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Term Paper

Value Chain Activities of Olympic Gold Battery

MGT 401

Section: 002

Submitted to:

Shawkat Kamal

Assistant Professor

BRAC Business School

Submitted by:

Raiyan Rahman 08104098

Tahsin Shoaib 08104077

Tawhid Rifat Ami 08104155

Imran Hossain 08104051

Submission Date

6th

April 2011

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Value Chain Activities of

Olympic Gold Battery

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6h April, 2011

Shawkat Kamal

Assistant Professor,

BRAC Business School

BRAC University

Subject : Submission of Project Report.

Dear Sir,

We are very thankful to you for giving us the chance of submitting a project report on

value chain activities. We worked on Olympic Gold Batteries. In the following paper, we

tried to get the information about Olympic Battery‟s value chain process through.

Thank you very much and we will cordially welcome any clarification and suggestion

about any view and commencement described through this report. Your feedback will

help us to improve.

Thanking you

Raiyan Rahman 08104098

Tahsin Shoaib 08104077

Tawhid Rifat Ami 08104155

Imran Hossain 08104051

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Acknowledgement

On Thursday 24th

March 2011, we had the opportunity to visit the Olympic Battery

Factory for the purpose of end-of-semester term paper for the course, Business Strategy

(MGT401).

Even though we worked really hard to complete this coursework, we would very much

like to thank every person, who helped us in various ways to accomplish our objective.

Mr. Kazi Mohiuddin Ahmed Reza, father of one of our classmate, contacted Mr. Madad

Ali Virani, Executive Director of the company for permission to visit Olympic Battery

Factory. Mr. Nazrul Islam, Deputy General Manager of the company cordially welcomed

us to the company. Mr. Nazrul was our major host. Mr. Mostafa Kamal showed us every

step of the operation process and helped us to understand various important steps. Mr.

Akhtaruzzaman helped us to understand the procurement process, while Mr. Mofizul

Islam explained and showed us the distribution process.

Lastly, I would like to thank our honorable course facilitator, Mr. Shawkat Kamal to

provide us with such a vast learning opportunity. This coursework not only helped us to

gain in-depth knowledge about the course, but also helped us to learn practical

knowledge about the manufacturing industry.

In future we would very much like to conduct such project work again, to learn about the

Manufacturing and other industries of Bangladesh. We would like to thank from the

bottom of our heart, every person involved in this major coursework.

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Table of Contents Introduction ......................................................................................................................... 7

Objective ......................................................................................................................... 7 Scope ............................................................................................................................... 7 Methodology: .................................................................................................................. 7 Limitation ........................................................................................................................ 8

Company Overview: ........................................................................................................... 9

Product Overview: ............................................................................................................ 10 Competitor analysis: ..................................................................................................... 10 Pricing Structure ........................................................................................................... 11

Analysis of the SWOT MATRIX ..................................................................................... 11 Chapter 1: Procurement .................................................................................................... 12

Chapter 2: Operations ....................................................................................................... 15 Chapter 3: Distribution ..................................................................................................... 20

Chapter 4: Marketing ........................................................................................................ 22

Chapter 5: Service ............................................................................................................. 24 Chapter 6: Secondary Activities ....................................................................................... 25 Conclusion: ....................................................................................................................... 26

APPENDIX ....................................................................................................................... 27 APPENDIX-1 ............................................................................................................... 27

APPENDIX-2 ............................................................................................................... 28 APPENDIX-3 ............................................................................................................... 29 APPENDIX-4 ............................................................................................................... 29

APPENDIX-5 ............................................................................................................... 30 APPENDIX-6 ............................................................................................................... 31

APPENDIX-7 ............................................................................................................... 32 APPENDIX-8 ............................................................................................................... 33

APPENDIX-9 ............................................................................................................... 34

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Executive Summary:

This paper describes the value chain activity of Olympic Gold (UM3) battery which is a

SBU of Olympic industry. Currently Olympic battery is in the second position in battery

industry. Special features and unique attributes differentiate it from other local batteries.

The value chain activity starts from Naraynganj Kachpur.

At procurement department they buy the inventory through LC and maintain a safety

stock level. We come to know about the manufacturing process of Olympic battery. The

manufacturing process is very much sophisticated and the factory is equipped with

modern facilities. After quality check and packaging the batteries are ready to sell in

market.

Olympic Industries has a strong distribution channel. Through it Olympic batteries are

distributed all over the country. In value chain activity they increase products value by

using a different marketing strategy they increase the value of the product. They are now

using both pull and push marketing strategy.

They have after sales service. If whole seller and retailer face any problem regarding with

the battery, the after sales service department immediately solve the problem.

