RETAILERS PERCEPTION TOWARDS THE SMALL SCALE CEMENT

J. V. Institute of Management Studies

A STUDY

ON

RETAILERS PERCEPTION TOWARDS THE SMALL SCALE CEMENT

INDUSTRY

SUBMITTED BY

KEYUR R. MANVAR

MBA Sem-IV

GUIDED BY

Dr. PRASANTA CHATTERJEE BISWAS

ACADEMIC YEAR

2008-2010

SUBMITTED TO

JAYSUKHLAL VADHAR INSTITUTE OF MANAGEMENT STUDIES

(JVIMS)

BIPIN T. VADHAR COLLEGE OF MANAGEMENT

JAMNAGAR

AFFILIATED TO

SAURASHTRA UNIVERSITY

RAJKOT


A STUDY

ON

RETAILERS PERCEPTION TOWARDS THE SMALL SCALE CEMENT

INDUSTRY

SUBMITTED BY

KEYUR R. MANVAR

MBA Sem-IV

GUIDED BY

Dr. PRASANTA CHATTERJEE BISWAS

ACADEMIC YEAR

2008-2010

SUBMITTED TO

JAYSUKHLAL VADHAR INSTITUTE OF MANAGEMENT STUDIES

(JVIMS)

BIPIN T. VADHAR COLLEGE OF MANAGEMENT

JAMNAGAR

AFFILIATED TO

SAURASHTRA UNIVERSITY

RAJKOT


DECLARATION

I undersigned KEYUR R. MANVAR a student of M.B.A. 4th semester, declare that I have

prepared this dissertation on Retailers Perception towards the Small Scale Cement Industry

under Dr. Prasanta C. Biswas of J.V. Institute of Management Studies.

I also declare that this dissertation is my own perception and not copied from anywhere else.

_____________________

KEYUR R. MANVAR

Role No.: - 29


ACKNOWLEDGEMENT

Perseverance, Inspiration and Motivation have always played a key role in the

success of any venture. And it is my personal belief that no report is the result of only its

author’s efforts. There are many people who contribute something of the others, and thus play a

significant role in laying the foundation of a truthful and an effective report that is capable of

achieving its purpose. So hereby, it’s my pleasure to record thanks and gratitude to the persons

involved.

I am greatly indebted to my Mentor Dr. Prasanta C. Biswas Assistant Professor

at JVIMS, Jamnagar. He was there to listen me and help me out if I ever had any problem.

He has been so lenient also.

Last but not the least; I owe my overwhelming gratitude to my Family and Friends

who gave me constant support and motivation to continue with this endeavor.


PREFACE

Practical study plays a vital role in the field of education. How management

principles are implemented in business can only be known through practical study, students can

be very well aware about industrial environment like problems, opportunities, different

situations etc. this helps the student for better understanding and also gives them a chance to

show their skills and ability.

This report throws lights to one of the key sector of Development. Cement Industry,

which has in the limelight due to its rapid development in all sector like IT, Education,

Architecture etc. and the Government of India and emergence as a major contributor to the

export of the country, which will, leads to the economic progress of the country.

The report seems in such a manner that can give comprehensive and relevant aspect

about the Cement Industry and especially with respect to the Retailers’ Perception, which is

racing towards capturing the Cement market of the country. In the first phase the current

scenario of the Cement industry, then it reflects on what are the Consumers’ expectations from

the company through the medium of customer as well as Dealer survey.

I hope that the report is fulfilling all the requirements as per the rules and

regulations of the University.


CONTENTS OF THE PROJECT REPORT

Sr.

No.

PARTICULER Page

No.

Chapter – 1

1.1 Introduction 1

1.2 Industry Overview

1.2.1 History of Cement Industry 4

1.2.2 Development of Industry in India 6

1.2.3 Government Policy 7

1.2.4 Capacity and Production 11

1.2.5 Consumption in India 15

1.2.6 Export from India 17

1.2.7 Growth through 5 year Plan 18

1.2.8 Future of Industry 20

1.3 Major Players of Cement Industry 21

Chapter – 2

Review of Literature 25

Chapter – 3

Research Methodology 27

3.1 Objective of the Study 29

3.2 Types of Research 30

3.3 Collection of Data 30

3.3.1Primary Data 30

3.3.2 Secondary Data 31

3.3.3 Field Work 31

3.4 Sampling Design 32


3.4.1Types of Universe 32

3.4.2 Sampling Unit 32

3.4.3 Sampling Size 32

3.4.5 Sampling Procedure 32

3.5 Limitation of the Research Study 33

Chapter – 4

Data Analysis and Data Interpretation

4.1 Brand Awareness & Influence of Advertisement 34

4.2 Aspect of Advertisement 37

4.3 Is current Brand Name easy to remember 39

4.4 Beg Identification for Illiterate labor 41

4.5 Likeness of the Criteria for Cement 43

4.6 Importance of the Brand Name 45

4.7 Different Promotional Activities 47

4.8 Media Vehicle for Advertisement 49

4.9 Brand Positioning Strategy 51

4.10 Media to aware in change of Brand Name 53

Chapter – 5

Findings 55

Suggestions 56

Chapter – 6

Conclusion 60

Chapter – 7

Bibliography 61

Questionnaire 62


LIST OF TABLES

Table

No.

PARTICULER Page

No.

1 Northern Region Capacity 12

2 Eastern Region Capacity 13

3 Western Region Capacity 13

4 Southern Region Capacity 13

5 Central Region Capacity 14

6 Zonal wise Consumption 15

7 Export from India 17

8 Growth through 5 year Plan 18

9 Brand Awareness & Influence of Advertisement 35

10 Aspect of Advertisement 37

11 Is current Brand Name easy to remember 39

12 Beg Identification for Illiterate labor 41

13 Likeness of the Criteria for Cement 43

14 Importance of the Brand Name 45

15 Different Promotional Activities 47

16 Media Vehicle for Advertisement 49

17 Brand Positioning Strategy 51

18 Media to aware in change of Brand Name 53


LIST OF CHARTS

Chart

No.

PARTICULER Page

No.

1 Brand Awareness & Influence of Advertisement 35

2 Aspect of Advertisement 37

3 Is current Brand Name easy to remember 39

4 Beg Identification for Illiterate labor 41

5 Likeness of the Criteria for Cement 43

6 Importance of the Brand Name 45

7 Different Promotional Activities 47

8 Media Vehicle for Advertisement 49

9 Brand Positioning Strategy 51

10 Media to aware in change of Brand Name 53


EXECUTIVE SUMMARY

Cement is a mixture of limestone, Clay, Silica and Gypsum. It is a fine powder

which when mixed with water sets to a hard mass as a result of hydration of the constituent

compounds. The cement industry is one of the main beneficiaries of the infrastructure boom.

With robust demand and adequate supply, the industry has bright future. The Indian Cement

Industry with total capacity 151.69 million tones is the second largest after China.

Cement industry is dominated by 20 companies who account for over 70 per cent of

the market. Individually no company accounts for over 12 per cent of the market. The major

players like UltraTech and ACC have been quiet successful in narrowing the gap between

demand and supply.

This study was carried out to understand where the small scale companies lacks &

where they scores over its competitors. Being an industrial product, cement is sold through

dealers and retailers. It is very necessary to keep all of them equally satisfied as they represent

the company for the customers.

The study was largely based on primary data. 50 dealers of Saurashtra Region were

visited. The primary data was collected from randomly selected set of dealer and retail outlets

through an informal interaction and well structured questionnaire. The sample size was 50;

respondents were from various parts of Jamnagar and also from the villages. Secondary data

was collected from the internet, and website of the companies.

Most of the consumers in Saurashtra Region are very familiars with different brand

of the cement. But they purchase cement based on the Quality and Brand name of the cement.

While Television and Wall Painting around 50 and 40 per cent respectively selected for best

media vehicle of advertisement of cement. Here around 42 per cent respondents believe that

target based prize is the most powerful promotional strategy.

Here respondents believe that the consumer purchase cement only on the Brand Name

and Quality. So it is very important for any small scale cement industry to provide good quality

product. In this way they can easily penetrate the market.



INTRODUCTION

Cement is a mixture of limestone, Clay, Silica and Gypsum. It is a fine powder

which when mixed with water sets to a hard mass as a result of hydration of the constituent

compounds. It is the most commonly used construction material. Cement is manufactured by

burning a mixture of limestone and Clay at high temperatures in a kiln, and then finely grinding

the resulting clinker along with Gypsum. The end product thus obtained is called Ordinary

Portland Cement (OPC).

DIFFERENT TYPES OF CEMENT

There are different varieties of cement based on different compositions according to

specific end uses, namely Ordinary Portland Cement, Portland Pozzolan Cement, Portland

Blast Furnace Slag Cement, White Cement and Specialized Cement. The basic difference lies

in the percentage of clinker used.

