Corporate Strategy of Beximco Group and Porter's Five Forces and Value Chain Analysis of Beximco Pharmaceuticals.

1. i
A REPORT ON
Corporate Strategy of Beximco Group and Porter's Five
Forces and Value Chain Analysis of Beximco Pharmaceuticals
Strategic Management
MGT-4202
SUBMITTED TO
Dr. Liza Khanam
Associate Professor
Department of Management Studies
Jagannath University
SUBMITTED BY
B160202045 to B160202055
BBA 4th
year 2nd
semester
SECTION: A
Department of Management Studies
Jagannath University
SUBMISSION DATE: 31/01/21

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Group Members
Serial
No.
Name ID No. Remarks
1. Kakoly Akter Tamanna B160202045
2. Rakibul Islam B160202048
3. Farzana Akter Opiya B160202049
4. Anupam Chowdhury B160202050
5. Mohsin Gazi B160202053
6. Farhan Shehab (GL) B160202054
7. Mahedi Hasan B160202055

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Table of Contents
Table of Contents ...............................................................................................................iii
Abstract............................................................................................................................... 1
Chapter One ........................................................................................................................ 2
1. Introduction of Beximco Group.............................................................................. 2
1.1 Corporate Strategies of Beximco Group:...................................................... 2
1.2 Advantage through COVID-19:.................................................................... 7
Chapter Two........................................................................................................................ 8
2. Introduction of Beximco Pharmaceuticals Ltd: ...................................................... 8
2.1 Corporate Governance & Committees:......................................................... 8
2.2 Corporate Strategies:..................................................................................... 9
Chapter Three.....................................................................................................................11
3. Porters Five Forces Analysis..................................................................................11
Chapter Four ..................................................................................................................... 13
4. Value Chain Analysis of Beximco Pharmaceuticals Ltd:...................................... 13
4.1 Primary Activities: ...................................................................................... 14
4.2 Support activities: ....................................................................................... 15
Conclusion ........................................................................................................................ 17
References......................................................................................................................... 18

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5. 1
Abstract
Beximco Group is a well-recognized group in Bangladesh and it has strategized in many
fields of Businesses. In this study, we covered the Key Corporate strategies undertaken by
The Beximco Group. We found that Beximco Pharmaceuticals is their principal business,
and the pharmaceutical company of Beximco Group was so successful that it was the first
Bangladeshi company that is listed on the London Stock Exchange. So we analyzed the
pharmaceuticals business by Porter's five forces model and Value Chain Analysis. We
presented the findings and analysis in this report logically. The corporate strategies of the
Group are also presented with a brief explanation. For the source we collected the
information from different official websites, newspapers, articles and Research journals
which are secondary source.

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Chapter One
1. Introduction of Beximco Group
One of the oldest and most famous business groups is BEXIMCO, a legendary group of
companies in Bangladesh. The Bangladesh Export Import Company Limited is a
multinational conglomerate holding company headquartered in Dhaka, Bangladesh,
commonly known by its trade name, BEXIMCO (Wikipedia, 2020).
Two brothers, Ahmed Sohail Fasihur Rahman and Salman Fazlur Rahman, formed
BEXIMCO in the 1970s. It is one of Bangladesh's best and most trusted organizations, with
a variety of business operations in many areas. The Group has grown from being mainly a
commodity trading company since the early days to a leading, diversified group with a
presence in sectors of industry that account for almost 75 percent of Bangladesh's GDP.
"Taking Bangladesh to the world" is the corporate mission of the Group (Beximcoltd.com,
2011).
Beximco is the top conglomerate in Bangladesh, with the leading market capitalization in
the country's share market. The Beximco Industrial Park in Gazipur, Bangladesh, is its
major production base. The Group comprises four publicly traded firms and seventeen
privately owned. Bangladesh Export Import Company Limited, Beximco Pharmaceuticals
Limited, Shinepukur Ceramics Limited, and Beximco Synthetics Limited are public
companies (Beximcoltd.com, 2011).
1.1 Corporate Strategies of Beximco Group:
Mission:
"Taking Bangladesh to the world" is BEXIMCO's corporate mission (www.beximco.com,
2010).
Investment in Diversified Sectors:

