1. T H E E VO L U T I O N
CERAMICS AS AN END PRODUCT
Context and Scope of project
On July 9th
, 2012, four students from University of Redlands School of Business, in
conjunction with Birmingham City University were tasked with researching new
revenue and growth opportunities for Doncasters Ceramics. This report summarizes
the findings and opportunities the student consultants have indentified as possibilities
for Doncasters Ceramics.
Student Consultants
KRISTA-NICOLE BISHOP, MICHELLE CHURCHILL, RYAN COBB, JOSH
GOLDMAN
3. Page 3 of 67
EXECUTIVE SUMMARY
Imagine yourself biting into a crisp pizza perfectly made by the use of a ceramic brick
oven. The gooey cheese graces your lips. You watch as the chef cuts the vegetables
perfectly with the precision allotted by his ceramic knife. On the television,
announcers discuss the high performance ceramic braking systems in Formula 1 cars.
The next day on the golf course you notice the water features are looking especially
clear and overhear the groundskeepers discussing the new ceramic filters. It occurs to
you how often the options of ceramics are now increasing efficiency and the quality of
goods in the marketplace.
The consulting team from University of Redlands, in conjunction with Birmingham
City University, was asked to research new growth opportunities for Doncasters
Ceramics. Given the restrictions and current needs in the marketplace, the most viable
options lead Doncasters Ceramics to switch their focus to, ceramics as an end product.
The consultancy team has entitled this, “The Evolution of Doncasters Ceramics”.
4. Page 4 of 67
1.0 OVERVIEW
RELEVANCE
The demand for ceramic products is quickly evolving as businesses and consumers
switch to metal alternatives. New applications for ceramics are being developed daily
and ceramic products are often found to be more sustainable.
THE PROBLEMS
Doncasters Ceramics recognized a growing need to evaluate new revenue
opportunities for the factory in Droitwich Spa, England. The consulting team spent
four days analyzing Doncasters Ceramics’ most pressing issues. Doncasters Ceramics’
executive team members explained that the current situation was not sustainable and
the factory must look at other opportunities for revenue generation.
Some of the key facts upon the initial meeting:
The current factory is only operating at 40% of its capacity.
Investing large capital in state of the art robotics, to keep up with the current
competition, does not make sense at this time.
Doncasters Ceramics must look into other products they can produce outside of
aviation.
These products must have low barriers to entry, generate revenue quickly, require
minimal capital investment, and be sustainable revenue streams.
THE SOLUTIONS
The consulting team looked at products in several stages, in which Doncasters
Ceramics can implement over time to increase revenue. The stages are Short-Term
(one to three years), Mid-Term (three to five years), and Long-Term (five to ten
years). The team, researched ideas that fell into each group, selected the top options,
and then vetted multiple options with senior Doncasters Ceramics’ staff. The most
viable selections were researched further and presented to Mark Ward and Paul
Hancock. During the course of research, the team discovered that the best opportunity
requiring the least investment, with the highest potential for profit, is for Doncasters
Ceramics to explore ceramics as an end product.
From these discussions, the selected ideas by Doncasters Ceramics were:
5. Page 5 of 67
1. Short-Term (1-3 years), estimated £75,000 investment
Ceramics Brick Ovens
Ceramics Cutlery (slightly higher capital requirement)
2. Mid-Term (3-5 years), estimated £150,000 plus investment
Ceramics Brakes
3. Long-Term (5-10 years), estimated £300,000 plus investment
Ceramics Filters
Short-Term options call for strategic partnerships. Doncasters Ceramics can become a
supplier to different companies, which produce ceramic bricks ovens and cutlery. The
Mid-Term suggestion of high-end ceramic brakes will leverage partnerships with
Doncasters’ existing automotive division. The Long-Term suggestion of ceramic
filters requires R&D. Large, high-end water features or municipality filters have yet
to be fully researched, manufactured, and implemented in the marketplace. This also
provides an opportunity for Doncasters Ceramics to develop their own, patented
ceramic filters.
WHY NOW – URGENCY
Doncasters Ceramics’ current business model is not sustainable based on feedback
from the initial meeting; revenue must increase within the next twelve months.
Ceramics provide significant opportunities for the future - Doncasters Ceramics is
already an expert within many segments of high-end ceramic manufacturing.
In the following consulting report, you will find an in-depth analysis of each
opportunity, industry-networking suggestions, other opportunities for growth, and
references. A digital appendix of larger items is also included.
6. Page 6 of 67
2.0 RESEARCH APPROACH
MONDAY JULY 9TH
2012
Meeting with Doncasters Ceramics executive team
Tour of factory
Light discussion of Doncasters Ceramics goals, budget, and factory production
capabilities
TUESDAY JULY 10TH
2012
Research at Birmingham City University
Idea development, vetting, and research amongst the consultant team
WEDNESDAY JULY 11TH
2012
Research and idea vetting day at Doncasters Ceramics
Idea vetting with senior staff
THURSDAY JULY 12TH
2012
Development and research of selected ideas from Wednesday’s meeting.
Development of presentation
FRIDAY JULY 13TH
2012
Final presentation at Doncasters Ceramics to Mark Ward and Paul Hancock
Mark and Paul identified the solutions of most interest and where they would
like the consultant team to expand their research
Team headed back to the states to develop the final, more in-depth, report for
Doncasters Ceramics
Team utilized their networks, industry publications, industry professionals and
resources on the web to acquire the most accurate and up to date information
for the final report
7. Page 7 of 67
3.0 KEY FINDINGS
After evaluating many possible opportunities, the team decided that the best decision
would be for Doncasters Ceramics to look at ceramics as an end product. There are
several opportunities for Doncasters Ceramics to capitalize on in this space. Given
Doncasters Ceramics fragile financial state, it was imperative that the team develop
short-term, mid-term, and long-term sustainable revenue generating opportunities. The
team felt that Doncasters Ceramics would benefit from several opportunities ranging
from those that could be implemented immediately at low cost to future opportunities
which will keep Doncasters Ceramics ahead of competitors. Through this evaluation,
the team decided to break opportunities up into three time and investment categories.
Ideas, which can be implemented immediately, and have the lowest requirement for
investments are listed in the short-term category. The research suggests that
Doncasters Ceramics can accomplish the opportunities in this category within one to
three years at an initial investment of roughly £75,000. The mid-term category can be
implemented in three to five years with a rough investment of £150,000. The final
category includes new technology, which is not proven, and may take five to ten years
to implement. This category may cost around £300,000 due to research and
development needs.
3.1 PROJECT CLASSIFICATION MATRIX
8. Page 8 of 67
4.0 SHORT-TERM OPPORTUNITIES
4.1 CERAMIC OVENS
Ceramic Brick Ovens provide an opportunity for Doncasters Ceramics with the lowest
risk. This opportunity requires the least amount of investment and Doncasters can
have production up and running quickly.
4.2 CERAMIC CUTLERY
Ceramic Cutlery will take a bit more investment than ceramic brick ovens, however,
there is opportunity in the marketplace. Doncasters Ceramics has an opportunity to use
a partnership to strategically gain a piece of this market as a manufacturer in the
process.
9. Page 9 of 67
4.1 CERAMIC BRICKS
OVERVIEW
Refractory bricks, which are often marketed as
firebricks or insulation bricks, have a vast usage in the
lining of kilns, fireboxes, fireplaces, pizza ovens, and
hundreds of other applications. The demand for
ceramic bricks in the worldwide refractory construction
market ranges from basic shapes to high-end specialty
shapes and colors.
Firebrick manufacturers create opportunity by varying the composition ratio of
aluminum oxide (alumina) and silicon dioxide (silica). A higher concentration of
alumina allows the bricks to refract more heat (1,700C+)4. The basic rectangular size
is 230mm X 114mm with various thicknesses which can either be molded during
manufacturing or cut using a diamond blade masonry saw for various thickness and
angles for arches, corners, etc. The flexibility to modify the mineral ratios can allow
Doncasters Ceramics to create bricks that have a number of
different applications simply by changing the mixture of the
slurry when manufacturing the firebricks. This flexibility at
a low cost will allow Doncasters Ceramics to enter the
market of ceramic bricks with low investment in machinery
and low human capital in research and development.
OPPORTUNITY
There is a wide range of opportunity in the firebrick industry. The opportunities come
in various dynamics ranging from time to market, capital needs, and difficulty.
