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Value Chain PROCEDURE FOR Rak Ceramics Commerce Essay

This is an assigned job of the course "Business Strategy" the aim of which is to permit us to learn about the entire value chain process of a business. RAK ceramics is completely backward and forward integrated. This analysis is providing us with valuable functional knowledge about "business strategy" in respect to the worthiness string activities of RAK Ceramics as it is the market leader in ceramic business in Bangladesh at the moment.

Reason for choosing RAK Ceramics:

The reason behind choosing RAK Ceramics is to learn about value chain process of RAK ceramics which can provide us a functional overview of the whole value chain process.

Objective of the survey:

The main objective of the statement is explained below:

An over take on RAK Ceramics

Overall value string process of RAK Ceramics

Primary activities of RAK Ceramics (like starts off from supply string management to providing products to the end user)

Support activities of RAK Ceramics( like R&D, basic administration and individuals resource management)


The article only focuses on RAK ceramic's tiles production


The limitations receive below:

Information unavailability anticipated to confidentiality

Inconsistent information


The research strategy is given as followed:

Primary Data: Key data is collected by visiting RAK ceramics creation plant, interviewing office workers.

Secondary Data: Secondary data is accumulated at relevant websites and printed journals.

Company introduction:

RAK ceramics UAE:

RAK a worldwide ceramic multinational is in the Ras Al Khaimah. It really is a public shareholding company with H. H. Sheikh Saud Bin Saqr Al Qassimi. He is the Crown Prince & Deputy Ruler of Ras Al Khaimah as the Chairman and Dr. Khater Massaad as the Chief Executive Officer. They have worldwide sales of over USD one billion.

To build a world standard for quality and beauty, the business basically starts processing. They start their first development in 1991. Within 19 years it became a world class company.

2, 27, 000 sq meters of tiles and over 8500 bits of sanitary ware is producing per day by Ras Al Khaimah together. It has procedure in China, Sudan, Bangladesh, India and Iran. The global development of RAK Ceramics has ended 3, 60, 000 sq meters of tiles and 11, 500 pieces of sanitary ware per day. These huge development of tiles making RAK Ceramics' one of the greatest multinational ceramic and porcelain tiles and sanitary creation on the globe.

More than 150 countries across 5 continents, they are actually exporting. In the Far East, Australia, USA & Canada along with European countries they sells a big quantities of RAK ceramics with regular shipments to all or any those countries. Among those countries, they may have independent agents to fulfill the marketing work.

With the subsidiaries in Germany, UK, Italy, Belgium, Georgia, Australia, China, India, Saudi Arabia, Sudan, Bangladesh & Iran, RAK Ceramics' herb capacity stands as follows-

China - 11 million rectangular meter per annum,

Sudan - 6. 5 million square meter per annum,

India- 7 million square meter per annum & 250, 000 pieces of sanitary ware per annum,

Iran- 3. 0 million square meter/annum and

Bangladesh - 6 million square meter and 250, 000 bits of sanitary ware per annum.

In terms of the model, they also have wide range of variance. They regularly add several new designs in almost every week. Not only in creation and design, RAK has large selection of size variety in their products from 10 cm x 10 cm up to 125 cm x 185 cm. They also has 125 x 185 slabs which will be the most significant Gres Porcellanato slabs on the planet and used for a number of internal and external applications.

RAK Ceramics is a ISO 9001: 2008 (ISO 9001:2008 Quality management systems Requirement is a file of 30 webpages which sets benchmarks for organization's management ) & ISO 14001: 2004 (ISO 14001 is a typical which is provided by international business for standardization for reducing the negative impact on environment ) authorized organization.

RAK Ceramics (Bangladesh) Limited:

RAK Ceramics (Bangladesh) was contained in 26 November, 1998. It is a joint venture company with UAE. It had been first incorporated as a open public limited company. Now it is general population limited company and modified its name from RAK Ceramics (Bangladesh) Private Limited to RAK Ceramics (Bangladesh) Small on 10 June, 2008. They are actually developing ceramics tiles, bathroom units and all types of sanitary ware. They basically came to this position of producing products in a few steps which receive below-

From 12 November, 2000 they started out Commercial development.

From 10 January, 2004 they start the production of sanitary ware of their own flower.

Further enlargement of tiles and sanitary place ware in the year of 2007.

With 90% portion of ownership of RAK Ceramics by RAK Ceramics PSE and its own nominees they essentially start their business in Bangladesh. Slumber 10% is possessed by S. A. K. Ekramuzzaman. Within eight years RAK is becoming one of the leading manufacturing companies with an twelve-monthly turnover of over BDT 3248 million. They fundamentally produce high quality wall structure, floor tiles, gres porecellanato and sanitary wares products in Bangladesh.