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Beximco Group practices low levels of diversification through their business operations
and investments, as the 70-95% of revenue comes from a single dominant business of
Beximco Group, which is Beximco Pharma. According to Hitt et al. (2017), a firm which
practices dominant-business diversification strategy will generate revenue between 70-
95% of total revenue of that business group or firm. Although Beximco Group pursues
Dominant strategy, it has many diversified sectors of business production. The flagship
platform now has operations and acquisitions across a broad range of sectors, like textiles,
pharmaceuticals, PPE, ceramics, real estate investment, construction, exchange, marine
food, information and communication technology, media, DTH, financial services, and
energy, as BEXIMCO has expanded over the years. Beximco Group has investment in 17
different sectors (Wikipedia, 2020):
1. Aviation
2. Banking
3. Shinepukur Ceramics Limited
4. Construction
5. Electric Power Generation
6. Fashion
7. Fisheries
8. Hotels
9. Information Technology
10. Akash-DTH
11. Private Satellite Television Channel
12. Jute
13. Media
14. Petroleum Products

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15. Pharmaceuticals
16. Real Estate
17. Textiles
Four traded publicly and seventeen privately run firms are taking part in the conglomerate
that are also described following:
1. The Beximco Group.
2. Beximco Jute Division: New Dacca Industries Ltd (NDI), a corporation centered
in Beximco, is 53 years old. NDI yarn is currently used in America and Europe by
the top global carpet and rug makers.
3. Beximco Pharma.
4. Beximco Synthetics Ltd: Processing and distribution of Polyester Filament Yarn,
Partially Oriented Yarn (POY) and Draw Texturized Filament Yarn (DTFY) are
the principal activities of the business.
5. Bangladesh Export Import Co. Ltd.–Textiles & Apparel Division: Bextex Ltd.
was founded as a public limited corporation in Bangladesh on March8, 1994.
Bextex Ltd. is the continent's most advanced composite plant. Bextex Ltd. has a
state-of-the-art manufacturing facility for composite knit fabrics, which meet the
rising needs of export markets of high-quality knit apparel in Bangladesh.
6. Shinepukur Ceramics: Shinepukur Ceramics is Bangladesh-based ceramic
production firm. The Company is also the top exporter of ceramics in Bangladesh.
SCL is the leader in the ceramics industry in Bangladesh and is currently ranked 1

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in terms of sales and earnings. It also has over 250 distributors in the
Bangladesh's market to sell and distribute SCL goods.
7. Beximco Petroleum Ltd: Beximco Empire has expanded into the energy market
through Beximco LPG Unit-1 Ltd. under its goal of bringing Bangladesh
to worldwide, promising to ease the growing gas shortage in households and
factories.
8. Beximco Power Company Ltd.
9. Beximco Engineering Limited.
10. Bangladesh Export Import Co. Ltd.–Marine Foods Division.
11. Bangladesh Export Import Co. Ltd.–IT Division.
12. Bangladesh Online.
13. IFIC Bank: In Bangladesh, International Finance Investment and Commerce
(IFIC) Bank Limited is a leading banking institution owned by Government
and Beximco.
14. Yellow: Yellow is an apparel brand and clothes retailer headquartered in
Bangladesh and run by Beximco. Along with Stores in Bangladesh, it has several
stores in Pakistan, Dubai, Toronto, and New York City.
15. The Independent: The Independent is a Daily English national newspaper based
in Dhaka, Bangladesh.
16. Independent Television: Independent Television Ltd is a 24x7 news station that
is private, which is held by one of Bangladesh's biggest group, Beximco.
17. Akash DTH.
18. Bangladesh Export Import Co. Ltd.–Real Estate Division.

