Marketing Analysis and Opportunities of PE Foam Product in Bangladesh of Joongbo Multimode Chemicals

Strategic Marketing Plan for JMCL

In the context of steadily escalating competition in Markets all over the world the need for Strategic Marketing Plan becomes imperative. The modern management has a positive role to play in terms of achieving corporate goals and objectives of an organization on a planned basis. JMCL is a pioneer business house in the area of Industrial packaging, Insulation, Comforter, BTS and Sundry etc which is operating its business under the Brand name JUMBOLENE. As we all know that a new company named as Syntex Polymer (a unit of Nasir Group) already launched its products in the same fields so we should change our marketing strategy and plan to stay alive in the market. So the prime goal of JMCL is to grief the existing market in our custody and simultaneously to expand the present market in a planned manner. To achieve planned results it is imperative that personnel at all levels acquire a high degree of professionalism. Considering this facts Strategic Business Plan will show the pathway of success to the ever increasing competitive business fields.

Customer Information

A market oriented organization continuously gathers information about customers. The marketing concept advocate starting with customer needs & wants, deciding which needs to meet, and involving the entire organization in the process of satisfying customer needs. The market oriented organization understands customer’s preference and requirements & effectively deploy the skills and resources of the entire organization to satisfy customer. A company can be market oriented only if it completely understands its markets & the people who decide whether to buy its products.   

Threats and Opportunities of JMCL

According to the market scenario threats and opportunities of JMCL would be-

a) Threats:

1. Intensifying competition from the importer and manufacturer of Glass-Wool, Rock Wool, Bubble Foam, PU Foam, PS Foam, Raya, Thermo cool, Elastomeric Foam and the new PE Foam Manufacturing Company.
2. Downfall tendency of orders and inconsistencies of orders which leaving the company to forecast properly.
3. Lack of skilled factory workers and turning to new professions.
4. Raw materials are imported, supply/price situation changing depending on the changing global economic situation.
5. The latest technology of the newly established company will definitely be a threatening point for JMCL.

b) Opportunities:

1. The company under MULTIMODE GROUP is well known in this sub continent.
2. Technology bought from Korea.
3. Eco-friendly products.
4. Some factory workers are skilled.
5. Corporate buyers are gradually increasing.
6. Raw materials of the produced items are available in the country.
7. Production capacity of the factory is somewhat satisfactory.
8. Huge opportunities lie in the entire Pre-Fabricated Steel Building Sectors, Garments, Pharmaceuticals, Poultry, Telecommunication and mattress sectors.

Marketing analysis of  PE Foam Product in Bangladesh 

First of all I would like focus on Business Development Options JMCL:  

Action Programmers

Part-A:

Part B:

 Market Opportunities Analysis

2.4.10 Total Market size of Insulation & Packaging Industry

Market share: Glass wool is the market leader of insulation market. This product has lot of demerit & harmful for human body. Sometimes it causes carcinogenic disease to the human body.

Source: Primary                       Table 7: Market Share in Case of Insulation

SWOT Analysis & Marketing Mix of JMCL

5.0 SWOT Analysis

5.1 Strengths

• JMCL produces 100% environment friendly products.
• Marketing of the company is being managed by itself.
• Self sustained company without any outside financial assistance.
• The numbers of potential corporate clients are increasing significantly.
• JMCL has no competitor in the market place, which produces PE Foam products.
• The company under MULTIMODE GROUP is well known in the local market especially due to the name of ‘CEO MR. ABDUL AWAL MINTOO’ for the buyers of making it distinct.
• Raw materials of the produced items are available in the country.
• Some factory workers are skilled.
• Some staff/workers those who are associated with the company are skilled, potential and have the ability to cope with product diversification and new design within short time if training is provided.
• Production capacity of the company seems somewhat satisfactory.
• Some basic tools are available in the company for quality control of the produced items.

