INFLUENCE OF BRAND NAME ON CONSUMER DECISOIN MAKING

PROCESS

ABSTRACT:
The multiple cement brands available in the market make the brand selection a
difficult process. The present study focuses on studying the impact of influencer
recommendation in customer purchase behavior process in selecting cement for
construction.
This will give an insight into the market and try to identify the major influencer
which really influences the customers during cement purchase. Cement customers
are broadly classified into 3 segments- trade customer i.e. dealer/ sub dealer/
wholesaler, retail customer which is individual house builders and nontrade
customer which includes industrial and government infrastructure and. Exploratory
research was done initially with a sample size of 100 which include individual
home builders, masons, builders and dealer to get an insight into of customer
buying process and the variables that influence the choice of cement. Research
instrument used in collecting primary data was the Questionnaire. The study was
exploratory and was descriptive in nature and involved collection of secondary and
primary data based on survey.

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text]

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Objective of the Project:

The major objectives of the project are:
To find out how brand influence the consumer decision making process.
To find out the current market of cement.
To understand the cement market of Nepal.
To find out the production capacity of the cement industries.
To identify the import of cement from the India and third countries.

Introduction of the Project:

This, report is based on the market survey of cement and cement industries in
Nepal. And the survey includes the data collection of the number of cement
industries that are registered in Department of Industries, their production capacity
and also import of cement from India. The report is done in order to see the
influence of brand name on consumer decision making process, because cement
industry in Nepal has excellent chances of flourishing in the domestic as well as
international market.
The use of cement in Nepal came into effect from the beginning of early 1950s as
no cement manufacturing industries existed, early users of cement were dependent
on imports from India to meet their needs. Gradually, around 1965, the supply of
cement was diversified in the form of foreign aid program. The cement was started
to import in commercial scale only in the early 1970s from China, South Korea,
North Korea, Burma, Indonesia, Thailand, Japan, Hong Kong and many other
countries.
The demand of cement has increased due to increase in construction of housing
apartment, complex and also roads, bridges, civil structures. A number of Hydro
Power Projects are in the pipeline, which consume huge cements for their civil
construction work. Apart from a large domestic market; there is tremendous export
opportunity for cement due to Nepals strategic location between worlds two fast
growing economics China and India. Economic growth in either of these will need
heavy investment in the physical infrastructure causing a boom in the construction
industry of which cement is a fundamental input. Cement provides the core basis
for industrialization in any countrys economy and as such it is what Nepal needs
the most to develop its industrial sector and capitalized on the sectors of the
development that industrial growth and also the growth of the country and
generates huge employment opportunities.

MARKET REASEARCH AND DESIGN

Marketing Research is a function which links the customer and public to marketer
thought information used to identity and defines market opportunity and problems;
generate define and evaluate ,marketing action monitor marketing performance and
improve understanding of marketing as a process. Simply marketing research is a
systematic design collection analysis and reporting of data feeding relevant to a
specific marketing situation facing the company, careful planning thought all stage
of the research is a necessary. Objectivity in research in all important the heart of
the scientific method is the object gathering and analysis of the information. The
function of marketing g research within a company is to provide the information
and analytical input necessary for effective planning of future marketing activity
control of marketing operation in the present.

QUESTIONNAIRE DESIGN:
The structured questionnaires that were framed and designed consist of close
ended, open ended, multiple choice, and Dichotonomos,rating and raking questions

QUESTIONNAIRE DESIGN:
Random sampling has been used in this study. Random sampling is used for
selection of homogeneous sample for the study. It refers to selecting a sample of
study objects on randomly. Thus research study may include study objects, which
are randomly located. Research findings based on random sampling however,
cannot be generalized.

LIMITATION OF THE STUDY

Some customers were not able to understand some of the questions.

The sample size was not enough and it failed to give the picture or the result
of the survey (sample size=100) some customers or dealers did not co-operate well.
The questionnaire did not cover the whole aspect of the brand potential of Maruti
cement

INDUSTRY PROFILE:
The word Cement has come from the Roman word Opus Caementicium
.Cement is a binder, a substance that sets and hardens independently, and can bind
other materials together. The most important use of cement is the production of
mortar and concretethe bonding of natural or artificial aggregates to form a
strong building material that is durable in the face of normal environmental effects.
Joseph Aspdin, a British stonemason, invented Portland cement way back in 1824.
With this invention, Aspdin laid the foundation of todays cement industry.

TYPES OF CEMENT

Ordinary Portland Cement (OPC)

Portland Pozzolana Cement (PPC)
Portland Blast Furnace Slag Cement (PBFS)
Oil Well Cement
Rapid Hardening
Sulphate Resisting Portland Cement
White Cement etc.

GLOBAL SCENARIO
In 2010, the world production of hydraulic cement was 3,300 million tones. The
top three producers were China with 1,800, India with 220, and USA with 63.5
million tones for a combined total of over half the world total by the world's three
most populated states.For the world capacity to produce cement in 2010, the
situation was similar with the top three states (China, India, and USA) accounting
for just under half the world total capacity.Over 2011 and 2012, global
consumption continued to climb, rising to 3585 Mt in 2011 and 3736 Mt in 2012,
while annual growth rates eased to 8.3% and 4.2%, respectively.
China, representing an increasing share of world cement consumption, continued
to be the main engine of global growth. By 2012, Chinese demand was recorded at
2160 Mt, representing 58% of world consumption. Annual growth rates, which
reached 16% in 2010, appear to have softened, slowing to 56% over 2011 and
2012, as Chinas economy targets a more sustainable growth rate.
Outside of China, worldwide consumption climbed by 4.4% to 1462 Mt in 2010,
5% to 1535 Mt in 2011, and finally 2.7% to 1576 Mt in 2012.
Iran is now the 3rd largest cement producer in the world and has increased its
output by over 10% from 2008 to 2011.Due to climbing energy costs in Pakistan
and other major cement-producing countries, Iran is a unique position as a trading
partner, utilizing its own surplus petroleum to power clinker plants. Now a top
producer in the Middle-East, Iran is further increasing its dominant position in
local markets and abroad.The performance in North America and Europe over the
201012 period contrasted strikingly with that of China, as the global financial
crisis evolved into a sovereign debt crisis for many economies in this region and
recession. Cement consumption levels for this region fell by 1.9% in 2010 to 445
Mt, recovered by 4.9% in 2011, then dipped again by 1.1% in 2012.
The performance in the rest of the world, which includes many emerging
economies in Asia, Africa and Latin America and representing some 1020 Mt
cement demand in 2010, was positive and more than offset the declines in North