We further explore the others secondary activities of Olympic group which are

responsible to run all the other operations smoothly. Olympic industry has several

departments like Accounting and Finance, Marketing, Human resource, Logistic

department and shares handling department.

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Introduction:

Objective:

The objective of this report is to analyze the value chain activities of Olympic batteries.

And also to look onto the various aspects of operation process, procurement, distribution,

marketing and other secondary services that is followed by the company. Another

objective of this report is to do this term paper for the completion of the MGT-401

course.

Scope:

The scope of our project is restricted to the value chain activities of Olympic batteries

only. It will cover an analysis on the operation, procurement, distribution and marketing

efforts of Olympic batteries. With the help of the analysis, we have prepared a SWOT

Matrix which might help the company to find out many new opportunities of venture in

the battery industry according to the current circumstances.

Methodology: Our term paper has mostly been done with the help of primary data collected from one to

one interview from Olympic batteries personnel. We have also gathered some

information about the company and some other information from secondary sources like

the official website of the company and other documents provided by interviewee.

For the primary data we first went to the factory located at Kanchpur, Narayanganj. We

were accompanied by a friend of ours Kazi Sakif Zaman Reza who arrange the meeting

for us. We went there and Mr. Nazrul Islam, Operations Head greeted us and introduce

with other staffs and officials. Then Mr. Nazrul Islam introduces us with Mr. Mostafa

Kamal who showed us the step by step operation process. Initially they didn‟t allow us to

take pictures but later we convince them and took pictures. Then Mr. Mostafa Kamal

introduce us with Mr. Akhtaruzzaman who described us the procurement process and

about the software which they use to run the procurement process. Then we went to Mr.

Mofizul Islam who described us the distribution process. At the end, we again went to

Mr. Nazrul Islam‟s room and he gave us some sample of Olympic Gold batteries and

Olympic Ball Pen. He also gave us their new product Nutri Bar. And this way we

collected all our necessary information from the Olympic battery factory.

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Limitation:

In the process of report writing we faced the following difficulties:

Due to the workload of the Olympic personnel, in some places we were not able

to gather all the required data and information.

The interviewer didn‟t give us any statistical information which might have

helped us for further analysis.

Due to some unavoidable circumstances, we had to change our company and we

later did this term paper on Olympic Battery. This gave us less time to complete

the overall paper.

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Company Overview: Olympic Industries Limited is one of the largest private sector industries in Bangladesh

which is engaged in diverse business areas. Olympic Industries Limited began in June

1979 as Bengal Carbide Limited. It has flourished its business in every possible sector

including pharmaceuticals, Power and Information Technology. It started steel

production in 1950s but Olympic Industries Limited diversified its business into different

consumer goods including biscuits, confectioneries, batteries, and ball pens, with over 40

brands and 53 SBU‟s. Consistently Olympic Industries Limited is providing high and

innovative quality products which its consumers can rely on. Olympic Industries Limited

is currently the market leader in the biscuit market and second in position in the battery

market in Bangladesh.

Today, Olympic produces three types of dry cell batteries (UM1, UM3 & UM4), a wide

range of biscuits, two types of handy ballpoint pens (Refill & Direct Filling) and even

confectionery items. Olympic Industries believe in quality. Persistent quality makes this

company different from others. It has been able to stride forward because of its

continuous vision for growth, its modern manufacturing facilities, and its extensive sales

and distribution network, and it has always yielded this influence to give back to the

community. Olympic Industries always try hard and sole to make innovative product and

make their product line diversified. Innovation is their main key of success. They always

try to meet consumer satisfaction and consumer expectation. Olympic Industries Limited

is a public limited company, trading on both the Dhaka Stock Exchange and Chittagong

Stock exchange.

The head office of the company is situated in Motijheel c/a and they have two production

plants situated at Kachpur Narayanganj. The milestones achieved by the Olympic Group

are given in APENDIX-1. The brand values of the company are provided in APENDIX-

2.

Source: Company Official Website. http://www.olympicbd.com

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Product Overview: Olympic Industries has become a household brand name by providing innovative product

that match continuous change of consumer tastes. Olympic's production line includes

three types of dry cell batteries (UM1, UM3 & UM4) .But the most selling battery is

Olympic Gold (UM3 R6). Olympic Gold delivers a dependable and powerful

performance. This product has the highest demand among the other brands produced by

Olympic.

Special Attribute:

- Heavy Duty Battery.

-Environment Friendly Battery.

-The Only metal jacket Battery

-Produced in Bangladesh.

-Each Battery is electronically tested.