Doncasters Ceramics’ current factory capabilities will allow them to enter the firebrick
industry with low investment, minimal difficulty, and with a quick turn-around time.
Simply put, this is a minimal risk opportunity.
Doncasters Ceramics will be able to enter into the firebrick market in six to twelve
months, with minor capital expenditures, and minimal research and development.
Research suggests that the current team at Doncasters Ceramics, should be able to
handle the necessary research and development to enter the firebrick industry. This
offers another opportunity to save costs.
Builders and architects throughout England and the world specify firebricks for their
clients when building and designing finished products for industrial, commercial, and
10. Page 10 of 67
domestic buildings. Therefore, Doncasters Ceramics should create partnerships and
strategic alliances with builders and architects, resellers, and manufacturers. These
strategic partnerships will strengthen Doncasters Ceramics’ initial market entry and
operations while creating the ability for industrial knowledge sharing, which will
ultimately create a favorable competitive environment.
For example, to create an initial strategic partnership, Doncasters Ceramics should
consider contacting Mr. Meller, the director if Vitcas Ltd., and set a meeting to
introduce Doncasters Ceramics and discuss the industry as a whole. There are several
high level synergies that may exist between Doncasters Ceramics and Vitcas.
Whether it is manufacturing items for Vitcas or creating a joint venture, these
opportunities will create a great entry point into the market for Doncasters Ceramics.
Also, these opportunities will strengthen Doncasters Ceramics’ knowledge in their
physical capacity and positioning in the market similar to the initial partnership and
acquisition that started the company.
REFRACTORY CERAMICS AND BRICK MARKET
On a global scale, the 2011 worldwide export market of refractory Ceramics (SITC
code 66232) is valued at approximately £2.4B, with £1.3B of the export value coming
from the European market3. The market in the United Kingdom exports about
£114.0M of refractory ceramics2
. On the reverse side, in 2011 the United Kingdom
market imported approximately £103.1M2
, showing a near balanced trade and a
stabilized market in the United Kingdom. This information provides an opportunity
and makes it a great market to enter into.
The most inspiring and opportunistic market statistic in 2011 is the 189% growth, in
refractory ceramics, over a two-year period for the top ten countries1,2
. This is shown
in Table 4-1. The opportunity in Italy and Finland shows a near 1,000% increase. This
supports the theory that the United Kingdom refractory market is a major emerging
player in the world market.
UNITED KINGDOME IMPORT EXPORT MARKET INCREASE FROM 2009
TO 2011
United Kingdom 2009 2011 % Inc.
Imports £61.8M £103.1M 67%
Exports £39.5M £114.1M 189%
Table 4-1
11. Page 11 of 67
Belgium
Italy
Poland
Ireland
Spain
France
Brazil
Finland
UnitedStates
SouthAfrica
2009
£0
£2,000
£4,000
£6,000
£8,000
£10,000
£12,000
(x1,000)
Top 10 Destination Countries from the U.K.
2009 2011
12. Page 12 of 67
MARKET CONTACTS
At the end of the day, business is often about relationships. Below is a list of
manufacturers and resellers that should be contacted as Doncasters investigates future
opportunities in the firebrick industry:
MANUFACTURERS:
Vitcas
8 Bonville Road
Brislington Bristol BS4 5NZ
United Kingdom
http://www.vitcas.com/
Tel: +44 (0)117 911 7895
Kilnlinings
53 Ennerdale close
Dronfield Derbyshire S18 8PL
www. kilnlinings.co.uk
Dyson TT
Baslow Road
Totley Sheffield S17 3BL
Tel: +44 (0)114 235 6060
Email: enq@dysontt.com
http://www.dysontt.com
DSF Refractories & Minerals Ltd.
Friden, Newhaven, Nr. Buxton,
Derbyshire, SK17 0DX
Tel: +44 (0)162 963 6271
Email info@dsf.co.uk
RESELLERS AND WHOLESALERS
Dudley Designs / Living Designs Co
uk Ltd
7 Campion Terrace
Leamington Spa CV32 4SU
+44 (0)778 465 0450
sales@dudleydesigns.co.uk
http://dudleydesigns.co.uk
Armstrong Brick Ovens
http://www.armstrongbrickovens.co.uk
+44 (0) 798 941 0528
Stove Spares
Capton Dartmouth Devon TQ6 0JE
Tel: +44 (0)844 332 0150
13. Page 13 of 67
FIREBRICKS
Firebricks are excellent for abrasive resistant floors and are found in pizza ovens and
kilns. The grading factor is based on the percentage of alumina that is in the brick (i.e.
GD 42 has 42% alumina).
Key Features
• Low iron content
• Low alkali content
• Resistance to thermal
shock
• Abrasion resistance
• High Density
• High Strength
Examples of Applications:
• Carbon bake furnaces in the aluminum industry
• Preheat zones and cyclones of rotary cement
kilns
• Primary reformers in fertilizer production
• Insulation for glass tanks
• Coke Ovens
• Blast Furnaces
• Reheating Furnaces
• Suspended roofs
• Lime Kilns
• Domestic fireplaces, barbeques and outdoor
ovens
BASIC RECTANGULAR FIREBRICKS RAGE FROM A RETAIL PRICE OF
£1 UP TO £37 DEPENDING ON SIZE:
42GD - 230 x 114 x 25mm 1.5kgs £1.00
42GD - 230 x 114 x 36mm 2.5kgs £1.25
42GD - 230 x 114 x 76mm 4.6kgs £1.29
42GD - 230 x 114 x 76/52mm
(arched)
4.6kgs £2.29
42GD - 300 x 114 x 76mm 5.7kgs £4.58
42GD - 610 x 300 x 76mm 35kgs £37.49
INSULATION BRICKS
Insulation bricks are lightweight and not very dense. This makes insulation bricks an
excellent solution for electric and gas kilns that have minimal abrasions. Insulation
bricks have a different grading scale than firebricks in that the grade is based on the
bricks maximum service temperature in degrees Fahrenheit (i.e. 26GD has a maximum
service temperature of 2600°F / 1430°C)
14. Page 14 of 67
Key Features4,5
• Low iron content
• Resistance to thermal
shock
• Low density
• Low heat storage
• High insulating properties
• Energy saving
Examples of Applications4,5
• Carbon bake furnaces in the aluminum
industry
• Preheat zones and cyclones of rotary cement
kilns
• Primary reformers in fertilizer production
• Insulation for glass tanks
• Coke Ovens
• Blast Furnaces
• Reheating Furnaces
• Suspended roofs
• Lime Kilns
• Domestic fireplaces, barbeques and outdoor
ovens
INSULATION BRICKS RANGE FROM A RETAIL PRICE OF £1 UP TO £37
DEPENDING ON SIZE: 4,5
26GD - 230 x 114 x 76mm 1.8kgs £2.25
28GD - 230 x 114 x 32mm 0.9kgs £1.90
28GD - 230 x 114 x 76/70mm 1.9kgs £2.99
28GD - 230 x 152 x 76mm 2.3kgs £10.17
28GD - 610 x 230 x 76mm 12.6kgs £33.33
PRODUCTION
For the production of firebricks and insulation bricks, a simple mold can be utilized.
For example, with the maximum mold size of 1,000mm by 600mm (assuming the
Cleveland 50 ton injection-molding machine), Doncasters Ceramics can produce
batches up to 152 bricks at a time. This is assumed by constructing a mold that allows
the brick shape to be vertical with a max height of 114mm. Larger bricks would
utilize a mold that positioned the brick(s) horizontally, with the shorter width vertical.
In the following table, a simplistic break-even is calculated by assuming production
costs are at 50% of retail sales and each mold is £10,000. This quick and simplistic
analysis shows that the firebrick size 42GD - 300 x 114 x 76mm is the most cost
effective brick to produce due to its break-even point at 78 batches or approximately
4,300 bricks sold.
