It is about supply chain management.

1. Welcome To
Our
Presentation
1

2. 2
Participants:Participants:
Mehedi hasan Roll No: 159
MD.Abdur Rakib Roll No: 151
Md. Masudur Rahman Roll No: 147
Sheikh Abdullah al mamun Roll No: 149
Arafat Abdullah Roll No: 71

3. Topic:Topic:
Supply chain management of
RAK ceRAmics BAnglAdesh
ltd.
3

4. 11/30/15
OBjectives
 An over view on RAK Ceramics
 Overall value chain process of RAK Ceramics
 Primary activities of RAK Ceramics (like starts
from supply chain management to delivering
products to the end user)
 Support activities of RAK Ceramics.

5. 5
Mehidi Hasan
Roll: 159

6. Company overview
RAK ceramics UAE:
RAK a global ceramic multinational is in the
Ras Al Khaimah. It is a public shareholding
company with H.H. Sheikh Saud Bin Saqr
Al Qassimi. He is the Crown Prince &
Deputy Ruler of Ras Al Khaimah as the
Chairman and Dr. Khater Massaad as the
Chief Executive Officer. It has worldwide
sales of over USD one billion. To build a
world standard for quality and beauty, the
company basically starts manufacturing.
They start their first production in 1991.
Within 19 years it became a world class
organization.

7. Company overview
RAK Ceramics (Bangladesh) was incorporated in 26
November, 1998. It is a joint venture company with UAE. It
was first incorporated as a public limited company. Now it is
public limited company and changed its name from RAK
Ceramics (Bangladesh) Private Limited to RAK Ceramics
(Bangladesh) Limited on 10 June, 2008. They are now
manufacturing ceramics tiles, bathroom sets and all types of
sanitary ware

8. Logistics activities
1. Transportation
2. Inventory
management
3. Order
processing
1. Warehousing
2. Purchasing
3. Packaging
4. Materials
handling
Primary activities Secondary activities

9. Inbound logistics:
 Raw materials Acquisition
Clay
Color Pigment
Cerfrit

10. 10
Abdur Rakib
Roll: 151

11. Raw material Suppliers:
90% of raw materials of RAK ceramics is
are imported from outside the country. The
main raw materials supplier of RAK is
Global Business Association (GBA) and the
supplies are dealt in ordering process. GBA
is a sister concern of RAK and it also
supplies raw materials to other company’s
also. RAK places an order of the list of raw
materials and GBA supplies the raw
materials. Cerfrit a company from Spain
supplies “cerfrit” for using in colors. Color
pigment is supplied by GBA which is
collected from Italy.

12. Shipment of Raw materials
(Transportation):
After placing the order to GBA, raw materials are sent by ship to Chittagong port
and sometimes in Naryanganj from Chittagong port. From there Cargo trucks are
used to carry the clay to their production plant. Spare parts for their machineries
are collected from “SACMI” which is a giant of manufacturing machines and
completing plants and it’s an Italian company.

13. Shipment of Raw materials
(Transportation):

14. Transportation cost:

15. Inventory Management:
The inventory management job is mainly assigned to Store department
and accounts department. Accounts department is in charge of raw materials
inventory. Raw materials are purchased and stored in the amount of 6 to 7 months of
production. Store department is in charge of the management of finished goods
inventory. RAK takes extra precautions for not damaging or wasting raw materials and
extra security for preventing the risk of theft

16. Inventory Management (continued):
RAK ceramics have the most advanced production facility for producing tiles and
sanitary ware. They have one production plant for tiles which covers all the
production activities. RAK also have a Design Development Program under R&D
department which helps to create new design for the customers. In this
department, RAK have invested a huge amount to gain advantage over
competitors in designing. They are using SACMI technology in their production
plant which comes from Italy.

17. 17
Masudur Rahman
Roll: 147

18. OutbOund LOgistics
Outbound logistics deal with distribution of finished goods.
 Pull and Push Demands of finished inventory:
Rak has push demand philosophy. Normally it determines a steady demand of
tiles. According to demand, it supplies tiles to 38 dealer, 38 dealers supply to
various sub-dealers and to customers. RAK use forecasting models like
moving or weighted moving average to determine their demands. Moreover it
uses pull strategy to supply industrial users.

19. Distribution Process:
 RAK ceramics follows simple distribution process to get
products to end users by minimizing complications. They follow
4 level distribution channels which consist of manufacturer,
dealers, sub dealers, consumers.

20. Distribution Process:
 RAK follows selective distribution which means they distribute
products only few distributors. They don’t have their own
distribution channel; they use dealers to distribute their
products. Currently RAK has 38 dealers all over Bangladesh.

21. Distribution Process:
They directly control their dealers
through 4 state managers in six
divisions. Dealers are allowed to
appoint sub dealers to sell RAK’s
product but RAK does not control
them.RAK ceramics distribution
process starts from stock department.
Stock department stores finished goods
in the warehouse. Dealers are informed
from the warehouse that their goods
are ready for delivery and they arrive to
receive the delivery from warehouse for
distribution.

