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Report on Rahima Afroz Globatt

Rahimafrooz . Executive summary Rahimafrooz Globatt Limited, after one year of establishment has become one of the main focuses of Rahimafrooz group. Still not sufficiently developed to become a true global company but enough potential and performance it has shown last one year. As a lead acid battery manufacturer company from Bangladesh, RGL has many constraints in its journey. One of the major constraints is the manufacturer country – clearly international buyers do not see Bangaldesh as a manufacturer of automotive batteries. But when they visit RGL office and factory it makes them amazed.

Still, long way ahead of RGL but first year showed its bright future. All of strengths and weaknesses of the company indicates that RGL is right on the track of becoming a global venture. Each and every departments of RGL is showing the kind of competency and skill which is needed for a company to become successful. The objectives have set depending on the current situation of the company as well as the comparison with market leaders. RGL’s product and price has developed and established on the benchmarking with the big players.

Marketing, Finance, HR, Production and other departments have their own objectives as well as a combined objective directly related to the growth of the company. Recruitments and benefits of the employees are kept separate from the group HR which indicates the intention of recruiting competent people in RGL. To reveal international market, marketing department is continuously participating in large international trade fairs and regular market visits of key account managers. RGL’s product has been designed in consultant with a reputed German company and this has been proved that RGL products are better quality products.

The Chief Operating Officer, The Head of Marketing and other key members truly believes that RGL will become one of the largest manufacturers of batteries in the world. Table of contents: 1. 0Introduction 1. 1Background of the company 1. 2Objectives 1. 3Scope 1. 4Methodology 1. 5Limitations 1. 6Contact person 2. 0Management/Human side 2. 1Vacation 2. 2Special facility 2. 3Training programme 3. 0Production and Marketing 3. 1product 3. 2service 3. 3marketing strategy 3. 4pricing 4. 0Accounting and Finance 4. 1 5. 0Corporate social responsibility Conclusion and recommendation Glossary Reference Appendix

Table of charts and illustration List of abbreviations Objectives: 1. To find the detail information of the departments of RGL 2. To find the opportunities and threats of RGL being the export oriented lead-acid battery manufacturer from Bangladesh 3. To study the organizational structure of RGL and efficient work delegation 4. To observe the emergence of a company with ambitious vision from more than 50 year experienced mother company 5. To study the company strategy and penetration policy for global market 6. To understand the importance of social responsibilities of a company from the activities of Rahimafrooz

Scope: 1. In financial areas, RGL operates with utmost confidentiality as per their policy. So, given information in this report analyzes the company materials as provided. 2. In some activities, RGL is entirely separated from the Rahimafrooz group or other Strategic Business Units (SBU) of the group. But in some other areas they operate under group supervision. Report contents organized as per their organizational work flow and structure. Clearly in some areas; RGL, RBL (Rahimafrooz Batteries Limited), RDL (Rahimafrooz Distributions Limited) and others work together as Rahimafrooz. 3.

As RGL is established in 2008, major focus of the report concentrated of the company information during this period. 4. During the preparation of the report, all information has been collected from RGL and Rahimafrooz Corporate Office. Methodology: Subjective analysis of RGL has been done in co-operation with the employees of RGL in their Head Office and also from the data provided by them. At first, the areas have been classified from the point of view of their operation. There are certain areas where RGL operates exclusively in their own authority which is separate from the group.

Other areas are common for all SBUs of the group. RGL has prepared their own Processes, Manual and Information Center which has helped us a lot in preparing this report. Group activities have been gathered from Rahimafrooz Corporate Officials. A questionnaire has been prepared for the officials and they have been randomly picked for the data collection. All in depth analysis has been done with the data collected through questionnaire. The SWOT analyses of RGL, the objectives, the future potential of RGL etc. are the result of analysis of questionnaire data.

Limitations This report has fully been prepared on the perspective of the experience of students who are just a beginner, studying in business. We acknowledge our limited understanding on it. Chapter 01: Background Background: Significant changes Rahimafrooz Globatt Ltd. has been emerged to pertain years of experience of Rahimafrooz to international market. Rahimafrooz started its journey as a trading company in 1954 which established its own factory in 1960 and started its sales operations. In 1992, Rahimafrooz exported its first consignment to Singapore.

