– Durga Chudal
Cement industry is regarded as the most important economic driver in Nepalese economy. These days, there are approximately sixty cement companies, are manufacturing cement products. These can be classified into two categories in terms of their process of production. First category is clinker based and second one is grinding unit only, some of them are owned by government itself and many of them are under private ownership. Whatever the structure is, the market is same. In terms of payback period, cement industry has long gestation period as compared to other industry in Nepal. Cement product is regarded as the most perishable product. In this world, every business is breathing under the demand supply theory, but sometimes Nepalese cement industry has proven as inconsistence movement to demand supply theory, for example they enjoyed additional premium of hundred and fifty rupees per sack during the period of 2016; even there were constant many other factors which are included in the model of price as dependent variable equation.
Study shows that the sales volume at individual level is reflected by the change in price. It results lack of loyalty to the brand of cement due to availability of multiple options for the customers and negative pricing while attracting new customers. Also shows that the selection of brand is directly affected by the price of commodity rather than other factors. In this 21st century, every single person can calculate the cost of capital and due to globalization there is no boarder within the world at all. So every business should have consistence behavior towards the customers also strategic decisions are required. Study shows that many top listed companies are ignoring the ethical phenomena of the business; same customers are treated differently at different time. For example rainy season invites more generosity in their behavior but in summer vice versa they appear as their own original position of individualistic trait domain, reason is that the level of demand is increased and the level of production remains same. The trend of cement price during last eleven years can be postulated as following.
(In this figure Y axis represents price of cement and X axis represents year 2010 to 2020)
Automated operation system replaces the number of human resource in the field of business and other area but it creates additional creativity to the human resource also. But scenario shows that the inverse relation to the reality in terms of cement industry in Nepal. This is the age of human resource accounting but no scientific human resource management system is deploying, resulting decreasing in organizational performance such as financial performance, employee satisfaction, customer loyalty and other indicators as proxy of organizational performance. Common practices are following shareholder theory of corporate social responsibility, until and unless implication of stakeholder’s theory is not followed, there will be intricate for the existence because the world is surviving give and take procedure.
As we know Cement Company in Nepal are mushrooming, but the cement market is limited within the country. Due to global warming awareness and government policy regarding high rise building, average demand is not increasing significantly. A prediction can be made that the healths of cement industry will more sympathies in coming days.
(Mr. Chudal is Senior Sales Manager of Maruti Cement Limited)