RAK is financed by IFC Bangladesh other than Lafarge Surma Cement Ltd, the one two company financed by IFC. With over 1000 models dynamic ceramics and porcelain they have huge collection of design. Additionally, their R & D are adding more new design to their portfolio to meet the preference of the clients. They have significantly more than 40 models of exclusive selection of sanitary ware like clean basins, drinking water closets, bathroom models, bath tubs, shower trays, bathroom cabinetry, accessories and furnished models. . They not only emphasized in the creating part of the RAK Ceramics, but also they emphasized in the size of the tiles. They have got different types of tiles from 13 cm * 13 cm to 60 cm * 60 cm.

The manufacturing plant has a production capacity of 24, 000 square meter tiles and 2, 500 pieces of sanitary ware per day. This total development is consumed by local market. RAK Ceramics (Bangladesh) Small is accredited by ISO 9001:2008(ISO 9001:2008 Quality management systems Need is a document of 30 pages which sets criteria for organization's management). RAK ceramics also have a future plan to expand their procedure by setting a new production place in Hobigonj to satisfy the rising domestic demand for tiles. Because of their reputation and good brand image they have been honored as "Superbrands" in 2009-2011


RAK is the market leader of the ceramics industry in Bangladesh. RAK has about 35% market share in the industry. The major competitions of RAK ceramics are:

Fu-Wang Ceramic Industry Ltd: Fu-Wang Ceramic Industry is one of the major opponents of RAK ceramics. Fu-Wang's main emphasis is on the quality of the product as well as are focus on designing also. They are also focused on attaining customer satisfaction by providing standard product with invention. Fu-Wang's market capital is 2025. 375 million BDT (http://dsebd. org/displayCompany. php?name=FUWANGCER). The primary production seed of Fu-Wang ceramic industry is Hotapara, Gazipur.

China-Bangla Ceramic Industry: Another major rival is China Bangla Ceramics Industry. They concentrate mainly in the grade of the product. For these they in essence use machine brought in from SACMI, Italy and specialized people recruit from china to use production process, technology and R & D.

Great Wall membrane Ceramics Sectors Ltd: Great Wall structure Ceramics Sectors has a manufacturer in Gilarchala, Sreepur, Gazipur, Bamgladesh. From Italy and China they essentially bring their machines which are getting used to make their products. Great Wall membrane Ceramics Business Ltd is also concentrated to improve their quality of their products.

RAK is not facing any major competition from the local manufacturers. RAK ceramics market capital is 46635. 898 million taka (http://dsebd. org/displayCompany. php?name=RAKCERAMIC). However they are facing competition from Chinese Tiles. The primary Raw material for Tiles differs clays. And among those clays China clay is a significant element. China has an advantage above the cheap recycleables which helps them to reduce their creation cost and gain gain over other competition. Whereas RAK have to get raw materials at a price and also pay taxes for those recycleables. However RAK set up them as market innovator by giving superior quality product and good brand image which permits them to contend with the competition effectively.

SWOT Matrix evaluation of RAK Ceramics: RAK Ceramics is the marketplace head in ceramic industry. They have huge advantages which differentiate them from other competition ex: advanced creation facility, focus on quality, and huge investment in R&D, customization option in product developing etc. These are the major talents which is helping RAK ceramics to be the market leader. They also have a major weakness in charge of sub traders. RAK ceramics hold the possibility to go for exporting after get together domestic demand and they can also expand their product line by producing ceramic plates, salt and pepper pots. RAK ceramics is facing danger on competition for the growing Chinese ceramic companies. This is actually the summary of the SWOT examination of RAK ceramics, quick justification and SWOT matrix analysis is given in Appendix 3.

The Value Chain Process: RAK ceramics value string process follows the traditional value chain process which starts from supply chain management to providing its products to the end users and assisting activates like: R&D program, general administration and human source management. RAK ceramics is totally backward and forward integrated. The worthiness chain procedure for RAK ceramics is detailed below in details.

