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Table of Contents

1.0

Company Background ..........................................Error! Bookmark not defined.

1.1

Company Logo...................................................Error! Bookmark not defined.

1.2

Company Profile ................................................................................................. 1

1.3

Vision and Mission ............................................Error! Bookmark not defined.

1.4

Core Business .....................................................Error! Bookmark not defined.

1.5

Board of Director ............................................................................................... 4

1.6

Share Capital ...................................................................................................... 4

2.0

General Environment Analysis ............................................................................. 5

2.1

Political Factors .................................................................................................. 5

2.2

Economic Factors ............................................................................................... 5

2.3

Social Factors ...................................................................................................... 6

2.4

Technological Factors ........................................................................................ 6

2.5

Environmental Factors ...................................................................................... 8

2.6

Legal Factors ...................................................................................................... 8

3.0

Task Environment Analysis ................................................................................ 10

3.1

Porter Five Forces Model Analysis ..................Error! Bookmark not defined.

3.1.1

Rivalry among Competing Firms .............Error! Bookmark not defined.

3.1.2

Threats of Substitute Products .................Error! Bookmark not defined.

3.1.3

Threats of New Entrants ...........................Error! Bookmark not defined.

3.1.4

Bargaining Power of Buyer .......................Error! Bookmark not defined.

3.1.5

Bargaining Power of Suppliers .................Error! Bookmark not defined.

4.0

S.W.O.T Analysis ..................................................Error! Bookmark not defined.

5.0

T.O.W.S Matrix.................................................................................................... 16

6.0

Ratio Analysis ....................................................................................................... 18

7.0

Strategic Decision ................................................................................................. 23

8.0

Best Strategies Recommendation ....................................................................... 25

9.0

References ............................................................................................................. 26

1.0

Company background

1.1

Company Logo

1.2

Company Profile

Yi-Lai Industry Berhad is a Malaysia-based tile production company founded in 1990.


Yi-Lai Industry Berhad was listed on Bursa Malaysia in year 2002 (The holding company
of Yi-Lai Industry Berhad) and over the years it has grown to become one of the most
established companies in the Asia Pacific region.
In November 1991, Yi-Lai Industry Berhad was registered as the proprietor of the
Alpha Tiles trademark and began the production of a single Italian tile line in it factory
that located at Kulai, Johor.
To stay ahead in the tile production industry, Alpha Tiles has adopted forward
thinkingstrategies and policies based on Italian business models. Italy is the global leader
in tileexpertise and production technology, and Alpha has incorporated both into its
ownbusiness. Alpha Tiles began production of its first Italian tile series in November
1991, with the products well received and quickly adopted by a fast-changing Malaysia
construction industry demanding novel, practical and adaptable tiling solutions.
Today, the company continues to command a high percentage of the Malaysia
tile market. As of 2006 the factory had about 700 employees and currently has seven
production lines with production capacity of about 13,000,000m2 of ceramic,
homogeneous and porcelain tiles annually.

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Yi-Lai Industry Berhad have also been successfully certified to MS ISO


9001:2008 Quality ManagementSystem and MS ISO 13006:2003 for Product Quality
Certification.
1.3

Vision and Mission


1.3.1

Vision
To be the leading supplier of quality ceramic and porcelain tiles, not only
in Malaysia but throughout Asia Pacific and the rest of the world.

1.3.2

Mission

Stylish Living.

These are the things we want our surroundings to reflect.

These are the things we want our lives to reflect.

It all starts with a dream.

WHO better understands this than ALPHA?


Back in 1991, one man had a vision which is One man. One factory. One
goal. that provide quality products to meet his customers design needs.
With few decades of experience, ALPHA understands that people have
varying interests, tastes and product needs. Trends are always evolving.
And through the years, ALPHA products offer you all the need to
transform the creative ideas into reality.

Fulfilling the dream.


It all starts with a dream, the dream of the perfect home, the perfect lift.
ALPHA understands your dream. Today our company runs by dedicated
staffs who continue the dream, producing and distributing high quality
products that exceed our customers needs.

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Whats your dream? Let ALPHA makes it a reality.

