EXECUTIVE SUMMARY

The internship report is concentrated in the real estate sector of Bangladesh. I have tried to

analyze the industry as well as the company BORAK REAL  ESTATE (PVT) LTD.  I have

selected ten renowned real estate companies through some criteria. I have surveyed these

companies for our research purpose. The real estate business concept was developed in

Bangladesh in the sixties’ decades. Ispahani andEHL are the pioneers of this business. This

business was flourished in the first eighties’ decades. Now a days there are more than 126 real

estate companies are in this sector and this number is growing day by day because of the profit

margin of this sector. By showing plans and locations they sell apartments. For this reason this

product is called “unseen” product. Companies have to borrow a negligible amount of taka from

the banks. The growth rate of industry is about 15%. Profit margin is about 15% – 25% on an

average. It attracts the new business firms to this sector. The industry is in the transition to

maturity stage of its life cycle. Again some companies’ growth rates are higher than others. This

rising sector may be collapsed for some dishonest entrepreneurs. In this research report I have

discussed the overall situations on management style, land procurement, design and

engineering, marketing, legal and logistics of the industry and the company BRE (PVT) LTD. with

SWOT analysis. Since entry and exit are free in this sector so day by day market is being

competitive. Bargaining powers of the clients are increased in this competitive market. In this

situation some companies are kicked out of the market for their poor management. These weak

companies’ market shares are acquired by leading companies.

BRE (PVT) LTD. is one of the leading companies in the industry though it was established in 11

may 1987. They own 10% shares of the segmented market areas partially one and two. The

current growth rate of the company is about 40%.The experienced top management is conscious

about the changing market behavior. They are flexible in their management style that is they are

situational. The top demand. They recruit young personnel’s for their mid –level management to

get maximum benefit from those fresh persons. The strong marketing, land procurement and

design department help the organization to achieve its objective. But the logistics department is

not structured which incurred high production cost. They do not identify the logistics activities

clearly for getting better benefit by using the modern approach of logistics. To hold the market

leadership they have to improve this department. The company has 50 projects within which 5

projects are completed and 21 projects are under construction. Most of the apartments are at

Gulshan. Few of Baridhara, Dhanmondi and Banani. In Gulshan they have established

themselves quite well and have general confidence about the market. All decisions are taken by

the Chairman and Managing Director of the company. Now they are trying to delegate the

authority to the mid-level management to take prompt decision for the company. BRE (PVT) LTD.

is committed to excellence and believes that achievements exist forever.

INTRODUCTION

MEANING OF REAL ESTATE

In our day-to-day life, real estate is being used in various manner; we make use of real estate

resources to provide shelter, comfort, convenience, and privacy, a place of work, recreational

facilities and related service. In an estimate real estate represents more than 40% of national

wealth. Therefore, the manner welfare of our people the success or failure of business firms and

the general prosperity of the country.

The name given to the commodity reality which includes not only land but also all human

improvements placed on the land. The name given to the business engaged in by those people

who conduct commercial transactions in real estate.

The main component of real estate as a commodity is land. It states not only the surface of the

earth but also the property rights and interests that attach to owner ship of reality, including

subsurface minerals. Thus the real estate means acquisition of land and building which is called

inherent right. The people who are the owner, user, maker, financier or marketer of the property

have some rights to the property.

BACKGROUND

Multistory living is a relatively new phenomenon in Bangladesh in late 70s apartment project was

started in Dhaka city in early 80s the business started flourishing. Until recently multistoried are

built for office and commercial purpose only. But today there is a boom in building high rise

buildings as living quarters, known as apartment or condominiums. This process started after the

developers had taken up the business of constructing high rise buildings and selling the

apartments. Is it a welcome phenomenon or an approach to the forward upon?

There are ample reasons why people have taken to liking multistory living. Extreme sortie of open

space in the important area of Dhaka city, hazards of purchasing land and construction building

and increasing in population have encouraged people to like multistory living. The populate is

increasing leaps and bounds and land is scarce. Sprawling growth with single unit housesin

subdivisions is not very feasible because service like access of roads, electricity, water, gas, etc.

do not reach peripheral regions very easily. All the concentrations have to take place in the

central part of the city. Peripheral land is usually bought by speculators. Some services gradually

creep into peripheral regions for their demands. The process has usually taken about a decade.

Travel from periphery to the central part of the city has become so difficult because of traffic

chaos & jam, which takes hours. So important person of business wants to live as close to the

center as possible. A renowned economist once mentioned that in Dhaka with

sufficient money most of the services need of an individual can be met. Faulty water supply can

be overcome by sucking water from the supply line by a pump or sinking a tube-well if necessary.

In case, school is not available for one is child’s one can start one good. For medical services

one can take a trip abroad for consultation or treatment. All these can be done with sufficient

money but one cannot avoid the traffic jam & fly to the office every day. Accessibility is the most

serious problem that cannot be solved individually. Hence proximity to the place of work is a

priority. Increase in land value encourages raising buildings. The higher the value of land the

higher the buildings tend to rise.