America and Europe. Annual consumption growth was recorded at 7.4% in 2010,
moderating to 5.1% and 4.3% in 2011 and 2012, respectively.
As at year-end 2012, the global cement industry consisted of 5673 cement
production facilities, including both integrated and grinding, of which 3900 were
located in China and 1773 in the rest of the world.otal cement capacity worldwide
was recorded at 5245 Mt in 2012, with 2950 Mt located in China and 2295 Mt in
the rest of the world.

INDUSTRY SCENARIO IN NEPAL

Nepal Cement History:

The use of cement in Nepal came into effect from the beginning of early 1950s.
As no cement manufacturing industries existed, early users of cement were
dependent on import from India to meet their need. Gradually, around 1956, the
supple of cement was diversified in the form of foreign aid program. The cement
was started in import in commercial scale in the early 1970s from China, South
Korea, North Korea, Burma, and Indonesia, Thailand, Japan, Hong Kong and
many other countries.
Cement industries were established by the Government, when there was no
initiative from the private sectors. In 1975Himal Cement Company began and was
established under Germany cooperation with the installed capacity of 130,000 MT
per year and located at Chobhar of Kathmandu, it got closed more than a decade
ago. Then came Hetauda Cement with installed capacity of 260,000 MT per year
and then Udaypur cement with the Japanese assistance in 1980s and have installed
capacity of 270,000 MT per year and these meet only about 12% of domestic
demand. All these three units were mine based. At present around 59 cement
industries in private sector have registered in department of Industries and only 32
cement industries are in operation. The private medium, Maruti Cement Industries
with installed capacity of 150,000 MT per year started production from its plant in
Siraha of eastern Nepal and some small Vertical Shaft Kiln (VSK) technology
based cement industries of 30 to 100 TPD capacities have been producing cement
in private sector using limestone deposit.National Scenario Cement consumption in
Nepal has grown from a level of 1.33 mm t in FY 00 to 3.28 mm tones in FY 11.
The cumulative average growth rate (CAGR) during this period was 8.6% pa. The
CAGR during the past 3 years had been very high (14.9%), this is due to improved
political stability in the country and investment in capacity building projects. The
import of cement into the country has decreased from68% (0.90 mm tones) of the
countrys consumption in FY00 to 22% (0.72 mm tones) of total countrys
consumption in FY 11. On the contrary, clinker imports have gradually increased

and reached 1.32 mm tones in FY 11 from negligible (0.01 mm tones) in the year
FY 00. If cement equivalent for clinker imported in Nepal is also considered, the
cement imports remained over 70% over this period in Nepal.

The Central Region is the biggest cement market with an estimated cement
consumption of around 1.6 mm tones. This is due to development in and around
the capital city (Katmandu), industrial hubs near the bordering towns with India
and setting up of operational base by traders near the entry points with India.

Review of Published Literature

Cement is one of the basic construction materials. From the aspect of availability
of raw material, cement sector is considered as a very important sector in Nepal. It
falls under the category of heavy industries. Nepal has good deposit of the raw
materials namely the Calcium Carbonate or the Limestone and Silica rich clay.
(Abhiyan Product Directory, 2068)
Cement manufacturing offers Nepal a long-term and large scale commercial
prospect and a high promising future. Potential abundant stock of its main raw
material, limestone, within the country and ever growing demand of cement in the
domestic market, that is now heavily dependent on the imports. This shows that
these industries can be one of the major mean of Nepals prospective. Apart from a
large domestic market, there is tremendous export opportunity for cement due to
Nepals strategic location between worlds two fast growing economies of China
and India. Economic growth in either of these will need heavy investment in the
physical infrastructure causing a boom in the construction industry, of which
cement is a fundamental input. (wagle, 2009)
Three big corporate houses in the country- Chaudhary Group, Golchha Group,
Panchakanya Group are preparing to jump into cement production within a couple
of years. These corporate houses are among the nine companies that a couple of
months ago announced to start cement production by the first half of 2012
targeting to replace imports from the market valued at Rs. 25 billion a year
(Republica, 2011).
With a rise in domestic production, the countrys imports of cement and clinker, a
raw material used in the manufacture of cement, have dropped markedly.
According to the Trade and Export Promotion Centre (TEPC), the rate of growth in
cement imports has declined in the last fiscal year. Nepal imported cement worth
Rs 4.63 billion in fiscal 2010-11, representing an increment of 4.1 percent. In fiscal
2009-10, cement imports grew 6.9 percent. The decline in the rate of growth in the
import of both cement and clinker reflects Nepals progress towards self-

sufficiency in cement productions.

