Marketing Strategy of Partex Furniture

PARTEX GROUP

Report on Marketing Strategy of Partex Furniture A Study on Partex Furniture Industries Limited

www.AssignmentPoint.com

www.AssignmentPoint.com

PARTEX GROUP

Table of Content Sl 1 2 3 4 5

6

7 8 9 10

Subject Letter of Transmittal Certificate of Supervisor Acknowledgement Executive Summery Introduction: a. Origin of the report b. Problem & Purpose c. History d. Scope e. Limitations f. Sources and Methods of collect g. Initialize and acronyms Company Overview: a. How to started b. Vision c. Values Main Furniture Companies in Bangladesh a. Name of the Companies

11

Segmention, Targeting & Positioning (STP) of Partex Furniture Summary of Marketing strategies Internal Analysis of Partex Furniture: Assessing Strength and Weakness for PARTEX External Analysis of Partex Furniture: Assessing Strength and

12

Weakness for PARTEX Business Level Strategy

13 14 15 16 17 18 19

Functional Level Strategies Corporate Strategy Strategy in Global Environment for the Company Problems finding Recommendation Conclusion Bibliography

www.AssignmentPoint.com

PARTEX GROUP

Executive Summary Partex furniture Industries Limited is a growing company in furniture industries of Bangladesh, it almost has gone the market leader position in Partex board and upper class wooden furniture. Its mother concern is star particle board supplies the product all over the country. Partex furniture produces two types of board such as; laminated board and Partex board. Laminated board: The raw material of LB is cheeps of wood. The lamination paper (melamine paper, pvc and normal paper) which imports from abroad is attached into upward and backward both side of the board and the bits of this board are covered by edging. Partex board: Raw material of this board is cheeps of solid timber. It is made high technological machineries. Wooden furniture: The wooden furniture is made by Furnitex board which is attached with the veneer. The whole frame of the product is wood and the body is made by Furnitex board besides many wooden furniture are made by traditional way which is made by pure wood. This report is divided into three parts, the introduction part, organization part and conclusion. The introduction part discusses origin of the report, history, Vision, Mission, Values, etc. the organizational part describes the corporate structure of Partex Furniture Indus. Ltd. and the Conclusion part discussed over all findings, recommendation.

www.AssignmentPoint.com

PARTEX GROUP

Introduction: a. Origin of the report: this report is development as a course of the MBA program. When I have presented my report to my supervisor, he will authorize my report. This report is written by me under the supervisor Md. Shahin Ahamed Chowdhury. b. Problem and Purpose: My corporate purpose is state that to succeed the problems and pattern statement of Partex Furniture. But the whole information about Partex Furniture as like what is working system how is its management system and etc. are not clearly given on its website. c. History: Partex Furniture is a leading manufacturing furniture, brought revolutionary changes in the furniture market in our country since its start 2000 and owned by Mr. Aziz Al Kaiser. First it had started in a small scale, but today Partex Furniture is fully equipped with latest technologies. h. Scope: Partex Furniture is a world class furniture providing company, has a big functioning network of its business in our country and other country. It has several Gallery and Branches. I have tried to cover about marketing strategy of Partex Furniture. i. Limitations: For the want of the proper data and reliable resources I can not include the financial information in this report. j. Sources and Methods of collect: I have collect the information from the Secondary data, such as: Companies journal, brochure, articles, websites and Monipuripara Gallery.

www.AssignmentPoint.com

PARTEX GROUP

A

combination laminated

of

special

board,

imported

stainless

steel

accessories and high standard plywood offers natural timber for custom-made innovative, modern and stylish furniture. PARTEX Furniture produces a diversity of products maximizing the use

of

timber-substitutes

as

well

as

products of solid timber. Within a short span of time laminated board furniture has been able to claim a sizable portion of the market. This is a commitment of PARTEX GROUP to use ecofriendly

materials,

as

much

as

possible.

Currently, we are providing an ever-increasing range of products to meet the greater than ever

demand

of

furniture

for

households,

offices and educational institutions.