In Dhaka land value is increasing day by day. The fact is that if the cost of one square foot of land

is more than one square foot of built area, developers will go for high rise buildings. Cost of

construction per square feet at present is among 700 to 1200 taka. Whenever the cost of land per

katha that is 721 sft is more than taka five lacs, there is sufficient incentive for building high rise.

Apartments building and selling being a relative very new type of business, e.g. real estate

business. It has started in the last seventies. Little is known about its different aspects as yet. But

from observation evident investment in this type of business is quite big. As well as the prices of

apartments are also high. The buyers of apartments are well off and have acquired the

temperament of community living. They want to buy apartments for security and consider it a

symbol of status.

All these issues create genuine interest to get ideas about this type of real estate business sector

and with that end in view the present study report was undertaken. This study aims at

understanding the overall aspects, specially marketing & logistics aspects of the industry as well

as the company BRE (PVT) LTD.

Total House holds position in Dhaka (SMA)

Year No. of Applications

Received by RAJUK No. of plans passed by RAJUK

1991 3701 2913

1992 3897 2809

1993 5532 3872

1994 8202 5905

1995 6995 4966

1996 8112 6012

Source: Primary data from RAJUK.

OBJECTIVES OF STUDY

The main purpose of the study is to evaluate and understand the present overall situation and

also to measure the future prospect of this sector as well as the company BRE (PVT) LTD.

• To know about marketing aspect of the industry.

• To know about marketing aspect of the company.

• To analyze the logistics activities of the company.

• To analyze the SWOT of the company.

• To know about the legal side of this industry and the company.

• Recommendations for overcoming those problems that are found in our

JUSTIFICATION

The report is mainly based on the marketing aspect of the real estate sector and special

concentration on the company BORAK REAL ESTATE (PVT) LTD. So I have chosen the title

“Marketing Aspects of the Real Estate Business and Prospects of BORAK REAL ESTATE (PVT)

LTD.” In this report I have also described logistics support and legal side of this business but not

in depth. For this I have avoided to mention it in the title name.

METHODOLOGY

For my study purpose I collected information from both primary and secondary sources.

Primary sources:

For collecting the primary data firstly, I personally discussed with different officials of different

developers on the basis of the Questionnaire (Annexure 1).

Secondly, data were collected from executives, managers etc.of BRE (PVT) LTD.

Thirdly, a participative discussion was conducted with Mr. Anower Shamim, MD. of BRE (PVT)

LTD. from which I have collected information about the company and the industry.

Secondary sources:

• Reports

• Articles

• Bulletin etc

• REHAB

By surveying the developers I came to know about this sector. Their position in the industry their

target groups, existing problems and prospect of this sector. I also surveyed some ongoing

projects of the developers to know about the construction side. I have visited REHAB ( Real

Estate Housing Association of Bangladesh ) to know about the current situation of this sector.

The Research Approach The study approach is to collect the qualitative data and the following

three approaches were used:

1. Discussion

2. Personal Interview and

3. The observation method

While collecting the primary data the instant response were found and it was possible to observe

the real situation.

Research Instrument Questionnaires are used to collect the primary data from the developers.

Sampling Plan In order to retrieve the necessary information as precisely as possible from the

survey, the following sampling plan was pursued:

1. Sample unit: The sample unit the marketing strategies of borak real estate (pvt) ltd.

2. Contact method: The information was collected by the way of face to face interviews and

discussions with each developer.

SCOPE OF THE STUDY

The total industry of the real estate is the scope of the study. There are more than 126

developers in the city. Few of them are working in other divisions specially in Chittagong, i.e. The

study is concentrated in the Dhaka city only due to the time limitation. But I did not able to

consider all the developers in the Dhaka, I only considered those developers who are working in

the Dhaka city as well as creating luxury apartments in this city. Moreover in the internship

program I have to do a lot of works for my study purpose.

LIMITATIONS

During the internship program I have faced a lot of problems to complete the study. In the short

time it is not possible for me to know everything about the total sector. Even then I have tried to

know the important side of this sector as well as marketing and logistics that are taken here for

the study purpose.

Problems I have faced for the study purpose:

• I did not get up to date information about the sector.

• Maximum developers did not provide me all information that is needed for my study purpose.

• Wrong information is provided by the developers.

• I have to go several times to the developers for getting information which consumes my

valuable times.

• Due to the non- cooperation of the management of Shamota Real Estate and Shine Pukur

Holding Ltd. I did not get the information about these developers.

STRUCTURE

In the following I have tried to analyze the total industry, specifically on marketing, legal and

logistics aspects. And first in brief analysis of management, land procurement and design &

engineering aspect of the industry. Then I discussed about the company BRE (PVT) LTD. Here I

analyze in brief management, land procurement and design aspect. And in depth analysis of

marketing, legal and logistics aspect of

thecompany.Thisreportsendswithasummaryoffindingsandrecommendationse management of

BRE (PVT) LTD. for successful operation of their business.