1.4

Core Business

Yi-Lai Berhad is a Malaysia-based investment holding company. The business activities


of the Group are mainly relating to the manufacture and sale of ceramic and
homogeneous tiles. The Company operates in Malaysia. The company offers digital print,
wall, floor, alpha porcelain, and homogenous/porcelain tiles. It is also involved in the
trading and distribution of tiles. The Company's subsidiaries include Yi-Lai Industry
Berhad, which is engaged in the manufacturing and sale of ceramic and homogeneous
tiles; Yi-Lai Marketing Sdn. Bhd., which is engaged in the trading and distribution of
tiles, and Yi-Lai Trading Pte.Ltd., which is also engaged in the trading and distribution of
tiles. Its products are exported to Australia, Brunei, Belgium, India, Japan, Pakistan, New
Zealand, Thailand, Taiwan, and others. The company was incorporated in 2000 and is
headquartered

in

Kulai

jaya,

Malaysia.

Figure 1 YI LAI is capable of producing multi-effect homogeneous tiles that bear


finishes equivalent to surfaces of natural stones.

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1.5

Board of Director

In general, every incorporated company would have its own board of directors. Board of
directors normally make up by a group of individuals elected to act or decide on behalf of
shareholders to look after their interests.
Name

Board of Director

EncikZabidi bin MdZain

Independent Non-Executive Chairman

Mr Lim OonKok

Managing Director

Mr Hsieh Yu-Tien

Executive Director

Ms Lim Yun-Li

Non-Independent Non-Executive Director

MrOngKhengSwee

Independent Non-Executive Director

MrOng Chin Lin

Independent Non-Executive Director

MrSooChoonSiong

Executive Director

1.6

Share capital

Authorized Share Capital

RM500,000,000

Issued and Paid-up Capital

RM80,000,000 divided into 160,000,000 shares of


RM0.50 each

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2.0

General Environment Analysis

2.1

Political Factors

Malaysia is a politically stable country. The government has been headed by the UMNO
since independence, while the ruling coalition, the Barisan Nasional (BN), has won every
general election. The ruling Barisan National party has been in power over 25 years. (The
fact provided the country with a high degree of stability, which is important factor for
businesses investing in the country)
Corruption does exist in the country. The may be a barrier for foreign country to
invest in Malaysia. But the Government has also pledged to implement the appropriate
policies and provide its support for the creation of a conductive environment for business
and investment.
Next, foreign exchange rates will have impact on the cost of materials. In other
words, unfavorable foreign exchange movement against Ringgit Malaysia (RM) would
have a negative impact on the profitability of Yi-Lai Industry Berhad.
2.2

Economic Factors

Economic factors are referring to factor the outside economic issues that can play a role
in a company's success. For example, economic growth, exchange, inflation and interest
rates, the current business cycle of the country where the company is located in and
unemployment policies.
The ceramic and homogenous tile manufacturer acknowledged that the operating
is becoming increasingly challenging with the hike in electricity and natural gas tariffs,
and intense competition amongst local tile manufacturers and from imported tiles
Due to uncertainties surrounding the recovery of the global economy, particularly
the economic growth in China, which has led to softening of international tile prices and
volatile raw material prices, the operating environment for the tileindustry, is expected to
remain challenging On the domestic front, tilesdemand remain to grow for the medium-

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range ceramic tiles in Iskandar Malaysia with affordable housing projects by state-owned
and the government-linked companies.
2.3

Social Factors

Social factors are referring to the demographic and cultural aspects that can help
determine whether a business can compete in the current market. These factors help
businesses examine consumer needs and what pushes them to make purchases. For
example, country demographics, population growth rates, age distribution, attitudes
toward work, lifestyle changes, education and environmental and health consciousness.
Annually, the Group has been making contributions financially to various
charitable organizations with the hope of making a positive difference to the lives of the
less fortunate. The Group also donated ceramic tiles to schools, orphanage homes, and
religious places in order to fulfill their needs for expansion or improvement of their
premises. In year 2013, the Group sponsored ceramic tiles to a secondary school for their
assembly hall with floor area of about 10,000 sqft, which was destroyed by fire.
The Group also acknowledges that employees are its best assets and will continue
to invest in staff development programmed so as to equip and develop our work force
with both technical and soft skills. In addition, the Group also presented achievement
awards to our employees' children who excelled in the government examinations. Sports
and other activities were carried out with the full support and commitment of our
employees, through the Group's sports club, with a view of providing a healthy lifestyle
for our employees and their families.
2.4

