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In the beginning of 1978, it was planned by the government to
motivate as well as assist the Omani plans that serve up the framework, which
was the foundation established by Oman Cement Company. The company set up state
cement industrial unit in Oman to accomplish nation cement require, involving
offering occupations for Omani citizens, utilizing its own properties like
electricity, gas, water, investment, and manufacturing territory. Oman Cement
Company (OCC) looks intently of the modest technologies and assuring efficient
price procedures in obtainment, operation manufacture and sales. The company
sticks on to business principles, getting sufficient income for shareholders
and deliver high-quality products
Currently, Oman Cement Company has agreed to a development
plan to establish an innovative manufacture procession to enhance the ability
of cinder construction. In addition, Oman Cement Company has beendelegated an advisor
for management services for improvement, modernizations, and substitute of the accessible
packing plant. Rusayl Cement plant was the first plant for the company and it was
delivered in year 1983. And during the same year, the enchanting plant was placed
for manufacturing of cement having production ability up to 624,000 tons. In
1999 cindering manufacture ability extended to 1.2 million amounts in tons per
year. The next manufacture line was concluded in the middle of 1998. The
company was previously running to enlarge capability of plant form 1.26m tons
per year up to 1.70m tons per year. The increasing cinder accessible for cement
construction was about 1,479,762 MTS in year 2008, and 1,470,296 MTS amount of
cement was distributed by the company to reach high request levels. During the
same year, the cement sales gained by OCC 1,520,682 MTS of cement, and revenue
before tax in the year of 2008 reported as RO 12.109 million
Marketing
Strategy of Omani Cement Company
The recent strategies that Oman Cement Company has practiced
are based on certain points below:
The scope of Marketing Strategy of Oman Cement Company
The OCC’s major action is cement and cinder industrialized,
however referring to the yearly reports of OCC,
it is obvious that company focuses on its major section (cement
industrialized) at the side of including others actions buy stock from other
companies like Oman Frantschach Industrial packing company, which is major
paper bags distributor in Oman. Plus, OCC has located extra money in different Government
Bonds as well as other programmed securities.
Benefit through competition of Oman Cement Company
The company gets a lot of support from the government inside
the country, throughout its schedule to improve its essential businesses which
need it in terms of the infrastructure of the country. Moreover, the company
has utilized a variety of high-quality products which meet the requirements not
only to the standards in Omani but also the global standards as well. OCC
applies the best technology in the manufacturing process of its cement which totally
mechanized. This has given the benefit for the company to be on the list of the
vast developing companies in this business. OCC also created its essential
laboratory for monitoring and maintaining Quality Control. The company
practices Quality Management System (QMS) in accordance with the Quality
Assurance Procedures of ISO 9001: 2000 qualifications, and company’s
industrialized operations assumed to be friendly for the environment
Suitable strategic with the environment of Oman Cement
Company
The marketplace of manufacture supplies claimed to be a thriving marketplace, especially in Oman. There has been dynamic progress of the construction and manufacturing in Oman.
Suitable strategic with the environment of Oman Cement
Company
The marketplace of manufacture supplies claimed to be a
thriving marketplace, especially in Oman. There has been dynamic progress of
the construction and manufacturing in Oman ever since as the previous two
decades offered a big chance for OCC to be the leader of the other companies in
manufacturing this business.
Assets and capability of Oman Cement Company
Essentially rare resources are accessible in the
excavation close to the plant and represented raw material is about 98% which
is good for the OCC brand to create a great position in the Omani
External Environment Analysis of Oman Cement Company
The success or failure from a strategy is based on how the
company could review and observes the internal and external environment.