22. Supply of finished goods
(Transportation)
 RAK does not have its own transportation mode for distribute tiles.
38 dealers of whole country uses their own transportation mode.
Sometimes it distribute tiles to industrial users using rented truck. It
determines transportation cost 4 taka per square feet

23. Order cycle:
RAK has a unique order cycle procedure. It has weekly demands of
more than 4,00,000 square feet. That’s why it keeps 2,20,000 square
feet safety stock(Calculation is given to next slide). When orders come
on hand, it takes 1 or 2 days to process them. Dealers keep 1 day to
take inventory to their warehouse. For arriving to customers, it takes
another 3 days. So total order cycle time is 7 or 8 days.
1 day
Retailer
Outlet
Dealer
Dealer RAK
Warehouse
1 day 1 day
1day
3 day
Factory
0day
5 days

24. Safety stock calculation
 Average daily demand = 57,143 sqrf per day (4,00,000sqf / 7)
 Maximum daily demand = 84,580 sqrf (recorded in 12 October, 2014)
 Lead time = 8 days
 Safety stock = (Maximum Daily Demand − Average Daily demand) × Lead Time
= (84,580 – 57,143) × 8
= 2,19,496 ~ 2,20.000 sqr feet

25. Logistics product
Logistics products three types: convenience product,
shopping product and specialty product. Tiles are shopping
product as they are purchased after careful investigation and
brand comparison. For this reason, RAK makes all
information about tiles available on its website

26. Pricing strategy:
 RAK follows uniform pricing strategy. It uses the term ‘maximum retail
price (MRP)’ to sell in same all over the country
Warehouse:
• RAK has two warehouses at Gazipur beside its production house. One
for storing raw materials and rest is for storing finished goods.
Warehouse is established to conduct indirect sales. Goods are stored
into warehouse according to the distributors’ requirement. Supply the
goods to the distributors by checking invoice. The local distributor that
is the distributors of Dhaka City collects products by their own
arrangement

27. 27
Abdullah al Mamun
Roll: 67

28. Materials handling
 In Gres Procellanato (porcelain / fully vitrified tiles), the company
produces hundreds of glazed and unglazed porcelain, covering finishes
such as polished, unpolished, rustic, Slate etc.
In Bangladesh with three fold expansion Drive Company has reach
capacity to produce over 8 million square meters of tiles per annum &
has over 1000 different tiles models recipe

29. Latest equipment &
technological application:
Some unique patterns and finishes: are acquired through new
technologies such as Roto Printing, Double charge, Granitech
etc. Some unique “antique style” finishes and many
specialized finishes in tiles have been possible due to such
advanced Gres Procellanto technology

30. Modern European machinery:
Computer controlled guided vehicles transferred semi
finished goods from station to station, robots picked and
placed semi finished tiles in many production steps as well as
in sorting and packing the finished tiles, skilled technicians in
sophisticated control rooms monitored raw materials in
blending mills, wet and dry grinding vessels, presses, kilns,
drying and cooling cycles, and many other operations

31. Ceramist R& D activity:
 Active team of ceramist to challenge customer demand & device cost
effective input recipe solutions
Recently RAK introduced
Robotic Sprayer for glazing on
the surface of Tiles. Moreover,
Double Flushing, Soft Closing
Hinges, Spreader of urinal bowl
are the exclusive accessories.
RAK is also producing all type
of seat & cover ourselves in our
factory

32. Marketing, sales and
service:
 RAK ceramics is the market leader in ceramics production in Bangladesh.RAK
ceramics mainly emphasize on commercial production for meeting domestic
demand but they also have industrial production which is not in massive
condition due to low demand and huge affordability issue by industries in
Bangladesh. But if a company places order for industrial tiles they fulfill their
demand. RAK have a good marketing department for marketing which is in the
main headquarters in Uttara. RAK ceramics sales force is mainly used to
convince owners of industry firms to use RAK ceramics because industry
productions of ceramics product have high durability and price.

33. Marketing, sales and
service:
 To provide good support to these buyers, the sales force is mainly used for any
complaining and ordering and also providing important information. The process
mainly starts from industry placing order with specifications to dealers of RAK,
sales force contacts with the buyer to provide more specific information and
details along with pricing and choice, sales force confirms their specifications
and sends it to RAK. RAK ceramics go to the production and send their product
via dealer to the desired person. This is the role of sales force which plays a vital
role in selling industrial products. RAK ceramic doesn’t use any direct selling in
marketing, if a customer place order from RAK head office where they have a
showroom, then instead of selling directly to them RAK provides reference of
nearby dealers to their location for providing convenient support. As it is
mentioned before, RAK ceramics uses sales force for industry buyers and
dealers reference for normal customers.

34. Marketing Research and
Planning:
 RAK display new design of tiles and sanitary wares in their
main head office for getting feedback from customer about
the new design. This new design mainly is the reflection of
ongoing global trend around the world or the new design of
RAK UAE which is a great success worldwide

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

36. Support from Dealer:
 RAK ceramics have 38 dealers around the country which are
handpicked by them after judging their portfolio. These dealers provide
great support to RAK for capturing and enabling the product to get
available in market. RAK ceramics tries to give full support on their
activities for making them more flexible and dealers also provide support
for making the product more available in market. From RAK’s point of
view, by the support, help and loyalty from these dealers have helped
them to spread the product in whole country and they also played a
huge role for their current market position

37. Service:
 RAK ceramics doesn’t have a specialized service center for customers
because it isn’t required in that extend. But they provide full support to
the customers by providing information and details of tiles before
purchasing to avoid deceptive selling