15. Page 15 of 67
BREAK EVEN ANALYSIS PER PRODUCT WITH ASSUMPTIONS
Bricks
/
Mold *
Retail
/
Brick
Gross
Sales
/ Bach
Mold
Cost
Production
Costs
@ 50%
Net Sales
per Batch
Number
of Batches
to Break-
Even
Firebricks 42GD - 230 x 114 x 25mm 152 £1.00 £152.00 10,000£ £76.00 £76.00 132
Firebricks 42GD - 230 x 114 x 36mm 112 £1.25 £140.00 10,000£ £70.00 £70.00 143
Firebricks 42GD - 230 x 114 x 76mm 56 £1.29 £72.24 10,000£ £36.12 £36.12 277
Firebricks 42GD - 230 x 114 x 76/52mm (a) 56 £2.29 £128.24 10,000£ £64.12 £64.12 156
Firebricks 42GD - 300 x 114 x 76mm 56 £4.58 £256.48 10,000£ £128.24 £128.24 78
Firebricks 42GD - 610 x 300 x 76mm 1 £37.49 £37.49 10,000£ £18.75 £18.75 533
Insulation
Bricks 26GD - 230 x 114 x 76mm 56 £2.25 £126.00 10,000£ £63.00 £63.00 159
Insulation
Bricks 28GD - 230 x 114 x 32mm 120 £1.90 £228.00 10,000£ £114.00 £114.00 88
Insulation
Bricks 28GD - 230 x 114 x 76/70mm 56 £2.99 £167.44 10,000£ £83.72 £83.72 119
Insulation
Bricks 28GD - 230 x 152 x 76mm 12 £10.17 £122.04 10,000£ £61.02 £61.02 164
Insulation
Bricks 28GD - 610 x 230 x 76mm 2 £33.33 £66.66 10,000£ £33.33 £33.33 300
* Bricks Pressed Per Mold with 1,000mm X 600mm Mold with 6mm Separation
CONCLUSION
Considering the need for Doncasters Ceramics to find a product that can be
researched, designed, manufactured, and sold in a short period of time, firebricks and
insulation bricks should be considered as a short-term and sustainable opportunity that
can continue to grown into a long term opportunity. Further, alliances should be
considered with top manufacturers of refractory products in the United Kingdom to
develop product knowledge and to help overcome any barriers to the market.
Strategic alliances will aide Doncasters Ceramics when looking to take advantage of
the tremendous growth in exports from the United Kingdom in the worldwide
refractory brick markets.
FOOTNOTES
1. The 2009 Import and Export Market for Refractory Bricks - United
Kingdom.pdf
2. The 2011 Import and Export Market for Refractory Bricks - United
Kingdom.pdf
3. The 2011 Import and Export Market for Refractory Bricks in Europe.pdf
4. http://www.kilnlinings.co.uk
5. http://www.vitcas.com
6. Vitcas-Refractories-High-Temp-Insulations-Industrial-Catalogue.pdf
16. Page 16 of 67
4.2 CERAMIC CUTLERY
BACKGROUND
Ceramic knives exhibit significant benefits over conventional metal knives. The
primary benefit to a ceramic knife is blade sharpness. This sharpness is achieved
through superior density and strength as it is an extremely hard material – 8.5 on the
Mohs scale of mineral hardness second to diamonds at a 10 and much harder than steel
at a 61
. Ceramic knives hold their edge up to 15 times longer than a conventional
blade, and as a result, are the first choice for top sushi chefs, five-star restaurants, and
high-end consumers2
. Ceramics blades do not retain odors and are more sanitary than
metal knives due to the small pores, and weigh far less. With no metal, comes no rust3
.
17. Page 17 of 67
Source: http://kyoceraadvancedCeramics.com/Ceramics-advantage/kyocera-
technology
WHY CERAMIC KNIVES?
The ceramic knife sector is a fast growing segment of the cutlery industry and a very
niche part of the market - a great strategic fit with Doncasters Ceramics current
production capabilities which are very specialized, low volume, and high value add.
In 2011, the ceramic cutting tool market (knives, scissors, and peelers) was
approximately $1 billion and comprised only 8.5% of the global cutlery market - that
figure is expected to grow at 6.8% per year4
. Retail prices vary widely from £50 to
over £700+. Most multi-purpose ceramic chef knives average around £250 and high-
end ceramic sushi knives begin around £500, which is where Doncasters Ceramics
would focus. Doncasters Ceramics already possesses a great deal of the knowledge
and experience required to manufacture high-end Ceramics as an end product, despite
never having made that leap to a final product that is not a throw away piece during
production. Ceramic blade manufacturing is very similar to Doncasters Ceramics’
current processes with the primary difference being a slurry that is pelletized, similar
to plastic, which requires a different press to form a blank (ceramic knife shaped piece
of ceramic before and modifications). After the blank is formed, the process is almost
identical to the usual sintering and finishing of ceramic cores. The only additional
pieces of equipment necessary are specialized knife sharpeners with diamond grinding
wheels to provide a fine edge for the blanks.
From start to finish, Doncasters Ceramics could use current equipment with the
addition of a press and sharpener to form and sharpen a blank. Current employees,
who apply wax to cores, could sharpen the blades. This strategy seeks to reduce labor
costs and maintain current employment, which was a stated goal, and ultimately
provides new employment opportunities based on how quickly the business takes off.
To be successful and avoid large barriers to entry, Doncasters Ceramics could partner
with Kyocera (#1 manufacturer of ceramic blades) to be a supplier of sharpened
ceramic blanks. Since 1959, Kyocera advanced ceramic knives have been the
preferred choice for commercial and consumer ceramic knife applications5
. One out of
every five knives in Japan is a Kyocera ceramic knife and they have pioneered the
industry world-wide6
. Their reputation is unmatched by any of their competitors.
This partnership strategy eliminates the need for large capital investment in marketing
to establish market presence and a customer base. Kyocera would complete the knife
with a handle and sell it to the consumer, which avoids additional capital expenditure
for machines to press handles and labor to finish the knife. Partnerships are not
uncommon to the industry. Doncasters Ceramics also has the ability to approach the
18. Page 18 of 67
two other major ceramic knife producers - Asahi and Tivosan if Kyocera’s blank
pricing is not ideal, another element of the strategy is not acceptable, or if the timing is
not right for one of the companies. Additionally, many current producers of metal
knives are exploring ways to enter the ceramic knife industry, so there are multiple
partnership opportunities to produce ceramic blades with a Kyocera partnership just as
a preferred first option. Estimated costs and explanation of financial
assumptions/considerations are included below.
Note that a base case of a 10,000 annual blank production run is favorable based on
Net Present Value (NPV) and discounted payback period over five years. A higher
volume production run of 15,000 blanks is provided as well - margins expand
accordingly and are based on EBITDA cash flows listed on each spreadsheet. These
numbers are based on estimated blank contract numbers and margins are based on the
agreement between companies. A cost of £14 is one of the lower prices Doncasters
Ceramics could accept and maintain a positive NPV with current financial
assumptions. The spreadsheets used to calculate these estimates are included in order
to provide value for future projections/modifications and help drive future decision
making for this product option. Simply adjust expense areas to change cash flows and
new considerations can be weighed and evaluated on an NPV basis.
19. Page 19 of 67
Toshitami Kadotais is the head of sales for Kyocera Europe and is the main point of
contact to get started. He was very willing to provide information and his insight was
critical for background on Kyocera ceramic knives, the market, and possible
partnerships. His contact information is provided below.
HEAD OF KYOCERA EUROPEAN
SALES
Toshitami Kadota
KYOCERA Fine Ceramics GmbH
Fritz-Mueller-Strasse 27
D-73730 Esslingen / Germany
Phone: +49 (0)711 9393 4978
Fax: +49 (0)711 9393 4950
Mobile : +49 (0)151-4263-6241
Email : toshitami.kadota@kyocera.de
www.cookingwithCeramics.com
Kyocera US Representative
Tadaaki Sakai
Kyocera Tycom Corporation
3565 Cadillac Avenue
Costa Mesa, CA 92626 / USA
www.kyoceraadvancedCeramics.com
KYOCERA UK OFFICE
Kyocera Fine Ceramics Ltd.
Prospect House
Archipelago
Lyon Way
Frimley
Surrey
GU16 7ER
Phone: 44-1276-69-3450
Fax: 44-1276-69-3460
Email: sales.uk@kyocera.de
PRIMARY KYOCERA UK
DISTRIBUTOR
Dexam International Ltd
Holmbush Way, Midhurst
West Sussex, GU29 9HE
UK
Tel: +44 (0)1730 811811 (sales office)
Fax: +44 (0)173s0 811899
INDUSTRIES
A very important secondary component to the strategy is to work with the Cutlery
Allied Trades Research Association (CATRA), which is a global cutlery industry
leader and research organization. CATRA specializes in special purpose machine
development, cutlery manufacturing processes, safety processes, and engineering
support from start to finish on all types of cutlery. It is headquartered in the UK
(contact information below) and CATRA could provide critical advice and support if
Doncasters Ceramics decides to begin manufacturing ceramic blades. The two
gentlemen below helped establish the sharpening machine requirements necessary for
ceramic blades. Roger Hamby is the point of contact for machine modification and can
provide advice on any further requirements. Mr. Hamby also provided most pricing
and brochures for each machine in addition to the £100/hr consultancy rates.
