically used outdoor they have got sun fast colors and weatherproof. Karam, Shabbir and Master tiles are equally good when it comes to quality and standard and needs to be polished to keep up the shine and look of the tiles. Furthermore, if installed at a location with direct exposure to sun will result in faded colors and chipping of tiles. However, this isn't the truth with national tiles, thus making them superior in quality.


Tiles are available in various sizes by all these companies. It starts from 8x8 to different sizes for floors and wall space. Shabbir Tiles was the pioneers of large size ceramic tiles in Pakistan and provide an array of sizes for inside and outdoor tiles. However, now all the companies are providing tiles in multiple sizes. National tiles get ranking lowest because they offer relatively reduced size variety, justified as they cater generally to the professional sector.


The company should completely eliminate wrong delivery purchases completely. This will likely ensure that the customers' devotion rises. Because of this they will require to have a strong communication between your showrooms, ordering-taking office, factory and travelling department. Furthermore, they will have to be vigilant over the quantity of inventory they are simply keeping accessible. Also, if one showroom comes less than inventory, strong communication will help covering the lack through immediate supply form nearest location.


The company should reduce the overall circuit of product sales; starting from the order form and finishing at the delivery and inspection of the product. Usage of latest soft-wares available in the market for handling the entire order-delivery process can be utilized.


The company should raise three value offering features for the clients.

Brand name: National Tiles should work on making their name an icon of quality and uniqueness in the tile industry. This will make customers use their name with pride as 'brand names' are now a vector for calculating living position. Associating themselves with branding will help the business in harvesting to over-looked aspects and features.

Aesthetics: NTCL should further develop their product by nurturing the appearance in the tile offering. Increase should be made in color, designs and patterns.

Easy Unit installation: National tiles, presently rates lowest upon this value vector. Set up is the first point at which the client actually experiences the merchandise he has bought. You get highest points for providing the best first experience. NTCL should try to cash in on this aspect by giving easy installation. This may be done through mailing a company rep to guide the labor, etc.


These are three new value vectors which will help the business in creating an un-contested space and providing them with a sustainable competitive benefit over their opponents. They are:

Environment friendly recycled content: They can follow the latest trend of 'heading renewable' and making environment friendly products. Because of this they may use recycled material for the tile processing which is durable. This will save cost and present them a competitive gain over other tile manufacturers.

Tiles with Cloth Top: Currently tiles are being offered in different top surface finishes like glazed, unglazed, matte, porcelain style, etc. The company can bring in a fresh notion of tiles with textile top finish. This will likely be an attempt towards incorporating the carpet industry with the tile industry and creating an un-contested space.

Customization: Another creation vector can be customization of the tile. This is a combo of product and service. The business representative will provide consultancy services to your client to find the customized style, color, etc according to the theme of the area or area where the tile is likely to be installed. This can be workable as nowadays people are challenging adornment, theme, styles, etc when designing their homes or offices.

People Proposition:


Completely eliminate miscommunication amidst employees. This can help in achieving the rest of the value vectors described above. Furthermore it'll support in successful working of all the departments in the business as well.


Unhealthy conflicts which can result in disruptive habit should be reduced. This is done through listening to employees and making the business into a learning group.


Customer Support to Clients: Traders at the showroom and sales persons should improve their support services. This can be done in depth training the sales force for after sales services.

Hiring experienced labor: Matching to a Harvard professor's research, hiring experienced and talented labor at all levels in the business paves a smoother way towards company's success. The business should raise this aspect to assist in company attaining its objectives.


Technical knowledge of employees should be created as currently the technological knowledge is not at par with international standard. They are able to send their employees to international workout sessions or programs to learn skills required to achieve the new strategy.



Raise the automation levels through soft-wares as mentioned above. This will likely also assist in reaching the 'reduce' targets, thus giving n overall impact.

Create: Order Online: The Company should support online placing your order thus minimizing paperwork and time. Customers (especially from the present generation) will also feel convenience in the web ordering method. For this they ought to create an interactive website to give ease to customers


Obstacles are fastened with any action intend to develop product or in the benefits of new product. Based on the analysts there are usually four hurdles that come across during execution of new strategies and action projects in any corporation. Those hurdles are:

Cognitive Hurdles

Political Hurdles

Motivational Hurdles

Resources Hurdles

To overcome these hurdles, the business may use the newly investigated model of The Tipping Point Authority. This is quite the opposite of the traditional wisdom. Conventional intelligence only focuses on the mass of the business, majorly consisting of the employees of the business.

On the other hands tipping point strategically targets extremes; the individuals and their activities which have an effect over the company performance. Advantage of using tipping point is the fact it could be implemented without nurturing the price and the change is fast. You respond upon only over a few focused aspects and make faster results.

