Ceramic Tiles Industry Research Project

Management Research Project On Ceramic Tiles Industry
1. Product market description

Ceramic Tiles
The term Ceramic tiles are rather loose one in as much as a number of tiling and paving product are included in the description. Ceramic wall tiles made from slip the same material figurines are made from: monoculture floor tiles: rock hard porcelain tiles and mosaic tiles made either from porcelain or clay are some of the verities called ceramic tiles. In other way it can be defined as, A Ceramic tiles is nothing but a mixture of clay and other minerals, which have been shaped and fired under high temperature to from a hard body, called bisque Every region of the world produces a unique type of clay with its own combination of hardness, color, texture, etc. The raw material provides strength and stability to the bisque and clay provides the density. The inherent advantage of clay is that it is mould able when wet but hardens when backed or fired. Glass may be fused to the bisque using intense heat. This process is called glazing. A tiles may also be left unglazed tiles is 20 percent more expensive. Glazing lends a wide spectrum of color and design to the tiles. It also be makes them strain resistant by forming a non-porous surface over the tiles. The breakthrough development in tiles manufacturing has come with the monoculture technology, which in Italian means single-fired. This process shapes, fires and glazes tiles in one step. Tiles which had to be baked in kilns for days together in the monoculture era can now are produced in less than a company. Thus the time of production has been drastically reduced, resulting in sizeable savings in the cost of production. The monoculture tiles also have better destiny and harder glaze than tiles produced by other method has been drastically reduced. Resulting in sizeable saving in the cost of production. There are many different tiles on the market, such as frost and heat resistant tiles, small tiles, quarry tiles, and tiles designed with a rough surface to absorb heat from sunlight and radiate the heat back into the room. Vitreous and Monocuttura tiles are the frost and heat resistant tiles and some of the hardest tiles market. Mosaic tiles are 2 inches come mounted on paper for easy installation. Quarry tiles come in different colors, such as orange and in various sizes and thickness. It is frost and heat resistant, impervious to grease liquids, and moisture, easy to NSVKMS MBA College Visnagar 1
care for, and very durable. Quarry tiles come with or without a glaze. It can however, be ordered pre-waxed for easy grouting when using epoxy grout. The prewar is not permanent. Some of the imported tiles are often confused with quarry because of the clay color however imported tiles are available in glazed and unglazed. Ceramic tiles come in different design and finishes. The design varies from soft texture to deep design impression. Tiles are available in high-gloss mat duraglaze
Constituents of Ceramic tiles:

In general there are basically company variety / segments in the Ceramic tiles 1. 2. 3. 4. Floor tiles. wall tiles vitrified tiles porcelain tiles
For the production of all the above the contiguous are used are generally same, they are clay send zircon and feldspar other metals {Fe (iron), Pb (plum bum), c (carbon) But in case of vitrified tiles glass is also being used as an Ingredient. In case of porcelain tiles the ration porcelain is higher compare to clay. The amount of porcelain present is approximately 37%.
Table 1.1 Clay Sand Feldspar Other materials 57% 28% 10% 5%
percentage of constituents
10%
5%
Clay Sand 57% Feldspar Other materials
28%
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What is ceramic?
Ceramics are classified as inorganic and nonmetallic materials that are essential to our daily lifestyle. Ceramic and materials engineers are the people who design the processes in which these products can be made, create new types of ceramic products, and find different uses for ceramic products in everyday life. Ceramics are all around us. This category of materials includes things like tile, bricks, plates, glass, and toilets. Ceramics can be found in products like watches (quartz tuning forks-the time keeping devices in watches), snow skies (piezoelectric-ceramics that stress when a voltage is applied to them), automobiles (sparkplugs and ceramic engine parts found in racecars), and phone lines. They can also be found on space shuttles, appliances (enamel coatings), and airplanes (nose cones). Depending on their method of formation, ceramics can be dense or lightweight. Typically, they will demonstrate excellent strength and hardness properties; however, they are often brittle in nature. Ceramics can also be formed to serve as electrically conductive materials, objects allowing electricity to pass through their mass, or insulators, materials preventing the flow of electricity. Some ceramics, like superconductors, also display magnetic properties. Ceramics are generally made by taking mixtures of clay, earthen elements, powders, and water and shaping them into desired forms. Once the ceramic has been shaped, it is fired in a high temperature oven known as a kiln. Often, ceramics are covered in decorative, waterproof, paint-like substances known as glazes.
Ceramic Segments:
INDUSTRY SEGMENT Structural clay products White wares Refractoriness
COMMON EXAMPLES Brick, sewer pipe, roofing tile, clay floor and wall tile (i.e., quarry tile), flue linings Dinnerware, floor and wall tile, sanitary ware, electrical porcelain, decorative ceramics Brick and monolithic products are used in iron and steel, nonferrous metals, glass, cements, ceramics, energy conversion, petroleum, and chemicals industries Flat glass (windows), container glass (bottles), pressed and blown glass (dinnerware), glass fibers (home insulation), and advanced/specialty glass (optical fibers) Natural (garnet, diamond, etc.) and synthetic (silicon carbide, diamond, fused alumina, etc.) abrasives are used for grinding, cutting, polishing, lapping, or pressure blasting of materials Used to produce concrete roads, bridges, buildings, dams, and the like Wear parts, bio ceramics, cutting tools, and engine components Capacitors, insulators, substrates, integrated circuit packages, piezoelectric, magnets and superconductors Engine components, cutting tools, and industrial wear parts
Glasses
Abrasives
Cements Advanced ceramics Structural Electrical
Coatings
Chemical and environmental Filters, membranes, catalysts, and catalyst supports
Most of the above segments can be further broken down into more specific product classifications as seen on the table below. In 1974, the U.S. market for the ceramic industry was estimated at $20 million. Today, the U.S. market is estimated to be over $35 billion.
Structure and Properties of Industries:

The properties of ceramic materials, like all materials, are dictated by the types of atoms present, the types of bonding between the atoms, and the way the atoms are packed together. This is known as the atomic scale structure. Most ceramics are made up of two or more elements. This is called a compound. For example, alumina (Al2O3) is a compound made up of aluminum atoms and oxygen atoms. The atoms in ceramic materials are held together by a chemical bond. The two most common chemical bonds for ceramic materials are covalent and ionic. For metals, the chemical bond is called the metallic bond. The bonding of atoms together is much stronger in covalent and ionic bonding than in metallic. That is why, generally speaking, metals are ductile and ceramics are brittle. Another structure that plays an important factor in the final property of a material is called microstructure. The microstructure of a material is the structure that can be seen using a microscope, but seldom with the naked eye. For ceramics, the microstructure can be entirely glassy (glasses only); entirely crystalline; or a combination of crystalline and glassy. In the last case, the glassy phase usually surrounds small crystals, bonding them together. The atomic structure primarily affects the chemical, physical, thermal, electrical, magnetic, and optical properties. The microstructure also can affect these properties but has its major effect on mechanical properties and on the rate of chemical reaction. Due to ceramic materials wide range of properties, they are used for a multitude of applications. In general, most ceramics are: Hard, Wear-resistant, Brittle, Refractory, Thermal insulators, Electrical insulators, Nonmagnetic, Oxidation resistant, Prone to thermal shock, and Chemically stable. Of course there are many exceptions to these generalizations. For example, borosilicate glasses (glasses that contain silica and boron as major ingredients) and certain glass ceramics (glasses that contain a crystalline phase) and NZP ceramics are very resistant to thermal shock and are used in applications such as ovenware, stove tops and kiln furniture NSVKMS MBA College Visnagar 5
respectively. Also, some ceramics are excellent electrical conductors and an entire commercial market is based on the fact that certain ceramics (ferrites) are magnetic.
Various types of tiles and their characteristics:

The various types of tiles include earthenware tile, stoneware tile and porcelain tiles. Earthen ware tiles are company for interior use, while porcelain and stoneware tile are preferred for exterior use. EARTHWARE TILES: Porous tiles result in higher absorption of moisture Produce the good sound of tapping. Moisture absorption 22% or less Usually are unglazed. STONEWARE TILES: Lacks clarity of the ceramic tiles. Low moisture absorption They are glazed and unglazed even About 1-5% of moisture is being absorbed. PORCELAIN TILES: Metallic sound and good clarity is there Absorption level is about 0-1%. They are usually glazed and unglazed. USAGE BASED CLASSIFICATION: Based on the use of the ceramic tiles they are being classified as wall tiles, generally used foe the walls of the kitchen, bathrooms etc. the floor tiles used to apply them to the floor of swimming pools, basins, bathrooms, toilets and kitchen. The latest is the trend of the vitrified tiles, which have a glass like shine and strength compared to the marble and granite. Wall tiles: Ceramic wall tiles are normally less durable than tiles designed specifically for flooring. Most wall tiles are glazes with a semi-gloss or matte surface. The glazed surface has a very low slip resistance and become , slippery when wet therefore, glazed wall tiles is much more suited for wall or countertop application rather than floor tiles.
Glazed ceramic tiles: Glazed ceramic tile is comprised of two basic elements, clay and water. Various clay is mined. Ground and blended to a fine powder, and pressed together to from the body of tile. The pressed clay body is then dried to reduce the moisture content. Next the surface of the tile is coated with a colored. The glaze is then permanently fused to the surface of the tiles by firing it in kilns are approximately 2000 Fahrenheit to form the finished product. Porcelain tiles: Porcelain tiles are made from a blend of fine grain clays and other minerals to produce a very dense body. Which makes it highly resistant to moisture, staining and wear? Because of these features, porcelain tiles will withstand years of heavy foot traffic in both interior and exterior application application while maintaining its color and beauty. Color body porcelain tiles: This is the densest of all tiles types, color body porcelain tile has a through color and is defined by its ⁢ 0 5% water absorption. These tiles can withstand heavy foot traffic and are suitable for either indoor or outdoor application. To determine the overall performance and durability of the glazed surface of ceramic tiles, there are standardized industry tests and classification which rate tiles specifically resistance to scratching, breaking, abrasion moisture etc. Scratch hardness: Most tiles are rated for hardness or scratched resistance using the MOHS test and rating system the MOHS test rates tiles from 1 to 10. Ceramic tiles with a value of 5 or more is suitable for most normally acceptable for most commercial application or heavy traffic areas. Wear resting: To help select suitable tiles for specific application tiles are rated the P.E.I. (porcelain Enamel institute) scale. The tiles are evaluated for wear resistance on a scale from 1 (lowest) to 5 (highest). 1. Light traffic- recommend for residential bathrooms or other areas with light traffic and where shoes are not frequently used. 2. Medium traffic- recommended for residential interiors, except entryways, into contact with grave or sand 3. Medium heavy traffic recommended for all residential interior and light commercial application. Not recommended for commercial entryway. 4. Heavy traffic- suitable for all residential interiors and most commercial application, including shopping malls and public areas. 5. Heavy-plus traffic- all residential and commercial areas where heavy- duty ability is needed. NSVKMS MBA College Visnagar 7
Water absorption: ceramic tiles are also classified by their water absorption rate which reflects the density of the body of the tiles there is a direct relationship to the water absorption rate and the suitable of the various types of tiles for interior or exterior application. Tiles suitable for exterior application must have a very low water absorption rate. Especially in climate subject to freezing which have a moisture absorption rating of less than 5%. Shading: like the nature products themselves will very in shading this adds to the beauty and design of the product. When choosing a tile its best to views 2-3 tiles together to visually determine the overall appearance of the tiles.
2.Tile manufacturing process

The tile manufacturing process has mainly company routes Tunnel Bisque and tunnel glost firing ; it is the oldest manufacturing process for the tiles. The advantage of this process is that it cans very small size to medium size tiles. The other processes are not geared up to handle such process.
Tunnel Bisquet and roller glost firing ; the main advantage of this route when compared to the previous is that it can produce very large size products, which can not be made in the tunnel route of manufacturing. Single roller firing; this is the mossy mordent technology in the production of tiles today. The advantages are higher are higher productivity lower fuel consumption and reduced losses. Rolier rolier firing or double fast firing: the advantage of this technology is that tiles better surfaces can be produced.
Ceramic tiles manufacturing process:
Ceramic tiles raw material:

The majority of raw materials used by the ceramic industry are the oxides of metals. The three metals which have been the mainstays of the industry for many years are clay, flint, and feldspar. These are the major materials contained in what is sometimes referred to in the industry as "classical ceramic bodies." Clay : Clays are hydrated aluminosilicates and are the end-product of the weathering of fields pathos rock. The most important clay mineral is Kaolinite which has the composition AL2O3 - 2SiO2 - 2H2O. Clay is the material that gives a ceramic composition the plasticity which facilitates the fabrication of the material into the desired form prior to heat-treating. Flint Flint is a form of silicon dioxide (SiO2) usually produced from quartzite, sand or rock. It is used in a finely pulverized form as a filler to give the clay and final product the desired properties. Feldspar Feldspar is a broad, generic name applied to a group of alkali-aluminosilicates. For example, feldspars in which the alkali is potassium (K2O - Al2O3 - 6SiO2) are called "potash feldspars," and those containing sodium (Na2O - Al2O3 - 6SiO2) are called "soda feldspars." Most feldspar, however, are combinations of these two types. Feldspar is used and known as a "flux" in the ceramic industry. The flux is the material which starts to melt at the lowest temperature during the heat-treating process, thereby acting as the cementing element which gives the ceramic body its strength. A great many other naturally-occurring minerals and some synthetically produced chemicals are used as raw materials by the ceramic industry. A few of the more important ones, along with their chemical formulas, are now presented:
Annexure I - List Of Materials Classified As Raw Materials

S.N ITEM o DESCRIPTION 1 Ceramic color, Pigments 2 Printing Bases 3 4 5 6 7 8 9 CTH CET CURRENT RATE OF 3207. 30% DUTY 9 3207. 30% 9 3207. 30% 1 2840 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 25% 25% 25% 25% 25% 25% TYPE Raw material Raw material Raw material Raw material Raw material Raw material Raw REMARKS Used for long lasting Same as above Used to improve the Used to tile body improve Used to the improve Used to the improve the Same as above
3207. 1 3207. 1 Compound, 3207. Frit, 4 Borax Pentahydrate 2840. Matt.Powder, 19 2810 Boric Acid 2810 CMC
3912. 3912. 31 3207. 31 Granito Body Stain 3207. 1 9 Soluble Salts 3210 3210 Abrasives 3207 6804. 22 6804. 22 2817 3207 6801. 1 6801. 1 2817
10 Diamond cutting 11 tools Zinc Oxide, 12 Wollastonite Cal. Carbonate 13 Alumina Baco, Corundrum 14 Probitol 15 STPP 16 Binding Material 17 Kavolin 18 BWS Clay 19 Silica 20 Feldspar 21 Quartz 22 Ukraine Clay
material Raw Same as above material Raw Used in material polishing Raw Used in material Raw manufacture Used to material Raw material Raw material Raw material Raw material Raw material Raw material Raw material Raw material Raw material Raw improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the improve Used to the
2836. 2836. 5 9 2818. 2818. 1 9 3912. 3912. 31 2835. 31 2835. 31 3824. 31 3824. 9 9 2507 NIL 2508. NIL 4 2505. 2505 1 2529. 2836. 1 9 2506. NIL 1 2508. NIL 4
material Raw improve Used to the material improve the
Raw Materials Listing in Ceramic tiles:
Naturally Occurring (Chemical Composition) Clay (Al2O3 - 2SiO2 - 2H2O) Feldspar (K2O or Na2O - Al2O3 - 6SiO2) Flint (SiO2) Whiting (CaCO3) Magnetite (MgCO3) Talc (3MgO - 4Si2 - H2O) Nepheline Syenite (K2O - 3Na2O - 4Al2O3 9SiO2 + Feldspar) Zircon (ZrO2 - SiO2) Silicone Carbide (SiC) Borax (Na2O - 2B2O3 - 10H2O) Titanium Carbide (TiC) Pyrophyllite (Al2O3 - 4SiO2 - H2O) Boron Nitride (BN) Spodumene (Li2O3 - Al2O3 - 6SiO2) Cobalt Oxide (CoO) Beryl (BeO - Al2O3 - 6SiO2) Artifically Produced (Chemical Composition) Alumina (Al2O3) Litharge (PbO) Zinc Oxide (ZnO) Tin Oxide (SnO2) Barium Titanate (BaO TiO2) Lead Zirconate (PbO ZrO2) Iron Oxide (Fe2O3)
3. Substitutes Of The Ceramic Tiles

The use of the tile is being from 4000 years. But today seeing to the size and designs in them we find that lot many of innovations are being down. Hard Cover Flooring Is Divided Into Two SUBDIVISION: PROCESSED FLOOR COVERIBG:
A) agglomerated stones B) terrazzo tiles C) concrete paving stones
NATURAL FLOOR COVERING Natural stone (e.g. marble, granite)
Therefore it can be very well under stood from various options for the flooring in case of substitution to the ceramic tiles. So in case of the various substitutes available we find that marble, granite, terrazzo tiles. Kostas stone dholpuri stones are various highly favored in context to the ceramic tiles.
4. History of the ceramic tiles

Rumors have it that the first clay tiles were produced seven to eight thousand years ago in the area now known as the Holy Land. Many companies independently verify that the actual known history of Tiles (and the known usage of wall and floor tile coverings) can be traced back as far as the company millennium BC (4000 BC) to Egypt.
In those days, in Egypt, tiles were used to decorate various houses. Clay bricks were dried beneath the sun or baked, and the first glazes were blue in color and were made from copper, very exquisite! During that period ceramics were also known to be found in Mesopotamia. These ceramics bore decorations, which were white and blue striped and later possessed more varied patterns and colors. Later on, in China too, the great center of ceramic art, a fine, white stoneware with the earliest Chinese glaze was produced during the Shang-Yin dynasty (1523-1028 BC). The usage and the art of making and decorating ceramic tiles had spread and by 900 A.D., decorative tiles had become widely used in Persia, Syria, and Turkey and across North Africa. As transport and communication developed, tile usage and its penetration in other territories increased. Wars and territory take-overs caused this art to spread even faster. The Romans introduced tile making in Western Europe as they occupied territories. The Low Countries of Northern Europe somehow acquired the technology from Persia, while the Moors brought African tiles with them when they invaded Iberia (Spain). It was aboard the ships of Spanish conquistadors that decorative clay tiles found their way to the New World, where they were used primarily to decorate the Churches of newly built missions. By the end of the 12th century, use and manufacture of Ceramic Tiles had spread across Italy and Spain and into the rest of Europe. Till that time they were mainly used to decorate the floors of Cathedrals and Churches. The skill had eventually vanished from Europe in the 16th century following the reformation. But the decorative wall tile art had survived in Turkey and the Middle East and the Delft tiles art survived in Holland. A form of tile making had also evolved among the natives of North and South America at some point. The first decorative tiles to appear in Colonial North America were imported from Northern Europe, mainly England the Brits having hijacked the technology from the Dutch. The tiles were too expensive for utilitarian purposes in the Colonies and were found almost exclusively in the homes of the wealthy. NSVKMS MBA College Visnagar 14
Through the centuries, tile decoration was improved upon, as were methods of tile manufacture. For example, during the Islamic period, all methods of tile decoration were brought to perfection in Persia. Throughout the known world, in various countries and cities, Ceramic tile production and decoration reached great heights. The tile mosaics of Spain and Portugal, the floor tiles of Renaissance Italy, the faiences of Antwerp, the development of tile iconography in the Netherlands, and the Ceramic tiles of Germany are all prominent landmarks in the history of Ceramic tile. In the early days, the tiles were hand-made, each tile was hand-formed and hand-painted, and thus each was a work of art in its own right. Ceramic tile was used almost everywhere on walls, floors, ceilings, fireplaces, in murals, and as an exterior cladding on buildings. Today Ceramic tile throughout the world is not hand-made or hand-painted for the most part. Automated manufacturing techniques are used and the human hand does not enter into the picture until it is time to install the tile. They are used in an almost infinite number of ways and you dont have to consider yourself company wealthy to own them. In commercial buildings, where both beauty and durability are considerations, ceramic tiles will be found, particularly in lobby areas and restrooms. In fact most modern houses throughout use Ceramic tiles for their bathrooms and kitchens and in every vital area of the premise. Ceramic tiles are also the choice of industry, where walls and floors must resist chemicals. And the Space Shuttle never leaves Earth without its protective jacket of high-tech, heat resistant tiles.
Ceramic tiles industry in india:

Industry Highlights
Ceramic Tiles today have become an integral part of home improvement. It can make a huge difference to the way company interiors and outdoors look and express. The Indian tile industry, despite an overall slowdown of the economy, continues to grow at a healthy 15% per annum. Investments in the last 5 years have aggregated over Rs. 2000 cores and production during 2006-07 stood at approx. 340 million sq mts. The Indian tile industry is divided into organized and unorganized sector. The organized sector comprises of approximately 16 players. The current size of the unorganized sector is about Rs 3000 cores The unorganized sector accounts for 55% of the total industry bearing testimony of the attractive returns from this sector. The size of the unorganized sector is approximately Rs 3500 cores Revenue earning industry - excise mops up over Rs. 350 cores annually from the organized sector itself.
Indian ranks in the top 5 list of countries in terms of tile production in the world. With proper planning and better quality control company exports (presently insignificant) contribution can significantly increase.
Background Apart from their decorative looks, Ceramic Tiles are primarily hygiene products and that is how company broad spectrum of consumers views the product. This is fairly evident from its varied usage from bathrooms and kitchens in average Indian households to medical centers, labs, milk booths, schools, public conveniences, shopping malls and numerous other centers; which dot company day to day life. A ceramic tile is basically a "utility product" and that remains company promotional slogan. Popular housing projects are increasingly switching over to Ceramic Tiles moving away from the traditional use mosaic and even granite or marble, owing to several factors viz. ease in laying ability, versatility, low price and hygiene. Nevertheless, this decorative aspect of a Ceramic Tiles has forever been in the forefront. Heavy churning out of bolder and colorful designs by the industry are testament to the fact that most households regard a ceramic tile as an "adornment" for an otherwise "drab look" of their age-old floorings or an unfurnished wall. Overall picture of the Industry Ceramic tiles as a product segment has grown to a sizeable chunk today at 340 Millions Square meters production per annum. However, the potential seems to be great, particularly as the housing sector, retail, IT & BPO sectors have been witnessing an unprecedented boom in recent times. The ceramic tiles sector has been clocking a robust growth of 12-15% consistently over the last few years. Today, India figures in the top 5 countries in the world manufacturing ceramic tiles. The key drivers for the ceramic tiles in India are the boom in housing sector coupled by government policies fuelling strong growth in housing sector. The retail boom in the Indian economy has also influenced the demand for higher end products. Overall the bullish growth estimates in the Indian economy has significantly influenced the growth of the Indian Ceramic tile industry. The main product segments are the Wall tile, Floor tile, Vitrified tile and Porcelain tile segments. The market shares are 35%, 53% and 12% respectively for Wall, Floor & Vitrified/Porcelain tiles. The tiles are available in a wide variety of designs, textures and surface effects. They cater to tastes as varied from rustics to contemporary marble designs in super glossy mirror finishes. Both, traditional methods of manufacturing (tunnel) and the latest single fast firing methods are deployed in manufacturing. Some of the latest trends in manufacturing methods can be seen in India.
The investments in the last five years are approx. Rs 2000 cores. The industry also enjoys the unique distinction of being highly indigenous with an abundance of raw materials, technical skills, infrastructural facilities despite being fairly capital intensive. A total of over 5, 50,000 people are employed in the sector. Out of this, 50,000 people are directly employed and 5, 00,000 are indirectly associated. The potential is huge considering the per capita consumption of ceramic tiles in India. Currently it is at 0.30 square meters per person in comparison to over 2 square meters per person for like countries like China, Brazil and Malaysia Where we stand and what we must do? As a foreign exchange earner or a global player, Indian Tile industry has captured the attention of the world in the ceramic tiles segment. India is projected to figure in the top 3 countries manufacturing ceramic tiles by 2010. This however is subject to policies favorable for the tile industry to complete with international players on an even ground. To compete internationally, company plants must be geared up to large units currently operating in China and Turkey is driven by economies of scale. These will also help us in lowering company cost of production significantly. Also, infrastructural support is a key factor that determines the speed of growth. Better infrastructure will bring in better growth in terms of consistency and sustenance. Freight, supply of power and gas remains the key cost-related issues impacting the industry. Availability, consistent supply and reasonable rates are extremely important for the growth of the ceramic tile industry. Also, the prevailing anomalies pertaining to Basic Customs Duty on import of ceramic tiles from China and raw materials imported from abroad need to be corrected to prevent dumping of tiles from China. Rural thrust should be enhanced by favorable excise duty and MRP structure Current status of the Industry The ceramic tiles industry in India has followed similar trends internationally which have been characterized by excess capacities and falling margins. Countries like Malaysia, Thailand, Indonesia, Sri Lanka and Vietnam are setting up their own plants. China has emerged as a major competitor. Producers from Spain and Italy have the advantage of lower transportation costs while exporting to USA and Germany. In India, the per capita consumption is as low as 0.30 square meters per person compared to China (2 square meters per person), Europe (5 to 6 square meters per person) or Brazil (2.5 square meters per person). Rising disposable incomes of the growing middle class and 40 million units of housing shortage hold out a great potential.
A major change that took over the ceramic tiles industry, was the introduction of vitrified and porcelain tiles. These new entrant product types are said to be the tiles of the future. Internationally these tiles are already the major sellers. This category of products account for 13% of all organized sales in this industry. These new products and the conventional wall & floor tiles have together made the organized industry grow to a formidable Rs. 3000 cores industry. This coupled with a spate of expansions by many players make the industry look very promising in the future. The Indian Industry has developed an export market although at the lower end. In volume it constitutes less than half a percent of the global market. (Presently India does not figure in the list of major exporting countries). But this reality could change as Indian exports are rising at the rate of 15% per annum. The top-end of the global export market is presently dominated by Italy (40.8%) and Spain (26.4%). (Company: Compiled using information from Corporate Catalyst India, ASCER and other associations.)
5. PRODUCT LIFE CYCLE:

The Product Life Cycle Is Concerned With The Sales History Of A Product or product class. The concept holds that of product sales change over times in a predictable way and product go through a series of five distinct sages: 1) 2) 3) 4) 5) introduction stage growth stage shake out stage maturity stage decline stage
But the CERAMIC TILES has undergone its introduction and growth stage, at present it is its shake out stage this is very clear from the characteristic it is following. 1) The market growth for the industry is leveling off it can be said that the growth is steady maintained. 2) The segment varies from few to large number. There are continuous innovation brought about for various purposes with a proper mass to be targeted e.g. joint free tiles or anti slip tiles according to purpose of good look and safety purpose. 3) The competitors are good in number but are getting reduced for certain laws like WTO, hence weaker are leaving off the market and few are acquired but big giants thereby increasing the capacity. 4) The pricing policy has been rationalized because different brand come up with newer and newer concepts in the market to sustain the market share it is an essential step. 5) The distribution network is being made strong. The dealers, sub dealers, distribution are raised up in their number to make the availability of the product easier and higher. These step followed every strongly playing firm in the market. The promotion of the product has been also enhanced by increasing or adding to the number of showrooms for proper understanding the usage of the tiles in contrast to its substitutes.
6. Application of the ceramic tiles:

Historically, man has desired to create living spaces. Which were beautiful, durable and user friendly? With that in mind has made ceramic tiles 4000 years. Ceramic tiles have been valued for their beauty and durable for centuries. In the ancient civilization of Egypt, Greece and Rome. Tiles were used as a function material and as decoration in the houses of the most important citizen as well as public buildings such as baths and temples. The fact that when these building are excavated the tiled floor is still intact which a testament to the durability of ceramic tiles is. Ceramic tiles, particular floor tiles are once again at the very height of fashion. People are choosing ceramic tiles for many reasons. To start with hard flooring is now more popular than carpet and ceramic is the most durable of domestic hard flooring. A tiled floor should last for many years. Ceramic tiles are very safe, they are non-flammable and do not conduct electricity. They are hygienic and do not attract or absorb dirt and they are very easy to clean. They are also healthy and ideal for those with asthma or allergies as they do not harbor dust, pollen, dust mites, or cancer- causing benzene from car fumes. Ceramic tiles are very comfortable under foot. They have thermal insulation and soundproofing qualities. They are not cold; actually absorb and retain heat like mini storage heaters. They are also odor. But above all ceramic tiles are attractive. There is nothing that quite transforms a room like tiles and tiles will also add value to company home. Its a building material as ancient as the clay harvested from the Nile River and as futuristic as the thermal glass used protects todays space shuttles. Area of application 1) esthetic value 2) surface subjected to wear and tear 3) Under water/for flashing purpose. Initially they ware only used for the flooring purpose, but gradually with the creation of glazed ceramic tiles they are used for cladding of walls in baths, toilets and kitchen as well as in decorative purpose. They are used in swimming pools and some water carrying bodies because of its water resistance and durability. Not only on an average in the India household but it is covering even the medical centers, labs, milk booths, schools. Public conveniences and countless other centers surrounding us. NSVKMS MBA College Visnagar 21
The presently devised porcelain tiles and varied tiles just picked up the one third of the ceramic tiles market. It has really pushed back the mosaic tiles flooring. Housing sector is connected to the overall growth in the economy. It has as witness significant growth during the last few years due to decline interest cost, steady real estate prices. Increased urbanization and fiscal incentive growth provided for tax purpose. The housing sector is set to grow at an annual rate of 50% for the next 4 years. Due to decline in demand for funds from industry side. The retail finance boom in the banking sector, the price war to acquire critical mass have helped more people to decline in demand for funds from industry side, the retail finance boom in the banking sector and the price war to acquire critical mass have helped more people to afford home loans. The rising salaries in telecom. It, banking coupled with cheaper availabilities of finance has turned more people debt friendly. The main driver in the commercial market segment has been IT companies, blotech companies and BPO.
7. Major Players In The Ceramic Industry In India
Asian Granito (I) Ltd

Asian Granito is one of the largest ISO 9001 Certified vitrified tiles manufacturers in India. Asian has two state-of-the-art manufacturing plants, technically collaborated with SACMI, ITALY, the world class leader in ceramic technology. They have extensive network of business associates, 250 distributors, more then 3500 retail counters and 19 depots in all over India. The company has won 20 best display awards till date.
Gladder Ceramics Limited Manufacturer of Ceramic Floor Tiles with advanced technology Roller Kiln, Superior Raw Materials Enduring Ceramic Colours characterize the Floor Tiles manufactured by India's Gladder Ceramics Limited for Export.
Kajaria Ceramics - Wall and Floor Tiles. Kajaria Ceramics manufactures the widest range of floor and wall ceramic tiles to provide the complete wall and floor solutions.
Nitco Group - Nitco Tiles. The Nitco Group is a pioneer in the manufacture of high quality mosaic and terrazzo tiles and is also one of the leading manufacturers of exterior paints and the largest processors of Italian Marble in India.
SOMANY Floor and Wall Tiles. The group's activities include ceramic glazed tiles, sanitary ware, glass containers, textiles and sanitary fittings. The group has launched a new range of vitrified tiles called greviti, in collaboration with Leonardo 1502 Ceramic Spa.
Sonata Floor Tiles Sonata is in involved in manufacturing of state of art masterpieces in ceramic industry. Having its production based in ancient town of Himatnagar, Sonata Ceramic Pvt. Ltd. is one of the most advance ceramic product manufacturers in India.
Varmora Granito Pvt Ltd Vermora has commissioned a fully automatic Italian plant for manufacturing floor tiles, wall tiles, porcelain tiles and vitrified tiles. The company offers a complete range of tile products using state-of-the-art manufacturing facilities with re-assuring quality checks. Encouraged by favorable market response to floor tiles, the company has now enhanced its skill and technology at production and marketing of floor tiles.
Other Ceramic Company:
Anant Raj Industries Ltd Bally Glass & Ceramics Cera Sanitaryware Ltd English Indian Clays Ltd Fag Bearings India Ltd Hindustan Sanitaryware & Industries Ltd Kajaria Ceramics Ltd Mangalam Industrial Products Murudeshwar Ceramics Limited NTB Hitech Ceramics Navrang Ceramic Orient Ceramics & Industries Ltd Rautec Ceramics Private Limited Regency Ceramics Ltd Restile Ceramics Ltd SPL Ltd Spartek Ceramics India Ltd Sri Satya Prabha Enterprises Sunny Cera Colours
Geographical Presence of Ceramic Tile Industries in India:
Floor and wall tiles:

Bathroom Wall Tiles:
Kitchen Wall Tiles:
8. Global characteristics:
The ceramic tiles industry has facts like:
1) Countries like Malaysia, Thailand, Indonesia, Shrilanka and Vietnam are setting up their own plants. 2) China is emerging as the leading producer. 3) Producers of thru Spain and Italy beneficial because of the lower transportation cost for the exports to the countries like U.S.A. and GERMANY. 4) In India per capital consumption is No.1 sum while comparison it is 3 to 5 sqm in China and Europe. 5) The top end of the global export is dominated by Italy and Spain. 6) The top end of the highest per capital consumption per sqm is handed to Portugal and Spain. 7) The world top producing countries for the ceramic tiles are Spain and Italy. 8) Being a large continent with many as 3 countries marketing product and services in African countries is indeed a challenging task. However for a successful marketing effort it is an imperative to identify and association with reliable and efficient business partners in key African countries. A good starting point is via an organization that especially in marketing and business. Promotional in African market. Another tool to search for business association in African countries is the internet. Conclusion can be made over there above global information that among the various countries Italy and Spain are the highly qualified competitors.
9. Details about the globe:

Now in details referring to the countries producing consuming and exporting well the ceramic tiles is being discussed well. Here important is given to the Europe since Spain and Italy are the major producers of the ceramic tiles, then America United kingdom and Germany are been referred. Among Asian countries Japan is been referred. The republic Macedonia is newly rising with good amenities for the development of ceramic tiles industry. European tile industry: EUROPEAN PER ANNUM CONSUMPTION 5-6SQM EUROPEAN TURNOVER IN WORLD-52% EUROPEAN CONTRIBUTION-37% EUROPEAN CONSUMPTION-40% EUROPEAN COUNTRIES MAIN PRODUCERS-SPAIN,ITALY
1)
The European Union is the worldwide leaders: in ceramic product manufacturing in term of design quality, internationalizing and added value of the products. While China is world leaders in production volume with more than 2000 million square meters produced in 2002. The Italian and Spanish companies are world leaders in ceramic tiles manufacturing, but there are excellent representative in other European. It is estimated the worlds production has reached in the 2000 year around 4000 million of square meters, where European contribution will be about the 37% of that total production. The existing dynamic of the world economy could unbalance the favorable company position of the European ceramic companies facing the threat of the Asian competitors, which have a strong boreal into the global market, due to their lower cost of workers or their less strict environment laws. Occasionally this unfair trade advantages could turn to dishonest competitors. Countries like China or even Brazil or Mexico could be in this
2)
3)
Market Trend In The World

The industrys revenue for the year 2006 was approximately $1,130,000,000. The gross profit was 43.4% at $490,420,000. There were 230 establishments in this industry that year. Thus, average contribution (or revenue) per establishment annually was $4,893,000. The total import export value for the year 2006 was $2,414,472,000. There were 105 countries that conducted foreign trade with the U.S. in 2006, 1 more than year 2005. The top trading countries were: Italy, $969,269,000 (40.14%); Spain, $345,204,000 (14.30%); Mexico, $279,343,000 (11.57%); Brazil, $252,174,000 (10.44%); and China, $203,993,000 (8.45%). Their combined total represents approximately 85% of all imports and exports. The total import value for the year 2006 was $1,918,510,000. This represents a 6.6% increase from year 2005. The U.S. had imported industry related merchandises from 72 countries in 2006. The top importing countries were: Italy, $820,298,000 (42.76%); Spain, $275,077,000 (14.34%); Mexico, $247,449,000 (12.90%); Brazil, $190,103,000 (9.91%); and China, $136,361,000 (7.11%). Their combined total represents approximately 87% of import from all countries. The total export value for the year 2006 was $48,542,000. This represents a 1.8% increase from year 2005. The U.S. had exported industry related merchandises to 75 countries in 2006. The top exporting countries were: Canada, $28,208,000 (58.11%); Mexico, $10,256,000 (21.13%); Japan, $1,592,000 (3.28%); Bahamas, $783,000 (1.61%); and Korea, $677,000 (1.39%). Their combined total represents approximately 86% of export to all countries. Adding the import and subtracting the export, the total U.S. consumption value of this industry for the year was $3,000,000,000. This industry report packs 10 years of data from hundreds of reliable government and private statistical resources. The data have been compared and verified to assure the highest research quality. These agencies and private companies were frequently contacted to acquire the latest information, most of which is unavailable to the general public. It is estimated that to gather and organize the same information into an easy-to-read format in each report, an individual researcher would spend at least a years worth of effort. The challenge is, by the time this is accomplished, some data is most likely obsolete. Our business is dedicated to the research of U.S. industries and their associated foreign trades. We can meet that challenge easily as our databases are directly linked to these resources. NSVKMS MBA College Visnagar 32
The U.S. manufacturing sector is expected to hit the monumental 5 trillion dollars net sales in 2006. U.S. economists have projected another 5% to 7% growth in the year 2007. To stay ahead, this industry report is intended for you to analyze the specific U.S. industry in greater detail. Not only does the report provide you with information on domestic production, it also supplies you with an industrys import and export data. The report depicts what are the products of the industry and their respective contributions. You can compare these products with the industrys materials, parts and components list that is in the report. The foreign trade data includes 10-years of statistics, and it is projected into year 2008. Such trade data is also provided at the commodity level based on the HTS classification.
Turkey ceramic tiles industry:

Ceramics are amongst Turkeys oldest and best known products. The first notable ceramics from Turkish land were the tiles and bricks covered with colored glazes made in Anatolia for architectural purposes in the 13th Century. The Turkish classical art of Chinaware (ini in Turkish) is still famous throughout the world. Early Turkish tribes who lived in Central Asia made the first examples of this ceramic art for their kitchen and household use. Later, with the Seljuk movement this art came to Anatolia and became a decorative art piece, which was mostly used in the decoration of mosques, public libraries and Turkish baths. Despite the name of the art, which means Chinese style, it is originally a Turkish art. Commercial production of ceramics started in 1965 with foundation of the first technological plant in this field. Today, there are about 28 firms in the ceramic wall and floor tiles sector; 17 firms in the sanitary ware sector and eight in the households sector. Some 30 small scale ones also produce sanitary ware. There are hundreds of small workshops dealing in production in household articles subsector, as well. There are two companies in the technical ceramics sub-sector and some 10 companies in the refractory materials sub-sector. The major part of production belongs to ceramic wall and floor tiles in the ceramics industry. The second important group of items is sanitary ware and the third is household articles. Turkey ranks 5th in the world and 3 rd in the Europe in the production of ceramic tiles. It also ranks 3 rd in Europe and 4th in the world in the production of ceramic sanitary ware, as well. Turkey is the largest sanitary ware producer in Europe. The total production capacity of the sector is about 15 million units. Exports of the ceramic industry have been increasing steadily. In 2004 exports totaled to 639.8 million US dollars. Approximately 50% of the exports are directed to the EU countries. Turkey ranks 3 rd both in the world and in Europe in the exports of tiles following Italy and Spain. The second important group of products in the exports is sanitary ware. Turkey ranks 5th in Europe in the exports of sanitary ware following Italy, Germany, France and Spain. NSVKMS MBA College Visnagar 33
Turkish Production and Exports:
Turkish Exports by Sub-Sectors:
Turkish Ceramics:
Ceramics are amongst Turkey's oldest and best known products. The first notable ceramics from Turkish lands were the tiles and bricks covered with colored glazes made in Anatolia for architectural purposes in the 13th Century. Yet the history of Turkish ceramics can be traced back several thousand years. In the Seljuk and Ottoman Periods, ceramic art acquired new dimensions and pieces of exquisite beauty were produced. Commercial production of ceramics started in 1965 with the foundation of the first technological plant in this field. Today, there are about 30 establishments in the industry. Thirteen of them produce ceramic wall and floor tiles, eight produce sanitary ware. In the ceramic household articles sub-sector, there are 8 major companies as well as 250 small workshops engaged in production. There are three companies in this sub-sector dealing with production. There are two major companies in the technical ceramics sub-sector. The major part of production belongs to ceramic wall and floor tiles. The second important group of items in the production is sanitary ware and the third is household articles. Turkey ranks 5th in the world and 4th in Europe in the production of ceramic tiles. Turkey ranks 5th in Europe in the production of ceramic sanitary ware. Exports of the ceramic industry have been increasing steadily. Ceramic tiles constitute the major part of exports. Sanitary ware articles rank second and household articles and ornaments rank third in the total ceramics industry exports. Approximately 80% of exports are directed to EU countries. The major export countries are Germany, the United Kingdom, the USA, France and Israel.
Asian ceramic tiles industry:

Industrial Structure: Ceramic industry is an important industry supported and promoted by the government because it mostly uses domestic raw materials. The production of ceramic has used many labors and distributed income to local areas. In the past, the ceramic production was for substitution of import and then it had developed its technology continually until Thailand became one of the main ceramic manufacturers in Asia. This industry has generated income around Baht 20,000 million per year. Almost all of domestic ceramic production is for original ceramic. There are a few modern ceramic manufacturers who only import the finished raw materials from overseas for production. The ceramic production is not in complete cycle and must mainly depend on technology from the parent company. The production of original ceramic has been divided into 5 main groups as follows. 1) Floor-tile, wall-tile and mosaic: There are 12 manufacturers, with production capacity of 104 million squaremeters per year. These products require high investment, technology, and large and standard factories. The production for export is approximately 60% and distribution to domestic real estate business is approximately 40%. 2) Sanitary ware: There are 8 manufactures, with total production capacity of 160,000 tons per year. This product requires high investment, technology, and large and standard factories. The production for export is approximately 60% and distribution to domestic real estate business is approximately 40%. 3) Tableware: There are 68 manufacturers, with total production capacity of 126,000 tons per year. The production has emphasized on labors and designing knowledge. Mostly, there are medium and small factories and few large factories that can develop design and quality of products. The production has emphasized on export by 80% and domestic distribution by 20%. 4) Souvenir and ornaments: There are 123 manufactures, with total production capacity of 133,000 tons per year. These products have been produced by many labors and also focused on design. Mostly, there are medium and small factories. The production has emphasized on export by 80% and domestic distribution by 20%.
5) Electrical porcelain insulator: NSVKMS MBA College Visnagar 37
There are 10 manufactures, with total production capacity of 10,000 tons per year. This product requires high technology in production. The production is for electrical utilities by 90% and the rest is for export.
Industrial Conditions:
Production It is expected that the production of ceramic, floor-tile and wall-tile in 2007 would be around 100.58 million square-meters with the increased growth rate by 18.53% compared to 2006 that production volume is around 84.85 million square-meters. As a result of the government measures in stimulating the real estate sector especially reduction of transfer and mortgage fees that would expire in 2007, every entrepreneur in housing estate business needs to expedite the construction and transfer ownership right in time. Therefore, there is high expansion in the domestic real estate business and export markets especially U.S. and Asian markets. For sanitary ware, it is expected that the production volume would be around 6.06 million pieces, decreased by 1.25% compared to 2001 that the production volume is 6.14 million pieces because of the continuous decrease in the sanitary ware export to the main markets, U.S. and Hong Kong.
Marketing:
Domestic Market: In 2007, it is expected that the distribution volume of floor-tile and wall-tile is about 114.25 million square-meters increased by 21.25%, compared to last year of 94.22 million square-meters. For the distribution of sanitary ware, it is expected that its volume would be around 3.05 million pieces with an increased growth rate of 18.09% compared to year 2006 of 2.58 million pieces. The domestic distribution of ceramic especially floor-tile, wall-tile and sanitary ware has a good trend according to the expansion of real estate business. The main market would be the investment in the projects of constructing new houses, modifying and repairing old houses, and repairing houses after flooding in many provinces. For the competition in domestic market, floor-tile and wall-tile would be more competitive than sanitary ware especially price competition. The manufacturers have to develop their products to be more qualitative, beautiful and fashionable. The competition of sanitary ware would focus on developing the product quality and new products to meet the customer needs continually.
Export: The total export value of ceramic products in 2007 is expected to be around US$ 489.5 million and the growth rate would increase around 5.38% compared to year 2006 of US$ 464.5 million. Floor-tile, wall-tile, souvenir, ornaments, tableware and electrical porcelain insulators are expected to have growth rate of 34.28%, 22.22%, 14.64% and 6.19% respectively. Sanitary ware is expected to have a decreased growth rate of 6.93% according to export status to main markets such as U.S. and Hong Kong. The export of ceramic products is mainly to Japan, U.S., Great Britain, Australia, South Korea, Hong Kong, Germany and ASEAN countries, etc.2.2.3 Import The import value of ceramic products in 2007 is expected to be around US$ 121.0 million and the increased growth rate would be 14.37% compared to year 2006 of US$ 105.8 million. Most imported ceramic products are high quality and expensive, which cannot be produced in Thailand and have lower cost than local products. They have been imported from Japan, China, Malaysia, Germany, Italy, Indonesia, Singapore, Spain, U.S. and Taiwan, etc.
Trend:
The domestic ceramic production especially floor-tile and wall-tile tends to increase in line with the increase in production capacity of each factory and the domestic and international markets demand such as U.S. and ASEAN markets. Although a domestic distribution of sanitary ware has expanded in line with real estate market conditions, overall production might be stable in accordance with a decreasing export. The export of main ceramic products such as floor-tile, wall-tile, souvenir, ornaments, tableware and electrical porcelain insulator has increased in a good trend except sanitary ware that is affected directly by the main markets, U.S. and Hong Kong. However, there are other factors affecting the ceramic export such as the uncertainty of world economy, and the fluctuation of oil price due to the concern about war between U.S. and Iraq.
Problems:
1.
2. 3. 4.
The raw materials quality is inconsistent. The import duty of raw materials, especially the ceramic paint, is high compared to the competing countries. Energy, such as gas and electricity, is expensive compared to the competing countries. SME manufacturers lack good management system, use old machines and outdated technology, and have limited investment on machinery. Lack of research and development of ceramic products in business aspect and lack of personnel with skills, knowledge and expertise to develop production technology and product design. 39
NSVKMS MBA College Visnagar
5.
Lack of information about trading partners and competing countries. Unsupported by the government about the products exhibition fair in abroad.
Government Policies:
The government has many policies to support and promote the ceramic industry to be efficient and competitive with domestic and overseas markets as follows. 1. The Board of Investment and Ceramic Industrial Development Center in Lamping province has launched the project Linkage of production to the local, matching the production to production. This project would support an investment in the linkage of production and exporters or large factories with high potential in producing baked clay, enamelware, stoneware, porcelain, China bone, ceramic roof-tile, and mining business (except tin) covering ceramic industry in 17 northern provinces which would receive BOI privilege as specified by regulations. This project would enable an increase in ceramic export value. 2. Ministry of Finance has announced the reduction and exemption of customs duty based on Section 12 of royal regulations of customs duty HS-Code, 1987, (issue 2), dated June 12, 2007. Part of the regulation is about the reduction of customs duty on Part 25 raw materials for ceramic production such as kaolin soil, other soils, feldspar, gypsum, and other minerals by reducing tax from 5%-10% to 1%, effectively June 15, 2002. These are imported high quality raw materials; therefore, the reduction of customs duty would reduce the production cost and increase competitiveness in the world market. 3. Industrial Funding Corporation of Thailand (IFCT) has cooperated with the United Nations Industrial Development Organization (UNIDO), government and private sectors to launch the project of Lamping Ceramic Enterprise Network Development to form a group of ceramic manufacturers, including linkage and supporting business to specify vision and strategies of relevant parties to increase Lampungs competitiveness to be equal to the worlds ceramic industry. 4. The government has extended the measure to reduce transfer and mortgage fees for real estate from 3.3% to 0.01%. Moreover, this measure will be extended from the end of 2007 to one more years to support the real estate business.
Strategies
1. 2. Development of Raw Material Company and the supporting industry to remain standard of quality. Development of the production process and products to enable Thailand to be the leader of efficient production process of ceramic in Asia. It should have the widespread and efficient bilateral research and development in two parties popularly and efficiently.
3.
4.
Development of manpower, education, and specific institute network to facilitate Thailand to be the leader of original ceramic study in Asia and to have skilled and efficient personnel at all levels. Marketing support and export promotion to increase the export by participating in the exhibition fairs overseas and building more channels and marketers.
PRODUCTS
2006 (Jan-Nov)
* 2007 (Jan-Nov)
Changin g 2006 R a t e (%)
* 2007
Changin g R a t e (%)
PRODUCTION Floor-tile, wall-tile 78,209,196 92,194,045 17.88 (square-meters) Sanitary (pieces) Distribution Floor-tile, wall-tile 86,521,227 104,727,82 21.04 (square-meter ) 7 Sanitary (pieces) ware 2,372,457 2,796,727 17.88 94,224,903 114,248,53 21.25 9 2,583,497 3,050,975 18.09 ware 5,733,304 5,558,264 -3.05 84,849,270 100,575,32 18.53 2 6,140,166 6,063,561 -1.25
Table 2: Import and Export Values of Ceramic Products Value: US$ Million * Changin g Rate (%) 2006 2007
PRODUCTS
2006 (JanNov)
2007 (JanNov)
Changin g R at e (%) 14.37 5.38 34.28 -6.93 14.64 22.22 6.19 -10.85
Import of Products Export of Products
Ceramic 98.0 Ceramic 428.2
110.9 448.7 65.0 70.2 152.9 32.2 10.9 117.5
13.16 4.79 35.98 -6.90 14.96 21.05 2.83 -12.83
105.8 464.5 52.8 82.3 145.5 28.8 11.3 143.8
121.0 489.5 70.9 76.6 166.8 35.2 12.0 128.2
- Floor-tile, wall-tile 47.8 - Sanitary ware - Tableware 75.4 133.0
Souvenir and 26.6 ornaments - Electrical porcelain 10.6 insulator products Other ceramic 134.8
Japanese ceramic tiles industry:

Rapid rise in the production of Ceramic tiles in Japan: The Japanese ceramic industry started in1955 to rapidly increase its output of ceramic tiles. By 1963 production had increased 6 times, so that now Japan is among the main producers. Data on the production of tiles and mosaics from ceramic materials in this country during the period under review are given in Table 1. The main producers in the Japanese ceramic tile industry are the firms of Ina Seito, Danto, and Nikon Tile Kogio. Rapid developments in the production of tiles in Japan were favored by two main facts. Firstly, owing to the spread in Japan of the American style in building, there has been a considerable increase in the demand for this material on the domestic market; secondly, owing to the cheapness of Japanese products, tiles made in Japan have conquered many foreign markets, especially American. In the USA in the last few years owing to Japanese competition it has been necessary to close sevenCeramic tile factories. Japanese firms have concluded agreements with American building firms for
The long-term supply of large quantities of facing tiles. TABLE9.1 Year 2000 2001 2002 2003 Quantity in tons 66732 73436 95104 111428 Year 2004 2005 2006 2007 Quantity in tons 166931 230295 281598 342208
At the present time 20-40% of the total output of ceramic tiles in Japan is exported. In recent years competition from Japanese tiles has severely limited export potential for western European producers of ceramic tiles, since the Japanese rapidly and satisfactorily satisfy all the requirements of consumers in relation to quality, and manufacture the tiles more cheaply than in Europe, and furthermore use the advantages of cheap sea transport directly from the factories.
U.S.A. ceramic tiles industry:
The U.S. ceramic tile market continued to expand and experience growth in 2006. Consumption of tile increased 1.8% last year from 3.26 billion sq. ft. in 2005 to 3.32 billion sq. ft. Domestic shipments of tile decreased with 630 million sq. ft. shipped domestically in 2006, a decrease of 4.3% from 2005 (658 million sq. ft.).
Although overall total consumption set a new record, the increase in 2006 (1.8% overall) is slightly less than the 3.5% seen in 2005, due to the slowdown in the new housing market and resulting decline in overall floor covering sales. Remodeling and commercial markets, however, continued to bolster tile sales overall. Imports percent share of the U.S. ceramic tile market (in square feet) continued to rise in 2006 and comprised 82.4% of the total market. This follows the trend of imports gaining ground over the last 15 years. Imports were 46.2% of the market 30 years ago, and in each year since 1992, they have consisted of more than 50% of total consumption. The top five countries from which tile were imported (in millions of sq. ft.) in 2006 were: Italy 661 - decreased 4.1% from 05 Mexico 452 - increased 10.6% from 05 Brazil 430 - decreased 4.8% from 05 China 346 - increased 53.9% from 05 Spain 346 - decreased 5.0% from 05 Based on dollar value, however, we get a different picture of the import market: Italy increased 0.7% from 05 Spain increased 3.4% from 05 Mexico increased 9.7% from 05 Brazil decreased 2.9% from 05 China increased 60.5% from 05
Other statistical trends include:

2006 U.S. consumption of Italian tile (in sq. ft.) fell for the third straight year. U.S. consumption of Spanish tile (in sq. ft) decreased in 2006 for the company straight year. 2006 U.S. tile consumption from Brazil also declined, 4.8% from 2005 to 2006. U.S. consumption of Mexican tile increased in 2006 for the seventh straight year, up 10.6% over 2005.
China, which accounts for 12.7% (2006) of all tile imported to the U.S., continues to make a tremendous impact on the market. It now is the company-largest exporter of tile (in sq. ft.) to the U.S., with U.S. consumption of Chinese tile up 53.9% from 2005. Imports, which comprise a large portion of the U.S. tile market, rose from 80.9% of the market in 2005 to 82.4% in 2006. There are several factors that have lead to these trends: Weaker U.S. dollar vs. Euro More Italian companies manufacturing in the U.S. In general, imports from higher-cost producing countries declined, while imports from lower-cost countries increased.
As one can see from Tables 2 and 3, the main countries from which tile is imported have remained relatively the same in the past 10 years, although market share is now more widely dispersed. The emergence of China (0.2 % of U.S. tile imports in 1997; 12.7% in 2006) has also made a major impact on the industry. chart shows the trend over the last decade of the top 5 countries from which tile was imported (in thousands of sq. ft.).
The Market in 2007: Based on first and second quarter 2007 numbers, there has been a dramatic slowdown in the tile market. Consumption, domestic shipments, and imports are all down so far this year. Total U.S. consumption through 2nd quarter 2007 was 1.37 billion sq. ft., down 19.1% from 2nd quarter 2006.
Future Indicators and Key Influences:

Value of Dollar vs. Other Currencies: the value of the Euro increased almost 10 % from 2005-2006 vs. the U.S. dollar, and has continued to get stronger in 2007. The Chinese Yuan and Brazilian Real also made gains in 2006-2007, with the buying power of dollars shrinking against these currencies. The dollar increased in relation to the Mexican Peso, however. Mortgage Rates : The housing market is affected greatly by mortgage rates, which in turn influences the usage of tile. The average 30-yr. fixed mortgage rates have steadily risen from 5.87% in 2005 to 6.41% in 2006 and to 6.57% in August 2007. (Company: Freddie Mac)
Population: The U.S. population grew to an estimated 298 million in 2006, which is a 6.0% increase over 2000. It is estimated to increase an additional 1% (over 2006s population) in 2007. The U.S. has the worlds third-fastest growing population (trailing only China & India), which will require an estimated 100 billion sq. ft. of living space by the year 2030. This will result in a higher demand for flooring products, such as tile.
Housing Starts Enlarge this picture
Housing starts fell drastically in 2006, and continue to decline through 2007. The number of single-family housing starts fell 14.6% from 2005 to 2006, compared to a 6.5% increase from 2004 to 2005. The NAHB projects the slumping new home market will bottom out at the end of this year or early in 2008. 4
despite the decline in new housing starts beginning in 2006, the average size of single-family homes continued to rise to a record 2,456 sq. ft. This is a 1.7% jump over 2005 numbers and a 14.8% rise from 10 years ago, in which the average single-family dwelling was 2,140 sq. ft. 5 larger homes, kitchens, NSVKMS MBA College Visnagar 47
and bathrooms mean more need for flooring products like tile. Note the increasing number of homes with 3,000 or more sq. ft. Remodeling: Remodeling especially impacts the tile industry, as the two rooms most frequently remodeled are kitchens and bathrooms, which also happen to be the two rooms in which tile is most often used. The size and number of rooms in houses continues to rise. The latest data from the U.S. Census Bureau (2005) shows that 59% of new single-family houses have 2-1/2 or more bathrooms, and 96% have at least two bathrooms. The National Kitchen and Bath Association (NKBA) estimates that in spite of the housing market decline, the remodeling industry will remain steady in 2007. Approximately $265 billion was spent on kitchen and bath remodeling in 2006, and that number is projected to be $262 billion, slightly down 1.1%, in 2007. Americas aging Boomer population, with more disposable income than past generations, has fueled the remodeling market, and todays younger generation is more design-savvy and has more money to spend on remodeling, as well.
Summary and Outlook: In spite of the current downturn in the tile industry, there are reasons for optimism. Tile was one of only three floor coverings (along with area rugs and rubber flooring) that saw an increase in sales last year. Ceramic tile also continues to gain a larger share of the floor covering market (10.6% in 2006, up from 9.6% in 2005) and is now third overall behind carpet and area rugs. Looking ahead to the rest of 2007, based on 1st and 2nd quarter numbers, if the current trend continues for the remaining two quarters of 2007, total consumption would be down a total of 17.2% from 2006. Also: GDP is predicted to grow at a 2.0% rate in 2007. 8 the projected U.S. economic growth for 2008 is 2.8%. This is the lowest growth since 2002.New housing starts are expected to decline until at least early 2008, with sales not getting back to the 1.5 million levels (i.e. where they were in 2003) until 2010 or 2011.10
Indian ceramic tiles industry:

The word Ceramic comes from the Greek word Keramos meaning pottery, it is related to an old Sanskrit root meaning to burn but was primarily used to mean burnt stuff. In the early days the tiles were hand made, hand formed and hand-painted. But today the ceramic tile is not hand made or hand painted for most of the part. In fact in the modern house throughout use ceramic tiles for their bathrooms and kitchens and in every vital area of the premise. Apart from decorative look ceramic tiles are primarily hygiene products and that is evident from its usage ranging from bathrooms and kitchens in average Indian households to medical centers, labs, milk booths, schools, public conveniences etc. A ceramic tile is basically a utility product and popular housing projects are increasingly switching over to Ceramic Tiles from the traditional mosaic and even granite or marble, owing to several factors viz. ease in laying ability, versatility, low price and most importantly hygiene. The main product segments are the Wall tiles, Floor tiles, Vitrified tiles and Porcelain tileSegments. The market shares are 35 percent, 53 percent and 12 percent respectively for wall,Floor & Vitrified/Porcelain tiles. Industry Profile: Ceramic tiles as a product segment have grown to 3.8 million tons production per annum. The potential seems to be great particularly in view of the boom in the housing sector, retail sector and IT and BPO sectors. The ceramic tile sector has been clocking a robust growth of 12-15 percent consistently over the last few years. The investment in the ceramic tile industry, in the last five years is approximately Rs2000 cores. This industry provides employment of 550000 people, 50000 of whom are directly employed. The potential is huge considering the per capita consumption of ceramic tiles in India. Currently it is at 0.5 sq.m per person in comparison to over 2 for like countries like China, Brazil and Malaysia. Some of the key statistics pertaining to the industry are summarized below:
International Scenario:
30 major tile manufacturing companies cover 95.8 percent of the total world production of ceramic tiles in 2005. Asia contributes 53 percent to the total world production in 2005, 54 percent in 2004 and 50 percent in 2003 respectively. China is the largest producer and contributes almost 33 percent of the world production in 2004. This is followed by Thailand, Poland, South Africa and Russia which are growing at almost 20 percent CAGR between 2001- 05 whereas countries like Japan, Italy have shown negative growth over the period.
Asia tops the consumption chart followed by EU and South America. China dominates the consumption list and its consumption is almost company times that of Brazil. Germany, France features in the top 10 list of consuming countries but they are not there in the top 10 producing nations. Going further USA, Germany, France and even India consume more than they produce and they are meeting their demands through imports. The 30 major tiles manufacturing countries are also the biggest consumers and consume 88.20 percent of the total world consumption of ceramic tiles. Europe is the highest exporting region and exports almost 50 percent of its production to the other regions.
Whereas Asia consumes most of its production in its own region and has little left to export. Italy, Spain and China are the leading exporters and USA, Germany and France are the leading importers. China which was the 3rd largest exporter in 2004 has at present become the 2end largest exporter. Exports of the 15 major exporting countries represent 23.9 percent world consumption and exports from Italy and Spain represent 42.6 percent of the worlds exports and 11.2 percent of world consumption.
Indian Scenario:
In India, Ceramic tile industry emerged in the late 1950s. Ceramic Tile Industry can be classified into three categories namely wall tile segment, floor tile segment and vitrified and porcelain tile segment. In India the floor tiles segment is growing at a faster rate. The market for the wall tiles is rising at a relatively slower pace and this has resulted in high excess capacity in the wall tile segment. The entry of two new product categories Vitrified tiles and Porcelain tiles has increased the size of the market considerably. It is expected that these products will gradually take away the market from the conventional ceramic tiles (wall and floor). As far as manufacturing of ceramic tiles is concerned, both the organized and unorganized sector s play a very important role in India.
The per capita consumption of ceramic tiles in India is very less as compared to the other countries in the world. It is as low as 0.15 sq.mtr per annum. This low per capita consumption shows the likely demand that is going to arise in the future in India as more and more development takes place. Ceramic Tiles are furnishing material apart from being utility or hygiene products. Despite an overall slowdown of the economy this sector continues to grow at a healthy 12 percent per annum. Growth of the unorganized sector accounted for 44 percent of the total production and the revenue earnings from the organized sector accounted to over Rs150 core. India ranks 7th in terms of production in the world and the market share of India have risen from 1.7 percent to 2.7 percent in terms of ceramic tile production.
Potential for the Ceramic Industry in India: Like developed markets the financial institutions (both foreign and domestic) are beginning to show interest in the sector. Various foreign Real Estate and Finance companies like GE Commercial Finance, Tishman Speyer, Ascendas and Farallon Capital have entered the Indian market. The Ceramic Tile Industry drives its demand from the Real Estate and Construction sector. Ceramic Tiles Export Region wise Weekender Ceramic tiles find its maximum usage in residential and commercial buildings and are also finding acceptance in other construction projects as well like airports, bus terminals etc. as they are found more suitable at places where there is more human traffic. In India the construction sector is expected to do well in future mainly due to fiscal incentives given to infrastructure development. India is the prime destination for the IT services outs company. In the coming five years at least 55 million sq.mt of extra office space must be completed in the premium office space alone. Investment commission report states that the retail sales were $206 billion in 2004 and is expected to grow three-fold in the next 10 years from $206 billion to about $660 billion by 2015. Organized retail was only $6.4 billion and is expected to grow rapidly to reach $100 billion by 2015. Further India is expected to be among the top 5 retail markets in the world in 10 years. The Ceramic tiles particularly the vitrified tiles are finding increasing usage in both these sectors and the sector would benefit from an upsurge in these areas as well. Indian economy is poised to grow at 7-8 percent and with growing incomes and urbanization, demand for houses is slated for growth. The increasing focus on rural areas, by government and corporate, the demand for housing would also increase in rural areas. The ceramic industry will also benefit from the above developments. Increasing demand is just one part of the story the availability of Finance is the other part. With the availability of loans at low interest rate and tax incentives have enabled the people to buy houses and build up their own establishment. With the increasing competition amongst both Banks and Housing Finance Companies the people are avail of getting better financing options and that too at a cheaper rate. This would further increase the demand for tiles. Another important driver is the distribution network of a ceramic tile manufacturing company. The distribution network is critical to success in this industry.
Distribution Chain in Tile Industry: Direct Project Dealer/Wholesaler Builder Contractor User
10.Market Trend of ceramic tiles in India

Wall Tiles:
In the wall segment, informed Abhishek So many, executive director of SPL Ltd (owners of the So many brand), there are umpteen designs and sizes available. So many prices begin from Rs 22 per sq feet. The popular sizes here include 10 cm X 10 cm and 20 cm X 20 cm. While glossy finishes and dark colors were popular earlier, pastel shades are the rage now. Kajaria Ceramics offers wall tiles in sizes like 20 cm X 20 cm and 30 cm X 30 cm. Their prices range from Rs 20-40 per sq ft. They have recently introduced the 25 cm X 40 cm size where the price is Rs 35-40 per sq ft.
Floor Tiles, Bathrooms:

In bathrooms too the trend is towards larger sized tiles. So many offers sizes ranging from 10 cm X 10 cm to 30 cm X 90 cm. The popular sizes include 25 cm X 35 cm, 30 cm X 45 cm, etc. Natural finishes like silk, leather, linen, etc are in. Also very popular are stone finishes like Jaisalmer stone, Udaipur green, Italian marble, etc. Customers also welcome jute and bamboo textures. Geometric patterns have fallen out of favor. As for colors, Abhishek So many of SPL Ltd informed that pastel shades are in vogue now. Manufacturers like So many and Kajaria are offering full concepts, which include borders, motifs and matching wall and floor tiles. Abhishek of SPL Ltd informed that customers don't want to spend time mixing and matching wall and floor tiles and then choosing the borders, hence manufacturers are offering those complete concepts. In bathroom tiles Kajaria has recently launched the 25 cm X 40 cm size.
Floors Tiles, Homes

In grade A cities, Abhishek So many of SPL Ltd informed that natural finishes like stone, marble, rustic, leather and jute are in vogue. Matte finishes are preferred over glossy finishes. Wood look-alikes are also very much in demand. In smaller cities and towns, he said, glossy finishes, geometric designs and darker colors are still in demand. In residential flooring again, customer preferences are shifting towards larger sizes. The minimum size in floor tiles today, informed Abhishek of SPL Ltd, is 30 cm X 30 cm. This can go up to 90 cm X 90 cm.
Rishi Kajaria, director at Kajaria Ceramics Ltd., informed that their range of floor tiles for homes is available for Rs 20 to 40 per sq ft. Kajaria offers rustic styles like Kansas and Ranger. They also offer rectified (joint less) tiles under the brand name Rectificado. All these three types of tiles come in the price range of Rs 35-40 per sq. feet. They have also launched the Graphica range which comprises of designer tiles in the Rs 32-35 per sq ft price range.
Floor Tiles, Offices

In offices vitrified tiles are catching on very fast - in both polished and glazed finishes. In the glazed finish the advantage is that you get a lot of designs. In polished finishes you get restricted to beige color and marble finish. Vitrified tiles can take a lot of abrasion. For the polished finish, So many offers tiles in the price range of Rs 60 to Rs 120 per sq feet. For the glazed finish their prices range from Rs 40 to 60 per sq feet. So many has launched the VC Shield range which is made from Veil craft technology. Besides being abrasion resistant, these tiles are also frost and stain resistant, and they are also joint less. The VC Shield range comes only in matte finish, not in glossy finish. They come in two sizes: 40 cm X 40 cm and 50 cm X 50 cm. For the office sector Kajaria imports vitrified (porcelain) tiles from Indonesia, which come in the Rs 50-70 per sq ft. The largest size they offer here is 60 cm X 60 cm.
Trends of the usages in global:

The American taste: Time when the AMERICAN public associated ceramic tiles with a 10X10 cm white square used solely in the industry bathrooms and kitchen is long gone. Today the situation has turn around completely and it is becoming increasingly common to find ceramic tiles in specious communal areas of American homes the hallway, living room, dinning room, and kitchen as well as in bathroom. The trend for making open home makes it impossible to divide floor space into rooms. As ceramic tiles are already valued as covering for high traffic areas like entrance and areas susceptible to staining such as a dinning room and kitchen, the new trend works to benefit Domestic housing: The fact that American housing has become larger and are still increasing in size means that the America are taking more and more to larger format tiles. In general term the most popular format are 15X15, 15X20, 20X25, and 20X30 cm for wall tiles, where as in floor tiles the 30X30, 33X33, 40X40, 45X45 cm size sell most. Large format are most popular in the state of Florida and California. On the design side rustic and distressed the stone tiles are no. one. Marble effect tiles also have market and semi polished tiles are fashionable. Modular size were small format are used for kitchen walls and workshops and in a combination larger format on floors, are also very popular. Neutrals shades: As far as color trends are concerned, the American are still wedded to neutral and pale shade- cream, beiges, sand, toast, and so on. Darker shade are become popular especially those part of the country were tiles are mostly used. Other popular color is gray, pink and pale green. On the whole the American consumer trends to aim to create a comfortable house with traditional dcor. German taste: There is no such thing as German taste even in what is now a unified Germany the answer, surely, has to that there is no central European taste. In todays world of long Haul travel and world wide communication network European have become living in global village. The most fashionable motifs are taken from natural out in the market place, those product with a design inspired be nature are the most successful. Faithfully replicating granite and marble is not enough: it is essential that color and texture be inspired by nature too.
The trend is being spurred by the outstanding the specification that for porcelain stone ware can offer. Equally, it is decorative potential in both floor and wall tiles. A close look at the trends in floor tiles would seem to confirm that leading color are beiges, brown, anthracite, and black. White and blue; the preferred color for wall tiles is white, especially combine with blue. Combination of white and yellow green colors are frequently being popular in Germany there is currently move back to using loud colors in dcor and this are gaining ground on the pastels It is important to note that the large format is greater in the south of the areas then in the north. In the north and east the traditional 20X25 cm format for wall tiles and 30X30 cm for floor tiles are preferred. As regard borders and complimentary pieces, anything goes: glass natural stone, metal, ceramic borders, are adopting latterly for the German customer. United Kingdom state: The British loves more formats. The United Kingdom is European country with the lowest per capital consumption of ceramic tiles, but is showing and increase years on year. Spain is playing a very important part in the leading foreign supplier of ceramic tiles the consumption of wall tiles is streets ahead of that of floor tiles (approximately 80%:20% ). Sale of floor tiles, however, is growing at faster pace than wall tiles in both value and volume. The main and almost exclusive use of tiles in the home is cover bathrooms and kitchen walls. The most widely sold format is small particularly 15X15 and 20X15 cm which together more appropriate. The colors spectrum, consumers color preference to be conservative. Very small format in dark color (deep red, green and blue) are still popular for bathroom as is imitation marble. In kitchen British taste toward light color and traditional motifs for the wall, whilst the classical black and white checks board is still very popular for wall. Consumer with higher deposable income for more sophisticated taste is beginning to consider that floor adds value to there home. This is being reflected note just in rise in tiles sales but in grater diversity of style and colors and offer to gather with bolder decors. For instance imitation natural stone for floor and larger format in general both wall a floor. The use of tiles in increasingly frequently and become popular in country.
As arising opportunity in the republic of Macedonia: Since gaining independence in 1991, in spite of the difficulties posed by political and social unrest in the region, Macedonia has implemented in reform programmed design to develop free market economies and achieve and closures integration with international trading partner. The priority has been placed on economy reform and, in this; the government has worked closely both the World Bank and the MF. Macedonia has started working toward membership of the EU and has recently been granted full membership to WTO. The economy reform include: Widespread privatization of state and socially own enterprise. Regional European and world wide trade liberalization. Promotion of FDI (including major foreign capital banking and insurance industry.
Macedonia took major steps toward integration with the EU with the signing of the stabilization an association agreement in April 2004 and a free agreement with the European Free Trade Association (EFTA) whose implementation this year. Duties and goods imported for EU into Macedonia will be progressively reduce to zero duty by the end of 2010. Country has some very important trading partner like Slovenia, Yugoslavia, Romania, Croatia, Bulgaria, Turkey, Ukraine and Albania accounted for approximately total importing and exporting in 2000. Macedonia has now sign free trade agreement with this country and begun negotiation with Russian federation. Recently Macedonia enters in to WTO for the integration to world trading system. It expands the market of Macedonia goods and services. In order to attract FDI the government of Macedonia has taken initiative steps include:
A relatively low rate of corporate income tax (15%). The custom duty exemptions on imports of equipment and other capitals assets. Creation of Free Economic Zone.
The benefit of producing in Macedonia includes:
Low labor cost Highly skilled workforce Strong industrial tradition Stable macro economic situation Easy access to export market in both EU and other Balkan state Development of Macedonia relationship with the EU and the WTO
11. Statistical Data

Statistical figure showing production consumption and export detail:
Top manufacturing countries of ceramic tile: Table 11.1
Country
2005 Production (Million Square Meters) 1,810 638 638 473 220 109 150 167 63 78 95 65 67 66 45 46 55 57 40 50 47 53 44 35 27 30 30 15 26 25 5,263 5,550
China Spain Italy Brazil Indonesia India Turkey Mexico Thailand Iran Vietnam Egypt Malaysia Portugal Russia Poland United States Germany United Arab Emirates South Korea Taiwan Japan France Morocco Argentina Czech Republic Algeria South Africa Columbia Philippines Total Total World Production
Percent of World Production (Based on 2007 Production Data) % 32.3 10.4 10.0 8.9 4.3 3.2 3.1 2.8 2.2 2.0 1.8 1.4 1.2 1.2 1.2 1.1 1.0 1.0 0.9 0.9 0.8 0.8 0.7 0.7 0.6 0.5 0.5 0.5 0.4 0.4 96.7 100.0
Source from magazine, "World Production and Consumption of Ceramic Tile", Ceramic World Review.
Top Consumption Countries for Ceramic Tiles: Table 11.2 Country 2005 Consumption (Million Square Meters) 1,500 417 312 211 192 102 164 129 168 125 95 94 59 60 65 72 71 50 53 62 60 56 55 51 31 34 24 33 27 29 25 4,426 5,142 2006 Consumption (Million Square Meters) 1,600 456 327 245 183 145 144 141 110 124 98 90 83 65 77 85 62 66 58 56 61 54 43 45 33 35 28 33 29 33 29 4,638 5,426 2007 Consumption (Million Square Meters) 1,700 421 332 267 183 180 147 146 130 125 103 103 97 97 92 87 75 66 61 61 56 49 48 45 36 35 35 33 33 32 31 4,906 5,724 Percent of World Consumption (Based on 2007 Consumption Data) % 29.7 7.4 5.8 4.7 3.2 3.1 2.6 2.6 2.5 2.2 1.8 1.8 1.7 1.7 1.6 1.5 1.3 1.2 1.1 1.1 1.0 0.9 0.8 0.8 0.6 0.6 0.6 0.6 0.6 0.6 0.5 85.7 100.0
China Brazil Spain United States Italy India Germany Mexico Indonesia France Vietnam Turkey South Korea Thailand Russia Iran Poland Egypt Saudi Arabia United Kingdom Portugal Japan Taiwan Malaysia Morocco Algeria South Africa Greece United Arab Emirates Australia Canada Total Total World Production
Source from the ceramic world review magazine artical
Highest: per capita consumption / SQM of ceramic tiles in the world: Table 11.3
NO COUNTRIES HIGHEST PER CAPITA CONSUMPTION / SQM PER CAPITA CONSUMPTION / SQM
ARGENTINA TURKEY POLAND FRANCE BRAZIL ALEMAY ITALY TAIWAN PORTUGAL SPAIN
1.50% 1.60% 1.80% 2% 2.20% 2.30% 3.30% 5.20% 6.30% 6.80%
HIGHEST PER CAPITA CONSUMPTION / SQM PER CAPITA CONSUMPTION / SQM 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 1.80% 2.00% 1.50% 1.60% 1.00% 0.00% 6.30% 6.80% 5.20% 3.30% 2% 2.20% 2.30%
N TI N A TU R KE Y PO LA N D FR AN C E BR A ZI L AL EM AY
TA IW AN PO R TU G AL
IT A
AR G
SP
AI N
LY
63
HIGHEST PER CAPITA CONSUMPTION / SQM PER CAPITA CONSUMPTION / SQM
Interpretation: It is mostly seen from the graph and figure that Spain and Portugal are the largest consuming countries for ceramic tiles, their share is about to be 6.8 % and 6.30% respectively. They are followed by Taiwan and Italy with share of 5.20% and 3.30% consumption in Spain is highest because better and more complex design and , in general, of possibilities of utilization in term of duration, cleanness and hygienic aspects .The concept of eco labeling has also raised the demand for the ceramic tiles in the European country.*.
Highest ceramic tiles exporting countries in world: Table 11.4

Country 2005 Exports (Million Square Meters) 2006 Exports (Million Square Meters) 2007 Exports (Million Square Meters) Percent of World Consumption (Based on 2007 Consumption Data) % 7.3 5.9 3.6 1.8 1.5 1.0 0.6
Italy Spain China Brazil Turkey Indonesia United Arab Emirates Mexico
441 339 53 47 57 30 22
438 357 125 74 74 50 39
418 336 206 103 84 60 35
37
33
29
0.5
Malaysia Portugal Germany France Czech Republic India Thailand Total Total World Exports
23 21 21 22 17 7 12 1,148 1,244
29 22 22 21 17 10 13 1,324 1,410
29 25 22 19 17 15 13 1,411 1,505
0.5 0.4 0.4 0.3 0.3 0.3 0.2 24.6 26.3
Highest ceramic tiles importing countries in world: Table 11.5

Country 2001 Imports (Million Square Meters) 2002 Imports (Million Square Meters) 2003 Imports (Million Square Meters) Percent of World Imports (Based on 2003 Import Data) % 13.8 7.3 6.9 3.7 3.5 2.8 2.2 1.6 1.6 1.6 1.6 1.5 1.2 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.8 56.5
United States Germany France Saudi Arabia United Kingdom South Korea Greece Australia Belgium and Luxumbour Israel Canada Poland Netherlands Austria Thailand Russia Mexico Hungary Italy South Africa United Arab Emirates Total Total World Imports
160 127 104 48 54 22 33 24 25 31 24 26 19 16 13 8 13 14 7 9 776 1,244
189 113 104 61 48 32 33 28 24 26 27 23 19 15 12 13 14 16 12 13 824 1,410
207 111 104 55 52 42 33 25 25 25 25 23 18 16 15 14 14 13 13 12 12 851 1,505
World Manufacturing Regions for Ceramic Tiles:

Table 11.6
Regions Asia European Union Central and South America Europe (non E.U.) North America Africa Oceania Total 2007 Production (Million Square 3,058 1,422 652 420 234 212 5 6,030 % of World Production 51.2 23.6 10.8 7.0 3.9 3.5 0.1
World Consumption Regions for Ceramic Tiles:

Table 11.7
Regions 2007 Consumption (Million Square Meters) 2,973 1,044 579 444 412 238 34 5,724 % of World Consumption
Asia European Union Central and South America North America Europe (non E.U.) Africa Oceania Total
51.9 18.2 10.1 7.8 7.2 4.2 0.6
Ceramic tiles segment wise share:

Table 11.8 Floor tiles Wall tiles Vitrified and porcelain tiles 46% 42% 12%
Ceramic tites segment wise share
12%
floor tiles
46%
wall tiles
42%
vitrified and porcelain tiles
Interpretation: Tiles form the most significant part of the Indian ceramics industry and consist of floor tiles (46 per cent), vitrified and porcelain tiles (12 per cent) and wall tiles (42 per cent). The floor tiles segment is growing faster as compared to wall tiles. Vitrified and porcelain tiles are recent entrants into the ceramic tile industry and have increased the size of the market considerably. It is expected that this segment will capture the bulk of the market gradually, replacing the conventional floor and wall tiles segment. These tiles are light and have the added advantage of being offered in designer looks as compared to mosaic tiles, which are. Heavier and more expensive to transport. Both organized and unorganized sectors play a key role in the manufacturing of ceramic tiles in India.
The Indian ceramic tile industry is estimated at US$ 0.35 billion:

Table 11.9 year 2003 2004 2005 2006 2007 Billion 97 100 103 123 207
Interpretation:
The size of the Indian ceramic tile industry is estimated at US$ 0.35 billion. It comprises of wall tiles, floor tiles and vitrified tiles. The per capita consumption of ceramic tiles in India is just 0.15 square meters per annum, which is quite low as compared to developed countries.
Capacity of ceramic tiles:

Table 11.10
year 2003 2004 2005 2006 2007
Million tonnes 120 120 120 120 215
Interpretation:
The industry has been experiencing increased demand, which, in recent years, has matched the installed capacity. While capacity has also increased significantly, from 120 million tones in 2001, to 215 million tones in 2005, the demand has grown nearly two and a half times in the same period, from 97 million tones to 207 million tones. Ceramic tiles are produced by organized, as well as unorganized players. The share of production of organized players is around 55 per cent. The organized sector is characterized by the existence of a few large players, such as H. & R. Johnson, Kajaria Ceramics, Bell Ceramics, SPL, Spartech and Murudeshwar Ceramics. H. & R. Johnson leads Export and Import of Sanitary ware: Exports of ceramic sanitary ware from India have gone up marginally, from US$ 17.9 million to US$ 20.7 million in the period 2001-02 to 2006-07. Imports have risen rapidly from nearly zero in 2002-03, to US$ 8.8 million in 2005-06. Rapid rise in consumption (production + imports) indicates the strong demand in the domestic market, driven by housing construction boom over the past 5 years.
Indian sanitary ware market: Indias sanitary ware market is estimated at US$ 42 million. Production of sanitary ware has been increasing rapidly over the past few years and stands at nearly 190,000 tones per year. Production has been growing at about 17 per cent CAGR over the past 5 years. About 50 per cent of production is from the organized sector, which comprises of about 15 firms. The unorganized sector, comprising of nearly 150 units, accounts for the other 50 per cent. EID Parry and Hindustan Sanitary ware are the biggest organized players, together accounting for about two-third of the output of the organized sector.
12. Some contemporary issues for the Global Vision

Eco Labeling concept in the European countries: The choice of environmentally friendly materials is an important step in the path towards sustainable building. The production of hard floor coverings has a significant life cycle and research has shown that there is considerable scope for the reduction of such impacts. Among other improvements, increased efficiency in the use of water and energy can benefit the natural environment in which quarries are located and can lead to important cost savings. In the ceramic tiles sector, for example, the European Union is the worlds main producer and consumer. Much of the sectors trade take place inside Europe and market is becoming highly competitive. An easily recognizable guarantee of environmental excellence can become a key marketing tool towards environmentally conscious builders and end consumers. The European eco-label which is the only sign of by an independent organization and valid throughout Europe. Putting the eco-label on products means that the following assets: Reduced energy and water consumption during the production phase. Limitation of substances harmful for health and the environment. Reduced impact of extraction on habitats and natural company. Limited emission to air and water. Improved consumer information and waste management.
Reduction of the impact on the natural environment natural products: No interference with deep confined waterbeds, surface-bodies with civil catching or springs, with average flow > 5 m3/s, or protected areas according to NSVKMS MBA College Visnagar 74
directive 2000/60/ec water recovery closed system in place. Water shall be recycled technical report on extraction and recovery showing compliance with directives 92/43/eec and 79/409/eec. (Applicants outside EU: compliance with UN 1992 convention of biological biodiversity).
Score system based on matrix of 9 indicators: Water recycling ratio 80%. Rehabilitation simultaneity 50%. Block recovery : Marbles 20% Granite 30% Others 10%
Natural company appreciation (usable material /extracted material): Marbles and granites 35% Others 25%
Working conditions of operating equipment Air quality: PM 10 suspended particles 150 mg/Nm3. Water quality: suspended solids: 40 mg/l. Noise: 60 db (A) Visual impact 30%.
Limitation of the use of substance harmful for the environment and health:
Prohibition of the use of substances or preparations classified as carcinogenic, mutagenic, teratogenic, and toxic for the reproduction of the aquatic animals according to directive 67/438/eec. Limited content of heavy metals and their compounds in additives: (% in weight of the glazes) Pb < 0.5.cd<0.1.sb<0.25. No asbestos present in the raw materials. Polyester resins < 10 of total weight of raw materials. Water recycling ratio 90%. Reduction of emissions to water (in mg/l) Suspended solids <40. cd<0.015. Cr (VI), 0.15. pb < 0.15.
Natural products: particulates < 150 mg/nm3, styrene < 210 mg/nm3 Processed products (in mg/m2) Agglomerated stones: Particulates < 300. NOx < 1200. SO2 < 850. Styrene < 2000. Ceramic tiles: Particulates < 200. F< 200. NOx < 2500. SO2 < 1500. Clay tiles: Particulates < 250. F < 200.NOx < 3000. SO2 < 2000.
Terrazzo tiles and concrete paving units: Particulates >300.NOx >2000. SO2 <1500.
Cement (g/t) Dust < 65. SO2 < 350. NOx < 900.
Processed products (MJ /m2 of final product): Process energy requirement (PER) Agglomerated stones < 100. Terrazzo tiles < 60. Cement < 3800 (MJ/t) Energy requirement for firing (ERF): Ceramic tiles: Specific weight 19 kg/m2:<50 Specific weight > 19kg/m2:<70 Clay tiles <60.
Reduction of dangerous substances released to the environment: Glazed tiles (in mg/m2) Pb < 80 Cd < 7
GLASS:
Energy Savings Method Of Manufacturing Ceramic Products From Waste Glass: Traditionally ceramic products have been created using raw materials that require high firing temperatures and energy intensives processing steps. The manufacture of clay-based tiles, for example, requires firing temperatures of approximately 2200F. Ceramic products can also be produced using glass-melting methods, which require temperatures of 2700F or more. A new technology being developed by haunt labs has potential to lower energy costs related to the conventional method of manufacturing ceramic products by substituting raw materials with recycled waste glass has demonstrated that products created using the new processing method are less sensitive to contaminants in the glass and can be made from either green or mixed-color waste glass, which are difficult to recycle ,with 100% substitution ,firing temperatures for this new process can be reduced by as much as 37% (clay-based), resulting in significant reduction in energy costs and a significant increase in recycling rate. In addition, this new process resolves inherent chemical and processing incompatibilities previously encountered with the use of traditional ceramic raw materials and manufacturing methods.
New manufacturing method reduces energy use during the production of ceramic tile from waste glass: Benefits: NSVKMS MBA College Visnagar 77
Sintered recycled glass process reduces energy consumption during firing processes by 37 % compared to clay-based tiles and 50% compared to glass melt-based tiles. Uses up to 100 % waste glass as raw material. Does not require water or clay for production. Eliminates the need for expensive, clay for production step needed to produce powder. Requires only one firing step due to the rapid sintering behavior company of glass powder. Eliminates product molds used in some waste-glass production processes.
Applications: This new processing method will have immediate application in the ceramic tile industry, where raw material and fuel costs are significant. Because ceramic tile is used in both residential and commercial floor and wall coverings, mass-market appeal due to its less energy-intensive, recycled nature. Caramic tiles made from 95-100 % recycled glass Ceramic tiles produced from recycled glass offer the same quality as traditionally manufactured tiles, but require substantially less energy to produce.
Supply Chain Scenario:

Efficient bidding and procurement vision with respect to the developing world of ccommerce: The global vision of the e.bip project is to build an effective up-to-date B2B website and market place that will significantly improve the procurement process, while reducing procurement costs and time in the tile and stones industry and subsequently in other construction materials industry. In other words, it is a construction industry portal which will significantly improve the global competitiveness and market growth of the supply chain players by providing a comprehensive supply chain procurement process solution running on the internet .the e.bip solution will be a multifaceted technology solution serving the needs of manufacturers, distributors/wholesalers and end users in the tile supply chain by optimizing the procurement and purchasing decision making processes.
Value chain: The e.bip value chain is detailed ranging from producers, to wholesalers to tile layers. Major emphasis has been given to the stone business value chain. E.bip business scenario Company different commercial scenario related to the envisaged e.bip software system is outlined.Since the e.bip project aims to develop a business to business e-broker system, the scenario considers only the B2B relations between the NSVKMS MBA College Visnagar 79
members of the tile value chain. The first prototype of the e.bip system will be restricted to tile products, but will be extendable to other material. Performance measure The performance measures have been revised to evaluate the impact of e.bip on business performance of tile producers, wholesalers and tile layer. E.bip pilot systems: The e.bip system mainly consists of three different functional components. Namely the Master Broker system, representing a central stand alone on-line broker service, the seller and buyer client modules, connecting the master broker system with existing back office solutions and a local e.bid/e.bip application for bidding and procurement. The core use cases of the e.bip market place are illustrated by emphasizing the actors of the tile value chain who surround the master broker system and by describing their major interactions with the system. Finally, the various options to exchange color information along the value chain are detailed.
Global vision The global vision of the e.bip project is to build an effective up-to-date B2B website and market place that will significantly improve the procurement process, while reducing procurement costs and time in the tile and stones industry and subsequently in other construction materials industries. In other words, it is a construction industry portal which will significantly improve the global competitiveness and market growth of the tile supply chain players by providing a comprehensive supply chain procurement process solution running on the internet. The e.bip solution will be a multifaceted technology solution serving the needs of manufacturers distributors/wholesalers and end users in the tile supply chain by optimizing the procurement and purchasing decision making processes. It has been proved that the e.bip solution will allow dramatic cost-effective reductions in time and cost to the tile industry: producing, placing and managing on-line bids for commodities and significantly reducing the costs involved with managing procurement activities.
E.bip- Main Selling Points

The main selling points of the e.bip portal will be:
Improved decision processing for projecting turnover and more effective project bidding. Increased standardization of products and identifiers. Reduction of the overall cost of the items and time to procure the items. Increasing market growth and penetration for all users. Comprehensive procurement and decision making process solution replacing multiple software packages. Interface capability with user systems. More effective use of computer technology by all users. Access to real-time product information using state-of the-art color proofing and certification support.
In addition, the project will propose a new business model for sharing information, making purchasing and procurement decisions and handling all the procurement activities using a comprehensive suite of software solutions which will run on the internet. These last features enable to position the e.bip solution in to the ccommerce arena, which will be described in the next section.
C-Commerce and the e.bip solution Collaborative commerce (c-commerce) is the use of an on-line business tobusiness exchange to facilitate the flow of information rather than to process transactions. Business partners can exchange information, such as inventory data, by using a web server as an intermediary. In many cases, collaborative commerce simplifies data interchange by eliminating the need for special client software at each customers site. The master broker system in the e.bip solution will reach those goals and it will be managed as a 3rd party intermediary. As the impact of the web continues to become ever more invasive, reaching all areas of the enterprise, the need for collaboration and synergy cannot be ignored. Profitable implementation of e-market place solutions will require more than sound strategies, tools and tactics. Enormous competitive advantage will be achieved by integrating collaborative commerce a new model for business applications that enables companies to leverage internet technology to collect disperse business information, so NSVKMS MBA College Visnagar 81
that they can use it more effectively. This is the case of the tile industry supply chain, which continues to use a traditional procurement process, rather slow and extremely expensive. Moreover, the e.bip solution will contribute to the regulatory policies and efforts of standardization inside the European Union, which is one of the main goals of the project. C-commerce and e-marketplaces Collaborative commerce and B2B e-market places represent an important step beyond the buy/sell e-commerce model. Driven by evolving business demands and enabled by increasingly powerful web technologies, it allows customers, companies and vendors to benefit from a cyber community in which they can share intellectual capital and leverage core competences and best practices. It is a powerful combination and promises to deliver significant increases in corporate innovation, productivity and profitability. In this respect, the e.bip solution stand alone as broker bidding/procurement software system can be sold to construction material providers (wholesalers, producers and traders) wishing to establish their own e-commerce internet portal. Most B2B solutions in the market today either enable transactions, present content or allow structured data exchange. C-commerce technologies are expected to change this paradigm, adding information-rich interactive capabilities to the e-business environment. In this respect, the e.bip solution will open the way, as it will provide access to real time product information using state-of-the-art color matching technology. The e.bip competitors do not provide features demanded by users, do not focus on the construction industry, do not have an advance procurement market place and do not have any language facilities. Administer users/products in order to administer the master broker system, the broker operator is enabled to accept or reject new users (i.e. sellers and buyers) who have registered those selves to the broker service. Additionally, the master broker will provide functions for managing the product classification scheme and for (re)arranging product data within the scheme. By providing statistics about the transactions and repository status (eg.number of users, search requests, products), the master broker enables the operator to retrieve the information required for controlling and managing the brokerage service. Users interactions with the e.bip market place In order to detail the described use cases this chapter summarizes the major interactions with the e.bip marketplace for the different members of the tile value chainlike. tile layers/architects, wholesalers and tile manufacturers. Tile layers/Architects In an interaction scenario with the master broker system any tile layers like bedaub-takes the role of a buyer. In general, the layer is searching for valid product information provided by its suppliers (manufacturers and /or wholesalers). Tile layers will use the e.bip marled place to: NSVKMS MBA College Visnagar 82
Get an overview of available products and search to specific products by using different search criteria, such as object (hospital, laboratory area etc.), size and color. Be informed about new products
Wholesalers A wholesaler takes the role of a buyer and seller. The wholesalers interactions with the e.bip market place can be summarized as follows: Download updated article database. Download technical description, laying suggestions and other supporting material. Download pictures for ads, catalogues and websites Discuss technical problems with experts of the producer (experts forum) Browse producers electronic exhibition for new products. Get information on availabilities and delivery times of own product line. Get information on matching colors nuances (branding) Retrieve special offers (matching received requests of his clients) Receive documents in electronic form (delivery note. bill etc) See changes in his wholesalers product line See changes in a certain producers product line. Check availability and delivery times Get access to detailed, up-to-date information about technical and general tile data. Get access to company information about the suppliers (eg.points of expositionsmail) Compare prices of identical products offered by different wholesalers Download product and company data for local repository. Select an individual exhibition programmed out of a wholesalers programmed (stock +non-stock products) Search for products meeting the optical and technical requirements of a tender. Look for matching alternates to products required in a specific tender. Show a client different combinations/designs. Show a client how to get to the wholesalers showroom. Announce a visit of a client to the showroom (layer clients often select their tiles at the wholesalers showroom) Browse different showroom design suggestions (product combinations) Look for bargain offers/special object prices.
Get information about which products are about to be discontinued (to sell-off, update exhibition) Check whether ordered products are on their way. Download tile pictures for an offer/catalogue.
Architects would visit the website to Look for running tenders. Look for a tile matching certain optical and technical requirements. Learn about new technical solutions: new designs etc. Discuss technical problems with experts. See reference objects (laying plans, technical solutions)
Tile manufacturers The interaction scenario for the tile manufacturers like the members of the Spanish and Italian user groups are in general focused on the selling aspects. The manufacturers will access the e.bip market place to: Provide and distribute product information through the market place (additional on-line marketing channel) Find new international business partners (stone traders,wholesalers,tile layers) Inform potential customers about new products and changes in own product line. Inform buyers about order/delivery status. Transfer color information and tile pictures to their customers in order to reduce the physical shipping of sample tiles. Receive more bid inquiries. Negotiate the conditions of an order with their clients.
Coal Company Management Solution Thanks to new technology available, it is possible to exchange coal company information through an image capturing system installed at the end of the production lines of a manufacturers plant. The image acquisition is based on an image spectrometer system, which captures a line image and divide it in to its special components. Through a NSVKMS MBA College Visnagar 84
CCD B/W camera, frames can be acquired, containing the spatial information along the pixels of an axis and the related spectral information along the other direction. Based on the prism-grating-prism technique, the petrology can detect spectral intensities up to 1000 nm with very low loss and high image quality. The software developed for multi-frame spectral acquisition is the spectral scanner. Measurements of reflectance/absorbency and absolute spectral acquisition can be performed. The software calculates the CIE L*a*b* color co-ordinates of any point of sample and translate these in to RGB co-ordinates. The spectral scanner can obtain a spectral image of a surface through the acquisition of contiguous lines of a sample translation, depending on the optics coupled to the inspector. The system can also be applied to samples of very small or very big sizes. It is therefore possible to acquire color information of marble directly in the quarry or during manufacturing. The mean CIE L*a*b* and xyz colorimetric parameters can be obtained by selecting the desired area of the sample, allowing the comparison between different samples. The presence and the spatial distribution of impurities or particular compounds can be detected by viewing an image of the intensity for a selected wavelength. After coal company acquisition, it is necessary to convert all information in a true RGB image of the sample to avoid its representation on a monitor or its printing by a printer. The software is able to do this by calculating L*a*b* values according to the CIE standard and converting them in RGB values. The result is a bitmap file compatible with most operating system which can be sent and displayed anywhere. However, wrong monitor rendering can affect the reproduced image. To avoid this, coal company management is required. This requires an investment in an image capturing system to facilitate the information exchange between manufacturer and customers. Various options exist, namely: Zero cost option-no coal company management: Even without any sort of color management system, it is possible to send a sample image showing colors more or less similar to the real ones. In this case, the manufacturer is forced to send a physical sample to facilitate the customer decision. Low cost option: It is clear that a monitor needs to be calibrated to obtain the correct coal company rendering on the screen. Many systems can be applied. The simplest one is to manually adjust the monitor through the provided software. Comparing the coal company with sample color cards available everywhere at a very low cost (less than 5 ). Color book sets reproducing different color gradations (named RAL) are available free of charge in coal company shops.
Mid cost option: NSVKMS MBA College Visnagar 85
A small color detector based on an RGB sensor can be used in order to have an optimal monitor calibration, providing a true representation of a captured image. This sensor can be leaned to the monitor in order to check its potentialities and gives useful feedback for manual monitor calibration to the user. The cost of this gadget is 600 . High cost option: A more sophisticated system is to use a compact spectrometer (similar to the one used for image capturing). Calibration software performs all monitor calibration procedures automatically. It is necessary to use a probe during calibration and put it on screen for some seconds. A compact spectrometer is more accurate than a RGB sensor because of its better resolution. The cost of this equipment is 6000 . Presently the market size of ceramic tiles industry is around RS. 2000 core. The estimated production of ceramic tiles in India is presently over 109 million sum making it the 7th largest ceramic tiles producer in the world. The industry is characterized with a few key players in the organize sector and unorganized sector. The ceramic tiles industry statistics is shown in below.
13. Indian scenario:

Indian Ceramic Industry: Ceramic Industry in India is about 100 years old. It comprises ceramic tiles, sanitary ware and crockery items. Ceramic products are manufactured both in the large and small-scale sector with wide variation in type, size, quality and standard. India ranks 7th in the world in term of production of ceramic tiles and produced 200million sq. meters of ceramic tiles, out of a global production of 6400 million sq. meters during 2003-04. State-of-the-art ceramic goods are being manufactured in the country and the technology adopted by the Indian ceramic Industry is of international standard.
There are, at present, 16 units in the organized sector with an installed capacity of 21 lakh MT. It accounts for about 2.5% of world ceramic tile production Ceramic tiles industry has been growing at about 12% per annum. In India, per capita consumption of ceramic tile is 0.15 sq. mtr. Per annum compared with 2 sq. meters. Per annum in China and 5-6 sq. meter. Per annum in European countries. With the growthIn the housing sector the demand of ceramic is expected to increase. Indian tiles are competitive in the international market. These are exported to East and West Asian countries. The exports during 2003-04 were about Rs. 180 core. The ceramic tiles industry is classified into wall tiles and floor tiles (they are distinct and cannot be substituted for one another). The market for ceramic tiles can be further classified into two segments institutional (accounting for 60 per cent) and retail. The institutional segment is characterized by low operating margins, long credit periods and a high inventory turnover. The retail segment is characterized by high selling and distribution costs, and good margins and credit recovery. The ratio of the floor tile to wall tile consumption is 3:2. However, realizations on floor tiles are lower than those on wall tiles. Wall tiles cater to a very niche market, which is expected to grow at a higher rate due to its smaller base. Due to consolidation, the share of organized sector in ceramic tiles has increased steadily from 69 per cent in 1996-97 to 77 per cent in 2003-04 and most large players have undertaken capacity expansion plans. Thus, in the medium term, despite the steady demand growth, oversupply situation is likely to continue.
Policy: In the past, while the excise duty on ceramic tiles was 16%, the SSI units manufacturing mosaic tiles were enjoying excise duty exemption. However, with the rationalized excise duty structure, the price disparity between mosaic tiles and ceramic tiles has reduced considerably. There is an import threat to the industry as foreign players are more cost competitive. This threat for vitrified tiles from China & UAE is under check with anti dumping duty. The key drivers for the ceramic tiles in India are the boom in housing sector coupled by government policies fuelling strong growth in housing sector NSVKMS MBA College Visnagar 87
Outlook: Ceramic tile industry has been growing at about 12 per cent per annum. The demand growth for ceramic tiles is driven by the growth in the housing and commercial sector, increased use of ceramic tiles as flooring material and increasing share of organized sector (following greater customer preference for designer tiles and larger tile sizes). In the medium term, the demand for ceramic tiles is expected to increase in line with the expected increase in investments in real estate (housing and commercial).
The ceramic industry is undergoing a consolidation phase, with most small players closing down in recent years. Also, most of the companies are increasing their capacities. Though demand is expected to continue, the oversupply situation is likely to suppress its impact. The share of the organized players is increasing as the industry is moving towards consolidation to combat pressures on the costs front. During 2003-04, GAIL reduced supply of natural gas to ceramic tile manufacturers, which affected their production/ sales. As a result, the players have shifted to costlier fuels pushing up costs. Imposition of anti-dumping duty has benefited the domestic industry in comparison to international players as imports have declined. However in the medium to long run, if the current anti-dumping duty is withdrawn on account of adherence to WTO policies, there can be pressure on the players margins given the cost advantage of international players. With reduction in price disparity between mosaic & ceramic tiles due to recent government initiatives, the outlook for ceramic tile industry is likely to improve.
Ceramic tiles industry statistics: Table 13.1

WORLD PRODUCTION INDIA'S SHARE WORLD RANKING PER CAPITA CONSUMPTION GLOBLE INDUSTRY GROWTH RATE GROWTH RATE ( INDIAN DOMESTIC MARKET ) 4122.8 MILLION SQM 109.3 MILLION SQM 7 0.1 SQM 4% 12%
ORGANISED INDUSTRY TURNOVER WALL TILES SHARE FLOOR TILES SHARE VITRIFIED TILES & PORCELAIN TILES INVESTMENT IN LAST FIVE YEAR ORANISED SECTOR SHARE OF PRODUCTION NO. OF. UNITS UNORGANISED SECTOR SHARE OF PRODUCTION: NO OF UNITS WALL TILE SFARE FLOOR TILE SHARE VITRIFIED TILES & PORCELAIN TILES INVESTMENT IN LAST FIVE YEAR
RS 16.56 BILLION 42% 46% 13% RS 16. BILLION
56% 25%
44% 200(APPROX) 42% 46% 13% RS 16 BILLION
Indian Market with Its Present Scenario

In India, Ceramic tile industry emerged in the late 1950s. Ceramic Tile Industry can be Classified into three categories namely wall tile segment, floor tile segment and vitrified and Porcelain tile segment. In India the floor tiles segment is growing at a faster rate. The market For the wall tiles is rising at a relatively slower pace and this has resulted in high excess Capacity in the wall tile segment. The entry of two new product categories Vitrified tiles and Porcelain tiles have increased the size of the market considerably. It is expected that these Products will gradually take away the market from the conventional ceramic tiles (wall and Floor). As far as manufacturing of ceramic tiles NSVKMS MBA College Visnagar 89
is concerned, both the organized and Unorganized sector s plays a very important role in India. The per capita consumption of ceramic tiles in India is very less as compared to the other Countries in the world. It is as low as 0.15 sq.mtr per annum. This low per capita consumption Shows the likely demand that is going to arise in the future in India as more and more Development takes place. Ceramic Tiles are furnishing material apart from being utility or Hygiene products. Despite an overall slowdown of the economy this sector continues to grow At a healthy 12 percent per annum. Growth of the unorganized sector accounted for 44 Percent of the total production and the revenue earnings from the organized sector accounted To over Rs150 crore. India ranks 7th in terms of production in the world and the market share Of India have risen from 1.7 percent to 2.7 percent in terms of ceramic tile production. Potential for the Ceramic Industry in India Like developed markets the financial institutions (both foreign and domestic) are beginning to Show interest in the sector. Various foreign Real Estate and Finance companies like GE Commercial Finance, Tishman Speyer, Ascendas and Farallon Capital have entered the Indian Market. The Ceramic Tile Industry drives its demand from the Real Estate and Construction sector. Ceramic tiles find its maximum usage in residential and commercial buildings and are also Finding acceptance in other construction projects as well like airports, bus terminals etc. as They are found more suitable at places where there is more human traffic. In India the Construction sector is expected to do well in future mainly due to fiscal incentives given to Infrastructure development. India is the prime destination for the IT services out company. In the coming five years at least 55 million sq.mt of extra office space must be completed in the premium office space alone. Investment commission report states that the retail sales were $206 billion in 2004 and is Expected to grow three-fold in the next 10 years from $206 billion to about $660 billion by 2015. Organized retail was only $6.4 billion and is expected to grow rapidly to reach $100 Billion by 2015. Further India is expected to be among the top 5 retail markets in the world in 10 years. The Ceramic tiles particularly the vitrified tiles are finding increasing usage in both These sectors and the sector would benefit from an upsurge in these areas as well. Indian economy is poised to grow at 7-8 percent and with growing incomes and urbanization, Demand for houses is slated for growth. The increasing focus on rural areas, by government And corporate, the demand for housing would also increase in rural areas. The ceramic Industry will also benefit from the above developments. Increasing demand is just one part of The story the availability of Finance is the other part. With the availability of loans at low Interest rate and tax incentives have enabled the people to buy houses and build up their own Establishment. With the increasing NSVKMS MBA College Visnagar 90
competition amongst both Banks and Housing Finance Companies the people are avail of getting better financing options and that too at a cheaper Rate. Floor and wall tiles production fell for the second consecutive month in April. It went below the level of 55000 tones for the first time since November2003- 04. The demand for imported floor and wall tiles increased sharply during April Oct 2003. Import stood at 40642 tones as against 170 tones during the corresponding period of 2002.
Table 13.2 QQUATERLY FINANCIAL Jun-07 Sep-07 15.38 16.54 17.44 7.09 15.96 19.25
SALES GROWTH EXPENSE GROWTH PBDIT
Dec-06 9.08 11.47 0.12
Mar-07 4.56 2.46 14.57
Dec-07 17.25 17.48 17.52
Mar-08 20.06 23.34 5.51 91
GROWTH PAT GROWTH EXPENSES OTHER INCOME EXTRA ORP INCOME/TOTA L INCOME PBD MARGIN PAT MARGIN
-20.24 81.2 1.15 0.03
179.97 81.29 3.1 0.55
369.71 81.51 1.12 0
219.96 81.76 1.52 0.5
315.4 81.36 1.15 0
1.01 83.81 1.7 0.53
18.8 1.75
18.71 4.83
08.49 3.44
18.24 4.64
18.64 5.33
16.19 3.72
14. Growth strategy of the tile majors:

Buoyed by robust demand ceramic tiles producers in the country is company in an unprecedented Rs.500 crore of fresh investment to expand capacities. Companies that have planned expansion include H&R, Johnson, Katarina ceramics, Murudeshwar ceramic and spartek ceramic. These fresh capacities are set to go on stream between March 2004 and February 2005.
The proposed investment are the largest that the sector has witnessed after the rah of new capacities that were put up in early 90s. The proposed expansion will increase the existing installed capacity of 3 lack sqm per day by about 18%. The capacity expansion plans come at a time when inputs costs are on the rise and competition from import is stiff. In addition most of the tile producer had added to their capacities only recently. For instance Kajaria ceramics recently commission a mew plant at karaikal near pondichery with a production capacity of 4000 sqm per day. Sun earth commissioned its new unit at Maharashtra in 1998. Savanna ceramics merged with sun earth in February 2000. H&R Johnson acquired a ceramic tile plant of EID parry in Pondicherry in 2000. Table 14.1 Scaling up of various companies Company names H R Johnson Kajaria Murudeshwar Regency
Existing capacity 18000 20000 16000 28000
Proposed capacity 9000 20000 4000 50000
Expansion cost 89 125 60 75
The conversion of existing mosaic tiles to the ceramic tiles has also fuelled demand for ceramic tiles. The robust demand for the tiles has also translated into improved financial performance of industry majors. Almost all tiles companies have recorded healthy growth earning in the recent quarters. This has been despite as increase in energy costs and rising competition especially from imports.
15. Changes along path:

Ceramic tiles first manufactured in India in 1958 have come a long way. Today India is among the top 8 manufacturing countries in the world producing about 190 million sqmts 45% of this also consists of a large number of SSI units successfully nurtured by the Government of India for the past 50 years. As a foreign players the Indian tiles industry has ample of scopes to contribute by way of world production. apart from offering competitively priced products to the global and domestic markets there is much to be reaped through economies of scale by way of capacity expansion and large NSVKMS MBA College Visnagar 93
viable units especially in terms of additional employment opportunities lesser dependence on government and financial assistance an approved revenue collection system and a quantum leap in expert earnings to Rs.20 cores by 2005. The domestic industry has been fighting stiff competition from china as well as the problem of eroding margins over the last two years. Although vitrified segment has been growing faster than wall and floor net margins in the vitrified segment has been growing faster than and floor net margins in the vitrified tiles have groped from 15% in 2002-03 toward the last close of the fiscal as a result of cheap vitrified import being dumped in the market by countries like Indonesia and Malaysia in the pretext of wall floor products. It is expected that by the next fiscal the margin situation is going to be in the red. The cause of these eroding margins has been result of a high basis import duty on raw material coupled with the demand supply mismatch prevailing in the market as a result of overcapacities and dumping of cheap and standard quality imports from unscrupulous importers and traders. Current the basic custom duty applicable on import of raw material is 20% while the basic custom duty on the imported tiles has been reduced to 10% from selected countries including china. Thus this puts the local manufacturers in a position of great disadvantage via a Vis the importers as they have to sell locally manufactured tiles at a higher price as compared to imported vanities in the same segment and the current scenario is not conducive to any price rise. As per the CSO data production of the floor tiles has been increase marginally by 1.5% during April July 2004 this reflects largely modest growth. The government of India has put up anti dumping duty on the ceramic products originating from china thus safeguarding the Indian producers. It is estimated that good worth Rs.100 cores are being dumped in the Indian ceramic tiles market. Following the nationalization of import duties dumping of cheap imports is expected to rise by 100% during the coming years. As a long term measure uncontrolled export of basis raw material like feldspar, zircon, sand, etc. Should be restricted. Instead they should be converted to value added products.
16. Indian ceramic exports details:

With the total export figure of Rs.558 cores in 2000-2001 ceramic and allied products accounts for close to 4% of total exports under capexil. This product group has exhibited a healthy average of 28% yearly growth in the ten years period. This is more than an eight fold increase. Table 16.1 YEAR EXPORT(RS.CRORE) NSVKMS MBA College Visnagar
GROWTH 94
98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08
65 107 147 172 225 272 284 333 464 558
66% 37% 17% 31% 21% 5% 17% 39% 20%
Thus from the above figures it is clear that of ceramic has exhibited in general a healthy growth rate through in comparisons to the total world exports in this product range capexils share is low. Table 16.2 KEY STATISTIC EXPORT QUALITY EXPORT VALUE IMPORT UNITS TONNES RS. CRORES TONNES 2003-2004 4725 1.7 223 2004-2005 4916 2.7 125 2005-2006 3852 2.4 526 2006-2007 5382 2.9 277 95
QUANTITY IMPORT VALUE SALES VALUE MARKET SIZE DOMESTIC CONSUMPTION
RS. CRORES RS. CRORES RS.CRORES RS CRORES
0.8 1462.8 1463.9 1461.9
0.9 1699.4 1700 1697
2.6 1865.5 1868 1865.6
4.6 1626.3 1630 1627.9
Interpretation: It is seen from the key statistics export quantity has been increasing from year 1999 and reached to good heights in years 2003. The excise duty has been reduced slowly from 55% in 1994 to 16% in present situation. This shows a positive impact on the ceramic tiles industry since it adds to the country economy. In comparison to imported quantity we have a quite larger export quantity this shows that production is quite sufficing and appreciable to meet company demand. The import duty has been increase the domestic consumption.
Major export destinations from India in this category:

Table 16.3 SL.NO 1 2 3 4 5 6
COUNTRY SAUDI ARABIA UAE UK SRI LANKA GERMAN FED. REPUBLIC NIGERIA
EXPORT (IN LAC RS.) 8622.33 6634.75 4555.35 3275.42 2128.33 1999.11 96
7 8 9 10 11 12 13 14 15 16
MALAYSIA USA SOUTH AFRICA BANGLADESH KOREA SOUTH ITALY AUSTRALIA TURKEY SINGAPORE OTHERS
1868.85 1867.65 1176.53 1166.47 971.26 943.94 867.87 857.87 842.27 18048.89
Statistical data for the ceramic tiles:

Table 16.4 GROWTH& PROFITABILI TY YEAR
JUN-04 SEP-04
SALES GROWT H 38.58 32.64
EXP.GROW TH 45.67 40.11
PBDIT GROWT H 17.3 8.8
PAT GROWT H -40.55 -5.5
PBDIT MARGI N 21 18.94
PAT MARGI N 2.19 129 97
DEC-04 MAR-04 JUN-05 SEP-05 DEC-05 MARCH-06 JUN-06 SEP-06 DEC-06 MARCH-07
26.86 12.88 8.59 9.64 9.08 4.56 13.52 16.54 17.35 19.9
27.49 18.15 8.53 9.36 11.47 2.46 15.11 15.96 17.18 23.45
24.7 5.56 8.83 10.89 0.12 14.57 7.11 19.25 17.52 4.33
-7.11 -72.99 370.89 -21.37 -20.34 179.97 369.71 219.96 315.47 -4.73
21.84 17.56 20.08 17.95 18.8 18.71 18.8 18.24 18.64 16.14
4.05 0.33 1.08 1.9 1.75 4.83 3.49 4.64 5.22 3.7
Interpretation: It is being seen that sales growth was very good in the early years of 2006 but slowly it declined and referring to the facts of the years 2004. We can say that from June 2007 it has held constancy. This figures form a similarly even for the other terms. But a very huge gap was there in the year 2002. This constancy in sales growth consistency is because of decline in excise duty, which has positive, affected the exports.
Table 16.5
YEAR
PRODN. (TONNES) 60836 60380 61899 70691 50883 63800 59737 63043 64820 53709 66164 67530 64600
Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07 Jul-07
PRODN (% CHG) 16.38 -7.98 8.72 22.1 -5.37 -4.38 -6.01 8.46 -4.91 -12.49 4.75 7.24 6.19
DEMAND& SUPPLY FOR THE COUNTRY IMPORTS IMPORTS (TONNES) (% CHG) 149 25 40 9 38 109 99233.33 82.62 44.83 -13.38 1604.04 1792.36
EXPORTS
EXPORTS (% CHG) 161.84 19.53 270.21 -23.63 -82.49 -80.25 84.56 470.6
324 307 261 726 177 106 832 790
Interpretation: It is been seen that the production of the ceramic tiles has been comparatively increasing slowly and gradually from year 2003 to June 2004. The imports of the imported till has been reduced and the export made by the various companies have gradually increased.
17. Details of the top companies of India:

Now, referring to the companies which are currently performing well and have a good bran image in the market are discuss below. This will even give the idea about current scenario of CHANGES made in the ceramic tile continuously it gives the detail about the companies HR JOHNSON Table 17.1 GEOGRAPHICAL PLANTS WALL AND FLOOR TILES (BRAND NAME) VITRIFIED TILES (BRAND NAMES) INDUSTRIAL AND PAVEMENT TILES (BRAND NAME) COMPANIES TURN OVER MARKET SHARE: WALL TILES VITRIFIED TILES FLOOR TILES EXPORT TO DIFFERENT COUNTRIES INNOVATION
PLANT IN FIVE DIFFERENT PARTS OF THE COUNTRY JOHNSON TILES AND EXCEL TILE RESPECTIVELY MARBONITE ENDURA 3 BILLION 30% 25% 20% 43 COUNTRIES KITCHEN TILES (4*4) ANTISLIP TILES (8*8) BATHROOM TILES JOINT FREE TILES USED AS A FLOOR AND WALL TILES DEALER 800 SUB DEALER 7000 WAREHOUSE 20
DISTRIBUTION NETWORK
ASIAN GRANITO TILES: Table 17.2 GEOGRAPHICAL PLANTS 1) OLD PLANT 2) NEW PLANTS DISTRIBUTION NETWORK MARKET SHARE ACQUISITION
IDAR HIMMATNAGAR DEALER 500 DISTRIBUTORS500 FLOOR TILES 12% WALL TILES 19% ASIAN TILES GET GOOD PLACE IN THE CERAMIC TILES INDUSTRY
3). KAJARIA CERAMIC TILES INDUSTRY Table 17.3 NSVKMS MBA College Visnagar 100
GEOGRAPHICAL LOCATION
PRODUCTION RANGE
STRONG PRESENCE NET PROFIT MARKET SHARE DISTRIBUTION NETWORK (WESTERN AND NORTHERN REGION)
AHMEDABAD 12500 TPA MANUFACTURING CAPACITY NEW PLANT DELHI 5000 SQPD APRIL 2004 KAJARIA TILES KAJARIA CERAMICS KAJARIA DRANITES VITRIFIED GRANITES SOUTH AND WEST INDIA 50% 180% FY 06, 110% FY 07 16% OF THE INDIAN MARKET 20% VITRIFIED TILES 50 SHOW ROOM 35 DEPOT 18 SHOW ROOM 12 DEPOT
H&R JOHNSON:
H. & R. Johnson (India) Limited is India's No. 1 tile company offering a wide range of wall and NSVKMS MBA College Visnagar 101
floor tile products across various segments viz. wall, floor, vitrified, exterior applications and industrial applications. The company also caters to customer needs in sanitary ware and bathroom accessories segments. As a member of Johnson Ceramics International, UK, the global leader in the international tile industry, we have access to the latest trends and designs prevalent in the international market. With a vast portfolio comprising 5 well-known brands in India (Johnson, Marbonite, Porcelain, Endure & Milano) the company provides the most innovative products meeting international standards.
We have state-of-the-art machinery at company manufacturing plants located at Dewas, Pen, Kunigal and Karaikal. All company plants are ISO compliant with both 9001, 14001 certifications, as well as OHSAS 18001, which is given for excellence in safety standards.
Performance & Growth: Company Performance - India Riding on superior product R&D and high marketing spends; we propelled company annual revenues to Rs 9260 million in 2006-2007 recording a growth of 25% over the previous years figures. Company sales volume during the year crossed 32 million square meters. Company strong performance is demonstrative of company unique growth profile, high brand pull and a proven track-record to deliver on company expansion plans. The success of company innovative brand strategy supports company move to continue expanding company business both through organic companies as well as developing inorganic growth routes. During the current year, we are driving a revenue target of Rs 12,000 million with 30% growth rate. A strong distribution and sales network, robust production, infrastructure and ability to predict, prepare us for future growth.
Company Future Plans: As a part of company aggressive expansion plan, we have set company eyes keenly on the rural markets in India including Class B and C towns. While company existing distribution network is strong enough to cater to any customer requirement, we are targeting 30% growth of company distribution network in these rural markets. Company rural market foray is part of company strategy to achieve Rs. 10,000 Million turnover. Company rural operations are expected to contribute at least 25% of the total turnover.
Companys products: Bathroom Fittings Instant Shower Systems Kitchen Sinks Sanitary Ware Shower Enclosures Shower Panels Metallium Marbonite XL 700 x 700 Wonderwall Wonder Wall Border Series 4 x 2 Stonex Unimaginable Splendour Projectline Collection 4 x 2 Slabs 3 x 3 Slabs 2 x 2 Coloured Marbonite 2 x 2 Regular Marbles Border Range Floor Range Motif Range Wall Range
Asian granite ceramic tile:
Asian Tiles Limited has been churning out tiles since year 2000. Which have manufacturing facilities at IDAR (Gujartindia) and their products are well accepted in the market. Asian Granito has its manufacturing facilities at ceramic zone, Sabarkantha district, Gujarat India. The dynamic & experienced entrepreneurs Mr. HASMUKH PATEL and Mr. MUKESH PATEL are the promoters and display acumen, exuberance and professionalism. Their in depth knowledge, farsighted business policies, has strategically positioned Asian granite as Indias leading manufacturer of vitrified tiles. Driven by innovation and passion to excel, Asian Granito provides the most exotic and aesthetic range of vitrified tiles in sprawling designs and Asian Granito is the formidable choice of architects, interior designers, constructions companies and customers due to the distinctive product range that comes with irreplaceable quality of the international repute.Highly acclaimed for quality, our products are popular in India and overseas. At Asian Granito modernization plays a pivotal role we embrace technological developments; changes are made in the technology and processes to meet the constantly changing requirement of clients. Our sophisticated manufacturing facility comprises of highly advanced technology and experienced workforce. Asian Granito takes pride for installing its manufacturing units with Indias longest roller kiln, Indias first horizontal dryer from SACMI and biggest press 3590 from SACMI, Indias biggest ball mill.
Table 17.4 Sr no 1 Product Vitrified tiles Pack size 808x1212mm 925x925mm 605x605mm 2 Vitrified Rustic 605x605mm 301x605mm 301x301 3 4 5 6 Rubusto.G Porcelano Tiles Aquamosaic Future wooden tiles Future stone tiles Future bamboo tiles Grandura Aquart Future line tiles 618x618mm 618x618 405x405mm 308x616mm Max retail price 700 600 500 600 500 400 550 650 500 800
7 8
308x616mm 308x308
650 500
9 10 11
300x300mm 300x300mm 308x616
400 375 650
Kajaria ceramic tiles ltd:
Achievements for Kajaria are not just about being number one brand; the company is conscious of its social responsibilities and committed to improving the quality of life. In 2001 Kajaria became one of a handful of companies in India and the only one in the tiles industry to adopt a formal environment policy. To fulfill this obligation Kajaria undertook extensive product reformulation, process modification, equipment redesign and re-cycling and re-use of materials. For this it was bestowed the ISO 14001 certification. The company was awarded the prestigious OHSAS 18001 for fulfilling international standards in occupational health and safest management system specifications. Its no surprise that Kajaria Ceramics is also amongst a very few ceramic tile companies in the world to get this certification. It was also the first company in the ceramic tile industry to receive the ISO 9002 certification confirming its adherence to global standards of quality.
The world Economic Forum has also selected the company as one of the top performing Global Growth Companies from India. The latest feather in the cap is that we have been selected as the Business Super brand. Each of these recognitions has spurred the company to outperform itself.
Kajaria Gailpur is the only plant in India to have the following four ISO Certifications
KAJARIA Ceramics exports to more than 20 countries round the Globe. The International Marketing operations are organized by a specialist export division that manages a network of international agents and distributors supported by our exclusive office/showroom in UAE. Now in international markets we enjoy a similar brand Recall as that of Domestic. Brand "Kajaria" has today become synonym of Quality, service and innovation not only in the domestic market but even in the international market. "Kajaria" products are also well accepted in European market. With increased capacity, increase in turnover and a growing domestic and exports market, Kajaria Ceramics is set to emerge as a leader in the international ceramic tiles market. Company would be very happy to receive your inquiries, please contact:
Due to our Packaging company are able to minimize the loss due to breakage in transportation. Each box of tiles is packed in a Cartoon and then each box is SHRINKED wrapped to ensure safety of the material. Then these boxes are loaded on the pre designed EURO Pallets, secured heavily with Plastic straps. The container stuffing is also done in the presence of experienced personnel, to ensure best stuffing and maximum material can be loaded.
Now company have standardized the quantity, which can be stuffed in a Container, which is listed below:Table 17.5
Dimensions Thickness in mm (In mm) 300 x 300 F 400 x 400 F 395 x 395 F 300 x 200 W 200 x 200 W 250 x 400 W 7.7 9.0 9.0 7.0 6.6 8.1 Piece/Box(No.) Coverage Wt./Sq.Mt. Load No. of Box (Sq. (Kg.) ability in boxes in Mt.) 20 Ft FCL 20 Ft, FCL 15 8 8 15 25 10 1.35 1.28 1.248 0.90 1.00 1.00 15.65 19.50 19.5 12.6 12.20 15.3 1714.5 Sq. Mt. 1331.20 Sq.Mt. 1297.92 Sq.Mt. 2061 Sq.Mt. 2150 Sq. Mt. 1680 Sq. Mt. 1270 1040 1040 2290 2150 1680
18. Gujarat As A Special State For The Production: This includes a 10.2 per cent growth rate by March 2007, on the one hand, and the lifting of some one lakh families that are handpicked from 20,000 villages from below the poverty line. While the doubling of per capita agriculture income from Rs 8,000 to over Rs 15,000 over the next three years is but a natural corollary, Mr. Modi plans to set up five agro export zones across the State. The culmination of this process would be the erection of Asia's largest cold storage zone in the Dahej Special Economic Zone (SEZ) in south Gujarat, so as to create a link from the farm gate to the international customer for mangoes and other horticulture produce. "The Vibrant Gujarat meet was just the beginning and the floodgate of investments to the State has been opened. We had a Chinese company firming up plans to put up a ceramic tile manufacturing plant in Gujarat at an investment of Rs 55 crore on Monday. Later this week, Mr. Lawrence R. Klein, a 1988 Nobel laureate in economics, is coming to meet me along with Mr. Polk Carey, Chairman of the leading US investment banking firm, WP Carey & Company. Clearly, it is not merely a courtesy call as they also would be talking business," Mr. Modi said. For those who have been picking holes in the investment proposals worth Rs 65,000 crore that were signed at the Vibrant Gujarat meet, Mr. Modi's response is that there is nothing non-global about Indian companies investing in Gujarat. On the other hand, two more Chinese firms that are mulling fresh investment in Gujarat include a twowheeler company and a machinery manufacturer for the ceramic tiles industry, the latter considering an export-oriented plant along the coast in Kutch district. Reportedly the government of Gujarat is taking initiatives on improving the competitiveness of the ceramic tiles industry. It has identify the for cluster Kutch, Rajkot, Morbi, Mahesana and Himmatnagar for the development of ceramic industry. It has plans to set up a gas based power plant which will lower power cost curing the industry. Morbi, 62 kms from Rajkot has 300 mosaic tiles factories of which 90 running. Owners of more than 40 of the 90 factories want to close because of their losses mounting. But the industry has a real threat to industry from the ceramic tiles. Ceramic tiles are light and can be fixed without much hassled on the floor. Tills the early 1980s, slowly but steadily the ceramic were industry has grown in the state of Gujarat, because of location advantage; technology advancement has contributed to its growth and product diversification. With major group taking of from the early 1980s, currently it occupies the second position after Uttar Pradesh in India. NSVKMS MBA College Visnagar 111
Ceramic clusters Ahmadabad: There are 950 ceramic units in ceramic clusters in Gujarat and all are family base. Most of these clusters are poor in knowledge but have a high entrepreneurial spirit. To server this clusters units and cater to the need of the ceramic industry in the small scale sector of Gujarat and ad joining areas, central glass and ceramic research institutes (CGCRI) NARODA center Ahmadabad, one of the contiguous laboratories of the council of scientific and industrial research (CSIR) was establish in 1977. To improve the skill in these units, training and main power development programmed were initiated in 1978. Institute conducted 32 technology development programmed and trained 600 people; it has also conducted three entrepreneurship development programmed to encourage new enterprises. The cluster at Morbi, himmatnagar and mahesana has benefited a lot in technology development from CGCRI. It has been able to use the fly ash (highly polluting waste products in the manufacture of the ceramic tiles. Ceramic tiles now contain 30% of the raw material as a fly ash. It has also been able to produce the blue ceramic tiles, which are free from the lead. Ceramic filters candles have been developed which also contain 20% to 30% of fly ash. Cotton wick of the kerosene oil lamp has been replaced by the permanent ceramic wick, which need to replace at all. It has developed the technology for production of Bone china utilizing the china clay of Gujarat.
Thus it can be said Gujarat will be a good production house for the ceramic tiles.
19. Indian Council of Ceramic Tiles & Sanitary ware

Budget2008-09:
Issue I: Rationalization of Excise Duty on Ceramic Tiles:

Ceramic Tiles are classified under Chapter No.69 of the Central Excise Tariff Act and they attract Excise Duty @ 16%. However, since this product is one of mass consumption, especially by rural population, the rate of Excise duty needs to be rationalized. While we appreciate the Central Governments thrust on rapidly developing infrastructure including the housing sector especially in the rural areas, this objective will receive a major boost if the duty on Ceramic Tiles is reduced from 16% to 8% in the tariff itself and in line with the Excise Duty tariffs prevalent on products used by the housing industry like building blocks, wood articles, mica articles (vide Notification No 10/2006), roofing tiles (vide Notification No 36/2006). You will appreciate development of housing sector is a thrust area of both the Central and State governments. However, it is noticed that several products of non-thrust areas like footwear, textile, pressure cookers, imitation jewellery (vide notification no 5/2006), sunglasses, audio cassettes, toothbrushes (vide notification no 10/2006) are classified at 8% Excise Duty. It is needless to mention that India being a developing country, constructing a house is a result of a lifetime savings for the individuals it is, therefore, important that Ceramic Tiles are made available at affordable prices. The Indian Ceramic Tile Industry has already has passed almost all the benefits derived out of optimization of the industry to the consumer by cutting down tile prices to the maximum. Here, it is relevant to note that the prices of tiles have been cut year-onyear despite substantial increase in the raw material and other input costs. In this scenario of competitive pricing, the local manufacturers have survived only due to increase in sales volume. This is visible from the fact that size of the Indian ceramic tile industry was about 220 million sq. meters. In the year 2003 which has now increased to 303 million sq. meters in the year 2005. As ceramic tiles have extensive usage on walls, floors, kitchen and washrooms in a house. The aforesaid objective of the government will not receive the desired impetus till the Excise Duty structure is not rationalized.
Council Main Request: We appeal to you to rationalize the current Excise Duty applicable on ceramic tiles from 16% to 8%. Given the increased volumes year-on-year, it is safe to assume that inspire of the Excise Duty being reduced from 16% to 8%, the overall Excise collection of the Government from ceramic tiles is only likely to only increase as the consumption volumes are bound to shoot up further. Moreover, the objective of the Government to give a fillip to the housing sector especially rural housing sector will be achieved. It is relevant to point out that there are several products existing in the housing sector, which currently attract 8% duty and are also allowed to avail the benefit of Canvas. Alternative Request: In the event our aforesaid request cannot be considered sympathetically we pray that the condition No.7 to Notification No.5/2006 be deleted so as to enable the Ceramic Tile Industry to avail Canvas Credit and to discharge Excise Duty @ 8% for clearance of Ceramic Tiles, manufactured in the factory not using electricity for firing the kiln. We sincerely hope that in line with the Governments Policy giving a major thrust to the housing sector one of our request will be favorably considered. Issue II: Anomaly of Inverted Duty Structure: Council appreciate the efforts made by the Union Government in correcting the anomaly of inverted duty structure as far as inputs and raw materials are concerned. However, we wish to draw your attention to a live situation where inverted duty structure needs to be corrected by taking the example of Ceramic Rollers. Ceramic Rollers is a raw material that is largely used by the Indian ceramic tile industry in the manufacture of tiles. A very small portion of ceramic rollers is also used by roofing tile industry. Out of the total import of Ceramic Rollers, approximately 99 per cent of the ceramic rollers are used by the ceramic tile industry while the balance 1 per cent is used by the other industry i.e. roofing tiles. It is important to point out here that just because 1 per cent of the imports are by the roofing tile industry, it would be unfair not to correct the anomaly of inverted duty structure for this particular product and let the ceramic tile industry suffer. Moreover, it should be noted that China is the largest manufacturer of tiles in the world. As China is a non-market economy several types of assistance, concessions, aids etc are available to the ceramic tile industry. This gives them an unfair advantage NSVKMS MBA College Visnagar 114
over the Indian ceramic tile industry. As a result, import of ceramic tiles from China is much cheaper and is therefore in huge volumes.
Council invite your attention to the following chart, which is self-explanatory. Raw Material Basic Custom Duty On Consumption (%) Basic Custom Tiles Imported From By Ceramic Duty on Raw By China as per Bangkok Tile Materials Others Agreement Industry 99% 90% 90% 70% 1% 10% 10% 30% 7.5% 12.5% 10% 10% 5.37% 5.37% 5.37% 5.37%
Raw Material Name Ceramic Rollers Ceramic Color Frit Boric Acid
Custom Tariff Heading 69039090 32071040 32074000 28100020
Raw Material Name
Custom Tariff Heading
Abrasives 68042190 Dies & 82073000 Punches 68041000 Diamond (Wheels) Cutting 68042110 Tools (Rollers)
Raw Material Basic Custom Duty On Consumption (%) Basic Custom Tiles Imported From By Ceramic Duty on Raw By China as per Bangkok Tile Materials Others Agreement Industry 65% 35% 12.5% 5.37% 55% 45% 12.5% 5.37%
50%
50%
12.5%
5.37%
In the aforesaid chart you will kindly observe that just because a small portion of the import of raw materials is by industries other than Ceramic Tile Industry, the anomaly of inverted duty structure on these raw materials is not being corrected. We humbly submit that this is drastically hitting the Rs.4500 Crores Indian ceramic tile industry as against the other industries, which are relatively smaller in size. We request you to kindly look into this and correct the situation for us.
It maybe noted that the afore-mentioned list of raw materials is primarily consumed by ceramic tile manufacturers to manufacture tiles. The existing anomaly provides an unfair advantage to the trader who imports tiles (finished products) directly from China resulting in great de-motivation to the local manufacturers. This is not helping the domestic manufacturer in any manner as the government through its Notification No 72/2005-CUSTOMS dated July 22, 2005 has already given an additional concession on custom duty to ceramic tiles (i.e. the final product) imported from China. Consequently, ceramic tiles falling under Customs Tariff sub-heading Nos. 6907 and 6908 are now allowed for import from China at 5.37% Basic Custom Duty as against the higher Tariff rate applicable on import of the afore-mentioned raw materials. The implication being that, the domestic manufacturers importing raw materials used in the manufacture of ceramic tiles have to pay a higher custom duty compared to an importer importing finished tiles from China at 5.37% basic custom duty. Such unfair custom duty structure provides the tile importer an unfair price advantage over locally manufactured products. This will definitely sound the death-knell for the local manufacturers and thwart fresh investments being made in the industry. Council Request: It is imperative that the Basic Custom Duty on raw material should be kept lower than the Basic Custom Duty on finished goods, so that an impetus is given to the local manufacturers, fresh investments are encouraged and a level playing field is created. We request you to take up our case with the government to lower the duty on raw material and intermediate to 5% or less thereby creating a level-playing field for the local manufacturers and permit the ceramic tile industry to take Cenvat of input duty paid. Issue III: Low Abatement on MRP Ceramic tiles are assessed to Excise Duty on the basis of MRP. Presently the abatement on MRP for the purpose of calculation of excise duty is allowed at the rate of 45%. Given the high costs pressures that we are operating on, this abatement is insufficient. This low abatement is hampering the industrys competitiveness. Here, it is pertinent to note that with the increasing middle class population in the rural and semi urban areas, the ceramic tiles have to be transported at longer distances from the location of manufacture. This increases the transportation cost substantially as tiles are bulky material.
This increase in abatement will help us in making our products more affordable to the masses and the huge rural population can improve their quality of life by using this hygienic product. A chart containing various factors which determine abatement is enclosed and marked as Annexure 1. On going through the same you will observe that an abatement of 50% is justified.
20. Analysis of ceramic tiles industry Driving forces:

Industry and competitive conditions change because forces are in motions that create incentives or pressure for change. The most dominant forces are called driving forces because they have the biggest influence on what kind of changes will take place in the industrys structure and competitive environment. 1) A shrinking market growth heightens competitive pressures producing an often intense battle for the market share and inducing mergers and acquisitions that result in industry consolidation to a smaller number of participants. The same evenly implies to the ceramic tiles industry as companies like sun earth, H R Johnson and many other have made a number of acquisitions. 2) Product innovations can shake up the market structure of competition by broadening an industrys customer base, rejuvenating industry growth and widening the degree of product differentiation among the rival sellers. Continuous innovations are being brought out for attraction of newer segments in the market. As for example bell grantee has brought out for attraction of newer segments in the market. As for example bell grantee has brought out with 3ft * 3ft tiles which are able to replace the slabs of natural stones. 3) Abundance of the raw material is available in our country, which is essential for the production of the ceramic tiles. Materials like zircon and feldspar are exported in large quantities by our country.
1) Skillful labor require for the production of ceramic tiles is even available this increases the production rate. 2) E.bip concept has been now raised up globally which has made the procurement of the ceramic tiles and the supply scenario completely wide and good. NSVKMS MBA College Visnagar 117
3) Housing sector is connected to the overall growth in the economy; it has as witnessed significant growth during the last few years due to declining interest cost, steady real estate prices, increased urbanization and fiscal incentives provided for tax purpose. The housing sector is set to grow at an annual rate of 50% for the next 4 years. This would thereby carry a promising future of the ceramic tiles also. 4) Due to decline in demand for funds from industry side and the retail in the banking sector and the price war to acquire critical mass have helped more people to banking sector and the price war to acquire critical mass have helped more people to decline in demand for funds from industry side and the retail finance boom in the banking sector and the price war to acquire critical mass have helped more people to afford home loans. The rising salaries in Telecom, IT, Banking coupled with cheaper availability of finance have turned more people debt friendly. The main drivers in the commercial market segments have been IT companies, biotech companies, BPO. 5) Ceramic tiles environmentally scored well over their counterparts (marble, granite, mosaics etc) due to its practically pollution free due to its practically pollution free manufacturing. This resulted in a sort of boom in the industry. Single roller firing, this is the most modern technology in the production of tiles today. The advantages are higher productivity lower fuel consumption and reduced losses. Technological developments can also produce competitively significant changes in capital requirements minimum efficient plant sizes, distribution channels and logistics and learning curve effects.
The competitive strategy:

There are different business approaches and initiatives which undertakes to attract the customers and fulfill their expectations, to withstand the pressures and strengthen the market position. They are as follows: 1) A low cost strategy appealing to a broad spectrum of customers based on being overall low cost provider of product or service. 2) A broad differentiation strategy seeking to differentiate the companys product offering from rivals in a way that appeal to the broad spectrum. 3) A best cost provider strategy giving customers more value for the money by incorporating good to excellent product attributes at a lower cost of the rivals the target is of all attributes at low cost. A focused strategy based on the differentiation concentrating on a narrow buyer segment and out competing rivals by offering niche members customized attributes that meet their tastes and requirements better than rivals product. As ceramic tile is having number of application, from past to this present scenario. Areas of application 1) esthetic value 2) surface subjected to wear and tear 3) Under water/for flashing purpose.
Initially they were only used for the flooring purpose, but gradually with the creation of glazed ceramic tiles they are used for cladding of walls in baths, toilets, and kitchens as well as in decorative purposes. They are used in swimming pools and some water resistance and durability. Not only on an average in the Indian households but it is covering even medical centers, labs, milk booths ,schools, public conveniences and countless other centers surrounding us. So be more competitive and to cover the sections of its substitutes like marble, granite, terrazzo etc, it is becomes necessary for the ceramic tile industry to have a competitive strategy which would give it a broad section of buyer and have broad spectrum of buyers. So it is to follow the broad differentiation strategy, by following the strategy the companies would have chance for commanding a premium price & increase its unit sales.
Pest analysis:
Political Factors: (Government, Legal, and Legislations) Antidumping duty: Government of India has laid antidumping duties on countries like china, Indonesia and Malaysia. Because of the imported product available at cheaper cost the domestically produced tiles was being negatively affected. Thereby safe guarding the Indian producer, anti dumping duties are beneficial. Excise duty: The excise duty on the ceramic duty has been on downslide. From as high as 55 % in 1994 it is brought to 16%. This has helped the industry to have a growth rate of 12% year on year making it best amongst other comparable industry. Uncontrolled export: As a long-term measure uncontrolled export of ten aw materials like feldspar, zircon, sand etc should be restricted. Instead they should be converted in to the country and even reduce the chances of shortage in our country. Thus proving beneficial to the country. Custom duty: Currently the basic custom duty on import of raw materials is 20% while the basic custom duty on the imported ceramic tiles has been reduced to 10 % from selected countries including china. This puts the local manufacturer in a position of great disadvantage vis a vis the importers as they have locally manufactured tiles at a higher price as compared to the imported varieties in the same segment and the current market scenario is not conducive to any price rise. Housing policies: Government is boosting the housing sector for which various schemes for the loans and policies are being raised up. Moreover it is been even seen that the housing sector is one adding to the economy of the country, so if the consumers are NSVKMS MBA College Visnagar 121
directed towards the ceramic tiles owing to several factors ease in laying ability, versatility, low price and the most important hygiene. This will have a positive impact on the industry.
Import duty: The Indian council of ceramic tiles and sanitary wares are suggesting waving the import duty on raw materials transferring ceramic tiles group ii of Bangkok agreement and making BIS specifications mandatory for imported tiles.
Various agreements: Today India is in among the top 8 countries producing ceramic tiles of the world, which is about 190 million sq meters, 45 % of this also consists of a large number of SSI units successfully nurtured by the government of India for the past 50 years. Hence, immediate steps should be taken to protect the domestic industry being swept away due to implementation of the WTO agreements, Bangkok agreement, and indo-silence agreements.etc.
Economical factors: Manufacturing process: Unlike other counterparts the manufacturing process for the ceramic tiles is pollution free. This provides not only concern for the environment but also tries to emphasis, that technology related to it is being continuously updated to make it ecofriendly. Transportation expenses: Mosaic tiles are heavier and expend more on the transportation; while ceramic tiles are lighter therefore more number can be transferred in shorter span of time. This reduces overall transportation cost. Production units: The production unit size in India as compared to the globally producing units is lesser which makes a hurdle to expand its work and further be a fully fleshed firm with all the amenities. Per capita consumption: In India the per capita consumption is as low as 0.1 sqm compared to 3 and 5 sqm in china and Europe, respectively. Rising the disposal incomes of the growing middle class and 40 million units of the housing shortage, however hold out a great potential.
Social factors: Religious facts: The holy temples of swaminarayan and jain religion still prefer and use marble of higher quality for the construction purpose. This reduces the demand for ceramic tiles at this juncture. It is even supported by the comment that marble granite is natural stone. The swaminarayan maths in Darjeeling is best examples of red stones, the palitana temple of Janis are the best examples of tile substitutes. Psychology of groups: Still there are groups of people in our society who believe that marble, granite and other few stones are adding prestige to their status and living style. This decrease a segment of the society that is unaware of the ceramic tiles and their special characteristics making it put behind its substitutes. People still carry the fear from slipping and skidding over on the ceramic tiles. Myth: There has also been a belief that marble becomes cooler and needs to be taken care during its usage in the winter season when it becomes very cool. It is also considered that the marble is pure and used in temple only, not for housing sector.
Technological factors: Technology: it would not be out of place to mention that we not lagging behind in technical know how which compares favorably with the newer international standard and since our newer technologies of fast firing have made the industry highly capital intensive. As per the latest trend the single roller technology is also being used in our country for the production of the glazed and unglazed ceramic tiles. Furthermore, this new technology also allowed the production of high quality, low water absorption tiles of larger dimensions and different shapes and colors. Design and application of computerization was easily embedded in the production process, and an increasing variety of new high quality products flooded the market afterwards.
Energy Efficient Bell Kiln for the Ceramic Industry In ceramic industry, glazing kilns consume significant amount of electricity to produce heat. Conventional electric kilns use heating elements embedded in the top or in the walls of the furnace. Therefore, heat loss from the outer casing of traditional glazing kiln is a major disadvantage leading to inefficient energy utilization. A new glazing kiln has been designed using infrared radiation produced by the heaters, which are brought straight in to the heart of the kiln charge, via as short a distance as possible. The most important feature of the new kiln is that it is fired by MoSi2-glowing elements suspended between the charge stacks. The distance between the slack and the elements is around 400 mm.because of the high temperature of the elements (1600 c); the infrared radiation penetrates the charge stack faster and deeper than in the old situation. The kiln itself has been designed for optimal energy consumption, i.e.1.the mass is kept low by using a light insulation, 2. Wall thickness has been optimized with regard to heat accumulation and insulation NSVKMS MBA College Visnagar 125
and, 3. There are no heat conductors between the elements and the walls. Further, this kiln has additional advantages due to the even temperature distribution, reduced rejection of products and also contributing to energy saving. For a given production volume, the new kiln requires only 60% of the firings required by the old kiln, so total saving for a given production volume is around 53%. There are also additional unquantified benefits resulting from reduced maintenance and operational costs.
Innovations: Recently H R Johnson the leading company in India and globally has put up a new type of the tile, which is proving and providing the property of water repellence. This is technology, which works behind for all this. This makes newer segments and attract GAP Analysis: The GAP analysis shown on Table on the next page compares major ceramics producing countries rated by quality and technology capabilities. The ceramics industries in these countries have developed into three groups. The Group A comprises those countries with no major weaknesses in technology or marketplace, although the technology base in the U.S is eroding slightly as more graduate engineers head into high tech industries rather than the traditional ceramics-producing sector.
groupA Country/region Italy Spain Germany USA Group B Sri Lanka United Kingdom India Indonesia China Group C Thailand Technology Very high Very high High High/ medium Medium/low Medium/low Medium Medium High Medium Skill Medium medium Medium Medium Very high Medium/low Very high Medium Low Low attitude High Medium High Medium High Low Very high Medium Low Medium Aesthetic quality High High Medium Medium High High/ medium Very high Medium Medium High Technical quality High High Very high Medium Low Medium Low Low Medium Medium Test &control Very high High High High Low High Low Low Low Medium Cleanliness High/medium High/ medium Medium Medium High Low High Low Low Low Rating 1 1.5 2 2.5 3 3 4 4 4 5
South Africa Turkey Philippines
High/ medium Medium Low
Low Medium Low
Medium Low Medium
Medium Low Low
Medium Medium Low
Medium Medium Low
Low Low Medium
6 7 9
Group B is a combination of emerging and declining manufacturing countries. Labor costs and a slightly declining technology base hinder the industry in the UK. Indonesia and China are emerging, but are troubled by growing pains and indifferent product quality consistency. Sri Lanka is just beginning to brand products and take advantage of its skilled labor force. Indian village falls into Group B because of its extremely high aesthetic quality, dedicated workforce and high-level of manual skills. The technology used is judged adequate for the product produced with the exception of the many outdated coal burning kilns/furnaces in use. The highest quality Indian ceramic is among the best in the world but there is a wide difference between the top and the bottom quality wares produced in the village. Information for this GAP Analysis has been obtained primarily from Dr. John Mooney who has 45 years of experience in assessing ceramics, as well as a variety of secondary and local information from Vietnam.
Diamond Analysis: The Porter Diamond is a strategic tool used to analyze the competitiveness of firms, industry clusters and regions. Fortune 500 companies and governments in many parts of the world have used it as a diagnostic tool to identify opportunities to improve competitiveness. The tool was based on the findings of extensive research that identified key factors explaining competitiveness of industry clusters in widely varying national environments. For further information on Diamond Analysis, we should refer to Dr. Michael Porters key work on this strategic tool. The diamond analysis given in on the next page demonstrates the four determinants of competitiveness in the context of India ceramic industry. Demand conditions: Demand conditions are high. The Indian ceramics cluster lacks direct contact with sophisticated and demanding consumers. Local Vietnamese demand does not normally anticipate or lead demand elsewhere in the world. Hence, the producers in Indian can get direct and immediate signals on the latest designs and consumer trends, or information on how to adapt products to gain substantial increases in margin. Family companies have only had the ability to export directly in recent years. However, increased tourism in India is now exposing Indian to direct contact with buyers and some international consumers.
Strategy (-) Limited innovation and strategy (-) Undifferentiated competition (+) Some innovation emerging (-) No branding; limited marketing (+) Nascent cluster business association
Production Factor Condition contact with
Related and Supported Industries (-) Lack of direct Sophisticated and
demand Customer (+) Exporesure through Basic (+) Local supply of clay and information Kaolin (+) Talented artisans; 1000+ Years of tradition (+/-) Adequate road Infrastructure (+) Well-trained and industrious to Workforce (-) Coal as energy source Advanced (+) Unique design skills if artisans (-) Poor product consistency (-) Lack of process standardization NSVKMS MBA College Visnagar 129 increased tourism (-) Poor use of Related and Supported Industries infrastructure
(-) imported kilns and limited local capacity improve technology (+/-) Local R&D and university linkage (-) Limited packaging (+) Natural cluster in Indian
A few of the more dynamic producers are using the Internet to identify customers and learn about international market conditions. Bridges of information and communication need to be built between the most demanding consumers for products in developed countries and the producers in Indian. Production factor conditions: Indian overly relies on basic factor advantages but has some high quality and fine art. The village enjoys relatively good access to deposits of clay and kaolin, which form the natural resource base for its ceramic products. It also has a low-cost but welltrained labor force of approximately 20,000 people in some 1,300 family companies. Families in Indian have centuries of history in passing down skills from generation to generation. Indian also transports materials and products by boat. Energy cost and availability comes from both liquid petroleum gas (LPG) as well as from coal-fired kilns (there are 180 LPG kilns in Indian). Coal, while cheaper than LPG, is a poor energy source from an environmental and health standpoint and there is a desire among the producers in Indian to upgrade to cleaner LPG kilns. Products fired in LPG kilns have fewer defects and better quality consistency. Indian shows emerging capabilities in some advanced factors. According to industry expert Dr. John Mooney, Indian has unique design and artisan skills. There is also a capacity to make a high-temperature red glaze that appears to be unique in the world. Many Indian producers, however, lack process standardization, which results in poor product consistency. It is recommended that the village develop quality control methods and build upon the existing advanced skill factors. Reliance on low cost is NOT a competitiveness strategy recommended for Indian. Producers who rely on low cost and under-cutting prices only compete against each other to keep their profits very small, in effect competing to be poor. Related and supporting industries: The cluster of related and supporting industries is present but needs strengthening. There are close linkages between the industry and the, which has a ceramics division that works on designs and glazes. The plaster used for molds is imported, which limits producers access to this key product and influence over its production and price. Protective packaging suppliers could improve domestic product presentation through more aesthetic packaging and reduce damage to exports through better quality packaging. Currently plastic bags are used for some domestic packaging, which doesnt protect the product or promote a good quality image. The quality of export packaging is marginal and should be improved to prevent loss through NSVKMS MBA College Visnagar 131
Strategy: Conscious or not, the Indian strategy seems to be to compete on the basis of low cost with a limited line of traditional products selling largely through intermediary buyers. The Indian company has many years of production experience but stakeholders confessed to being relatively new at thinking about markets and strategy. Therefore, products tend to be similar and there may be intense rivalry on the basis of limited product offerings. The lack of marketoriented strategies, while understandable for historical reasons, can now be addressed and result in higher sales values per unit. Improved strategy can improve the prosperity of the village over the medium term. There has been little development of strategies for innovation or product differentiation, although some firms show highly sophisticated design and artistic capabilities. A few firms are demonstrating the advantages of finding niche clients with specific needs and then providing products that provide additional margins. Many Indian products are not branded by origin and most companies have not developed trademarks, limiting the recognition of the Indian pottery tradition. A few companies have begun to experiment with the Internet to find markets and customers, but the majority of firms wait until buyers come to the village. Clients choose Indian rather than Indian choosing its clients. A positive strategic decision was the creation in 2001 (officially launched in November 2002) of the Indian Council of Ceramic Tiles & Sanitary ware. The association, at the time of writing, consists of 30 companies. An embryonic staff of three people has been hired. ICCTS has been invited to be a lead consultant to the association in providing strategic and catalytic assistance. Variability in quality because of a lack of process control technology may also be positioning the cluster at the low end of the market even though many of the products are of world-class quality for this niche market. Some innovators who are adopting new strategies, improving process technology, and creating new designs are already emerging, however, this process could be accelerated. Conclusions of Diamond Analysis: Indian needs to improve its knowledge of international consumers and markets so that firms in the local city can have a wider set of sales opportunities to build both volume as well as per-unit price. Closer linkages to sophisticated end-users will drive improvements in strategy and the upgrading of production factors. Strategy should focus on repositioning the industry from over-reliance on low-cost production to quality improvements, innovative designs, marketing and utilization of appropriate company branding. The industry development can improve competitiveness strategy by making better use of company trademarks and mark-oforigin branding for Indian products that meet certain quality standards. Acquisition of process control technology can help improve the consistency of quality. The further development of the cluster of related and supporting institutions can incorporate university R&D for upgrading kiln technology and product design. NSVKMS MBA College Visnagar 132
Analysis Of The Competitive Forces: Professor Michel porter of the Harvard business school has convincingly demonstrated. The state of competition in an industry is a composite of five competitive forces, which are as follows: 1) Competition among rivalry 2) Threats of new entrants 3) Threats of substitute products 4) Bargaining power of supplier 5) Bargaining power of buyer
Porters five force model
We have analyzed here the five forces of competition in context with ceramic tile industry. Analysis of the five forces of competition is as under relating to ceramic tile industry. Why competition entered Indian market? 1) 2) 3) 4) 5) Booming housing sector Picking up of commercial buildings Rise of real estate activity Requirements of creativity Conversion of mosaic tile to ceramic tile
Competition among rivals: In the ceramic tile industry it is been found that the rivalry is centered by the continuous new innovations brought about in the types of tiles. Rivalry among the competitors in the ceramic tiles industry is because of following reasons. Attributes of an industry that increase the threat of rivalry: 1) 2) 3) 4) 5) Large number of competitors Plethora of unorganized sector Productive capacity is adding up in increments Merger and acquisitions Strong distribution network
Number of competitors increases: In case of the ceramic tile industry wall tile share is 42%, floor tiles are 46% and that of newly entered vitrified & porcelain tiles are 13%. Share of the organized sector production is 56% and that of unorganized is 44%. Number of units for organized is just 25 while that of unorganized 200 approximately. Among the organized the top 3 of floor and wall tile producers are H R Johnson, malaria ceramics and SPL. H R Johnson has the market share of about 25.32%, kajaria ceramic is about 14.51% and SPL is about 12.31%. H R johnson is even winning the position as the global leader. Kajaria is the challenger brand and rest follow as the followers. H R Johnson (India) limited is the market leader in India with a market share of 30% in wall tiles, 20% in floor tiles and 25% in vitrified tile segments. Sun earth tiles have about 19 % market share in wall tiles and 11% in the floor tiles. In addition to the innovative products that H R Johnson introduced during the first half, they also planned to launch joint-free tiles under the brand name Johnson gres porcellanato with natural marble finish in sizes -2 feet *1 feet and 2feet * 2 feet, which can be used in wall as well as floor, such tiles are introduced for the first time in India. Several other NSVKMS MBA College Visnagar 134
innovative products like anti-slip bathroom tiles in size (8*3),kitchen tiles of size-4*4, large wall tiles of size 12*16. Recently in last news paper cutting it has been found that anti water repellent have been also introduced by the company. Marbonite, vitrified tiles brand has become no.1 in India within a short time of 1 year and company expects that the sales of marbonite to exceed Rs.1 bn by 2002.
Company exports have been to over 40 countries including Spain, Japan, Sweden, Singapore and New Zealand, these markets are fiercely quality conscious, competitive and extremely difficult to penetrate. In addition to these countries company has been exporting to the neighboring countries like Sri Lanka, Maldives, Mauritius, Seychelles, etc. Moreover exports orders of some countries like USA, UK are also executed by H R Johnson (India) limited in association with collaborator, Johnson ceramics international, UK. The product portfolio of kajaria consists of tiles of myriad shapes and sizes, which gives the consumer array of choices.
Mergers and acquisitions: The demand-supply situation is a cause of worry for the industry, on one hand, the demand is set to increase and on the other hand, industry is grappling with the over-capacity situation- a legacy continuing since the early nineties. That is getting corrected as the industry is passing through a consolidation phase. There will definitely be more mergers and an acquisition in the near future, e.g. the sun earth ceramics has acquired the savanna ceramics in February 2000. Sun earth recently acquired two ceramic tile companies, one in Spain and the other in Romania. Thus, it has become the first ceramic tiles company in the country to have an international presence. Plethora of unorganized sector: The unorganized group producing the ceramic tiles is about 44% in India. This group has strong regional effects due to number of market players. These players try to dump down the products of national players by providing the product at the cheaper rate.
Productivity expansion: It is been found that there has scaling up of productivity made up various national playing competitors as Kajaria ,H R Johnson, Murudeshwar ceramics and SPL .they have proposed for 20000,9000,and 50000-tonnes/day capacity.
Thus the competitive rivalry is high. Threat of New Entrants: A second force affecting industry attractiveness is the threat of new entrants. Net competitors add capacity to the industry and bring with them the need to gain market share, thereby making more competition more intense. New entrance: New entrants are firms that have either recently begun operation in an industry or that threaten to begin operations in an industry soon. Barriers to entry into an industry 2. Huge investment 3. Product differentiation 3. Distribution network 3. Government regulation of entry Huge investment: If the company wants to launch its ceramic tile company at national level then it requires the huge investment, so it is not easy for new companies to come in ceramic tile industry. So the entry is not so easy for new companies. High amount of capital is required to produce qualitative product. The cost of other infrastructure facilities is also to be considered by new entrants .so capital requirement is also one of the entry barriers. Moreover it is been found that the technology required for the production purpose is also very costly. Product differentiation: It is been seen that various leading companies have come up continuously with large innovations, which makes its space specific and constant. a. Murudeshwar is the pioneer in the vitrified section of the tiles, which was at a good position right from wall to floor tiles even before hand. b. H.R. Johnson is moving up with the anti-slip and anti-water repellent tiles section in its recent launches. c. NAVEEN of vitrified tiles has gained popularity in a short span of time. MCLs brand distinction of producing largest size floor tiles for the first time in the country. NSVKMS MBA College Visnagar 136
d. Bell granito revolutionized the Indias first fully flooring concept in India in the late nineties by introducing body homogeneous vitrified tiles. The tiles were a combination of classy designs of Italian marble and granite. e. For the SUN EARTH, SONARA and SAVANA brands enjoy strong brand equity. The former is placed at the upper end of the price segment, where the competition from unorganized sector and imports is much less. On the other hand, savanna is pitted at the lower end of the market segment. Sun earth has also been quietly introducing some value-added products in the market, which have been getting good acceptance. So it would be really a difficult task for the new entrant to put up a highly differentiated product.
ACCESS TO CHANNEL DISTRIBUTION: H R JOHNSON Indias largest tile manufacturer and has geographically diversified manufacturing plants located at 5 different parts of India. Company has widest distribution network of 800 dealers and 7000 sub-dealers and our own 20 warehouses-cum-branch offices spread across the products. KAJARIA CERAMIC having established a good established network, marketing expenses in the future will be lower. This coupled with expected buoyancy in the housing sector should result in kajaria posting a healthy growth in earnings during the next two years. SUN EARTH markets the sonara and savanna brands through a network encompassing nearly 500 dealers and distributors. It has joined the rank of select ceramic tile companies that possess a distributor /dealer presence in all the states of the country. This ensures that the companys products reach the point of demand easily. Having a widespread distribution network acts as a high entry barrier for a lot of other players. MCL has a strong presence in south India, which contributes more than 50 % of its revenues and plans to tap northern and western market through its wide network. MCL is now the only company in India, which has the largest number of company, owned and operated showrooms, displaying the entire range of products manufactured by MCL. Currently, it has 50 showrooms and 35 depots operating in different parts of the country. It plans to add around 25 new showrooms, aggregating to total 75 showrooms. MCL has total 18 showrooms and 12 depots in western and northern India. Now taking about these big giants in the market having such a solid marled distribution channel it will be difficult for any entrant to get in the market. Government regulation of entry: NSVKMS MBA College Visnagar 137
The government on the countries like china, Malaysia and Indonesia has laid antidumping duty in order to protect the local manufacturers of the country. Thus the threats of the new entrants are moderate.
Threat of substitute products: Here the substitute products of the ceramic tiles are as follows: Marble, granite, terrazzo tile, mosaic tiles, agglomerated stones, concrete paving stones, Kota stones, and these substitutes can ultimately replace an industrys products and services. Granite and marble still preferred because they are available in good big sizes to cover up good areas in a single hard covering. Moreover in case of the strength and prestigious looks it has been found that granite and marble are comparatively above ceramic tiles, marble and granite are naturally available stones therefore its properties remain in consistency. But there are chances that shades, strengths etc may vary. The price for 1 sq.ft of ceramic tile that too vitrified tiles is greater than marble or good quality granite.
Bargaining Power Of Buyers: Any industrys customers constantly look for reduced prices, improved product quality and added services and thus can affect competition within an industry. Buyers play individual suppliers against one another in their efforts to obtain these and other concessions this is certain the case with some large retailers in their dealings with many of their suppliers. There are some reasons. a. The housing sector is witnessing a strong rise up hence it can be said that the buyers of the ceramic tiles, the construction companies have been playing a major role. Not only house holders but also even the constructors even prefer it because of the durability, longevity, creativity and lesser transportation costs. Therefore it is been seen that these companies can put up a reasonable rates compared to existing rates in the market. b. Urbanization has also been proved to be awareness factor making people know about the concept of ceramic tiles. The number of companies playing regionally and nationally can prove to be a boon to the buyers fetching a good rate for a particular class of tiles. c. Education level has created awareness among the people to use and know about various types of ceramic tiles. This is due to the promotional activities. NSVKMS MBA College Visnagar 138
Conclusion: Analyzing the above five forces it can be said, the competition of rivals is very high i.e. the number of companies working in the production of the tiles. The threat of new entrants is low because of high distribution networks, huge investments and high product differentiation made by the giants continuously. The threat of substitutes is also high because it is found that still there are major groups following status, prestige and even groups in rural less aware about the product. The threat of suppliers is negligible because the raw material needed is very easily available and in abundance. The threat from the buyers is also high because of switching over nature of the consumers, urbanization, number of companies in the market and education.
OT Analysis For The Indian Ceramic Industry: Opportunities: Introduction of new entrants: A major change took place in the tile industry was the introduction of the vitrified tiles and porcelain tiles. The new entrant products are the major sellers. These categories of the products account for the 13% of the organized sales in the industry. These new products and the conventional tiles have it together made the organized industry grow to a formidable rest 1656 crore industry. This coupled with a spate of expansions by many players makes the industry lock a very promising in the future. The new category of porcelain and vitrified tiles will gradually take away the market from conventional ceramic tiles, because of their porosity, good set up after application and good durability. Job opportunities: As the number of ceramic tile producing units are increasing to meet demand it requires man power which would create job opportunities offered are manifold say 300 direct jobs per million sqm and 3000 indirect jobs per million sqm with greater incentives. Abundance of material and labor: Indigenous position because of the abundance of raw material available, skilled labor, this increase the availability of the essential factors required for the production of the tiles thereby making it more user friendly. It makes no gap for the demand and supply. Specific feature: The weight of the ceramic tiles is less in comparison to other tiles like mosaic which lessens its transportation costs, Moreover due to new technology being used for their production lesser chances of their to be broken up shade differences, creativity and durability have increased which would lead to increase in its demand. Demand for residential property: Economic revival and job opportunities in software and BPO segments, is driving demand for residential property as IT segment and BPO operations are throwing lot of job NSVKMS MBA College Visnagar 140
opportunities .people are shifting their base in tech cities in order to cash on the better job opportunities and pay scale. Therefore ceramic tiles have a good scope for their usage depending on the segment and creativity that is required. Tax benefits: Tax benefits have been a role in popularizing home loans. Interest repaid on home loan up to Rs. 1.5 lack per year qualifies, as deduction while capital repayment up to Rs. 20000 is eligible for rebate under section 88. This brings booming the housing sector thereby having strong impact on ceramic tile industry.
Lower interest rates leading to higher affordability: The Indian housing loan market to have witnessed a distinct shift in the past couple of the year backed by more affordable loans available at better terms. Fixed interest have fallen from 16% in 1997-98 to 11.4% in 2002-03 this declaim in interest rate is expected to declaim further. The floating rate for short term maturity housing loan is in the range of 7.75-9.5%. Free home insurance, lower rate for purchase of consumer durables, household goods, personal computer, car two wheelers for the existing home loan customer. In last three years the interest rate for housing loan have reduced by 6% and have lower to 7.25 at present. The growth have Indian ceramic tiles industry is impeded by certain polices/procedural hurdles like anomaly of inverted duty structure and low abatement or, MRP. Environmental: Environmentally scores well over the other counterparts. Its practically pollution free manufacturing this resulted in a sort of the boom in the industry. Excise duty: A cut in the excise duty has raised its growth over 12 % year on year making it comparatively in a good position compared to the other industries in the market.
Threats: Gas supply: Erratic supply for gas in the kiln or even spiraling cost of the fuel that forces Indian industry out of the world market. Manufacturing unit size: we lack to compete internationally because of plant capacity whereby affecting the special sizes and designs not being produced. Unorganized sector: NSVKMS MBA College Visnagar 141
Plethora of the unorganized sector accounted to be 44% which stood at 2.58 million tones during 2001-2002. Dumping threats: Dumping in markets of cheaply sold vitrified tiles by countries like Indonesia, Malaysia and others. Various government regulations: Threat of WTO, indo-srilankan agreement and Bangkok agreement.
Reduction of import duty: Imports duty being reduced by government domestic tiles will experience a complete shakeout in the vitrified tiles segment during 2004-2005. Imported goods: The Indian tile industry is facing threat from china and UAE. The stiff competition has lead to low realizations as the imported products are offered at much cheaper rates as compared to prices prevailing in India. In order to match with the prices of imported tile, the Indian manufacturers are facing pricing pressures and MCI is no exception to it. In order to prevent imports, the finance ministry has imposed a definitive anti-dumping duty on all imports of porcelain and vitrified tiles (other than industrial vitrified) from the United Arab Emirates (UAE) and china. Based on the recommendation of the designated authority in the commerce ministry, the revenue department has now imposed a definitive anti-dumping duty of $ 8.28 per sqm on all imports of vitrified or porcelain tiles from china and UAE, the products still make their way in Indian markets through south Asia association of regional cooperation (search) countries.
21. The Boston consulting group approach: The growth share matrix is divided in to four cells each indicating a different type of business: Table 21.1 Relative Market Growth
Star Ceramic tiles Ltd. Cash cow Relative Market Share
Question mark Dog
1. 2. 3. 4.
question mark star cash cow dog
Among the four we can place the business in star cell because the market growth is high. The companies related to the ceramic tiles are making good profit through there is a variation in the sales. It is also found that the exports made by the country to various other countries are quite high while relating to the imports they are quite less. There is constant fight between the competitors for their continuous innovations being made. There has been good distribution access made through out the country by the organized sector players making the product reachable to varied segments. But the unorganized sector is having 44% of the share in the countrys market, which affects the organized share. The vitrified and porcelain types of tiles which are new entrants to the segment of the ceramic tiles are also forming a good market share of 13 % replacing granite and marble the substitutes.
Critical success factors: The key factors for success for the ceramics industry are similar to that for glass, as they operate in similar markets and address similar consumer segments. Both use energy intensive manufacturing processes. Hence the key success factors for the ceramics industry will include:
Efficient manufacturing processes Technology especially in growing areas like porcelain and vitrified tiles Supply chain management and distribution Branding Having a strong brand is more critical for ceramic tiles and sanitaryware, as these sectors address individual consumers. Players like H. & R. Johnson, EID Parry and Hindustan Sanitary ware invest substantially in advertising and brand building. Their efforts have been successful in creating a felt need for high-end ceramic products in houses, especially in urban areas. Going forward, the acceptance of technically superior, high-end products in these segments is expected to be better than in the past. However, as the market is getting increasingly competitive, players will still need to focus on creating a differentiated position in the market.
Conclusion
There are at present 14 units in the organised sector with an installed capacity of 12 lakh MT. It accounts for about 2.5% of world ceramic tile production. The Ceramic tiles industry has grown by about 11% per annum during the last three years. In India the per capita ceramic tile consumption is 0.09 sq. m. per annum as compared to 1.2 sq. m. per annum in China and 5 to 6 sq. m. per annum in European countries. Its demand is expected to increase with the growth in the housing sector. Indian tiles are competitive in the international market. These are exported to East and West Asian countries. The export was about Rs.143 Crore during 2001-02. Sanitaryware also is manufactured both in the large and small sector with variance in type, range, quality and standard. This industry has been growing by about 5% per annum during the last 2 years. There is significant export potential for sanitaryware. These are presently exported to East and West Asia, Africa, Europe and Canada. The export was about Rs.850 million during 2001-02. Potteryware signifying crockery and tableware are produced both in the large scale and the small scale sector. Units are spread all over the country. There are 16 units in the organised sector with a total installed capacity of 43,000 tonnes per annum. Bone china crockeryware items are imported from Bangladesh and Sri Lanka in view of the availability of cheap natural gas and better availability of raw materials there. The export of potteryware during 2001-02 was of the order of Rs.430 million.
1. It is very clear from the through out study of the ceramic tile industry that the industry is highly capital intensive because of the technology and infrastructure, therefore it requires a good economical and sound technological knowledge for this purpose to set up a plant or manufacturing the unit of ceramic tiles. 2. Since the housing and commercial sectors are booming and witnessing a strong pushup therefore the industry has good prospects for the future years. The new entrants have also pushed up the market share through vitrified and porcelain tiles. 3. There is urbanization and raised education level which will also create awareness among the mass for the usage of the ceramic tiles instead of its substitutes which also have a positive impact on the industry. 4. The WTO, various agreement and duties laid by the government will also prove to be a boon for the domestic and major players in the market. It will also be affecting positively the registered and non registered producers in the market. 5. The technology, labor as well as the abundance of the raw materials is the beneficent factors for the development of a ceramic tiles unit, which are well versed and furnished in our country. NSVKMS MBA College Visnagar 146
6. The concept of efficient bidding and procurement if brought to India will also help in major destination of exports be increased and provide a good profit margin for the producers. But it still requires enhancement of technology at the stage of the dealers, sub-dealers, showrooms and even and local retail outlets. The infrastructure of our manufacturing also needs to be improved through expansion. 7. A strong and widespread of the distribution network is also adding to success point for the ceramic tiles industry because it makes it reach gig her and more availability. It wills thereby promoter the industry to get good sales growth, increasing the profit.

Ceramic Tiles Industry Research Project

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Management Research Project On Ceramic Tiles Industry

1. Product market description

Management Research Project On Ceramic Tiles Industry

Constituents of Ceramic tiles:

Clay Sand 57% Feldspar Other materials

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INDUSTRY SEGMENT Structural clay products White wares Refractoriness

Cements Advanced ceramics Structural Electrical

Chemical and environmental Filters, membranes, catalysts, and catalyst supports

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Structure and Properties of Industries:

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Various types of tiles and their characteristics:

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2.Tile manufacturing process

Ceramic tiles manufacturing process:

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Ceramic tiles raw material:

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Annexure I - List Of Materials Classified As Raw Materials

material Raw improve Used to the material improve the

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Raw Materials Listing in Ceramic tiles:

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3. Substitutes Of The Ceramic Tiles

A) agglomerated stones B) terrazzo tiles C) concrete paving stones

NATURAL FLOOR COVERING Natural stone (e.g. marble, granite)

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4. History of the ceramic tiles

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Ceramic tiles industry in india:

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5. PRODUCT LIFE CYCLE:

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6. Application of the ceramic tiles:

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7. Major Players In The Ceramic Industry In India