20. Page 20 of 67
CATRAADDRESS
Henry Street,
Sheffield
S3 7EQ,
United Kingdom
Telephone: +44 (0)114 276 9736
Fax: +44 (0)114 272 2151
E-Mail: info@catra.org
MAIN CONTACTS
Roger C. Hamby
Director of Research
Tel +44(0)1142769736
Email: hamby@catra.org
Michael J. Zurek
Manufacturing Manager
Tel +44(0)114 2769736
Fax +44(0)114 2722151
Email: michael@catra.org
PLANNING/FINANCIAL CONSIDERATIONS
Sharpeners - There are two options available to sharpen ceramic knives from CATRA.
The I100 is an industrial sharpener and can be modified with liquid cooled diamond
grinding wheels for a high volume option. The I100 does not usually come in this
format, so CATRA would have to develop this version at a cost of £9000. Subsequent
models would be cheaper. Grinding wheels last approximately 5000- 20,000
sharpenings based on blade angle/ceramic density. The CATRA Sharp is a lower
volume model and costs £869 per unit. The grinding wheels on the CATRA Sharp last
between 4,000 – 8,000 sharpenings and cost approximately £135 for replacement
diamond grinding wheels. The wheels need to be replaced per the scheduled basis to
avoid damage to blanks. Sharpener brochures and points of contact are listed and
included in the appendix. The higher volume I100 with a CATRA Sharp back up is
used in the financial models.
Press – The ceramic knife production cycle requires a press capable of 12,900 PSI or 1
ton per square centimeter. Three options exist to fill this need – a leased press, a used
press, and a new press. The leased option costs ~£6000 per month and this includes
installation (varies per supplier). A used press costs ~£50,000 and may include
installation based on the contract. A new press costs ~£120,000 and likely includes
installation for some UK suppliers contacted. Based on the cost and new entry to
market, a leased or used press is the recommended option. A new press may be
considered in the future as business dictates. A new press is a requirement for other
recommended products and Doncasters Ceramics may be able to realize synergies
between business opportunities as a result. It is important to note that quotes and
estimates for the press are based on general requirements and vary widely. Each press
supplier requires specific information on dimensions of the building, material, and
mold to give exact pricing. There are many options to choose from and the base case
21. Page 21 of 67
for the financial models is the used press. Martin Hodson at Global Industry Services
seemed to have the most favorable pricing and was able to do a great deal of
modification with press size, heat if necessary, and automation if required. Although
his presses may be a little smaller than comparable models at other suppliers, the best
option is to contact him first and then reach out to other suppliers. Contacts below:
Graham Fullard
Press Sales International Ltd
Tel: 0044 (0) 1902 604 822
Fax: 0044 (0) 1902 608 985
Email:
sales@presssalesinternational.co.uk
Web: www.press-sales-
international.co.uk
Martin Hodson
Global Industrial Services
Unit 7, Papermill Industrial Estate
Great BARR, Birmingham, B44 8NH
Email martinHodson2@hotmail.com
Worcester Presses Ltd
Telephone +44 (0)1384 392266
FAX +44 (0)1384 374261Worcester
Presses Ltd Titan Works,
Stourbridge, West Midlands, DY8 4LR,
UK.
General Information:
sales@worcesterpresses.co.uk
Service: service@worcesterpresses.co.uk
Press Shipping/Install – Shipping and installation can be negotiated in the lease and
new options. The used press may come with installation costs of £5000 - £10,000.
£10,000 was used as a conservative planning figure in the financial models. Again, it
is important to verify theses costs because the press suppliers need detailed
information to finalize pricing and may are willing to negotiate on large presses that
have been harder to sell. Note that Global Industrial Services had the best pricing in
this category as well.
Mold – A new mold will be required to withstand the higher pressure needed to make
a ceramic blade and the mold will need to be created to form a blank for the knives in
production. £40,000 was used as a planning figure based on mold simplicity and
feedback during the initial visit. This mold could be produced in-house if possible or
outsourced to the current toolmaker. Each option would impact price accordingly.
22. Page 22 of 67
CATRA Training – As noted, CATRA is an industry leader and research
organization viewed as an authority in the cutlery industry. As such, it would be
beneficial to receive training or advice each year to ensure operations were up-to-date
and using best practices that evolve throughout the industry. Their consulting fee is
£100/hr, and it is not limited to training. CATRA can provide advice on processes,
procedures, and assist with operational issues or machine engineering. CATRA can
help Doncasters Ceramics overcome lack of experience and move into the market
quickly. Training related to the sharpening machines is free with the purchase of each
machine. This expense can be removed, but their assistance is highly recommended to
help avoid costly mistakes. Note a full 4 weeks of consulting is planned for year one in
both financial models to account for start-up challenges. Two weeks are included in
years two through five.
Sharpener maintenance – These estimates are based on grinding wheel replacements
per CATRA schedules to maintain safety and sharpness standards. The estimates are
on the very high end to account for large volume increases if they occur. Actual costs
will likely be lower, especially if the CATRA Sharp option is used with grinding
wheels at £135 each, which only call for replacement at the earlier after 4,000
sharpenings. Warranty covers the majority of other parts on the machines.
Press maintenance – This figure is based on general estimates from press suppliers
and can vary based on usage and conditions. Most suppliers offer preventative
maintenance packages at relatively low cost when the press is purchased.
Labor – Based on the lower volume estimate of 10,000 blanks (10,000/210 days =
47.6 knives/day), one person can handle the volume with the added benefit of keeping
workers busy when regular core production is slow. 50% higher costs are added for
the 15,000 blank production run. £20,000 annual labor costs were used per direction
from Doncasters Ceramics.
Utilities – £50,000 per year was used per direction from Doncasters Ceramics.
Shipping – Estimated cost to ship blanks to Ceramics knife finishing facility.
Slurry Mix – Feedback from the initial meeting listed slurry mix costs as negligible.
The new mix can be provided by the current supplier or in partnership with Kyocera.
The costs are still very low and will vary based on partnerships. £3,000 was used as a
planning figure to be conservative and account for this expense. Lower costs fall to
the bottom line.
Safety - £10,000 per year was used per direction from Doncasters Ceramics.
23. Page 23 of 67
Assumptions – All assumptions are conservative and based on the high end of each
cost area. Profitability is likely higher due to actual costs in many categories that may
turn out to be lower than plan, but the reverse may occur if an undiscovered problem
arises. More favorable contracts impact NPV very quickly in a positive direction. In
the base case of an annual 10,000 blank production run at £14 per blank, NPV is
£24,985.76 with a discounted payback period of 3.93 years at a 10% cost of capital.
Due to similar costs at lower production, an annual 15,000 blank production run at £14
per blank causes NPV to jump to £227,034.69 with a discounted payback period of
1.46 years at a 10% cost of capital. The 15,000-volume option clearly is more
attractive and still fits with Doncasters Ceramics’ manufacturing capabilities, which
are high quality and low market volume. These models provide a starting point for
Doncasters Ceramics to evaluate entry into the ceramic knife market and a tool to
reference when exploring contract options/viability.
24. Page 24 of 67
Proj
CCF
DCF
CDCF
10%
A.
B.
