Executive Summary
Business Description
National Cement Company PSC (NCC) is a cement manufacturing plant situated in Dubai, United Arab Emirates and currently listed on the Dubai Financial Market. NCC started operations on 10 April 1968 under the directive and supervision of its founding members. The publicly traded entity synthesizes and vendors cement and related commodities such as white aggregates and clinkers in Saudi Arabia, the UAE, and generally across the globe. Over and above that, NCC also deals with investment securities in conjunction with derivative products. The progression and eventual success of NCC is a story of allegiance, dedication, and unwavering commitment implemented by the suppliers, investors, employees, and the community as a whole. The company is looking to erect a grinding unit of 1.5 million tons capacity in Riyadh, Saudi Arabia. The Grinding Unit at Saudi Arabia will elevate sales for NCC considering that the region accounts for almost 55% of the total sales and revenue.
Ownership and Management
The ownership and management of the NCC entity falls under the Al-Ghurair Family who also double up as the founders and shareholders. The executive suite charged with the responsibility of chaperoning the Grinding Unit Project consists of the Sales Manager Salah Sulieman, the Finance Manager Johar Abbasi, and the Secretary & Compliance Representative Ahmad Ali Abdul Dayem Ahmad.
Key Initiatives and Objectives
The company’s pivotal initiative and trade philosophy seeks to suffice the needs, preferences, and wants of their clientele. The processing cement and ancillary wares is the entity’s fundamental endeavor that aims at the provision of fast turnaround, competitive pricing, exceptional quality, and unsurpassed customer service to the clients. As regards the erection of the Grinding Unit, NCC seeks to score various objectives such as higher energy efficiency, system simplicity, and discount of the high power consumption. More importantly, the project aspires to augment quality assurance as well as depreciate the cement production cost by way of implementing inexpensive raw materials.
Marketing Opportunities
Marketing opportunities embody efficient approaches to trade and business, and NCC alludes to an indigenous philosophy that grants stakeholders the freedom to cast their own goals and ambitions. The philosophy zooms in on two central elements namely quality of the commodities and services as well as safety assurance of the participant human resources.
Competitive Advantages
The company employs credible competitive advantages that grant it leverage against its contestants such as the perpetuation of exemplary long term economics that facilitate generation of high gross margins. The upcoming Grinding Unit Project aims to better advance the entity’s gross margins and overall revenues since the core objective is to cut back on the production costs. Minimization of production overheads culminates into laudable revenues and magnification of product review.
Market Strategy
The grand design considered by NCC to reinforce and merchandise the sale of its cement stocks is through exploitation of the e-commerce platform. The Head of Sales and the corresponding directorate have resolved to market the company online to reach a greater aggregation of the third generation patrons. The marketing department has collaborated with a design firm to engineer a practical website featuring a Virtual Design Center that will include custom quotes and interactive chats to submit questions. As regards market penetration, the company engages in charity events, sponsorships, internships, career promotions, and publicity campaigns conducted by the sales and marketing personnel.
Summary of Financial Projections
This segment outlines a condensed summary of the financial forecast formulated to display the project cost (investment cost), production dues, projected income, and payback period. The estimated duration for the plant construction is one year. The chief financiers for the venture will be 70% debt financing loan, whose calculated bank interest rate is 7.5% and 30% equity funding. The projected initial project price tag is AED 95.89M (redeemable within 6 years), where the foreign share shall account for 88.39% of this value. The aggregate production overhead is AED 339,525, of which 65.1% and 1.3% account for the raw inputs and maintenance costs respectively. With reference to the approximated income statement, the Grinding Plant should start yielding financial gains within the initial inauguration year, thus approving of its viability.
Business Overview
Business History
National Cement Co. is a UAE-stationed institution involved in the mass production and barter of cement and its complementary products. NCC’s manufacturing plant boasts year-end production capacities of tons of cement exceeding 1.5 million. The firm distributes its produce and materials to the United Arab Emirates as well as the Gulf Cooperation Council (GCC) markets. The company first opened its doors in 1968 under the surveillance of the late H.H.Sheikh Rashid, who visualized the development of sound avenues for multinationals using territorial resources. Accordingly, the founding members- the Al Ghurair Family- instituted the entity to furnish base materials to inflame the flourishing construction upsurge encountered within the UAE region.
Vision and Mission Statements
The multinational firm embraces a gratifying vision statement that contemplates on a relentless pursuit in the appliance of state-of-the-art technologies and steadfast innovations. The ultimate price of NCC’s vision, especially with the forthcoming grinding unit venture, is to secure the public contentment and pride of its customer base. On the other hand, the mission statement details production strategies that will ensure the entity outputs 3 million MT and crown NCC as the prominent cement producer in the UAE.