-No rust easily applicable

-Instant power supply

-Reliable

-Durable

-Temperature and pressure protective

-Leak proof

-Double layer protection

Competitor analysis:

The major Competitor of Olympic Batteries is SUNLITE battery produced by Quasem

Dry cell Limited. There are also other international and local competitors like Sony,

Walton, Maxwell, and Sonica. A comparison of different uses of battery of different

products and their durability is given in Appendix 3 &4.

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Pricing Structure

Brand Price per pair

UM-1 Olympic Gold Size D BDT 40

UM-3 Olympic Gold AA BDT 20

UM-4 Olympic Digital AAA BDT 30

UM-3 Olympic Power AA BDT 22

Analysis of the SWOT MATRIX

The SWOT analysis and the SWOT Matrix has been provided in APPENDIX-5 &

APPENDIX-6. The following section describes the strategies found from the SWOT

MATRIX.

Strength-Opportunity

1. Alkaline and rechargeable batteries are not produced in Bangladesh but it has a

very good prospect in this country. Olympic Batteries Ltd has been operating for a

long time in the Bangladesh market and has a good brand image, with the launch

of alkaline and rechargeable batteries in its product list; it can further increase its

product range.

2. Olympic Batteries Ltd has very high production capacity and produces quality

drycell batteries, it can aim to produce more and export these batteries to Mid

East African countries, where the demand of drycell batteries still exist.

Weakness-Opportunity

1. The drycell batteries can be used in other ways than conventional way. For

example four drycell batteries can be combined and a circuit being made, this can

be used to charge mobile phones when people are at remote places. Olympic can

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give more marketing efforts in the form of advertisement to make people aware of

such uses of batteries.

2. Olympic Batteries can emphasize more on research and development to alkaline

and lithium batteries and increase their market share.

Strength-Threat

1. Olympic Batteries Ltd has been operating for the past 29 years and already knows

how the consumers react. They can use this experience and their brand image to

tackle the price sensitive customers.

2. As Olympic Batteries Ltd imports almost most of its raw materials, the increase of

the price of raw materials and foreign exchange rates can be tackled by increasing

the number of units produced and achieving economies of scale.

Weakness-Threat

1. Olympic should emphasize more on the Pull Strategy and produce more

advertisements and other marketing efforts to increase the demand of the drycell

batteries.

2. Olympic needs to spend more on R&D and come out with new raw materials for

their products, which can be acquired cheaply.

Chapter 1: Procurement

1.1 Procurement

This is the process of obtaining goods and services from preparation and processing of a

requisition through to receipt and approval of the invoice for payment. Procurement can

be defined as the responsibility for obtaining (whether by purchasing, lease, hire or other

legal means) the services, equipment, materials or supplies required by an organization so

it can effectively meet its business objectives.

The procurement process not only involves the purchasing of commodities but also

quality and quantity checks. Usually, suppliers are listed and pre-determined by the

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procuring company. This makes the process smoother, promoting a good business

relationship between the buyer and the supplier.

Olympic batteries do the procurement process with the help of head office of Olympic

Industries Limited. Basically procurement process is done by the Olympic battery to run

the operations and ultimately the business smoothly. Olympic batteries import the raw

materials and other components from different countries like India, China, Taiwan, Peru

etc.

Olympic batteries go through several steps to do the procurement process:

The head office of Olympic Industries Limited with the help of marketing department

and mostly with the sales people through research, market information and past sales

information able to know the demand of the products for coming three months. Then this

information passed to the procurement department of Olympic batteries which situated at

the factory of Olympic battery in Kanchpur, Narayangonj.

With the information procurement department of Olympic batteries estimate the raw

materials and other components that are needed to manufacture the batteries.

Along with that a report has been submitted to the procurement department of Olympic

battery every week from the floor of consumption. This report actually shows that how

much inventory is left in the manufacturing plant and also to meet the demand how much

inventory need to procure.

Olympic batteries maintain a safety stock level of three months. The report from the

floor of consumption gives the idea of how much inventory is needed. A monthly

analysis of the inventory estimates the inventory requirement to meet the demand given

by the marketing department.

Olympic batteries use the Inventory Management Software to maintain the inventory

level and with the estimated sales target from the marketing department can be

maintained. This software can give the information that how much inventory is required

to meet the target level of production.

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Olympic batteries mostly import their inventory through Letter of Credit (LC), as LC at

least takes the time of three months; therefore Olympic batteries maintain at least three

months stock safety level to run the operations smoothly. The procurement department

also uses the Microsoft excel to entry the information of inventory (raw materials and

other components) from the report of the floor of consumption and this task is done

manually. In the excel sheet there is a list of inventory ( raw materials and other

components) and the information of inventory that how much inventory is left in the

stock of Olympic battery production facility. To meet the targeted sales, in the excel sheet

procurement department manually put the figure in excel and find the amount that needs

to purchase to meet the demand and also to maintain the safety level. The Inventory

Management Software system automatically updates the requirements and the date need

to do LC to achieve the estimation of sales targeted by the marketing department.

