December 19, 2017

Prepared For

Professor Dr. A. K. M. Saiful Majid

Director, IBA-DU
 Prepared By

Syed Bayzid Hasan Md. Jahidul Islam Jetan Bhattacharj

EMBA Batch 23: EMBA Batch: 24, ID: EMBA Batch: 24, ID:
25ZR1503006 ZR1601020 ZR1601029

A K M Mahmudul Farhana Sharmin

Md Monir Hossain
Hasan Mithi
EMBA Batch: 26, ID-
EMBA Batch: 24, ID: EMBA Batch: 25, ID-
ZR1603018
ZR1601007 RQ1602026
 Content

Case Study on HATIL

Vision & Mission - PESTEL Analysis
Furniture
HATIL

Porter’s Five Forces Strategic Group

SWOT Analysis Analysis on HATIL Analysis of HATIL
Furniture Furniture

KSF (Key Success

Five Generic
Industry Drivers Factors) of HATIL
Competitive Strategies
Overview of Bangladesh Furniture Industry

 Traditionally a cottage based industry Bangladesh Furniture Export Trend

Low labor cost-Competitive Advantage over 45

42.58
38.94
other furniture exporters like China 40

 By 2018 Bangladesh will earn export 35

27.14
31

EXPORT $ MILLION
potential of crafts furniture accessories 30 21.38
worth of USD 20 million along with 25 19
furniture worth USD 60 million. 20

 At present more than 45,000 enterprises 15

and nearly 2.5 million un-skilled and semi- 10

skilled people are engaged in this sector. 5

 Some top players of Bangladesh Furniture 0

2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015

Industry- HATIl, Brothers Furniture,

PARTEX, Otobi, Navana Furniture
 Overview- HATIL
Journey of HATIL • Established in 1969 as a timber
in Bangladesh company & rebranded itself as
a furniture producer in 1989

• Offering wide range of products

“Smart Fit” furniture
Idea of SMART FIT including
which are space-saving furniture
Furniture like wall cabinets, sofa cum bed,
space saving bed

• The largest manufacturing plants-

Resources over 2000 employee- around 80
showrooms in Bangladesh

• Pioneer in exporting furniture and

Footprint in its export coverage includes USA,
Abroad Canada, Australia, Saudi Arabia,
Kuwait, UAE, Thailand, Egypt,
Russia
 Vision & Mission – HATIL Furniture
Vision

To earn the trust and respect of our customers in Bangladesh and abroad.

Mission

We innovate, develop, and introduce cost effective, space solved, and environment
friendly furniture with technological advances.
Few EXCLUSIVE Facts of HATIL
Proud
Manufacturing recipient of
environment- the HSBC-
friendly Daily Star
furniture Climate
Award

Utilizing Only FSC

“Just-in- certified
Time” furniture
manufacturer in
manufacturing Bangladesh

Using
environment- Operates
friendly UV single brand
lacquer showrooms in
Australia and
Canada
 P E S T . E L
Environmental
Political Economic Social Technology Legal
• Wood sourced from
• Political • Economic • SMART • Large • Environ
FSC certified suppliers mental
Instability Growth FIT production
• Using environment- Law,
• Cash • Income Furniture Capacity Import
friendly UV lacquer and
Incentive level and to cope • Technologi • Using com busting Export
Policy,
for Living up with cally scrap wood and Patent
exporters Standard the trend advanced sawdust to generate and
Design
• Import • Labor • Cultural for power for its Act of
manufacturing 1911 etc.
Policy and Cost Factors utilizing
facilities.
Tariff for • Market KAIZEN
• Proud recipient of the
Importers Growth
HSBC-Daily Star
industry
Climate Award
 S
• Wide range of products
• Innovative & Exclusive
design
• A loyal customer base
• Environment positive attitude
• Skilled craftsmanship
• Use of advanced machineries
for production
• Raw materials are imported
from abroad, so it doesn’t
affect the country’s
environment
• Stable financial condition
• Prominent Brand value
• Office decoration facilities
W O
• Cost-efficient
T
• Increased
. popularity of
• Higher price than technology substitute products like - RFL
close competitors
• Reducing the price by plastics, board & Iron based
• No opportunity for maintaining profit furniture
customization in the • Connection with • Downward pricing pressure
design famous artists & • Extreme competition
• Limited distribution architectures • High exit barrier
channel • Expanding business • Lack of Import barrier
• Limited showrooms through providing • Oligopoly market where the
• Marketing executives Interior designing other competitors like OTOBI,
& Sales persons • Growing customer BROTHERS, NAVANA &
• No clearance sales are base AKHTER are dominating the
conducted • Exploring the Global market
market • Compressed PLC
• Approval of • Dependency on the imported
environmentalist Raw materials
organizations • Supply insecurity
 Strategic Group Analysis
Band Name Of the Showroom Total Response Value Total Number Of Respondent Quality Price
Total Number of Respondent in Band 1 Akhtar 489.6 117 4.18 High
Google Review Band 1 Hatil 1120.4 273 4.10 High
300 279 273
Band 1 Hi Fashion 138.1 34 4.06 High
250 Band 1 Brothers 257.9 64 4.03 High
200 Band 1 Partex 277.7 69 4.02 High
150
Band 2 BD Furnitire Solution 47 10 4.70 Low
117 114
Band 2 Furniture Mela 36 8 4.50 Low
100
69 64
51
Band 2 Athenas Furniture And Home Décor 27 6 4.50 Low
34 34
50
17 15 10
Band 2 Otobi 1121.2 279 4.02 Low
8 7 6 6 6 3
0 Band 3 Nadia 133.4 34 3.92 High
Band 3 Legacy 22.8 6 3.80 Mid
Band 3 Medalion Furniture 58.5 15 3.90 Low
Band 4 Zara 22.2 6 3.70 High
Band 4 Koncept 61.2 17 3.60 High
Band 5 Regal 424.3 114 3.72 Low
Band 5 Muntafi 158.1 51 3.10 Low
Band 5 Firniture Bari 18.9 7 2.70 Low
Band 5 Furnitec 6.3 3 2.10 Low
 Porters Five Forces Model
THREAT OF NEW ENTRY SUPPLIER POWER
High -Low
-Designs can be copied -Red oak wood imported from North America
-China ,France & USA are the major suppliers of
-Raw materials can be of different grades to copy -- this wood
No govt restriction for entering in the industry