Technological Factors

Technological factors are referring to the issues that impact how an organization brings
its product or service to the marketplace. Depending on the technology available, it can
make it easier or harder to enter the industry and increase production level. For example,
new technology advancements, government spending on technology research, the life
cycle of current technology, the role of the Internet and any changes to it play and the
impact of potential information technology changes.
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Malaysia technology has improved over time, many researches and development
had made in order to improve the current technology that the country owed. The
advanced technology is helps in goods manufacturer. The productivity is increasing due
to the production are all based on machine. In economic theories, an increasing in
productivity will lead to a lower cost of goods because the cost of bulk purchase of raw
material becomes cheaper. Besides that, the machine that using in production is utilize
hence the cost that used in labor recruitment is decrease because everything is done by
using machines. In the long run, it decreases the cost of production and increase the profit
of the company.
Alpha Tiles searched for specialized tile production technologies. Alpha Tiles was
the first in Malaysia to offer Slate Effect Homogenous Tiles, and today remains one of
the few manufacturers of these beautiful and strong tiles in Malaysia. Alpha Tiles are also
found in many important commercial structures, including:

Penangs tallest building, the Komtar Tower

The plush Rockman Regency Hotel in Kuala Lumpur and

The Macro Hypermarket in Ipoh .


The Government of Malaysia has chosen Alpha Tiles for several key public

facilities, such as:

The new Sungai Buloh Hospital in Selangor

KotaBahru General Hospital in Kelantan

The Malaysian Islamic University-College in Nilai.


Besides that a new method of printing using digital techniques in which data and

image are printed directly from a computer onto tile. This technology allows them to
create an unlimited number of high-quality patterns and decorations, with fewer materials,
less waste and less development and production time than conventional processes.

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2.5

Environmental Factors

Environmental Factors are referring to all those that influence or are determined by the
surrounding environment. For example, climate, weather, geographical location, global
changes in climate, environmental offsets etc.
In the course of conducting its business operations, the Yi-Lai Industry Berhad is
committed to identifying, managing and minimizing the environmental impact of their
business activities. Yi-Lai Industry Berhad works closely with their environmental
management consultants to help them manage the impacts and ensure that they comply
with all relevant environmental legislations.
Group subscribes to the safety, health and environmental regulations with a
systematic approach reinforced by constant training and monitoring to ensure the safety
and well-being of the company employees.
2.6

Legal Factors

Legal factors are referring to certain laws that affect the business environment in a certain
country while there are certain policies that companies maintain for themselves. Legal
analysis takes into account both of these angles and then charts out the strategies in light
of these legislations. For example, consumer laws, safety standards, labor laws etc.
In accordance with the requirements of the Companies Act, 1965 in Malaysia, YiLai Industry Berhad report the following:
a) In our opinion, the accounting and other records and the registers required by the
Act to be kept by the Company and its subsidiary companies of which we have
acted as auditors have been properly kept in accordance with the provisions of the
Act;
b) We have considered the accounts and the auditors reports of the subsidiary
companies of which we have not acted as auditors, as indicated in Note 46 to the
financial statements;
c) We are satisfied that the accounts of the subsidiary companies that have been
consolidated with the financial statements of the Company are in form and
8|Page

content appropriate and proper for the purposes of the preparation of the financial
statements of the Group and we have received satisfactory information and
explanations as required by us for those purposes; and
d) The audit reports on the accounts of the subsidiaries did not contain any
qualification or any adverse comment made under Section 174(3) of the Act.