1. Ordinary Portland cement (OPC):

OPC, popularly known as grey cement, has 95% clinker and 5% of Gypsum and

other materials. It accounts for 70% of the total consumption. White cement is a variation of

OPC and is used for decorative purposes like rendering of walls, flooring etc. It contains a very

low proportion of iron oxide. Ordinary Portland cement is the most commonly used cement for

a wide range of applications. These applications cover dry-lean mixes, general-purpose ready-

mixes, and even high strength pre-cast and pre-stressed concrete.

2. Portland Pozzolan Cement (PPC):

Portland Pozzolan cement is Ordinary Portland Cement blended with Pozzolan

materials (power-station fly ash, burnt clays, ash from burnt plant material or Siliceous earths),

either together or separately. Portland clinker is ground with Gypsum and Pozzolan materials

which, though they do not have cementing properties in themselves, combine chemically with


Portland cement in the presence of water to form extra strong cementing material which resists

wet cracking, thermal cracking and has a high degree of cohesion and workability in concrete.

PPC has 80% clinker, 15% Pozzolan and 5% gypsum and accounts for 18% of the total cement

consumption. It is cheaply manufactured because it uses fly ash/burnt clay/coal waste as the

main ingredient. It has a lower heat of hydration, which helps in preventing cracks where large

volumes are being cast.

3. Portland Blast Furnace Slag Cement (PBFSC):

PBFSC consists of 45% clinker, 50% blast furnace slag and 5% Gypsum and

accounts for 10% of the total cement consumed. It has a heat of hydration even lower than PPC

and is generally used in construction of dams and similar massive constructions. Portland blast-

furnace slag cement contains up to 70 per cent of finely ground, granulated blast furnace slag, a

nonmetallic product consisting essentially of Silicates and Aluminum-silicates of Calcium. Slag

brings with it the advantage of the energy invested in the slag making. Grinding slag for cement

replacement takes only 25 per cent of the energy needed to manufacture Portland cement.

Using slag cement to replace a portion of Portland cement in a concrete mixture is a useful

method to make concrete better and more consistent. Portland blast-furnace slag cement has a

lighter colour, better concrete workability, easier finish ability, higher compressive and flexural

strength, lower permeability, improved resistance to aggressive chemicals and more consistent

plastic and hardened consistency.

4. White Cement:

White Portland cement has essentially the same properties as gray cement, except

for color, which is a very important quality control issue in the industry. It is manufactured

using fuel oil (instead of coal) and with iron oxide content below 0.4% to ensure whiteness.

Special cooling technique is used. It is used to enhance aesthetic value, in tiles and for flooring.

White cement is much more expensive than grey cement.


5. Specialized Cement:

Oil Well Cement: It is made from clinker with special additives to prevent any porosity.

Rapid Hardening Portland cement: It is similar to OPC, except that it is ground much finer, so that on casting, the

compressible strength increases rapidly.

Water Proof Cement: It is OPC, with small portion of calcium stearate or non-saponifibale oil to impart

waterproofing properties.

Masonry cement: This cement used for preparing bricklaying mortars and stuccos, and must not be

used in concrete. They are usually complex proprietary formulations containing Portland

clinker and a number of other ingredients that may include limestone, hydrated lime, air

entrainers, retarders, water proofers and coloring agents. They are formulated to yield workable

mortars that allow rapid and consistent masonry work. Subtle variations of Masonry cement in

the US are Plastic Cements and Stucco Cements. These are designed to produce controlled

bond with masonry blocks.

Expansive cements: It contain, in addition to Portland clinker, expansive clinkers (usually

sulfoaluminate clinkers), and are designed to offset the effects of drying shrinkage that is

normally encountered with hydraulic cements. This allows large floor slabs (up to 60 m square)

to be prepared without contraction joints.



HISTORY OF CEMENT INDUSTRY

In India, manufacturing of cement was first started in Madras in 1904. First three

companies were started in 1912-1913 and real beginning was started. When the plans started

there were 21 factories with an annual capacity of 328 million tons. After 1949 the cement

industry had a complete interference of Government the production, distribution and price of

cement and this hampered the growth of industry. It was only in 1977 that government

announces 12% post tax return on net worth, which was fair enough, and retention price would

be fixed to ensure it.

Cement is one of the core industries which plays a vital role in the growth and

expansion of a nation. It is basically a mixture of compounds, consisting mainly of silicates and

aluminates of calcium, formed out of calcium oxide, silica, aluminum oxide and iron oxide.

The demand for cement, being a derived one, depends primarily on the pace of activities in the

business, financial, real estate and infrastructure sectors of the economy. Cement is considered

preferred building material and is used worldwide for all construction works such as housing

and industrial construction, as well as for creation of infrastructures like ports, roads, power

plants, etc. Thus, it can said to be a significant contributor to the Government's revenue

collection and a pillar of overall planned development of an economy.

The real impetus was provided when partial decontrol was announced in 1982.

Through this policy all existing cement industry units were required to give up 66.67% of their

installed capacity as levy at controlled price. The most important objective of decontrol was to

eliminate black-marketing and bring down the price in the free market. It was in follow through

that the industry was fully controlled in 1989. In the last decade of 90s cement capacity

increased by more than twice. The industry was de-licensed in 1991, which augmented its

production in the very first year. In the 18th century a big effort started in Europe to understand

why some limes possess hydraulic properties.

The French Engineer Louis Vicat, inspired by the work of Smeaton and Parker,

began a study of hydraulic limes in 1812 (published in 1818 as "Recherches experimentales sur

les chaux de construction". He reported that in the absence of naturally occurring argillaceous


components in limestone, quality hydraulic limes could be prepared by the calcinations of fixed

ratios of clay proportioned with quicklime. In 1822, the production of "British Cement" had

been started by James Frost at Swanscombe based on a patent for "a new cement or artificial

stone". The invention of Portland cement is generally credited to Joseph Aspedin, an English

Bricklayer in 1824. It involves a double kilning such as was described by Vicat. The earliest

kiln is one of William Aspedin's bottle kilns from Robins & Aspedin factory at North fleet. The

earliest bottle or dome kilns were open kilns with tapered chimney to increase the draft. They

were burned in a batch rather than in a continuous fashion and were charged with alternating

layers of raw feed and solid fuel. The chamber kiln was an improved design developed and

patented by Mr. Johnson. The combustion gases from the kiln dried the raw material so that

when the kiln was burned out a new charge of dried material is immediately ready for use.

The time and heat losses resulting from drawing the clinker, recharging the kiln, and

then heating it again led to the design of shaft kiln with continuous burning of the materials,

one of the main problem of the new kiln operation was the difficulty of obtaining an even

clinker burning, as some of the product would be greatly under-burnt and others be much more

heavily clinkered. In 1898 Atlas Portland Cement Company According To Lewis improved the

design by using what is called a rotary kiln, this improvement was a big revolution in the

cement industry because the new kiln could produce 200 cement barrels per day compared to a

shaft kiln which produced only 40 to max 80 barrels per day; in addition to quick improvement

in this new design regarding the mixing, grinding equipments for raw material, grinding

equipments for coal, belt conveyor using mix kind of fuel such as natural gas .

In practice, the operation with the first generation of rotary kiln (Ransone kiln) was

very difficult due to problem of maintaining a sufficient and uniform kiln temperature with

excessive balling of raw feed and sticking on the Frederick lining. In 1899 Atlas Cement

Company improved the technology of the rotary kiln and fuel economy by replacing fuel oil

with powdered coal dust. Furthermore, modifications to the kiln were made by addition of two

auxiliary clinker coolers, in which the first hot discharged clinker was received as it fell from

the kiln and air flowing over it was heated and helped to ignite the coal-dust.

After 1900 there was rapid growth in both rotary kiln and auxiliary equipment

technology in the United States. Coal grinding mills were developed and coal burning in

cement kilns became the predominant combustion process in the industry.


DEVELOPMENT OF INDUSTRY IN INDIA

In India, the foundation of a stable Indian cement industry was laid in 1914 when

the Indian Cement Company Ltd. manufactured cement at Porbandar in Gujarat. In the initial

stages, particularly during the period before Independence, the growth of the sector had been

very slow. The indigenous production of cement was not sufficient to meet the entire domestic

demand and accordingly, the Government had to control its price and distribution statutorily.

Also, the large quantities of cement had to be imported for meeting the deficit in the economy.

However, with liberalization and introduction of several policy reforms, the cement industry

has been decontrolled which gave impetus to its pace of growth.

The industry has made rapid strides both in capacity/ production and process

technology terms. Today, it is one of the most advanced and pioneering sectors in the country.

Cement is a basic material input which facilitates the promotional and developmental efforts, at

a fast pace, in the areas of infrastructural set up and other construction related works. Since it is

a decontrolled commodity, its production and prices are largely governed by economic factors,

like, demand and supply, cost of raw materials and other inputs, production as well as

distribution costs.

The Indian cement industry is extremely energy intensive and is the third largest

user of coal in the country. It is modern and uses latest technology, which is among the best in

the world. Only a small segment of industry is using old technology based on wet and semi-dry

process. Also, the industry has tremendous potential for development as limestone of excellent

quality is found almost throughout the country. In other words, it is experiencing a boom on

account of overall growth of the Indian economy, cost control continuous technology up

gradation, etc. This has immensely helped it to conserve energy and fuel as well as to save

materials substantially.