________Partex Furniture’s Vision

www.AssignmentPoint.com

PARTEX furniture

the best quality and cost effective substitute for

SYMBOL OF ELEGANCE, BEAUTY & INNOVATION

How to started:

PARTEX GROUP

VISION e are the leading furniture solution provider in Bangladesh achieving our business vision through growth in market reach, increasing operation size, international distribution, total service and consistent branding activities by the being most customer focused & Innovative, cost effective & efficient, environmentally responsible & quality concerned company in the business.

W

MISSION o be the most consumer-focused, competitive, efficient, innovative, and environmentally responsible and quality concerned leading market oriented furniture manufacturer, sales and distributor of Bangladesh.

Values______________________

1

CUSTOMER FOCUSED & INNOVATIVE We believe our success depends on our customers. Thus, our primary value is fulfillment of our customer's needs. Our manner of achieving this success is to include value for money, different price ranged functional products, complete solutions, free technical consultancy services, after sales support, efficient delivery, and above all quality products that exceeds expectations. We believe in providing our customers new and innovative products with international standards to match wit the changing lifestyle of today.

COMPETITIVE & EFFICIENT

2

We believe our competitive nature thoroughly ensured as when we provide highest quality products in the most perceived prices. We are committed to our value in relationship with our stakeholders where our core product is associated with efficient and reliable services.

www.AssignmentPoint.com

PARTEX GROUP

3

4

ENVIRONMENTAL STEWARDSHIP & EXCELLENCE IN QUALITY We believe in maintaining, operating our business in such a manner so that it is sustainable for the future. We want to combine economic use of wood and create wood substitute products for our furnishing needs and constantly devote our production, research & development to remain environmentally responsible. We are committed to find new methods and technologies to improve our services. We believe excellence is our only standard for all our approaches.

INTEGRITY We are committed to conduct our business in such a way that demonstrates highest ethical standards. We believe integrity is our imperative utility to succeed in what we do.

www.AssignmentPoint.com

PARTEX GROUP

Main Furniture Companies in Bangladesh: 1. Name of the Companies: a. OTOBI Ltd. b. Partex Furniture c. HATIL d. Navana Furniture e. Akhter Furniture f. Brothers Furniture g. Legacy

Source: Bangladesh Furniture Indus. Owners Association Report -2010.

Segmentation, Targeting & Positioning (STP) of Partex Furniture: www.AssignmentPoint.com

PARTEX GROUP

Segmentation: PARTEX Furniture Industries Ltd products international quality furniture. A combination of special imported laminated board, stainless steel accessories and high standard plywood offers the best quality and cost effective substitute for natural timber foe custom made innovative, modern and stylish furniture. PARTEX Furniture produces a diversity of products maximizing the use timber substitutes as well as products of solid timber. Partex Furniture segregates its product with individual care wise. Such as:

Targeting:

The

www.AssignmentPoint.com

PARTEX GROUP

Sky is not the limit for Furniture Market but expectation is within limits. Therefore, our imagination soars beyond conventional barriers. We share or destiny with our beloved motherland. We want to serve her in the greater quest for national uplift. Partex Group is committed to the prosperity of Bangladesh. Our enterprises play a positive role in alleviating poverty and generating employment an important objective of our country. This has been possibly through continuous customer support and loyalty which we are proud. We endeavor to reach our products and services at the client's doorstep through a network of sales and distribution outlets. Human resources is our key asset, who translate the group's objectives into realistic performance. We are committed to have the best people and train them to get the best from them. Ours is a free market economy, where private sector plays a key role in establishing an industrial base. We believe in new ideas and technology which the road to the future. We shall travel this road hand in hand with our customers and our employees to seek and find prosperity for the Group and the country. We are the leading furniture solution provider in Bangladesh achieving our business vision through growth in market reach, increasing operation size, international distribution, total service and consistent branding activities by the being most customers focused & Innovative, cost effective & efficient, environmentally responsible & quality concerned company in the business. To be the most consumer-focused, competitive, efficient, innovative, and environmentally responsible and quality concerned leading market oriented furniture manufacturer, sales and distributor of Bangladesh.