9|Page

3.0

Task Environment

3.1

Porters Five-Forces Model Analysis

Porters five forces analysis consists of five forces, which are threats of new entrants,
rivalry among competing firms, threats of substitute product and services, bargaining
power of customers, bargaining power of suppliers and relative power of shareholders.
3.1.1

Rivalry among competing firms


Rivalry refers to the degree to which firms respond to competitive moves
of the other firms in the industry. One firm only can be success compete
with others competing firms through pursue a competitive advantage
strategies. Competitive rivalry is likely to be based on dimensions such as
price, quality, and innovation.
Moreover, technological advances also protect companies from
competition. Companies that are successful with introducing new
technology are able to charge higher prices and achieve higher profits.
Therefore, rivalry within the industry is relatively low due to the Alpha
Tiles have the specialized tile production technologies which was the first
in Malaysia to offer Slate Effect Homogenous Tiles, and today remains
one of the few manufacturers of these beautiful and strong tiles in
Malaysia.
With that said, there are only a handful of competitors within the
ceramics industry. Yi-Lai Industry Berhad ceramics virtually faces no
completion in the local market and some competition from countries such
as China and Thailand, due to cheaper sources of labour, raw materials
and imports, sacrificing high quality.
Furthermore, the Yi-Lai Industry Berhad is known for having
strong strategies to remain competitive such as setting international
competitive standards and joint ventures with other companies in order to
utilize technological advances to create better line of ceramic goods.

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3.1.2

Threat of substitute products


A substitute product is a product that appears to be different but can
satisfy the same need as another product. The existence of products
outside of the realm of the common product boundaries increases the
propensity of customers to switch to alternatives.
The ceramic industry faces intense competition with low priced
goods such as tiles, sanitary and table ware that are majorly produced and
imported from China due to lower costs. In addition, the industry faces
completion from substitute products offered by companies in other
industries.
Like Yi-Lai Industry Berhad, other companies within the ceramic
and tiles industry are facing competition from manufacturers of substitute
products, thereby decreasing annual profits. Consumers often purchase
substitutes of ceramic products due to the convenience in terms of
availability and the attractiveness of lower prices. These substitutes
include several variations of tiles, crockery and wares such as melamine,
steel, glass, aluminium, stones such as marble, wood, and most commonly,
plastic wares.
Furthermore, imports of such substitutes have rapidly increased in
the past decade to a soaring fourfold. Manufacturers of these goods have
expanded their operations and capacities due to this to keep up with fierce
competition and exportation, thereby introducing more product lines to
attract a broader range of consumers.

3.1.3

Threat of new entrants


Profitable markets that yield high returns will attract new firms. This will
results in new entrants, which eventually will decrease profitability for all
the firms in the industry.

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Threat of new entrants to Yi-Lai Industry Berhad is relatively high.


This is because, Yi-Lai Industry Berhad has the advantage of not having
local competitors, but the ceramic and tiles industry has large amounts of
fixed costs involved, therefore the industry is capital intensive, making it
an entry barrier that limits potential threats of new entrants. In addition,
the need of automation and large investment in technological advances
pose as further entry barriers.
There has been significant growth in the demand for ceramic
products over the years and countries such as Bangladesh that enjoy cheap
labour, ease of access to raw materials needed coupled with duty free
exports to countries in Europe due to lack of quota restriction from a
generalised system of preference, increasing the gap between demand and
supply, it poses a threat of entry to the international ceramic market.
Imports of ceramic products coming from countries such as China
also pose a threat of new entry due to low import costs as they have
manufacturing plants of their own that produce large quantities of ceramic
goods, sacrificing quality.
3.1.4

Bargaining power of buyers


Bargaining power of buyer for Yi-Lai Industry Berhad which means the
ability of customers to influence the price and terms of purchase is near to
moderate. This is because, the present scenario of buyers demand is
changing relatively big size tiles are now in fashion as customers are
making now their home look aesthetics and giving it luxurious and the per
capita consumption of ceramic tile in Malaysia is low.
Moreover, demand for ceramic tiles is primarily led by an increase
in construction activities globally. Demand for construction in housing as
well as commercial sectors is rising due to growing economies,
urbanization, higher per capita income and spending, population
expansion and other such factors that are increasingly being witnessed in

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emerging economies. Additionally, usage of ceramic tiles fulfills the


demand for better aesthetics, structural reliability and sustainability
without a significant increase in prices. This has led to construction of a
higher number of buildings with usage of ceramic tiles in walls and floors.
These factors have collectively boosted the overall demand for ceramic
tiles.
3.1.5