GOVERNMENT POLICY

In India, the Department of Industrial Policy and Promotion (DIPP), under the

Ministry of Commerce and Industry, is the nodal agency for the development of cement

industries. And it is involved in monitoring their performance at regular intervals and

suggesting suitable policy incentives, as per the requirement. The Department is responsible for

formulation and implementation of promotional and developmental measures for growth of

entire industrial sector in general and of some selected industries like cement, light engineering,

leather, rubber, light machine tools, etc. in particular. It is involved in framing and

administering overall industrial policy and foreign direct investment (FDI) policy as well as

promoting FDI inflow into the country. It plays an active role in investment promotion through

dissemination of information on investment climate and opportunities in India as well as by

advising prospective investors about various policies and procedures.

Some of the rules and orders, administered by Department of Industrial Policy and

Promotion, relating to the cement industry are:-

Cement Control Order, 1967

Cement Cess Rule, 1993

Cement (Quality Control) Order,1995

Cement (Quality Control) Order, 2003

India is the Second Largest Manufacturer of Cement in the world. It is engaged in

the production of several varieties of cement such as Ordinary Portland Cement (OPC),

Portland Pozzolana Cement (PPC), Portland Blast Furnace Slag Cement (PBFS), Oil Well

Cement, Rapid Hardening Portland Cement, Sulphate Resisting Portland Cement, White

Cement, etc. They are produced strictly as per the Bureau of Indian Standards (BIS)

specifications and their quality is comparable with the best in the world. At present, the Indian

cement industry comprises 130 large cement plants with an installed capacity of 163.45 million

tons and about 332 mini cement plants with an estimated capacity of 11.10 million tons per

annum. Cement production during the year 2006-07 (April to December, 2006) has been


117.37 million tons registering a growth of 9.87 per cent over the corresponding period of

2005-06. During the same period, India exported 6.07 million tons of cement and clinker.

The industry has been actively pursuing various avenues to improve its productivity

and energy efficiency. There has been all-around up gradation of technology in all sections of

the plant like mining, process, equipment and machinery, packaging and transportation.

Adoption of modern techniques like photogrammetric and remote sensing has enabled the

industry to discover virgin limestone. Advanced equipments like hydraulic excavators, surface

miners, large wheel loaders and mobile crushers have helped the industry in increasing its

productivity considerably. Several large and small cement companies are also actively

considering their expansion plans in order to accelerate the growth and demand for the sector.

The major players in this area are ACC, Gujarat Ambuja Cement Limited, Grasim Industries

and UltraTech, India Cements Limited, Jaiprakash Associates, JK Cements, etc. Improvement

in cement industry has found ready markets in Bangladesh, Indonesia, Malaysia, Nepal,

Middle- East countries, Burma, Africa and South East Asian countries.

However, the industry still faces a number of constraints in terms of high cost of

power, high railway tariff, high incidence of State and Central levies and duties, lack of private

and public investment in infrastructure projects, low quality coal and inadequate growth of

related infrastructure like sea and rail transport, ports and bulk terminals. In order to overcome

such obstacles and utilize excess capacity available with the cement industry, the Government

has identified the following thrust areas for increasing its demand, namely-

Housing development programmers

Promotion of concrete highways and roads

Use of ready-mix concrete in large infrastructure projects and

Construction of concrete roads in rural areas under Prime Ministers Gram Sadak

Yojana.

The Department has been undertaking several measures like setting up of institutes/

councils for enhanced development of the industry. For instance, the National Council for

Cement and Building Materials (NCB) has been constituted as an apex body dedicated to

continuous research, technology development and transfer, education as well as scientific,

technological and industrial services for the cement, related building materials and construction


industries. It acts as a preferred technology partner to such sectors in the sustainable

development of a better infrastructure and housing. NCB carries on its activities through its

units located at Ballabhgarh, Delhi, Hyderabad, Ahmadabad and Bhubaneswar. NCB's

activities are channelized through its following six programme centers:

Cement Research and Independent Testing

Mining, Environment, Plant Engineering and Operation

Construction Development and Research

Industrial Information Services

Continuing Education Services

Quality Management, Standards and Calibration Services

Another important being the setting up of a 'Development Council for Cement Industry'

under the Industries (Development & Regulation) Act, 1951. The Council promotes the

development of the cement industry in India, through various measures, by providing funds for

developmental projects. The source of funding the activities of the Council is the cess collected

by it from the cement manufacturers in terms of Cement Cess Rules, 1993. The various

projects of this Council are -

Base Level activities of NCB and R&D projects initiated by it for the development of

the cement industry.

Projects for improvement of the productivity of the industry by reducing cost.

Projects for optimum utilizations of raw materials.

Projects for modernizations of cement plants.

Another important thing is the pollution made by the cement industry. So, for the

control of the pollution, the Government had made many projects like:-

Projects for standardization and quality control programmes.

Projects for development of bulk supply and distribution of cement.

Projects for training and up gradation of the skill of the personnel in the cement

industry.

Projects for development of National Data Bank and information Services.


During 2006-07, the Council has received an allocation of Rs.3.50 crore for making

expenditure on the above activities. It funded base level activities and 4 (four) R&D projects of

NCB.

Besides, in order to improve and supplement the industry's performance, the

Department has constituted a 'Working Group on Cement Industry' for the formulation of the

11th Plan. The report of this working group emphasizes the importance of bulk cement

transportation, use of ready mix concrete and reduction of taxes and levies on cement. It also

seeks regulatory support for creating framework for co-processing of wastes, co-generation of

power and enhanced support to R&D activities to align the technology regime with the best of

the world. As per the working group report on the industry, the cement demand is likely to

grow at 11.5 per cent per annum during the 11th Plan and cement production and capacity by

the end of the 11th Plan are estimated to be 269 million tons and 298 million tons, respectively,

with capacity utilizations of 90 per cent. To attain the targeted capacity addition, an investment

of Rs. 52,400 crore would be required during the 11th Plan.

Thus, the Indian cement industry has strong capacity base and produces quality

cement which meets the global standards. It has achieved a tremendous success in

technological up gradation and assimilation of latest technology. There is also great scope for

increase in export of cement. More importantly, the gap between its demand and supply has

been reduced to a very large extent and the sector is likely to witness higher growth in the

coming years. All this indicates that the cement industry has an important role to play in the

Indian economy. Owing to booming housing sector, global demand and increased activity in

infrastructure development such as State and National highways, there exists ample investment

opportunities in the industry. It has been attracting the top cement companies from all over the

world and promoting more mergers and acquisitions for its overall growth.


CAPACITY AND PRODUCTION

The cement industry comprises 130 large cement plants with an installed capacity of

163.45 million tones and more than 332 mini cement plants with an estimated capacity of 11.10

million tones per annum resulting in total installed capacity of 174 million tones. According to

the Cement Manufacturers Association, the overall cement production rose by 8.11 per cent

during 2007-08 to 168.29 million tons as against 155.66 million tons in 2006-07. Due to the

government's boost to infrastructure, the consumption is expected to go up even further.

The Cement Corporation of India, which is a central public sector undertaking, has

10 units. Besides, there are 10 large cement plants owned by various state governments.

According to a report by the ICRA Industry Monitor, the installed capacity is expected to

increase to 186 million tons per annum by FY08-end, and 219 million tons per annum by end

of FY09, and further up to 241 million tons per annum by FY10-end. As a result, India's

cement industry will record an annual growth at 10 per cent in the coming years with higher

domestic demand resulting in increased capacity utilization. 100 per cent Foreign Direct

Investment (FDI) is permitted in this sector. 100 per cent FDI is also permitted for cement

companies for setting up captive power plants as well as coal and lignite mines for captive

consumption.

As per industry estimates there is a 40 million ton shortfall between demand and

supply, which would require an investment of over US $ 2 billion. Apart from meeting the

domestic demand, the cement industry also contributes towards exports. Now let’s see the state

wise capacity of cement in India.


STATE WISE CAPACITY

As cement is a low value commodity, freight costs assume a significant proportion

of the final cost. Transporting costs render the prices of cement in distant destinations

uncompetitive. For instance, it is financially infeasible to transport cement by road over 250

km. Railways are mostly used to transport cement over longer distances. However, its bulky

nature and infrastructure bottlenecks render even rail transport unviable over very long

distances (that is why Madras Cements or India Cements, located in the south, can hardly make

a difference to the fortunes of west-based companies like Gujarat Ambuja). Therefore,

manufacturers tend to sell cement at the nearest market first and sell in distant markets only if

additional realization is greater than freight costs incurred. This is the reason for showing

regional demand rather than state demand in case of cement.

