Internship Report

on

Industry Analysis
Supply Chain Management
of
“Lafarge Surma cement Ltd.”
Prepared by:

Md. Shaijuddin Jewel

ID: 11304008
Student, BRAC Business School
Prepared for:

Suntu Kumar Ghosh

Assistant Professor,
BRAC Business School

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 Letter of Transmittal
31th August, 2015

Suntu Kumar Ghosh

Assistant Professor

BBS Department

BRAC University

Subject: Submission of Internship Report on Industry Analysis and Supply Chain

Management of Lafarge Surma Cement Ltd.

Dear Sir,

It is my pleasure to submit my Internship Report that fulfills partial requirement of my Bachelor

of Business Administration (B.B.A.) degree. It has been extremely helpful as a student of BBS
Department to undergo the Internship Program. It facilitated my exposure to the Industry analysis
and Supply Chain Management of Lafarge Surma Cement Ltd. I could relate well the theoretical
knowledge to the real world situation.

In preparing this report I’ve tried my best to follow the guidelines provided to me by academic
supervisor. I have my sincere efforts to make it an informative and analytical study while
preparing this report. I sincerely hope this report will live up to your expectations.

I would be happy to answer any query regarding this report and end up with a good grade.

Sincerely Yours,

…………………………………….

Md. Shaijuddin Jewel

11304008

BRAC University

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 Acknowledgement

The theoretical knowledge that is gathered from the Educational institution is not sufficient to
aware the subject matter rather the practical knowledge. In order to resolve the dichotomy
between these two areas, I was assigned to prepare a report on " Industry Analysis and Supply
chain Management of Lafarge Surma Cement Ltd.".

I, Md. Shaijuddin Jewel, First of all, would like to express my gratitude to almighty Allah
for keeping me mentally and physically sound to prepare this report. Again, I would also like
to express my heartiest gratitude & thanks to those people, because without their dedication
and contribution this project would not have been possible and would not get the successful
compellation.

I would like to take the opportunity to express my gratitude to my internship advisor, Suntu
Kumar Ghosh, Assistant Professor, BBS Department, BRAC University for his valuable
suggestion, without his supervision that would have been extremely difficult to accomplish.

In the head office of Lafarge Surma Cement Ltd some people continuously assisted to learn
numerous aspects of Supply Chain. Among those people, I want to thank to Md. Mazharul
Huda Lizan, Executive Logistics; who was my organization supervisor. During last three
months, he taught me every logistics work to the point and assigned me in different activities.

In Addition I am also thankful to Mohammad Abul Hasan, Md. Monirul Islam and Md.
Abdullah Al Mamun Tuhin. They all helped me a lot from time to time and guided me in the
right direction.

Finally, I humbly appreciate the endurance & assistance of the entire individuals at Lafarge
Surma Cement Ltd who spent their time in making me able to complete my Internship
Report.

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 Abbreviations

∑ LSC- Lafarge Surma Cement Ltd.

∑ HR- Human Recourse
∑ LUMPL- Lafarge Umium Mining Pvt. Ltd.
∑ JDE- Specialized Software uses to automated business
∑ SCM- Supply Chain management
∑ TFM- transportation and Freight management
∑ TMS- Transportation and Management System
∑ TM- Transport Module
∑ EDI- Electronic Data Interchange
∑ KPI- Key Performance Indicator
∑ BIWTA- Bangladesh Inland Water Transport Authority
∑ DN- Delivery Note
∑ DOA- Diligence of Authority
∑ GRN- Goods Received Note
∑ S&OP- Sales and Operational Planning
∑ OP- Order Process

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Table of Contents
1.Executive Summary............................................................................................................................. 6
2.Introduction......................................................................................................................................... 7
3. Company overview………………………………………………………………………………………………………………..10

4. SWOT analysis…………………………………………………………………………………………………………………………15

5. Porters five forces……………………………………………………………………………………………………………………16

6. Departments of LSC…………………………………………………………………………………………………………………19

7. Pricing of LSC……………………………………………………………………………………………………………………………24

8. Logistics management team…………………………………………………………………………………………………….29

9. Production Process………………………………………………………………………………………………………………….30

10. Supply Chain Management…………………………………………………………………………………………………….32

11. Corporate Social Responsibilities……………………………………………………………………………………………47

12. Job Responsibilities……………………………………………………………………………………………………………….50

13. Project Work………………………………………………………………………………………………………………………….51

14. Observation…………………………………………………………………………………………………………………………..55

15. Recommendation………………………………………………………………………………………………………………….56

16. Learning………………………………………………………………………………………………………………………………..57

17. References…………………………………………………………………………………………………………………………….58

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 Executive Summary

Bangladesh Cement Industry currently holds an installed capacity of 33-35 Mn MT, while it
can supply 25-27 Mn MT cement, efficiently. However, the demand is at lower-end, hovering
around 18-20 Mn MT. As a result, the industry possessed with overcapacity. Despite
industry-wide overcapacity, per capita cement consumption is still very low, with 107 KG in
Bangladesh, in comparison to its regional peers, like 210 KG in India, 265 KG in Pakistan,
310 KG in Sri Lanka and 570 KG in Korea. Backed by ongoing and upcoming infrastructure
development activities, we do expect and believe that, demand may flourish and spike up
cement consumption, in the days ahead. Hence, industry leaders with exceptionally higher
installed capacity may see higher capacity utilization rates, merging to industry average
utilization rate of 60-65%. The good news is that, for the last several years, 100% demand for
cement has been filled up locally. Notably, some companies have also been exporting cement
to India, while some others are expecting to export cement in Nepal and Myanmar. (IDLC
Finance Limited, 2015)

Supply Chain Management means stream of merchandise from the assembling association to
end client through distinctive mediums. In this report different elements of Supply Chain
Management are extravagantly examined. The real capacities are: Transportation
Management, Distribution Management, Inventory Management, Cost Management,
Payment Management, Supplier Management, and Customer Service Management.

Alongside the hypothetical parts of these capacities, this report additionally gives a
framework how "Lafarge Surma Cement" works its Supply Chain of Cement. This
association has the main completely coordinated cement plant in Chhatak, Sylhet; while its
head office arranged in Dhaka. LSC has six terminals in better places of Bangladesh which
bolster its conveyance system.

In this report, the obligations of mine in different regions of LSC head office are depicted
here. I have worked in three departments. For the most part I included in Logistics
department, and incompletely I worked in Human Resource Management and Corporate
Social Responsibility.

At last, from my experience of three months entry level position I have watched some
missing of LSC. I attempted to give suitable suggestions to the change of Lafarge Surma
Cement Ltd.

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Introduction
Background
Bangladesh cement industry is the 40th largest market in the world. Currently capacity of the
industry is about 20 million ton (MT). Top 13 players are alone controlling over 78% of the
total industry capacity. However, the balance capacity still remains quite fragmented. (Zebun
Nahar, 2011)
Development of cement industry in Bangladesh dates back to the early-fifties but its growth
in real sense started only about a decade. The country has been experiencing an upsurge in
cement consumption for the last five years.
Government gave permission for establishing cement industries in Bangladesh in FY1995.
Initially the cement industry took place without the proper analysis of the demand and supply
of cement in the country. Within the span of the two to three years, industry attained
expanded capacity of the product with stable growth rate of consumption.
There were mainly four dominant players in the cement industry in the year 1998 that
produced their own cement to meet the demand of their customers. These companies were:

v Meghna Cement (owned by Bashundhara group)

v Eastern Cement (currently known as Seven Horse)

v Chatok Cement

v Chittagong Cement (taken over by Heidelberg)

After a decade, currently 123 companies are listed as cement manufacturers in the country.
Among them 63 have actual production capacity while 32 are in operation. The current
installed capacity of the industry is 20.0 mn MT.
Lafarge Surma Cement Limited started its operation in 11th November 1997 as a private
limited company according to Company Act 1994. Later on, it went to public on 20th
November 2003. It is the joint venture of Lafarge and Cementos Molins, Spanish company
with strong global presence in building materials. LSC has more than 24000 shareholders and
listed in Dhaka and Chittagong Stock Exchange.