Positioning: Positioning or Market Share: Per year: a. b. c. d. e. f. g.

OTOBI Ltd. – Partex Furniture Hatil Furniture Navana Furniture Akhter Furniture Brothers Furniture Legacy -

500 Crore/ Year 100 45 40 20 15 10

It is clear that Partex Furniture is in the second position in the Furniture market of Bangladesh.

Summary of Marketing strategies www.AssignmentPoint.com

PARTEX GROUP

Pricing

Developing Quality of a product

Strategy

Promotion

Marketing Mix ‘The set of controllable

tactical marketing toolsproduct, price, place and www.AssignmentPoint.com promotion.’

Distribution

PARTEX GROUP

4P’s

4C’s

Product

Customer solution

Price

Customer cost

Place

Convenience

Promotion

communication

The Process of Marketing Understanding the market place needs the wants

Designing a customer driven marketing strategy

Build profitable relationship

Construct as integrated marketing program

Capture value from customer in return

www.AssignmentPoint.com

PARTEX GROUP

www.AssignmentPoint.com

PARTEX GROUP Corporate-Level strategy Partex has vertically integrated both into the Panel-based and timber-based furniture industry because of their strength in raw material supply. Because of vertical integration, Partex enjoys some competitive advantage compared to its competitors. 

Partex has invested Tk.100 crore in the furniture industry and this huge investment acts as an entry barrier to its potential new entrant.



Partex will also be able to realize Economies of scope since they are fully integrated in the furniture industry i.e. from producing raw materials to distributing them.

Thus the two SBUs in the furniture industry: one is timber based furniture and the other is panel based furniture Business-level Strategy: Interestingly enough the generic strategy for Partex is not ‘Cost Leadership and Differentiation’ rather it is differentiation (not pure differentiation) backed up by absolute cost advantage. The result is Premium price charged for products similar to the competitors and obtaining lower cost than pure differentiators and higher levels of profits than firms pursuing only one of the generic strategies.

www.AssignmentPoint.com

PARTEX GROUP Functional-Level Strategies 1. MARKETING Always tries to pursue new product development focusing on quality, design and customer needs, providing feedback to both customers and specialized functions, in order to expand their market.

2. RESEARCH & DEVELOPMENT Depends

mainly

on

customer

feedback

for

new

product

development

and

communicates this to other functional areas, such as production 3. PRODUCTION Concentrating on reaping most benefits out of panel based furniture due to low leadtime, automation and sound vertical integration. At the same time, inefficiencies in timber-based furniture are attempted to be countered with high design and craftsmanship quality and doing batch processing to minimize costs.

Global-Level Strategies

It is not planning to put any manufacturing set up in the host country. Partex will manufacture its products exclusively in the home country. As Partex’s current targeted foreign market is UAE it has low pressures for Cost Reductions. Pressures for Local Responsiveness are low as well.

www.AssignmentPoint.com

PARTEX GROUP

Internal Analysis – Summary Administration Corporate Structure

Strengths  Top level Decision Making with

Weaknesses  Complex structure- difficult to

vast information seeking from low

understand

level managers (take inputs)  



Centralized DM Poor understanding of the structure by the mid level managers Present structure hampers successful growth in the future

Corporate Culture Strengths  Consistent culture 

Weaknesses  Family Owned business concept

Emphasis on quality,



very prominent Promotion only up to a certain

craftsmanship and design and

position, which may be de-motivating

integrity is maintained about this

to the employees. Short corporate ladder



Customers are not refused, with a



certain limitation of the company

www.AssignmentPoint.com

PARTEX GROUP Marketing

 

Wide range of customer base The corresponding strategy is to focus on quality first and then



respond to demand Planning many programs for





growth Programs consistent with



corporate mission

Planning many programs but not clearly stated, merely implied Positioning by high quality product at affordable prices. Therefore product mx needs to be suited for





each income group No past trends to base its judgments or strategy formulation – but can be countered with good research and forecasting

