Durgesh Project Report

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Project Report On Marketing strategies and Distribution Channel For Marble Industry

Submitted to- Submitted by-

PARUL Inst. Of Management | Vadodra (Guj.)

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DECLARATION

I Durgesh Pandya a student of Parul Institute Of Management

Vadodra, hereby declare that all the information, facts and figures

furnished in this report are based on my own findings and experience

gathered during my summer training at HARI-OM Marmo Grani

Pvt.Ltd. This information has been used for purely academic purpose.

I hereby declare the work was done by me and suitable information

has been downloaded from websites and some gathered from the

company.

The project report is the result of my own hard work and self belief.

Signature of Student

Name:

Date :


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ACKNOWLEDGEMENT

An effort is not complete and successful till the people who make it possible are given due credit for making it possible. I take this opportunity to thank all those who have made the endeavor of mine successful for me and for all

The entire journey from the very idea of this project to reality would not have been possible without the guidance of many experienced people. I would take this opportunity to thank my Company Guide, Mr. D.K. Kheda, chairman of Hari-Om marmo grani pvt.ltd. who guided me through the whole project and also smoothened most hurdles that I faced during the course of the project.and for the inputs that came in from you at all points critical, in the making of this project


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CONTENT

About Hari Om


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THE

COMPANY


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About Hari Om marmo grani

Chairman of Hari –Om marmo grani Pvt.Ltd. D.K. Kheda

Hari-Om marmo grani pvt.ltd is purely marble and granite production

company. With products ranging from different kind of marble and

granite. It serves customer in more than 5 countries. Hari – Om

marmo grani is focused on growth and committed to achieving

leadership in its business. It is organized into 2 other market focused

group 1.Haripriya enterprises 2.Bhilwara estate . This structure is

aimed at expanding the company’s growth capability and positioning

the company for sustained growth.

Commitment:

Hari-Om marmo grani is committed to serving the communities where we do business, providing our customers high-quality products


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and services and protecting the health of our workers and our environment

Social Performance

Hari Om marmo grani leaders and employees support the

communities that we call home.

Integrity

Our reputation for honest and reliable business conduct, built by so many people from past years, is tested and proved in each business transaction we make.


http://www.gepower.com/commitment/en/integrity.htm

http://www.gepower.com/commitment/en/social_perform.htm

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Environment, Health & Safety

We are committed to keeping our workers safe on the job and

ensuring compliance with environmental regulations.

HARI-OM marmo grani-

Hari Om marmo grani pvt. Ltd. Estd. In 2002. the company has

become a significant participant in a wide range of marble

Blocks Slabs and Tiles. As India moves towards its goal of

becoming a global leader, Hari om marmo grani is committed to

being a growth partner to India . At Hari-Om marmo grani, we

strive to be both a good and a great company. Every day, the

company strives to be a responsible corporate citizen, to

perform with integrity and to serve our employees and

customers responsibly


http://www.gepower.com/commitment/en/ehs.htm

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THE

PROJECT


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PREFACEOperating in today’s global landscape is different from the previous years due to the dispersed configuration of business activities. GPL (Globalization, Privatization, & Liberalization) has opened the doors for almost any business to go global. The core facilitators for such a drift are growth in the telecommunication sector, internet, availability of data, grounded infrastructure for business conduct, growing economy, easy & faster transportation system. Furthermore, tough competition has made the marketers to compete in terms of not only quality but also with respect to lower price & value added features. Along with the establishment of norms and standards in the “organized sectors”, A country such as India comprises of a huge “unorganized sector” of industries that fail to understand the current nerve of market. The “unorganized sector” comprises of industries that have not yet fully adapted to market forces and lack the degree of professionalism in business conduct. The aim of this thesis is to shed light on some of the challenges the unorganized sector faces. In order to do so, we have based our analysis on the Indian marble industry that comprises of players that are highly unprofessional and lack the capability to operate in a globalized economy.

Objectives –• To study this unorganized sector• Growth in marble products & its market size• Its domestic, as well as international market• Market focus of local producers. • Value chain of marble. • Missed opportunity• The future opportunity• Kinds of marble most demanded

EXECUTIVE SUMMARYA country like India is rich in natural resources, whereby, most of the exploitation of these resources is done by small & medium players. Up to certain extent the metal industry falls under the organized structure of its sector, the marble & stone industry still fall completely under unorganized sector category. The marble and stone industry in India constitutes of small local players that operate on informal and non-professional means of business conduct with feeble marketing constructs. These firms operate locally and are family-run.businesses having limited knowledge on the policies enacted by the Indian government and often run into financially unstable environment. En route to pacing developments in India, GPL (Globalization, Privatization& Liberalization) has helped many industries


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to restructure their activities and build competitive tools. India has its strength in these unorganized sectors as it employed a significant amount of its population in the rural India. Over the years, with governmental aid, some of the unorganized industries have been transformed into efficient industrial domains, whereby ,they have learned to adapt to competitive pressure emerging from multinational corporations (MNCs) and have set up a strong foot hold in the national market . The thesis efforts to study the value chain of the Indian marble industry and to indentify innovative marketing strategies for the same. Often it is the case in industries operating in the unorganized sector that they are deficient of a financial muscle and are not able to generate financial aid. The thesis further pinpoints the ongoing marketing strategies and the distribution channels of the marble industry. The industry, belonging to the unorganized sector, faces a few setbacks that have a negative impact on the profitability of the firms. Therefore, this document outlines a few strategies.whereby firms can further operate with reduced inefficiencies and significantly enhance their profitability by adopting professional means of business conduct.