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Origin of the Report
This report is prepared as a mandatory requirement of the internship program for course BUS
400 under the BBA program at the Department of BRAC Business School (BBS), BRAC
University. The organization which this report represents is Lafarge Surma Cement Ltd. The
internship program at Lafarge Surma Cement Ltd. started from June 23, 2015, and the
attachment period with the organization ends on 23 September 2015. The preparation of the
report was done under the supervision of Professor Suntu Kumar Ghosh.

Objectives

Broad Objective
To analyze the existing cement industry in terms of Supply Chain Management System at
Logistics unit of Lafarge Surma Cement Ltd.

Specific Objectives

The specific objectives of this report are:

• To have a practical experience of Job life.

• To find out the relevance and application of the theoretical knowledge in practical life.

• To know about the real life scenarios and problems that occurs in a workplace which
however cannot be understood properly by reading books and studying in classrooms.

• To gain an in-depth knowledge about how a company (in this case a cement company)
functions by utilizing its resources properly.

• To gain knowledge about the cement industry of Bangladesh.

Scope
This report is intended to be a detailed examination of the activities that take place in logistics
department of LSC and will analyze the details of bills and procurement system of the
company as well as the overall operational efficiency. The analysis is based on information
till August 16, 2015. Any other development of logistics thereafter is thus out of the scope of
this report.

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Rationale
The Internship report has been prepared as a part of fulfillment of BBA. This report “Industry
Analysis and Supply Chain Management of Lafarge Surma Cement Ltd.” was prepared to
analyze the existing industry and the supply chain management system of Lafarge Surma
Cement.

This report can be useful to the employees of logistics team and other teams dependent on
logistics administration and the management committee and help them make informed
decisions. Moreover, other players of this industry can compare their operations as well and
strategize accordingly.

Limitation
I have been an intern at Lafarge Surma Cement for around 11 weeks and gathering all the
necessary information within those eleven weeks was quite difficult on both my part and my
supervisor’s part. Moreover in order to abide by the policy of Data Security of Lafarge Surma
Cement Ltd, certain information could not be reproduced in preparing this report, also
accessing information relevant to my report was not encouraged either.

Methodology
To have the initial objectives accomplished, both primary and secondary data was used.

The organizational overview information was derived from various sources including the
annual reports of Citigroup, Citigroup website, the Financial Statements of Citibank NA.,
Bangladesh etc.

For the procedural and analysis section information was gathered through interview of the
employees working in the Logistics Unit, extraction of relevant data from original sources
and from policy guidelines.

In case of making a comparison with competitors, the websites of such competitors, publicly
available annual reports and interviews have been taken as the major sources of information.

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Company Overview
History of Lafarge
Joseph-Auguste Pavin de Lafarge founded the company Lafarge in 1833in the city of Le Teil
in France with the product of limestone. Gradually the company expanded and acquired its
first cement plant in 1987. Now it is operating its business in 62 countries along with
Bangladesh. Cement, construction aggregates, asphalt and concrete are main products of
Lafarge. Country wise these products vary. “Anticipate needs to drive advances in
construction methods” is the mission of Lafarge Group. “Respect, Care and Rigor” are
the solid values of Lafarge. The employees of Lafarge throughout the world also believe in
integrity, ethics, courage, empathy, openness, commitment, performance, value creation,
respect for employees and local cultures, environmental protection, conservation of natural
resources and energy. The Group portfolio of businesses is as follows:

∑ Cement: 63.5%,

∑ Aggregates and concrete: 35.9%,

∑ Other: 0.6%.
At present Bruno Lafont is the Chief Executive Officer of Lafarge group. From the record of
2013, Lafarge has 64000 employees throughout the globe. In 2013, its sales were 15.2 billion
Euros. It has 1636 production sites in different countries. Lafarge head office is now in Paris,
France. Lafarge built the first research center for building materials where the employees are
trying to develop their products without hampering the environment.
Cementos Molins, Sociedad Anonima, is a Spanish Cement Company which was founded in
1928. With the experience of 75 years in manufacturing cement Cementos Molins has now
become a renowned Concrete, Aggregates, Mortar and Pre-cast product producer in Spain. It
has now 40 Ready Mix plants, 13 Aggregates quarry and 11 pre-cast product manufacturing
units in Spain, it has industrial operation in Mexico, Argentina, Uruguay, Bangladesh and
Tunisia.

Lafarge and Cementos went for a joint venture agreement. By this joint venture two
companies formed named Surma Holdings with Lafarge and Molins. Each company holds
50% stake in the newly formed joint venture company. However, after transfer of the current

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Lafarge shareholding in Lafarge Surma Cement (LSC), the Joint Venture Company holds
about 59% of LSC's common equity.

Lafarge Surma Cement Ltd. was established in 11th November, 1997. This commercial
venture was born by an investment of 280USD dollars which was financed by Lafarge of
France and Cementos Molins of Spain. However, till now it is the biggest foreign investment
in our country.

Since Bangladesh has no commercial deposit of limestone, that’s why in 2000 India and
Bangladesh signed a historical agreement through exchange of letter to support this unique
cross boarder commercial venture. According to this agreement, India would provide
uninterrupted supply of limestone to the plant which was established in Chattak, Sylhet,
Bangladesh.

Although the main plant is in Bangladesh; a subsidiary office named Lafarge Umiam Mining
Private Ltd. (LUMPL) being registered in India, which operates its quarry at Nongtrai in
Meghalaya.

Background of Lafarge Surma Cement

As it is mentioned earlier that LSC was incorporated on 11th November 1997 as a private
limited company in Bangladesh under the Companies Act 1994. Subsequently, on 20th
January 2003, Lafarge Surma Cement was made into a public limited company. The
Company is listed in Dhaka and Chittagong Stock Exchanges and has more than 24,000
shareholders. The plant of Lafarge Surma Cement, which is located in Chhatak Sunamganj is
the only fully integrated dry process cement plant in Bangladesh where high premium quality
clinker (a semi finished product needed to produce cement) and cement are produced
utilizing sophisticated and state-of-the-art machineries and processes. The Company’s ability
to produce its own clinker under its strict quality supervision and the presence of an
international standard Quality Control and Monitoring Lab ensures the same consistent
premium quality in each and every bag. Lafarge Surma Cement sources its primary raw
material limestone from its own quarry in Meghalaya, India, which has one of the best quality
limestone deposits in the world. This limestone is brought to the Plant using a 17 km long
conveyer belt. In November 2000, the two Governments of India and Bangladesh signed a

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historic agreement through exchange of letters in order to support this unique cross border
commercial venture, and till date it is the only cross border industrial venture between the
two countries. As Bangladesh does not have any commercial deposit of limestone (the main
raw materials for producing clinker), the agreement provides for uninterrupted supply of
limestone to the cement plant from the quarry. Lafarge Surma Cement Ltd. wholly owns a
subsidiary company Lafarge Umiam Mining Private Ltd. (LUMPL), which is registered in
India and operates the quarry in Meghalaya.
By supplying clinker to other cement producers in the market and through import substitution
of clinker, Lafarge Surma Cement helps the country save USD 65-70 million worth of
foreign currency per year. The Company also contributes around BDT 1 (one) billion per
annum as government revenue to the national exchequer of Bangladesh. About 5,000 people
depend on our business directly or indirectly for their livelihood. Apart from these, the
Company also contributes to the sustainable development of the society, economy and
environment though its Corporate Social Responsibility initiatives in the area of education,
health, employment generation, infrastructure development and environmental management.

