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Future of cement distribution is exciting and challenging

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Syaam Prakash V, Vice President – Marketing, NCL Industries, speaks about their preferred distribution channels and the impact that technology is likely to have on the processes in the near future.

How many channels of distribution do you prefer to have for your product and how do you choose them?
Our channels for distribution of cement can be broadly classified into six types, selection of which is based on the channel’s reach, efficiency and cost optimisation and is finally driven by
consumer’s preference.

Which is your most preferred channel of distribution and why?
Our most preferred channel of distribution is through dealer to consumer. This channel has been our mainstay for several years and constitutes 80 per cent of our dealer network of over 2200. It gives us immense reach into rural Andhra Pradesh and Telangana. Now the company is focused to develop channel wholesaler – retailer to consumer. This is predominantly in urban markets where the company is focused to increase its presence. 75 per cent of our business is from channel sales, hence, we continue to strengthen it by adding close to 250 dealers a year across south India.

How do you select your distributors? Tell us about the parameters and selection process.
The following are the parameters to evaluate distributors selection:
» Retail network size, store locations and retail store space
» Synergy to existing network, niche clientele base
» Financial strength and potential to grow. Scope to add other products of NCL (cement article board, NCL doors etc) and group company products (AAC blocks, wall putty, paints,
UPVC etc)
» Current cement dealerships and their positioning vis-à-vis Nagarjuna Cement.

What are the major challenges in the line of distribution of cement?
The major challenges that we have faced in our distribution channels are:
» Timely, cost effective and seamless reach to consumers
» Continued channel partners loyalty
» Penetration, reach and depth in retail space
» Efficient last mile connectivity and service to consumers

What are the software and other IT solutions used to understand the cement distribution?
Currently we are not using any software specifically for cement distribution. We are evaluating
several options.

How is the acceptance of online sales of cement?
India has the third largest online shopper base of 140 million subscribers contributing to US $ 50 billion in turnover 2020. The segment is growing 35 per cent annually and the Indian digital economy is estimated at US $537 billion. However, the major share of which is from groceries, educational technology and personal care, beauty and wellness (PCB&W) segment etc. The online sales of cement is growing gradually in India as most of the customers still prefer to shop at brick and mortar stores.

Who are the major buyers of cement online?
Thus far, major buyers of cement online in India are Individual House Builders (IHB) and institutional buyers.
As we can see, bulk of cement is bought by central and state governments for low-cost housing, infrastructure etc. Urban housing (builders) and industrial buyers are yet to take up online buying in a big way and the space is still evolving as the same involves credit and contract buying.
Hence, purchase of cement online will increase in the years to come as penetration of smartphones and 5G network improves in rural markets.

How do you foresee the future of cement distribution?
Cement distribution has been evolving over the last few decades. We are graduating from being commodity (cement) sales to product marketing in the cement space. Further, due to various new applications (RMC, cement sheets, cement particle boards, AAC blocks, prefabricated structures, 3D printing, white top highway roads etc.) cement is moving into bulk sales (naked cement).
There are a lot of green initiatives in cement production and applications. New products are being developed and promoted for the benefit of individual as well as industrial customers.
India is second largest producer of cement in the world with 550 MMT per annum installed capacity and consumption is estimated to grow at 9 per cent CAGR in next few years (current per capita cement consumption is 250 kg against world average of 550 kg) hence the future of cement distribution is exciting and challenging.

Concrete

Star Cement launches ‘Star Smart Building Solutions’

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Star Cement has launched ‘Star Smart Building Solutions,’ a new initiative aimed at promoting sustainable construction practices, as per a recent news report. This venture introduces a range of eco-friendly products, including tile adhesives, tile cleaners and grouts, designed to enhance durability and reduce environmental impact. The company plans to expand this portfolio with additional value-added products in the near future. By focusing on sustainable materials and innovative building solutions, Star Cement aims to contribute to environmentally responsible construction and meet the evolving needs of modern infrastructure development.

Image source:https://www.starcement.co.in/

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Concrete

Nuvoco Vistas reports record quarterly EBITDA

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Nuvoco Vistas reported its highest-ever quarterly consolidated EBITDA of Rs.556 crore in Q4 FY25, with annual EBITDA at Rs.1,391 crore. Cement sales reached 19.4 MMT in FY25, with Q4 contributing 5.7 MMT. Revenue rose 4 per cent YoY to Rs.3,042 crore in Q4. Net debt reduced by Rs.390 crore to Rs.3,640 crore. The company received NCLT approval for acquiring Vadraj Cement, targeting 31 MMTPA capacity by FY27. Key marketing initiatives, expanding RMX and MBM businesses, and a focus on sustainability (457 kg CO2/tonne) drove performance. Nuvoco remains focused on premiumisation, operational efficiency, and market expansion.

Image source:nuvoco.com

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Concrete

UltraTech Cement increases capacity by 1.4Mt/yr

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UltraTech Cement has expanded its production capacity by 1.4 million tonnes per annum (Mt/yr) through a combination of debottlenecking efforts and operational efficiency upgrades across several of its plants. The enhancements include an addition of 0.6Mt/yr in grinding capacity at the Nagpur facility in Maharashtra and a combined 0.8Mt/yr at the Panipat and Jhajjar units in Haryana. With these upgrades, the company’s total domestic grey cement capacity has risen to 184.8Mt/yr, while its global capacity now stands at 190.2Mt/yr.

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