Bargaining power of suppliers


The other relative power for Yi-Lai Industry Berhad is the suppliers.
Suppliers can affect an industry through their ability to raise prices or
reduce the quality of purchased goods and services.
As with other high quality ceramic and tiles competitors, Yi-Lai
Industry Berhad needs to import high quality raw materials for producing
quality ceramic and porcelain tiles. The raw materials such as potash
feldspar, soda feldspar and clay from countries such as Thailand, Malaysia,
Indonesia and India, glazes and fritz from European countries such as
Spain. Furthermore, other imported high quality materials include vitrified
high alumina porcelain from mines of Germany and UK which are of the
highest quality. Therefore the raw materials alone account for most of the
total production, apart from manufacture and technology. With that said, it
is evident that the base of suppliers within the ceramic industry is big
enough to weaken the bargaining power of suppliers.

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4.0

S.W.O.T Analysis

SWOT analysis is a structured planning method used to evaluate the Strengths,


Weaknesses, Opportunities, and Threats involved in a project or in a business venture. A
SWOT analysis can be carried out for a product, place, industry or person. It involves
specifying the objective of the business venture or project and identifying the internal and
external factors that are favorable and unfavorable to achieving that objective. Table
below shows SWOT analysis of Yi-Lai Industry Berhad;
Strength

Weakness

Established a strong trusted brand

High material cost

in tile industry.

Deep dependency on the local

experienced

market and little international

Specialized Tile production

experience

technology

Dependence on foreign suppliers

Efficient management, specialist

in the supply of parts, raw

and educated focus

materials and equipment

High quality of the product

Opportunity

High demand in the country for

competitive market

Weak international competitive.

Treat

tile and changing the culture of

Constantly changing demand


interest of consumers

society toward consumerism

Adapt strategic to consumer needs

Access to new markets.

Importing products from China

High inflation rate might raise


operating cost significantly

Technology advanced

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rising cost of raw materials

Global trend towards improvement

demand to grow for the mediumrange ceramic tiles in Iskandar


Malaysia with affordable housing
projects by state-owned

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of the overall products quality.

5.0

T.O.W.S Matrix

TOWS matrix is a commonly used strategic planning matching tool that provides
structure or clarifies strategic analysis. This technique guide complex decision making by
effectively removes subjectivity and emotion from the decision process, and help in
generate of several options or strategies for Yi-Lai Industry Berhad.
Strength
S1. Established a strong trusted
brand in tile industry.

Weakness
W1. High material cost
W2. Deep dependency on the

S2. experienced

local market and little

S3. Specialized Tile production

international experience

technology
S4. Efficient management,
specialist and educated focus
S5. High quality of the product

W3. Dependence on foreign


suppliers in the supply of
parts, raw materials and
equipment
W4. competitive market
W5. Weak international
competitive.

Opportunity
O1. High demand in the

Market Development
SO1. Introducing the brand

Product Development
WO1. Provide distinctive and

country for tile and

company in neighboring

unique

changing the culture of

countries and provide diverse

products to dominate certain

society toward

and high quality products

sectors and markets with high

consumerism

according to their cultural

profitability

O2. Adapt strategic to


consumer needs

characteristics(S5,O3)
SO1. Using experience company

Market Development
WO2. Institutionalize a culture of

O3. Access to new markets.

and information management

customer orientation and

O4. Technology advanced

systems to improve

teamworkto succeed in

O5. demand to grow for the

efficiency, quality and variety

domestic and foreign

of products to compete in

markets

medium-range ceramic
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tiles in Iskandar
Malaysia with
affordable housing

markets abroad (S4, O2)


Product Development
SO2. Use of specialized and skilled

projects by state-owned

personnel to innovation in

and the government-

manufacturing and marketing

linked companies..

products. (S1,S2,S3,01,O5)

Treat

Market Penetration

T1. Constantly changing

ST1. Support innovation in order

Strategic Alliance
WT1. Collaboration with suppliers

demand interest of

to response identify and

and Benchmarking of

consumers

respond to the diverse and

competitorsto reduce the

changing needs of customers

problems oftechnology,

(S2, S4, T1, T5)

reduce costs andenhance

T2. Importing products


from China
T3. High inflation rate
might raise operating
cost significantly
T4. rising cost of raw
materials
T5. Global trend towards

Market Development
ST2. development of Interaction
with external and
professional sellers

quality (W1, W2, W3, W4,


W5, T2, T3, T4, T5)
Product Development
WT2. Continuous improvement of

international marketing

quality and cost structure to

(S2, S5, T5)

increasing international

improvement of the

competition(W4, W5, T2,

overall products

T5)

quality.