Region wise Capacity The Indian cement industry has to be viewed in terms of five regions:- North (Punjab, Delhi, Haryana, Himachal Pradesh, Rajasthan, Chandigarh and J&K) West (Maharashtra and Gujarat)

South (Tamil Nadu, Andhra Pradesh, Karnataka, Kerala, Pondicherry, Andaman &

Nicobar and Goa)

East (Bihar, Orissa, West Bengal, Assam, Meghalaya, Jharkhand and Chhattisgarh) and

Central (Uttar Pradesh and Madhya Pradesh).

Northern Region STATE CAPACITY IN TON

Punjab 2173.34

Delhi 500.00

Haryana 172.00

Rajasthan 4060.00

Himachal Pradesh 16299.34

J&N 200.00

Total 23404.68

Table No. - 1


Eastern Region STATE CAPACITY IN TON

Bihar 1000.00

Orissa 2761.00

West Bengal 2291.66

Assam & Meghalaya 400.00

Jharkhand 3475.01

Chhattisgarh 11287.33

Total 21215.00

Table No. - 2

Western Region STATE CAPACITY IN TON

Maharashtra 8950.00

Gujarat 12937.00

Total 21887.00

Table No. - 3

Southern Region STATE CAPACITY IN TON

Punjab 2173.34

Delhi 500.00

Haryana 172.00

Rajasthan 4060.00

Himachal Pradesh 16299.34

J&N 200.00

Total 23404.68

Table No. - 4


Central Region STATE CAPACITY IN TON

Utter Pradesh 6297.00

Madhya Pradesh 16185.00

Total 22482.00

Table No. - 5

South accounts for 33.03 per cent of cement production capacity of the country,

with Andhra Pradesh accounting for 15.27 per cent of the total production capacity of India. It

has an installed capacity of around 20 million tons of cement and ranks first in the country,

followed by Tamil Nadu with 9.94 per cent of the total production capacity. North accounts for

18.02 per cent of the total production capacity, with Rajasthan at 12.55 per cent of the total

production capacity of the country. West accounts for 16.85 per cent of the total production

capacity. Maharashtra and Gujarat have production capacity of 6.89 per cent and 9.96 per cent

respectively. East and Central Regions account for 16.33 per cent and 15.77 per cent of the

total production capacity of the country respectively.

Trade between these regions is on a very low scale mainly because of the

transportation bottlenecks and uncompetitive cost of transportation. The Southern region

dominated the cement consumption at 44.5 million tons in FY 07, accounting for about 30 per

cent of total domestic cement consumption. During FY 03-07, Southern region has witnessed

highest CAGR of cement demand growth at 10.4 per cent followed by Northern and Eastern

regions at 8.9 per cent and 9 per cent respectively.


CONSUMPTION IN INDIA

The demand drivers for the cement sector continue to be housing, infrastructure and

commercial construction, etc. We expect the proportion of infrastructure in total demand to

improve further in future, as the thrust on infrastructure development is on the rise. During

April-November 2007, cement demand grew by 10 per cent year - on- year (y-o-y) propelled

by the growth witnessed in end user segments such as housing, infrastructure etc. CRISIL

Research expects demand to remain strong and grow by over 12 per cent in the next 2 years.

Cement demand is expected to outstrip supply for the next year and a half as no major

capacities are coming on stream, thus providing enough flexibility to cement manufacturers to

further hike the prices.

Today, cement from Andhra Pradesh is going all over India, including Assam,

Meghalaya, Jharkhand, Orissa, West Bengal, Chhattisgarh, Gujarat and Maharashtra. More

cement is likely to flow into Tamil Nadu from the state in view of cut in sales tax. Any further

increase in demand in the South India will benefit the cement industry here. Cement movement

from Gujarat to Mumbai is also coming down due to exports while cement movement from

Orissa into Andhra Pradesh has stopped and, in fact, cement is flowing into Orissa as well.

Zonal Wise Consumption

Zone Year 2006-07 Year 2007-08

North 21% 20%

East 17% 17%

West 20% 18%

South 26% 30%

Central 17% 16%

Table No. - 6


Earlier in 2006-07, the housing sector alone consumed 65 per cent of the total

domestic consumption. With the launch of several infrastructure projects, the housing

consumption may come down to 55 per cent as the infrastructure and other sectors are expected

to move up to 45 per cent from the present 35 per cent. Still, the main sector of consumption

continues to be housing, including commercial space, occupying more than 60 per cent. The

current demand in the state for 2005- 06 is expected to cross 15 million tons (11.5 million

tons). We expect the demand here to go past the 17.5 million mark in 2006-07 in view of

irrigation and infrastructure projects being taken up in the state. Weaker sections’ housing,

construction of public toilets, schools in rural areas apart from several private and public

infrastructure projects will also give tremendous boost to the cement consumption in the state.

Most importantly, irrigation projects, worth nearly Rs 1 lakh crore, will trigger unprecedented

demand for the next 5-7 years.


EXPORT FROM INDIA

The Indian cement Industry not only ranks second in the production of cement in

the world but also produces quality cement, which meets global standards. In this way India is

one of the largest exporters of the cement.

Year Cement Clinker Total in

Million tons

2003-04 3.36 5.64 9.00

2004-05 3.31 4.82 8.13

2005-06 3.96 5.31 9.27

2006-07 4.05 5.56 9.61

2007-08 4.23 5.81 10.04

2008-09

Jan- March

4.08 4.43 8.51

Table No. - 7


CEMENT INDUSTRY GROWTH THROUGH

FIVE – YEAR PLAN

MT = Million Tons

Five Year Plan Years Capacity

in MT

Production

In MT

Pre Plan 1950 – 51 3.28 2.20

I – Plan 1951- 56 5.02 4.60

II – Plan 1956 – 61 9.30 7.97

III – Plan 1961 – 66 12.00 10.97

IV – Plan 1969 - 74 19.76 14.66

V – Plan 1974 – 79 22.58 19.42

VI – Plan 1980 – 85 42.40 30.13

VII – Plan 1985 – 90 61.31 45.41

VIII – Plan 1992 – 97 105.26 76.22

IX – Plan 1997 – 02 146.13 108.40

X – Plan 2002 – 07 202.64 165.56

Table No. - 8

In India, the per capita cement consumption is abysmally low at 99 kg. as against a

world average of 225 kg. and Asian average 200 kg. These figures indicate good potential for

growth of industry.

Cement Manufacturers Association.


TECHNOLOGICAL ADVANCEMENT

Cement industry in India is currently going through a technological change as a lot

of up gradation and assimilation is taking place. Currently, almost 93 per cent of the total

capacity is based entirely on the modern dry process, which is considered as more

environment-friendly. Only the rest 7 per cent uses old wet and semi-dry process technology.

There is also a huge scope of waste heat recovery in the cement plants, which lead to reduction

in the emission level and hence improves the environment.

The manufacturing process of cement consists of the mixing, drying and grinding of

limestone, clay and silica into a composite mass. The mixture is then heated and burnt in a pre-

heater and kiln to be cooled in an air cooling system to form clinker, which is the Semi-finished

form. This clinker is cooled by air and subsequently ground with gypsum to form cement. The

dry and semi-dry processes are more fuel-efficient. The wet process requires 0.28 ton of coal

and 110 kWh of power to manufacture one ton of cement, whereas the dry process requires

only 0.18 tons of coal and 100 kWh of power. Coal and power costs account for 35 per cent of

the total cement production costs. With 95 per cent of the total capacity based on the modern

dry process technology, the Indian cement industry has become more cost efficient.


FUTURE OF INDUSTRY

The Indian cement is experiencing a boom driven by a soaring housing sector and

increased activity in infrastructure development. The cement industry dispatched over 155.8

million tones of cement in the current year, registering a growth of 11.3 per cent, even though

capacity increased by only 3 per cent to 165 million tones.

The Government has set a growth target of 9 per cent for the economy during 11th

five-year plan (2007 - 2012). The plan proposed to specifically address issues of promoting

industrial growth, construction, housing and real estate. Plans include a focus on urban

infrastructure development, road railways, ports and airports. All these factors are likely to fast

forward the growth in cement demand in the coming years. Earlier in 2004-05, the housing

sector alone consumed 65 per cent of the total domestic consumption. With the launch of

several infrastructure projects, the housing consumption may come down to 55 per cent as the

infrastructure and other sectors are expected to move up to 45 per cent from the present 35 per

cent.

While various companies have announced huge new capacities of about 50 million

tones, we believe that the implementation of three plans will begin in phased manner from the

year 2009 onwards. The price outlook seems ton be positive for the current as well as next year.

The Government has projected growth in cement demand for the 11th plan at 11.5 per cent

CAGR. This growth rate seems quite feasible given the huge investment planned in

infrastructure by both the government and private sector.

Still, the main sector of consumption continues to be housing, including commercial

space, occupying more than 60 per cent. The current demand in the state for 2005-06 is

expected to cross 15 million tones (11.5 million tones). We expect the demand here to go past

the 17.5 million mark in 2006-07 in view of irrigation and infrastructure projects being taken

up in the state.

So, we can say that the future of cement industry is bright because most of the

demand is from construction sector and it is also very high. As we know that the infrastructure

sector is in boom that’s why.