Business Development Strengths  Technologically advanced in terms

Weaknesses  Research is mainly observational



of developing new products Cost and quality can be controlled

and participatory 



as they are already in the supply side Consistent with mission and



values

www.AssignmentPoint.com

PARTEX GROUP Operations Strengths  capability to produce imported RM

Weaknesses  initial research suggested that

for panel-based furniture currently

there is demand in this business but

imported

partex did not plan its entry to take



BMRE



advantage of its full potential. Programs and plans merely



automated system for CKD



implied and not clearly stated current situation is not consistent



approach vertical integration gives



with missions, objective etc.



competitive advantage Capacity planning possible in





panel based furniture own supply channel ensures





smooth flow of RM labour and technical teams ensure





quality and design forecasting can be done in relation



demand fluctuations have been

to the followng factors about the

taken as a problem factor preventing

demand cycles

capacity planning

Human Resource Strengths  consistent with missions, as

Weaknesses  These policies are not stated



employment is generated Training provided in a regular



clearly only merely implied



basis Low employee turnover



External Analysis – Summary Five factor model

www.AssignmentPoint.com

PARTEX GROUP Opportunities  Intensity of Rivalry  Due to the size of Partex, the

Threats 

business can expect lower intensity of

Brand image pioneered by Hatil and Otobi – Partex not the pioneer



rivalry Currently in an oligopoly



Timber based furniture industry is in



possibility for being highly



mature stage High capital investement leading to

consolidated in the future due to its size, investment and integration The brand furniture is growing Demand is increasing every year by 

high exit barriers  

15%.  

The main forces in the market are





differentiated No prominent labour union leading to





low exit barriers Layoff cost is low leading to low exit





barriers The group is not so dependent in the



furniture business leading to low  

barriers to entry Threat of potential competitors Partex already has a brand image



Otobi and Hatil already have brand loyalty in panel based furniture

 

Absolute cost advantages Advantage over economies of scale

 

and experience curve effects in panel  

based furniture High capital requirements for entry Chairman being the member of the Parliament can forecast regulatory



Economies of scale and experience curve effects are not present in timber based furniture

 

The market is a free market and open to any new entrants.

changes better than competitors. The current differentiation strategy of Partex strong enough to bar both new

 

and existing competition. Partex gauges expected retaliation  Threat of substitutes Close substitutes are not performing

www.AssignmentPoint.com

PARTEX GROUP in the same market segment 

Business-Level Strategy Principal Issues Partex’s Strategic managers plan of action for using the company's resources and distinctive competencies to gain a competitive advantage over its rivals in the local market is based mostly on its cost advantage over the competitors. At the heart of the generic business-level strategy for the company lie the choices concerning product differentiation, market segmentation, and distinctive competency. These issues of Business level strategy formulation according to Partex are discussed below: The differentiation of furniture according to the need:

www.AssignmentPoint.com

PARTEX GROUP The study on Partex’s product offerings connote that the company follows two different strategies for both Panel-based (Knockdown) furniture and Timber-based furniture. These current strategies are as below: Current Product Differentiation Issues: Types of Furniture Panel-based

Issues for product differentiation This type of furniture is targeted to satisfy special category of needs: office furnishing, kitchen and home appliance, lower middle class home furnishing by offering low-priced products. However, selected customization of these products is also offered allowing minor differentiation for upper middle to higher economic classes in the local

Timber

market. This type of furniture offers uniqueness through the product’s appeal to the consumers’ psychological needs: such as brand image and perception of Partex

furniture being high-end product. Recommended Differentiation Issue: The capacity and the market forces suggest that the current strategy is sufficient for Partex to continue in the industry. The Segmentation of the furniture market: Partex management grouped their consumer in terms of the income-based classification and preferences. The segmentation is unusually large and looks apparently unrealistic to allow Partex to gain competitive advantage. However, due to the nature of the business of two types of furniture, the target group is bound to be relatively larger. The current segmentation strategy is followed for both panel and timber based furniture market. Current Segmentation Issue: The current segmentation strategy of Partex for both of its product line: Panel-based and timber-based is a broad range – ‘Lower middle’ class to the ‘upper upper’ class of the economic division of the Bangladeshi market. Recommended Segmentation Strategy: Types of Furniture Panel-based

Issues for segmentation ‘Lower middle’ to ‘Upper upper’ class as panel based furniture consumer can be targeted for: 

Office furnishing.

www.AssignmentPoint.com

PARTEX GROUP 

Timber

Kitchen furnishing with customization.