C. NPV =
D. IRR =
E. MIRR =
F. PI =
£24,986
3.9337
-£23,915 £1,699
Five Year
5
£37,503
£69,606
£23,286
-£5,399 £32,103
£28,175 £25,614
0
14.60%
£0.23
£24,985.76
18.23%
Payback Period =
Discounted Payback Period =
3.1440
-£109,900 -£83,082 -£52,090
Project cost of capital = r = WACC =
-£109,900 -£80,400 -£42,900
-£109,900 £26,818 £30,992
1 2 3 4
-£109,900 £29,500 £37,500 £37,501 £37,502
Cash flows 10K Blanks
Capital Expenses Year 1 Year 2 Year 3 Year 4 Year 5
Sharpener ‐£9,900.00
Press ‐£50,000.00
Press Shipping/Install ‐£10,000.00
Mold ‐£40,000.00
CAPEX Total ‐£109,900.00
Annual Expenses
CATRA Training £800/day ‐£16,000.00 ‐£8,000.00 ‐£8,000.00 ‐£8,000.00 ‐£8,000.00
Sharpener Maintenance ‐£1,000.00 ‐£1,000.00 ‐£1,000.00 ‐£1,000.00 ‐£1,000.00
Press Maintenance ‐£7,500.00 ‐£7,500.00 ‐£7,500.00 ‐£7,500.00 ‐£7,500.00
Labor Annual 20K ‐£20,000.00 ‐£20,000.00 ‐£20,000.00 ‐£20,000.00 ‐£20,000.00
Utilities ‐£50,000.00 ‐£50,000.00 ‐£50,000.00 ‐£50,000.00 ‐£50,000.00
Shipping ‐£3,000.00 ‐£3,000.00 ‐£3,000.00 ‐£3,000.00 ‐£3,000.00
Slurry ‐£3,000.00 ‐£3,000.00 ‐£3,000.00 ‐£3,000.00 ‐£3,000.00
Gloves, Safety Equip, etc. ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00
Total Cost ‐£109,900.00 ‐£110,500.00 ‐£102,500.00 ‐£102,500.00 ‐£102,500.00 ‐£102,500.00
Blanks 10000 @ £14 £140,000.00 £140,000.00 £140,000.00 £140,000.00 £140,000.00
Total Profit (EBITDA Cash flow) £29,500.00 £37,500.00 £37,500.00 £37,500.00 £37,500.00
Gross Margin 21.1% 26.8% 26.8% 26.8% 26.8%
25. Page 25 of 67
Cash flows 15K Blanks
Capital Expenses Year 1 Year 2 Year 3 Year 4 Year 5
Sharpener ‐£9,900.00
Press ‐£50,000.00
Press Shipping/Install ‐£10,000.00
Mold ‐£40,000.00
CAPEX Total ‐£109,900.00
Annual Expenses
CATRA Training £800/day ‐£16,000.00 ‐£8,000.00 ‐£8,000.00 ‐£8,000.00 ‐£8,000.00
Sharpener Maintenance ‐£1,200.00 ‐£1,200.00 ‐£1,200.00 ‐£1,200.00 ‐£1,200.00
Press Maintenance ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00
Labor Annual at 20K ‐£30,000.00 ‐£30,000.00 ‐£30,000.00 ‐£30,000.00 ‐£30,000.00
Utilities ‐ Electricity ‐£50,000.00 ‐£50,000.00 ‐£50,000.00 ‐£50,000.00 ‐£50,000.00
Shipping ‐£6,000.00 ‐£6,000.00 ‐£6,000.00 ‐£6,000.00 ‐£6,000.00
Slurry ‐£4,000.00 ‐£4,000.00 ‐£4,000.00 ‐£4,000.00 ‐£4,000.00
Gloves, Safety Equip, etc. ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00 ‐£10,000.00
Total Cost ‐£109,900.00 ‐£127,200.00 ‐£119,200.00 ‐£119,200.00 ‐£119,200.00 ‐£119,200.00
Blanks 15000 @ £14 £210,000.00 £210,000.00 £210,000.00 £210,000.00 £210,000.00
Total Profit (EBITDA Cash flow) £82,800.00 £90,800.00 £90,800.00 £90,800.00 £90,800.00
Gross Margin 39.4% 43.2% 43.2% 43.2% 43.2%
Proj
CCF
DCF
CDCF
10%
A.
B.
C. NPV =
D. IRR =
E. MIRR =
F. PI =
£227,035
1.4614
£108,634 £170,653
Five Year
5
£90,803
£336,106
£56,382
£154,501 £245,303
£68,220 £62,019
0
37.63%
£2.07
£227,034.69
74.39%
Payback Period =
Discounted Payback Period =
1.2985
-£109,900 -£34,627 £40,414
Project cost of capital = r = WACC =
-£109,900 -£27,100 £63,700
-£109,900 £75,273 £75,041
1 2 3 4
-£109,900 £82,800 £90,800 £90,801 £90,802
26. Page 26 of 67
HOW TO MAKE A FINE CERAMIC KNIFE
Water, raw powder and ceramic milling balls are fed into a mixer-
like device called a mill.
To create particles of uniform size, with diameters of
approximately one micrometer (1 µm or 0.001 mm), raw
materials are first mixed into a slurry (a fluid of water and
ceramic powder in which the particles are blended).
A spray dryer dehydrates the raw materials in the slurry to make a
granulated powder.
The granulated powder is used to fill a knife-shaped mold.
The mold is placed under high pressure — 1 ton per cm2
(approx.
12,900 psi) — to solidify the powder into the desired shape.
27. Page 27 of 67
The material is then fired and sintered in a kiln, like conventional
ceramics, but under precisely controlled temperatures.
During the firing process, the ceramics blade shrinks to 75
percent of its original, unfired size, while the volume shrinks by
nearly half. These shrinkage rates are carefully calculated during
the design process, so the finished size matches the design
specifications.
The blade is then ground with a diamond wheel to produce a
razor-sharp edge.
A handle is then attached to complete
the process.
SECOND PHASE:
An exciting relatively new segment of the ceramic cutlery market is ceramic scissors
and shears. They maintain similar benefits over conventional metal shears as cutlery.
Expansion into this market would require minimal investment after Doncasters made
the decision to manufacture ceramic knives. The strategy would be the same – partner
with Kyocera to keep capital investment low and provide sharpened blanks that
Kyocera would finish with a handle and take to market. Additional investment by
Doncasters would be limited to a new mold for scissor and shear blades. Obviously, if
the business grew quickly, press capacity will become a consideration, and Doncasters
28. Page 28 of 67
can make the decision to invest in additional press capacity based on the economics of
the decision.
High-end stylist shears are currently constructed of metal and no company has entered
the market with a ceramic option. The capabilities of ceramic blades could bring a
great deal of value to this market. Stylist shears retail for £800 - £3000+. This is
certainly a more pie in the sky option if ceramic knives and scissors prove to be viable
options for Doncasters, but it presents some real opportunities that do not exist in the
market today.
SWOT ANALYSIS
Strength – The ceramic knife market is growing steadily at over 6% and popularity is
growing as consumers are exposed to the benefits. The knives are far superior to
conventional knives in terms of their ability to hold a fine edge, maintain sanitary
conditions, and repel odors and avoid food/flavor contamination, which is a significant
consideration at very high-end restaurants. On the production side, there are large
barriers to entry (high capital expense and specialized knowledge) as most consumers
want the knife and company with the best reputation. Kyocera clearly wins in this
category and is why Doncasters should partner with them to capitalize on their market
position and enter the market quickly without a great amount of capital investment.
Weakness – As mentioned concerns are consumer exposure to the benefits of ceramic
knives. Market slow down and recessions are a consideration, as consumers will spend
less on higher end cutlery and high-end restaurants that use ceramic knives. The
industry still needs to invest in targeted advertisement to grow the market and help
consumers understand why the additional expense is justified.
Opportunities – The greatest weakness of ceramic knives listed above is also one of
the greatest opportunities. As companies get the message to consumers about ceramic
knife benefits, the market has the ability to take off rapidly. New research can lead to
better ceramic slurries, which resist breaking and chipping after it is sintered. This
would help overcome the major drawback of ceramic knives, which is durability if
dropped or impacted laterally.
Threats - Asahi and Tivosan are the two main competitors of Kyocera and any joint
collaboration or a merger could threaten Kyocera’s market share if they gain better
research abilities and a larger marketing budget that leads to greater market share.
Market slowdowns and recessions.
30. Page 30 of 67
5.0 MID-TERM OPPORTUNITIES
The team has identified ceramic brakes as an excellent fit and opportunity for
Doncasters Ceramics. Ceramic brakes are becoming increasingly popular in the
marketplace. They are desirable in the Formula 1 racing circuit and preferred by high-
end luxury vehicle consumers. Manufacturing ceramic brakes presents any
opportunity for high margins and growth. Doncasters Ceramics has an opportunity to
enter the marketplace at minimal risk, utilizing a partnership with Doncasters existing
automotive division. The team feels this is a mid-term opportunity because the initial
investment is roughly £150,000 and may take three to five years to fully implement
and produce desired profits.