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[1.] INTRODUCTION

1. 1 MARBLE INDUSTRY:- NATURE OF THIS SECTOR As far as India is concerned the marble industry falls under unorganized or informal sector. The unorganized sector constitutes a major proportion of Indian industries and the marble industry being one of constituents in this segment. The unorganized sector comprises of low skilled labor possessing no degree of specialization. Firms operating in this segment are crowded by uncertainties due to lack of documented information and the complexities in accumulating and managing industry specific resources. The National Account Statistics (NAS) report that the unorganized sector acts a strong production base for India economic indices and is yet neglected or unaware from taxation point of view due to its complex structure. Although the Indian government holds a huge number of articles for small scale & tiny sectors, yet their data is never known in exact terms because of the exclusion they have got in majority of tax applications. On the other hand, the organized sector possess detailed documents with descriptive statistics via the budget documents or reports etc. whereas, unorganized sector signifies those enterprises whose activities go without maintaining any regular accounts or regulation of any legal provision.

As per the NSSO (National Sample Survey Organization)’s survey during 1999-2000, only 28 million workers are employed in the organized sector out of total 397 million workforce & the rest of them lie in the unorganized sector. (INFORMALSECTORININDIA) Considering the world’s top three highly populated countries, i.e. Japan China & India they transformed the huge population lying in large numbers of villages & small industries in to a productive source through different strategies. Japan did it with its high skill in technology development via large sector & free market system, whereas in China each such unit meets the norms under its closed economic system.

India has a ‘mixed economic policy’ till date that follows a protectionist policy for the growth of these industries. Furthermore, these industries could not be widen because of the lack of an industrial infrastructure technological backwardness, uncertain market behavior, changes in the growth strategy with the arrival of an important development on a major scale etc.

Though, there is an advantage of its own kind in the rural unemployment & penniless too have had their pressures on the planners to let this sector a befitting status, at least to the extent that it appears on paper or is not neglected. According to Peter Drucker, ‘marketing’ is so basic that it cannot be considered as a separate function. It’s the thing seen from customer’s perception. For the understanding of the role of marketing, it is required to bring in matters like production, finance and personnel,


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1.2 MARBLE(A Dimensional Stone)The word dimensional stones refer to the durable stones which can be cut to sizes, polished & used for construction purposes, i.e. marble, granite, slates etc. These stones belong to a same family resulted from the combinations of different minerals such as calcium compounds (calcareous) for marbles, Silica compounds (siliceous) for granite & Shale clay for slate & it is the mineral base in these stones which distinguishes them from each other. Marble is a crystalline, compact variety of metamorphosed limestone, consisting primarily of calcite (CaCO3), dolomite (CaMg (CO3)2 or a combination of both minerals. The formation of marble takes place from the contact metamorphism of sedimentary carbonate rocks such as limestone, dolomite or metamorphism of older marble, thus it is a metamorphic rock. This chemical formation results in to an interlocking mosaic of calcite, aragonite &/or dolomite crystals from the recrystallization of the original rock. The fossils & sedimentary textures present in the original rock get destroyed due to the temperatures & pressures. The metamorphism of very pure limestone results in to a pure white marble, whereas clay, silt, sand, iron oxides, or chert present as a layers or grains in the limestone result in varieties of colored marble. Mineral impurities add color in multicolored patterns, though pure calcite is white. Wide deposits of marble lie in various countries like Italy, India, Pakistan, Spain, Greece, Brazil, China, Afghanistan, Turkey, and Great Britain & in the United States. If taken in a commercial term, marble refers to the composition of any rock with calcium carbonate including limestone that takes polish. If we extend the term further, it includes other stones too, such as alabaster, serpentine & other soft rocks. The thickness of marble in terms of gravity varies between 2.68 to 2.72. Marble is quite sensitive towards moist or acidic environment & disintegrated easily under such environment. Thus, it must be protected from such environment & rain as it is a durable product under a dry atmosphere. Statuary marble is the purest white form of marble with visible crystalline structure. The unique shine of these marble results from the reflection of light lying in the surface of inner crystals.

1.3 TYPES OF MARBLE FOUND WORLDWIDE

The major categories of marble comprises of ‘Beijing White’, ‘Boticena & Onyx’ (Green), ‘Carrara’, ‘Danby’, ‘Fauske’ ‘Katni’, ‘Llano Pink’, ‘Macael Nabresina’, ‘Parian’, ‘Red’, ‘Thassos’, ‘Vencac’, ‘White’ and ‘Yule’ that are available worldwide.

Since the ancient times, white marble have been a primary choice for the


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monuments for its softness, relative isotropy, homogeneity & a comparative confrontation to devastating. Besides, the waxy looks of a human body sculptures form due to the low index of calcite which allows light to penetrate some millimeters in to the stone before being scattered out.

CONSTRUCTION MARBLE –The word “crystalline calcite rock” is used in the construction & dimension stone trade for any crystalline calcitic rock. The Holston formation (as the name given by geologists) which form the “Tennessee marble”, which are thick grainy fossiliferous gray to pink to maroon Ordovician limestone are useful as building stone.

INDUSTRIAL USE –For the use of calcium carbonate in various products such as paper, toothpaste, plastics, & paints colorless & light-colored marble (aka ground marble) are used as it is a pure form of calcium carbonate. Around three-quarters of the calcium carbonate worldwide is made from ground marble.