This commercial venture, with an investment of USD 280 million is one of the largest foreign
investments in Bangladesh. It has been financed by Lafarge, S.A., Cementos Molins, S.A.,
and a number of leading Bangladeshi business houses together with International Finance
Corporation (IFC), The World Bank, the Asian Development Bank (ADB), German
Development Bank (DEG), European Investment Bank (EIB) and the Netherlands
Development Finance Company (FMO). Lafarge is a world leader in building materials,
employing 64,000 people in 62 countries. As a top-ranking player in its Cement, Aggregates
and Concrete businesses, it contributes to the construction of cities around the world, through
its innovative solutions providing them with more housing and making them more compact,
more durable, more beautiful, and better connected. With the world’s leading building
materials research facility, Lafarge places innovation at the heart of its priorities in order to
contribute to more sustainable construction and to better serve architectural creativity.
Cementos Molins is a family owned Spanish Company with more than 80 years of
experience. Apart from its operation in Spain, it has operations in Bangladesh, Argentina,
Uruguay, Mexico, and Tunisia, controlling 16 million tons of cement. Lafarge Surma Cement
will continue to strive to come up with range of products and solutions that will convert
architectural dreams into realities and provide the building blocks for a modern and beautiful
country. Lafarge Surma Cement Limited started its operation in 11th November 1997 as a

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private limited company according to Company Act 1994. Later on, it went to public on 20th
November 2003. It is the joint venture of Lafarge and Cementos Molins, Spanish company
with strong global presence in building materials. LSC has more than 24000 shareholders and
listed in Dhaka and Chittagong Stock Exchange.

Vision

- To be the undisputed leader in building materials in Bangladesh through

- Excellence in all areas of operations with world class standards

- Harnessing the strengths as the only cement producer in Bangladesh and

- Sustainable growth that respects the environment and the community

Commitment

- Offering highest quality of product and services that exceed the customers expectation

- Giving the people an enabling environment that nurtures their talents and opportunity
to give the best for the organization

- Contribute to building a better world for the communities

- Delivering the value creation that the shareholders expect (Annual Report 2014, 2014)

Products

SUPERCRETE

Supercrete is a premium cement brand made for multi-purpose applications, namely -

foundation, beam, column, slab masonry, plastering works, etc. This cement is purely
limestone based, free of fly ash or slag, unlike other cements in the country.

Unique features of Supercrete are:

- Consistent Quality

- Early Strengths and Setting

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 - Good Workability

- Superior Finish

- Light Color

POWERCRETE

Innovative formulation from Lafarge Cement’s unequalled technical resources has produced
cement that is the effective solution to the productivity demands of large construction
projects. Unique particles size and extra fitness reduces voids in concrete which protects the
concrete from water contact. Powercrete is available in bulk quantity for big construction
projects.

Powercrete has the characteristics of:

- Excellent strength performance at all ages

- Good early strength

- Superior workability

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SWOT Analysis

Strength Opportunity

Threats Weakness

Strength :

Weakness:
nsport vehicle.

Opportunity:

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Threat:

Porter’s five forces

Threat of new entrants ---------------- Low

difficult to get power connection.

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 capacity utilizations are
below 60%.

channel.

Bargaining power of buyers ---------------- High

consumer of cements; enjoys monopoly power to select

the cement companies.

would
curtail the buyers’ power.

Rivalry among existing competitors---------------- Medium

growing at a pace of more than 20%, all players have the scope for higher capacity
utilization. But smaller local companies are prone to consolidation with large company to
attain production efficiency. In an oligopoly structure, rivalry would get intensified in near
future.

players are revamping the distribution capacity to reach everywhere.

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out of 54 cement companies are in operation

Bargaining power of suppliers ---------------- High

Indonesia and China and is therefore susceptible to rising global

riencing heavy infrastructure growth in their own country

and will not be affected if they do not supply raw materials to Bangladeshi companies.

Threat of substitution ---------------- Low

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 Organizational Structure of Lafarge Surma Cement Ltd

Board of
Directors

CEO

Finance Supply Chain Marketing Operations Director, Strategy

Sales Director Legal Director
Director Director Director Director LUMPL Director

Departments of LSC

Information Technology Department

The fundamental capacity of this division is to give sound IT backings to the whole
organization. It is likewise in charge of overseeing and exchanging information among the
concerned powers of LSC. The head of IT alongside his group dependably attempt to give the
representatives better support. It is a critical division.

Finance and Accounts Departments

The Finance and the Accounts Department of LSC is interlinked. This office is primarily in
charge of keeping and checking on the financial records and to transform the reports which
include the monetary exchanges of the organization. All the monetary reports and budgetary

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diary sections of LSC are readied by the Finance and Accounts office. These offices
additionally guarantee the upkeep of the records for the organization. The yearly spending
plan distributed to different branch workplaces are checked by the Finance and Accounts
group. If there should arise an occurrence of any budgetary intricacies to be determined sheet
or yearly reviewing, the office assumes the key part in fulfilling that. Checking bills, doing
installments and repayments are their key assignments

HR Departments

This department is responsible for recruiting potential candidates, training them, making a
succession planning and developing their talent.

∑ Recruitment process

To select a worker, the organization first gives the promotion of the empty position inside.
Intrigued hopefuls from the association are permitted to apply for these positions. The
representative would then need to confront a meeting. On the off, chance that he passes the
meeting then the hopeful would need to take consent from his area of expertise head so as to
switch his specialty or to move to another position. The second alternative is that the interior
referrals are utilized where the representatives of LSC alludes to an applicant who may be
qualified for the empty position of the organization. Last however not the minimum,
opportunity notices are given in both the neighborhood news papers and the online business
catalog of Bangladesh.

∑ Training and development

The preparation and advancement is essentially upheld by the logistics and promoting office.
There are different sorts of preparing projects which are accommodated the representatives in
LSC. The representatives who are working in the Commercial building in Dhaka are given
additionally preparing which is of a more refined nature. This primarily alludes to doing so as
to prepare where the worker essentially learns and by working with their chief. Then again,
other concerned laborers of the organization, for example, the professionals, bricklayers,
engineers, assembly line laborers and the merchants are prepared throughout the year.
Different sorts of at work instructional meetings alongside gatherings and classes are
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organized them with help and backing from the promoting and the logistics division of the
organization.

∑ Succession planning and talent development

The administration of the association takes a gander at the track records of the representatives
in the progression arranging project. The reputation for the most part comprises of data
identified with the execution of a worker. This reputation is likewise made by the HR
division of the organization. According to the consequences of the reputation, the lacks of the
workers are recognized and obliged steps are taken by the HR staff to help that representative
further evaluate and build up his abilities.

Marketing Department

Creation of market
The market is created by:

1) Providing advertisement.
2) Providing agent ship.
3) Giving dealership.
4) And also through the wholesalers and retailers of the product.

Determination of market demand and supply

Market demand and supply of the product is determined by: i) surveying. ii) Gathering
monthly report. iii) Collecting the opinion of consumers. iv) Collecting the competitors’
views and opinions. v) Collecting data and information from market researchers and
specialists.

Meeting market demand and achieving target market

The company is able to meet its market demand. And it is capable to achieve the
target market.

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Best technique for creating market

The best technique for creating market is mainly agent ship.

Main approach on marketing

The chief approach on marketing is to satisfy the consumers.

Research and development (R&D) program:

The types of techniques for R& D are:

i) Market survey for marketing product.

ii) Making discussion with the agent.
iii) Ensuring product quality and gathering report.

The marketing department of LSC follows each and every aspect which is mentioned to gain
the best out of the market and from the customers as well. During Ramadan month they
arranged several Iftar party to be in touch with their loyal and potential customers.

Sales Administration

The sales administration department of Lafarge Surma Cement Ltd works with the pricing
procedure of it\s product. Pricing Procedure describes the “Price Management” of Lafarge
Surma Cement Ltd. (“LSC”), which includes selling rebate to accommodate relevant
changes. It sets internal control in the price and rebates changing management.