5.2 Weakness

• There have no doubt been many flaws; some of the important issues are listed below-

• No strategy vision worked out as yet for the company
• JMCL is not a Marketing Oriented company. It is a sales oriented and Accounts based company
• JMCL is not an ISO Certified Company, which is unexpected in the open market economy
• Company lacks salary structure and yearly increment policy for the officials and salary discrimination persisting in terms of educational qualification, knowledge, skills, sincerity, honesty, dedication, designation and position carrying gravity
• There is no system for assessing need to develop skill of the staff by providing training
• The company has no local outlet to maximize its profit for meeting demand of the country consumer on different items like other foam material producers, or by selling rejected or unnecessary items.
• JMCL has no transport for just in time delivery of goods to the valued clients. As a result the function of requisite customer service is hampered seriously
• There is no attempt to diversify the product design or develop the product quality seriously. Non-diversified products, delay in product development, lack of use modern technology by the workers and JMCL Administration
• Packaging of the company is not up to the entire satisfaction level. This should be more cost effective according to the buyer’s choice.
• Lack of adequate space of the company especially for ‘Store, Packaging and Quality Monitoring’ sections.
• The company has no cutting machine. So that the workers cut the products manually with knives which is time consuming. Moreover by cutting the products manually quality of products as asked by the valued clients could not be done properly
• Many buyers reported problems with bubbles, washable chemical coating of foil, not water and fire proof products, non-uniformity of cells, cutting & finishing problems
• JMCL can’t produce PE Plank having width 60” (sixty inches). Most of the buyers in the mattress sector demand for 60” width PE Plank. They meet their demand through import.
• Job description with clearly role and responsibilities and authority of the staff is not defined
• Administration and staff rules are not suitable for the JMCL staff
• In many cases overlapping of the duties and responsibilities are creating confusion and dissatisfaction among the staffs. For example, accounts related job are being done by the ‘JMCL Factory level and Head Officer together’. As a result that concerned personnel both from the Head Office and Factory Office misunderstand each other, which are unexpected for smooth business operations
• Company lacks transparent policies in connection with appointing a person as factory worker/lab our
• Some of the existing policies of the company on remuneration package, salary increment system; tour policies, leave, weekly holidays etc are not in line with the MULTIMODE GROUP’S policy. Some existing rules and practices are confusing.
• There is no policy to retain the potential employee in the company
• Some sections are quite inadequate staffed which seems that the ‘Man Power Distribution’ or allocation system has not made on the basis of need analysis
• Some staffs don’t have requisite competencies for the positions they are holding now
• The company does not have any clear credit programmed.
• Productivity of the company workers in generally is low due to the want of written appointment letter depicting role and responsibilities of the individual staff in a clear and an understandable manner to achieve maximum output on a regular basis
• The company does not have any committee such as pricing of items, Procurement, Need assessment, Development activities, crisis situation handling etc
• Company lacks clear guideline to provide training to its potential staff to develop skill in the field of product development, market promotion, quality monitoring etc.
• It does not have also any financial incentive package for the staffs like some other companies of the country in the form of performance/ sales /production bonus, equity etc.

5.3 Opportunities

• As JMCL is the first who made this product company  in Bangladesh, it has ample opportunity to grief the whole market gradually and hence to boost us its business within shorter span of time
• Vast market in the entire Construction sector, Defense, Telecommunication, Power Plant sector, furniture industry, RMG sector, Industrial Ducting and cold storage etc are increasing significantly along with many packaging, shoes, mattress sectors etc
• Huge demand for commercial buyers could be met.
• Scope for diversification of the products ranges on existing and new items
• Financial and technical assistance could be taken from the donors and technical experts etc for design development, cost effective and most scientific way of packing, shipping, market promotion activities etc
• The company has some regular reliable and trusted corporate buyers
• Attending in different regional and national trade fairs and follow up visit
• Well planed advertisement through mass media to popularize the product
• Direct contact and co-ordinated campaigns with different marketing persons of the MULTIMODE GROUP and sending samples to different buyers of their respective areas
• Assistance from the local business chambers for getting information on different potential buyers
• Lobbying and advocacy with the ministry of banning Glass Wool & Rock Wool import or imposing high duty structure
• As far as possible minimizing the overhead cost and by lowering the prices of the products could be more competitive to the buyers
• Timely documentation and shipment
• JMCL can try to make the raw materials stock and available for production purpose in the crisis time of the year. This step could be benefited the JMCL administration and buyers from the aspect of uninterrupted supplies to the clients.
• Dependency on some buyers could be reduced significantly by developing more aggressive marketing and sale plan and to ensure products throughout the year.