As export market grew bigger Rahimafrooz Globatt Ltd. has been formed in 2008 as an independent company to operate solely for global operations. 1954Rahimafrooz was incorporated as a trading company. 1959Collaboration agreement with LUCAS, UK for setting up manufacturing and distribution business of Lead-Acid Automotive batteries at Dhaka, Bangladesh 1960Establishment of Battery factory at Nakhalpara and launching of sales operations. 1980Acquisition of LUCAS Services (BD) Ltd. by Rahimafrooz and change of name to RAHIMAFROOZ BATTERIES LTD. 1982Introduction of “dry charged” plastic case battery. 990 Establishment of independent lead oxide plant for sales to all battery manufacturers. 1992Manufacturing Collaboration agreement with Chloride group, UK. First consignment of battery export, country Singapore 1994Acquisition of YUASA Battery (Bangladesh) Ltd. plant at Zirani Bazar. 1995Export market expanded to Middle East, Nepal, Bhutan, Sri Lanka, Myanmar and Pakistan. 1996First consignment exports to India. 1997India Focused Integrated Marketing Policy 1998 Introduction of PCM range economy battery for Commercial vehicle segment in the country.

Export to Kuwait & Lebanon 1999Export to Georgia, CIS Country. First India Distributor’s Convention. 2000Opening of India Business Office in Ahmedabad. Launching of VOLTA brand Valve Regulated Lead Acid batteries in Bangladesh 2001Business Award as “Enterprise of the Year” Export to UAE. Opening of Nepal Business Office in Kathmandu. 2003Introduction of Spark Brand battery for economy segment of Domestic market. 2004Introduction of Spark Taxi brand battery for taxi cab segment in the domestic market. Re-start of India export after withdrawal of Anti-dumping duty. 005Introduction of own manufactured Volta Maintenance Free Battery in the domestic market. 2008RGL has been emerged with a view to focus years of experience on export market 2009Globatt was launched in a wonderful ceremony at the fair AUTOMECHANICA, middle-east RGL Factory Inauguration RGL Starts Exporting Milestones of Rahimafrooz into formation of RGL: Present situation Present situation Rahimafrooz Globatt Ltd. is the international concern of Rahimafrooz emerged to manufacture and deliver MF/SMF automotive batteries from its ISO 9001:2008 certified plant located in Ishwardi Export Processing Zone, Bangladesh.

Rahimafrooz is one of the leading business conglomerates from Bangladesh having 56 years experience in battery manufacturing and distribution at home and abroad. RGL (Rahimafrooz Globatt Ltd. ) is built to be a true global venture and to be a leading global automotive battery brand within the coming years. The battery manufacturing plant of RGL is the largest exporting plant in South Asia having 2. 5 million units manufacturing capacity per annum. Rahimafrooz has been exporting batteries to global market since 1992 and customers of 43 countries have so far experienced its products.

RGL sells MF and SMF batteries under brand name GLOBATT. Entire MF/SMF product range of RGL has been designed by one of the world’s leading German Consulting Company. We are determined to create a global brand and position it as one of the top five brands in the global market within next ten years. The strategic intent is to position the brand GLOBATT as a premium brand in the global automotive battery market. The products to be offered under the brand Globatt are ACE, RACE and PACE. ACE is the premium product for 3 year life, RACE is standard product with 2 year life and PACE is a regular category product with 1 year life.

