KAYANGAN ADBIZ SDN. BHD. BACKGROUND: Kayangan Adbiz is a private company registered under the Companies Act 1965 and has been inthis industry for about six years. The main objective of the company ‘to carry out on all forms of businesses such as all forms of advertising, public relations consultancy and sales promotions. The company also undertakes publicity for making known eny products and deals in all kinds of advertising novelties and products, signposts, signboards, banners, backdrops and other advertising signs. Kayangan Adbiz product lines also include printing, supply of stationeries, lithographers, type-founders, stereotypes, electrotypers, photographic printers, engravers, diesinkers, designers, draughtsmen, paper and ink manufacturers. They also carry out on basinesses of interior designs and services connected with the renovations, beautifications and improvisation of offices and buildings. In the pipeline of their business activities, it also provides all sorts of services in transportation of events. Presently, Kayangan Adbiz Sdn, Bhd. is operating at Lot 48, 2 Floor, Persiazan Jubli Emas, Kangar, Perlis. Their workshop is situated at 2, Lorong Satu, Jalan Padang Katong, Kangar.ORGANIZATIONAL STRUCTURE Figure 6.1 ayangan AdBizSdn. Bhd. Managing Director Productive/Creative Director Marketing Director Administrative (& Finance Director Creative Office Production Workshop Admin & Finance 2 Staff members) (1 Staff members) (2 staff members) Assoclates Companies Part Time Workers ‘SALES PERFORMANCE ‘The sales of the company bas increased tremendously by 97% in year 2002 due to the tenders from various companies in the state and neighboring states and remain ‘almost constant for year 2001 as depicted in Table 6.1 below peer cee eee YEAR | SALES | GROWTH TREND 2001 | RM286480 | 2002 | RMS65.360 oie 2003 M600,000 6.1% cesar EE ‘SERVICES ‘The present services marketed by Kayangan Adbiz are advertising and designing. ‘The services include signages for commercials, roads, safety, silkscreen printing, interior decoration and renovation, event management and supply of event advertising facilities. PRICING A few examples of prices of Kayangan AdBiz's products/ services are quoted presented as follows:‘Table 6.2 PARTICULARS, SELLING PRICE | |. High Inensity Reflective Traffic Sign 1RM993,.60 - RMS.485 | Generating (teen | MAO - RMIO0 | | 3.Design, artwork, manpower, tools, | RMB6,000 — RM12,000 transportation for events 4. Signbosnds (Outdoor) RM2,970 ~ RMI4,500 | | 5. Portable signboard RMISO~ RMSOO The pricing strategies adopted ae: Going-Rate Strategy ‘The firm bases its price largely on competitors’ prices with less attention paid to its own cost or demand, The firm might charge the same, more, or less than its major competitors. This company is using this strategy because the costs are difficult 10 measure or competitive response is uncertain. The company feels thatthe going rate pricing represents @ good solution. Sealed-Bid Pricing ‘Competitive-oriented pricing is common where firms bid for jobs. The company bases its price on expectations of how competitors will price rather than ona rigid relation to the firm's costs or demand. The firm wants to win the contract, and winning normally requires submitting @ lower price than competitors. MARKET SHARE AND COMPETITORS: InPerlis, Kayangan Adbiz is the only Bumiputera Company that is actively involved in this industry with seven (7) other competitors who are non-bumiputera. ‘According tothe survey conducted by them in year 2003, the company is ranked ‘as number three with its marketshare of 20% of the total market. The percentage ‘off market share by each company in Kangari as follows:2507 Cty 25% asere NB | 16. Fay Khoo Signeratt 2% Po NB | 7. We Sun Signeraft 2% Po NB | Note: B= Bumiputera, NB = Non Bumiputera, G = Government, SG = Semi Government, ASS = Associations, PC = Private Company INDUSTRY BACKGROUND Advertising can be defined as any paid form of non-personal presentation. It promotes ideas, goods or services by an identified sponsor. It is a service industry, which emphasize on utilizing of multimedia and other ICT equipment support facilities, In Malaysia back in 1980s, advertising was conceptualized es means of information of a product or services. The industry was not popular and regarded 2s not a good source of income and not worth venturing into. However, nowaday’ advertising has played an active role not only as a medium of imparting information but also is an important element o outperform competitors. ‘Today, the Malaysian advertising industry’ ideas are on par with developed nations such as the United States and some in Europe. The only two drawbacks faced by the industry here are time constraints and budget allocation, which can affect the quality of reative works. In future, with the wide availability of information and communication technology, itis expected that advertising industry will be the main ‘element in the suecess of a product or service.‘Due to rapid development in Kangar, the need for advertising and interior design fare increasing. Town development such as in Kuala Perlis, Arau and commercial ‘areas have spurred up the market for advertising, Currently, the companies from Langkawi and Alor Star are among the major customers who have been patronizing Kayangan AGBiz services. With the government policy which must open its tender only to Bumiputera Companies, Kayangan Adbiz is monopolizing this status being the only Bumiputera Company which has been registered and eligible for any governmer: related work in advertising, event management and interior décor. INTERNAL ENVIRONMENT Kayangan Adbiz hes the advantage of skilled and experienced staff in the advertising industry. This isthe core competency required inthis industry looking at the nature of the job. It requires creativity, innovation and skill in technical work such as printing, designing and computer literacy. Inthe duration of six years in the industry, Kayangan Adbiz has established good rapport with its client due to good services offered to the customers. Froza our jbservation, Kayangan Adbiz has. good traits such as patience, prompt and the ‘bility to convey what is required by customers even in odd hours without any complaints and with a smiling face. ‘The