THREAT OF SUBSTITUTION
-Threat is HIGH
-Increased usage of light furniture like plastic furniture
&wrought iron products
COMPETITIVE RIVALRY
THREAT OF BUYER POWER
-Major Brands OTOBI,BROTHERS,PARTEX,AKHTER
-Very HIGH ,NAVANA
-Increased distribution of competition -Other players like Import based & local manufacturer
-Increased penetration of information technology -Increased Social media presence of major players
-Online stores penetration -Low switching cost
-Low customer loyalty & switching tendency
 Strategic Group Mapping
Price

Quality
 Industry Driver
INDUSTRY DRIVERS HATIL’S RESPONSE

1. Preference for simple and Hatil with the slogan “SLIM IS SMART” always opt for simple,
light-looking furniture light-looking furniture with no or minimal ornamentation
2. Innovation Hatil is very innovative not only in case of design but also in
materials used and furniture color
3. Growing middle class with Hatil is catering need of the middle class with the strict budget by
tight budget providing furniture with reasonable price and interest free
installment facility
4. Durability issues (Strength, Hatil’s furnitures are guaranteed for durability and parasite proof
parasite proof)
5. Online shopping Hatil has a very useful website from where customer can choose

6. Multifunctional foldable In last Dhaka Intl. Trade Fair Hatil has introduced a wide range of
furniture multifunctional foldable furniture.
FIVE GENERIC COMPETITIVE STRATEGIES
 Five Generic Competitive Strategies
1. Low-cost Provider Strategy

Targeting:
•Price sensitive market- price conscious buyers
•Segments with limited incomes
•Extreme price competitive markets
•Products are essentially the same

Examples:
Regal Furniture
OTOBI
Navana
 Five Generic Competitive Strategies
2. Broad Differentiation Strategy

Targeting:
•A broad range of buyers
•Value conscious consumers
•Products and services stand apart in consumers’ minds
•Customers looking for a unique value proposition
•Premium price products
Examples:
Akhter Furniture
Brothers Furniture
 Five Generic Competitive Strategies
3/4. Market Focused Strategy - Cost and Niche

Targeting:

•Price conscious customers (similar to low cost provider strategy)

•Well defined segments
•Appealing to cultures and geographical preferences
•Brand loyal customers
•Appeal to broad market segments (low cost)
•Wants and needs of narrow and unique market segment (niche)

Examples:
Various Non-Branded Shops providing customized furniture
 Five Generic Competitive Strategies

5. Best cost provider strategy

Targeting:
•Low cost, differentiation markets (a hybrid)
•Broad markets and market niches (middle ground)
•Value conscious buyers
•Those who shy away from cheap, low-end products and expensive high-
end products
•Willing to pay a fair price for functionality and performance
•More for the money
Examples:
HATIL
PARTEX
Key Success Factor (KSF) - HATIL
Strong
Brand
Environment Image
-friendly
UV Right
Lacquer Team Mix

KSF -
Nation HATIL
Wide Operational
Coverage Excellence

Consumer Modern
Centricity Design
VIDEO
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