The procurement department then sends a report and purchase requisition order to the

head office of Olympic Industries Limited at Motijheel, Dhaka. Then the responsible

department of the head office analyses the report and contact the supplier who can

supplier. If the inventory is already been purchased from common supplier then head

office make a purchase order and send it to the supplier and also does the LC from a local

bank.

Bank does the LC procedure on behalf of the Olympic Industries Limited and collects the

inventory from the supplier. Bank is also responsible to supply the products to the factory

facility of Olympic battery from the supplier. Bank hires or outsources the transportation

agency to supply the inventory to the factory facility of Olympic battery at Kanchpur,

Narayangonj. Mostly inventory is transported by road and by water route as well. Most of

the inventories that come from India are transported by road.

After the raw materials reach the factory, the weight and other specified measurements

are being taken at the laboratory of the factory and kept in the ware house of Olympic

batteries factory facility at Kanchpur, Narayangonj. Generally errors are not found, but if

in some case there is any fault the raw material is kept aside and Olympic contacts its

supplier. The overall procurement process follows some certain steps and it is given in

APPENDIX-9.

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1.2 Recommendation:

Instead of using Microsoft Excel they can use more sophisticated software to keep a track

of the inventories.

Chapter 2: Operations

After the procurement part is finished, and all the raw materials have been properly

weighted, measured and put into the ware house, the main process of production starts.

This is that section of the production process where the raw materials are turned into

finished goods. In this part the main value is being created in the value chain.

In Olympic battery manufacturing factory, there are 150 dedicated workers both male and

female who work in the production line of Olympic battery. With a monthly capacity of

6000 cartons of Olympic Gold AA batteries, the factory is fully equipped to run the

facilities. Each batch of battery requires 20 days to be produced, starting from the can

making to the final product packing and many testing in between.

The operations of the making the Olympic Gold AA battery can be considered quite

simple yet very interesting. The operations in the plant of the battery go through about 20

steps before the battery is completed into a finished good for consumption. The overall

process takes place in 4 different rooms, namely the solution room, the cathode mixing

room, the main production room where the other product line e.g. Olympic Gold (UM-1)

is present and finally the packaging room where the final product is being packaged and

cartooned. With each machine in the production line, there is one to two workers

operating the machines and checking the products. The description of the operational

process of Olympic Gold AA battery is given below:

2.1 Solution Room (Sub process)

This is an initial step that needs to be carried out before the actual operations start. In this

stage, an electrolytic solution is being made. After the chemical raw materials have been

properly weighted, they are kept in the solutions room. Here Sodium Chloride (NaCl) and

Zinc Chloride are being mixed with de-mineralized water to bring out impurities and

make the solution pure. This solution is needed to maintain a PH Acidic level of below 7.

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2.2 Cathode Mixing Room

For the manufacture of a drycell battery, we need to make two parts, cathode and anode.

In this first stage of the operations process, the cathode mix is being done. The cathode

mix is being made by mixing manganese dioxide, carbon black and Electrolytic solution.

The manganese dioxide is called electrolytic manganese dioxide, for other sort of

batteries like UM-1; natural manganese dioxide is being used. Both manganese dioxide

and carbon black are being imported from outside the country. And the electrolytic

solution is being made from the previous sub process. The cathode mix formed looks like

black powder and is stored in huge cartons until it is needed in future production. There

are two big sophisticated cathode mixing machines which is being used for making the

cathode mix of all the batteries of Olympic.

2.3 Zinc Can Preparation

In this section there are three processes that are being done; the extrusion process, the

trimming process and the zinc can feeding process. These steps are being done to make

the outer shell of the battery.

2.3.1 The Extrusion Process

In this stage, a small cylindrical shaped material called the zinc cannon is put inside the

machine and it is made into the outer hollow shells of the battery. These zinc cannons are

being imported from India. The process is being done by putting the zinc cannon in the

extrusion machine. The shells that are being made in this stage are called zinc cans.

2.3.2 The Trimming Process

After the extrusion process is being done, the shells automatically move to the next stage

of the production. In the extrusion process, the shells being produced don‟t maintain a

specific length. But the shells have to maintain BSTI (Bangladesh Standards and Testing

Institution) specific lengths. Thus this trimming process is being carried out to cut off the

extra edges from the zinc cans and shaping it with the help of the trimming machine.

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2.3.3 The Zinc Can Feeding Process

The trimmed zinc cans now automatically moves to the next stage where all the open

ends of the zinc cans are being assembled in one direction. This process is mainly done

for the coming processes where materials are being put inside the zinc can.