As we know that in India The cement industry comprises 130 large cement plants

with an installed capacity of 163.45 million tones and more than 332 mini cement plants with

an estimated capacity of 11.10 million tones per annum resulting in total installed capacity of

174 million tones. So now let’s take a look at some of the major players of this industry.

LARGE CEMENT PLANTS

Associated Cement Companies Ltd. (ACCL)

Associated Cement Companies Ltd manufactures ordinary Portland cement,

composite cement and special cement and has begun offering its marketing expertise and

distribution facilities to other producers in cement and related areas. It has twelve

manufacturing plants located throughout the country with exports to SAARC nations. The

company plans capital expenditure through expansion of existing units and/or through

acquisitions. Non-core assets are to be divested to release locked up capital. It is also expected

to actively pursue overseas project engineering and consultancy services.

Birla Corporation Ltd.

Birla Corp's product portfolio includes acetylene gas, auto trim parts, casting,

cement, jute goods, yarn, calcium carbide etc. The cement division has an installed capacity of

4.78 million metric tons and produced 4.77 million metric tons of cement in 2003- 04. The

company has two plants in Madhya Pradesh and Rajasthan and one each in West Bengal and

Uttar Pradesh and holds a market share of 4.1 per cent. It manufactures Ordinary Portland

cement (OPC), Portland Pozzolan cement, fly ash based PPC, Low-alkali Portland cement,

Portland slag cement, low heat cement and sulphate resistant cement. Large quantities of its

cement are exported to Nepal and Bangladesh. Going forward, the company is setting up its

captive power plant to remain cost competitive.


Grasim-UltraTech Cement company Ltd.

Grasim's product profile includes viscose staple fibre (VSF), grey cement, white

cement, sponge iron, chemicals and textiles. With the acquisition of UltraTech, L&T's cement

division in early 2004, Grasim has now become the world's seventh largest cement producer

with a combined capacity of 31 million tons. Grasim (with UltraTech) held a market share of

around 21 per cent in 2003-04. It has plants in Madhya Pradesh, Chhattisgarh, Punjab,

Rajasthan, Tamil Nadu and Gujarat among others. The company plans to invest over US$ 9

million in the next two years to augment capacity of its cement and fibre business. It’s also

plans to focus on its international ventures, ramping up the capacity of Alexandra Carbon Black

in Egypt to 1,70,000 ton per annum (from 1, 20,000 ton per annum) and raising the capacity of

the carbon black plant in China from 12,000 ton per annum to 60,000 ton per annum.

Gujarat Ambuja Cements Ltd. (GACL)

Gujarat Ambuja Cements Ltd was set up in 1986 with the commencement of

commercial production at its 2 million ton plant in Chandrapur, Maharashtra. The group has

clinker manufacturing facilities at Himachal Pradesh, Gujarat, Maharashtra, Chhattisgarh,

Punjab and Rajasthan. The company has a market share of around 10 per cent, with a strong

foothold in the northern and western markets. Its total sales aggregated US$ 526 million with a

capacity of 12.6 million tons in 2003-04. Gujarat Ambuja is India's largest cement exporter and

one of the most cost efficient firms. GACL has a 14.45 per cent stake in ACC, making it the

second largest cement group in the country, after Grasim-UltraTech Cement Company. The

company has free cash flows that it is likely to use to grow inorganically. The company is

scouting for a capacity of around two million ton in the northern and western markets. It has

also earmarked around US$ 195-220 million for acquisitions.


Jaiprakash Associates Limited

Jaiprakash Industries, now known as Jaiprakash Associates Limited (JAL) is part of

the Jaypee group with businesses in civil engineering, hospitality, cement, hydropower, design

consultancy and IT. It has an annual capacity of 4.6 million tons with plants located in Rewa &

Bela (Madhya Pradesh) and Sadva Khurd (Uttar Pradesh). The company has a market share of

3.8 per cent with the cement division contributing US$ 172 million to revenue in 2003-04. The

company is upgrading its capacity to 6.5 million tons through the modernizing of the existing

units and the commissioning of a new grinding unit at Tanda (Uttar Pradesh) with an

investment of US$ 163 million. Jaiprakash Associates has decided to concentrate on its core

business of construction and engineering and leave its cement plant to its subsidiary Jaypee

Rewa Cement Ltd. The company manufactures a wide range of world class cement of OPC

grades 33, 43, 53, IRST-40 and special blends of pozzolana cement.


SMALL CEMENT PLANTS

Kishan Cement

Kishan Cement Pvt. Ltd. Is leading construction cement manufacturer in Gujarat,

India with capacity to manufacturer Ordinary Portland Cement, Portland Pozzolan Cement, 43

Grade Cement, 53 Grade. Challenge the limits, is the crystal clear aim of Kishan Cement.

Kishan group provides superior quality cement from its Modern plant located at Shapar near

Rajkot and thus in the heart of Saurashtra region. When it was really tough to manufacture

cement, Kishan Cement dared to cater best grade cement. In short span Kishan Cement touched

the heart of every customer by its quality and services.

Major Cement

Major Cement, an ISO 9001 Company is leading high quality cement

manufacturing company at Shapar, located in the center of Saurashtra. Major Cement

established to explore limitless possibilities on the expanding field of cement manufacturing. It

is a fledglings company that is making great progress in the cement industry with special

emphasis on quality. The modern technologies manufacturing facilities at Shapar bear a

testimony to the spirit of the makers of Major Cement. Computerized plant assures production

nearly 1 million tons per annum. Continuous Research and Development is the policy adapted

by the company to ensure its customer oriented quality cement.

Shree Radheshyam Cement Pvt. Ltd.

Shree Radheshyam Cement Pvt. Ltd. is one of the small scale cement industries

were established in 27th January, 2008. Shree Radheshyam Cement Pvt. Ltd. Plant is located at

Chauta in Kutiyana Taluka in Porbandar district (Gujarat). The machinery usage is sources

from reputed international companies. The Plant operating at over 100 per cent capacity is also

one of the cost effective cement producer in the Saurashtra Region. The selection of the right

place or better location decision is based on the future plan to enter in an export market. For

that purpose the plant is also nearest to the Porbandar Port.



Since no reference were available on the perception of the retailers toward small scale cement industry, relevant reference and views expressed by researcher on perception of the other products are include in this part.

CONSUMER PERCEPTION

Leclerc et al. (1994) with three experiments examined the notion that foreign

branding—the strategy of pronouncing or spelling a brand name in a foreign language--triggers

cultural stereotypes and influences product perceptions and attitudes. Choosing French brands

as one specific case, Experiment 1 showed that the French pronunciation of a brand name

affected the perceived hedonism of the products, attitudes toward the brand, and attitudes

toward the brand name. Experiment 2 showed that congruent country-of-origin information,

added to French branding, does not result in more hedonic perceptions; incongruence, however,

diminishes the effect. In Experiment 3, an actual product taste test was performed. Despite the

presence of direct sensory experience, consumer perceptions of a product changed as a result of

French branding

An important consumer opinion of some food product relates to the perception of

“home-made quality”. Bower and Baxter (2000) conducted a study, which examined

consumer perception in dairy ice cream along with product knowledge and consumption habits

and influences. A questionnaire was delivered followed by tasting of commercial products and

homemade formulations. All of the participants (n = 105) consumed dairy ice cream and 62 per

cent named it as their most frequent type of ice cream, with sensory quality being the most

important reason influencing choice. Product knowledge was relatively high with 74 per cent of

respondents claiming to know two out of three product characteristics. Consumer opinion was

divided on a pre-stated preference for “home-made” or “commercial”, with 56 percent being in

favour of the homemade form, which was valued because of an assumed superior taste, quality

and a more intimate knowledge of ingredients. Commercial quality also required “good taste”,

but its convenience value was very important. On blind tasting, the degree of liking for both

forms was usually high, but correct identification (home-made vs. commercial) levels were

low. Subjects with previous experience of homemade ice cream had a more positive attitude to

it, and had more success in distinguishing it from the commercial form. Generally, homemade

quality was viewed as a desirable feature of dairy ice cream.


Companies do not seem to understand that they live in different ecosystems

compared to their customers (Arussy, 2004)

Huang et al. (2004) undertook a study, to investigate the relationship between

brand names and consumers' perceived risk. Hypotheses dealt with whether the presence of a

product's brand name affects consumers. Perceived risk towards shopping online; whether the

familiarity with a brand name influences consumers' perceived risk; and whether online

shoppers and non-shoppers perceive risk towards shopping online differently. Results indicate

that the presence or absence of a product's brand name affects online shoppers. Perceived risk,

but in the opposite direction to that expected. There was no significant difference between

online shoppers' perceived risk vis-à-vis brand familiarity; however, online shoppers possessed

lower perceived risk than non-shoppers. Implications and limitations were discussed and

recommendations for future research were provided.