CHAPTER TWO

FINDINGS AND OBSERVATIONS

MARKET SEGMENTATION

Marketing department observe and analyze the different factors and or the basis of this

information the market is segmented. The market analyzed on the basis of external threats and

opportunities as well as the internal strengths and weakness and depending upon this the market

is segmented. The market segmentation is categorized by;

a) Apartment Business

b) Commercial Building

Apartment Business

In apartment sector there is no specific target marketers. Those who are able to buy the

apartment are the target marketers. On the other hand, the target marketers of any project

depend on the location of the site. For example: Gulshan project must have the target marketers

of high income people. If the projects location is Elephant Road, which is not so much important

place, then the target marketers can be any body.

Commercial Building

Like apartment sector, also in commercial sector the site or location of the project is an important

factor. Generally, commercial buildings are building in the commercial areas, such as, Motijheel,

Tejgaon etc. So that the project can be sold quickly. The target marketers for commercial sector

are generally the higher income groups & famous companies such as Uttara Motors, Nitol Motors

etc.

TARGET MARKET

The target clients can be segmented into broad categories:

A) Individual Prospective Apartment Buyer

B) Apartment Developer

A) Individual Prospective Apartment Buyer

Theoretically, anyone who is in the market of acquisition of an apartment is a potential client. VBL

would target to provide finance to that particular segment or group who are reluctant to go to

public sector financing, or want to reduce their income tax burden or those who want to invest

their own resources for other profitable purpose. The clients are likely to be Businessmen,

Bangladeshi wage earners working abroad, High officials of

Government and autonomous bodies as well as Executives / Officers working on different

international / multinational corporations.

B) Apartment Developer

Targeting growing, developers who have proper record of accomplishment are the other group of

potential initial clients. Financing these developers will have the added ad of cutting u. it the term

of lending.

MARKETING MIX DEVELOPMENT

PRODUCT STRATEGY

Currently Borak Real Estate (Pvt) Ltd. offering variety of features and facilities for apartment

holders such as affordable accommodation in desired locations, health club, roof top garden, and

arrangement for children playing, European lift, stand by generator, prayer room, loan facility

available , 24 hours security system and after sales service.

PRICE STRATEGY

Borak Real Estate (Pvt) Ltd. sale flat. After finish designing from a repotted architecture, they

select price strategy. This price strategy based on some decision. Such as – cost of land develop,

cost of raw material , payment of land owner etc. after this they set up a price. This price strategy

is two types. One is at a time and another is by installment. If client want at a time payment, he

get 10% discount from fixed price. On the other hand, if any one want by installment, he has to

paid 30% with in 30 days. And he paid rest amount with 18 installment. Most of the Real Estate

company flexi their installment process.

PLACE STRATEGY

The company Borak Real Estate (Pvt) Ltd. is conscious about their placing strategy. Borak Real

Estate (Pvt) Ltd. targets a significance customer. BRE (PVT) LTD. also target middle upper class

client. So these types of people want middle flat size in residential area. So think matter the

company select price strategy. Most of the project of this company’s is Gulshan, also

mohammadpur, Uttara, Kalabagan, Kathalbagan, Pallabi and Dhanmondi.

PROMOTION STRATEGY

The company Borak Real Estate (Pvt) Ltd. is very conscious how to promote their product. For

the promotion of company’s product they use some media.

News media : They give at least 10 days advertise out of 30 days in news paper for sale their

apartment in various location with different offer. Mainly they use the Ittefaq, The Prothom Alo,

The Jugantor news paper etc. as media.

Hand note: To promote their product they use hand note process. They give hand note a number

of targeted client for publicity their product and its location.

Festoon: To promote Borak Real Estate (Pvt) Ltd. use festoon as media of promotion strategy.

Company gives an excellent offer which is mention there and in hang on main road side.

Bill board: Borak Real Estate (Pvt) Ltd. also use bill boards for company advertise. Bill boards are

situated in main point in Dhaka city. Like front side of hotel Sheraton.

Web site: Details information of BRE’S web site. A large number of Probashi came to know about

BRE’S project and also company and finally they purchase their flat.

SALES ANALYSIS

After end of the year 2007 Borak Real Estate (PVT) Ltd. analysis their sales. The company is

successful to reach their visions. At the beginning of the year they make a plan for increasing

their sales. They are able to purchase 90 flat in 2007. Marketing department follows different

strategies and policies to convince the customer.

As a result marketing department is successful to increase their sales. Flat Sales in 2007 are

given flowchart:

Name of the month Quantity

January 7

February 5

March 9

April 12

May 14

June 14

July 18

August 20

September 16

October 17

November 12

December 13

MARKET SHARE ANALYSIS

When Borak Real Estate (Pvt) Ltd. started construction their project was only three. In that year

they sale only seven flats. In 2007 their project is 33 and they sold 95 flats in this year.

REHAB fair – 2007 which is held 19 th – 23 th February 2008 the company sale 15 flats. REHAB

fair 2005, 120 companies total sold 870 flats and Borak Real Estate (Pvt) Ltd. sold 13 flats which

is 1.27%.