Cognitive Hurdles

Cognitive hurdles will be the blockage in employees knowing that their business requires a change. Most often companies, to awaken their employees, insist that company must attain superior results. However, this is not so easy to perform. To get the staff interest, change the frame of mind on must allow employees see and experience the need to change.

To triumph over the cognitive hurdle it is strongly recommended to let the staff know their most detrimental operational problems and dissatisfied customers. In nationwide tiles, to look at change and put into action the decided strategies, it is needed to give knowledge with their employees about the customer's feedback and other problems that have to be exercised by bringing out changes in process and products. But first and primary step would be to communicate the chosen strategy whatsoever levels.

Motivational Hurdles

Motivational hurdles, as the name implies, will be the hurdles to motivating employees in working with new strategy like strategies extracted from The Reconstructionist View. After the company senses the necessity to change within an organization, it becomes very very important to professionals to ensure that their workers proceed in a primary, significant and persistent manner. Extremely common that strategy fails because top employees didn't succeed in execution of strategy properly. The three focused factors of minimizing demonization are kingpins, fishbowl management and atomization.

At Country wide Tiles, the management can beat motivational hurdles through pursuing techniques:

Identify the kingpins within the factory workers and the sales teams. Involve and educate them about the new strategy. Provide him with the pathway to get that promotion which other employees detect for following. Including the kingpin is a certain supervisor of showroom to whom his team mates research to. Simple him about the merchandise development strategy and his position in the organization. Coach him for the execution of the new action plan, like convincing and negotiating orders with new customers

Another method can be the fishbowl. Because of this all the executives and professionals can be produced to sit in a single room to brainstorm actions, hurdles, constraints and issues which can occur during the implementation stage and then collaborating and recommending ways to solve them.

Resource hurdles

Resource hurdles are the obscurity that professionals faces while having changes with limited resources and time. It is presumed that company needs more resources to do greater switch in strategy. However, company hardly ever gets the resources they feel they had a need to get planned tactical results.

Research says that leaders that apply tipping point authority hardly ever need to spare their time for it to obtain extra source. In fact, they have already identified their chilly places (activities that greater resources source but low performance impact) and hotspots (activities that contain low resource input need but large expected results) in their companies.

In NTCL they have marketing and sales force who can make their cool and hot locations and arrange their efforts accordingly. These cold and hot spots can be the clientele. Also the business can control inventory by retaining an effective forecast system to avoid blocking their economic resources in overstocked inventory. Furthermore the company can work on the aspect that they are already implementing, that is, producing the recycleables themselves and also the chemicals required. This will save cost as well as will avoid the chance of running short of recycleables as well as fluctuation in its price.

Balanced Business Scorecard



If the business is to go after strategy of product development (advantages of fabric-layered tiles), its first goal should be to attract clients from family members sector, and wthhold the current ones. Because such tiles would typically be demanded by interior design companies and domestic sector as people could have much more variety in color, design and size to choose from when they enhance their homes. Also they might be widely used by companies in offices because they are durable and would give a more professional look in comparison to rugs. Besides, companies don't want to face the hassle of getting the carped cleansed or changed every week. Such tiles end up being more durable and worthwhile. To ensure awareness among the target market for these new tiles, the business would have to greatly give attention to and enhance their marketing and promotion activities.


The above goals could be assessed by the ratio upsurge in the sales of the business.


To capture 10 percent of the recently non-catered market (i. e. personal sector and business office buildings).


The Company would take the effort to start out customer awareness programs to clear any misconceptions they may have about the merchandise. For example; they might be made aware that the glue and chemicals found in the carpet tiles would be nontoxic, and would not be health harmful or donate to indoor air pollution.






To attract Clients for New Product (fabric layered tile)

Percentage of upsurge in Sales from the New Product

To catch 10% of the residential Tile market

Initiate a advertising campaign to create recognition about the new product

Financial Perspective

To liquidity (quick ratio) of the

Increased inventory turnover and increased quick ratio

To improve quick proportion from 0. 31 (2010) to 0. 5 of the full total current liabilities

Incentivize sales repetitions to increase sales.

Internal Perspective (Value Chain)

Integration of inner information systems

Reduced times in total period to complete order till delivery cycle

No more profits / complaints scheduled to incorrect orders

20% Decrease in Lead time

100% Removal of incorrect order deliveries

Implementation of ERP & SAP systems

Learning Organization

Strategies should be regular with the business objectives.

Individual employee participation and contribution

Proper two-way communication of strategies

Encourage reviews from employees

To generate creative New product ideas

Alternates generated

To have 1 product idea per employee per month

Enabling a Culture where everyone can get involved and contribute

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