 Home furnishing for ‘lower middle’ class. Timber based furniture with the new conception of brand furniture is suitable for the ‘upper middle’ to

the upper end market with focus on appeal. Distinctive competency for the business-level strategy: As previously discussed Partex current distinctive competency is focused on: Current Distinctive Issue: Focused on continual product quality Partex strives to reach for better customer responsiveness through a clear focus of the market trends and new product innovation by newer designs. This organization of distinctive competencies includes superior efficiency in production for the panel-based furniture but does not entail for the timber-based furniture. This is however not a weakness, rather a characteristics for the timber-furniture industry. Recommended Distinctive Issues: Since Costs-Leadership is followed is Panel-based furniture the corresponding distinctive competencies should ideally be in the field of manufacturing and material management. Similarly, for timber-based furniture following a differentiation strategy should ideally have R&D sales and marketing as its distinctive competency. Partex fulfills both these criteria. The choice of the Generic Business-level strategy Partex enjoys a distinctive production development within the system as the raw materials for its panel and timber-based furniture both come from the single source. As a result the company manages to reap gains from cost advantage as well as brand image and appeal, leading to differentiation strategy. Current Business-level Strategy: Interestingly enough the generic strategy for Partex is not ‘Cost Leadership and Differentiation’ rather it is differentiation (not pure differentiation) backed up by absolute cost advantage. The result is Premium price charged for products similar to the competitors and obtaining lower cost than pure differentiators and higher levels of profits than firms pursuing only one of the generic strategies. Recommended Business-level Strategy: Outwardly, the Generic Strategy for Partex may seem to be a stuck in the middle as no pure strategy is followed and as a result wrong resource allocation decision may

www.AssignmentPoint.com

PARTEX GROUP occur leading to a loss of control in the generic strategy. However, the cost advantage achieved by vertical integration and the image of Partex brand helps the company to be in a position where it can charge premium price for the product, which has differentiation ability. Thus, the recommended strategy should be: Types of Furniture Panel-based Timber

Cost

Leadership

Generic Strategies and Differentiation

as

competitors

(OTOBI) follows Differentiation strategy as well. Differentiation (not pure differentiation) Strategy with absolute

cost

advantage

gained

from

production

development and vertical integration. The choice of Investment Strategy The appropriate strategy in the growth stage is to provide base to face the shakeout period. For Partex having a strong competitive position in the market the investment strategy should be to expand or growth. Current Investment Strategy: Partex is investing resources to develop new sales and marketing strategy. The new show room (Partex Gallery) and the plan to employ architects in the sales force is an example to this strategy implementation. Also the investment of TK 100 crore is a strategy to build resources that the company is following now.

Recommended Investment Strategy: Aside from following the current strategy Partex should also engage in R&D to maintain their lead as a differentiator and introduce newer designs to capture more market share. The Recommended Business-Level Strategy Partex should follow two different Business-Level strategies for Panel and Timber furniture market. More narrow Segmentation should be focused with differentiation Strategy (not pure differentiation) for Timber furniture and Cost Leadership in Panel Furniture backed up by the cost advantage achieved from vertical integration in both the fields. Finally, investment should be made to capture more market share by innovation and further growth. This will increase the profit margin in even higher extent.