In 2007 their total flat sale is 95 and all companies sold 19,975. Here their market share is 0.48%.

There are three categories Real Estate company in Bangladesh. First class company sales 3900

total in a year and second class company total sales 9100 in a year and Third class company

total sales 6975 in a year.

In 2007 Advance Development Technology sales flat 133, BDDL sales approx. 139, Navana Real

Estate ltd. sales approx. 135, Amin Mohammad sales approx. 141 and Borak Real Estate (Pvt)

Ltd. Sales 115.

PROFIT ANALYSIS

In the era of globalization, changing mindsets have recognized real estate as an important tool

for economic growth and investment. The importance of the real estate recognized as a

significant growth instrument. The greater volume of investment and development of real estate

will drive economic development and stimulate capital formation in an increasingly competitive

environment.

Planning for fund collections: Since it’s a real estate business, we need a huge amount of money

to invest in the Company, as we look for the long- term investment and maximize the wealth of

the company. In addition, administration and finance sector combined decided that we have a

need for Tk. 20 core or above. Only Tk. 1 core have available in our hand, assume that it will

provide by the private investment from companies shareholders. Therefore, the rest of the

investment would come from the external source and administration of the company give ensures

that they are able to create the fund from the following sources:

1. Long-term Sources

Customers’ Investment: 30% of the project. Marketing sector give us ensure that they are able to

attract the attention of the buyer of the project and can sell all the apartment with the 30% of the

customer’s investment.

Project ‘A’ will bear the cost approx. Tk. 8 core and will sell for Tk. 9 core. So, 30% of Tk. 9 core

is Tk. 2 core 70 lac which is 33.75% of the total cost.

Bank Loan: Tk. 3 core with a interest rate of 10% for the 10 years, which is 37.5% of the total

cost.

2. Intermediate–term Sources

Lease Financing Tk. 50 lacs for 5 years with a interest rate of 7% of the total investment. This will

be to buy the companies equipment.

3. Short-term Sources

Short-term loan Tk. 80 lacs that is 10% of the total cost of project ‘A’. This amount will collect

from the people of the company as a private loan with an interest rate of 6% according to the

company Act of Bangladesh, 1994.

Retain Earnings

Retain earnings is the portion of companies profit which is not allocated to the shareholders of

the company. These earnings will be termed as one of the sources of fund. As the company

starts from new, retained earnings is not available since now. However, after the project ‘A’, we

hope that some retain earnings will earn. This amount will investor further investment in the

company. However, this is depends on the dividend policy of the company.

It is noted that we estimate only for the project ‘A’. However, after a period we add with the

project ‘B’ and then we need the amount of Tk. 10 core. We will collect the fund according to the

way of project ‘A’. Rest of the Tk. 10 core will acquire from the earnings of project ‘A’.

As the company starts from now, dividend will be paid after 2nd year, when project ‘A’ and project

‘B’ will finished. Payment policy such that we can reinvest the majority part of retains earnings.

PRODUCT

Belch and Belch define product as – Anything that can be offered to a marketer for attention,

acquisition, use on consumption and that might satisfy a want and need. Products include more

than just tangible goods. Broadly defined, product includes physical objectives, service, events,

person, places organization, ideas or mixes of these entities. Thus throughout this test we use

the term product broadly to include any or all of these entities.

There are some kinds of product. These are as follows:

• Consumer product

• Convenience product

• Shopping product

• Specially product

• Unsought product

• Industrial product

• Materials and parts

• Capital items

Borak Real Estate (Pvt) Ltd. sold residential apartment. Apartment is their product. Now-a-days

21 projects are under construction. They already hand over 4 projects. Before they made

apartment, first they bought land from landowner by cash or ratio or both together. Before finish

apartment, they have already purchase their product. Client purchase flat with at a time payment

or by installment.

PRODUCT MARKET ANALYSIS

The segmented market areas are described below:

Segment 1: Baridhara, Gulshan, Banani, DOHS, Uttara.

Segment 2: Dhanmondi.

Segment 3: Segunbagicha, Shantinagar, Kakrail, Malibagh, Shahabagh,

Kalabagan etc.

Segment 4: Mirpur.

Segment 5: Old Town of Dhaka city.

Segment 6: (For office building only) Motijheel, Dilkusha, Fakirerpul, DIT extension Road, R.K

Mission Road, Kawran Bazar, etc.

SERVICE PROCESS

TO WHOM ALL THESE PRESENTS SHALL COME, I MR. RAFIQUL ISLAM S/O. Late Kamal

Uddin, House – 74, Road 11/A, Dhanmondi, Dhaka addressed to as the “Land Owner” First Party

which expression where the context so admits shall include his heirs, successors, administrators,

executors, legal representatives and assigns of the First Party, hereby known as the

“Executants”.