Globatt was launched in a wonderful ceremony at the fair AUTOMECHANICA, middle-east on May 31, 2009. RGL at a Glance: Production Capacity: 2. 5 million units/year Product: Maintenance Free and Sealed Maintenance Free Battery Product Range: Automotive – 32 AH to 200 AH, Inverter – 120 AH to 180 AH, Tractor – 80 AH to 100 AH Standard: JIS and DIN RGL Offers: 1. Wider range of SMF & MF type automotive batteries 2. Technology driven products with superior performance & quality 3. State of the art technology for operational excellence 4. After sales service to enhance customer delight . Promotional Support 6. Competitive Price RGL Theme Think Global – Be Global RGL Marketing Mission: Grow globally with the RGL distributors RGL Marketing Vision: We want to be one of the top 5 leading automotive battery brands in the world & the most preferred supplier to the leading automotive battery distributors around the world by offering market driven solutions & unmatched customer satisfaction RGL Culture ?Living with the Values ?Quality mindset ?Customer Focus RGL Market: 1. China 2. Sri Lanka 3. India 4. Nepal 5. Bhutan 6. Afghanistan 7. Singapore 8. Vietnam . UAE 10. Qatar 11. Lebanon 12. Kuwait 13. Iraq 14. Angola 15. Nigeria 16. Mauritius 17. Tanzania 18. Cambodia 19. Burundi 20. Oman 21. Namibia 22. Jordan RGL SWOT ANALYSIS: Strength: 1. Product design & process 2. Production capacity 3. International marketing experience 4. RSPD support 5. RA image 6. 50+ years of industry knowledge & experiences 7. India operation 8. Initial product acceptances Weakness: 1. Speed to market 2. New production workforce 3. Incomplete product range 4. Execution of the production and sales ramp-up plan 5. Employee retention 6. Product cost . Financial crunch 8. Human resources development 9. Infant brand Opportunity: 1. Market potential in China, Middle East and Africa 2. FTA with India & other countries 3. Selling into Local market 4. High market growth in Asian countries 5. Private brandThreat: 1. Gas & Power crisis 2. Tariff and non-tariff barrier Goals and objectives achieved •Inauguration of RGL in Automechanica, Middle East on May 31, 2009 •First sale of Inverter Battery & Tractor Battery •Developed DIN standard batteries •First shipment to China Market •Price benchmarking for each market Implementation of customer satisfaction measurement process •ISO 9001:2008 Certification •Implementation of SAP (Enterprise Resource Planning Software) •Setup own office in Dubai •Establish QMS (Quality Management System) complied and environmentally sound plant •State of the art technology for operational excellence ? Chapter 02: Management and Human side RGL MANAGEMENT: RGL group: Vacation All permanent employees of RGL enjoy a total of 30 days leave in a year period. This leave is divided in three categories: Sick Leave – 10 days Casual Leave – 10 days Annual Leave – 10 days

In addition to the annual leave mentioned above, extra earned leave can be awarded to the employees depending upon his/her last years leave status. Leaves can be carried forwarded. But total leave can not exceed 40 days. Leave is not encashable. Special Facilities •Pick and Drop transportation facilities for all employees in Head Office and Factory •In factory, employees get free food and accommodation facilities •Regular HR session for measuring employee satisfaction, motivation and complains •Smooth work delegation process •Sales Incentive and Regular bonus scheme •For factory employees, outstation bonus allowance

Training Programme 1. Develop Human Resources through performance management and behavior improvement in line with RA core values by practicing “I + 10 habits” 2. Roll out QC circle & make them effective to ensure people involvement in the decision making process. 3. Enhance the technical knowhow of all the floor technicians by QMS training. 4. Technical Trainings (IT, Microsoft Office) for employees 5. Cross SBUs (Strategic Business Unit) training programmes 6. Competency Training Chapter 03: Production and marketimg Product Product Line-up: ?Automotive ?Globatt Ace ?Globatt Race ?Globatt Pace ?Volta ?Optus Delta ?Ignus ?Inverters ?Globatt Glow ?Volta Inverter ?Tractor Battery ?Globatt Farmer BATTERY DETAILS: Product Features: 1. Ca-Ca Maintenance Free (MF) & Sealed Maintenance Free (SMF) Battery 2. Expanded Metal Technology 3. Use of most expensive ‘Calcium-Silver Alloy’ for Premium range (i. e. GLOBATT ACE) and ‘Calcium-Tin Alloy’ for Standard range (i. e. GLOBATT RACE) 4. Double Chamber battery container with patented condensation mechanism to reduce water loss 5. Built-in ‘Magic eye’ to check the battery health 6. Built-in ‘Flame arrestor’ to prevent battery from outside spark and fire 7. Eco Friendly 8.