Primary Activities:

Chapter: 01

Supply chain management: RAK ceramics source string management is very strong and fully controlled for getting productive supply because of their production process. The basic raw material of ceramics differs types of clay. RAK ceramics choose the best quality clay because of their quality flooring. RAK use different types of clay for his or her tiles development. The types are:

Indonesian Clay

Malaysian Clay

Indian Clay

China Clay

Bangladeshi Clay

Czech Republican Clay

For glazing or colouring there are several raw materials that RAK use to give an advantage in color of the tiles. This materials arrives from Italy and Spain. The materials are:

Color Pigment

Cerfrit: a business customized in the make of frits, glazes, serigraphic printing powders and ceramic colors

Adhesive and Chemicals for stabilizing color

Raw materials Suppliers: 90% of raw materials of RAK ceramics is are imported from beyond your country. The main raw materials provider of RAK is Global Business Association (GBA) and the equipment are dealt in purchasing process. GBA is a sister matter of RAK looked after supplies recycleables to other company's also. RAK places an order of the set of raw materials and GBA provides the recycleables. Cerfrit an organization from Spain equipment "cerfrit" for using in colors. Color pigment is supplied by GBA which is gathered from Italy.

Shipment of Raw materials: After positioning the order to GBA, recycleables are directed by ship to Chittagong interface and sometimes in Naryanganj from Chittagong interface. Following that Cargo trucks are used to carry the clay with their production plant. Spare parts for their machineries are collected from "SACMI" which is a giant of developing machines and concluding plants and it's really an Italian company. These extra parts are delivered by air.

Packing Raw Materials: The packets which are used to pack the final products are given by KEA Printing and Packaging Company which is also a firm of RAK. They provide cartoons that are used to offer tiles. KEA Printing and Packaging is situated right before RAK's manufacturing plant in Sreepur, Gazipur. Therefore it's quite simple to gather the cartoons from there.

Inventory Management: The inventory management job is mainly given to Store division and accounts office. Accounts department manages raw materials inventory. Raw materials are purchased and stored in the amount of 6 to 7 months of production. Store department is in charge of the management of finished goods inventory. RAK requires extra safeguards for not damaging or wasting recycleables and extra security for stopping the chance of theft.

Utilities: They main electricity for RAK is creation flower is Electricity. RAK ceramics put in over 50 crore taka for planting an electricity flower which produces 6 Mega Watt electricity inside their production seed. RAK uses 4 Mega Watt and 2 Mega Watt of electricity is directed at local people for their use with an exchange of a tiny sum of money.

Chapter: 02

Manufacturing Process: RAK ceramics contain the most advanced production service for producing tiles and sanitary ware. They have got one production place for tiles which includes all the production activities. RAK likewise have a Design Development Program under R&D office which really helps to create new design for the clients. In this division, RAK have invested a huge amount to gain benefits over rivals in planning. They are employing SACMI technology in their creation plant which originates from Italy. SACMI is the most advanced technology used is ceramics production. RAK's production herb is fully automated and computer run which helps to reduce the chance of problem. SACMI's machineries are sensor located in which it is assigned the specific tasks to be performed with minimum error. Atlanta divorce attorneys step of production there is a parameter that has been checked for insuring good quality by guaranteeing size, moisture; pressing electric power etc.

Step1: RAK's tiles making process begins from Laboratory There is a small version of the complete production vegetable. In lab "master sample" of tiles with different shapes are made based on moisture, pressing electricity, thickness etc. This professional test is the benchmark of tiles which can be used to maintain the typical and quality of tiles. This grasp sample's readings are arranged into Master CPU for quality assurance of tiles. If the quality of any tiles doesn't meet up with the standard of "master sample", it is damaged by Get better at CPU by by using a hammer.

Step2: Quality guarantee department composes the structure of raw materials, which means the ratio of different clay will be utilized to produce the body of tiles. This composition list is given by lab on the basis of the composition used in Master Sample.

Step3: Body prep sector calculates the weight of different clay which will be used to help make the tiles.

Step4: Raw materials are given insight in Container FREEDER by the assistance of wheel loader. Drivers of steering wheel loader checks the list and weight of each clay and inputs in the device. There is an operator who displays this procedure. Shape: Pack FEEDER

Step5: From Field FREEDER by the use of conveyr belt, raw materials are transferred to BALL MILL.

Step 6: In BALL MILL the raw materials are mixed with water to make slip, this procedure is named "milling".


Step5: From BALL MILL today's form of clay which is also called slide is stored into Slide TANK.

Step6: From Slide TANK, slip is migrated to SPRAY DRYER, which sorts the slip into powder or granule. This natural powder or granule is stored into SILO or vertical tank.

Sttep7: This natural powder will be passed into PRESSING MACHINE through SILO. In PRESSING MACHINE the powder is given five pub pressing which changes the powder or granule in to uncooked tiles.

Figure: SILO

Step8: In PRE-FIRING the fresh tiles are taken through 200 degree Celsius, to lessen the water of the raw tiles.

Step9: The organic tiles will now feel the DISC Glazing BOOTH machine, where it will be covered by the first coating of Color or Glazing.