www.AssignmentPoint.com

PARTEX GROUP

Functional Level Strategies 1. MARKETING Marketing & efficiency



Pursuing quality, customer needs and design research



Showroom situated at a poor location



TV media not yet utilized



Only one outlet as of now



Pricing strategy inconsistent with stated objectives and actual implementation

www.AssignmentPoint.com

PARTEX GROUP Marketing & quality

Marketing & innovation



Very customer focused



Provides customer feedback on quality



Provides results of research to business development function



Always pursuing new products

Marketing & customer



Customer focused (knows customer needs etc.)

responsiveness



Communicated customer feedback to appropriate functions

CURRENT STRATEGY: Always tries to pursue new product development focusing on quality, design and customer needs, providing feedback to both customers and specialized functions, in order to expand their market. RECOMMENDATION: Enhance aggressive marketing through consistent pricing perceptions within customers, having more outlets, and pursuing other media to promote

Demand forecast

2. RESEARCH & DEVELOPMENT R & D and efficiency

Focusing only on new products which are not



necessarily easy to produce R&D and quality



Product design based on what is wanted by customers – not based on manufacturing ease

R&D and innovation



Develops new products but process innovations low



Cooperation with other functions done

www.AssignmentPoint.com

PARTEX GROUP

R&D and customer



Involves customers in identifying their needs

responsiveness CURRENT STRATEGY: Depends mainly on customer feedback for new product development and communicates this to other functional areas, such as production RECOMMENDATION: include example Develop products that are needed by consumers but focusing mainly on manufacturing ease and process innovation.

www.AssignmentPoint.com

PARTEX GROUP 3. PRODUCTION Production &



Flexible manufacturing already done for Panel-based furniture

efficiency



No optimal capacity allocation done for timber based furniture



Presence of vertical integration (having own supplier and distributor) enables efficiency

Production &



quality Production &

Long production runs for panel based furniture – making it difficult to judge source of defects



innovation

Ease of manufacturing considered – timber based batch processing



Some innovation in process both for panel and timber furniture

Production &



Customization done but not always with flexible manufacturing

customer



Response time good for panel based furniture b/c lead time low

responsiveness



Response time bad for timber based furniture b/c lead time high

CURRENT STRATEGY: Concentrating on reaping most benefits out of panel based furniture due to low leadtime, automation and sound vertical integration. At the same time, inefficiencies in timber-based furniture are attempted to be countered with high design and craftsmanship quality and doing batch processing to minimize costs. RECOMMENDATION: While concentrating on efficiency the company needs to create task forces to enable flexible manufacturing for timber based furniture.

Corporate Strategy www.AssignmentPoint.com

PARTEX GROUP

Current Strategy Partex has vertically integrated into the furniture industry.

Partex had the upper

hand in producing the particle board which is the raw material to produce furniture and they used to supply this particle board to other furniture-making companies to produce furniture.

But the corporate managers decided that they could vertically

integrate into the furniture industry since they would be producing their own raw material. They also came up with an innovative idea of making use of the unused part of the log which they use for making particle boards.

Partex also has a

widespread distribution network which it can use for the furniture as well. It may be added that Partex has vertically integrated in other businesses as well apart from the furniture industry. For example, under Complex-II Partex had Danish Condensed Milk (BD) Ltd., Danish Food Products, Danish Milk Mills Ltd. Then Partex vertically integrated and came up with Danish Distribution Network Ltd. Because of vertical integration, Partex enjoys some competitive advantage compared to its competitors. 

Partex has invested Tk.100 crore in the furniture industry and this huge investment acts as an entry barrier to its potential new entrant.



Partex will also be able to realize Economies of scope since they are fully integrated in the furniture industry i.e. from producing raw materials to distributing them.