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6.0
1)

2)

3)

Ratio Analysis
Formula
Current ratio =

5)

6)

7)

8)

9)

10)

2013

= 7.48 : 1

= 6.68: 1

= 4.57 : 1

= 4.63 : 1

= 105,58 days

= 96.69 days

= 3.46 times

= 3.77 times

= 7.11 times

= 8.18 times

= 2 times

= 2.60 times

= 0.59 : 1

= 0.7 : 1

= 1.54 : 1

= 1.93 : 1

= 0.12 : 1

= 0.13 : 1

= 0.13 : 1

= 0.15 : 1

Quick ratio =

Average collection period =

Account Re ceivable
AnnualCreditSales

Accounts Re eivable
4)

2012

Receivable turnover =

Payable turnover =

Inventory turnover =

Total assets turnover =

Fixed assets turnover =

Debt ratio =

Debt equity ratio =

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11)

12)

13)

14)

15)

16)

17)

Times interest earned =


= 3.78 times

= 3.94 times

= 10. 92%

= 10.65%

= 10.45%

= 10.32%

= 8.15%

= 8.03%

= 4.79%

= 5.64%

= 5.43%

= 6.43%

= RM 6.85 per syer

= RM 8.15 per syer

Gross profit margin =

Operating profit margin =

Net profit margin/Return on


Sales(ROS) =

Return on assets(ROA) =

Return on equity(ROE) =

Earnings per share(EPS) =

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A)

Current Ratio

Current Ratio

2012

2013

Changes

7.48

6.68

Down 10.70%

By this ratio we can see that, this companys current ratio is 7.48 in the year of 2012 and
6.68 in the year of 2013 which is lower than 2012. So companys current ratios change is
decrease 10.70%.
B)

Quick Ratio

Quick Ratio

2012

2013

Changes

4.57

4.63

Up 1.32%

By this quick ratio, we can see that in the year of 2012, this companys quick ratio is
improved than the year of 2013 & its percentage change is grow up to 1.32%. That is
better for this company.
C)

Total Debt Ratio

Total Debt Ratio

2012

2013

Changes

0.12

0.13

Up 8.33%

Here, we find that, in year 2013 percentage of total debt ratio grows up from 0.12 to 0.13
than the year of 2012. For this increasing of the total debt ratio, this company is now in a
bad position.
D)

Total Equity Ratio

Total Equity Ratio

2012

2013

Changes

0.13

0.15

Up 15.38%

By this ratio we can analyses that, this companys debt equity ratio is grow up in 2013
than 2012. So, it is not favorable for this company.

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E)

Return On Assets (ROA)

Return on Assets

2012

2013

Changes

4.79

5.64

Up 17.75%

(ROA)
By this ratio we can see that this companys return on asset is increase in the year of 2013
than 2012 & its percentage change is growing up to 17.75%.
F)

Return on Equity (ROE)

Return on Equity

2012

2013

Changes

5.43

6.43

Up 18.42%

(ROE)
This companys return on equity is also growing up in 2013 than 2012 which is 18.42%.
G)

Earnings per share (EPS)

Earnings per share

2012

2013

Changes

6.85

8.15

Up 18.98%

(EPS)

It can be say that the EPS are increase from year 2012 to 2013 which is 18.98%, therefore,
it become more dividens can be received after each shares owned.

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H)

Cash Conversion Cycle

Inventory Turnover

Receivable Turnover

Average Collection
Period

Payable Turnover

2012

2013

Changes

2.60

Up 30%

2012

2013

Changes

3.46

3.77

Up 8.96%

2012

2013

Changes

105.58

96.69

Down 8.42%

2012

2013

Changes

7.11

8.18

Up 8.96%

Formula

2012

2013

Collection Period

105.49

96.82

Inventory

182.5

140.38

51.34

44.62

Conversion
Payment deferral
period

Cash Conversion Cycle = (Collection period + Inventory conversion period) Payment


deferral period
Cash Conversion

2012

2013

Changes

236.65

192.58

Down 18.62%

Cycle

So, it is efficient for this company.