Figure: DISC Glazing BOOTH

Step10: Following the Disk Glazing BOOTH process the tiles will feel the PRINTING MACHINE and there it'll get the required designs at the top.

Step11: Through the PRINTING MACHINE the tiles are filled into Launching CAR by the conveyer belt, and then your LOADING CARs take the tiles to B&T KILN Launching MACHINE.

Figure: Loading Car Physique: PRINTING MACHINE

Step12: B&T KILN Launching MACHINE is basically a firing machine gives huge high temperature on the tiles to boost the hardness and consistency. It really is a 75 meter long range also known as

Figure: 75 meter B&T KILN Launching MACHINE

firing area. The tiles is taken through a sequence of temperature starting from 400 to 800 to 1200 to 800 to 400 Celsius. The temperature sequence is held such as this because after achieving to 1200 if the temperatures suddenly falls then the heated up tiles will break down. To ensure ongoing supply of power the kiln machine is connected with a generator to avoid any type of accident. Granite tiles are placed in firing machine for 41 to 42 minutes, Porosa is placed for 39 to 40 minutes and Red Body tiles are kept in firing zone for 35 to 36 minutes. The time maintained in firing zone is the determinant of hardness, stability and drinking water absorption. Granite tiles are used in floor which includes high reliability, hardness and water absorption to 0. 5%. Alternatively, Red Body tiles that happen to be wall tiles has less stability and hardness then Granite but have high water absorption up to 10%.

Step13: Professional CPU plays a significant role in the tiles development. Master CPU is provided with the reading of expert test for quality guarantee of the tiles creation. Professional CPU approves those tiles which match with grasp tile. If not then Get good at CPU uses a hammer to ruin the tiles with below quality reading. After passing tiles from B&T KILN Launching MACHINE every tile have to feed Master CPU and it also checks the level of tolerance for problem. ISO 10545 is a English Standard for tiles development which gives authorization for 5% error. But RAK ceramics accepts 3% degree of error for guaranteeing more quality for their product.

Step14: After checking by Master CPU, the tiles which have 0% error are classified as School A tiles and those tiles which have 3% problem are classified as School B tiles. These two types of tiles are sorted differently in several sorting machines where tiles are located vertically in numbers for packing which starts off from: 4 pieces of tiles to 25 bits of tiles.

Step15: Tiles are filled by PACKAGING MACHINE attached with receptors. These sensors detect School A and B tiles and uses different deals for both. For Category A tiles white package and for Course B brown containers are used. Then it is tagged by another sensor using OCRCS system. This technique is employed to track the type, quality, size and other variables by which they can keep track of the operator who examined the tiles when there is any complain form sellers or customers. The operator's main job is to guarantee the quality of the tiles by checking out them from 3 ft distance to see whether you can find any issue with tiles that can be diagnosed from 3 feet distance. When there is any problem enjoys this, operator is held accountable. The OCRCS refers:

Operator: Quantity of Operator

Choice: A grade or B grade

Reference: Model Number

Caliber: Accurate size

Shade: Color of Shades

This OCRCS is employed to provide customers full make sure of the grade of the merchandise and also helps to prevent fraud try out by retailers.

Step16: After product packaging, the completed goods are stored in warehouse by Stock Division and dealers arrive with order paperwork of tiles to receive the delivery of the tiles for Stock Office.

This is the full total manufacturing process of RAK ceramics.

Chapter: 03

Distribution Process: RAK ceramics uses simple distribution process to get products to get rid of users by reducing complications. They follow 4 level distribution channels which contain manufacturer, dealers, sub sellers, consumers. RAK follows selective distribution which means they disperse products only few marketers. They don't really have their own distribution channel; they use sellers to distribute their products. Currently RAK has 32 dealers around Bangladesh. They directly control their dealers through 4 express professionals in six divisions. Traders are allowed to appoint sub retailers to market RAK's product but RAK will not control them.

RAK ceramics syndication process starts off from stock office. Stock department stores completed goods in the warehouse. Sellers are informed from the warehouse that their goods are ready for delivery plus they arrive to get the delivery from warehouse for circulation. RAK ceramics have full control over their selective dealers. They pick sellers from location corresponding to their physical planning of market capturing. RAK ceramics carry out a detailed evaluation before selecting dealers. RAK ceramics first analysis their collection ex: capabilities, currently which products they are distributing, control, coverage, continuity and also they are given 3 months evaluation period by which RAK tries to find out if they're appropriate or not. These 32 retailers have sub retailers who are straight under control of dealers which they use to fully capture more market depth and cover more geographic coverage. Dealers pick the product from RAK ceramics by huge delivery trucks with good protection for not detrimental tiles. By help of retailers and sub retailers RAK ceramics send out their product to the end user and also they maintain a rigorous control for reducing error.