High Cranking Performance 9. Heat Sealed Cover 10. Envelop Separator for low electrical resistance 11. Centered Cast-on Strap Plate 12. Optimized Grid Structure 13. Durable & Robust Design 14. Suitable for Tropical Condition 15. Apply to global standard specifications: JIS and DIN BENEFITS OF CALCIUM LEAD GRID TECHNOLOGY: Benefit 1. Distilled Water Supplementation Free As the lead-antimony conventional battery incurs unnecessary local action inside battery due to the effects of antimony ion during battery use and discharges gas by electrolyzing water contained in electrolyte, the amount of electrolyte is decreased rapidly.

The battery performance is deteriorated and operating life reduced unless distilled water is supplemented frequently to compensate for such decrease of electrolyte. Globatt, however, uses specially alloyed calcium-lead, which leads to extremely low level of electrolyte decrease. Hence, if the charging system of vehicle remains error-free until the battery is worn out there is no need to supplement distilled water at all. Benefit 2. Recharging Free Due to the phenomenon of self-discharge, the lead-acid battery is characterized by its charged power being consumed even when the battery is not in use, such as during storage.

The reason behind such phenomenon is that the impurities contained in lead alloy induce local action, causing electric energy to be consumed. Compared with the lead-acid battery, Globatt uses carefully selected, highly refined lead alloy, rendering extremely low rate of self-discharge, and maintaining high performance even during long-term standing. Benefit 3. Overcharge Risk Free The battery mounted on vehicles can always be charged while vehicles are in operation.

In general, the current being charged is adjusted to high or low level by the regulator which controls the size of the voltage. When battery is in the state of near full charge under the condition of voltage already set, the value of current being charged must be decreased to prevent battery from being overcharged to maintain high performance for a long time. As shown on graph, the charging current of Globatt Calcium battery is reduced to extremely low level when the battery is in near full-charge state, eliminating to near zero the danger of battery being overcharged.

Benefit 4. Thermal Runaway Free When battery is in near full-charge state while battery is being used in hot places (temperature approximately 70oC), the current being charged must be decreased to prevent battery damage resulting from overcharging. The charging current level of lead-acid battery decreases at initial stage but rises again soon due to the effects of a few kinds of substance contained in the grid alloy, and the grid is damaged and performance deteriorated due to this thermal phenomenon.

Globatt, however, is free of substance containing such harmful effects, and the current being charged becomes extremely low level when battery is fully charged in high-temperature, leading to the prevention of overcharging. Service Currently RGL giving product services in India and Dubai with their own setup and in other countries through distributors. In India, Rahimafrooz has a separate business unit called RBL, India which in co-operation with RGL gives warranties and after sale services to India customers. In Dubai, Rahimafrooz does that through their Dubai office.

Other countries’ customers get the facilities through distributors where RGL also involved in customer service. In addition, RGL always aware of the customer complains and regular follow-ups the procedures and situation. RGL team never delays in quick visits to the countries where customers need support to some extents. Quality RGL focuses in: 1. Ensure zero defect of 100% delivered batteries from factory based on OCV checking before packing 2. Strengthen receiving inspection of all incoming materials by updating the existing procedure including introduction of sampling plan 3.

Increasing the testing facilities in QA by adding new machine & test of all finished batteries as per JIS/DIN/SAE Standard 4. Cooperate with EMS Cross Functional Team (CFT) for Implementation of ISO 14001:2004 at RGL 5. Introduce statistical process control (SPC) in our QMS manual to standardize ? and ? with objective to review the process in case of deviation. 6. Maintain the QMS for continual improvement and cooperate with QC circle for proper implementation ACTION PLANS for Quality •Standardization of all raw material specification •Enhancement of Monitoring, Measurement and Analysis Application of Statistical Approach in Analysis. •By measuring of OCV before packing at warehouse •Standardization of sampling size. •Establish inspection procedure. •Educate the QA Technician. Conduct various test of all batteries as per JIS/DIN/SAE standard •Any other test as per requirement of Manufacturing/E & T/Marketing. •Increase communication on importance of EMS •Application of Statistical Approach in process Analysis. •Reporting in view of necessary corrective action. •Updating the all types of log sheet and Process Instruction. Marketing Strategy Marketing Vision