31. Page 31 of 67
5.1 CERAMICS BRAKES
BACKGROUND
Ceramic carbon brakes are the brakes to bring
prestige to any luxury vehicle owner. Ceramic
carbon brakes are used in F1 racing as well as in
high-end luxury vehicles, such as Porsche and
Ferrari. These high-end ceramic brakes are
known for their durability, excellent stopping
ability, light weight capability, and the fact that
they create virtually no brake dust. Ceramic
carbon brakes can also withstand much greater temperatures due to their
manufacturing process, which coupled with their other attributes, make them ideal for
Formula 1 racing.
Ceramic carbon brakes are increasing in popularity amongst luxury vehicle owners,
especially for those individuals who are involved in racing clubs. Due to the high
purchase price of these brakes they are often times a prestigious after market add on
that luxury vehicle owners opt for. These brakes are chosen not only for their quality
but also for bragging rights in car clubs. Due to their popularity, more and more
luxury vehicle brands are starting to put ceramic carbon brakes on their cars as a
factory standard.
THE MARKET
The ceramic brake market is a billion dollar industry. This industry is a high margin
industry that includes Formula 1 racing and luxury vehicle makers. Ceramic brakes are
popular amongst consumers who own cars such as Bugatti, McLaren, Bentley, etc.
This demographic is prepared to spare no expense when it comes to having top of the
line, high performance everything on their vehicles. They are unaffected by the higher
price of ceramic brakes. Ceramic carbon brakes are considered the future of braking
systems in the automotive world. They are currently highly specialized, high-end car
components that have a starting retail price of
approximately ₤7,000 and runs upwards of
₤20,000-₤40,000. Because this type of brake is so
specialized, carbon ceramics brakes are not a mass
production market. Ceramics brakes fit nicely into
a high quality, low production, and niche market.
However, there are discussions that carbon
Ceramics brakes will eventually become standard
32. Page 32 of 67
on all vehicles, allowing Doncasters, the option to grow production with the mass
market, should they choose. In the future, another possible business venture would be
in the aerospace industry. Doncasters is currently active in this market segment and
could produce ceramic carbon brakes for the aerospace industry.
33. Page 33 of 67
SWOT ANALYSIS
Strengths
• Already a provider of
specialized auto parts
• Employee auto part engineers
and/or research department
• Have a marketing team in place
for automotive
• Have existing relationships with
auto manufacturers such as Rolls
Royce
Weaknesses
• Lacking in manufacturing
equipment
• Will require capital investment
• Requires new “recipe”
• This particular facility does not
manufacture auto parts
Opportunities
• New technology
• High end with very few
manufacturers
• Billion dollar industry
• Local high end car
manufacturers
• i.e. Rolls Royce, Jaguar, Range
Rover
Threats
• Brembo – current well known
brake manufacturer is already in
the market
• This would be a new product
entry
• Accreditations Required: VDA
6.1 and ISO 9001:200
WHY CONSIDER MANUFACTURING?
Why should Doncasters consider entering
the market of carbon ceramic brakes? It’s
simple; they already have a large and
successful automotive sector that
manufactures other brake components.
This means that they already have the R &
D team in place as well as the marketing team. In addition, relationships with top car
manufacturers have already been created so the team and relationships are in place.
Doncasters currently produces braking components for the automotive sector, which
requires specific certifications, the same certifications that would be required to
produce actual brakes. They have the in-house certifications and knowledge of what
is required for manufacturing of braking components thus, another hurdle that has
been cleared. The production of ceramic carbon brakes would not only continue to
keep the ceramic branch of Doncasters vertically aligned with Doncasters as a whole,
34. Page 34 of 67
but it can now become more than just a step in production. Doncasters Ceramics can
become a revenue center.
PRODUCTION PROCESS
Part of the reason that ceramic carbon brakes are a high retail value, other than their
superior characteristics, is because of the production process. Production of these
brakes requires a longer process and is highly specialized. The secret of the
advantages of the ceramic carbon brake disk, is the unique production process, lasting
over approximately 20 days. To produce ceramic carbon brake disks, carbon fibers are
given a special protective coating, and then cut into short fiber sections of defined
thickness and length. The production process has several stages; preparation of the
fiber mixture, production process for the disk body, production process for the bell
mounting, and the final machining of the assembled brake disk.
The entire production process is monitored with various tests and ends with one final
testing. The production process of the ceramic brake body continues with a pre-form
pressed with binding resin to a so called green body which will be converted in the
ceramic component by carbonizing at 900 °C and siliconizing at 1700 °C in a high
vacuum. The complex feature of the manufacturing process is the use of the “lost
core” technology – a plastics matrix which defines the design of the cooling vane
geometry and which burns out without residues at carbonizing – as well as the
different fiber components of the brake disk body, the friction layers on the ring
exterior side, and the point-shaped abrasion indicators, which are, integrated into the
friction layer. This process requires time but it is necessary to develop a product that
can withstand the heat and wear of high usage requirements. This production process
is specialized and time consuming, but in order to manufacture carbon ceramic brakes
that are able to withstand the heat as well as heavy wear they must go through this
process. Other ceramic products that are not produced this way are brittle and fragile,
which is not acceptable in the industry of automotive brake systems.
CONCLUSION
Ceramic brakes are an excellent mid-term solution for Doncasters Ceramics. This
particular product falls in line with what is already being produced in the Doncasters
family and will fit the larger picture of being vertically aligned with the other sectors
of Doncasters. The production of ceramic carbon brakes would not only be a
prestigious addition to Doncasters’ automotive offerings, but will also turn the
ceramics branch into a profit center. This will produce more jobs along with more
revenue while staying within Doncasters’ main product lines. This is a great
opportunity, as Doncasters Ceramics would not need to do heavy research since the
Doncasters family already produces high-end brakes for the automotive market. This
35. Page 35 of 67
opportunity also opens the door to possible ceramic carbon brake productions for the
aerospace industry, in which Doncasters is already participating. Ceramic brakes offer
Doncasters Ceramics an opportunity for growth, utilizing the relationships Doncasters
currently has.
36. Page 36 of 67
PLANNING/FINANCIAL CONSIDERATIONS
Approximate Costs
The capital cost to produce ceramic brakes can range from several thousand pounds to
over one-million pounds depending on the integration with Doncasters’ automotive
division in regards to facilities, staffing, and machine reuse (i.e. a new custom built
HIPing machine is estimated at ₤1,200,000).
₤ 18-20 per kilo for carbon fiber strands
CONTACTS FOR PURCHASE OF HIPS
Avure Technology
Avure Technologies Service &
Sales - Africa, Asia & Europe
Office - Quintusvägen 2,
Bldg.343 Workshop-
Terminalvägen 22,
B340 SE 721 66
Västerãs Sweden
Tel: +46 (0)21 327000
Service Line: +46 70 412 7070
8.00-17.00 Central European
Time
Fax: +46 (0)21 141817
EPSI NV
Walgoedstraat, 19
B-9140 Belgium
Tel: +32 (0) 3 722 24 64
Fax: +32 (0) 3 722 18 70
Email: epsi@epsi.be
Luc Colman – Sales Manager
Peter Van Roey – International Sales
Manager
Pierre Colman – Vice President
AIP Technology
Valley Research Iberica
Dr. Pablo Garcia
Gregoria Donas 23
28017 Madrid Spain
616-100-715 (ph)
91-377-5432
pablo@valleyresearch.com
37. Page 37 of 67
FOOT NOTES
1. http://www.sglgroup.com/cms/international/products/product-
groups/bd/carbon-ceramic-brake-disks/index.html?__locale=en
2. http://www.sglgroup.com/cms/international/products/product-
groups/bd/carbon-ceramic-brake-disks/index.html?__locale=en
3. http://www.carbonceramicbrakes.com/ENG/ProductionProcess/
ADDITIONAL IMAGES
YouTube “How they are made”
http://www.youtube.com/watch?v=Q_3PebbkGpo&feature=endscreen&NR=1
HIPing Machine
38. Page 38 of 67
6.0 LONG-TERM OPPORTUNITIES
As mentioned earlier, ceramics has a very opportunistic future due to technology and
the demand for sustainable, “green” products. New opportunities for ceramics are
occurring everyday. This fact presents Doncasters Ceramics with the opportunity to
become involved in sustainable business segments by looking at ceramics as an end
product. In this section we will particularly look at the future of ceramic filter
production for water features on golf courses.