2.4 Paper Separator

In this stage, a hard brown paper is being inserted inside the zinc can. This is done so that

the mixing can be separated.

2.5 Bottom Washer

When the zinc can moves to the next stage after the insertion of the paper separator, a

metal washer is being put at the bottom of the can with the help of the bottom washer

machine. This bottom washer helps in separating the bottom side.

2.6 Bobb In

This is one of the most important stages in the overall operations process. When the zinc

can moves here to the Bobb In machine after the insertion of the bottom washer, the

cathode mix made in the cathode mixing room is being inserted inside the zinc can.

2.7 Plastic Washer

When the battery is being used and starts working, a gas is produced. This next step

makes a space for that gas to be stored inside the battery. Above the cathode mix inside

the zinc can, a plastic washer is being put by the plastic washer machine to store the gas

produced during the reaction. This is also called the plastic cap insertion process. The

plastic caps are being made in Bangladesh and supplied to Olympic battery by an outside

supplier.

2.8 Carbon Anode Insertion

As the can moves up to this stage, another important part of the whole operations process

is being done. As mentioned earlier, a drycell battery needs both cathode and anode ends

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to make it work. The cathode mix has already been put inside the zinc can. And now the

anode part will be filled inside the zinc can. To do so, a circular carbon bar is inserted.

This bar is also imported from abroad in specific shape and length according to the need

of Olympic battery. This carbon anode is also known as filling compound.

2.9 Sealing Washer

In this stage, a washer is being put above the filling compound. This process is being

done by the sealing washer machine. It is done to keep the filling compound in a fixed

position.

2.10 Sealing Compound

The washer that had been put in the preceding stage, is heated in 250 C. This power pack

is being done so that no leaking takes place.

2.11 Combinatory Cap

In this stage, a metal cap is being but above the zinc can to make the top cover of the

battery. At this stage the actual battery has been completed. This process is being done by

the combinatory capping machine.

2.12 Edge Curling

This is the stage where the rough edges of the battery are being smoothened to give it that

fine smooth touch.

2.13 Automatic Testing Board

After the edges have been smoothened, the battery needs to be checked to verify its

voltage and current. This is being done with the help of an automatic testing board where

is tested to find out its ampere and volt. The BSTI requirement is 1.5V, but Olympic

gives a bit more e.g. 1.65V or 1.66V so that the consumers can use the batteries longer. If

a battery doesn‟t give any volt reading, or gives a reading below 1.5V, it is being checked

again and if still the readings don‟t change, the battery is being rejected. After the battery

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has been tested, the batteries are being kept in shelves of boxes for 10-15 days before the

start of the next stage.

2.14 Grouping

The grouping machine helps the batteries to be assembled in a group in a straight line

along the assembly line. After the tested batteries have been stored for 10-15 days, they

are being put into the grouping machine and lined up for the coming processes.

2.15 Automated Testing Machine

After the batteries have been lined up by the grouping machine, the second phase of the

production starts. To start, the batteries are again being tested to check the ampere and

voltage readings. And now, if any battery fails to give a rating of 1.5V or above, they are

being rejected.

2.16 Labeling

In this stage, the battery is being wrapped up with a printed PVC sheet where the product

name (Olympic Gold) is written along with the company details and the precautions are

given. This labeling is being imported from India and Taiwan. Olympic gives order to

them along with the design and they just produce it and exports to Bangladesh. This

process is being done using a sophisticated labeling machine. Then the PVC is being

heated so that it gets stuck to the battery. This is done so that any plastic part from the

PVC doesn‟t come out easily. Then again the batteries are being stored for 3 more days in

shelves of boxes.

2.17 Physical Quality and Appearance

This is the third stage of the production process. After 3 days, the boxes are brought out

by the workers and are being manually checked by the workers to find out the color of

the batteries and its physical quality. At times, there are impurities which get stored in the

bottom of the battery, if something like this is found in the battery, the battery is being

rejected.

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2.18 Blistering

In this final stage, the batteries are being packed in a pack of 10 batteries per pack. This is

being done by a blistering machine. There is poly vinyl chloride also known as rigid sheet

which takes the shape of the 10 batteries and printed PVC at the bottom is being attached

where “Olympic Gold” is written. After the packaging is being done, the packs of 10

batteries are being put into small cartons manually and tape sealed and then sent to the

warehouse. These cartons of batteries are ready to be dispatched to the distributors.

The flow chart of the overall operation process is shown in APPENDIX-7.