We want to be one of the top 5 leading automotive battery brand in the world & the most preferred supplier to the leading automotive battery distributors around the world by offering market driven solutions & unmatched customer satisfaction RGL Business Model Market Expansion Plan Future Plan •Ensure minimum 5% PBT. •Initiate the implementation of CSI in markets with minimum one year experience of RGL products. •Develop a smooth Packaging Material (PM) development, Approval & delivery system. •Brand Registration & Product Certification in ABP targeted markets Pricing Market entry with penetration pricing •Following the Penetrating Pricing Strategy in all markets; minimum 5% below of Korean brands. Benchmarking Chapter 04: Accounting and Finance Accounting & Finance Business Performance 1. RGL exported around BDT35 cr. In first financial year 2. Almost 50% of the exports were in India 3. New corporate agreement with some local and international companies 4. Minimization of costs in the areas of procurement, operation, scraps etc. 5. Re-calculation of the cost of the batteries sold and profit in regard of variable pricing in different global markets.

Financial Statements Sources / Loan, Borrow, Share RGL is a joint venture battery company by Rahimafrooz Batteries Ltd, Global Holdings Ltd. & Brummer & Partners. Al these companies are well reputed in their own arena and market. RGL is financed by Islamic Co-operation for Development (ICD). The board of directors include the representatives of all these ventures who actually are the decision makers of RGL. There are some local sourcing of fund for few operating activities which are resulted from the contract of RGL and some local banks.

The operating activities include the local third party works, worker salaries (Non-management staffs) etc. Major returns come from the payment of exports and advance payments by distributors. New Projects in Hand 1. Going to the Europe market with DIN standard batteries. 2. To become OEM (Original Equipment Manufacturer) of any popular automotive vehicle manufacturer. 3. Human Resources re-structure and develop efficient workforce with proper benefits and motivation. 4. Setting up own offices in China and USA. Distribution of Fund

Fixed Assets: 65%, Operating Cost: 20%, Design & Development: 10%, Promotion: 5% Net Profit and Loss As an infant company established only in 2008, RGL has exported BDT35 cr. In first 7 months of operation in first financial year which has considerably incurred profits. But as per company decision, RGL profit/loss will be calculated including some fixed costs and operating costs which show BDT22 cr. Loss in first year. But this is only the calculation of breakeven projection for complete measure of costs. Financial Measurement of Last 1 year Key Ratios:

Rahimafrooz Globatt Limited DescriptionRatioRemarks GP21. 28%Percent EBITDA13. 69%Percent PBT3. 09%Percent Debtors45. 00Days ROCE21. 39%Percent EPS19. 45Taka APA450. 34Taka Chapter 05: Corporate social responsibility Corporate Social Responsibility Social Welfare rather than own business Rahimafrooz’s aspiration is to to be the most admired and trusted organisation, by excelling in everything it does, following ethical business practices, and adding value to its stakeholders. The Group wants to achieve all of these while being firmly committed to social responsibilities.

Rahimafrooz Group, with a proud history of more than 50 years, strongly believes in the principle of contributing back to the community where it operates. Rahimafrooz strives to add value to the society, its economy, and environment through intelligent efforts and focused initiatives. Rahimafrooz’s CSR vision reads, ” Passionate and driven to make a difference among the Community and Environment. ” Much of the Rahimafrooz CSR efforts are carried out through its social development initiative Rural Service Foundation- (RSF-web address http://rsf-bd. rg/). Currently, Rahimafrooz Group is contributing in the following areas: • Education • Poverty Alleviation • Environment • Transport Apart from this, the Group has always supported many noble initiatives undertaken by various other individuals and organisations. Rahimafrooz has a pioneer role in supporting people distressed by natural calamities and donations to helpless people on health and education ground– all are examples of the socially responsive manner of our business. Rahimafrooz is also a signatory to UN Global Compact.