ARTIFICIAL MARBLE-For the artificial marble, i.e. a paint which will resemble original marble, faux marble or faux marbling technique is used.

CULTURAL ASSOCIATIONS The Greek & Roman culture tell their association with marble through their monuments & sculptures which is known worldwide. Wide range of varieties & color choices availability for marble make it a first choice as decorative material. Marblehead, Ohio; Marble Arch, London; the Sea of Marmara; India's Marble Rocks; & the towns of Marble, Minnesota; Marble, Colorado; & Marble Hill, Manhattan, New York are some of the globally known places named after marble.


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[2]MARBLE PRODUCT PARAMETERS& MARKET

2.1PARAMETER FOR SELECTING MARBLE-Marble is selected on the basis of various parameter meant for its specific & end use. They are rated on three basic characteristics namely, color, pattern and grain size. COLOUR -Color has its importance in the market for marble which varies as per time, markets, and marble type from country to country, i.e. European markets prefer white marble while Middle East & far eastern markets demand for white, black & beige marble.

PATTERN -Pattern has its effect on the looks of marble, thus it plays a major role.

GRAIN SIZE -Fine, medium & large grain materials are the general form of grain size. Grain size is meant for the use of marble rather than its looks. Fine grain materials have a micro hardness & are meant for load bearing areas & sharp corners, whereas Medium & especially the large grain materials are unsuitable for those areas as there are chances of their breakage & cracks. Thus, the vary combinations of colors, sizes & patterns are meant for different segments of customers, i.e. customers with high price range look for rare color, fine grain & homogeneous pattern of marble or for medium grain, common colors & homogeneous pattern. & for the medium price range, the market has the marble with rare colors, large grain size & heterogeneous pattern.

2.2 PRODUCT CATEGORIES AFTER PROCESSING -

SLABS –Large semi processed sheets of marble with varied sizes & thickness of nearly 2 inches are called slabs. They are either exported to the international markets or processed further in the local industry. There are various uses of those slabs such as table or kitchen tops, wall facing, flooring & other related purposes. Price range of slabs depends on their quality & the size of the sheet.

UNPOLISHED TILES –The segment which opts for lower price of marble succumbs to unpolished tiles.


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Units which don’t have machineries to finish & section them sell them this way. Though, normally, they are sent for further processing.

POLISHED TILES- Well & fully processed tiles of marble are known as polished tiles. They are pretty expensive than the unpolished tiles & are sold with price variation based on their vein structure, shades & color.

DECORATIVE ITEMS- Various fancy items such as vase, sculptures, pillars etc are produced worldwide with the variation of their manufacturing techniques, i.e. in developing countries like India these are produced without the high tech machineries, whereas in the countries with high labor cost carving is done with CNC machines.

MARBLE CHIPS- Tiny pieces of crushed marble which are produced on completely different machinery meant for stone crushers of various grades. They vary in size which ranges from 1 inch to 0.5 cm as per the consumer choice. They are used in flooring & facing in the construction industry.

[3]WORLD MARBLE INDUSTRY

According to the site “tunisianindustry.net”, approximately 57% of the world's marble exports are contributed primarily by five countries; namely, Italy (20%), China (16%), India (10%), Spain (6%), and Portugal (5%).

While it comes to major importer countries of marble, the top marble importer countries series wise are: Germany, Japan & Taiwan for the import of nearly 4 million tons together. Whereas other countries such as USA, the Benelux countries, Hong Kong, France, Switzerland & Saudi Arabia import over one million tons.

3.1 EXPORT & IMPORT TRENDS

The primary receivers of Indian marble exports are USA, Italy, Taiwan, Japan, Germany & China.Since 1990s, the world’s marble industry has been showing a rapid growth & is estimated to grow at 8% per annum rate in the future. This


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In year 2000-2007. Indian marble exports amounted to aprrox Rs. 3000 million in the year 2007, showing a surge in demand for finished and non finished products.

Nearly 820 million sq. m. accounted for the total consumption of marble worldwide, which is estimated to reach up to 4.4 billion sq. m. by 2025. The situation by 2025 may increase the consumption of marble in the international market by 60%, leaving the domestic market with 40% .

3.2 INDIA

India o w n s a wide b a n d o f marble. Various Indian states have a wide reserve of marble. Rank wise, it has been Rajasthan, Gujarat, Madhya Pradesh, Haryana & Andhra Pradesh. Rajasthan reserves 90% of the total marble deposits in India.

Now, some other states like Bihar, Jammu & Kashmir, Maharashtra, Sikkim, and Uttar

Pradesh & Bengal are also coming up with newer areas

EXPORT-India holds its rank amongst the top marble exporting countries. As perthe data the website of “immcarrara”,

IMPORT-Italy, China, Egypt, Oman, Sri Lanka, Vietnam, Turkey & Iran were the countries from where India imported the most amount of marble during last year

[4]INDIAN MARBLE INDUSTRY

4.1 INDIAN STONE INDUSTRY-AN INSIGHT India has rich deposits of dimensional stones such as granite, marble, sandstone, limestone, slate, quartzite etc. found all over the country.States such as Rajasthan & Gujarat are primarily known for raw stone reserves & their production. India is the third largest exporter of marbleand marble products worldwide. Apart from that, it is also known as oneof the largest consumers of stones & stone products since it has a good distribution network within the country & a growing demand from the Indian middle class for their domestic use. (cdos-india.com)