Chapter: 04

Marketing, sales and service: RAK ceramics is the market innovator in ceramics production in Bangladesh. RAK ceramics mainly highlight on commercial development for meeting home demand nonetheless they also have commercial development which is not in large condition due to low demand and huge affordability concern by sectors in Bangladesh. But if a company places order for commercial tiles they match their demand. RAK have a good marketing section for marketing which is the main head office in Uttara. RAK ceramics sales force is mainly used to influence owners of industry businesses to work with RAK ceramics because industry productions of ceramics product have high sturdiness and price. To provide good support to these buyers, the sales force is principally used for just about any complaining and purchasing and also providing important info. The procedure mainly begins from industry putting order with features to retailers of RAK, sales force contacts with the customer to provide more specific information and details along with costs and choice, sales force confirms their specifications and sends it to RAK. RAK ceramics go directly to the development and send their product via seller to the required person. This is actually the role of sales team which takes on a vital role in reselling industrial products. RAK ceramic doesn't use any direct selling in marketing, if a person place order from RAK head office where they have a showroom, then instead of selling directly to them RAK provides guide of nearby dealers with their location for providing convenient support. As it is discussed earlier, RAK ceramics uses sales team for industry potential buyers and dealers reference point for normal customers.

Marketing Research and Planning: RAK screen new design of tiles and sanitary wares in their main hq for getting feedback from customer about the new design. This new design mainly is the representation of ongoing global craze about the world or the new design of RAK UAE which really is a great success worldwide. This new design is positioned in the main showroom for six months for gathering comments from customers. After getting responses and doing market evaluation each goes for development on those new designs. RAK provide huge emphasize on marketing research to identify new style trends on the basis of global development and customer choice. Because of their advanced marketing research they are able to imagine the demand of customers. For their good general market trends, examination and reading, they could respond quickly to the changing customer demand and inclination which made them the marketplace leader.

Advertising and Promoting: RAK ceramics doesn't follow massive advertising way of promoting because of their superior position in the market and huge demand helps to promote their product itself. But RAK still do some advertising via billboards plus some promotional activities in Boishakhi TV by sponsoring some shows, because the Managing Director of RAK ceramics is the 25% owner of Boishakhi Television set.

Support from Dealer: RAK ceramics have 32 retailers around the united states which can be handpicked by them after judging their stock portfolio. These retailers provide great support to RAK for capturing and permitting the product to get available in market. RAK ceramics tries to provide full support on the activities for making them more adaptable and dealers provide support for making the merchandise more available in market. From RAK's perspective, by the support, help and commitment from these retailers have helped them to spread the merchandise entirely country and they also played a huge role because of their market position.

Service: RAK ceramics doesn't have a special service centre for customers since it isn't required for the reason that extend. But they provide full support to the clients by providing information and details of tiles before purchasing to avoid deceptive selling.

Supportive Activities:

Chapter: 05

Product R&D, Technology and Systems Development: RAK makes a huge investment on R&D. They are the only ceramic company in Bangladesh to spend 150 crore in R&D. To create continuous technology on design they have a dedicated Laboratory which focuses on creating new tiles and sanitary wares. RAK use SACMI developing machines and complete crops for the Ceramics making which is the greatest technology to make ceramics. RAK uses Effluent Treatment Herb (ETP) to lessen environmental risk. RAK ceramics manufacturing plant have computer controlled led vehicles which transfers semi finished good from stop to station, all of the machines are manipulated by laser detectors, skilled technician to operate sophisticated businesses. RAK ceramics focus on more on building on tiles. For this function the MD of the company attends different Ceramics reasonable to get idea of overall new technology creativity and new design tendencies. These designs are submitted to Design Development Program which falls under R&D division; they conduct comprehensive research and develop the look. RAK also offers land scientist who conducts research and test on various types of soil to generate quality structure of clay for creating quality tiles. Purchase professionals trip to Indonesia, Malaysia, India, China and Czech Republic to monitor Category A and B uncooked material (clay) and check quality article and sent it to laboratory more researching on clay about the quality. A dynamic team of ceramist is focused on find more cost effective solution for gaining competitive edge over competitors. Anticipated RAK's huge investment and determination on R&D, permits them to contend with competition and gain competitive gain.

Human Tool Management:

Recruitment and Hiring: In RAK Ceramics, HR team is totally co-ordinate according with their standard. The complete recruitment process is described below step by step.

Step 1: To recruit staff for RAK Ceramics, they quite simply go through-


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