According to the Cement Manufacturing
Association of Nepal (CMAN), the domestic cement industries have an installed
production capacity of 5.58 million tons annually which is slightly higher that the
annual demand of 5.42 million tones. However, cement manufacture say their
plants could have utilized their full capacity expects expect for supply side
constraints and government apathy.
However, this hasnt stopped the private sector from entering these sectors in a big
way. Currently, there are 42 factories in operation producing 3.90 million tons of
cement annually. Local production fulfills about 72% of the requirement and the
rest is met by imports from India. Nepal produces OPC, PPC and PSC cement, of
which OPC is preferred these days. (Domestic Cement Industry: On the path to
Self-sufficiency, 2012)
The cement industries in Nepal has excellent chances of flourishing in the
domestic as well as international areas, as the countrys topography is endowed
with large and small deposits of goods grade limestone. According to stakeholders,
about 1,250 millionstones of cement grade limestones is believed to exit in the
country, out of which the existence of at least 224 million tones has been
confirmed through drilling and surveys.
However, Engineer Puru-shottam Shrestha, coordinator of Jagdamba Cement, says,
Despite the abundance of raw material and prospects of growth, domestic cement
productions only fulfills 65 to 70 per cent of total cement consumption in Nepal.
And rest is fulfilled by Indian cement companies.
According to Shrestha, the industries have reached a bottleneck, with the market
being saturated. He says, Around five years ago, 70 per cent of the cement market
depended on imports, while domestic products accounted for only 30 per cent of
the supply. Current, we have reversed the situations by supplying around 70 per
cent of the market demand. However, power cuts, strikes and unfriendly policies
are not only lowering our morale but also dragging down growth. (Korala, 2012)

Key Players in the Industry

Shivam cement:
Shivam Cements Pvt. Ltd.(SCPL), latest venture under flagship of Sharda Group
came in existence in 2006 with capacity of 1250 TPD to manufacture different
grades of cement. SCPLs aim is to provide superior quality cement from its
modern plant which is planned to be located at Hatiya V.D.C, Makwanpur.
The company is provided with high quality limestone from its self-owned mines
situated at Sukoura and IpaPanchakanya Districts. Other high quality raw materials
like Gypsum, iron ore and coal which are important ingredients of cement will be
imported from vendors of international repute. The success and real achievements
of SCPL will lie in its commitment toward quality and satisfaction of the
customers. SCPL assures and believes to provide quality products and best
services, which will be backed up by the latest technology and experience.

Laxmi cement:
Laxmi Cement furthers the vision of Ambey Group by manufacturing and selling
high grade cement to clients at a worldwide level. The company is leading to
successful growth of Infrastructure this way.
The company offers a range of High grade cements. Its product portfolio continues
to expand on account of cutting edge innovation capabilities.
The company is helped by two cement plants in Nepal with consolidated capacities
of Half a Million Tons per Year, while another 1200 TPD plant has been recently
set up in Malta.The company has robust expansion plans, looking at a capcity
increase to 1 million tons per year within 4 years

Agni cement:
Agni Cement Industries Pvt. Ltd is an ISO 9001:2008 certified company with
Nepal Standards (NS) Certified products. This industry is a grinding unit to
produce Ordinary Portland Cement and Portland Pozzolana Cement. Installed
capacity of industry is 300 TPD but in the time being we shall extended our
production capacity and as well as set up new clinker production. This industry has
a work force of qualified engineers and experience professionals. The major
manufacturing facilities include one grinding unit, one stationary electronic
packing machine supported by Quality control laboratory, electrical and
mechanical
workshops.
Still we have plan for the further extension of the same capacity. At present
industry is producing two brands i.e. Agni Portland Pozzolana Cement and Alfa
Ordinary Portland Cement.

Jagdamba Cement:
Jagdamba Cement is a distinct brand name in the Nepalese market. This company
was established in the year 2001 and since then has been the market leader in
cement manufacturing in Nepal. This company also holds the largest market share
in the Nepalese market. According to the market requirement Jagdamba Cement
Industries has different products spread all over the Nepal.

Jagdamba Cement Industries Pvt. Ltd. is to produce & distribute Ordinary Portland
Cement (OPC) and Pozzolana Portland Cement (PPC) at competitive prices to
achieve the needs and satisfaction of its valued customers in Nepal, which can be
achieved through meeting the statutory & regulatory requirements of country,
using high grade of raw material & Continual improvement in quality of works and
services rendered by the company, enhancing the involvement of all levels of
employees, using best available resources and by reviewing quality objectives time
to time.

Kepycement :

Kepy Cement Industry P Ltd takes pride in being a cement plant that has been set
up by promoters having experience in the cement industry for more than three
decades. It has an annual capacity of 54000 tonnes. The company produces and
markets Ordinary Portland Cement (OPC) and Pozzalana Portland Cement (PPC).
The factory is located at Naubise,Dhading. It is based on Vertical Shaft Kiln
technology and is located in Naubise, Nepal. KCIPL was conceived and executed
in the most challenging environment, reflecting the commitment and vision of the
management.