Borak Real Estate (Pvt) Ltd. at 51/B, Kemal Ataturk Avenue, Banani. P.S.- Gulshan, Dhaka

owned by Managing Director, MR. ANWAR SHAMIM S/O late Shamsul Haque, District-Dhaka, by

faith Muslim, by Profession- Business and Bangladeshi by National hereinafter referred to as the

“Developer” which expression where the context so admits shall include their successor,

administrators, executors, legal representatives and assigns of the Second Party to construct two

separate 6- storied Apartment Buildings, one on 10 (ten) Kathas land in the Eastern Part and

another on 5 (five) Katha land on the Western Part of the Schedule- A Land at plot No.21, Road

No. 4, Dhaka Cantonment, Dhaka measuring a total land area of approximately 15 (fifteen)

kathas.

WHEREAS I am desirous of appointing the Developer Second Party as my ATTORNEY for

carrying into effect the aforesaid purpose.

NOW, KNOW YE AND THESE PRESENTS WITNESS that I do hereby dominate, constitute and

appoint the Developer Borak Real Estate (Pvt) Ltd. at at 51/B, Kemal Ataturk Avenue, Banani.

P.S. – Gulshan, Dhaka owned by Managing Director, MR. ANWAR SHAMIM S/O late Shamsul

Haque, the Second Party irrevocably to be my true & lawful attorney to do execute, perform all or

any of the acts, deeds, matters, things in my name and on my behalf and authorities hereinafter

mentioned.

1. To manage, superintend, conduct, protect, and maintain the scheduled land and to do all acts,

deeds and things with regard to the scheduled land as the Developer shall think fit and expedient.

2. To construct two separate separate 6- storied Apartment Buildings, one on 10 (ten) Kathas

land in the Eastern Part and another on 5 (five) Kathas land on the Western Part of the Schedule-

A Land, obtain sanction of the plan from Rajdhani Unnayan Katripakkha (RAJUK) after the

preparation of Architectural & Structural design, take WASA connection, Water connection,

Electrical connection and Gas connection in the scheduled land and proposed buildings thereon.

3. To invest money for the construction of the aforesaid two separate 6- storied Apartment

Buildings on the scheduled land.

4. To negotiate and enter into Agreement with the prospective buyers of the Apartment / floor

space / cubicles of the building to be constructed on the scheduled land.

5. To take all steps for obtaining income tax clearance certificates for registration of sale deed /

deeds of conveyance relating to the sale of the said properly at the Second Party’s own account.

6. To sell, exchange, allot and dispose the Floor space / Cubicles / Apartments to be constructed

on the scheduled land including undivided and undemocratic share or proportion of the

scheduled land to the buyers at a price to be determined by the Developer and receive money

from the buyers and give receipts of the same and to execute the above mentioned documents.

However the Second Party will have the right to transfer the Apartments transfer can not be

effected prior to full completion of the entire project and handing over of building B’I to him Land

Owner First Party.

7. To affirm and swear the affidavits as required by the Bangladesh Transfer of Immovable

Property (Temporary Provisions) order, 1972 or any other law of for any other purpose in respect

of the said property.

8. To appear before the Registrar or Sub- Registrar and present for registration of the sale deed,

exchange deed, power of Attorney or any other deed or document in respect of the said property

executed by the Attorney in favor of the Lenders, Buyers or any other persons.

9. To appear, represent and act in all civil or criminal court or Arbitration and the judicial and

revenue authorities either in the original or appellate side as well as in the Government

departments, local authority, autonomous authority or other body corporate, and to prosecute or

to take part in all or any action, application, suit, appeal, proceedings and for such purposes to

subscribe, sign and verify all plaint, written statement and the memorandum of Appeal and to do

all acts, deeds and things which may be necessary in relation thereto and to executive Powers /

Vokalatnamas.

10. To appoint and retain lawyers, Advocates, Legal Advisers, Tax Advisers and to revoke such

appointments from time to time and again to re-appoint as occasion, shall require for the

aforesaid purpose.

11. To pay rents, revenues, taxes, rates, fees, and all other assessments and legal dues and

changes payable by us for the said property to the Government or to any other public body and

authority and obtain receipts and discharge there for after the date of signing this power of

Attorney.

12. To incur any expenditure that may be necessary for the management protection and

maintenance of the said property.

13. To accept on our behalf services of all notices, summons or any other rights issued by any

court of Law, Government Department or Office, City Corporation, WASA, Dhaka Electric Supply

Authority (DESA), Cantonment Board, Dhaka or any other authorities or local bodies or any

company in respect of the said property and to do the needful in connection therewith.

14.To file on our behalf taxation returns, take part in all taxation proceedings and make

application for refunds, sign all instruments, forms, documents, letters and other papers relating

all taxation proceedings appear personally or through lawyers and advocates or other duly

constituted agents before any officers, court or tribunal in relation to any taxation matters or

proceedings by or against us including proceeding or the first instances and on reference and or

appeals, act and settle assessments and pay all taxes assessed on and payable by us, receive

refunds and give valid receipts therefore and generally to act in all matters connected with

income-tax, wealth-tax and other taxes whether on capital or revenue in which we may be

interested or concerned and to take ail steps as the Developer Second Party shall consider

necessary expedient or advantageous in relation to the said property.