It supports the ten principles of the Global Compact in respect to human rights, labour rights, the protection of the environment and anti-corruption. Rural Service Foundation (RSF) Rural Service Foundation (RSF) is a not-for-profit social enterprise endeavouring to reduce poverty and support the rural poor. The Foundation operates mostly in rural, disadvantaged communities. It helps rural people to come out of poverty by helping them in generating income for themselves through programs involving solar home systems, improved cooking stoves, bio gas, contract farming etc.

Additionally, RSF also runs “Dhaka Project” which is home to some 500 urban underprivileged children, providing them with shelter, education, food, clothing, and care. RSF has a nation-wide network with nearly four hundred field offices. The Dhaka Project: The Dhaka Project is a not-for-profit project run by Rural Services Foundation (RSF) – where a family of 500 underprivileged children are provided with free basic education, balanced nutritious food for physical development, and medical support and service for a healthy living. The project was initiated by Maria Conceicao.

The mission of the project is to contribute to making lifetime transition from extreme poverty towards a complete and rewarding life, focusing on the children. How the Dhaka Project works: EDUCATION Daycare: This class basically takes care of infants (6 months to 2 years of age) from impoverished families and provides them with attentive care and balanced food. The parents or siblings of these infants are often part of other Dhaka Project programs. Playgroup: This class introduces the children (3 to 4 years of age) to the alphabets. The children are provided with balanced food.

Nursery: This class prepares the students (4 to 6 years of age) to cope with the school standard. TDP School: The students get the taste of real school over here. The school follows the National Curriculum in English Medium and tries its best to keep up with the rest of the world. MEDICATION The Dhaka Project proudly presents its medical department where many children lives were saved. All the children receive first class medical facilities. Routine checkups are done including dental medication, vaccination & primary medical treatment. For any critical treatment relevant hospitals are referred.

SEWING SECTION Sewing Section provides versatile opportunities. Firstly it adds an extra income for The Dhaka Project’s children and secondly it ensures employment for their parents. RSF Model School & College In 2008, Rural Services Foundation (RSF) setup a free of cost, residential education centre in Shajahanpur, Bogra for children from severely impoverished families living in the Monga affected areas. In two years, RSF Model School & College has become the home of 80 such students. The objective is to create long-term impacts in the lives of these students through structured quality education.

The students receive education under the National Curriculum in English. They also regularly participate in sports activities, moral studies, and recreational activities. The school, under the guidance of its Principal, teachers & support staff has created a disciplined and nurturing environment for the development of these children. Through inclusion of 40 children every year from families under the program, “Palli Karma Sahayak Foundation” (PKSF), RSF Model School & College strives to expand in many areas of Bangladesh in near future. RSF IT Centre Dishari”, an IT education CSR project was taken over by Rural Services Foundation of Rahimafrooz in 2007. RSF is now providing affordable IT education to the communities through its centres in Jhenaidah, Cox’s Bazar, Chandpur, Satkhira and Narshingdi. Make Road Safer The Campaign for Safer Roads, “Make Roads Safer” was launched in March 2008 during the Lucas Dhaka Motor Show 2008. It focuses on driver safety, passenger safety, road and pedestrian safety, and most importantly, the training of the road-safety professionals. This also supports various rograms to improve road safety in Bangladesh. Poribesh Utshab For the third consecutive year, Rahimafrooz celebrated the International Environment Day with “RSF Poribesh Utshab 2010”. This year, Rural Services Foundation (RSF) – a Social Development Initiative of Rahimafrooz, organised quiz competition covering 30 upazillas of Bangladesh and gave awards to 450 students. The quiz competition is aimed for candidates of SSC examination and the topics include climate change, renewable energy technology and 3R (Reduce, Reuse and Recycle) issues.

In our effort to promote greater environmental responsibility, Rahimafrooz will continue arranging the program every year with the aim to encourage the students to increase their knowledge on environment as well as to make them conscious about the climate change. 3R (Reduce, Reuse, Recycle) Rahimafrooz believes in promoting individual environmental responsibility through commitment to 3R (Reduce, Reuse, Recycle) – a globally recognised concept and practice to address Environmental Issues.

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