39. Page 39 of 67
6.1 CERAMIC WATER FILTERS
BACKGROUND
The world is changing and knowledge is becoming more and more powerful. We are
citizens of the world who are looking for ways to make the world a better place for our
fellow citizens. This has led to new research in the use of ceramic filters for water
purification. Research into the use of ceramic water filters is increasing and third
world nations are seeing many benefits from their use. Countries without the
infrastructure for clean water are finding that use of small porous ceramic material can
filter out dirt, debris, and bacteria.
As research continues, they are finding that the additional of silver to the ceramic will
also to aide in the killing of bacteria and prevent growth of mold or algae on the filter
itself. The addition of active carbon is also found to remove elements such as chlorine.
Filters with active carbon typically need to be replaced more often because the carbon
can become clogged with foreign material. A new opportunity to solve this may be to
incorporate a high-performance activated carbon core inside the ceramic filter
cartridge that reduces organic and metallic contaminants. Filters are cleaned by
brushing and rinsing or, if needed, hot water and soap. As is typical in any ceramic
filter, the risk can always be a hairline crack, which allows contaminants through.
Many government agencies and aid organizations are backing the research and
implementation of ceramic water filters in third world countries. Currently, you can go
on eBay and purchase a ceramic water filter or small system for $5 US to $1,000 US,
but all are small and mostly made in countries where labor is cheap and small
components are mass produced. At this time, all efforts toward the use of ceramic
water filters have been focused on drinking water and small components. This
provides an opportunity to think outside of the box and look at other areas where large
ceramic filters can be implemented to help the environment and living organisms.
WHY CERAMIC WATER FILTERS?
Currently, small, portable ceramic filters are the most common solutions in the
marketplace. This leaves an opportunity for producing larger, filters for industry, non-
personal use. This solution is located in long-term opportunities for Doncasters
Ceramics, because research and development is required. From research, people have
yet to think about utilizing ceramic filters in a larger capacity. Doncasters Ceramics
can develop the product themselves and hold a patented on it or even team up with an
inventor or engineer that can help bring the idea to fruition. In later sections, it is
40. Page 40 of 67
propose that Doncasters Ceramics hold business plan competitions amongst university
students, industry groups, and/or small business associations.
Doncasters Ceramics has a niche opportunity in the golf industry. There are many
articles about the problems and upkeep expense of golf course water features, yet no
one has come up with a viable, “green” solution to maintenance. We all enjoy the
beautiful water features on a golf course and most of us enjoy the living things they
attract. The problem is that these water features can also be a breeding ground for
bacteria and unsanitary conditions. Currently, many golf courses are using chemicals,
which are not healthy for the environment or the creatures living in, or around these
water features. As the opinion of the world shifts, to seek ways to live a healthier,
chemical-free lifestyle, society has an increasing expectation that businesses are held
accountable for their damage to the environment. Ceramic filtration systems on golf
courses have an opportunity to fulfill the new sustainable “green” requirements and
customer expectations.
PLANNING/FINANCIAL CONSIDERATIONS
This opportunity is so new and untapped; there have yet to be financial numbers
released. However, if we look at the golf industry specifically, many golf courses
expect to spend millions per year on golf course upkeep.
2012 Industry Survey completed by 750 golf course superintendents for GCI (Golf
Course Industry).
41. Page 41 of 67
POSSIBLE CERAMIC FILTER PARTNERSHIPS:
• Fairey Industrial Ceramics Limited (FICL)
• Currently produce ceramic water filters and systems sold throughout the world.
• Brands include, Doulton, British Berkefeld and Fairey.
• They consider themselves the “Global Leader in Water Purification?
Lymedale Cross
Lower Milehouse Lane, Newcastle-under-
Lyme
United Kingdom, ST5 9BT
Tel:+44 (0)1782 664420
filtersales@faireyceramics.com
http://www.faireyceramics.com/
Tekleen Automatic Filters
2672 S. La Cienega Blvd.
(800) 336-1942
(310) 839-2828
Fax: (310) 839-6878
info@tekleen.com
Mantec Technical Ceramics – Ceramic
Filter Div.
Mantec Technical Ceramics Ltd
Normacot Road, Longton, Stoke0on-Trent
ST3 1PA, England
Tel: +44 (0)1782 377550
http://www.mantectechnicalceramics.com
Produces various filters for the chemical,
42. Page 42 of 67
petrochemical, casting and
general process industries.
POSSIBLE WATER FEATURES FOR GOLF COURSES PARTNERSHIPS:
Aquatico Aquatic Management
77 Old Wortley Road, Kimberworth, Rotherham, S61 1NQ
Telephone: 07891 593870
E-mail: roanfish@blueyonder.co.uk
Website: http://www.aquatico.co.uk/
SWOT ANALYSIS
Strengths
• Doncasters Ceramics already
uses a type of ceramic filter
• Sustainable for the future
• Fits into future “green”
compliances
• Doncasters Ceramics is located
in the region of the world where
golf was born
Weaknesses
• Limited available knowledge of
this type of product
• R&D required to bring the final
product to fruition
• Doncasters is not currently in the
golf or water filtration industry
Opportunities
• No current competition in the
market place
• Keeps Doncasters Ceramics
ahead of the game
• Excellent PR and marketing
opportunity for free press
• Puts Doncasters Ceramics at
the forefront of innovation
Threats
• Current producers of ceramic
filters decide to hit this niche
first
• Product made in nations with
cheaper labor
• Other, less expensive, “green”,
options are discovered
43. Page 43 of 67
CONCLUSION
Ceramic Filters in the golf course industry may allow Doncasters Ceramics to fulfill a
need in a niche market. The golf industry is prepared to spend money to keep their
grounds and water features looking their best. The world is turning to technology to
fulfill a demand for fewer chemicals in our environment and more sustainable living.
Ceramic water filters provide a “green” option for golf courses and will meet the
needs of possible future environmental regulations. This is a long-term opportunity for
Doncasters Ceramics because of the research and development that this undertaking
will require. However, this can be sped up with minimal investment via industry
partnerships and business plan competitions for inventors or engineers.
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7.0 OTHER OPPORTUNITIES
The team also came up with the various ideas listed below. After speaking with Mark,
Jobe, and Amo, the ideas were deemed not feasible at this time, but are ideas to
consider in the future are as the basis for other opportunities for Doncasters Ceramics.
SHORT-TERM
• Kiln Furniture
• Ceramic Cook Tops
MID-TERM
• Golf Club heads and putters
o Ceramics have been attractive materials for golf clubs because of their
hardness, wear resistance and lightweight capabilities.
• Ceramics in electronic components
o Ceramics’ wide range of electrical properties including insulating,
semi-conducting, superconducting, piezoelectric and magnetic are
critical to products such as cell phones, computers, television, and other
consumer electronic products. The global market for electronic
ceramics is estimated at around $9 billion.
o Mobile Phone antennas
Sarantel’s PowerHelix range uses a patented design in which
copper tracks, deposited onto a small ceramic cylinder, are
individually and automatically laser trimmed for optimum
frequency response
laser trimmed for optimum frequency response
• Ceramic Cook Tops
o Ceramic cook tops are very expensive high end cook tops. They are
becoming more popular due to their consistent heat as well as their
durability. Many restaurants and higher end homes are beginning to
install these.
• Ceramic Furnace Filters
o In glass manufacturing, low-density ceramic filters are used for
controlling furnace emissions.
LONG-TERM
• Thermal Barrier Coating/Plasma
• Medical
• Renewable Energy
o Silicon wafer based photovoltaic cells
Ceramic materials help manufacturers of thin film photovoltaic
cells achieve greater efficiency
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o Thin film deposition photovoltaic cells
Deposition materials: ceramic crucibles and boats are used to
hold materials to be deposited, as they are dimensionally stable
and do not react with the molten material
o Solar Thermal Energy
Ceramics are used to provide the crucial high temperature
materials, which line the chamber where the sun’s rays are
focused, and to provide protection and insulation in various
parts of the solar tower system.
o Ceramic Bearings in Wind Turbines
o Micro Wind or gas Turbines for residential, commercial or automotive
o Ceramic connectors for attaching renewable energy generators to the
grid
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8.0 ADDITIONAL RECOMMENDATIONS
• Tradeshows
• Industry Support & Networking Groups
• Employee Incubator
• Business Plan Competition
TRADESHOWS
Name: ACerS Electronics and Basic Science division – Electronic Materials and
Applications
Typical time of year: January
What: Focuses on electronic materials for energy generation, conversion and storage
applications
Website for registration: http://ceramics.org/meetings/electronic-materials-and-
applications-2013
Name: International Congress on Ceramics
Typical time of year: July
What: Annual global event produced by the International Ceramic Federation and
American Ceramic Federation focused on themes such as environment, energy,
infrastructure, aerospace, devices and many others.