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19. Beximco Computers Ltd.
20. Dhaka Dynamites.
21. Bextrade Limited.
22. Beximco Securities Limited.
23. Beximco Communications Ltd. (DTH): The very first "Direct-to-Home" (DTH)
facility to provide citizens of Bangladesh with global TV visual experience was
launched by Beximco Communications Limited. DTH is a multimedia technology
which provides audiences the ability to get TV signals with HD image and sound
quality straight from the satellite.
24. The Westin Dhaka: By investing about TK 160 crores in the Westin Hotel,
Beximco Company has diversified into the hospital market. Approximately 5
percent of the shares in Unique Hotels and Resorts, the holders of The Westin
Dhaka, will be owned by Beximco.
25. Shinepukur Cricket Club.
26. Giga Tech Ltd.
27. Beximco Dhaka.
28. GMG Airlines: In Bangladesh, GMG Airlines, was the first airline in the country
and, until lately, the leading corporate airline, founded in 1997.
29. Bextrade Limited: BEXTRADE Limited is a subsidiary of the Beximco Group, the biggest
Bangladesh Business Empire, and over the years after1993, an IATA-accredited
specialist firm for Travel Based Services in Bangladesh, began a path of vast
experience.

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1.2 Advantage through COVID-19:
The BEXIMCO PPE Unit, which supplies the highest grade of globally approved PPE
products for clinical usage, has recently unveiled their latest Segment. Beximco
Pharmaceuticals distributed and supplied the corona vaccines from the Serum Institute of
India Pvt. Ltd. The strategic move from Beximco gained the First mover advantage in this
pandemic situation when the world nations are practicing vaccine nationalization and
politics. The Strategic move will provide the conglomerate Global recognition and it will
enhance brand image to a next level.

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Chapter Two
2. Introduction of Beximco Pharmaceuticals Ltd:
Beximco Pharmaceuticals Ltd. is Bangladesh's leading pharmaceutical corporation.
Established in1976, Beximco Pharmaceuticals Ltd., according to Current Good
Manufacturing Practice (CGMP), has been producing world-class pharmaceutical products
as mandated by the World Health Organization (WHO) to encourage healthy wellbeing and
quality of life. With a footprint in 55 countries; Generic prescription formulation materials,
active pharmaceutical ingredients (API) and intravenous (IV) fluids are manufactured and
marketed by the Pharmaceuticals division. The company is also one of the country's biggest
pharmaceutical suppliers and its state-of-the-art production facilities are accredited by,
amongst many others, the international regulatory bodies ofAustralia, the European Union,
the Gulf Nations, and Brazil. Beximco Pharmaceuticals Ltd is the first US FDA approved
company in Bangladesh (Md. Hafiz-Al-Asad., 2016). The company continues to expand
on its own portfolio and currently manufactures over 500 drugs in various dosage forms
covering wider therapeutic segments.
2.1 Corporate Governance & Committees:
The Company has a three-tier management structure, comprising the Board of Directors,
the Executive Committee and the Management Committee. There is also an Audit
Committee, constituted in 2006.
Comprising the Board of Directors, the Executive Committee and the
Management Committee, the Company has a three-tier organizational structure. The Board
of Directors is the maximum level of authority within the organization, consisting mostly
of non-executive directors, none of whom earn compensation of directors. The Board meets
twice a year with Executive Committee, which comprises six Executive Directors, to
thoroughly review the activities of the Company.

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2.2 Corporate Strategies:
Mission:
"We are committed to enhancing human health and well-being by providing contemporary
and affordable medicines, manufactured in full compliance with global quality standards.
We continually strive to improve our core capabilities to address the unmet medical needs
of the patients and to deliver outstanding results for our shareholders." (Admin, 2021b)
Vision:
"We will be one of the most trusted, admired and successful pharmaceutical companies in
the region with a focus on strengthening research and development capabilities, creating
partnerships and building presence across the globe." (Admin, 2021b)
Five Core Values of BPL (Admin, 2021b):
 Commitment to quality: In all their activities, they follow best business practices
in order to reach the best standards of quality for their goods.
 Customer satisfaction: They are dedicated, both internally and externally, to
meeting the needs of its clients.
 People focus: They give top priority in developing their employees' skills and
inspiring them to realize their full ability.
 Accountability: They advocate honesty in what they do and rigidly adhere to the
highest ethical principles. They are concerned for their own acts and liable for
upholding the integrity of the company.