15. My Attorney the Development Second Party may exercise all or any of these powers as and

in the manner the Developer think fit.

16. And generally to act as my Attorney or Agent for the purpose stated herein and to do all

instruments, acts, matters and things as fully and effectually as I could do if I was personally

present.

17. And I do hereby agree to rectify and confirm all and whatsoever my Attorney the Developer

shall lawfully do or cause to be done in or about my Scheduled Land by virtue of these presents

and all acts, deeds and things lawfully done by my Attorney shall construed as acts, deeds and

things done by me and that this power of Attorney shall be irrevocable.

SCHEDULE OF LAND

All that piece and parcel of land fully measuring more or less 15 (fifteen) kathas situated at plot

No. 21 (Old), 2 (New), Road- 4, under survey Map-40P of Dhaka Cantonment, P.S. Dhaka

Cantonment (formerly Tejgaon), Dhaka-1206 butted and bounded by- On the East- Road on the

West Plot No. 22, on the North Road, On the South – Plot No.18.

PRICE

In the narrowest sense price is the amount of money change for a product or service. More

broadly, price is the sum of all the benefits of having using the product or service. Historically

price has been the major factor affecting buyer’s choice.Panera’s CEO says the challenge is to

harvest the customer value the company creates.

Dynamic pricing – charging different prices developing an individual customer and situation.

Borak Real Estate (Pvt) Ltd. sale flat. After finish designing from a repotted architecture, they

select price strategy. This price strategy based on some decision. Such as – cost of land develop,

cost of raw material, payment of land owner etc. after this they set up a price. This price strategy

is two types. One is at a time and another is by installment. If client want at a time payment, he

get 10% discount from fixed price. On the other hand, if any one want by installment, he has to

paid 30% with in 30 days. Some analyze the demand of the apartments for fixing up the price. In

the real estate sector markup pricing is used for selling apartments. In this way the developers

add a markup such as 20% – 30% on their construction cost and then they offer it to the clients.

In the study some companies are found to take demand into account in fixing price. A little

percentage of the industry’s pricing policy and some of the companies follow a pricing method

according to convenience.It has been observed that prices of apartments of similar locality vary

due to the quality of construction. In the same way similar size apartments vary due to the

locations. The following table shows the current price of apartments of various sizes located in

different locations.

Locations Price per sft

(In taka) Locations Price per sft

(In taka)

Gulshan

1800-2000 Shegun Bagicha 1600-1750

Baridhara 2000-2200 Shantinagar 1550-1600

Dhanmondi 1650-1860 New Baily Road 1520-1550

Malibag 1270-1400 Eskaton 1575-1650

Price per sft of apartments in several locations.

PROMOTION

The study reveals that the apartment building companies undertook promotional efforts as a part

of their marketing programs.

Promotion is defined as the co-ordination of all seller initiated efforts to set up channels of

information and persuasion in order to sell goods and service or promote an idea. While implicate

communication occurs through the various elements of the marketing mix, most of an

organization’s communications with the market place take place as part of a carefully planned

controlled promotional program. The basic tools used to accomplish an organization’s

communication objective are often referred to as the promotional.

The promotion blend:

Sales people

• Number

• Selection

• Training

• Incentives

Advertising

• Targets

• Media types

• Types of ads

• Copy thrust

Sales promotion

Publicity

It has been observed that 100% of the companies use advertising and 40% of the companies use

personal seeling for promoting their business. The companies were found to use different media

for their promotional activities. BRE (PVT) LTD. use news paper media.Generally the company

use as news paper media Prothom Alo, Jugantor, Daily Ittefaq, and The Daily Star. The company

also use TV media, magazines.Arthokotha and Thikana this two organizations publish

magazines. The company publishes brochures for every projects.Some times the company

provided nice promotional package for the customers by offering excellent rate, quick services,

gift hamper. BRE (PVT) LTD. also set a huge experience sale people who are always care for

their customers and try to increase the sales. In this industry we see that promotional and

entertainment budget of the companies are quite high.

Table 1 percentage of media coverage of the industry

MEDIA PERCENTAGE OF COMPANIES

News paper

Television

Magazine

Hoarding

100

20

85

15

TOTAL 220*

*Total percentage exceeds 100 as companies were found to use more than one media.

PLACE

Place (or placement) are those associated with channels of distribution that serve as the means

for getting the products to the target customers. The distribution system performs transactional,

logistical and facilitating function.

Distributions decision includes:

• Distribution channels

• Specific channel member

• Inventory management

• Ware housing

• Distribution centers

• Order processing

• Transportation

• Reverse logistics

Borak Real Estate (Pvt) Ltd. is conscious about their placing strategy. The company targets a

significance customer, and also target middle upper class client. So these types of people want

middle flat size in residential area. So think matter we select place strategy. Most of the project

place is Gulshan of this company. But at this time, they also select Mohammadpur, Uttara,

Kalabagan, Kathalbagan, Pallabi and Dhanmondi as their project place.