2.19 Recommendation

The production line can be made more efficient. The production process is carried out in

4 rooms in the factory; one of their halls is really big, if the whole production line is

brought in this hall, and the production line is made in a „U‟ shape, it becomes more

efficient. If Olympic can bring foreign personnel from this industry, and give training to

the workers and make them more efficient and improve their productivity.

Chapter 3: Distribution

3.1 Distribution Process

Olympic Industries Limited is currently the market leader in the biscuit market and

second in position in the battery market in Bangladesh. Olympic battery is one of our

very first dry cell batteries to be launched. Olympic batteries are available in the market

with different brand name and size.

Olympic Industries Limited has perhaps the most extensive sales and distribution

network in Bangladesh, with a field force of just under 1,000 people representing each

and every region of the country, boasting Olympic‟s products‟ in even the most far-

reaching, remote corners of the nation. The Sales Force uses over 300 distributors

nationwide and sells products to a total of over 4,00,000 outlets across the country.

Moreover, Olympic‟s products are prominently displayed on the store signs of over

1,00,000 stores nationwide.

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In addition, the Sales Force is equipped with the latest mobile devices and technology to

ensure their operations are as seamless and automated as possible.

After the procurement and operation process batteries are store for 20 days. They keep in

a cool and dry area to distribute. Distribution process is coordinated by the head office

because they receive order and according to their demand they inform it to the factory. In

the factory they start to shape the raw materials into finished goods. To run this process

they have to overcome the procurement and operation process. Olympic has their own

distribution channel and they allocate one distributor in every thana. The number of

distributor is approximately 300. It has made the distribution process easier to distribute

the battery. It is the duty of that particular distributor to distribute the product in that

particular area. Olympic sets a target over the distributor to distribute certain amount

battery over the month. Salesmen receive the order from the retailers and inform it to the

distributor then distributor delivering order to the head office. Then head office informs it

to the factory and the route of order being made by the factory and products dispatched.

When the demand of the product is high than the supply then distributors inform it to the

factory and factory made permission from the head office. Sales target is allocated

according to the delivery order.

Total delivery process is done by a recognized transport system which is outsourced by

the Olympic factory. Head office gives the order to the factory through the internet. Vat

is included with the price of the product and it has fixed before the distribution process.

After distribute the product in different districts the products are kept into the warehouse.

From the warehouse the products are directly placed into the retailer‟s store. All the

transaction has made on cash, no transaction process is made under credit. Retailer

receives their product and pays for the product.

Olympic company uses truck, mini truck, van, cargo van to distribute their product. They

use the same vehicle to distribute all their products. When they distribute in a particular

area they also distribute other products along with the battery near to that area so that

they can reduce the costs. Internal distribution among the thana is run by the van.

Olympic assign some sales representative in every thana who can tell about the benefits

and feature of the product and do some sales promotional activities. They also work as a

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distributor because sometimes they also distribute some free samples among the retailer.

Sales representatives give the order this work is not done by the distributor.

Audit department checks on the distributor. Is the distribution process running frequently

or not these types of decision has made by the audit department. They check the in and

out of the distribution process.

The overall distribution process follows some certain steps and it is given in

APPENDIX-8.

3.2 Recommendation:

Olympic has no retail outlets to distribute their products. So, they can introduce retail

outlets, it will be easier for them to get the end users. They can use their own

transportation system to minimize their costs and display banners of their products on

those trucks. There should be a direct communication between the distributor and factory

office so that the delivery processes run faster.

Chapter 4: Marketing

4.1 Product:

Olympic industries produce Dry cell batteries. Olympic Gold (EMU3) is popular among

all the dry cell batteries. It is made by a fully automated dry-cell production line. It has

more moisture, more compression, Better sealing, Superior internal structure, more life

compared to other dry cell batteries. So it makes itself distinct from other batteries. And it

has a great popularity in the market.

4.2 Price:

Olympic industries follows both cost based and competitor based pricing. They follow a

method in which a fixed sum or a percentage of total cost is added to the cost of the

product what is arrived in their selling price. And in competitor based pricing, they use a

price which is very much competitive. So they have set a price in a way that is

competitive and that will make profit for the company. The price of One Olympic Gold is

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TK 10. Where as their main competitor is selling their battery at taka 10. And Olympic

Gold is better than them in terms of features and quality.

4.3 Place:

Place represents a location where the product is placed for selling purpose. As we know

Olympic industries have most extensive sales and distribution network in Bangladesh.

Olympic Gold battery is found in every possible corner in Bangladesh. As Olympic

industries are pioneered in making confectionary items and they distribute their product

all over the market with their strong distribution channel. Olympic industries distribute

their all product in a same way. So here they are minimizing their cost in placing their

product in the market. They have 300 distributors and Olympic Gold is found in 400000

outlets in the country. They have a strong network to sell their product. Their factory is

situated at Kachpur, Narayanganj and it‟s a prime location. So they get competitive

advantage in distributing their product all over the country.

