Akij eyes global faucet market after meeting local demand

Akij Group, one of the largest conglomerates in the country, has recently started manufacturing faucet products using European technology with the biggest investment so far in the sanitary ware industry.

Sheikh Bashir Uddin, managing director of Akij Group, recently spoke with The Business Standard about their new investment in the sanitary ware industry and the group's future plan in the sector.

What are Akij Group's objectives to enter the market of bathware products?

In the local market, there is demand for good products, for which we have to depend on foreign products. Akij always wants to serve people by producing quality products. This is why we come to this industry. We are working to produce good quality faucets for people.

How is the quality of the products you are producing?

Traditionally Akij works more on quality. We maintain quality in all areas of any product we produce. We have researched for one and a half years before bringing this product to the market.

We made the faucet by researching the climate of Bangladesh, people's tastes and needs. We have employed one of the most renowned organisations in the world to understand the water quality of Bangladesh for about one and a half years. Salinity is a problem in the environment of Bangladesh especially in coastal areas. We tried to understand these things. After a year and a half research, we transitioned into implementation. We took about two to two and a half years to develop the project.

While manufacturing the products, we prioritised people's demand in all areas including the thickness, quality and materials used for the products. The two main components of a faucet are the aerator and the cartridge. We are sourcing both from the best companies in the world. Aerator can provide fine and economical water supply while the cartridge will make the water faucet function smoothly.

What are the technical differences between Akij faucets and other local products available in the market?

The casting process and polishing of our products is smooth and stylish. Its thickness is also better than any product. Traditionally, the casting process for common products is done by casting a mould and then furnace it through a die, which results in poor finishing.

On the other hand, our furnace and casting machines are completely modern. We drop the mould in a pressurised condition. The result is automated and polished. The work is not done according to the wishes of any operator. As it is an integrated system, no unpolished product comes out. We are the first to bring this technology to the subcontinent.

We have given utmost importance to the design to make the product world class. The polishing system is also automated.

Where did the idea of making such a high quality product come from?

For any project, we think we will sell the product not the project. So we try to make products of the highest quality. Our customers will use the product every day. So we ensure the best quality.

If you look at our faucet, you will see, it is the best in aesthetics. You will also get the best value in it. While taking projects we study the market and take a look at the products available, their price and also the quality.

Will the price of Akij faucets be within people's reach?

Our new product is of high quality. But we are keeping their prices low compared to the quality and foreign products. The middle class and the upper class can afford our faucets.

What is your investment in faucets? How do you gauge the future prospect?

Initially we are investing Tk125-150 crore. We plan on gradually raising it three times.

The market size of faucets in the country is Tk1,500-Tk2,000 crore. It is not a very big market at the macro level. But our target is not only the local market. We are not just thinking vertically rather we are thinking about horizontal market growth, which justifies our large investment.

You have announced expansion even before hitting the market. What is the thought behind it?

See, we started Akij Tableware last year. There was such a response that we are having a hard time supplying to meet the demand. Same goes for sanitary ware. We have tripled the production capacity in ceramics and sanitary ware and we are increasing it more. We can safely target expansion with the response we have received so far with our faucet products.

You must be thinking of exporting abroad…

The market for faucets in our country is very small (Tk1,500-Tk2,000cr). As a result, we have to think about exports. A retailer in England is a buyer of our sanitary ware. They have already visited our faucet factory and are impressed with the products. We can start exporting soon. We have produced some special products for them as well.

Let's talk about the next 10 years. How do you want this industry and the market for Akij faucets to look like?

This is very difficult to answer. We started exporting table ware only last year. Hopefully, we can become the top exporter of Bangladesh in the next one or two years. We are rejecting many international purchase orders. Same goes for sanitary ware. This is mainly due to the energy crisis. Moreover, I am giving more priority to the local market. I want to be stronger in the local market.

On the other hand, if we talk about the potential of the faucet market, we see a huge potential if we judge its value chain. There is also a huge opportunity for us in the global billion-dollar market.

There are also possibilities for us to export to the whole of Europe and the Middle East. Our neighbouring India is also a market with huge potential.

How do you assess the business pressure in the aftermath of the Russia-Ukraine war and the energy crisis following the Covid-19 pandemic?

The impact of Covid has affected all the countries of the world. However, the central bank has given good support to tackle the pandemic-time problems. At that time there was money but demand decreased. A lot of products were in stock. But now the crisis caused by the Russia-Ukraine war is different. Now there is inflation. People in the West are not that familiar with inflation. They are also facing it. We are facing a fuel crisis with inflation. It has created a fear of food security. We are slowly moving towards high inflationary pressure.