HISTORY OF GRADES OF CEMENT:

In the earlier days, we had only one cement, ordinary Portland cement.
Subsequently, the availability in abundance of fly ash in thermal power stations
and slag in steel plants led to the production of pozzolana cement and slag cement
to conserve energy in the production of cement and to utilize the available byproducts. India was perhaps one of the few countries which produced as much as
76 per cent of the total cement produced as blended cement, which is the common
name of pozzolanic cement as well as slag cements as early as in 1982. Then the
industry was under the control of controller of cements. After de-control, the
production of ordinary Portland cement increased and consequently the percentage
of blended cement came down, currently it is somewhere around 30 per cent. The
introduction of precast / prestressed sleepers for the railways necessitated the
production of a special grade ordinary Portland cement because with the then
available cement, it was not possible to obtain the desired strength as well as the
rate of gain of strength for the production of sleepers. Cement industry was
permitted to manufacture the special grade ordinary Portland cement and it was
commonly known as sleeper cement. Subsequently, the Bureau of Indian Standards
came forward to grade the ordinary Portland cement into grade 33 cement, grade
43 cement and grade 53 cement. This grading closely followed the U.K. grading
which was 32.5, 42.5 and 52.5 as well as 62.5. These higher grades of cements are
specifically introduced to cater to the needs of the industry engaged in the
construction of long span bridges, high rise structures and other structures of
gigantic magnitude requiring high grades of concretes. With the cement then
available, it was very difficult to design a mix for obtaining concrete of grade 4.5
and above commonly used in such structures. After total de-control of cement
industry in 1989 and abolishing of licensing system for setting up of cement plants
in 1992, there has been phenomenal growth in the production of cement. With the
many fold increase in the production of cement, cement manufacturers adopted an
aggressive marketing strategy, each projecting their product as the best.
Manufacturers of 53grade cement invaded the market and created an impression
amongst the consumers that 53 grade OPC could be used by them as it is the best
cement and grade 33 and grade 43 cements, are inferior. In fact, all cements are
one and the same but for minor changes in the characteristics. Grade 33 cements
would meet the structural requirements of ordinary and small scale consumers.

Grade 43 cements may be utilized for precast concrete production besides the
sleeper manufacturers and other building components producers. Grade 53 cements
may be utilized by builders of heavy infrastructure such as bridges, Fly overs, large
span structures and high rise structures. The common man's perception that 53
grade cement is the best cement is not only due to the aggressive marketing
strategies of the cement manufacturers but also on the presumption that the heat
generated during hardening of concrete is an index of its quality. When 53grade
cement is used the heat generated is very high. Hence, Consumers believe that it is
a better cement when actually it is not so.Each cement has to be chosen for a
particular use. While 53grade cement is actually best only for producing concretes
of grade 53 and above, it is not to be used in ordinary structures where concrete
grade 20 is normally adequate. The total de-controls and competition amongst
manufacturers and the market forces have actually eliminated 33 grades in the
market. It may be necessary to enforce the partial regulation or self-discipline
among the manufacturers of cement to produce at least 1/3rd of the cement in the
OPC category as grade 33 cement and 1/3rd another as grade 43 cement and
balance 1/3rd as grade 53 cement and partially regulate the price for these 3 grades
so that, in the market 33 grade cement will become available to the common
consumer. Though originally introduced to save energy in the cement plants and to
make use of the available industrial by products, research and experience have
shown that blended cements have more durability characteristics than the OPC of
even higher grades. Cement is primarily used to produce concrete. Concrete is
mainly produced in ready mixed plants the world over. Most of the producers of
the concrete use OPC and a substantial quantity of cementations materials like
pozzolana or granulated blast furnace slag. In countries like U.S. and U.K. where
90 percent of the concrete produced is in the ready mixed plants and the
cementations materials are blended in the concrete plants rather than in the cement
manufacturing units. In India ready mixed concrete has just had the beginning. The
blending of cementations materials at site is not advisable now. Hence, blended
cement production is very essential. At present production of blended cement is
around 30 percent. This has naturally to increase to at least 50 per cent. The
blended cement does not gain strength immediately and also do not generate heat
like OPC. Hence, the common belief has been that blended cement is inferior
cement. Actually it is not so. No doubt, the rate of gaining strength is slow in the

case of blended cement. But, ultimately, in the long run it gains as much strength
as any OPC. Blended cements give better workability in fresh concrete and during
the hardened stage, give better durability. The consumer is to be adequately
educated on the advantages of blended cement. The reluctance on the part of
builders to opt for blended cement is to an extent justifiable because many builders
were forced to use PPC when the production of PPC was as high as 76 percent
during the control days. They found to their dismay that they have to retain their
shuttering for much longer duration and sometimes the quality of PPC was of
doubtful nature because the fly ash blended with the PPC was of varying quality.
However, of late, the selection of pozzolanic materials has been more stringent and
the quality of blended cement is more consistent. The builders can shed their past
memories and start using blended cement. Manufacture of blended cement results
in substantial savings in energy and product cost. Hence, industry must pass on to
the consumers the benefits derived to the users of blended cement. In short, every
cement has its own role to play and there is no reason to believe one cement is
superior to the other cement. For ordinary structure.OPC grade 33cement or PPC
could meet the requirements. For producing concretes of higher grades, mixes have
to be designed using OPC as well as cementitious materials concrete chemicals and
sometimes additional fillers and even viscosity agents. For non-structural uses such
as masonry and plastering mortar, cement of much lower strength than OPC 33
grade classified as masonry cement is the best suitable material. But, unfortunately,
no manufacturer produces this type of cement. More than the choice of the cement,
the control exercised in production of concrete in regard to the selection and
proportioning of materials, use of the minimum required quantity of water, careful
handling of the mix during transportation and placing, compacting well to get a
dense concrete, having an engineered formwork, continuous curing and the like
contribute greatly to the quality and durability of concrete.

VARIETIES OF CEMENTS IN NEPAL

There are some varieties in cement that always find good demand in the market. To
know their characteristics and in which area they are most required, it will be better
to take a look at some of the details given below

Portland Blast Furnace slag cement (PBFSC): The rate of hydration heat is found
lower in this cement type in comparison to PPC. It is most useful in massive
construction projects, for example - dams. Sulphate Resisting Portland cement:
This cement is beneficial in the areas where concrete has an exposure to seacoast
or sea water or soil or ground water. Under any such instances, the concrete is
vulnerable to sulphate attack in large amounts and can cause damage to the
structure. Hence, by using this cement one can reduce the impact of damage to the
structure. This cement has high demand in India. Rapid Hardening Portland
cement: The texture of this cement type is quite similar to that of OPC. But, it is bit
more fine than OPC and possesses immense compressible strength, which makes
casting work easy.

