10 Market's Economic in Malaysia

Table of Contents
1.0
Introduction.....................................................................................................................1
2.0
Type of Market................................................................................................................2
2.1 Reinforcement..................................................................................................................2
2.1.1. Introduction..............................................................................................................2
2.1.2 List of companies......................................................................................................2
2.1.3 Type of products supplied.........................................................................................3
2.1.4 Market and justification............................................................................................4
2.2 Lighting............................................................................................................................6
2.2.1. Introduction..............................................................................................................6
2.2.3 Type of products supplied.........................................................................................7
2.2.4 Market and justification............................................................................................7
2.3 Roller shutter....................................................................................................................9
2.3.1 Introduction...............................................................................................................9
2.3.3 Type of products supplied.......................................................................................10
2.3.4 Market and justification..........................................................................................10
2.4 Landscape.......................................................................................................................12
2.4.1 Introduction.............................................................................................................12
2.4.2 List of companies....................................................................................................12
2.5 HVAC (air conditioner)..................................................................................................15
2.5.1 Introduction.............................................................................................................15
2.5.3Types of product supplied........................................................................................16
2.6 Sanitary fitting (WC)......................................................................................................18
2.6.1 Introduction.............................................................................................................18
2.7 Door................................................................................................................................21
2.7.1 Introduction.............................................................................................................21
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2.7.3 Type of product supplied.........................................................................................22

2.8 Paint................................................................................................................................24
2.8.1 Introduction.............................................................................................................24
2.9 Cement...........................................................................................................................27
2.9.1 Introduction.............................................................................................................27
2.9.2 List of companies In Malaysia that have 8 of the cement industries in Malaysia. .27
2.10 Tiles..............................................................................................................................29
2.10.1 Introduction...........................................................................................................29
2.10.2 List of companies..................................................................................................29
2.10.3 Type of product supplied.......................................................................................30
2.10.4 Market and justification........................................................................................31
Inidividual Assignment............................................................................................................32
Yung Kong targets RM500mil revenue on rising steel demand...........................................32
Rising Cost Worries Oil Palm Planters................................................................................33
How RBM building technology works................................................................................34
House Price Hike Likely......................................................................................................35
Construction forecast to grow by 13 percent.......................................................................37
References................................................................................................................................38
1.0 Introduction
There are 4 structures in market structure which are monopoly, oligopoly, monopolistic
competition and pure competition. In this assignment our group is required to select 10
markets that relevant to the building construction. From the 10 markets, we are required to
give the justification and determine which of the market structure for the each market.
The 10 market we choose are reinforcement, lighting, roller shutter, landscape, HVAC
(air conditioner), sanitary fittings (WC), door, paint, cement and tiles. The details of each
market is shown as the report below.
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2.0 Type of Market

2.1 Reinforcement
2.1.1. Introduction
Reinforcement or can be known as steel is a main component in the construction site. It not
only use as main bar for beam, column and others, but also use as BRC, link and hook. Based
on Oxford Dictionaries (2013), reinforcement has been described as the strengthening
structure or material employed in reinforced concrete.
2.1.2 List of companies
There are not many companies in Malaysia which supply reinforcement in the Malaysia.
There are 7 major steel suppliers in the whole Malaysia. Each state has 3 to 4 major steel
suppliers. The major steel suppliers in Malaysia are:
i)AYS Marketing Sdn Bhd
ii)
Perkasa Trading Sdn Bhd
iii)
Tet Tafa Hardware Sdn Bhd
iv)
Yontai Hardware Sdn Bhd
v)
RM Wire Industries Sdn Bhd
vi)
Kamen Steel Industries Sdn.Bhd.
vii)
Asia Wire Steel Mesh Manufacturers Sdn Bhd
AYS Marketing Sdn Bhd
Asia Wire Steel Mesh Manufacturers Sdn Bhd
2.1.3 Type of products supplied

There is various type of steel that supplied by the supplier above as shown in below
Companies
AYS Marketing Sdn Bhd
Type of products
BRC Wire Mesh (BS)
Steel C Channel
Steel Checkered plates
Steel Flat Bars
Steel Rectangular Hollow Section
Steel High Tensile Reinforcement Bars
Steel Mild Round Reinforcement Bars
BRC Wire Mesh (BS)
BRC Wire Mesh (CQ)
Steel Flat Bars
Steel Rectangular Hollow Section
Steel Square Hollow Section
Steel U Channel
Steel Unequal Angle Bars
BRC Wire Mesh (BS)
BRC Wire Mesh (CQ)
Steel Checkered plates
Steel Equal Angle Bars
Steel U Channel
Steel Unequal Angle Bars
BRC Wire Mesh (BS)
Common Wood Nails
BRC Wire Mesh (BS)
BRC Wire Mesh (BS)
Asia
Wire
Steel
Mesh
BRC Wire Mesh (BS)
Manufacturers Sdn Bhd
High Yield Steel Bar
Steel Flat Bars
BRC Wire Mesh
Steel U Channel
2.1.4 Market and justification