4.4 Promotion:

They are following a different promotional strategy for Olympic Gold. After 2010 they

did not go for TV advertisement. They do their advertisement through bill board. And

they set store display. They follow push marketing strategy where they influence

wholesaler, retailer to promote their product. They also give incentives, coupons and

other facilities to the retailers and wholesalers. As in our country the demand is

downward and people buy the battery by not their brand name rather than what they get

near to their hands so Olympic industries is trying to promote their product in every

possible shop. But they are now trying to create demand in the market. So now they are

interested in Pull marketing.

4.5 Packaging:

OLYMPIC gold is very much attractive and eye catchy for its packaging.. They are

trying to differentiate their product with their packaging. They also make OLYMPIC

POWER. It is also a drycell battery. Basically Olympic power and Olympic Gold is

same. But they have differentiated both batteries by their packaging. Olympic Power is

24

sold at taka 11. In this way they are creating demand for Olympic GOLD for better

quality battery in a lower price and make product differentiation.

4.6 Recommendation:

Olympic industries can imply many things to improve their marketing strategies. They

should go for TV advertisement, Newspaper advertisement. At present they are following

Push marketing. But the market is very competitive and market is very much price

sensitive so they need to aware consumers about the brand and they need to go for Pull

marketing strategy. For this they need to use print media, electronic media. They need to

emphasize on customer relationship. If they follow both push and pull marketing strategy

simultaneously, then it will be more effective for Olympic batteries

At present they are the market challenger. SUNLITE battery is market leader. Olympic

Gold is trying to expand their market with better quality product and strong distribution

network. And their market share is increasing. They are also dealing with product

innovation. They are trying to make Olympic Gold more durable and better.

Chapter 5: Service

Olympic industries have a service department for the distributors. They keep their service

department to serve the distributor, not the end user. Though they have a very good

product quality control, still if the distributor finds any default in their product, they

contact the customer care service. The distributor writes down report about the problem

and sends it to the customer service department. Then the customer service department

makes inquiry about their product, if required calls back the batch of product and replace

it. Customer service department not only solve the distributor‟s problem but also they add

value by giving incentives to their distributors. This department also gives gifts to the

distributors who perform extraordinarily. Olympic arranges annual picnics for

distributors with their families.

25

In Olympic‟s official website, there is also a section named “Complains”. In this section

is any customer or distributor has any complaints regarding the product or something

else, they can fill in the form and the customer service officer will get back to him/her.

Chapter 6: Secondary Activities

Olympic Industries has several departments like Accounting and Finance, Marketing,

Human Resource, Logistics department and Shares handling department.

6.1 Accounting and Finance department:

Olympic industries have an accounting and finance department which consist of 25

employees. There is a single accounting and finance department to do all the work of

Olympic Industries. Accounting and finance department of Olympic Industries basically

do all the transaction process of the organization. Accounting and Finance department of

the organization do the budgeting, funding and buying process that actually needed to run

the operation. Olympic Industries market research team do the research to estimates the

demand of the products and on the basis of that procurement department sends the

purchase order to the Accounting and finance department. Accounting and finance

department makes the purchase through Letter of Credit (LC) with the bank. Accounting

and finance department also allocates the budget to the different levels of organization.

The salary of the employee and other maintenance cost is approved from this department

as well. Accounting and finance department also funds to buy the raw materials from the

supplier, to buy the new machineries and other transactional process.

6.2 Human Resource department:

The human resource department of Olympic Industries basically does the management of

the employees inside the organization. There is a small department of Human resource in

the Olympic Industries consists of only one stuff and do the work to fill the vacancy post

with the right stuff in the Olympic Industry. The human resource department of the

Olympic Industry does both the internal and external recruitment. External recruitment

26

occurs by giving the circular in the news paper and through internet to recruit the

employees. Internal recruitment happens when a stuff change or shift one department to

another department of the organization. They basically arrange recruitment process and

do the paper work of the applicant to do the recruitment and the department which is

recruiting the employee takes the interview of the applicant and hires the staff.

6.3 Shares handling department:

Olympic Industries have a very strong shares handling department which consists of 10

employees. The shares handling department do the analysis of the stock market and the

main work of them is to issue the new shares to the stock market. This department also

does the general meeting with the investor and the head of the organization to manage the

shares in the stock market. Shares handling department always keep connection with the

stock market and analyze the performance of the stock of the company in the stock

market.

6.4 Logistics department:

The logistics department of the Olympic Industries manages the work of distribution and

procurement process of the organization.