According to Sinha (2004), the biggest change is happening not in the market place

but in the consumer’s mind, the place where brands really live. Consumers do not generally

include all brands in their consideration set but in a subset can change over time. As consumers

become more conscious, the brand premium will constantly change and companies will have to

make appropriate changes in the brand and the marketing strategy. According to him, Indian

market is big and there is room for several brands to coexist in peace and make healthy profits.

Many a time, a brand may command a particular price in a given country or context, and may

be unable to do so in another context or geography.

The effects of word of mouth (WOM) on the receiver’s attitudes and intentions have

been studied at length by Wangenheim et al. (2004). This paper studied the effects of WOM in

the context of service provider switching. An empirical study was presented which researches

whether perceived influence of a switching referral was related to subsequent switching

behaviour, and whether the variables that have an effect on perceived influence of the

switching referral also predicted switching. Results showed that the strength of WOM influence

was determined by perceived communicator characteristics. Perceived risk dimensions, in turn,

moderated these effects.



Research has moved during this century from the periphery to the center of our

social and economic life. What is the nature of this force? Why it is getting momentum? Most

of us recognize that the progress, which has been made in our society, has been largely the

result of research. So, research in common parlance refers to the search for knowledge.

Research simply seeks the answer of certain questions, which have not been answered so far,

and the answers depend upon the human efforts.

MEANING OF RESEARCH

Research is simply the process of arriving as dependable solution to a problem

through the planned and systematic collection, analysis and interpretation of data. The term

research consists of two words:

Research= Re + Search.

‘Re’ means repeatedly and ‘Search’ means to find out something. The following is the process: Again & Again Analysis of data

Therefore, research means to observe the phenomenon repeatedly from different

dimensions. The research is a process of which a person observes the phenomena repeatedly

and collects the data and based on data he draws some conclusions.

Research is the most important process for advancing knowledge for promoting

progress and to enable man to relate more effectively to his environment, to accomplish his

purpose and to resolve his conflicts. Although it is not the only way, it is one of the more

effective ways of solving scientific problems. It simply seeks the answer of certain questions

which have not been answered so far and whose answer is not available in the literature i.e. in

human knowledge.

Phenomena Conclusions Person


DEFINITION OF RESEARCH

Simple definition of the research is “Systematized effort to gain new knowledge.”

Redman & Mory

“Research comprises defining and redefining problems, formulating hypothesis of

suggested solutions; collecting, organizing and evaluating data; making deductions and

reaching conclusions; and at last carefully testing the conclusions to determine whether they fit

the formulating hypothesis.”

Clifford Woody

“Research is the manipulation of things, concepts or symbols for the purpose of

generalizing to extend, correct or verify knowledge, whether that knowledge aids in

construction of theory or in the practice of an art.”

D. Slesinger & M. Stephenson

Encyclopedia of Social Science


OBJECTIVE

It has been found by many cement companies that there is diversity in the

perception of consumer and retailers of Saurashtra Region, which can not be found elsewhere

in country. Considering this I had gone under this research.

PRIMARY OBJECTIVE

The Primary objective of the research is to find out the perception of the retailer

toward the small scale cement plants.

SECONDARY OBJECTIVE

There are many other objectives also for doing this research. They are as follow

Comprehensive survey to rate various available Brands in the Market.

To analyze the consumer’s perception about the concept of discounted sale.

To find out the problems faced by the dealers/retailers and try to minimize these

problems.

To find out the possible newer methods for advertisement and methods for increasing

sales of Small Scale cement manufacturers.


TYPES OF RESEARCH

There are various types of research which a researcher can adopt like Descriptive

and Analytical, Applied and Empirical, Historical research, Experimental research, etc. here the

researcher has adopted an Exploratory type of research.

EXPLORATORY RESEARCH

Exploratory research provides insights into and comprehension of an issue or

situation. It should draw definitive conclusions only with extreme caution. Exploratory

research is a type of research conducted because a problem has not been clearly defined.

Exploratory research helps determine the best research design, data collection method and

selection of subjects. Given its fundamental nature, exploratory research often concludes that a

perceived problem does not actually exist.

COLLECTION OF DATA

Data means observations or evidences. The scientific educational research requires

the data by means of some standardized research tools or self-designed instruments. Data is like

the raw material and its quality will determine the quality of research. While deciding about the

method to be used for data collection, the researcher must keep in mind the two types of data

i.e. Primary Data and Secondary Data.

PRIMARY DATA

Primary data are those, which are, collected a fresh and for the first time and thus

original in character.

The primary data was collected by means of a survey. Questionnaires were

prepared and people of Saurashtra Region were approached to fill up these questionnaires.

The filled up information was later analyzed to obtain the required information.


SECONDARY DATA

The secondary data are those which have already been collected by someone else

and which have already been passed through the statistical process.

In order to have a proper understanding of the small scale cement industry and

some of the new ideas of increase sales, an in depth study was done from the various books,

magazines, articles written on the subject. Many data has also been collected from these and

also from websites on the topic.

FIELD WORK

In order to gather the primary data associated with this survey of dealers over a

selected hub of areas at Saurashtra Regions, I have undergone an extensive fieldwork. The

basic purpose of the field work was, obviously, to record responses of target dealers.


SAMPLING DESIGN

While developing a sampling design, the researcher must pay attention to the

following points

TYPES OF UNIVERSE

The first step in developing any sample design is to clearly define the set of objects,

technically called the Universe, to be studied. Here the universe is consisting of Dealers/Sub-

Dealers/Retailer of the cement and secondary data.

SAMPLING UNITS

The sampling units of this study are views from dealers of Saurashtra Region where

in Dealers/Sub-Dealers have been met. To define sampling unit, one must answer the question

that who is to be surveyed. In this project sampling unit is Dealers and sub-dealers who are

purchasing cement from the small and large scale cement industries and the customers, we

called retailers who are purchasing cement as per their timely requirement. The Geographical

Unit is Area and the social unit is Dealers, sub-dealers and Retailers.

SAMPLING SIZE

This refers to the number of items to be selected from the universe to constitute a

sample. This is a major problem before a researcher. The size of sample should neither be

excessively large, nor too small. It should be optimum. Sample size for this research was 50

through the non- probability sampling.

SAMPLING PROCEDURE

First of all the list of the Dealers/ Sub- Dealers/ Retailers was taken from Internet

and then I used to meet them personally and discussed the questions and in this way got the

whole 50 samples.


LIMITATIONS OF THE RESEARCH STUDY

Every research have some limitations, here also I had found many limitations of the

study. It can be divided into four (4) groups as under.

GEOGRAPHICAL LOCATION

The project was conducted in Based on the data from Saurashtra Region only. As

the region is big, so I could not collect data from all the cities. In this way the finding of the

project is valid only for Saurashtra Region.

SAMPLE SIZE

Due to considering time constraint the sample size was restricted, so the finding

may not give a very accurate result. The sample size 35 is very limited. So, it is not possible to

achieve 100% accuracy in research.

SAMPLING TECHNIQUES

Due to the convenience method, I used non-probability judgment sampling

technique. So sample may not represent parameters of whole population.

OTHER LIMITATIONS

1.

The major problem of the survey was that most of the respondents being very loyal

to their brands didn’t give exact answers like they didn’t talk much about what problems they

are facing, what are the different marketing schemes of the brand in which they deal etc.

2.

Once we got the questionnaire filled, we need to restart the conversation in a very

generalized way and talk about the local market conditions. Like who is the main dealer, which


cement is mostly sold in that area and many things. So this survey demands a good piece of

time while talking to the respondent. Also the Saurashtra region is big and there are many

districts with a number of small towns and villages. So to complete the survey within 2 months

time seems to be a bit difficult.

3.

Some of the respondents may have told their average monthly sale more than the

actual. Because all of them think that the monthly sale attached with the market image of their

shop.

4.

Many of the dealers/retailers refused to answer any question at all. So the actual

figures can be somewhat different from the one that we have found out.

5.

As, I am not expertise in this field, so the result may not be as perfect as it should be

for company’s expectations.



BRAND AWARENESS AND INFLUENCE OF THE ADVERTISEMENT Table No. - 9

Chart No. - 1

Brand Name Brand Awareness Influenced by Ad.

Associated Cement Co. 28 8

Gujarat Ambuja Cement 46 40

India Cement 13 -

Madras Cement 8 -

Sanghi Cement 44 5

UltraTech Cement 48 43

Hathi Cement 46 25

Kishan Cement 15 5

Major Cement 15 4

Rambo Cement 3 -

Sathi Cement 16 -

Tapi Cement 23 7


INTERPRETATION

Brand Awareness of UltraTech Cement comes on the first position, because most of the

respondents are aware of the brand. The survey shows that 48 out of 50 respondents are

aware and also they very much influenced by the advertisement of the company. The

Influence of advertisement of for the brand is 86 per cent.

Gujarat Ambuja Cement and Hathi Cement come on the second position. But here

Gujarat Ambuja Cement had influenced the lot, while Hathi Cement is not much

influencing.

Sanghi Cement is well aware by respondents and comes on the third place with 88 per

cent, but at the same time the influence of the advertisement is only 10 per cent.