4.2 A TRADITIONAL CULTURE India has a deep rooted history of stones & their uses since the ancient time, as old as 3200 B.C. Old sculptures, monuments, temples etc those which remain & those which managed to remain indicate that the Ancient Indian Civilization hold an architectural heritage. when comes toarchitectural work of marble in ancient India, Delwara temple with a very complex artistic work on marble & The Taj Mahal at Agra built in


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the 17th Century tell it all. Khajuraho Temple, Elephanta Caves, KonarkTemple, Ancient Buddhist monuments like the Sanchi Stupa of 3rd century BC etc are some of the ancient monuments which together represent the richness of Indian heritage. These monuments & thearchitectural work on them indicate the existence of well developed mining & processing industry. The modern India too carries that trend though with its modern buildings such as the Presidential House, Parliament House & Supreme Court which are made from high quality sandstone of Rajasthan. Lotus temple

of New Delhi tells about the journey of Indian architectural work, that is, from the ancient time till this modern era when it is compared with the Taj Mahal of Agra.

4.3: MARBLE INDUSTRY IN INDIA

India is rich in marble deposits. Rank wise, states like Rajasthan,Gujarat, Madhya Pradesh, and Andhra Pradesh are the top Indian states with huge deposits of marble. Rajasthan is the leader state in terms of marble reserve which is around 90% of total marble deposits in India. Bihar, Jammu & Kashmir, Maharashtra, Sikkim, & Uttar Pradesh & Bengal are some of the states which produce newer ranges of marble.


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4.4: MARBLE RESERVE IN INDIA in Aravali ranges & Raialo in Rajasthan, Champaner Series of Gujarat, Sakoli Series of Madhya Pradesh, Chilpi Series of Maharashtra, Vindyan, Cuddapah System in the Papaghani Series of Andhra Pradesh, Bijawar Series in Madhya Pradesh, Kaladgi Series in Karnataka & Delhi Group of rocks located in Alwar Series & Ajabgarh Series of Rajasthan.


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Other places with indifference are Jurassic & Cretaceous system.

Jaipur, Bharatpur, Kishangarh, Ajmer, Mewar, Udaipur & Sirohi areas of Rajasthan; Danta & Palanpur areas of Gujarat; Narnaul area of Haryana, Morena district of Madhya Pradesh & Guntur & Kurnool districts of Andhra Pradesh have the marble reserves of Ajabgarh series. Whereas, Bijapur & Gulburga districts of Karnataka have the deposits of Bhima series.

4.5 CLASSIFICATION OF INDIAN MARBLE (AS COMPARED TO INTERNATIONAL STANDARD) Though, worldwide, there is a vast variety of marble, yet India has its own kinds of marble reserves & their names. Some of them are Agaria,Bhainslana Black, Fancy Brown, Himalaya Grey, Makrana Kumari, Olive, Phalodi Pink, Jhiri Onyx, Katni White. They are found at various statescountrywide. Some of them might possess similar quality & type foundelsewhere in the world but might bear a local name.

4.6PRODUCTION TECHNOLOGY-The Indian stone industry manufactures huge ranges of stone products such as of blocks, flooring slabs, structural slabs, calibrated - ready to fix tiles, monuments, tomb stones, sculptures, artifacts, cobbles, cubes, kerbs, pebbles & landscape garden stones etc.

Since the introduction of modern machineries for working stone such as cutting, sawing, grinding & polishing & with the introduction of new quarry fields, there has been an increase in marble production.

4.7STONE HANDICRAFTS

Indian stone handicraft industry carries forward the ancient tradition of


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stone sculpture with slight modifications in their design. Indian artisansdo these all using simplest tools with proficiency, persistence & perseverance.

MARBLE PROCESSING-Currently, Indian made machineries as those which are made by wholly owned Indian companies & those with subsidiaries of foreign multinationals are used by the Indian quarry industry which include marble gang saws & tiling plants, circular saws for granite, polishing machines, & other quarrying equipments like pneumatic jack hammers, diesel operated compressors, hydraulic jacks, splitting equipment, winches, excavators, air pillows, etc.

4.8 RAJASTHANRajasthan comprises of rich ranges of marble such as Green, Makrana Albeta White, Makrana Kumari White, Makrana Dungri White, Jhiri Onyx, Phalodi Pink, Ambaji White, Indo-Italian, Babarmal Pink, Bhainslana Black, Forest Green, Forest Brown, Agaria White, & Morwar White found across Nagaur, Udaipur, Rajsamand, Banswara, Dungarpur, Jaipur, Sirohi, Bhilwara, Ajmer, Bundi, Alwar, Chittorgarh, Churu & Pali.

MARBLE BASED INDUSTRIES-

Makrana is considered as the hub of marble based industries in Rajasthan. Due to the saturation of the marble industry in Makrana,emerging entrepreneurs have established base in Udaipur, making it the second largest hub for marble industry in the state.

Furthermore, due to advanced infrastructural capabilities, Udaipur is well connected by rail, road and air.


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[5]ANALYSIS OF BUSINESS OPERATIONS

The business of marble in a country like India & in other developing or underdeveloped countries bears almost the same industry structure as highlighted in the previous chapter. This was observed when experts ofmarble industries were interviewed & on visiting a Pakistani site called “unido.org.pk” meant for marble industry. Following chapter is based on those observations.

5.1 BUSINESS STATUS As it was observed by the experts’ interview the business of marble is usually carried out by sole traders, yet in some cases enterprises do turn in to partnership firms.