company has established good rapport and networking with the supplier who ccan supply enough materials at any time required by the company. The company can also easily obtain the supply on eredit from good suppliers. Kayangan Adbiz is the only Bumiputera company in the advertising industry in Kangar. With ths status, the company is having the competitive edge in competing swith other non-bumiputere companies especially in works offered by government that requires Bumiputera status in any participation of tender. ‘Based on observation, it was noted that Kayangan Adbiz is also one of the biggest Bumiputeca companies in Perlis in terms of sales, number of staffs, assets and company development. The company has created the image with the implementation of several working systems such as application of SS, SGA (Small Group Activity) ‘Staff Performance analysis and working attire (using uniform for technical and field staf). With the increasing workload, the company is having a shortage at ‘management/ supervisory level to monitor and supervise the fieldwork.Presently, the company is facing financial problems because it requies upgrading the machineries and adoption of new technologies in order to enable them to be ‘competitive. To have capital injection for new machineries with the latest technology, the company has obtained a loan from government agencies. There is also 2 lack of research and development activity for continuous improvement. Due to the small size of the state, there is less promotional activity at state level, EXTERNAL ENVIRONMENT ‘The government policies, both state and federal, emphasize on Bumiputera participation in business as well as requirement of Bumiputera status in any government work. This has given an advantage to Kayangan Adbiz. With {government support in rendering loans to solve financial constrain, it will enable the company to expand as well as adopt new technology. The economic growth in the state is quite encouraging. Kangar has developed very fastin the last five years and it has created alot of business opportunities for che company, ‘The increase in demand for Kayangan Adbiz services indicated a good sign especially in advertising. With the increasing demand, the company can further project its income. It will allow the company to expand and improve further. Being a pioneer Bumiputera company in this industry, indirectly, the company has become the leading Bumiputera company which can sell by itself in future with the symbol of trust and good image. For the past three years, (wo more newcomers have come into the market. This hhas somehow taken the market share that was comfortably shared by 6 competitors. ‘The advertising industry is exploiting the usage of technology. The latest technology has given the competitors the new product outlook and efficiency in their services. “The existence of the internet has made the shift from conventional advertising 10 website on advertising. In this case, an advertising company has to acquire this knowledge in order to keep abreast with technology development. MARKETING ‘The present markets are government agencies and private companies in Kangar. In future, the company is going to expand its market to other major towns likePenang, Butterworth, Sungei Petani and to the neighboring country and town like Hadyai. The company will be introducing a new product that is the Neon Lighting ‘system, Large Format Printing, Back Lid and other relevant product, which has the big potential demand. The price of the product is based on the current market price in order tobe at par with competitors, At present, the company has its outlets in Kuala Perlis and Arav. To widen the market, they plan to have smart partnership with other advertising agencies in Alor Star and Sungei Petani to enable the company to expand their market. It meets the demand of the client by completing the contract given within the period given. The company needs to maintain its product quality and continuous improvement in order to remain ahead of the competitors. Quality would include serviees, materials and workmanship as well as delivery time. This is especially ‘rue when looking at the nature of the job whereby things need to be done fast and with quality, for example, event management. The company must also offer good after-sales service, The company recognizes that to maintain its present Customers is cheaper than attracting new customers. The company will, by any ‘means, try not to loose any existing customers by keeping their database as well as continuously promoting their services to potential customers. They will continuously give quelity service on their products and initiate the company’s networking with the customers to establish and maintain relationships with customers. “To further penetrate potential markets the company needs to advertise and promote its services. The company has overlooked this. Failure to blend advertising with other marketing mix of their services can cause their rivals to overtake their market and existing customers. Besides advertising through the website, the company ‘advertised in the local newspapers and flyers were distributed to government and private agencies. “There is no specific research and development department, but the information about the industry is gathered through media, present clients, compettiors and top management (board of directors). For more effective research and development, the marketing division of the company will focus on its research and development and marketing esearch, “The company needs to maintain its product quality and continuous improvement efforts in order to remain ahead of the competitors. Quality would include services, ‘materials and workmanship as well as delivery time, This is especially true looking ‘at the nature of job where things need to be done fast and with quality, for example ‘event management.MANPOWER ‘The company plans to recruit additional workers especially staff atthe supervisory level in order to monitor and control the overall operations effectively. Sales force will be expanded in the production workshop and creative office. They are trying to get extra part-time workers in the production level and a marketing officer in order to enhance the marketing and promotional activities.