Steel industry can be said as an oligopoly market. Oligopoly is a structure that in between of
pure competition and pure monopoly (Robert H. Haven, 1981, pg 207). It is few sellers
compete for the entire market. In this kind of market each firm has enough power to avoid
being a price taker, but they are still subject to a sufficient amount of competition to know the
market is not entirely under their control (Danny Myers, 2008, pg.122)
Number of firms
There are only 7 major steel companies in Malaysia and each of it can be state as big
companies. Thus, it full fill the oligopoly market which is a field that occupied by few large
companies.
Control over price

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There is only 7 steel suppliers in the Malaysia, thus the market of the steel is just competition
among 7 of it. Therefore the price of demand will be very inelastic. Due to fewer companies
they can easy to control the price in market when all the companies do the same decision.
However, the government, Ministry of Domestic Trade and Consumer Affairs (MDTCA) has
set a range of price, thus the control over price of each companies will be lower.
Degree of product differentiation
In degree of product differentiation, the steel product that provide by each companies is
almost the same However there is some products that those company is different to the other
companies such as steel C channel which only supply by AYS Marketing Sdn Bhd. Thus, it is
full fill the properties of oligopoly market which the products can be standardized or
differentiate.
Conditions of entry
The condition of entry of the reinforcement market is hard. This is because the size of each
company is large make that the entrances become harder. Other than that, the new enter
companies need to have the source of raw material, large capital to having the machine for
produce the steel.
2.2 Lighting
2.2.1. Introduction
Lighting is a type of product in building or construction equipment. Lighting not only for the
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light up the room but also can be decoration purpose. Lighting is very important to the human
being for the comfortable purpose. It is especially in the night time, without the sunlight the
only one thing can light up the room is lighting.

There are many companies in Malaysia which supply lighting in the Malaysia. There are
more than 50 companies that supplied lighting features suppliers in the whole Malaysia. The
lighting suppliers in Malaysia are:
i.
ii.
iii.
iv.
Philips Malaysia Sdn Bhd

Panasonic Malaysia Sdn Bhd
Khind Electrical (Malaysia) Sdn Bhd
Hibikii Global Sdn Bhd
Philips Malaysia Sdn Bhd
Khind Electrical (Malaysia) Sdn Bhd
Panasonic Malaysia Sdn Bhd
Hibikii Global Sdn Bhd
There is various type of steel that supplied by the supplier above as shown in below
Led light bulb
Circular fluorescent
Fluorescent tube

Lighting industry can be said as monopolistic competition market. Monopolistic competition
is a structure that in between of pure competition and monopoly (Robert H. Haven, 1981, pg
207). It is many sellers compete for the entire market. In this kind of market each firm can
earn above normal profits, but only for a short while because others companies will respond
by produce the similar products (Danny Myers, 2008, pg 122)
Number of firms
There are many lighting companies in Malaysia and each of it can be state as small
companies. Thus, it full fill the monopolistic competition market which is a field that
occupied by huge number of small companies.
Control over price
There is many supplier in the Malaysia, thus the supply of lighting is much higher than the
demand of it. There for the price of demand will be very elastic. Other than that, supplier
need to competitive with many suppliers so the control over price will lower. However each
of the companies has their unique so it will make the control over price higher than the pure
competition but lower than the oligopoly structure.
In degree of product differentiation, the function of lighting can direct influence the total
sales. The differentiation can be energy in use, design and their performance. Examples, both
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companies have same type of the product, but one input voltage is 75V and another is 60V.
Due to the power supply might affect the electric fees per month. Therefore, buyers can easily
determine which products more suitable for their concern. This also affected by the design of
the bulb head because it can make the room more decorative.
Conditions of entry
The condition of entry of the air-condition market is medium. This is because the numbers of
companies is many make that the entrances become easier however each of the companies
has their own unique this might make the new companies need to have their own unique to
sustain in this market. The new market need to have the capital and technology to produce the
light bulb by itself.
2.3 Roller shutter