Location and Facilities
NCC’s base of operations is at Al Quoz First, an industrial locale in the southwest of Dubai. The offices for the forthcoming venture will be at Al-Tahlia Street, in Riyadh city, Saudi Arabia. The elite management as well as the CEO will be apportioned office suites in these project workstations while the marketing and administrative faculty will run operations from the sales office. The prerequisite auxiliary facilities for the plant encompass ball mills, calcined bauxite, industrial crushers, calcined lime, rotary dryers, and the steel grinding media. The procurement executives will handle purchase of these facilities, either locally or through import.
Products
Description of Products
This segment provides a comprehensive explanation of the aforementioned products. Production of tailor made goods in terms of design and quality as per requirement of the concerned authorities in hydroelectric power project and other private customers.
Ball Mill
A ball mill entails a unit operation devised to implement secondary crushing by way of breaking solid components into finer powder. This pulverizer is extensively indispensable in atomizing numerous mines and substances including fireproof material, silicate products, glass, ceramics, chemical fertilizers, and cement. More importantly, manufacturers adore the ball mill as it guarantees low operating costs, easy upkeep, high productivity, and steady operation.
Rotary Dryer
The rotary dryer refers to an apparatus employed to drain all the liquid humidity contained within the component in question by prompting direct contact with a fiery gas. This accessory is suitable to wilt the clay element in cement, the slime in coal mine as well as nonmetallic minerals.
Steel Grinding Media
The steel grinding implements are best applicable in chambers consisting of immense chemical resistance, colossal heat generation, and a great deal of wear and tear. The Chrome Steel Grinding equipment is highly sought-after considering it is of significantly high relative density, hardness, as well as unsurpassed proficiency in blending heavy materials.
Industrial Crusher
The industrial crushers prevail to mash large solid objects into minor fragments and exist in various types such as Mobile Impact Crushers, Spring Cone Crusher, and hammer mills. The beneficence of these crushers is that they are straightforward to handle, long lasting, and affordable sustenance.
Calcined Bauxite
Calcined Bauxite involves a pure fusion of iron hydroxides and aluminum for use in the manufacture of abrasives, refractory bricks, as well as steel polishing.
Calcined Lime
The Calcined Dolomite Lime evolves from ignitions in gas kilns and is applicatory in the fabrication of stellar products administered as external impurities.
Key of the Products
All the previously mentioned facilities are mandatory and the procurement agents will be keen to certify that the products have a 10-year surety in conjunction to being of high-end conditions. Should an imported appliance be defective, the acquisition department will replace it with zero processing fees.
Achievement of the Services Provided by the Company
Administration of the new venture seeks to consummate a multitude of services and utilities consisting of technology exploitation, commissioning of new expertise, improved reputation, and new processes. The new grinding plant will additionally seize enhanced profitability, targeted markets penetration, and increment of financing and investments. Equally important is escalation of product quality and instant accession to the patrons by way of incorporating a customer service helpline within the aforementioned Virtual Design Center.
Future Products
Once the grinding unit suffices its forecasted expectations, NCC will employ additional products and services to heighten its revenues such as construction of architectural concretes, pavements, countertops, and decorative floors. In addition, it will also engage in the foundation of roller-compacted and high-strength concrete.
Comparative Advantages of the Company
NCC’s strongest comparative advantage is the particular attention it places on high quality products assisting the corporation to gain a public advantage on the account of the superiority of the cements they expend. This project targets to safeguard against natural resources in conjunction with securing low pollutant exudation rates. Furthermore, NCC has attained several environmental and safety accreditations that serve as justification tools for the entity to set the required specifications for environmental obligations, quality, and quality in its regions. It also exceeds expectations by way of acquiring and dispensing supreme merchandise inspected by a proficient workforce as well as the management team, who have persisted in this commerce for durations stretching past ten years.
Market & Sales Analysis Strategy & Plan
Competencies
The delegated project team has the mandate to conform to specified competencies consisting of low capital costs, rock-bottom power depletion, prime utilization of process heat, and long service life attributable to the products. For transportation purposes, the company’s administration faculty will hire five service vans that will ferry the machinery back and forth and in accompaniment of relevant technicians. Only through orthodox procurement of quality facilities and inputs shall the manufacturing firm be able to output well-crafted wares and goods.
Customers
NCC has listed a number of purchasers and potential markets for its upcoming commodities such as road constructors, bridge foreman, and the heads of building projects. Over and above this, the marketing department is targeting private housing projects, hardware stores, and hydroelectric power projects.