The quarry owners can be classified into four categories as follows;

1). only produce blocks & sells. 2). block to traders for job work & then sell3) if his own unit of gang saw, then sell to direct customers. 4). or do above & sell to others too.

5.2 ACCOUNT MAINTAININGAccounting structures in this business are highly non-standardized and Indian entrepreneurs usually hire munshees (Indian accountants) or those with a bachelor’s degree or at least matriculate qualification.

5.3 HUMAN RESOURCE Typically, human resources in the Indian quarry business have entrepreneurs & labors. Managers & assistant managers & those otheremployees with different designations, as found in big & organized business, do not exist. The entire official works such as factoryoperations, administration, marketing & client handling and accounting are handled by entrepreneurs themselves. Only some well to doentrepreneurs with their flourishing business employ those white collar employees. Still, large units have helpers; crane operators etc. Usually two laborsare appointed on each single cutter machine which may go up to four or five for vertical/horizontal cutter & gang saw. The labor force is highlynon skilled with no formal training & thus gets on-job training. Labors


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working hours, in this industry are usually 8 hours per day at most of the marble mines along with some additional overtime pay scale. At the small & middle size marble mines, the required labors are about 30 to 40 & the wages nationally are Rs. 150/- per day.

5.4SLAB COST DISTRIBUTIONA marble block weighs from 10 to 15 tons & the product sale highly depends on the quality of marble. If material is dull in color the materialblock goes higher up to Rs. 1500 to Rs. 2000/- per ton, depending onnature of marble quality. Further pricing, with respect to their quality areas follows:

IF THE BLOCKS ARE COMMERCIAL:- 10 blocks about 120 tones @ Rs. 1500/-per ton = 180000/-

IF THE BLOCKS ARE MEDIUM:- 10 blocks about 120 ton @ Rs. 3000/- per ton = 360000/-

IF THE BLOCKS ARE GOOD & PURE WHITE:- 10 blocks about 120 tones @ Rs. 10000/- per ton = 1200000/-

The production cost remains constant for all the aforementioned qualities. So, marble can gain good profit if the nature is in favor ofquarry owner by giving good material & that thing depends on luck.

The production cost of marble usually goes per ton is Rs. 500 to Rs. 600. The above prices are meant for quarry owners when selling their products to a process house or traders. The prices are little higher whenselling the same to the direct customers, though, direct customers rarely go to mine owners & prefer to purchase from process house. It is no way good for any marble mine owner that marble’s production go lower. If it goes lower it is loss for that month & apart from thatmany a difficulties come such as overhead expenses by breakdown. In commercial grade material, entrepreneurs have to face a highly competitive market but if the material is good they possess a higher bargaining power with customers.

5.5 FINAL PRODUCTSThe market rate of marble is common for commercial quality. In market


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rate for this material the rate goes Rs. 5/- upper or lower as per the quality.Further variations in price can range from Rs. 10 to Rs. 20 for a sq. foot of marble. Currently, the commercial material in market are about Rs. 20/- to 25/- per sq. ftfor the ‘Thappi’ (slabs) but if the cut size is to be sold, the . rate goes down. Now a day there are no rates due to cracks of slabs. The slabs which are cracks, entrepreneur has to get them made in sizes. The sizes are always made perfectly as under:- 1) 9”*9” 2) 9”*12” 3) 12”*12” 4) 12”*185) 18”*186) 18”*24” 7) 24”*12 8) 24”*24” Mostly, these sizes are always demanded by the customers & their rates also go as per sizes but at lower rate than Thappi. Thappi means theslab which is sawed from block & it is fresh without crack as per sizes of block. The rest sells in the shape of slabs & handicrafts. Major finalproducts are tile (12 inch * 12 inch * 0.5 inch), counter tops, stairs, window & handicrafts like glasses, miniatures, paper weight etc.

5.6 WASTE MANAGEMENTAs it was observed from a Pakistani site “unido.org.pk” marble Processing gives two kinds of byproducts, stone scrap & slurry. Oninterviewing experts it was found that India too follows the same waste management system as it is followed by the Pakistani stone industry. Stone scrap results from the processing of completely unprocessed marble or of semi processed marble. In case of completely unprocessedmarble, the scrap is 30% of the marble being processed, whereas, in case of the processing of semi processed marble, it is lesser by 2-5%. The other byproduct of marble, slurry, which is actually the water containing marble powder where the amount of marble powder is 30% & that of water, is 70%. There is a constant use of this water till it is toothick to be soluble for marble powder.

5.7DISTRIBUTION CHANNELS OF MARBLE The marble is a basis of direct selling wit hout any middleman, so it ju st directly goes to factory from mine & then sold to customer as per his requirement.

5.8 ROYALTYThe royalty for marble block is usually fixed at the time of setting the rate of block with royalty or royalty tax. The royalty is paid by the runner in two ways:-


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There is a dead rent kept by the state govt. per hector. If royalty islesser than that amount, the entrepreneur has to pay dead rent per year. The royalty of marble block goes as per the state govt.’s rule. If the production goes less & royalty is lesser than the dead rent then the entrepreneur has to pay direct dead rent as mentioned above & if production goes high & the amount goes higher than dead rent, then he has to pay royalty. Whichever is high is to be paid.