Strategy analysts and experts believe that the external environment for every
industry included three parts; they are Micro, Macro and opponent/s
environment. The external environmental part claimed to be the one that
persuades for cement manufacturing in Oman global as well as specifically in
Oman Cement Company as we will discuss in this section
Macro-environment Factors
There are six environmental factors which have persuaded the
business as mentioned below:
Political and authorized factor
It is clear that the government rules and policies have some
significant impacts on the company presentation; therefore these factors have
to be observed by the strategists and accustomed their planned strategies in
methods which direct the company to positive results as well as success. An
assortment of activities and progress in Oman built up tremendous increasing
require for cement. For the significant of cement manufacturing for expansion
strategy in long term, the government settled Oman Cement Company with 100% support
of government at the beginning, then after the essence of privatization rule,
the government assets condensed to only 51%. Another biggest local cement
company as the competitor of OCC is a private Raysute Cement Company (RCC)
The trend in the economy
Until the end of 2008, Oman contains a standard economic
with a stable and strong currency. The country also gets a profit for the
increasing costs of petrol. The stable economy in Oman along with the constant demand
for development has increased the marketing for cement itself which surpassed
the manufactures of the cement companies. Based on the yearly report, the
predictable amount of cement for 2009 reached 5 million tons. Along with the
affiliated company, the calculation has been made by the biggest financing
company for the daily request for cement in Oman in a number of 12000 tons
daily. These points to Oman’s economy is offering a benefit market, which is
best for the local cement companies to convince reliable request of the customer
and conclude their development
Social Trend
The populations in Oman presented the number of 2,743,000, and
also added with about 672,000 expatriates with the birth velocity is more than
3%. The standard age for the people in Oman to get married is below than 25
years. The vast development populations along with the growing amount of the
graduate young talent people take part in the business has made the expansion
on the presented building service, and vital infrastructure in the country
itself has increased a massive demand for cement. Developing profits and globalization
have switched the lifestyle of the people and their thought about the usage of
their properties as well. These factors lead to new building constructions,
reconstructions, and also modern styles of flats which replaced the simple
traditional houses. Therefore, the government motivated the local cement
companies to take part in the development of their country
The trend of technology
Nowadays, technology in cement industries has implemented essential
equipment for advancing resources. The use of technology minimized the cost and
enlarged manufacture which fulfill a huge demand, and also decreased the
negative released and pollution in the environment. Technology supports the
cement industries in many factors such as interactions, marketing, and handling
the information from customers to monitoring the demands and improve the
services as well
Legal aspects
The cement plants in running their business in Oman based on
the policies, which are directed by “the Ministry of Commerce and Finance”. The
registration of all cement companies is made under the Muscat Security Market
(MSM), which also set up their Commerce and Management, United Kingdom
Licensed, and also the International Journal of Economics with the agreement
with Ministry of Commerce and Finance. The Ministry has made the policy in the environmental
laws which required the cement companies to create the environment-friendly
working place and also addressing the issue in pollution.
The Internal Environmental Analysis
The internal analysis of environment involved local
business, rare materials, store, import, manufacture, management, supply and
distribution, quality control, training schedules, company policies, standards,
and all the impacts will be detail in this section
The strategic ability of Oman Cement Company
Oman Cement Company has a variety of best quality products
to reach the demand in the market which dwells of the regular Portland cement
and sulfate resistant cement. The strategic ability included in the two types
of resources within the company to survive in the industry, they are:
Physical resources of a company such as industrial
territory, factory, rare materials, and plant.
Nonphysical resources to be mentioned like the quality of
products, industrial ability, market status, and the understanding of
marketing.
The competitive benefit of OCC
There are many aspects which make Oman Cement Company become
better than the other competitors. The essential aspects are as mentioned
below:
Oman Cement Company manufactures high-quality products to
reach the market requirement for construction of block plant, building as well as stone tiles
industrial unit
The company has a variety of good quality products like SRC
(Sulfate Resistant Cement) which creates a low temperature of hydration when it
assorted with water. This type of cement is best to use when it is compulsory
to have high resistant against the chloride mobility. Such type of cement
creates an outstanding work capability, greater waterproofing, and high
resistance from rust anticipation of damage because it has Silica, Alkali
reaction.
The Company offers the best quality products at lower prices
than other company competitors.
For further expansion, Oman Cement Company as a significant
industry located in a strategic location
Oman Cement Company manufactures the modest SRC cement
following ASTM C-150-99 type
Oman Cement Company manufactures a specific cement for oil,
the development of fields which considered to be oil well with cement class having
G grade HSR (OWC “G), and also oil well having cement class A (OWC “A) which
following the standard of American petroleum institute (API).
SWOT Analysis of Oman Cement Company
A SWOT analysis is a foundation part analysis of a company
which assists the organization to figure out the prospect development strategy
of the company
Strengths: The most excellent quality, product name, the
assist from the government, and also the demographic sight.
Weaknesses: Deficiency on staff, older machine set up has
been turned off for maintenance manufacture because the company to get weakens
in reaching the demand from the market.
Opportunities: The Company produces cement with very high
quality in the Gulf countries. The requirement for SRC and OPC cement is quite
huge because of the quality product which enhances the customer attraction
headed for the Oman cement.
Threats: Due to world
monetary depression, the manufacturing business has to face a significant threat.
Cement order will drop if the manufacture work decreases. This could impact the
Oman Cement Company in the future. Furthermore, a number of UAE factories have
buried the local market as there is deficiency of cement production ability in Oman.
Competitive Alternative strategy for OCC
To get the number of competitive benefits in the cement
industries, Oman Cement Company needs to figure out about the competitive
strategy for the company to practice. The Strategy Clock from Bowman could be
implemented to study and analyze the competitive condition between Oman Cement
Company compared with the other companies. Oman Cement Company seems to follow
option number five on the Strategy Clock which is focused differentiation. It
is a fact that Oman is one of the most famous countries in petroleum export,
that is why Oman Cement Company began to manufacture a rare cement type which
utilizing purposely for oil wells. This kind of cement is in compliance with
the standards of American Petroleum Institute, as well as the company until now
is the only company in Oman which produces this kind of cement. And do not
forget that Oman Cement Company started producing another type of cement, which
is called Sulphate Resistant Cement. It can be used where high resistant to sulfate
molest is required, and where the demand occurs for the cement of this kind,
due to some geographical position of Oman, and distinguish faces moisture and
salinity, especially in regions, which are closer to the sea
Business environment or micro-environment
Based on five forces model by Porter, there are different forces
that pressure the presentation of business from a working industry. Here is the
list of those five forces for Oman Cement Company (OCC).