5.4 Threats

• At present there are another competitor exist in the market place, which produces PE Foam Product. As a matter of fact JMCL has been running its business without too much competition irrespective of whether it has lots of loopholes, problems and demerits. We came to know from different sources that one or two PE Foam manufacturing units are going to launch their products soon. In open market economy the existence of several competitors in the same market is very much acceptable. But the focal point of threat is that if those competitors figure out the demerits/problems of JMCL and hence launch their products without having the drawbacks, which JMCL has at a this moment, then there would be a strong possibility of losing the market gradually
• Lack of initiative of the respective section heads and want of integrity among the staff due to failure of proper guidance
• Intensifying competition from the importer of Glass Wool, Rock Wool, Air-bubble Foam, Padding Foam, Heat Bond, Felt, Thermo-cool items. The company lacks adequate and necessary information to develop new products as well as to provide training to the workers for making new items
• Lack of skilled factory workers and turning to new professions
• Raw materials are imported, supply/price situation changing depending on the changing global economic situation
• Influx of superior quality substitute products in the market place
• Production capacity of the company is not as much as to meet the ever increasing demand from the clients.

5.5 Marketing Mix of JMCL Product in Bangladesh

Here the four P’s will be described in briefly:

5.5.1 Product

Product Description of JMCL

The basic product is two types:

     a) PE foam Sheet

     b) PE foam Tubes & Rods

The above two product can be of varied sizes, colors (with specialty characteristics) and lamination. Then, these variants of the basic products can be converted in to a lot many products stretching to the domain of creative utility designing by the producers.

a) PE Foam Sheet:

The PE Foam Sheet can be produced at 0.5 mm to 5 mm in nominal thickness. The real thickness ranges around +20% of the nominal thickness. The width of the sheet can be 100 cm to 150 cm and lengths from 60 meters to 600 meters. They are handled in roll forms. The colors are

• Basic                          –           White
• Fire retardant             –           Grey
• Antistatic                   –           Pink
• Biodegradable           –           Green

b) PE Foam tubes and rods can be produced in various thicknesses.

2.2.4.2 Innovation & Improvement

Polyethylene Foam is considered to be the finest synthetic foam in the world for its unique features and characteristics. But the PE Foam production facilities were not available in this region and such no specific market had developed for this item. It will be appropriate nice to say that Joongbo Multimode Chemicals Ltd. is going to introduce PE Foam products for the first time in Bangladesh. The most convenient and easy application of this creative item is in the Industrial Packaging field. Others field of application where this PE Foam product can substitute existing other materials on use are Construction, Insulation and Comforter and Sundry field. Eventually we can say that PE Foam is the latest innovation in the context of Bangladesh. The following comparisons between the PE Foam products and existing other materials will definitely support this.

Industrial Packaging Field

PE Foam is an ideal material for the packaging the various kinds of instruments because of high restoring nature and high-energy absorption. Being soft in feeling and beautiful in appearance, it is also suitable for packaging and as materials of high quality goods.

Table 2: Use of PE Foam in Industrial Packaging Field

Construction & Engineering Field

PE Foam has a closed cell structure which is exceedingly suitable for anti-humidity, waterproof, sound proof and easy in handling.

                                                                        Table 3: Use of PE Foam in Construction & Engineering Field

 2.2.4.5 Insulation Field

PE Foam is an ideal insulating material because of high resistance to heat conductivity, damp proof and no water absorption.

                                                                         Table 4: Use of PE Foam in Insulation Field

Comforter & Sundry Field

PE Foam has excellent flexibility in its quality features including anti-static characteristics, rugged, durable, waterproof, high chemical resistance and decent appearance. Some typical applications are shown in the table below-

                                                                   Table 5: Use of PE Foam in Comforter & Sundry Field

It can be proved by the above mentioned comparisons that Polyethylene foam is distinctive in its unique features and characteristics. Foam Sheet are deemed to be the most promising field of business for PE Foam products. Highly qualified and technically competent employees of the company are involved in a well structured system of brain storming, product development, product testing and continual development in order to develop the new product ideas, designs and to popularize PE Foam in Bangladesh.