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 CSR: The firm engages actively in programs that support societies and add value
to people's welfare. In conducting their activities with great regard for safety and
also the climate, they take special care.
Market Share:
Figure: Pie Chart of Market Stake of Topmost 10 Pharma in Bangladesh.

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Chapter Three
3. Porters Five Forces Analysis
Based on the analysis of the five factors established by Michael E. Porter, the managers of
Beximco Group will understand the current situation of the market. The strengths and
weaknesses of the organisation can be sorted out easily throughout the analysis. The
Porter's five analyzes for Beximco Group are as follows.
Industry Rivalry:
The rival organizations of the Beximco Group are in the highest position of risks in the
competitive market. As Incepta, Acme, Square are the best competitors of the group of
company. Especially the pharmaceutical sector is at the highest risks in the survival market
(Bruijl, 2018). So, the strategic managers of the Beximco Group have to maintain the
competitor's analysis perfectly for setting strategic goals.
Threats of New Entrance:
The entrance of the new organisations can affect the strategies of the Beximco Group.
Though the organisation has a great brand value and position on the customer's mind, the
managers of the organisation have to be concerned about the new organisations (Al
Mamun, 2019). The offers and incentives by the new entrance organisation with the high-
quality products can attract customers that will be challenging for Beximco to recover
those.
Bargaining Power of the Suppliers:
The bargaining power of the suppliers is at a moderate level for the Beximco Group. As it
is one of the renowned organisations and groups of the company in Bangladesh, it has a
good relationship with the suppliers of the market. However, there are chances to lose the
suppliers because of the competition (Al Mamun, 2019). The competitors can agree with
the bargaining of the suppliers and can buy products with the least price.

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Bargaining Power of the Consumers:
The bargaining power of the consumers of Beximco Group is at the lower level, as the
organisation provides the products and services with the MRP. So, the customers have little
right to bargain with the prices. But to maintain the satisfaction of the customers, the
managers of Beximco Group have to be concerned about total quality management (Bruijl,
2018). Otherwise, it will be impossible to keep the customer's value.
Threats of Substitute Products:
There are fewer risks for Beximco Group to deal with the substitute products. Especially
the organisation earns a massive revenue from the pharmaceutical sectors. So, it is
impossible to make clone products or substitute products against any medicine or surgical
items (Al Mamun, 2019). So, the thing is that the managers of the organisation have to
ensure the proper quality of their products and services.
Figure: Porters Five Forces Analysis.
Source: Bruijl (2018)
Industry
Rivalry
Threats of
New
Entrance
Bargaining
Power of
the
Suppliers
Bargaining
Power of
the
Consumers
Threats of
Substitute
Products

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Chapter Four
4. Value Chain Analysis of Beximco Pharmaceuticals Ltd:
A value chain is a technique undertaken by a business operating in a sector so that it can
provide the market with a valuable commodity or service (Wikipedia Contributors, 2019).
The value chain reflects the internal operations in which an organisation is engaged when
turning raw materials into finished products. Value chain analysis (VCA) is a technique by
which an organisation sets the basic activities that contribute to its final product or
service and then tests for profit maximisation (Ovidijus Jurevicius, 2013).
Beximco Pharmaceuticals Limited needs to focus its competitive advantage on operations,
where it has access to resources that are scarce. The Value Chain Analysis would help the
organisation define those roles and improve those areas.
Beximco Pharmaceuticals Limited also have to analyse by VCA on the basis on their
internal operations to identify which operations are the company's most important (i.e. the
origin of cost or differentiation benefit) and which ones could be strengthened to
attain competitive advantage. The analysis reveals where the competitive advantages or
disadvantages of Beximco Pharmaceuticals Limited are, by looking into internal operations
and capabilities. So the firm will understand whether to follow Cost Advantage or
Differentiation Advantage.
Value Chain Analysis (VCA) is widely used to understand the internal environment of a
Manufacturing or Servicing Business. So the VCA strategy will be used in this study to
understand the Internal Environment of Beximco Pharma Ltd.
Value Chain Analysis for Beximco Pharma is very crucial because it can:
1. Recognize competitive advantages
2. Pinpoint difficult interconnections and interrelationships
3. Increased flow of raw materials, data and funds