The Process
The entire process works in fifteen different steps in total. These fifteen steps are done under
six different segments. These are:

- Customer & Sales Manager

- Customer Master Administration

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 - Sales Admin
- Treasury
- Depot Logistics
- Input Output Process

The process begins Customer and Sales Manager segment. The first step is to receive request
from customer. From here the received request moves to the Customer Master Administrator
segment. There a decision is taken whether to update the customer or not. If yes then it moves
to the Customer Master File Administration section under Input Output Process segment.
From there it moves to Prepayment. In customer is not updated, it moves it directly to
prepayment. From there if prepayment is to be made then it moves to Enter Prepayment
section and then to Enter Sales Order function. If prepayment is not going to be made then it
moves directly to Enter Sales Order function. This is the third step of the process. From
prepayment onwards the functions are being operated under Sales Admin segment.

From here it moves to the fourth step which is Automatic Credit Card. The automatic credit
card sends the order to Sales Order on Hold section where a decision is to be made. If yes
then it moves to the fifth step which is Review Credit Limit & Customer Account. It moves
forward from here to the sixth step which requires knowing if the problem is resolved. If no,
then a decision has to be made whether to notify the customer or not. If no then sales admin
closes the sales order which is the seventh step.

If the customer is notified then the customer pays and the order moves to the eighth step
which is Release Sales Order on Hold. If the problem is resolved in step six then the order
directly moves to the eighth step. Steps two, five, six and eight are performed under the
treasury segment.

After the releasing of the sales order hold it moves to step nine which is Print Sales Order.
This is an optional step. After printing it moves to WDS Process under Depot Logistics
segment. Under the shipment process there are four steps starting with Check Documentation.
After that stock availability is checked and the approval for loading is issued. After loading
process completes comes the step of document processing which is the thirteenth step. After
this the order moves to VAT register update ad maintain step. The entire shipment process is
done under the Depot Logistics segment. Upon completion of the shipment process the order
moves to its fifteenth and final step which is Reconciliation WDS vs JDE vs VAT. This step
is performed under the Input Output Process segment.

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 Pricing of Lafarge Surma Cement Ltd

The pricing of cement of various players in the industry are very close to one another. Due to
the presence of homogeneous products in the market, price war is a sensitive issue in this
industry which exists from time to time in the cement market. Cement prices have been on an
upward trajectory since 2007 in line with steady increase in clinker costs. However, the large
capacity expansions are expected to weigh down on price realizations by cement companies
due to increasing availability of product.
Moreover, cement prices, like all commodity prices, are influenced by demand-supply
dynamics. Seasonal factors like weak demand during monsoon in most areas also put
pressure on prices. As the freight cost accounts for a substantial proportion of sales price, the
ruling market price of cement becomes different in different regions.
Additional capacity utilization of the existing units as well as commissioning of new
producing units is likely to bring down the sales price, unless there is an equivalent rise in
demand. But if the demand does not rise proportionately to absorb the additional supply, the
units would have to lower price to induce more sale to maintain the required level of revenue
income. The quality of cement, brand image, export potential, price of cement in international
market, anti- dumping position of cement manufacturer, future tariff policy etc. will have an
impact on price of cement in future.
The factories which would be using captive power, which is cheaper and more reliable than
grid power and backed by uninterrupted clinker supply at competitive price, are likely to be
more cost efficient to emerge as the market leader.
Hence, average price of cement is expected to increase by BDT 5.0 - BDT 10.0 per bag over
the next 3 years. Price may not increase in line with increasing demand as the cost of sales
may dip due to stable clinker price and increasing supply of product.

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Zone-wise Retail Price Comparison

Central Zone
In central zone, during the past year, Supercrete does not lead the market. Retail prices
ranged between BDT 435~485 per bag. (Monthly Commercial Report Jan' 15, 2015)

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North-East Zone
In north-east zone, during the past year, Supercrete leads the market. Retail prices ranged
between BDT 415~430 per bag.

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Factors Influencing Pricing Strategy at LFC

Price reflects the revenue generated for product. Here price means invoicing price for cement
& clinker by the customers and distributors. Cement prices, like all commodity prices, are
influenced by demand-supply dynamics. Seasonal factors like weak demand during monsoon
in most areas also put pressure on prices. As the freight cost accounts for a substantial
proportion of sales price, the ruling market price of cement becomes different in different
regions.
Additional capacity utilization of the existing units as well as commissioning of new
producing units is likely to bring down the sales price, unless there is an equivalent rise in
demand. But if the demand does not rise proportionately to absorb the additional supply, the
units would have to lower price to induce more sale to maintain the required level of revenue
income. The quality of cement, brand image, export potential, price of cement in international
market, anti- dumping position of cement manufacturer, future tariff policy etc. will have an
impact on price of cement in future.

Factors
There are certain factors that directly have an impact on the pricing strategy at Lafarge Surma
Cement LTD. These are as follows:

- Price dynamics change in the market. This can be caused by fluctuation in costs
like electricity cost, fuel cost, distribution cost elements etc. For example, if suddenly
the fuel cost goes high by a large margin then the price of the product will also move
upwards.
- Seasonality impact. Seasonality means a characteristic of a time series in which the
data experiences regular and predictable changes which recur every calendar year.
Any predictable change or pattern in a time series that recurs or repeats over a one-
year period can be said to be seasonal. These seasonality changes causes cement price
to fluctuate.
- Special offer. During special offers special prices are introduced to go with the offer.
- Achievements for volume target. If a volume target is achieved then in some
instances reduced prices are offered for a certain time period to the achiever.
- Strategic market decision. Sometimes strategic marketing decisions are taken which

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 affect the price of the product.
- Change of imported clinker price. Lafarge imports clinkers for production. If the
clinker price moves upwards or downwards then the price of cement moves along
with it.
- Non trade customer. For non trade channel customer, price may change based on
negotiation with customers, customer’s purchase order, MOU, business agreements
with the customer and special project based competitive offer etc.
- Modes of transportation change/lifting location. If a customer’s mode of
transportation changes then often it causes the price of the product to change as well.
This happens because different vehicles cost different amount of money to deliver
product. Similarly if the location of lifting is changed that also affects the price of the
product.
- Freight cost elements change. Another reason for price of the product to change is if
the freight cost elements change. These affect the price of the product directly.
- Need to be price competitive in the market. Sometimes to price competitive in the
market the price of the product needs to be marked down. For instance if all the
competitors are selling their product at a significantly cheaper price than sales of
products from LSC will automatically go down. So to be competitive in the market
the price needs to be marked down. (Nasif Kabir Siqqique, 2014)

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Logistics management team

Head of
Logistics and
Planning
Assistant
Head of Manager
Purchasing Industrial
Ecology

Supply
Chain
Director

LSC plant

LSC plant is arranged in Chhatak, Sylhet, close to the fringe of India. It is the main
coordinated cement plant in Bangladesh with 17 km long transport line by which limestone
originates from Meghalaya LUMPL quarry. 10 km of this transport line arranged in
Bangladesh and 7 km situated in India. The LSC plant is a condition of workmanship and the
main completely incorporated dry procedure cement plant in Bangladesh where clinker and
concrete of high premium quality are delivered. The global standard Quality Control and
Monitoring Lab guarantees that each sack that left the plant conveys the same predictable
premium quality the distance.