 Characteristics of PF Foam

• The main products PE foam are Plain Sheet, Foil Laminated Sheet. Plain Sheets’ market is suited basically in the old town i.e. Malitola, Bangshal, Naya Bazar, Siddique Bazar, Suritola, Nawabpur which is considered as the wholesale and retail market, PE Foil Laminated Sheets are widely used in the Pre-Fabricated Steel Structure Building Projects and a major portion in the Deducting Sectors. PE Planks are widely used in Mattress and Telecommunication Sectors.
• JUMBOLENE is a closed cell PE Foam structure with aluminum Foil & without Aluminum Foil and is the perfect insulator day night with neutral reaction from physical & Chemical substances.
• JUMBOLENE is suitable for moisture and humidity resistance. Superb insulation against water and heat retains original structure and does no deflect.
• JUMBOLENE is safe and trouble free installation with excellent elasticity against heat insulation of all types.
• JUMBOLENE is fire resistance produced from clean, non toxic materials and recyclable.
• JUMBOLENE is cleanly installed under the roof of metal Sheet or asbestos, fast, easy and cheaply installed
• JUMBOLENE is used above the ceiling in the house of all types.

5.5.2 Price

In interviews with trade sources, price appears to be the most critical competitive factor. However, unique and superior product features, effective promotion to the major building contractors and engineering and architectural design firms, technical assistance, and a reputation for excellence are also very important, and will definitely assume more weight as soon as end-users demand superior and certified product performance.

 The price of PE foam is competitive but still allows making a reasonable profit. The pricing strategy takes consumer threshold into account. The prices of different product ranges of JMCL have been set through a process of calculating the costs of production, estimating the benefits to consumers, and comparing the products and prices to others that serves the similar purposes.

5.5.3Promotion:

 Essentially the Advertising and Promotion section of the marketing plan describes how JMCL is going to deliver its Unique selling Proposition to the prospective customers. Until now JMCL has made only sporadic unconnected attempts to promote its product. But its goal should be to plan carry out a sequence of focused promotion activities that will communicate with its potential customers. The message that JMCL wants to send to its target audience should be stated clearly. The unique feature of the product Jumbolene should be underscored in these messages to attract the target audience. For example, since the health hazard-free nature is the most unique feature of Jumbolene the product positioning should emphasize over this point.

5.5.4 Place:

PE Foam is distributed through sales representatives. Right now the company is following a direct distribution channel by which the product or service goes directly from the factory to the customer. The one stage distribution channel by which the product goes from the factory to the dealer and/or retailer and then to the consumer should also be introduced.

Distribution Flow of JMCL

Brief description On competitors

Briefs from Swan Mattress

The estimated size of mattress market in Bangladesh is TK 1 to 1.5crore.

•           Swan Mattress captures a significant 25% market share.

•           “Liyht and Tight” is the brand name for PE foam mattresses brought to the market by Swan Mattress.

•           Primarily the urban and the semi-urban people having the ability to indulge in   style and comfort are the end users of mattresses.

•           PE foam mattress is lighter in weight and therefore easy to lift.

•           The cost of PE foam mattresses is notably higher than the other ones.

 Briefs from Engn. Jahidul Islam 

•           Roughly TK 400 crore(approximately) worth steel building projects are annually undertaken in Dhaka and its adjacent areas alone.

•           Approximately (5-6)%7 of the total project cost is incurred for the insulation purposes including thermal and acoustic insulation.

•           Pre–engineered Steel Building Manufacturers’ Association of Bangladesh(PESMA Bangladesh) is an association of steel building manufacturers which represents 22 companies located in Dhaka. The members of this association share expert knowledge and care for each other’s values. Activities include seminars, symposiums, conferences etc.

•           PE foam has an enormous potential in the insulation market which is merely a matter of grabbing the proper channels for effective distribution.

•           Current  problems relating to product enhancements are solvable and/or amendable.

•           PE foam can    easily beat      Capita  Raya,   which  is 3times costlier than PE foam although their features are more or less similar.