Geographic and Demographic Aspects
The chosen location, Riyadh, is Saudi Arabia’s metropolis and is very vast in size considering it seats at the middle of the Arabian Peninsula- situated on an enormous plateau. The tableland harbors a population of 5.7 million with the urban center hosting close to 7.3 million townsfolk. Following the region’s population in the 1960s, which consisted of 150,000 dwellers to the present-day population of 5 million and above, the highlighted sector is bound to grow and be home to droves of residents. The cosmopolitan city houses CEOs, technocrats, ambassadors, and other dignitaries in addition to the local residents whose active lives shift from offices. Therefore, the idea of land marking Riyadh as the project construction site depicts a good business opportunity as the sizable population will appreciate the tremendous construction activities. Infrastructure is the cornerstone of any nation’s economic growth as it establishes the mainstay structures of all financial systems.
Behavioral Factors
Riyadh is popular for numerous construction projects considering it is the leading metropolitan in terms of developments and infrastructure. By delving into erection of the grinding plant, NCC will be instituting its niche in the combative market. The building scene of the budget unit should ideally be near the capital construction loci such as Jeddah, Dammam, Khobar, Jubail, and Jizan. In addition, Riyadh Province is the present setting for the mightiest ongoing power venture and as such, it will necessitate cement-based products such as grinding plants, industrial crushers, and steel grinding media.
Market Strategy
The projected market strategy will embody how the entity will distribute its products and create awareness of its brand by way of advertisements and promotions. The distribution methodology encompasses wholesalers, tender sales, direct customer depots, government units, and institutional sales. In addition, the firm plans to award dealership to individuals in territories where the enterprise does not have any representation. The ultimate marketing tactic is to escalate transactions in high realization by creating efficient distribution networks and final outlets consisting of dexterous application engineers and sales personnel.
Target Market and Analysis of Competitive Position
The target market envisaged by NCC’s Head of Sales includes building projects, bridges, and road constructions. On top of this, the marketing department has also singled out private housing projects, hardware stores, and hydroelectric power projects. As regards the analysis of competitive positions, the project team guarantees the production of customized wares with respect to the stipulated design by the hydroelectric project authorities and other exclusive buyers. In quest of a competitive advantage, the multinational company also pledges minimal transport costs of purchased goods from its stores to the customers’ construction sites. The procurement and logistics faculty will carry the mandate of increasing the value addition on inventory control, stocks, and other local resources.
Pricing Strategy
After extensive market research, the finance department has designed a tactful but tentative pricing list for the budgeted-for grinding aids (see table 1). The pricing policy takes into account the transportation, material handling, and storage costs to facilitate the most appropriate cost allocation for its customers.
Table 1: Pricing List for Grinding Aids
Promotion Strategy
The company has scheduled to fuse two major promotional means namely advertisement through public relation firms and awareness through its marketing and sales branch, in the introductory operational year. Equally important is commodity publicity by way of enlisting ecommerce platforms, blogs, websites, social media such as Facebook, print media including newspapers & brochures, fan pages, and interactive chatter feeds to capture all promising clients. Table 2 displays NCC’s promotion tactics and advertisement overheads.
Table 2: Cost for Print Media Advertisement
Management & Staffing
Organizational Structure
Figure 1 below displays the organizational structure of the firm that will be in control of the forthcoming project in Riyadh, Saudi Arabia. It outlines the senior management team, covering CEOs and all the heads of the engaged departments. The on-field workers are inclusive of the administrative and operations workforce.
Management Team
The selected management teams that will command the project undertaking are as listed below:
- The CEO, Mr. Mohammed Abdullah Ahmed Al-Ghurair
- The Chairman, Mr. Abdulla Ahmed Majid Al-Ghurair
- The Sales and Marketing Manager, Mr. Salah Sulieman
- The Finance Manager, Mr. Johar Abbasi
- The Secretary, Mr. Ahmad Ali Abdul Dayem Ahmad
Staffing
Table 3 beneath details the selected staffing pattern in charge of the task.
References
Chennoufi, L., Hoagland-Grey, H., Breisinger, M., & Boulet, E. (2010). Cement manufacturing plant guidelines: An approach to reconciling the financing of cement manufacturing plants with climate change objectives. Web.
IDRG Consultancy Services. (2009). Detailed feasibility analysis of cement based products. Web.
Interim condensed financial statements. (2014). Web.
Kumar, K., Chhangani, P., & Garg, R. (n.d.). Process optimization: An effective tool for cost reduction. Web.
Mini-Cement plant. (n.d.). Web.