5.9COMPETI TORS Marble stands as a competitor against marble in the first place itself. The competition might come as a result of cost price differentiat ion or traveling & distribut ion charges different iation or due to its availability or due to the differentiation in quality & type or may be even demand & requ irement of customers. Other substitutes of marbles are granites, limestone, kota stone, sandstone, slates, nat ural stone & other artificial stones such as artificial tiles, artificial marble, artificial granite etc. Apart from that, the said most costly marble is blue marble w hich can cost Rs. 2500 per square feet . The demand for artificial stonesmay go high from the customers’ side due to the varieties available in that as those stones can be molded according to t he manufacturer’s choice. But then again, there are about 10 0 variousfor granite if t hey are looking for color choices. Furthermore, in comparison to m arble, ceramic tiles are relatively less expensive. And if we compare marble tiles w it h the marbleslabs, the m arble tiles are much cheaper & it is because marble tiles are made out of cracked & rejected slabs or when there is very high dem and for it. The price for per square feet is Rs. 9 to Rs. 16 for tiles.The price for per square feet is Rs. 35 to Rs. 150 for slabs.And for whit e mat erial slabs it is Rs. 48 to Rs. 250.

5.10 MINING TECHNIQUES FOR MARBLE There are two types of mining techniques for marble, one is the underground & the other one is over the head of mountain, also known as “over head mining”. A good example of underground mining can beset by Makrana mines in Rajasthan where we have underground mining.

They work about 200 ft. to 300 ft. deepMining depends on nature as well as on luck of the owner because in production the block must be fresh, that is, without crack. In marble thecrack are too often & that also depends on the nature of marble’s qualityThe investment of most of the entrepreneurs of marble mine usually goes only for labors + diesel & break downs & after this they need per months equipment & that depends on their production. Developing countries like India & Pakistan still follow the traditional


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method of quarry, that is, blasting, which results in to high wastage of marble & small stone size reducing its price in the market. Lack of implementation of mining policy & cooperation among the cluster members work as further disadvantage for the quarry industry.

[6] GOVERNMENT INTERVENTION IN MINING Every business in any country needs the intervention of the government system of its country in terms of rules & regulations, guidelines, support etc, favoring the legal businesses in the country, making them run smoothly under any circumstance; thus strengthening the country’s economy, despite of any political system. While talking about the mining sector, rules & regulations do exist for mining meant not only for marble quarry but also for the mining of other natural resources.


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[7]SWOT ANALYSIS OF MARBLE INDUSTRY STRENGTH- WEAKNESS-1 Different processing machineries are produced by local manufacturers in this sector. .

2. Banking facilities accessibility. 3. Required laws for companies exist.

4. Unproblematic & simple . companies’ registration process.

5. Easy availability of cheap proper availability of electricity. 6. Workforce’s hereditary knowledge of marble industry. . 7. Availability of raw material for processing.

8. Availability of wide range of . marbles. 9. Competition within the industry ushering it ahead.

10. Meticulous entrepreneurs . keep running the industry despite lack of proper

1Lack of new trends in the industry due to lack of research

& development

2. Poor product quality due to lack of financial investment in the machineries.

3. Slow productivity due to obsolete machineries

4. Primeval mining methods cause high wastage, i.e. blasting 5. Slow production due to lack of labor workforce.

6. Extremely low literacy rate comes as a hindrance to

workforce in learning new skills7. Uncertainty among labors due to

daily wage system

8 Bureaucracy & corruption causehindrance in the business operation.

9. Insufficient knowledge of marketing & business planning

10. Qualities of Finished marble’s product not matching the international demand.


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infrastructure.

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OPPORTUNITY- THREATS-1.Increasing global demand marble & its availability in the country. 2. Availability of demanded marble of good quality & variety of colors. 3. Growth in the country level market demand due to the increasing demand by the domestic construction industry. 4. Fast improvement in physical & technological infrastructures. 5. Governmental working structures are being transformed to become easy & less complex. 6. Availability of the supporting institutions in the country. 7. Increasing investment opportunity in marble industry due to being a precedence sector of government. 8. Support to marble sector for development through donation. 9. Market segmentation can be done for rural & urban

1. High competition in the international market. 2. Increase influx of construction stone material from Pakistan, China & Afghanistan. 3. Short term benefits mentality leading to selling unprocessed marble & no planning for capitalization of resource. 4. Better salary packages by urban clusters attracting skilled workforce of under-developed clusters. 5. Poor support from Government department & mining disputes due to regulatory reforms. 6. Power supply capacity limitation & increasing power supply cost. 7. Unresolved disputes & politics. 8. Good & superior substitutes of marble, i.e. granite, tiles etc. 9. Today’s people’s urge on luxurious lifestyle which often make them choose Italian marble over the Indian one. 10. Marble is available in a generic form & no brand name or image is found for marble. marble & its availability in the country.


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[8] TYPES OF MARBLE

NAME LOCATION

Agaria Rajnagar rajasthan

Adanga Ambaji gujrat

Apollo Ambaji gujrat

Panther ambaji gujrat


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AndhiIndo jaipur rajasthan

Baroda Green Vadodra gujrat


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Bhainslana Black KOtputli Jaipur

Fancy brown Churu. Rajasthan

Bidasar Churu ,Rajasthan


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Jhiri onyx Alwar rajasthan

Katni white Katni MP

Albeta Makarana Rajasthan

Doongri Makarana Rajasthan

Olive Keshariya ji Udaipur

Phalodi Pink Jodhpur rajasthan


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Sea Green Keshariya ji Udaipur

Rampura Black Sikar rajasthan


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[9]OBSERVATIONSResponses of processors to the questionnaire Below is the outcome of responses given by 26 processors to the various questions asked in the questionnaire prepared for processors:-

Q: 1.What is your business cycle?