MARKET SEGMENTATION

Marketing department observe and analyze the different factors and or the basis of this

information the market is segmented. The market analyzed on the basis of external threats and

opportunities as well as the internal strengths and weakness and depending upon this the market

is segmented. The market segmentation is categorized by;

a) Apartment Business

b) Commercial Building

Apartment Business

In apartment sector there is no specific target marketers. Those who are able to buy the

apartment are the target marketers. On the other hand, the target marketers of any project

depend on the location of the site. For example: Gulshan project must have the target marketers

of high income people. If the projects location is Elephant Road, which is not so much important

place, then the target marketers can be any body.

Commercial Building

Like apartment sector, also in commercial sector the site or location of the project is an important

factor. Generally, commercial buildings are building in the commercial areas, such as, Motijheel,

Tejgaon etc. So that the project can be sold quickly. The target marketers for commercial sector

are generally the higher income groups & famous companies such as Uttara Motors, Nitol Motors

etc.

TARGET MARKET

The target clients can be segmented into broad categories:

A) Individual Prospective Apartment Buyer

B) Apartment Developer

A) Individual Prospective Apartment Buyer

Theoretically, anyone who is in the market of acquisition of an apartment is a potential client. VBL

would target to provide finance to that particular segment or group who are reluctant to go to

public sector financing, or want to reduce their income tax burden or those who want to invest

their own resources for other profitable purpose. The clients are likely to be Businessmen,

Bangladeshi wage earners working abroad, High officials of

Government and autonomous bodies as well as Executives / Officers working on different

international / multinational corporations.

B) Apartment Developer

Targeting growing, developers who have proper record of accomplishment are the other group of

potential initial clients. Financing these developers will have the added ad of cutting u. it the term

of lending.

MARKETING MIX DEVELOPMENT

PRODUCT STRATEGY

Currently Borak Real Estate (Pvt) Ltd. offering variety of features and facilities for apartment

holders such as affordable accommodation in desired locations, health club, roof top garden, and

arrangement for children playing, European lift, stand by generator, prayer room, loan facility

available , 24 hours security system and after sales service.

PRICE STRATEGY

Borak Real Estate (Pvt) Ltd. sale flat. After finish designing from a repotted architecture, they

select price strategy. This price strategy based on some decision. Such as – cost of land develop,

cost of raw material , payment of land owner etc. after this they set up a price. This price strategy

is two types. One is at a time and another is by installment. If client want at a time payment, he

get 10% discount from fixed price. On the other hand, if any one want by installment, he has to

paid 30% with in 30 days. And he paid rest amount with 18 installment. Most of the Real Estate

company flexi their installment process.

PLACE STRATEGY

The company Borak Real Estate (Pvt) Ltd. is conscious about their placing strategy. Borak Real

Estate (Pvt) Ltd. targets a significance customer. BRE (PVT) LTD. also target middle upper class

client. So these types of people want middle flat size in residential area. So think matter the

company select price strategy. Most of the project of this company’s is Gulshan, also

mohammadpur, Uttara, Kalabagan, Kathalbagan, Pallabi and Dhanmondi.

PROMOTION STRATEGY

The company Borak Real Estate (Pvt) Ltd. is very conscious how to promote their product. For

the promotion of company’s product they use some media.

News media : They give at least 10 days advertise out of 30 days in news paper for sale their

apartment in various location with different offer. Mainly they use the Ittefaq, The Prothom Alo,

The Jugantor news paper etc. as media.

Hand note: To promote their product they use hand note process. They give hand note a number

of targeted client for publicity their product and its location.

Festoon: To promote Borak Real Estate (Pvt) Ltd. use festoon as media of promotion strategy.

Company gives an excellent offer which is mention there and in hang on main road side.

Bill board: Borak Real Estate (Pvt) Ltd. also use bill boards for company advertise. Bill boards are

situated in main point in Dhaka city. Like front side of hotel Sheraton.

Web site: Details information of BRE’S web site. A large number of Probashi came to know about

BRE’S project and also company and finally they purchase their flat.

SALES ANALYSIS

After end of the year 2007 Borak Real Estate (PVT) Ltd. analysis their sales. The company is

successful to reach their visions. At the beginning of the year they make a plan for increasing

their sales. They are able to purchase 90 flat in 2007. Marketing department follows different

strategies and policies to convince the customer.

As a result marketing department is successful to increase their sales. Flat Sales in 2007 are

given flowchart:

Name of the month Quantity

January 7

February 5

March 9

April 12

May 14

June 14

July 18

August 20

September 16

October 17

November 12

December 13

MARKET SHARE ANALYSIS

When Borak Real Estate (Pvt) Ltd. started construction their project was only three. In that year

they sale only seven flats. In 2007 their project is 33 and they sold 95 flats in this year.

REHAB fair – 2007 which is held 19 th – 23 th February 2008 the company sale 15 flats. REHAB

fair 2005, 120 companies total sold 870 flats and Borak Real Estate (Pvt) Ltd. sold 13 flats which

is 1.27%.

In 2007 their total flat sale is 95 and all companies sold 19,975. Here their market share is 0.48%.