2.3.1 Introduction
Roller shutter is normally defined as a vertical revolving barrier at the entrance of a building
or room. Roller Shutter is mainly made out of metal or bullet proof glass. During the opening
position its leaf, curtain or slats will rolled upwards and downwards during closing position.
Roller shutter are widely found in malls, banks, garage, restaurant and many other places.
The functional requirements of a roller shutter are basically almost the same with the
functional requirement of a door. Roller shutter should have:
Fire protection
Durable
Provide safety for the building
Weather resistance (against rain)
Reduce space during operating (opening and closing does not use much space
compare to door)
Some roller shutter also allow ventilations

There are a wide range of roller shutter firms in Malaysia. Those are:
BC ROLLER SHUTTER SERVICES SDN BHD

Seng Kong Shutter Industries Sdn Bhd
STAR ROLLING Shutter Sdn. Bhd.
COL shutter specialist
SKB Shutters Manufacturing Sdn Bhd
Kimico Sdn Bhd
Transparent polycarbonate roller shutter

Aluminium shutter door
Fire resistance roller shutter
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Light and heavy duty shutters

See- through shutters / transparent shutter

The market structure for roller shutter companies in Malaysia is in a form of Monopolistic
Competition. This could be identifying as it has the characteristic of monopoly and
competition. Not only that, even though there is a numbers of firm but the product sold is not
homogenous.
Control over price
Firms for roller shutter could control over their price. This is because each supplier have their
own unique product but the price could not have a big different between the firms. Compare
to Pure Monopoly market the supplier has the full power marketing the price.

Firms in roller shutter market have a low degree of product differentiation. This is clearly
seen as most of the firms are supplying the same type of product but different in patterns
based on customers preferences.
Condition of entries
The entries for a roller shutter firms is easier compare to oligopoly and pure monopoly
market, but it is not that mobile compare to pure competition. This is because there are few
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rules and condition by the government to enrolled in to the business.
2.4 Landscape
2.4.1 Introduction
Landscaping is very common in the construction site. Landscaping is widely found after a
building is completed to enhance the look of the building and create a good environment for
the resident to stay. Not only that, landscape was result by a combination of plants, turf, trees
and others even pavement. Sometimes fountains and lamp post are included in design for
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affordable residents. Other common function for landscape is to reduce the amount of haze,
create a harmonious environment to distress and reduce the level of noise in the cities.

The landscape companies in Malaysia are:
Asia Flora & Landscape Sdn. Bhd.

Bumi Hijau Landscape
Walker & Jansen Sdn Bhd
Greenlife Landscape
Home Garden Enterprise
MARKHAM Landscape Products

Type of product:
Aggregate
Plants and flowers
Turf
Pavement
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The market structure for landscaping in Malaysia is Monopoly Competition. This is due to
the homogenous decorative product supply by the supplier. Moreover producer have easily
start up their own business with the help of their plot of land. Based on this factor it had
become a competition between other firms.
Control over price
In landscaping business the price control is a bit different compare to other Monopoly
competition. Landscaping business is based on the architecture design to demand for the
products. Therefore supplier could control on the price until both the supplier and consumer
agree on it.
Degree in product differentiation
In landscaping design there are few basic homogenous supply from the firms but they also do
have other unique product in their market to attract customer. Therefore the degree of
differentiation of landscape is quite moderate. Home designer will then had to redeem
product from many kinds of supplier.
Condition of entries
The condition of entries in a landscape business is moderate as in it is easier to enter or exit
compare to oligopoly and pure monopoly market. This is because plants and aggregate are
natural sources on earth and it is easy to kick start a firm through it.
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2.5 HVAC (air conditioner)

2.5.1 Introduction
HVAC is a type of product in building or construction equipment. HVAV can be differentiated
to two categories, which are ventilation and air conditioner.Ventilation is defined as the
process of changing air in an enclosed space.Air conditioning is the process of altering the
properties of air (primarily temperature and humidity) to more favorable conditions.
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The market of air conditioner in Malaysia is full with competition. There are 29 companies in
Malaysia. The producers in Malaysia are:
1.
2.
3.
4.
5.
6.
Samsung Malaysia Electronics (SME) Sdn Bhd

York (Malaysia) Sales & Service SdnBhd
Acson Malaysia Sales & Service Sdn. Bhd.
Mitsubishi Electric (Malaysia) Sdn. Bhd.
Hitachi electronic products (m) sdnbhd
And etc.
2.5.3Types of product supplied
SamsungMalaysia Electronics (SME)Sdn Bhd York(Malaysia) Sales & ServiceSdnBhd
Mitsubishi Electric (Malaysia) Sdn. Bhd.
Acson Malaysia Sales & Service Sdn. Bhd.
Hitachi electronic products (m) sdnbhd
Vendors provide many types of product to achieve maximum satisfaction of Malaysian. Air
conditioner provides a comfort environment to Malaysian and good regulation of air.In 2010
year, the total sale of air conditioner in Malaysia is achieved 50 million units. Below show
the products provided from difference companies:
Company
SAMSUNG
YORK
ACSON
Products
Floor Standing AC
Wall Mounted Split AC
Window AC
DVM system
Wall mounted
Portable air conditioner
Wall mounted
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MITSUBISHI
HITACHI
Wall mounted
DVM system
MOVEO Portable air conditioner