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 Production Process

The different stages of Cement production is described here:

Major raw materials: limestone, clay, iron & sand.

v In the LUMPL quarry the limestone is collided with 3 stages and sent to Bangladesh
plant through the transport line. Mud, Iron and Sand are gathered by regional
standards from better places.

v At the beginning stage of Lafarge plant in Bangladesh, the limestone slammed again
and changed over into fine particles.

v This fine limestone is blended with prepared iron, dirt and sand, and after that warmed
into furnace by 1400 to 1600 degree centigrade temperature. At this high temperature,
calcium carbonate, silica, alumina, and iron metal artificially responded and produce
clinker which contains water driven calcium silicates, is the fundamental segment of
cement.

v At first clinker states in semi fine particles, and afterward they are set in the cooler
where these get to be harder and framed a greater shape. At that point these are
molded close just as in another machine.

v In the furnace the clinker is cooled and put away for delivering concrete, when
fundamental, these are sent to cement storehouse for last generation. LSC offer
clinker specifically also.

v For Producing SUPERCRETE, 65-79% Clinker, 21-35% Limestone and 0-5%

Gypsum are combined and crushed.

v For creating POWERCRETE, 65-79% Clinker, Slag-Fly fiery remains Limestone 21-
35% and 0-5% Gypsum are combined and crushed.

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 v In the Chhatak plant just SUPERCRETE is created, POWERCRETE is delivered in
other concrete plant's setup where administration keeps running by Lafarge.

Packaging

The packaging of LSC is likewise done in a computerized way. LSC hosts contract with third
gatherings that produce cement sacks as indicated by prerequisites. Every pack weights 50 kg
and concrete is filled naturally more than 50kg, so that after spillage the amount does not
diminish less than 50kg. Bundled and fixed concrete packs are sent through carpet lift to the
canal boat and truck loader. There are 2 flatboat loaders and 1 truck loaders in the plant.

Supply Chain and Logistics

Strong logistics ensures on-time delivery and distribution everywhere. The logistics team in
plant maintains coordination with Packing, Production and Head Office fleet team.

When Sales Order set in Head Office, armada group oversees freight boat, truck and
transporters and send points of interest of transporter to the Plant Logistics Team through
JDE framework.

The vehicle came to the plant and it is given a card where the majority of its data (ID,
transporter, destination, cargo rate and so forth.) are embedded.

Empty trucks weighted first and after that cement sacks are stacked with the
assistance of programmed loader.

Two works stack those packs in the truck and do a manual meaning cross check.

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 Barges are likewise stacked in a programmed path for cement and clinker.

Supply Chain Management

In definition, Supply Chain management defines the flow of goods, movement and storage of
raw materials, placing finished goods from production place to customers through
interconnected and interlinked networks of channels and businesses. “Keith Oliver”, a
consultant at Booz Allen Hamilton (Booz and Company) brought the word “Supply Chain
Management” in business world through his interview for Financial Times in 1982.
Gradually, the word spreads to different organizations and became popular in mid 1990s.
Major areas of SCM are operation management, logistics, procurement, information
technologies, product development, sourcing and production. According to Robert Handfield,
Ph.D. (2011), “Supply chain activities cover everything from product development, sourcing,
production, and logistics, as well as the information systems needed to coordinate these
activities.

The general process of SCM follows, design planning, execution, control and monitoring to
maximize customer value and achieve a sustainable competitive advantage. Through SCM
organizations gain various objectives, like creating net value, building a competitive
infrastructure, leveraging worldwide logistics synchronizing supply with demand, measuring
performance globally, calculating supply chain transactions, managing supplier relationships,
and controlling associated business processes.

A definition is given by Hines (2004:p76): "Supply chain strategies require a total systems
view of the links in the chain that work together efficiently to create customer satisfaction at
the end point of delivery to the consumer. As a consequence, costs must be lowered
throughout the chain by driving out unnecessary expenses, movements, and handling. The
main focus is turned to efficiency and added value, or the end-user's perception of value.
Efficiency must be increased, and bottlenecks removed. The measurement of performance
focuses on total system efficiency and the equitable monetary reward distribution to those

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within the supply chain. The supply chain system must be responsive to customer
requirements."

Supply Chain and Logistics

LSC, Supply Chain has three divisions and Logistics team has two subdivisions

Principal functions of LSC Supply Chain Management are:

∑ Transportation Management
∑ Distribution Management
∑ Inventory Management
∑ Cost Management

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 ∑ Payment Management
∑ Supplier Management
∑ Customer Service Management

Transportation and Freight Management

Transportation is one of the center sections of SCM which concerns with cargo
administration, shipment and transportation portion with vehicle sort, shipment size,
recurrence and so forth. TFM meets expectations for both inbound (obtainment) and
outbound (delivery) orders. Transportation and Freight Management for the most part
manages stream of products and data.

With the assistance of TFM individuals can figure out the expense of transportation of
products, it keeps up the nature of merchandise amid transportation, can discover the best
course and mode for the most straightforward transportation.

Transportation administration frameworks deal with four key procedures of transportation

administration:

1. Planning and decision making – TMS will define the most efficient transport
schemes according to given parameters, which have a lower or higher importance
according to the user policy: transport cost, shorter lead-time, fewer stops possible to
ensure quality, flows regrouping coefficient, etc.
2. Transportation Execution – TMS will allow for the execution of the transportation
plan such as carrier rate acceptance, carrier dispatching, EDI etc.
3. Transport follow-up – TMS will allow following any physical or administrative
operation regarding transportation: traceability of transport event by event (shipping
from A, arrival at B, customs clearance, etc.), editing of reception, custom clearance,
invoicing and booking documents, sending of transport alerts (delay, accident, non-
forecast stops…)
4. Measurement – TMS have or need to have a logistics key performance indicator
(KPI) reporting function for transport.

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(Vanek, 2014)

Transport and freight management helps organizations to improve the economic well-being,
social interaction, quality of physical environment and quality of daily life. It remains the
bridge between demand and supply by fulfilling the demand of people in new location where
no local supplies are available. Some components of TFM are: transit time, reliability,
accessibility, capability, Security (Coyle, 2011)

Requirements for perfect TFM

• For long separations water and rail modes are financially savvy as far as
transportation. Associations' settle their vehicle mode in view of separation. To contend in the
business numerous associations seek after the administration to enhance the foundation and
administrations of rail and marine modes.

• Standard calendar ought to keep up for accessibility of vehicles and labor to exchange
merchandise. It should be possible effectively through expanded computerization and
coordination among distributers. For simple transportation territorial conveyance framework
ought to be taken after. Amid conveying products in urban territories human fueled transport
ought to be utilized.

• Freight can be lessened by decreasing volume and superfluous bundling

• Implement armada administration programs that lessen vehicle mileage, use ideal
estimated vehicles for every excursion, and protect that armada vehicles are kept up and
worked in ways that diminish outer expenses (blockage, contamination, accident hazard, and
so on.).

• Change cargo conveyance times to lessen blockage.

• Land use availability ought to increment by bunching regular destinations together,

which decreases the measure of travel needed for merchandise dispersion.

• Vehicle energizes need to keep up effectively and decrease outflows through outline
upgrades and new advances. These incorporate expanded optimal design, weight

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diminishments, decreased motor grinding, enhanced motor and transmission plans, more
effective tires, and more productive embellishments.

• Training ought to ad lib for vehicle administrators to energize more pro

• Improve passengers’ ability to carry luggage and other baggage on public transit
(Goldman and Murray 2011).

Now a day’s organizations use ERP system for smoothen TFM. Some software providers are
either acquired or merged with supply chain management consultancies and started offering
shippers "blended"; managed and software services as an outsourced process. With new
innovations and technologies the efficiency of freight and commercial transport is getting
improved.

Transportation and Freight Management

LSC has a very structured transportation and Freight Management System. It follows two
modes of transportation: Barge and Truck. From plant the majority transfer happens with
barge and from depot majority transfer happens with trucks. LSC has contracts with some
transporters who transfer LSC products regular basis. The freight is fixed for per bags in
terms of cement. In terms of clinkers the freight is fixed by weight. GMS International
Surveyor provides us the amount carried by any barge.

Transportation Types

Stocks Transfer from Plant to Depots:

As per LSC business model stocks are being transferred from plant to depots and terminals.
This is called sales transfer/stocks transfer (ST). This is also called as internal transfer. For
this type of shipment LSC fleet operation team arranges transports by road & river and
enlisted suppliers provide required number of transports as per requirement of business which
is governed by transports planning and execution process. This transfer incurs the cost of

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freight, handling, BIWTA charges; empty bags consumption, demurrage etc which is called
as “ITC” (Internal Transfer Cost).