There are three categories Real Estate company in Bangladesh. First class company sales 3900

total in a year and second class company total sales 9100 in a year and Third class company

total sales 6975 in a year.

In 2007 Advance Development Technology sales flat 133, BDDL sales approx. 139, Navana Real

Estate ltd. sales approx. 135, Amin Mohammad sales approx. 141 and Borak Real Estate (Pvt)

Ltd. Sales 115.

PROFIT ANALYSIS

In the era of globalization, changing mindsets have recognized real estate as an important tool

for economic growth and investment. The importance of the real estate recognized as a

significant growth instrument. The greater volume of investment and development of real estate

will drive economic development and stimulate capital formation in an increasingly competitive

environment.

Planning for fund collections: Since it’s a real estate business, we need a huge amount of money

to invest in the Company, as we look for the long- term investment and maximize the wealth of

the company. In addition, administration and finance sector combined decided that we have a

need for Tk. 20 core or above. Only Tk. 1 core have available in our hand, assume that it will

provide by the private investment from companies shareholders. Therefore, the rest of the

investment would come from the external source and administration of the company give ensures

that they are able to create the fund from the following sources:

1. Long-term Sources

Customers’ Investment: 30% of the project. Marketing sector give us ensure that they are able to

attract the attention of the buyer of the project and can sell all the apartment with the 30% of the

customer’s investment.

Project ‘A’ will bear the cost approx. Tk. 8 core and will sell for Tk. 9 core. So, 30% of Tk. 9 core

is Tk. 2 core 70 lac which is 33.75% of the total cost.

Bank Loan: Tk. 3 core with a interest rate of 10% for the 10 years, which is 37.5% of the total

cost.

2. Intermediate–term Sources

Lease Financing Tk. 50 lacs for 5 years with a interest rate of 7% of the total investment. This will

be to buy the companies equipment.

3. Short-term Sources

Short-term loan Tk. 80 lacs that is 10% of the total cost of project ‘A’. This amount will collect

from the people of the company as a private loan with an interest rate of 6% according to the

company Act of Bangladesh, 1994.

Retained Earnings

Retain earnings is the portion of companies profit which is not allocated to the shareholders of

the company. These earnings will be termed as one of the sources of fund. As the company

starts from new, retained earnings is not available since now. However, after the project ‘A’, we

hope that some retain earnings will earn. This amount will investor further investment in the

company. However, this is depends on the dividend policy of the company.

It is noted that we estimate only for the project ‘A’. However, after a period we add with the

project ‘B’ and then we need the amount of Tk. 10 core. We will collect the fund according to the

way of project ‘A’. Rest of the Tk. 10 core will acquire from the earnings of project ‘A’.

As the company starts from now, dividend will be paid after 2nd year, when project ‘A’ and project

‘B’ will finished. Payment policy such that we can reinvest the majority part of retains earnings.

CONCLUSION

Borak Real Estate (Pvt) Ltd. has adopted the modern business concept. But even now they do

not get rid of from the traditional or conventional style. Moreover, the per unit cost of the products

of the company is higher than the major rivals. So, the company has to take initiative to maintain

the better quality at the lower unit cost from this moment. If they fail to achieve the target, the

opportunity will be closed but threats come as a cyclone. If they want to continue the current

sales growth and earn the same or increase the net profit margin they have to have concentrated

on their major default point.

In my three months internship program I have tried my best to observe the company BRE (PVT)

LTD. deeply. They have a good management team as well as marketing team also. I observed

that the top management is skilled enough to run the business smoothly. But delegation of

authority which is needed for getting better output from the employees.

For land procurement the company has no own agents to find out lands, they create apartments

under joint venture with the land owners. To procure lands they offer both apartment and cash to

the land owner.Unlikely the design department is not sufficient for the company. In the design

and engineering section, the company has structural engineer, civil engineers and architects for

creating apartments. But the company has no other engineers such as electrical engineer. They

do it from outside consultants.

The company is creating only one product, apartments of several sizes. The mainly create

apartments in the posh areas in the Dhaka city. We came to know that in near future they will

create commercial building and apartments in several areas. The company has the opportunity to

create apartments in the other metropolitan cities in Bangladesh.

Marketing department of this company is very strong than other departments. The personnel of

this department are experienced enough to sell apartments. The marketing strategies of this

company are strong to exist in the real estate market as a leader. The pricing policy of BRE

(PVT) LTD. is very attractive to the customers as a result their maximum apartments are sold out

before construction.

Legal side of this company is structured to face any kind of problems. But the logistics

department is unstructured. For this reason, the company has to bear a extra cost. The raw

materials procurement system is not structured, they have no substitute suppliers as a result they

face problems for constructing apartments.

Overall position of this company in the real estate market is good enough in this short period of

establishment. In this short period they create goodwill in the market and their target is to the

number one in this industry.

Three months are short time to know everything of a company and it is too difficult to recommend

something for the company. Even then I have tried my best to observe the overall position of the

company. On the basis of my little knowledge, I may suggest the following recommendations for

the smooth & successful operation of their business.