Ordinary Portland cement (OPC): Also referred to as grey cement or OPC, it is of

much use in ordinary concrete construction. In the production of this type of
cement in India, Iron (Fe2O3), Magnesium (MgO), Silica (SiO2), Alumina
(AL2O3), and Sulphur trioxide (SO3) components are used. Portland Pozolona
Cement (PPC): As it prevents cracks, it is useful in the casting work of huge
volumes of concrete. The rate of hydration heat is lower in this cement type. Fly
ash, coal waste or burnt clay is used in the production of this category of cement. It
can be availed at low cost in comparison to OPC.

Oil Well Cement: Made of iron, coke, limestone and iron scrap, Oil Well Cement
is used in constructing or fixing oil wells. This is applied on both the off-shore and
on-shore of the wells. Clinker Cement: Produced at the temperature of about 1400
to1450 degree Celsius, clinker cement is needed in the construction work of
complexes, houses and bridges. The ingredients for this cement comprise iron,
quartz, clay, limestone and bauxite.

White cement: It is a kind of Ordinary Portland Cement. The ingredients of this

cement are inclusive of clinker, fuel oil and iron oxide. The content of iron oxide is
maintained below 0.4% to secure whiteness. White cement is largely used to
increase the aesthetic value of a construction. It is preferred for tiles and flooring
works. This cement costs more than grey cement.

PESTLE Analysis of Cement Industry

PESTLE analysis is a useful tool for understanding the big picture of operating and
takes advantage of opportunities. Pest analysis includes political, environmental,
social and technological factors which affects both the companies as well as
industry.
Political :
The price of cement is primarily controlled by the coal rates, power tariffs, freight,
royalty and cess on limestone. Interestingly, government controls all of these
prices. Government is also one of the biggest consumers of the cement in the
country. Most state governments, in order to attract investments in their respective
states, offer fiscal incentives in the form of sales tax exemptions/deferrals
Economic :
The industry is on the boom, with a lot of government infrastructure and housing
projects under construction. The export segment of the industry is expected to
grow again on account of various infrastructure projects that are being taken up all
over the world and numerous outstanding cement plants coming up in near future
in the country.
Social :
The cement industry in Nepal consists of both the organized sector and the
unorganized sector. Organized sector comprises of the well-known cement
manufacturing companies while the main players of the unorganized sector are the
regional and local cement-producing units in various states across the country.
These cement industries have created lot of employment opportunity .These
opportunity increase every year.
Technology :
The Government of Nepal plans to study and possibly acquire new technologies
from the cement industry of world. The government is discussing technology
transfer in the field of energy conservation and environment protection to help
improve efficiency of the Nepal cement industry. Cement industry has made
tremendous strides in technological up-gradation and assimilation of latest

technology. At present 93% of the total capacity in the industry is based on modern
and environment-friendly dry process technology.

POTERS FIVE FORCE MODEL

Porter's Five Forces Model is:
a.

Rivalry among the existing firms

Medium to High

b.

Threat of New Entrants

High

c.

Threat of Substitute Products

Low

d.

Bargaining Power of Buyers

High

e.

Bargaining Power of Suppliers

High

Bargaining power of Suppliers:High

The cement industry is dependent on three major infrastructural sectors of the
economy: coal, power and transport. The inputs from these three sectors account
for roughly 50% of the cost of cement. Both the availability and the cost of these
inputs have a vital bearing on the fortunes of the cement players. As the raw
material required by cement industry are in control of the government, so
government pricing would have an impact. As government largely controls all
these sectors, thus cement companies have no control on the cost and the
availability of these inputs. Suppliers have a low impact in cement industry. As this
would be common to all companies there would be the similar kind of impact on
all the companies in the cement industry.

Bargaining power of Buyers: High

And only 70 percent of the total consumption is being produced in Nepal. Rest is
fulfilling by the import from India. Annual increment of demand for cement in
Nepal is considered to be around 20%. And local manufacture imports some 75%
of clinkers from India. And due to increase in infrastructure development housing
apartment and business complex and also roads, bridges, civil structures tend to
increase demand of cement and also numbers of Hydro Power Projects are in the
pipeline, which consume huge cements. So, bargaining power of buyer is high.
Threat of New Entrance:High
Cement industries is capital intensive which can be the biggest constraint, where
only established business houses like CG, Dugar, Golchha, Triveni, Panchakanya
Groups etc. will have access to. Cement, being a bulk commodity, is a freight
intensive industry and transporting cement over long distances can prove to be
uneconomical which acts as an important constrain to enter the cement industry.
Economies of scale are an important factor of the industry and this will reduce the
cost of cement which would favor the bigger players public sectors as well.
Knowledge to this fact will discourage the new entrant.
High capital costs and long gestation periods is also an important factor for an
entry in cement industry.

Threat of Substitute product: low

As cement is a basic construction material with practically no substitute, it is used
worldwide for all construction work.

Rivalry among the Exiting firms: Medium to High

Out of 59 cement industries that are register in the Department of Industries. Only
32 industries are in the operation which fulfills 70% of the Nepalese market.
But the big corporate house like CG, Panchakanya Group, Golcha Group are likely
to start their operation in few years, if their operation starts then the small cement
industries will have to face high competition.