Delivered Basis Sales:

As Executive Logistics (Fleet Operations) organize the vehicles (street/waterway) for

conveying stocks at client end upon solicitation from deals group and accessibility of "SO" in
frameworks. This is called "conveyed premise" deals/shipment for which LSC is completely
in charge of cargo and different issues which will be secured by other piece of shipment
procedure. This shipment causes expense of cargo, taking care of, void packs utilization,
demurrage and so on which is called "FTC" (Freight to Customer)

Customer Pick-up Carrying:

There is another kind of transportation which is called "Client Pick-up Carrying". In this
connection client will organize transports (trucks/canal boats/trawler) at his own particular
obligation and send the same with legitimate documentation (DN, approval Paper). The
vehicles/transports will likewise take after line frameworks (serial) for stacking at individual
area.

Shortfall/ Damages

During delivery to customers there may be short fall in bags. Customer will inform sales team
about shortfall. Thereafter sales team will inform HO Logistics team (fleet operation) and
Customer Care Department. After that, Sales Operation & Customer Care will make a joint
visit to customer site for investigation of claim. Based on the investigation report, fleet team
will take necessary action on the basis of transport agreement.

Distributer Network

Appropriation system is another huge section of Supply Chain Management which is a

framework interrelate administration of individuals, storeroom and transportation through

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which products and administrations are exchanged from maker to customers. It is one of the
key drivers of benefit. With an organized circulation arrange an organization can increase
minimal effort and high responsiveness. The real significance of dispersion system is to give
products and administrations to clients when they need. Substantial as a multinational
organization, takes after diverse conveyance systems in light of their client's necessity. Case
in point, Wal-Mart control their expense and keep up its game changer with the assistance of
a great many partners, a privet armada of drivers, various appropriation focuses and
transportation workplaces and minimizing the quantity of miles its trucks travel unfilled.

There are three types of distributions in terms of manufacturing industry. They are:

1. Primary Distribution: when goods are distributed from plants to different warehouses or
depots that is called primary distribution.
2. Secondary Distribution: when goods are distributed from warehouse to customers that is
called secondary distribution
3. Tertiary distribution: when goods are distributed from warehouse to retailers that is
called tertiary distribution.

LSC Distributer Network

For smooth distribution of products, LSC has six depots in Kutubpur, Kanchpur, Sylhet,
Nowapara, Mirpur and Dipnagar. From plants cement is sent to these depots as stock, so that
goods can be transferred to the customers as early as possible. Kutubpur depot is fully owned
by LSC; others are handled by third party but monitored and controlled by LSC. At every
point LSC has handling contractor to load and unload goods swiftly.

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Inventory and Warehouse Management

The execution of a production network (responsiveness and productivity) is controlled by

choices in the regions of stock, transportation, offices and data. Stock is kept up in the store
network in view of confuses in the middle of supply and interest. Store network system plan
and displaying is a mind boggling framework and stock make it more unpredictable yet it
additionally gives benefit to the organization. Stock is extremely huge expense driver.

For diverse industry and items stock is kept and oversaw in distinctive ways. Expanding
stock gives higher responsiveness however brings about higher stock conveying expense.

A supermarket inventory network ought to utilize authentic interest examples for regular
things to mitigate weight on all individuals and give clients item amid crest interest periods.

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For autos the store network is planned in such a way, and get together operations are situated
with closeness to businesses, then the production network can be run economically without
holding an excessive amount of stock in travel.

LSC Inventory Facility

For wellbeing, smooth transportation, and consumer loyalty, LSC keep stock in its six stops
and plant. They keep the stock in such a path along these lines, to the point that simple
exchange is conceivable. Directly after creation the merchandise are sent to stations as
indicated by free space in every stop. Stops size and area were built up in light of the interest
of client and simple exchange office of that territory. In instances of crisis cement kept in the
capacity place of plant. In the distribution centers concrete sacks are kept in stacks. Stacking
is done in a deliberate manner with the goal that cement sacks can undoubtedly take out when
fundamental. From the distribution center, old concrete packs are dispatched first and
afterward new sacks. Other than distribution centers, there are dump regions where stocks are
kept also.

Stocks shortage or damage

In the distribution centers stock deficiency or harm may happen amid operations at those
capacity places. In the event that stock lack or harm is distinguished in third gathering
stations (distribution center/dump) amid compromise, Depot In-control will give authority
letter to stockroom/dump proprietor for joint compromise. After joint compromise, Depots
logistics group will bring up the issues with distribution center foreman on the premise of
administration assertion and stocks quality will be deducted from builder's bill. On the off
chance that LSC is in charge of stocks deficiency or harm for at all reasons (like long
stockpiling & then clearing) then stocks alteration will happen according to DOA of the
organization. LSC & transport builder will settle protection claim where material according
to the terms of the administration understanding.

LSC Cost Management Optimization

Lafarge, utilizing the LCA (is an institutionalized strategy which permits the indispensable
record, measurement and assessment of the natural harms joined with an item, a
methodology, or an administration in the setting of a given inquiry) system, has recognized

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various levers which will decrease the expense of developments all through their lifecycle
while keeping up or expanding their social and ecological exhibitions:

• Decrease underway expenses;

• Reserve funds in worksite time and assets;
• Configuration of structures and developments which are monetary in their use stage (vitality
devoured, support, and so on.);
• The strength, adaptability and recyclability of developments and structures after some time,
i.e. their capacity to be

Logistics Cost Reduction

Transportation through waterway state of mind is 3 times less unreasonable than

transportation through street. That is the reason LSC transport its two third generation of
concrete from plants with canal boat through waterway temperament. Just concrete needed
for Sylhet warehouse is exchanged by truck. As far as exchanging from warehouses to client
it is exceptionally hard to send through freight boat. At the point when cement is send by
organization transport, in longer course cost increments yet in shorter course cost decreases.
So LSC diminish cost by selecting shorter course for organization exchange and maintain a
strategic distance from longer course.

Another approach to lessen logistics expense is arrangement with the transporters and
handlers which for the most part relies on upon sum and improving limit use.

For stock the expense once in a while varies. LSC consistently screen how cost can be
decreased without diminishing quality and administration.

Parts of IT in Supply Chain: ERP

With the improvement of programming building, now a day's business is keep running with
the assistance of distinctive programming. This product can be tweaked by business
prerequisites. Endeavor Resources Management (ERP) is extremely surely understood
undertaking administration programming which serves to modernize the business process.

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Utilizing a typical database business can gone through distinctive divisions and better places.
ERP framework track business assets precisely.

Backings done by ERP:

Product arranging, cost and advancement, assembling or administration conveyance,

promoting and deals, stock administration, transportation and installment, dispersion process
administration, store network administration, administrations learning base, design, costs,
enhance exactness of budgetary information, encourage better venture arranging, mechanize
worker life-cycle, institutionalize discriminating business systems, diminish repetitive
undertakings, survey business needs, bookkeeping and money related applications, lower
obtaining expenses, oversee HR and payroll.ERP encourages data stream between all
business capacities, and oversees associations with outside partners and mistake free
exchange and creation. In spite of the fact that early ERP frameworks concentrated on huge
undertakings, littler ventures progressively utilize ERP frameworks.

Lafarge Style:

LSC utilize the JD Edwards altered framework for its business. The focal server of LSC is
arranged in Singapore yet it is controlled from Malaysia. Each bureau of head office and
stops has distinctive capacity in JDE.

Result of TM:

• Visibility of transportation expense.

• Eliminate a ton of manual employments.

• Easy bill checking and smooth installment process.

• Route shrewd expense examination and recognize chance of addition.

• Transporter fulfillment for on time installment.

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• Solid establishment for a cargo database.