The threat of new contestant
The business of cement takes an important role for its
capital demand on plant equipment, building plants as well as product requirements
which not under than eighteen months to activate. And the rare materials of
cement area (milestone, Gypsum, etc.) are prescribed by the government in the
country. For that reason, the business is already conquered by two confined
companies that contain a long contract with the government for the development of
rare material in dissimilar sites.
Competitive competition
The two challenging local level cement companies RCC and OCC
are working in country’s divergent locations with instruction given by the
government, and they both acquire their revenue as well as trade all of their
manufactured goods even their market needs further. Moreover the cement orders in
the country are rising and surpassing the production capability of these local
companies. It is a fact that building plant cement comes with very high price.
The Oman Cement Company, which is located in Muscat having country’s 80% of the
manufacturing of cement.
Alternate manufactured goods
There is not alternate to cement for building as well as
manufacturing material in Oman in the nearby future, which means that the
product is certainly irreplaceable for now and shortly future as well.
Bargaining control of Buyers
It has been observed that demand for cement has exceeds all
the previous demand levels in the country. The government controls the two
factories manufactures and the prices the material for expansion. Shifting to
the companies of the adjacent countries, the products from these companies are
expensive as they come up with extra taxes as well as shipping costs. That’s
why, the bargaining control of buyers is almost zero, until any changes made in
the policy.
Bargaining control of
Suppliers
The majority cement elements are local and they are below
from management of the company, and except for less amount of bauxite for the
manufacture. This confirmed for zero suppliers’ control.
Porter 5-forces evaluation for the two Cement Companies in
Oman which are OCC and RCC presents that Cement Company is taking money-making
industry with a low business force. Oman Cement Company has its prime location in
Muscat and conquered the center along with the northern area with all
government main developments as well as constructions. This fact has provided benefits to OCC as
compared to its competitor RCC. However, RCC which runs the business on the
southern area also gets the benefit of free of charge exports to Yemen and many
other countries as well
Acknowledge the main competitor and measurement
of its strength and weakness considered to be an important component aspect to
set up the thriving of the marketing strategy. The dominant opponent of Oman
Cement Company (OCC) as mentioned above is Raysut Cement Company (RCC)
Based on the above summary report, we can see that both companies
get significant revenue. It is obviously evaluated that revenue of these companies
turns down in 2008 when it is compared with year 2007. The report also presents
that OCC revenue was less than RCC revenue. On the basis of RCC’s yearly
report, the exports to Yemen came with many benefits as distribution was made
with higher prices as compared to Oman, where prices fix proscribed as well as
settled with Ministry of Commerce and Finance to sustain the country plan in
construction and country’s crucial infrastructure
Conclusion of Oman Cement Company
It appears that Oman cement itself competently and
efficiently reaches and complete the Oman market demand as well as demands for
the Gulf countries. It can be ascertaining them as one of the market directors
in the cement manufacturing business. The company has got so many great assets,
and achieved a big deal of customers’ allegiance since the beginning of the
company and will raise more in prospect. Development and enlargement of this
company will able to assist the country financial and economics which will lead
the successful achieved for the country as well. Oman Cement Company offers nationwide
quality products with rational prices. That’s why; we must consider that OCC is
taking a great part in function to the improvement of the economy in the
country. The order of cement from Oman which exists in the market is quite
huge, and it seems impossible to reach the customers’ demand. This has pointed
out that the further chances of cement business appear to be attractive.
Figuring the condition in the market, Oman Cement Company needs to see how to
manufactures and figure out the actual strategy to achieve its aims and
objectives in the market industry. OCC can consider many choices so that they
can maintain their productivity with the enhancement in the investment to meet
the essential volume of abilities
Oman Cement Company seems to get steady revenue. Therefore, the company needs to provide better customer service, new products, and also get connected to the global market and completing public responsibility in the entire fields. In order to develop the country and reach the UEA market, Oman Cement Company must consider making another industrial unit in another industrial area. Oman Cement Company must follow the market demand in Oman to apply one of the unique business strategies to get benefit from other competitors. This can be done with manufacturing innovative products. In past years, certain industries from UAE access the local market in Oman due to the deficiency of supply against a huge demand. Therefore, Oman Cement Company must improve its ability and extends its productions lines as well. Oman Cement Company needs to always follow a well-arranged pricing rule to deal with the monetary crisis and considering investing in other companies to get more revenues.
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