Associated Cement Company and Tapi Cement come on the forth and fifth stage

respectively with the awareness of 28 and 23 respondents only. So, the influence of the

advertisement is very lower than the first three companies.

Next come Sathi Cement, Kishan Cement and Major Cement with lower awareness and

also the advertisement influence.

While India Cement, Madras Cement and Rambo Cement at the last stages, because

most of the respondents are of the village side of the Saurashtra Region and they don’t

know about these companies.


ASPECT OF THE ADVERTISEMENT Table No. - 10

Chart No. - 2

INTERPRETATION

Most of the dealers like the advertisement of UltraTech Cement because of its Logo

and also because they like the Name Itself. So, approximately around 28 per cent of the

Dealers like the logo of the cement.

Aspect of Ad. Response in %

Name 16%

Character 14%

Logo 28%

Slogan 26%

Colour -

Others 16%


Slogan is also important for any advertisement, so here the advertisement like Ambuja

Cement is liked for the slogan and also for the Brand character (Muscle man). So,

around 26 per cent Dealers like the Slogan aspect.

Many Dealers like the advertisement only because of the name of the Company and

Brand. Because they fill that the brand name is easy to remember. So, around 16 per

cent Dealers like the Name of the Company.

In the advertisement like Binani Cement and Hathi Cement, Dealers like the

Character aspect and this aspect had around 14 per cent part in the survey.

At last, around 16 per cent of Dealers like the different style of the advertisement and

there is no likeness for the Colour aspect.


IS CURRENT BRAND NAME EASY TO REMEMBER?

Criteria Response in %

Yes 84%

No 16%

Table No. - 11

Chart No. – 3 INTERPRETATION

The different small as well as large scale cement industries are select better brand name

with perfect meaning and easy to remember by the consumer.

The survey show that The Large scale cement Industries as well as Small Scale

industries had around 84 per cent respondents who can easily remember the Brand

name of UltraTech, Sathi cement, Hathi Cement and many other.

While only 16 per cent respondents are not ready or agree with same matter.


Factors and their relative importance for UltraTech brand name. Name itself: is very

Modern once and upon hearing the name one can easily remember it. And Sathi is old

but easy to remember for everyone.

Logo comes on the second stand after the Brand Name.

While Tag-line and Pronunciation stand on the last stage.


BEG IDENTTIFICATION FOR THE ILLITERATE LABOR

Bag Identity Dealers Choice in%

Colour of Bag 18%

Logo of the Cement 62%

Colour Of the Brand Name 20%

Structure of Logo -

Table No. - 12

Chart No. - 4

INTERPRETATION

Cement Bag play an important role for Dealers because the attractive look, Brand name

and Logo etc. are very imp. For any consumer the Bag also play vital role for purchase

the cement.

Particularly this question directly relates to the illiterate people.


Logo: it is the visual signature of the Brand, so around 62 per cent respondents opt for

it to identify the bag. Because it is easy to describe the logo like Kamal Cement and

the labor can easily remember and recognized the logo.

Where as 18 per cent dealers think that labor would identify the bag with the help of

colour. It is only because the Brand like Binani Cement comes in the different colour

than any other company brand.

At last 20 per cent labor were able to identify the bag with help of colour of Brand

name.

While the Structure of the Logo is not much recognized by the illiterate labor.


LIKENESS OF THE CRITERIA FOR CEMENT

Criteria Customers Dealers

ISO Quality 18 23

Brand Name 22 9

Advertisement - 2

Price 5 2

Strength 5 14

Table No. - 13

Chart No. - 5

INTERPRETATION

Every Dealer must know that they have to sale the cement on some criteria. So the

likeness of the criteria differs with each dealer. Some believe in Strength while some

believe in ISO Quality. For any company to know about this is very important. In the

same way demand of the consumer is also important. This comparison will give the

important data about the thinking of both.


There are mainly 5 criteria as mansion in the table.

Most respondent emphasizes on the ISO Quality, they think that the Quality of the

brand is very important and in the same way most of there consumer wants the Quality

only. As the respondent were the retailers, they sale large and small scale cement

together. So, for them it is very important to convince the consumer about the Quality.

The data shows that 18 out of 50 consumer wants Quality and 23 out of 50 dealers

believe in the Quality is must for sales.

The second most important criterion is Brand Name. Many dealers believe that most of

the consumer purchase cement only because of the Brand Name. So according to the

table we can say that 44 per cent consumer purchase cement on the Brand Name. While

only 18 per cent of dealers’ sale the cement on Brand Name.

The third important criterion is Strength of the Cement. According to the survey 28% of

the dealers believe in the strength. While only 10 per cent consumer purchase the

cement because of the strength.

Price and Advertisement are not much important according to dealer and consumer also.

Here only 4 per cent of the dealers think that advertisement is important in the sales of

cement. The price in not so much important to both because only 10 per cent consumer

think of this factor, while only 4 pre cent dealers think of the price factor.


IMPORTANCE OF THE BRAND NAME

Table No. - 14

Chart No. - 6

INTERPRETATION

According to the survey 100 per cent respondent believe in the Brand Name, but there

thinking is different in the important.

Different View Response in %

Not much Important -

Less Important -

Average 20%

Important 52%

Very much Important 28%


Here around 20 per cent respondent believe that the Brand Name is Average important,

because they can convince the consumer to purchase the small scale cement though it

wasn’t branded.

Another 52 per cent respondent believe that the Brand Name is Important, because of

the demand of the consumer.

While 28 per cent respondent believe that Brand Name is Very much Important,

because the consumer will only purchase Branded cement.


DIFFERENT PROMOTIONAL ACTIVITIES Table No. - 15

Chart No. - 7 INTERPRETATION

Target based Prize is very much important according to the respondent because, around

42 per cent of them have the same idea about the sells. They believe that the Target

based Prize will increase the sale because it motivate the dealers to sale more and more

bags of the cement and get the good Prize from the company.

Promotional Activities Response in %

Quality Discount 8%

Free Gift 4%

Advertisement 8%

Dealers- customers Meeting 38%

Target Based Prize 42%

Others -


Customer meeting comes to second place with around 38 per cent response. Respondent

believe that if the company will arrange the meeting with customers like Contractors,

Engineers and masons than the sales of the cement will automatically increase.

Quality Discount and Advertisement comes on the third place with less response of only

8 per cent each.

Free Gift at the last place because, the respondent believe that it is not so much

important and it will not affect the sales if you give gifts to masons and all other

consumers.


MEDIA VEHICLE FOR ADVERTISEMENT

Media Vehicle Response in %

Television 50%

Radio -

Hoardings 10%

News Paper -

Wall Paintings 40%

Bus / Tractors Paintings -

Table No. - 16

Chart No. - 8

INTERPRETATION

Among all media vehicle Television is the best media according to survey. Respondent

believe that many consumer purchase cement only because of the advertisement in the

television. Around 50 per cent respondent think that small scale cement manufacturer

also has to give the advertisement in the television.


Wall Paintings stand on the second with around 40 per cent response. Dealers believe

that in villages it is very important and many consumers are aware of cement only

because of the wall paintings.

Hoarding stand on the last with only 10 per cent because, it is not much famous in the

villages of the Saurashtra Region.

While Radio and News Papers have not given important as a media vehicle for cement.


BRAND POSITIONING STRATERY

Positioning Strategy Response in %

Comprehensive Strength 22%

Consistent Quality 50%

Durability and Long Lasting 28%

Low Water Consumption -

Others -

Table No. - 17

Chart No. - 9

INTERPRETATION

Almost 50 per cent of the respondent believes that the Consistent Quality should be the

most powerful attribute for consumers of cement. They believe that all consumers want

the same quality in each bag of the cement every time they purchase it.

The second place goes to the Durability and Long Lasting of the cement. Respondent

says that the cement must have durability because; the consumer will not build their


home now and then. According to survey approximately 28 per cent of the Respondent

believes that Durability is the powerful attribute for consumers.

The last place goes to the Comprehensive Strength will be the good attribute for

consumer with around 22 per cent.

While Low Water Consumption is not recognized by the respondents because; they

mostly deal with the consumer of village who didn’t believe in this factor.


MEDIA TO AWARE IN CHANGE OF BRAND NAME

Media Vehicle Response in %

Television 52%

News Paper 24%

Hoardings 8%

Banners -

Wall Paintings 10%

Handout 6%

Radio -

Others -

Table No. - 18

Chart No. - 10 INTERPRETATION

As Television is given the best media vehicle in other chart here also the respondents

give it the first palace with approximately 52 per cent. They believe that if the company

changes the Brand Name then they have to advertise in the television. So that the

consumer can easily know about it. Here the best example is of UltraTech Cement.


News Paper comes on the Second place with around 24 per cent. Respondents believe

that it is the simple way to aware about the change and also it is cheaper than

Television.

Wall Painting comes at the Third place with approximately 10 per cent.