SWOT ANALYSIS ON CEMENT INDUSRTY

Strengths: Cement is, literally, the building block of the construction industry.
Almost every building constructed relies on cement for its foundation. The cement
business is a US$10 billion industry, measured by annual cement shipments. There
is also a strong reputation behind the cement industry. Cement is a solid material
and consumers rarely have complaints about the product. Regional distribution
plants have also made cement widely available toany type of buyer.
Weaknesses:The cement industry relies on construction jobs to create a profit. But
the cement industry is cyclical in nature and heavily relies on weather. About twothirds of cement production takes place between May and October. Cement
producers often use the winter months to produce and stockpile cement, to meet
demand. Another weakness is the cost of transport; the cost of transporting cement
is high and this keeps cement from being profitable over long distances. In other
words, shipping cement costs more than the profit from selling it.
Opportunities:The cement industries have opportunities as well. One such
opportunity is the cement industrys efficiency. The cement industry has recently
streamlined its production efforts, using dry manufacturing instead of wet, which is
heavier and more time-consuming. Thecement industry has also invested about
US$6 billion in expansion efforts to meet unmet cement needs. Projections show
that by 2012, the cement industry will have 25 percentmore production
capabilities.
Threats:The nature of the economy has uncovered a number of threats to the
cement industry. The cement industry greatly relies on construction. The current
economy has lessened the number of construction jobs, which in turn hurts the
cement industry. Government is trying to regulate the waste coming out of cement
industry and the effect on the environment.

COMPANY PROFILE

Maruti cement ltd. is locatedChandraudaipur, Siraha ,Nepal.The plant has three

units manufacturingclinker and PPC/OPC Cement of 43 & 53 grades as per
standards, published by Bureau of Nepal Standards. The first Unit was
commissioned in the year 2003, the second one in 2009and the third unit in 2013,
with a total installed capacity of 0.9 million Tons per annum(MTPA). The
production capacity has been enhanced to 1.2 MTPA as of now. The cement is sold
in the open market through a well-established network.Maruti Cement has adopted
dry process precalcination technology with sophisticated control instrumentation
from internationally renowned firms like KHD Humboldt Wedge AG of Germany
for ensuring consistent quality of cement. The Company is committed to Total
Quality using highly sophisticated state-of-art technology and has taken the lead in
the country for Energy Conservation by installing High pressure Roller Presses for
raw material land cement grinding, 6 Stage Pre-heaters and Trip late cyclone. The
organization has attached utmost importance to the conservation of environment in
and around its Industrial complex by installing highly efficient electrostatic
precipitators and dust collectors.
Following facilities are installed/available in the organization:
i)
ii)
iii)
iv)
v)
vi)
vii)
viii)
ix)
x)
xi)
xii)
xiii)

Captive Power Plant of 58.2 MW capacity

Leased Limestone Mines
Limestone Crusher, Stacker and Reclaimer
Coal Mill with Crusher and Pulverization
Raw Mill: Ball Mills with Roller Press
Raw Meal Silone
Pre-heaters
Kiln & Cooler
Cement Mill: Ball Mills with Roller Press
Cement Silos
Packing Machines (Rotary Packers)
Bulk Cement Loading Silo
Fly-ash storage

The major raw-materials are Limestone, Coal, Gypsum, Literate, Bauxite

and Fly-ash. The limestone is available in-house through leased mines
(total lease area 400 acres, Limestone reserve up to 35 meter depth 35
million Ton. The other suppliers are technology/spare parts suppliers who
play a vital role in producing quality cement. The organization maintains
a very cordial relationship with them and they are regularly invited for
seminars and for joint participation in improvement activities. The key
quality requirements of customers are strength of cement and setting
time. It may be noted that the organization is consistently supplying the
cement of higher strength compared to strength mentioned in standards.
As a result, the brand enjoys the premium status in the market.

Vision
Our vision is to be a market leader in cement business and recognized as the bench
mark for:
customerisation
quality consistency
product range
cost competiveness

employee empowerment
To be a premium global conglomerate with a clear focus on each business.

Our Mission

We are committed to being the industry leader in providing outstanding valve to

our customers ,a safe and stimulating work environment for our employees and
superior for our shareholders.

Companies critical success factors

Growth strategy
Customer satisfaction
Community involvement
Teamwork
Employee satisfaction
Measurement systems
Commitment

ENVIROMENTAL COMMITMENT

Maruti cements ltd. Is firmly committed to preserve and protect the environment.
This commitment allows safe working and living conditions for employees and
residents in our commitment .we comply with strict regulation to maintain a high
friendly environment.
It has investment a considerable amount in environmental protection systems and
equipment. This is reflected by our achievement in global pollution norms and we
are certified as the only plant in Nepalwith both ISO2001-Quality Management

system and ISO14001-Enviroment Management System. MCL remains dedicated

to help make our community a better place to live and work.

MANAGEMENT
Nand Kishore Rathi
Mr. Nand Kishore Rathi, is the Chairman and Whole Time Director of our
Company. He has established himself as a successful self-made entrepreneur in
both industry and commerce. He is a man of amiable nature, coupled with a
resolute mind and farsightedness. He has built up a formidable reputation in the
industry. He has headed various business and social organizations. He is also a
promoter in NMB Bank, Kumari Bank.
Sunil Khemka
He is a prominent industrialist and has been the main driving force behind the
technical excellence and commercial success of this cement project, which
manufactures 1800 tpd of cement through a dry process, rotary kiln based plant. He
has three decade of vast experience in the cement industry. His first hand
involvement in the aforesaid project, right from inception, has proven to be an
asset to the company. He is the Managing Director of Maruti Cements Ltd
Din BandhuGoyal
MrGoyal is a successful industrialist and renowned philanthropist and has a
distinguished career spanning 25 years. He is a prominent industrialist with
interests in lubricants, cement, BPO and petrochemicals. He has also promoted
MCL. He actively supports many social and educational organizations.
AnujRathi
Is a young second generation entrepreneur. He has done his Masters from FMS,
Delhi and is the alumni of SRCC, Delhi University and Mayo College, Ajmer. He
brings fresh ideas and perspectives into daily operations
.