• Target accomplishment and overcome gathering review perception

• Activates in JDE

LSC Logistics SRM Management and Practice

As being a people oriented organization, LSC maintain strong and loyal relationship with its
suppliers. LSC Logistics department has three categories of suppliers.

Transporters- manage truck and barge for smooth transportation of goods from plant to
different depots and from different depots to customer ends.

Handling Contractors - manage on time labor for loading and unloading of cement in
different depots and customer end.

Depot Contractors- manage the warehouse for stocking and maintain the quality of goods.
Except the Kutubpur Depot, all other depots of LSC are run by third parties. In most of the
depots, the depot contractor manages the handling work.

LSC do long term contract with all its suppliers based on “Sales Level Agreement”. They
have given target for every month; based on their achievement the next month target is
provided. These monthly targets are set based on annual target and budget.

Preparing for suppliers:

LSC attempt to keep up a standard level as far as quality and administration in each layer of
its business. Along these lines, they attempt to prepare up its suppliers how they can enhance
their administration and workplace. By consistent correspondence LSC figure out the issues
they face and attempt to illuminate those. They are given preparing on wellbeing and
legitimate methods for performing woks in a brief while.

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Estimation of execution:

The execution of the suppliers is measured by watching a few issues:

o Safety

o Warehouse administration

o Stock administration

o Customer criticism

o Response time

o Labor accessibility (for Handling Contractors)

Payment Management
For Logistics operational purpose, LSC has contracts with different transporters and handling
contractors as well as with some service providers. They submit their bills to the Head Office
after service received from users with authentication. To provide their payments LSC need to
process that bill for proper checking and documentation after compliance.

Types of Logistics Payment

Transporters freight bills

Handling bills

Others (Petty cash, Fuel/Utility bill etc.)

Payment Process Owner

Logistics Executive is the process owner of SOP for freight bills.

Start Point

Receiving bills from suppliers and entry in ITS

End Point

Providing checks to the suppliers through Finance

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LSC People Management Strategy

In light of division need, LSC enlists exceptionally qualified workers. For enrollment they
gathers resumes, sort out those in view of instruction and aptitudes. At that point call "sort
out" contender for bent test and meeting. After that second period of meeting is taken by the
executives lastly enroll the best representative for the organization. In the wake of enrolling
workers, LSC give extraordinary preparing to every representative. Some broad preparing is
given to all representatives:

• Preparing on Company Policy

• Direction on Behavioral Expectations

• Preparing on Health and Safety

• Preparing on VAT and TAX

• Correspondence Training

For Logistics Department Employees are given some unique preparing:

• Outline on Supply Chain

• Preparing on Transportation Management

• Stockroom Management

• Monetary Analysis

• Programming administration Training

• Authority Training

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Assessment of Employees

Consistently the workers are assessed by Key Performance Indicators (KPI). For individual
worker KPI is given altered at the beginning of the year. The entire year, execution is
assessed in two ways:

I. Administration and Leadership Skill: How great the representative is dealing with the
workplace, how the worker is performing wellbeing measures and how well in driving
colleagues.
II. Useful Skill: How productively the representative is performing own employment
obligations

In light of these two abilities last assessment is finished. In the event that any representative
has lacking on any range, unique preparing is arranged.

Shipment Process

The goal of this procedure is to guarantee emptying stocks from plant and conveying the
same merchandise to client end through terminal & stations with compelling transportation &
warehousing frameworks alongside keeping up standard procedure, agreeability and
wellbeing.

This over all procedure is reported by Logistics division and sanction by Supply Chain
Director. All logistics workers take after this as unchangeable rule. On the off chance that any
change obliged then the entire office have a meeting and fix the progressions and after that
take regard from the SCD.

Customer Management System

Lafarge treats its clients in a productive approach. It needs two sorts from claiming
customers: Retailers and end consumers. Greatest bargains need aid carried of the retailers.
Those retailers would provide for A large number offices In view of their execution.

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Logistics Branch doesn't straightforwardly handle the clients However if any whine found
from client’s related logistics that is monitored Also took care of Toward those logistics
group.

Client protestation & come back merchandise oversaw economy.

Client Complaints: In there will be At whatever protestation viewing item quality, afterward
client informs those deals group. Offers fewer groups authoritatively send mail on client
forethought less group to examination. Then afterward investigation, client mind
manager/executive informs logistics less group for substitution cost for merchandise
following endorsement from concerned power.

Come back goods: Assuming that any protestation emerging starting with the client will be
advocated and endorsed Furthermore approved by worried cooperation At that point vital
activity will be taken Toward particular logistics less group to came back merchandise from
client webpage upon Regard laid down to client objections taking care of strategy.

Came back products adjustment: following settlement from claiming client objections
Furthermore bringing physical give back of products starting with customer, webpage station
in-charge/terminal administration faculty speak for ho offers admin cooperation for change
over framework & production about new “SO”. Then afterward accessibility for “SO” in
systems, station / terminal logistics group organize reinstatement for merchandise.

Corporate Social Responsibilities

As being a part of society we all have some responsibilities towards our surrounding society.
Based on our ability we should fulfill this responsibility. Like individual human being a
corporation or business has also some farm duties for the society, in general it is called
corporate social responsibility. According to institutional theory, corporate social
responsibility consisting of a series of propositions specifying the conditions under which
corporations are likely to behave in socially responsible way. The initial objective of a
business is making profit, but now the large multinationals and other businesses are focusing
on Corporate Social Responsibility, which means they are trying to be ethically, legally and
socially responsible towards the society. According to James Brusseau, three theoretical
approaches had established for Corporate Social responsibility.

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 . Corporate social responsibility (CSR)

. The triple bottom line

. Stakeholder theory

Output of the event:

∑ Through this program LSC gave training around 1320 workers and engineers.

∑ All the employees who participated in this volunteering program appreciated the
program as they felt very proud to be a part of this volunteering. They showed their interest to
participate in more volunteering programs like this.

∑ Labors were happy to get involved in these types of workshop. They said they had
learned many safety instructions from this workshop and they committed to practice these
instructions.

∑ Developer companies provided positive feedback and accepted it as a great initiative.

Some of them want to arrange similar bigger event with all of their workers.

∑ Engineers were instructed how they should train up their workers.

Finally, through this volunteering program, LSC contributed the society and tried to bring
change in the life of its stakeholders.

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LSC Health and Safety

“Safety is priority” with this motto LSC serves its stakeholders. All employees of Lafarge must
have to follow the safety rules. They are provided special training on safety so that each
stakeholder’s life can be secured. Lafarge goal on safety is -zero accidents, incidents or
occupational illnesses. LSC has 11 rules on health and safety. They are:

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Job responsibilities

∑ I used to compile monthly transfer costs (freight, handling, BIWTA charges; empty
bags consumption, demurrage) for each transporters and kept record.
∑ my responsibility was to collect the handling bills, recheck them and after processing,
send to Accounts Payable for payment. Besides that I analyzed those bills to find out
whether we can minimize cost at any point.
∑ I was responsible to check their bills with JDE transport module and keep
documentation. Then I took approval from Logistics manager. After processing the
bills I send them to Accounts payable department for check disbursement.
∑ After joining in the Logistics Department, I had to go through the whole Shipment
Process to understand how logistics works are done by LSC. Following that process I
had to do all the assigned jobs. Furthermore, I had prepared two SOP (SOP for ST
Truck Unloading and SOP for Bill Processing) and coordinated in another SOP (SOP
for Depot Opening and Closing).
∑ Participated in preparing the presentation on “Safety instructions”
∑ Monitored the personal protective equipment and timely handover those to each
group.

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Project Work

Summary

Here in this project part I have described some of the important topics related to the cement
industry of our country in terms of LSC. To start up, brief information of cement industry of
Bangladesh and the concerned product “Cement” is given. Passing on to that, objectives of
this project, relation of LSC among other cement companies, methodology, key players in the
industry, ranking and positions along with the competitive analysis followed by swot
analysis.