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4. Construct suitable strategies unique to the firm
Figure: Porter's Generic Value Chain
 As suggested by Porter, below is the description of main value chain operations
(Essay48, n.d.) (Rohmotullah, n.d.):
4.1 Primary Activities:
Beximco Pharmaceuticals Limited's prime supply chain operations are deeply involved in
manufacturing and marketing the product to targeted consumers. As described following,
evaluation of prime activities of value chain will enhance Beximco Pharmaceuticals
Limited's productivity.
1. Inbound Logistics (material procurement):

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Beximco Pharmaceuticals Ltd (BPL) needs to source its raw materials for goods in a cost-
effective way. Quality raw materials should guarantee the quality of finished goods.
2. Operations (turn into final product):
Global Multinational companies such as Bayer, Germany and Upjohn, USA, are
outstanding in technology, because they have innovative processing processes to transform
the raw materials into a finished product of quality. The whole idea should be to efficiently
and effectively turn the raw materials into the finished product.
3. Marketing (marketing and sales):
Marketing and distribution should able to influence the market segment. The product sales
and marketing strategy are more systematic and advanced.
4. Servicing (service after the sale):
After sales service should satisfy the consumers. So after purchasing the commodity, they
don't fall into uncertainty or difficulties.
4.2 Support activities:
1. Procurement: To ensure optimal supply chain operations, well-trained
procurement is important. The inputs necessary to manufacture drugs are complex
in design and therefore care must be taken so that reliable inputs are assured by
procurement.
2. Technology development: As previously outlined, MNCs such as Bayer, Germany
and Upjohn, the USA, are good in advanced technology for which top-quality
production is not an issue for them. Beximco Pharma is among the largest drugs

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exporters in Bangladesh, capturing a record five-time National Export (Gold)
Award (Admin, 2021).
3. Human resource management (HRM): The central area of all management
activities is planning. It is the base upon which the firm has to develop the other
three areas. Planning needs management to consider where the business's human
capital is now positioning, and where they want to be in the future. From there, an
effective course of action is developed and enforced to achieve the goals and
objectives of the organization.
4. Firm's infrastructure: This applies to the structure of an enterprise and its
processes for management, planning, accounting, financing and quality assurance.
Beximco Pharmaceuticals Ltd (BPL) should maintain that they have a proper
management that can properly control all activities, have an expert team that takes
care of finance and accounts so that no abuse occurs and that proper budgeting can
be carried out and that strict Total Quality Management (TQM) is maintained so
that the final goods are strictly meeting the quality conformance.
BPL is regulated and administered entirely by a corporate entity. The firm's leader
is the Ceo and the overall operation is split into divisions of Marketing, Sales,
Commercial, Manufacturing, Finance and Accounting, Product Planning,
Company Research and Development, and MIS departments each monitored by a
director. Directors of the departments directly report to the CEO. BPL built its
organizational structure to be highly adaptive and versatile, considering the
dynamic environment. It is a learning organization that has developed the ability to
learn, adapt and grow continuously.

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Conclusion
The overall situation and business strategies of the renowned organisations all over the
world has been changed because of the impact of Covid-19. To maintain the competition
in the survival market, the managers of Beximco Group are also changing their corporate
strategies. To identify the competition in the market for the organisation, Portes five
analysis and value chain analysis has been discussed in the report. The influences of the
Covid-19 for Beximco also has been discussed in the report to achieve the learning
outcome. In future, we may see Beximco in a strategic position where it will tackle tough
situation like Covid-19.

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