SBUs They have two SBUs in the furniture industry: one is timber based furniture and the other is panel based furniture Timber Based: This SBU is considered as a Question Mark since the relative market share is low, but there is tremendous potential for growth in this industry. This SBU needs a lot of

cash injection which Partex has already done and plans to do the

same in future.

www.AssignmentPoint.com

PARTEX GROUP Panel Based: This is considered to be a Cash Cow. They have a high market share and they are generating positive cash flow for Partex. Drawback of the Current Strategy Partex is finding it very difficult to integrate all their businesses in the industry. In addition, Partex has a very complex structure. Thus their bureaucratic cost is very high. Recommended Strategy Partex should change its current organization structure and make it more simple so that their bureaucratic cost can be lowered which will give them a competitive advantage.

www.AssignmentPoint.com

PARTEX GROUP

Strategy in Global Environment for Partex: Choice of Entry Mode

Exporting

 It is not planning to put any manufacturing set up in the host country.  Partex will manufacture its products exclusively

Strategic Choice

International Strategy

in the home country  As Partex’s current targeted foreign market is UAE it has low pressures for Cost Reductions.

 Pressures for Local Responsiveness are low as well (why???).

Current Situation: 

At present Partex furniture is targeting UAE as their foreign market.



Cost of establishing manufacturing operations in foreign country is being avoided.



Manufacturing only in home country will enable the company to realize substantial economies of scale with added global sales volume (experiencecurve cost economies and location economies).



Moreover, Bangladesh being the home country Partex has the advantage of cheap labor and cheap raw materials (in terms of scrap wood and jute stalk).

Recommendations: 

Should calculate regarding the pros and cons that will be associated with trade barriers of the foreign (host) country.

The company should also carefully verify the transportation costs associated with exporting, and then compare it with possible profit gains.

www.AssignmentPoint.com

PARTEX GROUP

Furniture Industry

Particle Board Based

Wood Based / Veneered Boards

- Plain Particle Board - Vinyl Board - Timber Framed Board - Plytex Ply wood - Lacquered - Flush Door - Aperture Door - Louvre Door - Honey Combed Door

- Burma Teak - White Seder - Champ - Chapalish - Garjon - Mehogony - Other commercial Veneer

COMPETITORS (particle market):

COMPETITORS (Wood market):

Akiz Particles Star Particle Board Mills Limited OTOBI Foreign imported furniture.

HATIL Italian Furniture (imported) PARTEX Group G-Mart

Buyer Power The buyer is the next person downstream in the channel of distribution. Thus the buyer for the subject firm in our case was previously the manufacturer (e.g. OTOBI) while now it is the wholesaler and the final consumer.

The factors that increase a buyer's power are the mirror image of those that increase a supplier's power. Thus buyers have enhanced power: 

When they are concentrated and buy in volume. These conditions give buyers power over small, fragmented suppliers. However, in Partex’s case their Major buyer was OTOBI at a certain level. Now, as Partex is going vertically integrated the buyers’ power is getting reduced as no individual buyer is the prime consumer for the subject company’s product.

www.AssignmentPoint.com

PARTEX GROUP 

However furniture buyers can integrate backward if suppliers cannot offer satisfactory prices. Examples: often consumers chose designs of furniture from galleries and produce them through individual Wood craftsmen.

(Macro) General Environment The general environment is composed of five sectors: Socio-cultural: Society's traditions, values, attitudes, beliefs, tastes, and patterns of behavior, and how they are changing effects the operation of any business. Partex is no exception in this regard. A few variables in General environment is provided below: Technological Environment

Macroeconomic Environment

Biotechnology

Interest rates

Consumer electronics

Exchange rates

Superconductivity

Rotation rates

High-definition television technology

Savings rates

Process innovations (e.g., robotics and minimills)

Trade deficit/surplus

Industrial disasters

Budget deficit/surplus

Political/Legal Environment

Sociocultural Environment

Deregulation

Women in the work force

Relaxed antitrust enforcement

Health and fitness awareness

Environmental protection laws

Erosion of educational standards

Similarity in consumer tastes and preferences

Spread of addictive drugs

Powerful economic alliances

Concern for the environment

Opening of eastern bloc countries

Aging of the population

Third world debt problems

Ethnic composition Maturing of the baby boom generation Regional changes in population growth and decline

Political-Legal Forces: The government of Bangladesh according to the policy it follows allowed an open market scenario in the furniture industry where foreign companies and their products compete side by side. There are no subsidies or cartel on local or foreign products. As a result of this competitive market not many local firms exist in the market. On the contrary, PARTEX being a large conglomerate could thrive even in this market due to its strength in production.