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7.0

Strategic Direction

In order to conclude the TOWS and SWOT analysis we will say that Yi-Lai Industry
Berhad needs to consider many aspect of its current way of doing business and try to
combine its strength with the opportunities arising from the external environment. One
the other hand, the company must be aware of the weak side of its current strategy and try
to minimize the risk coming from outside threat. There are quite few of strategies that can
be used:
A)

Market Development

Adapt strategies to consumer needs


Its an important task for Yi-Lai Industry Berhad to better understand the habits of
customers, their lifestyle tastes, colour preferences, social patterns, as well as
environmental conditions and other contributing factors that help us determine the
best designs for each target market. This would help Yi-Lai Industry Berhad to
steal more market share if the products supply is over demand by the customer
due to their needs.

B)

Strategic Alliance

Strategic alliance is a new concept in the lodging industry which involves strategic
collaboration and working relationships with one or more partners to create joint
authority and structure to carry out a common mission. Strategic alliance often formed
with competing firms that possess complementary skills and resources. For example, if
Yi-Lai Industry Berhad collaboration with other country ceramic tiles company. Both
company can shared expertise, more clout, and a greater range of knowledge and also
open the opportunity of international market. Hence, enhance the overall quality of good
produce,and reduce costs .

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C)

Product Development

Product development can be defined as improving an existing product or developing new


kinds of products. Product development is important to ensure that the products or
services remain competitive. The company can be benefited from this strategies and it is
important to increase uniqueness and competitive position in their arena.
Yi-Lai Industry Berhad continues innovating in order to become the leaders in
Malaysia's tiles industry. Reconstruction and modernization of existing technology of
Ceramic Tiles to meet the international standard by improving the quality and develop it
into international marketThe consultant should identify types and quantities of equipment
necessarybetter facilities and test equipment.
Thus, constant investments in high quality and efficient production processes,
cleaner technologies, logistics systems and innovative products, while maintaining a
trained and motivated workforce, must be continued and encouraged.
D)

Market Penetration
Strategies that are formulated from the TOWS analysis are market penetration.

Market penetration can be defined as seeking increase market share for present products
or services in present market through greater marketing efforts. The company needs to
penetrate the market by advertising or promoting. This strategy will help the company
with greater opportunities destination marketing and benefits that derived from
economies of scale. For example, Yi-Lai Industry Berhad may launch an advertising
campaign to generate greater brand awareness or implement a short-term promotion with
a finite ending date. A promotion is often linked with pricing, such asadvertising a special
sale price for a limited period. A competitor may counter a successful promotion with
one of its own in an attempt to regain lost market share.

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8.0

Best Strategies Recommendation

Within these 4 strategies, Market Development, Strategic Alliance,Product Development


and Market Penetration, we recommend that the Product Development strategy is the
most suitable for Yi-Lai Industry Berhad operation.
Product Development strategic occurs if company willing to invest more in the
Research and Development to produce a new product or improve existing products. YiLai Industry Berhad need to capable in this strategic technology that consistently focus in
Resource and Development process. The Resource and Development help a company to
invest in new products or innovative products and services. Having world control facility,
Yi-Lai Industry Berhad need to do more in Research and Development and to be strong
in this field to using the facility to control and produce the products. For example, Alpha
Tiles already specialized the tile production technologie and it was the first in Malaysia to
offer Slate Effect Homogenous Tile that today only remains one of the few manufacturers
that can produce beautiful and strong tiles in Malaysia.

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9.0

References

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b)

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c)

David, Fred R. (2011) Strategic management: concepts and cases, Upper Saddle
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d)

EC (2007a), Reference Document on Best Available Techniques in the Ceramic


Manufacturing Industry, August 2007. Conference,4-5 September, Tehran.

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Hunger, J. David and Wheelen, Thomas L. (2011) Essentials of strategic


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Hill, Charles W. L. and Jones, Gareth R. (2009) Theory of Strategic Management,


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g)

Hosseini SM, Panahi M. 2007 .creating competitive advantage in the tile industry
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Jalilians J, Akbari P.2013. A comparative study of strategic management and


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Competitive Markets, Pearson Education Limited, UK.

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