Conclusion: After doing the project we got a clear concept on value chain activity of Olympic

batteries. The project provides us with both theoretical and practical knowledge about the

production, procurement, distribution, and marketing process of Olympic battery.

Currently they are the market challenger. They believe in taking the challenges

positively. And after doing the SWAT analysis we think if they emphasize in some of the

fields specified over there like introducing new products, exporting and improve their

efficiency in some sectors they can aim to become market leader. Thus we believe this

the understanding that we gathered from this paper will certainly help us in our future

workplace.

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APPENDIX

APPENDIX-1

MILESTONES

June 1979: Incorporation as Bengal Carbide Limited

April 1982: Commencement of UM-1 Battery Production

June 1984: Listing on Dhaka Stock Exchange Limited

September 1987: Commencement of Soyabean Oil & Vegetable Ghee

Production

September 1991: Addition of Palm Oil & Olein Capacity

August 1995: Expansion of Production Capacities to Produce UM-3 Batteries

June 1996: Name Change to Olympic Industries Limited

September 1996: Listing on Chittagong Stock Exchange Limited

December 1996: Commencement of Biscuit & Confectionery Production

January 1998: Commencement of Ballpoint Pen Production

November 1998: Commencement of Electric Bulb Production

July 2003: Olympic installs its Second Biscuit Production Line

July 2008: Olympic Install its Third Biscuit Production Line

August 2008: Completion of Amalgamation of Tripti Industries Limited with

Olympic Industries Limited

Source: http://www.olympicbd.com/index.php/about-company/history

28

APPENDIX-2

Source: http://www.olympicbd.com/index.php/about-company/brand-values

29

APPENDIX-3

Motorized toy test (practical) UM-3

Source: Slides provided by Mr.Mostafa Kamal

APPENDIX-4

Camera flash test (Practical) UM-3

Source: Slides provided by Mr.Mostafa Kamal

0

20

40

60

80

100

120

140

Olympic gold Sunlite Haque Osel Sony Olympic Digital Olympic Power

Tim

e(m

inu

te)

Brand name

0

20

40

60

80

100

120

140

160

180

Olympic gold

Sunlite Haque Osel Sony Olympic Digital

Olympic Power

Fla

sh

(cycle

)

Brand name

30

APPENDIX-5

Figure: SWOT Analysis of Olympic Batteries

Strength1. Lengthy market existence.

2. Good Brand Image

3. Product Variety.

4. Strong Distribution Channel

5. Imported Quality Raw Material

6. Good Quality Control

7. High Production Capacity

Weakness1. Less Marketing Effort

2. Emphasis on PUSH Strategy mainly.

3. Produces only Drycell Battery.

4. Less Research and Development

Opportunity1. Producing Alkaline Batteries and Rechargeable Battery

2. Export their batteries to developing countries.

3. Produce Car Batteries.

4. Creating awareness of other uses of drycell batteries.

5. Electricity problems in Bangladesh.

Threat1. Decrease use of Drycell Batteries

2. Cost of Raw Materials Is increasing

3. Industry is getting in its decline stage.

4. Increase in the number of price sensitive consumers.

5. Foreign Exchange Rate.

SWOT

ANALYSIS

31

APPENDIX-6

Figure: SWOT Matrix of Olympic Batteries

Strength-Opportunity1. Create an Alkaline and rechargable battery market for the mass.

(S1,S2,S3, O1 ).

2. Export Quality Batteries to Developed Countries as Olympic has high production capacity.(S3,S5 ,S6,S7,O2)

Weakness-Opportunity1. Giving more efforts in marketing to create awareness of other uses of Drycell Batteries.(W1,O4)

2. More research and development efforts can be done for products like alkaline or lithium batteries.(W4,O1)

Strength-Threat1. Tackling the price sensitive customers with long market experience and brand image. (S1,S2,T4)

2. They can tackle the increasing raw materials prices by increasing the production and decreasing per unit cost by economies of scale. (S7,T2,T5)

Weakness-Threat1. Pull Strategy and more marketing effort can be done to generate demand.(W1,W2,T1).

2.Research can done to find out alternative cheaper raw materials. (W4,T2)

SWOT Matrix

32

APPENDIX-7

33

APPENDIX-8

34

APPENDIX-9

Figure: Procurement process of Olympic Gold batteries

Suppliers of

raw materials

Raw materials

Purchase Order

Through the

process of LC,

purchase order

Raw material

test at laboratory

Olympic Gold

batteries

factory facility

Report from

floor of

Consumption

Head office of

Olympic Industries

Estimates the demand of products

by marketing department

Procurement

department

Requirements of raw

materials order

Inventory

management by

software

Warehouse of

Olympic Batteries