Hoarding and Handout comes at Fourth and Fifth place respectively. Here Hoarding

gets the 8 per cent and Handout gets 6 per cent because they are not so much popular

for the cement industry.

While Banners and Radio are not recognized by respondent because they are not so

much important for the advertisement of the cement.



FINDINGS

UltraTech Cement is most famous in the Saurashtra Region.

Consumers are more focus on the Brand Name and Quality of the products.

Most of the literate consumer looks on beg for ISI symbol. In this way the consumers

are well aware of the Quality of cement.

Most of the illiterate labor finds out the particular brand with the Logo.

Mostly consumer and dealer memorize the name of the brand based on the Character

Here 100 per cent of respondent believe that Brand Name is important for any cement

company.

78 per cent respondents are aware with more then fifteen brand of the cement (it include

the brand name of the small as well as medium scale industries).

As per the survey, Television is very successful media for an advertisement.



SUGGESTIONS

BRAND NAME

Present Brand name of the company is easy to remember. It has fixed its position in

top of mind recall. Different aspects which plays vital role to penetrate in the customer’s

mindset are as:

It is very short (i.e. it has only two characters).

Very easy to pronunciation.

Present Logo which automatically includes Company name & Brand Name.

The customer asks for cement on its Brand Name then a second criterion for customer is

its Quality.


EQUITY OF PROBABLE BRAND NAME TO BUILT ON WHICH ASPECT

In present scenario company’s Brand image stands for Quality cement. Hence

considering the product, probable Brand Name to be built on the aspect like;

It should reflect the strength.

Name should reflect the Ruggedness and Toughness.

New name should be short; it should be of maximum 2 to 3 characters.

Company’s Brand Name should be short enough that can be included in its Logo. It is

visual signature of the Brand Name. For a human mind 60% learning is done through

diagrams, pictures or shapes.


STEPS NEEDED TO ENSURE SMOOTH TRANSITION FROM ONE BRAND NAME

TO OTHER BRAND NAME

The company should start heavy advertising before effective date.

Advertising should continue for next 3 to 6 months on TV at particular frequency at the

same time on Newspapers on daily basis on front page or full page in between.

if present brand name is ABC & new name is XYZ then advertising should be as “

ABC” now becomes “ABC XYZ “ and slowly as the time passes ABC should become

small font size with dull colour and XYZ should become large font size with bright

colour.

For electronic media ABC should gradually become small and finally disappear in new

Brand name XYZ. So that will create an impact in the customers mind.

ABC → ABC XYZ → ABCXYZ → XYZ


EXPECTATIONS OF NETWORK ABOUT NEW BRAND, ITS ADVERITSEMENT

AND SALES PROMOTIONS

New Brand’s advertisement should be continuing at least for 6 months.

To aware the customer for change of brand name advertising should be done through

TV and News papers.

Most emphasis should be on free gifts as part of advertising and promotional mix

strategy.

These free gifts will create the awareness for new Brand name among its users i.e.

masons, engineers, contractors. This is first stage for awareness.

The second steps should be of importance of customer meetings with dealers, masons,

contractors, and engineers. This will help to get the orders i.e. to increase the sale.

Promotional items (calendars, diary, pen, & other stationary) along with company name

should also carry the name of dealers or stockiest in small size of fonts, that will build

the relationship with contractors, masons, engineers.



CONCLUSION

Most of the consumers and dealers in Saurashtra Region are very familiars with

different brand of the cement.

But they purchase the cement based on the Quality and Brand name of the cement.

Television is the best media vehicle for the advertisement of the cement industry.

Those respondents who can convince the consumer will sale any cement though it is

large scale of small scale.

Those consumers who want to purchase qualitative product of cement they choose

branded one only.

Cement industries in the Gujarat state is number 1 (one) position to pay VAT to the

Government.

More than 90% of the respondents are familiar with more then 10 brand of the cement.


BIBLIOGRAPHY

REFERENCES

List of Books

Philip Kotler: “Marketing Management”, eleventh Edition, Pearson Education, New Delhi,

2006

Kothari C. R.: “Research Methodology”, Wishwas Prakashan, New Delhi, 1996

Rajan Saxsena: “Marketing Management”, third Edition, Tata Mc.Graw Hill Publishing

Company Ltd., 2004

List of Magazine

“Indian Journal of Marketing”, New Delhi.

“The Icfai University Journal of Marketing Management”, University Press, Hyderabad.

“The Icfai University Journal of Brand Management”, University Press, Hyderabad.

List of Websites

www.lntcement.com

www.domain-b.com/companies

www.qestionpro.com

www.cemnet.com

www.ceicdata.com


QUESTIONNAIRE FOR THE

RETAILERS/DEALERS/STOCKIEST

Dear Respondent,

I am student of J. V. Institute of management studies (Jamnagar), doing survey for small

scale cement industry. I will be thankful to you if you please fill the following.

(1) Please mention the Brand name of the cements with you aware.

1. [ ] Associated Cement Company 2. [ ] Gujarat Ambuja Cement

3. [ ] India Cement 4. [ ] Madras Cement

5. [ ] Sanghi Cement 6. [ ] UltraTech Cement

7. [ ] Hathi Cement 8. [ ] Kishan Cement

9. [ ] Major Cement 10. [ ] Rambo Cement

11. [ ] Sathi Cement 12. [ ] Tapi Cement

(2) The Advertisement of the Cement Company’s does you like most?

1. [ ] Associated Cement Company 2. [ ] Gujarat Ambuja Cement

3. [ ] India Cement 4. [ ] Madras Cement

5. [ ] Sanghi Cement 6. [ ] UltraTech Cement

7. [ ] Hathi Cement 8. [ ] Kishan Cement

9. [ ] Major Cement 10. [ ] Rambo Cement

11. [ ] Sathi Cement 12. [ ] Tapi Cement

(3) Which aspects of the Advertisement do you like the Most? (Especially for cement)

1. [ ] Name 2. [ ] Character

3. [ ] Logo 4. [ ] Slogan

5. [ ] Colour 6. [ ] Others

(4) Is Current Brand name easy to remember?

1. [ ] Yes 2. [ ] No

If yes, why?

1. [ ] Name Itself (Company Name) 2. [ ] Pronunciation

3. [ ] Logo 4. [ ] Tag-line

5. [ ] Colour 6. [ ] Others


(5) Which sign/aspect you ask your Labor (Illiterate) to identify the cement Bag?

1. [ ] Colour of bag 2. [ ] Logo of the cement

3. [ ] Colour or brand name 4. [ ] Structure (Shape) of logo

(6) What are the criteria for you to sale the cement?

1. [ ] ISO Quality 2. [ ] Brand Name

3. [ ] Advertisement 4. [ ] Price

5. [ ] Strength

(7) What criteria the customer considers at the time of purchase of cement?

1. [ ] ISO Quality 2. [ ] Brand and Name

3. [ ] Advertisement 4. [ ] Price

5. [ ] Strength

(8) How the brand names play an important role in order to sale the cement?

1. [ ] Not much important 2. [ ] Less important

3. [ ] Average 4. [ ] Important (Good)

5. [ ] Very much important (Very good)

(9) Which types of Promotional activities contribute in increasing sales?

1. [ ] Quality Discount 2. [ ] Free Gift

3. [ ] Advertisement 4. [ ] Dealer/ Customer meetings

5. [ ] Target based Prize/Gift schemes 6. [ ] Other

(10) According to you which is powerful media for an advertisement of the cement?

1. [ ] Television 2. [ ] Radio

3. [ ] Hoardings 4. [ ] News-paper

5. [ ] Wall Paintings 6. [ ] Bus / Tractors Paintings

(11) What should be Positioning Strategy on a specific attributes for Consumers?

1. [ ] Comprehensive Strength 2. [ ] Consistent Quality Assurance

3. [ ] Durability and Long Lasting 4. [ ] Low water Consumption

5. [ ] Others


(12) If Company Changes the Brand Name, Which media Play Crucial Role for awareness of

the consumers?

1. [ ] News Papers 2. [ ] Handout/ Lea flat

3. [ ] Hoardings 4. [ ] Banners

5. [ ] Wall Paintings 6. [ ] Television

7. [ ] Radio 8. [ ] others

(13) How many bags of cement you sell every month?

A). Large scale cement

1. [ ] Less then 500 2. [ ] 500 – 800

3. [ ] 800 – 1000 3. [ ] More then 1000

B). Small scale cement

1. [ ] Less then 500 2. [ ] 500 – 800

3. [ ] 800 – 1000 3. [ ] More then 1000

(14) How much time dose the companies take to fulfill your requirements?

A). Large scale cement

1. [ ] 1-7 Days 2. [ ] 8-15 Days

3. [ ] 1 Month

B). Small scale cement

1. [ ] 1-7 Days 2. [ ] 8-15 Days

3. [ ] 1 Month

(15) Who is your regular customer?

1. [ ] Engineers 2. [ ] Contractors

3. [ ] Builders 4. [ ] Common man

Documents

RETAILERS PERCEPTION TOWARDS THE SMALL SCALE CEMENT