Responses of the first question answered by processors suggested that There is continuity in their business. They have a daily requirement of material & they process at least 60 tonnes of material daily. They have their contracts with quarry owners & traders, where quarry owners are the suppliers to them & traders are the buyers to them. They buy the rough marble blocks from the quarry owners. They process them in to marble slabs & deliver them to traders as per the orders booked with them.

Q: 2.Who all are your customers? Responses to the second question suggested that traders are the main customers for processors. They have their contract with them & thus as per the contract, traders do the bulk buying from them. Builders & final customers also buy the material from them but then they do not consider them as much as they consider traders.

Q: 3.What is your order cycle? Responses to the third question suggested that Processors’ order cycle role between getting the supply of materials from quarry & delivering the finished goods made from it to the contract traders as per their demand.

Q: 4.How the bid between you & your suppliers take place? Responses to the fourth question suggested that bidding is not required in the deal between processors & quarry owners since the perfect competition exists in the market & processors & quarry owners are aware of existing market rates.

Q: 5.What is your contribution to your suppliers in terms of business? Responses to the fifth question suggested thatNo contribution between processors & quarry owners take place. May be on personal level but that is just a tongue in a chick. Q: 6.How much cost does it incur in the job work of marble? Responses to the sixth question suggested that


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Job work on marble comes to around Rs. 650 to 780 Rs. on per ton of marble. Each ton gives 130 sq feet of material. So, that comes to Rs. 5 to Rs 6 on per sq. foot. That is the job work charges for marble.

Q: 7.What is your turnover? Responses to the seventh question suggested that processors have a yearly turnover of 3 to 10 crore Rs.

Q: 8.What is your revenue/margin? Responses to the eighth question suggested that The revenue margin of processors is around 10% to 12%.

Q: 9.Questions or comments if any?

1. Even local traders sometimes deal directly with quarry. 2. If the material of marble is cracked we make it in to cut size. (Responses to the ninth question were very limited. Hardly few processors shared their knowledge for the last question)

Questionnaire for processors


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First Name: ________ ________Last Name: ______ _________ Organization Name: __________________________________________ Phone Number: __________________________________________ Cell Number: __________________________________________ ___________________________________________________________ Q: 1.What is your business cycle? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 2.Who all are your customers? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 3.What is your order cycle? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 4.How the bid between you & your suppliers take place? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 5.What is your contribution to your suppliers in terms of business? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 6.How much cost does it incur in the job work of marble? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 7.What is your turnover? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 8.What is your revenue/margin? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ Q: 9.Questions or comments if any? ___________________________________________________________ ___________________________________________________________ ___________________________________________________________

QUESTIONNAIRE


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First Name: Manoj__________ Last Name: Lakhavat _______ Organization Name: Keshav Marbles ___________________________Phone Number: ____________________________ Cell Number: ______________________________

__________ Q: 1.What is your business cycle? We have our contracts with mine owners for the raw materials supply & with traders who do the bulk buying from us. We buy the raw material from those mine owners & sell the finished goods to our traders.

Q: 2.Who all are your customers? Traders.

Q: 3.What is your order cycle? We take orders in advance from traders. Sometimes they demand for the material from specific quarries. We buy the rough marble blocks from those quarries & sell them that marble after processing it.

Q: 4.How the bid between you & your suppliers take place? No bid.

Q: 5.What is your contribution to your suppliers in terms of business? No contribution.

Q: 6.How much cost does it incur in the job work of marble? Rs. 5 to Rs. 6 per sq. foot of marble.

Q: 7.What is your turnover? 9 crore Rs. P.A.

Q: 8.What is your revenue/margin? 11% to 12%. Q: 9.Questions or comments if any?

QUESTIONNAIRE#First Name: P.S.____________ Last Name: Bhait_________


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Organization Name: Shrenath Stone Craft (P) Ltd _________________Phone Number: 02974226225______________________________

____________________________________ Cell Number: 9414152248_______________________________ Q: 1.What is your business cycle? There is continuity in our business. We buy rough marble blocks from quarries as per the contract with quarry owners & after processing them we sell it to traders who are under our contract. Q: 2.Who all are your customers? For any processor, traders are their main customers. Q: 3.What is your order cycle? We always have orders from various traders with whom we have contract & who purchase the finished materials as per their requirements. We supply the material accordingly. Q: 4.How the bid between you & your suppliers take place? No bid. Q: 5.What is your contribution to your suppliers in terms of business? No contribution. Q: 6.How much cost does it incur in the job work of marble? There is a fixed market cost for the job work on marble. It is around Rs. 650 per ton. Each ton of marble gives total 130 sq. feet material. So, that comes to around Rs. 5 per sq. foot. Q: 7.What is your turnover? 6 crore Rs. P.A. Q: 8.What is your revenue/margin? 10% to 12%. Q: 9.Questions or comments if any?

QUESTIONNAIRE#3


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First Name: Raman__________ Last Name: Bansal__________ Organization Name: Elegant Marble & Granite Ind. Ltd_______________Phone Number: 02974226587______________________________

____________________________________ Cell Number: 9828126588________________________________ Q: 1.What is your business cycle? Quarry owners are our suppliers. We have our contract with them. We then sell it to our final customers, that is, traders. Q: 2.Who all are your customers? Traders & builders. Q: 3.What is your order cycle? For any processor, traders are his main customers. Quarry owners are also his customers but not for buying material but for the job work on marble but they are their suppliers. Q: 4.How the bid between you & your suppliers take place? No bid is required as the deal takes place as per the existing market price. Q: 5.What is your contribution to your suppliers in terms of business? No contribution to each other. Q: 6.How much cost does it incur in the job work of marble? It is usually around 650 Rs. per ton. That is the market rate all where. Q: 7.What is your turnover? 5 crore Rs. P.A. Q: 8.What is your revenue/margin? 10% to 12%. Q: 9.Questions or comments if any?