SharadGoel
Mr. Goel holds a Bachelors degree in Commerce from Delhi University and a
Masters degree in Business Administration from Symbiosis College, Pune. He is
responsible for the marketing activities of the company.
The promoters bring a combination of financial strength, experience in the line of
activity, experience in operating in the region and a very strong marketing
network.
Process
Our product process is supported by strict process and product quality control. A
passion for accuracy ensures that the line of operations in our plant is at par with
strict local and international standards.
The process uses high grade limestone that in return gives us high grad Ordinary
Portland Cement (OPC).
Advanced technology methods are used to ensure that a high level of quality is
attained and sustained right through the manufacturing process. Yet, these high
standards are constantly improved upon by an experienced and dedicated technical
team to attain performance oriented cement.
The optimum ratio of raw mix is attained by the use of on-line analyzers and
automatic weigh feeder which are linked to the centralized computers
control room.
Reduced variability in Kiln feed and complete homogenization of raw meal
is attained through Continuous Flow Silo. This ensures that every grain of
cement is of consistent quality.
The totally computerized monitoring system enables quality clinkerization.
It dictates the optimum retention time in the kiln. Equipped with a five stage
pre-heater cyclone system, and soon to be commissioned precalciner shall
only add to the quality.
The modern closed grinding units have a high efficiency separator those
produces finer particles of cement. This yields cement matrix with a lower
pore diameter. This in turn gives concrete of higher density and lower
permeability.

ORAGANISATIONAL CHART OF CEMENT PLANT

CEMENT PRODUCTION PROCESS

ANALYSIS AND INTERPRETATION

Data Analysis The data after collection has to be processed and analyzed in
accordance with the outline laid down for the purpose at the time of developing the
research plan. This is essential for a scientific study and for ensuring that we have
all the relevant data. Processing implies editing, coding, classification and
tabulation of collected data so that they acquiescent to analysis. The term analysis
refers to the computation of certain measures along with searching for patterns of
relationship that exists among data groups. Thus in the process of analysis,
relationships or difference supporting or conflicting with original of new
hypothesis should be subjected to statistical tests to significance to determine with
what validity data can be said to indicate any conclusions. Analysis of data in a
general way involved a number of closely related operations that are performed
with the purpose of summarizing the collected data and organizing them in such a
manner that they answer the research questions.

What is brand?
A brand is a product, service, or concept that is publicly distinguished from
other products, services, or concepts so that it can be easily communicated and
usually marketed. A brand name is the name of the distinctive product, service, or
concept. Branding is the process of creating and disseminating the brand name.
Branding can be applied to the entire corporate identity as well as to individual
product and service names.

Branding
Branding is a disciplined process used to build awareness and extend customer
loyalty. It requires a mandate from the top and readiness to invest in the future.
Branding is about seizing every opportunity to express why people should choose
one brand over another. A desire to lead, outpace the competition, and give
employees the best tools to reach customers is the reasons why companies leverage
branding.

Brand Name
The brand name is very significant choice because some time it captures the central
theme or key association of a product in a very condensed and reasonable fashion.
Brand names can beextremely successful means of communication. Some
companies assign their product with a brand name that in reality has nothing to do
with the emotional experience but is catchy and a name that people can easily
memorize. The core base of naming a brand is that it should be unique, can be
easily discriminated from other names, easy to remember and are attractive to
customers In our opinion people have strong connection to brands and brands
name.

Consumer Decision making

The consumer decision making process defines different steps when a
consumer goes through to purchase a product. If customer wants to make a
purchase he or she takes a sequence ofsteps in order to do complete this purchase.
Problem recognition includes when consumer feel asignificant difference between
the current state and ideal so consumer thinks there is some problemto be solved.
The problem may be small or big. In the second step, the consumer seeks
informationabout the product. The extent of information search relies on the level
of consumer involvement. Incase of expensive products, the level of involvement
is high. Conversely, in case of relatively cheapproducts the level of involvement is
usually low. In the third step, the consumer evaluates thedifferent attributes of the
brands. Consumer may consider the product attributes and compare brandproducts.
In the final step consumer makes his choice about a product.

Its true that a consumer may not necessarily go through all the decision
making steps for every purchase he or she makes. At times, consumer makes his or
her decision automatically andthe decision may be based on heuristics or mental
shortcuts. Other times, in case of highinvolvement products consumer may take a
long time before reaching a final purchase decision. Itdepends on consumers
importance of the products like purchase of a car or home.

1.Have you purchased Maruti cement?

Parameters

YES

NO

TOTAL

No of respondents

65

35

100

100

Serie
s1
70
60
50
40
30
Series 1
20
10
0
YES

NO

Interpretation:
As given in the pie chart 65 % percent of the respondents have used Maruti cement
before, where as 35 % of the respondents have not used or purchased Maruti
cement before.

2. If yes how did you know about Maruticement?

Parameters
Tv commercial
Dealer and whole salers
Engineer
Builder

No. of respondents
40
20
25
15

%
40
20
25
15

Responde
nts

tv
dealer
engine
er
builder

Interpretation:
As given in the Bar graph 40% of the customers respondents they got information
about Maruti cement from T.V. COMMERCIAL and 20% of the customers got
information about ci cement from DEALER,25% of the customer got information
about Maruticement from ARCHITERCURE/ENG/ information about Maruti
cement from builder.