Eagle Mattress

Market size is roughly of TK 3.6 crores.

•           Eagle captures 3/4″‘ of the total market.

•           Otobi, Akhter Furnishers, Legacy, Brothers and the Golden Teak are the major clientele.

•           Projected sales of PE foam mattress are TK 15lacs per month.

•           Weight is a major selection criterion for the customers. They seek for heavy-weight mattresses since traditional mattresses are all heavy-weight. The light-weight nuture of PE foam mattresses induces them to probe about   the material.

Eng. Nihar Kanti Mandol

Following measures are essential to develop further market

•   Communication and demonstration of safety of PE foam

•   Increase the density to intervene in the new market (AC)

•   Pipe’s quality should be improved (lamination with HDP)

•   Sector wise dealership will help capturing new market easily.

Confidence Trade Ltd.

•        They import glass wool for AC duct insulation

•           60% of the imported amount is consumed and the rest are sold out.

•           Their monthly consumption of glass wool is 1,000,000 sft.

•           I container of glass wool is consumed per month. The length of these containers is 40 inches

•           Each container contains 400 rolls

•           Each roll contains 260 sft glass wool

  Suggestions & Conclusion

Suggestions

• The strategy of the company should be demand driven based on customer research and market analysis.

• To know the market scenario of the market JMCL should conducts different study with the help of professional research firm aiming to get consumer insight, know the competitors position in the market & so on.

• Separate budget for marketing and promotion activities should be allocated including projections about how much sales each of the activities would bring in.

• A Unique Selling Proposition for JUMBOLENE should be set and used in its advertising messages.

• An advertising slogan stressing JUMBOLENE’S environmental concerns should be created

Technological up-gradation of the product quality is imperative for JMCL to enter into the untapped market segments.

• Strategy vision of the company is to be set by clearly mentioning the time limit and responsibilities of the persons assigned in the process

• More research and development efforts of people with proper technical background are needed for quality enhancement of the product.

• Simple computer software needs to be adopted for including order status, financial

Standings, buyer and country wise business analysis, number of customers, price verification of the items, and rejection quantity and trend analysis with impact indicators.

• Efforts to engage Distributor/ Dealer(s) in the JMCL goal and objective should be made on maintenance of stakeholder relationship should be valued.

• Proper logistics support is needed form top management to establish this business plan a successful one.

• Management should avoid the tendency of delaying while taking any important decision

• Faster support is needed from the management in order to compete in the market place.

• Product Quality such as thickness variation, non-uniformity of cell, rough surface of the sheet, waviness in the texture of sheet needs to be improved.

• Product delivery system should be changed and improved

• Product Engineering is needed to stay alive in the market place for better customer service.

• Just in time delivery system is needed for better customer service.

• Proper packaging for JMCL products should be designed and developed in a planned manner such as each and every roll should be covered by polythene and the respective roles of the products should lack with quality fabrics as sealed with JUMBOLENE logo.

• A product thickening machine must be set in the production line in order to compete in the market and to boost up sales volume.

• Enlistment of a Transport service company is a must in order to deliver goods to the valued client

• New policies should adopt with the existing policies following the competitor’s activities. If any odd situation arises then in some cases existing policies such as pricing, discount policies, customer service pattern, delivery system, credit policies etc. should be change.

Conclusion

JMCL is currently producing different items for the local buyers the sales of which are essentially driven. Unless quality with regard to fire retardant property, low water absorbing capacity, quality aluminum foil, shorter delivery times, delivery on time and other non- price factors, market expansion of Jumbolene would be difficult. The company should take immediate initiative keeping in mind the fierce competitive environment and economic and political turmoil of the country. The fact that cutting edge technological advancements are ensuring in a rapid pace poses dire pressure to take defensive strategies to survive and to shield its own competitive strengths. Outperforming rivals in controlling factors that drive costs is also imperative for proactive managers of JMCL.

Joongbo Multimode Chemicals Ltd, needs to improve its capacity in all respects to become a leading marker player and it should be innovative and scientific from the very within. Revamping overall value chain and tailoring a clear strategic vision are keys to achieve these objectives.