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QUESTIONNAIREFirst Name: Ashok __________ Last Name: Arya__________ Organization Name: Arya Marble & Granite P Ltd __________________ Phone Number: 02974226640 _____________________________

____________________________________ Cell Number: 9414202663_______________________________ Q: 1.What is your business cycle? We buy a fixed amount of material from the quarry owner with whom we have contract & provide the finished goods to our traders. Q: 2.Who all are your customers? Usually traders are our main customers but then domestic users & builders are also our customers. Q: 3.What is your order cycle? We have some fixed traders who purchase the product as per their order. Q: 4.How the bid between you & your suppliers take place? The market rates are so known to both of us, so, no bid requires. Q: 5.What is your contribution to your suppliers in terms of business? No contribution. It is just a simple deal. Q: 6.How much cost does it incur in the job work of marble? There’s a fixed market rate prevailing all where, that is Rs. 5 to Rs. 6 per sq. foot. Q: 7.What is your turnover? 3 to 4 crore Rs. P.A. Q: 8.What is your revenue/margin? 10%. Q: 9.Questions or comments if any?

QUESTIONNAIREFirst Name: Devendra ________Last Name: Agarwal ______


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Organization Name: Abhishek Granite Pvt. Ltd.__________________ Phone Number: 02974226504____________________________ Cell Number: 9829465858_____________________________ Q: 1.What is your business cycle? We have our contracts with mine owners. We purchase raw material from them & sell them to traders who book the order in advance. We daily have 4 to 5 trucks of finished goods of 15 tons each. Q: 2.Who all are your customers? Traders, domestic users & builders are our customers. Q: 3.What is your order cycle? We have fixed traders. They order us for some specific quality & size of marble & we deliver accordingly. Quarry names & quality are written on their ordered material. Process houses usually keep materials from various mines for variety in quality. Q: 4.How the bid between you & your suppliers take place? No bid. Q: 5.What is your contribution to your suppliers in terms of business? No contribution at all. Q: 6.How much cost does it incur in the job work of marble? For only job work it is 650 Rs. per ton (each ton gives 130 sq. feet) & thus process charge are 5 to 6 Rs. for per sq. foot, & if the material is thick, it may go higher. Q: 7.What is your turnover? 3 crore Rs. P.A. Q: 8.What is your revenue/margin? 10% Q: 9.Questions or comments if any?

QUESTIONARE


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First Name: Ajay _______ Last Name: Jain__________ Organization Name: Ajay Marble & Granite _____________________ Phone Number: ____________________________

____________________________________ Cell Number: ______________________________ Q: 1.What is your business cycle? We are the bulk buyer of marble blocks from quarries. We have our contract with traders who buy processed marble in bulk quantity. Q: 2.Who all are your customers? Traders, domestic users & builders. Q: 3.What is your order cycle? Traders keep contract with us & we sell them the material as per their order. Builders & final customers also buy the marble tiles from us. Q: 4.How the bid between you & your suppliers take place? No bid. Q: 5.What is your contribution to your suppliers in terms of business? Nothing. Q: 6.How much cost does it incur in the job work of marble? That is around Rs. 650 to Rs. 780 for per 130 sq. feet. That depends on the thickness of material. Existing market rate is Rs. 650 per 130 sq. feet. Q: 7.What is your turnover? 6 to 7 crore Rs. P.A. Q: 8.What is your revenue/margin? 11%. Q: 9.Questions or comments if any?


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FINDINGS: FINAL OUTCOMES OF THE QUESTIONNAIRES: The final & the main outcome that we get from all the three questionnaires above are:

Turnover P.A. of processors is from 3 to 10 crore Rs.

Turnover P.A. of quarry owners cum processors is from 5 to 7 crore Rs.

Margin that processors get is around 10% to 12%.

Margin that quarry owners cum processors get is around 15% to 20 %.

[10]CONCLUSION& SUGGESTIONMy final conclusion is that marble industrial sector can grow in the Indian market if the entrepreneurs investigate the ever pacing environment & adopt various strategies that can boost up their business. Even at its current stage where globalization, privatization & liberalization took place, more than fifteen years ago, the marble industry had been growing slow in comparison to the artificial stone industry.

In order to circumvent issues with respect to irregular supply, warehouses can be set-up with a vast space where raw material can be stored to meet any demand from the international market on time. Constant supply can be made certain from thesewarehouses in case of any dispute between owners of the mines & leaseholders.

Additionally, the potential of the marble business needs to be effectively communicated to the financial institutions so as to facilitate firms with credit upon the establishment of new technologies and other functional aspects of the business.

On job training of technical staff should be organized to improve their skills & effectively utilize the available technology.


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BIBLIOGRAPHY Reports Stone panorama

Articles Business & Economy Business Standard


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PARUL INSTITUTE OF MANAGEMENT VADODRA(Guj.)

PROJECT REPORT ON MARKETINGSTRATEGIES AND DISTRIBUTION CHANNELS

Submitted to- Submitted by-


Durgesh Project Report

Documents

Transcript of Durgesh Project Report