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Mar, 11 2013

ARCHITECTS OF A PROFITABLE VENTURE

In the ceramic manufacturing industry, RAK Ceramics has made its mark by offering premium high-end products to consumers. In conversation with Yamini Sunwar, Sudhir Malesha, CEO, RAK Ceramics, shares his experience in the industry and talks about his plan

In the ceramic manufacturing industry, RAK Ceramics has made its mark by offering premium high-end products to consumers. In conversation with Yamini Sunwar, Sudhir Malesha, CEO, RAK Ceramics, shares his experience in the industry and talks about his plans for the brand's expansion.

Take us through the brand's journey so far.

RAK is a young company, as it was founded in 1991, in the UAE. The company has nurtured its mission of producing the world's finest quality tiles over the past 20 years. We are the only company to offer 10 variants of vitrified tiles in India and have an extensive range of products with over 8000 designs. Seeing a shortage of supply over the demand for tiles, the brand opened a manufacturing plant in India, in 2004. From then, the company has widened its reach in the country.

Why do you think dealership is an apt business model for your brand?

A company showroom cannot be built everywhere as the requirements vary from place to place. Also, a single showroom in a city may not be accessible to all consumers. Thus, the idea of having dealers at different locations in a city or town helps reduce costs and serves as per the needs of the specific place. It is also an apt business model as the stakeholders in the construction industry tend to have a fixed set of vendors or dealers through which they source their material.

Discuss the market size of ceramic product industry in India? Tell us about the places where you are currently present.

The size of the Indian tile market is nearly Rs15,000 crore and is growing by nearly 30% annually. It is largely unorganised. But within 10 years, we have 7% of the total market share and our share is increasing every year. Since our inception, we have been a strong player in the Western and Southern parts of India. We have also grown in the Eastern and Northern zones. With five exclusive company showrooms and 1000 dealer showrooms across the country, we are planning roll out in tier-II cities and towns in both privilege store and shop-in-shop formats.

What challenges do you face in the business operations of ceramic products in India?

Logistics poses the biggest challenge, as our country still does not have a world class infrastructure for transport. Thus, having dealers in our channel helps us reach where we cannot reach directly.

What kind of training and support do you provide for your dealers?

We provide adequate business opportunities and support for our dealers in terms of marketing, product samples, support in fixture and furniture, and regular dealer meetings with esteemed architects and well-known faces of the fraternity. We also give them inputs on the general happenings in the industry.

Distributor/dealer facts:

  • Total turnover: Rs 450 crore
  • Area required: 300-1,500 sq ft
  • Location: Tier- II cities & towns
  • No of dealers: 1000
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