3.What are the influencing factorsof yourpurchase?

Parameters
Price
Quality
Convince
All of the above

No of respondents
20
60
15
5

%
20
60
15
5

Influencing factors
70
60
50
40
30
Influencing factors
20
10
0
Price

Quality

Convince

All of the above

INTERPRETATION:
As given in the pie chart 60 % of the customers preferring Maruti cement for its
better quality, 15% of the customers preferring Maruti cement for its convenience,
5% of the customers preferring Maruti cement for purchased Maruti cement for
its all quality and 20% of the customers preferring Maruti cement for its price.

4. Are you satisfied withMaruticement ?

Parameters

No of respondents

Yes

90

90

NO

10

10

Sal
es

Yes
NO

INTERPRETATION:
As given in the pie chart 90% of the customers are satisfied with the Maruti cement
and 10% of the customers are not satisfied with the Maruti cement.

5.Do you think convenience is a matter?

Parameters
Yes
No

No of respondents
80
20

%
80
20

convenien
ce
90
80
70
60
convenience

50
40
30
20
10
0
Yes
No

INTERPRETATION:
As given in the graph 80% of respondent think convenience is important, where as
20% think it does not matter.

6. Maruti cement is not convenience to you than will you shift to any other
brand?

Parameters
Yes
No

No. Of respondents

95

95

Sal
es

yes
no

INTERPRETATION :
As given in the pie chart 95% of the customer respondents they want to change
their brand as per their convenience and 05% of the customersrespondents
theydont want to change their brand.

7. Are you satisfied with the price as per the quality?

Parameters

No. of Respondents

Yes

90

90

No

10

10

100
90
80
70
60
50

Series 1

40
30
20
10
0
yes

no

INTERPRETATION :
As given in the pie chart 90% of the customers respondents they are satisfied with
the price as per quality of Maruti cement and 10% of the customers respondents
they are not satisfied as with the price as per quality Maruti cement.

8.If yes, Do you think the quality is better as compared to other brand?

Parameters

No of respondents

Yes

90

10

No

10

10

brand
100
90
80
70
60
50

brand

40
30
20
10
0
yes
no

INTERPRETATION:
As given in the pie chart 70% of the customers respondents the quality is better
than as compared to other cement company and 30% of the customers are
respondents the quality of MARUTI cement is not better as compared to the
competitors.

9.Is it reliable as compared to competitors?

Parameters

Number of respondents

Yes

70

70

No

30

30

COMPETITOR COMPARISON
70
60
50
40
COMPETITOR COMPARISON
30
20
10
0
yes

no

Interpretation:
As given in the graph 70% of the customers respondents the Maruti cement is
reliable as compared to the competitors and3o% of the customer respondents
theMaruti cement is reliable as compared to the competitors.

10.Out of 5 which rank you want to give to MARUTI CEMENT?

No of Respondents Percentage

Parameters
good
better
Avg.
bad
No reply

40

40

15

15

30

30

10

10

ran
ks

1st Qtr
2nd Qtr
3rd Qtr
4th Qtr

INTERPRETATION
As given in the Bar graph 40 of the customers respondents the Maruti cement is
GOOD, 15 customers respondents its BETTER,30 customers are respondents its
AVERAGE,5 customers are respondents its BAD and 10 customers are not
responds.

SUMMARY OF FINDINGS
Despite the increasing cost of the raw material the company is able to bring down
the cost of the manufacturing through procurement of raw materials by the mines
which are located nearby. Customers come to know about MARUTI CEMENT
mainly from hoardings many people are illiterate. Customers want more prizes and
dealers want more incentives, gift and tours. Dealers also want more meeting with
officials of the cement companies. Bulk consumers want more and more cash
discount.

RECOMMENDATIONS
The company should concentrate on more aggressive advertisement to promote
their products. The company should launch more and more promotional schemes
like two for the price of one or more discount coupons. Company should do more
to promote their brand as customers prefer good brand while buying any cement.
Customer prefer price as an important factor while buying any cement so the
company should fix the price accordingly.
CONCLUSIONS
Company should concentrate on direct meeting with the customer as they are the
most vital element in deciding the growth or decline of any company. Company
should decrease the response time to the complaint received. The company should
fix certain amount of cement especially for the dealers and give them free of cost
as incentives. The company should appoint more and more persons for the
promotions of the brands. Company should decrease delivery time of the cement.

Q.Have you purchased MARUTI CEMENT ever?

YES [ ] NO [ ]
Q2.IF YES, How did you come to know about MARUTI CEMENT?
A. TV commercial
B. Archi/Eng
C. Dealer/wholesaler
D. Builder
Q3.What are the influencing factors for your preferences?
a. Price
b. Quality
c. Convenience
d. All of above
Q4.Are you satisfied with MARUTI CEMENT?
Yes [ ]

No [ ]

Q5.Do you think convenience is matter?

YES [ ]

NO[ ]

Q6.IF the MARUTI CEMENT is not convenience to you than will you shift to
other brands?
YES [ ]

NO [ ]

Q7. Are you satisfied with the price as per the quality? YES [ ] NO [ ]

Q8.IT is reliable as compare to the competitors?

YES [ ]

NO [ ]

Q9.IF YES, Do you think the quality is better as compare to the competitors?
YES [ ]

NO [ ]

Q10.Out of 5 which rank you want to give to the MARUTI CEMENT?

a.GOOD
b.BETTER
c.AVERAGE
d.BAD
e.NO REPLY