www.AssignmentPoint.com

PARTEX GROUP There is also a protection law for wood logging here in Bangladesh. In addition to this, PARTEX itself is an environment-concerned organization that uses less wood to produce more substitute products. As a result of this, production increment for the furniture industry for PARTEX is not to leap-frog in any one nights stand. Technological Forces: In Bangladesh the use of technologically advanced wood framing equipment is not present. This is primarily because of the nature of the business: wood crafting is highly customized and depends on craftsmanship. Thus over the years skilled craftsman with individualized catering towards a small group of customers have shaped the consumer behavior as well as the nature of the business. The result is technologically not advanced procedure of making wood furniture. However, the production of Particleboards is possible to make in a mass volume. As a result, technological advancement was possible in this sector. Today, PARTEX produces laminated board furniture in a mass volume with high standardization. Also, the technology used in terms of machinery and equipments the company is ahead of its competition, according to the deputy General Managers information.

www.AssignmentPoint.com

PARTEX GROUP

Problems Finding: 1. Production: Production capacity of Modanpur Factory is more than the market demand. 2. Technology: Technology used for the production is not fully automatic, some are semi-automatic. 3. Production Personnel: They have some lack of knowledge about the use of machine. 4. Marketing Reporting: Marketing intelligence report are not systematic and well organized. 5. Sales Analysis: The sales analysis of each product life-cycle is absent; 6. Marketing Research: Marketing research for each product has not been done. 7. Dealer Promoting: Dealer promotion only at commission level has been done; 8. Dealer: Number of dealer is not up to the mark and still so many district are still untapped. 9. Brand Management: Complete brand management is absent for individual brand; 10. Distribution: The distribution process is not Systematic. Flow of distribution is not clear. 11. Outdoor Marketing: There is no plan for outdoor marketing, which is very effective for competitive market. 12. Advertising and Promotion: Advertising and Promotion plan is not well enough for find out untapped market. 13. Information Flow: Information flow between department to department and people to people is very slow. 14. MIS: Management information system is not up to date. 15. Budget: The budget of this company is not enough.

www.AssignmentPoint.com

PARTEX GROUP

Recommendation: 1. After Sales Service: After Sales Service should be provided at all the Show-room. It will save time and effort of the people. 2. Design of some Furniture: Some product design of the company are very traditional. There are so many product similar to our design are now available to our competitor. 3. Drop out slow moving product: 4. More Advertising: To increase the sales advertising on Print media, Electronic media should be increase. 5. Dealer increasing: Dealer should be available in all district. Then I have to find out according to the market potentiality for more than one dealer in the same market. 6. Marketing Plan for Slow Moving Product: Plan for slow moving product such as; Hospital furniture. 7. More Tanning for the officer Level: At present more training is needed about the salesmanship. Market research for find out the target market, dealing product knowledge, product development, marketing product etc. for the salesman and sales personnel. 8. Marketing Research: Market research for each brand has to be done for getting the clear picture for product positioning against the competitor products and finding out furniture. 9.

Budget: The budget will be required to upgrade as its targeted future.

www.AssignmentPoint.com

PARTEX GROUP

Conclusion: It is impossible to have a clear-cut idea of a big company within a short time. But according to my observation this company is suffering from a tremendous problem in following areas, which are the main obstacle for the company optimum growth:



There is a clear gap between Production and Marketing.



Company sales and marketing people have a package of their action plan.



Company do not giving its effort in marketing research, market development, product development, product positioning, un-trapped market, business plan, marketing plan, product planning, and an effective advertising and promotional planning.



Company did much promotional campaign but never try to figure out the reason for success and failure.



Individual job responsibility should be very specific.

Company is in developing stage. Gradually it is trying to figure out its system fall and week corner. In spite of many problems, it is the pioneer in furniture industry in our country. Hope it will be a systemic and standard organization.

www.AssignmentPoint.com