Project work description

Objectives

Objectives of the project work are:

To analyze the overall cement industry in terms of the current scenario of LSC
To predict the competitiveness among the key players
To have a better understanding of the cement industry of Bangladesh

Methodology

This project has been done by collecting information from diverse applicable sources. A few
records have been taken by watching and working with the organization itself. On the other
hand, this report additionally comprises of a lot of information got from both primary and
secondary sources.

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Brief History of Industry

Cement Industry, a generally quickly developing industry, is creating in pace with expanding
building and development exercises. Concrete has long been utilized as holding operators to
unite particles or to bring about one surface to stick to another. Today pressure driven
cements, of which Portland concrete is most well known, when made into glue with water
and total, set and solidifies as a consequence of synthetic relations in the middle of water and
the mixes present in cement. With great pressure driven concrete, advancement of quality is
unsurprising, uniform and moderately fast.

Verifiably, Bangladesh did not depend much on concrete. It likewise does not have enough
normal assets for assembling it. The base materials generally utilized as a part of house
building and other development obliged little utilization of cement. Progressive substitution
of customary building structures or examples by cutting edge skyscraper ones have pushed up
the utilization of cement. Be that as it may, as the economy keeps on remaining agro based,
development divisions have not possessed the capacity to pick up energy and as the base
advancement is specific, cement remained result of low request. A speedier development
sought after for cement has been watched just since mid-1980s, particularly with usage of
huge framework ventures, expanded pace of urbanization, development of condo structures
and multistoried shopping edifices in urban ranges, and a movement in the essence of well-
to-do rustic individuals for present day houses.

Bangladesh has received EN197-1:2000 as Bangladesh Standard, titled BDS EN 197-1:2003.

Under this Standard there are 27 items in the group of basic cements, which are assembled
into five principle concrete sorts as takes after:

Blast furnace cement

Composite cement
Portland cement
Portland composite cement
Pozzolanic cement

In the year of 1995, the administration first gave authorization for building up cement
commercial enterprises in Bangladesh. Notwithstanding, this authorization was given to the
organizations with no sort of exhaustive former investigation of the business. In this way the

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beginning stage of the foundation of the concrete business occurred without the best possible
examination of the interest and supply of cement for the nation. Inside of the compass of the
following 2 to 3 years, the supply of cement coming into the nation confronted an extended
limit of the item.

Competitors Analysis

The largest 13 cement manufacturers hold 78% of the market share. Heidelberg, Holcim and
Lafarge are the leaders among multinational cement manufacturers and Shah and Meghna are
the leading domestic manufacturers. Shah cement is the market leader with close to 14.20%
of the market share, closely followed by Heidelberg with about 9.30% of the market share.
During the 2010, many small local manufacturers like Premier, Seven Circle, Crown, Fresh
and King cement increased their sales drastically riding on their benefits of economies of
scale, backward linkage and aggressive marketing effort.

70% of the market share belongs to the local companies and the rest 30% belongs to the
multinational companies (in total 5).

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To compare between a local and a multinational company I choose Shah Cement and
Heidelberg Cement. In terms of products offerings, production and technology, and price the
differences are analyzed as follows:

Products offerings: Shah Cement offers Shah Cement Special and Shah Cement Popular,
LSC offers Supercrete and Powercrete whereas Heidelberg offers only Scan Cement and
Ruby. In order to survive in the industry all top 10 companies uses almost same functional
activities. Every cement company uses unique names to offer their products. In terms of

Production and Technology: In terms of technology there is hardly any difference among
them as they are the top players of the industry. Being the market leader Shah cement has
some unique features that make the difference. It has the highest production capacity which
amounts to 2,700,000.00 in MT/year followed by Heidelberg 1,800,000.00 in MT/year and
for LSC it is around 1,600,000.00. When we come to technological aspects Shah cement has
an upper hand like its high-tech bagging plant is capable of producing 3 lac packs per day;
where packaging unit is equipped with exclusively Star linger High tech Machinery. Shah
Cement is the pioneer to use stitch free bags. Lafarge has one huge advantage over these two
which is- it can produce its products with its own resources without importing anything from
outside.

Price: Price varies from area to area or locations to locations but very close to one another.
Pricing of cement bags is done by observing the price of the competitor’s products. For a
sample, the business pioneer of cement in Dhaka is Shah Cement. In this manner the cost of
the results of Heidelberg and LSC in Dhaka is altered relying upon the cost of Shah Cement
in Dhaka. Then again, right now Ruby Cement is the marker pioneer in Cox's Bazar and
Supercrete is the business pioneer in Sylhet. In this manner the cost of Heidelberg items in

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Cox's Bazar and Sylhet will be altered according to the cost of Ruby and Supercrete. This
methodology does result to a fluctuating cost of the same item starting with one area then
onto the next yet in any case; there is never a hole of more than Taka 10 inside of the nation.

Observation
From my three months experience I have watched a few issues where LSC has absence of
productivity. I am clarifying those issues here:

. In the transportation framework, the transporters once in a while make delay in conveyance
of merchandise, as a result of activity, now and again they waste time in streets and here and
there they squander products quality. This issue makes some misfortune like client
disappointment, loss of merchandise and so on.

. Some of the time line of requests happens in view of sudden request from the client in an
odd time. Like, if any client give request by the day's end it is not generally conceivable to
convey item the following morning.

. LSC don't load or empty amid terrible climate. In this way, amid the blustery season the
stops here and there get to be out of stock and clients need to sit tight for quite a while for the
merchandise. For terrible climate LSC needs to number loss of numerous hours.

. The stockrooms are overseen in a manual manner, similar to; the amount of stock in any
distribution center is measured from the information of offers, which does not give precise
data. There is no programmed including framework the distribution centers. For this lacking
at some point the distribution centers got to be out of stock or overload.

. LSC assess suppliers by just watching their administrations, yet there is no standard
configuration to gauge the execution of suppliers.

. LSC gives great support of its clients, after that it doesn't keep up any estimation level for
client administration. There is no "Service Level Agreement" with its clients.

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Recommendation
LSC can execute GPS framework in the vehicle so that from the head office the
vehicles can be checked. With the assistance of GPS it can quantify, which vehicle squander
the amount of time in movement and some other issues. It can likewise be observed whether
the transporters are included with any fuel pilferage or some other wrongdoing.

Automation can be acquainted in line administration with give the products to client
on time.

During blustery season, transportation for the most part done through trucks. In this
way, long separation ought to be kept away from by truck. It will diminish the expense.
Additionally, taking into account interest anticipating the warehouses ought to be filled
before stormy season.

in every distribution center, programmed checking framework ought to be set up, so

that when the concrete sacks will stack in the stockroom framework will keep record and
amid uprooting products framework will do same. From the both data, correct free space can
be measured and in view of the precise measure of products can be sent.

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Learning:
v Timing: we all know “time is money” and in Lafarge I came to know how important it
is to be time specific. If any meeting is on 1p.m then by any means that meeting has to
be on time.
v Team work management: every team works to carry out their members to accomplish
the given task whether it is HR, Finance, Marketing or Logistics department. Working
as a unit not as individuals is their main theme.
v Corporate manners and culture: in our day to day life the way we intend to do things
we just do it but in an organization like LSC I came to know corporate norms,
manners and culture. It seemed to me that everything is structured and organized.
v Real work life experience: in these three months I never felt like I was an intern as I
always felt that I was working as a real employee.
v Business terms and conditions: my internship gave me a real chance to closely
practice the business terms and conditions.
v Communicate with corporate: just doing a job by sitting on the desk and
communicating with corporate people to accomplish a task are two different things.
Fortunately I got both the opportunity during my internship. I used to communicate
with not only the employees of head office but outside of the head office as well.
v Other than that I have learnt more features of excel, how to do scanning and
photocopy.

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Screen shots of JDE Software

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