Website for registration: http://www.ceramicindustry.com/events/637-international-
congress-on-ceramics-
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Name: International Conference and Exposition on Advanced Ceramics and
Composites
Typical time of year: January
What: International Conference and Exposition on Advanced Ceramics and
Composites showcases cutting-edge research and product developments in advanced
ceramics, armor ceramics, solid oxide fuel cells, ceramic coatings, bioceramics and
more.
Website for registration: http://ceramics.org/meetings/37th-international-conference-
and-expo-on-advanced-ceramics-and-composites
Name: CICMT – Ceramic Interconnect and Ceramic Microsystems Technologies
Typical time of year: April
What: The Ceramic Interconnect and Ceramic Microsystems Technologies (CICMT)
conference brings together a diverse set of disciplines to share experiences and
promote opportunities to accelerate research, development and application of ceramic
interconnect and ceramic microsystems technologies.
Website for registration: http://www.imaps.org/ceramics/index.htm
Name: CMCEE International Symposium on Ceramic Materials and Components for
Energy and Environmental Applications
Typical time of year: May
What: CMCEE International Symposium on Ceramic Materials and Components for
Energy and Environmental Applications
Website for registration: http://www.cmcee12.de/
Name: CMCEE International Symposium on Ceramic Materials and Components for
Energy and Environmental Applications
Typical time of year: September
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What: World’s largest trade fair for supplies to the ceramics industry Buyers and
trade visitors from around the world came to the fair, interested in purchasing the very
finest technology for the production of tiles, bathroom fixtures, tableware and bricks
Website for registration: http://en.tecnargilla.it/http://www.cmcee12.de/
Name: Ceramitec
Typical time of year: October
What: Technology, Innovation and Materials in the ceramic industry
Website for registration: http://www.ceramitec.de/en/
8.2 INDUSTRY SUPPORT AND NETWORKING GROUPS
• British Ceramic Federation - http://www.ceramfed.co.uk/
• The American Ceramic Society - http://ceramics.org/
• International Ceramic Federation - http://www.ceramic.or.jp/icf/
8.3 EMPLOYEE INCUBATOR
Employees have a day or week in which they are only focused on developing new
ideas and opportunities for the company
8.4 BUSINESS PLAN COMPETITION
Local university students submit plans in a competition. Winner is allowed to utilize
Doncasters Ceramics facilities and further evolve their plan in-house at Doncasters
Ceramics.
Small business associations also have business plan competitions. People often have
great ideas but not the working capital for infrastructure. Therefore, a partnership and
revenue share is mutually beneficial for both Doncasters Ceramics and the winner,
selected by Doncasters Ceramics.
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9.0 CONCLUSION
In conclusion, research suggests that the most sustainable and profitable option for
Doncasters Ceramics is to consider ceramics as the end product. The solutions are
separated by cost, implementation time, and difficultly of execution. The research
indicated ceramic firebricks and insulation bricks, ceramic cutlery, ceramic carbon
brakes, and ceramic filters are a few of the most viable options for the future of
Doncasters Ceramics.
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10.0 LEADS
Arrigo Borin – Owner AB CONSUL SRL – Milan, Italy
“Dear Krista-Nicole, my company deals with technical ceramics and we are looking
for sintered silicon nitride components. Not turbine blades or similar high tech
applications, just wear resistant plates, but of course with good quality and
competitive (Europena not Chinese) price. Quantities may vary from few hundreds up
to thousands.
If you think that there is room for discussion, please, contact me and I shall forward
relevant details.
Best Regards
Arrigo Borin
cerinco@libero.it
51. Page 51 of 67
11.0 ELECTRONIC ADDENDUM
Attached on the USB drive of this report are MS Excel files, full marketing reports,
and other documents:
• DoncastersCeramicsReport.pdf
• 4.1 Ceramic Firebricks - The 2009 Import and Export Market for Refractory
Bricks - United Kingdom.pdf
• 4.1 Ceramic Firebricks - The 2011 Import and Export Market for Refractory
Bricks - United Kingdom.pdf
• 4.1 Ceramic Firebricks - The 2011 Import and Export Market for Refractory
Bricks in Europe.pdf
• 4.1 Ceramic Firebricks - Vitcas-Refractories-High-Temp-Insulations-
Industrial-Catalogue.pdf
• 4.2 Ceramic Cutlery - Cashflows.xlsx
• 4.2 Ceramic Cutlery - Doncasters NPV Calculations v2.xlsx
• 4.2 Ceramic Cutlery - I100 brch.pdf
• 4.2 Ceramic Cutlery - I100-UK (Knife Sharpening Machine).pdf
• 4.2 Ceramic Cutlery - Production Steps.docx
• 5.1 Ceramic Disc Breaks - The 2011-2016 World Outlook for New Motor
Vehicle Disc Brakes.pdf
• Ceramic Filters - Ceramic water filter _ Practica Foundation.pdf
• 6.1 Ceramic Filters - Durand Water Filters.pdf
• 6.1 Ceramic Filters - The Secret to Desalination_ Ceramics _ Greentech
Media.pdf
• 12.0 DoncastersCeramicsFridayPresentation.pptx
52. Page 52 of 67
12.0 CONSULTING TEAM
Krista-Nicole Bishop – Marketing & Branding Expert
Krista is currently completing her MBA with an emphasis in
Global Business at the University of Redlands. Krista
completed her undergraduate work with a BA in Business,
Minor in Political Science at Whittier College in California.
She has several certifications in Social Media, Marketing &
Media, Digital Media and Business Writing. Krista owns a
small marketing and brand development company. Krista has
recently joined the international tech company, JMango, as
VP of Sales & Marketing for North America. She will aid the
company in its entry to the North American marketplace.
Michelle Churchill – Global Information Systems
Michelle Churchill is graduating with her Masters in Business
Management from the University of Redlands.
Environmental Systems Research Institute, Inc. currently
employs her in their purchasing department. Michelle handles
onboarding of new international offices, acquisitions and US
regional offices. Along with global offices she also contracts
marketing events throughout the US as well as handles
contract negotiations and large sourcing initiatives. Prior to
her employment at Esri, Michelle worked in international
sales for a global freight forwarding company.
Ryan Cobb – Information Technology, Asset Manager,
Finance
Ryan Cobb is graduating with his Bachelors of Science of
Business from the University of Redlands and is currently an
asset manager for a non-profit developer, builder, and
manager of low-income housing across the Unites States. Mr.
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Cobb has over 20 years experience in the title insurance and
real estate industries, and recently started his own company,
Ryconn Properties, specializing in the management of retail
centers.
Joshua Goldman – Operations, Logistics & Finance
Joshua D. Goldman is graduating with his Masters of
Business Administration in Global Business from the
University of Redlands. He is a former Marine Captain with
combat tours in Operation Iraqi Freedom and Operation
Enduring Freedom. He is currently Director of Operations for
Ruan Transportation Corporation with responsibility for a
team that totals over 500 and executes in excess of 135,000
annual domestic deliveries to Ruan serviced Target stores
across the United States.
Dr. Michael M. MacQueen – Faculty Advisor
Michael M. MacQueen is an Associate Professor at the
University of Redlands’ School of Business, where he teaches
undergraduate and graduate financial and managerial
accounting courses. Professor MacQueen has over 20 years
experience teaching college-level accounting courses and
prior to his appointment at the University of Redlands spent
25 years working in a variety of executive positions in the
accounting industry. He holds a doctorate in organizational
leadership from the University of LaVerne, an MBA with an
accounting concentration from the California State University,
Pomona, and a BA in economics from the University of
California, Los Angeles. He is a licensed Certified Public
Accountant in the state of California and is an active member
of the American Institute of Certified Public Accountants
(AICPA).
67. Page 67 of 67
14.0 THANK YOU
In conclusion, research suggests that the most sustainable and profitable option for
Doncasters Ceramics is to consider ceramics as the end product. The solutions are
separated by cost, implementation time, and difficultly of execution. The research
indicated ceramic firebricks and insulation bricks, ceramic cutlery, ceramic carbon
brakes, and ceramic filters are a few of the most viable options for the future of
Doncasters Ceramics.