Ceiling cassette air conditioner
Water cooled modular chiller
Floor standing series
Wall mounted
Air curtain
Wall mounted split dc inverter
Wall mounted split constant speed
Window AC
Ceiling cassette
Floor standing AC
Window AC
Ceiling cassette EQ

The market structure of air conditioner is MONOPOLISTIC COMPETITION. Based on
my research, the products produced by companies are slightly differentiated. Each seller may
set price for their own product. There are many sellers in the air conditioner market.
Control over price
In my opinion, there is many supplier in the Malaysia, thus the supply of HVAC is much
higher than the demand of it. There for the price of demand will be very elastic. Other than
that, supplier need to competitive with many suppliers so the control over price will lower.
However each of the companies has their unique so it will make the control over price higher
than the pure competition but lower than the oligopoly structure.
16

In degree of product differentiation, the function of air conditioner can direct influence the
total sales. The differentiation can be energy in use, design and their performance. Examples,
both companies have same type of the product, but one input voltage is 2400V and another is
3200V. Due to the power supply mightaffect the electric fees per month. Therefore, buyers
can easily determine which products more suitable for their concern.
Conditions of entry
The condition of entry of the air-condition market is medium. This is because the numbers of
companies is many make that the entrances become easier however each of the companies
has their own unique this might make the new companies need to have their own unique to
sustain in this market.
2.6 Sanitary fitting (WC)

2.6.1 Introduction
WC is main type of the building products or material.It can be divided to squatting style,
sitting style, and standing style.

There are a lot of company supplied WC in Malaysia. A total of 34 companies developed in
Malaysia. There are:
1. Claytan group c/o. Clay industries sdnbhd
2. Goldolphin(m)sdnbhd
3. Johnson Suisse (Malaysia) Sdn. Bhd
4. Saniton Ceramic (M) Sdn. Bhd
5. Potex Industries Sdn Bhd
6. And etc.
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Claytan group c/o. Clay industries sdnbhd
Johnson Suisse (Malaysia) Sdn. Bhd
Goldolphin(m)sdnbhd
Saniton Ceramic (M) Sdn. Bhd
Potex Industries Sdn Bhd

In the WC market, the vendors provided too many type of WC for customer to choose.
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Squatting pan
Floor mounted
Wall hung
Bidet
One piece
Urinal

The market structure of WC is MONOPOLISTIC COMPETITION. As the name implies, this
form of industry structure processes characteristics of both competition and monopoly.
Although it is characteristics by many firms like competition, each firm does not produce and
sell a uniform or homogeneous product. (Robert H. Haveman, 1981, pg.220)
Control over price
The sellers may hard to control their own products price. In my opinion, there are many
suppliers in the Malaysia. This make the supplier need to competitive with many suppliers so
the control over price will lower. However each of the companies has their unique so it will
make the control over price higher than the pure competition but lower than the oligopoly
structure.

The product produced by each firm is highly substitutable with the products produced by the
other firms in the industry or group which is the competitive element. This high degree of
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product similarity is what distinguishes the monopolistically competitive market from either
monopoly or competition (Robert H. Haveman, 1981, pg.221).
Conditions of entry
Monopolistic competition occurs where large number firms are free to enter the market with a
differentiated or similar product. There are no close substitutes for the product of a
firm(Robert H. Haveman, 1981, pg.221).The condition of entry of the sanitary market is
medium. This is because the numbers of companies is many make that the entrances become
easier however each of the companies has their own unique this might make the new
companies need to have their own unique to sustain in this market.
2.7 Door
2.7.1 Introduction
Door is a solid barrier that is fixed in a door way or opening of a wall with the help of iron
lugs or hold fasts in the walls. Door consist of two parts, one partis frame of the door and
other part is shutter of the door.
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Number of firms :
30
Competitor firms :
Gaya Murni Sdn Bhd
New Century Security Door Enterprise Sdn Bhd
Artilux Sdn Bhd
Big Bath (Kepong) Sdn Bhd
Jee Lee Industrial Supply Sdn. Bhd.
E.V. Oilfield Supply & Services Sdn Bhd
Gaya Murni Sdn Bhd
Big Bath (Kepong) Sdn Bhd
Artilux Sdn Bhd
E.V.Oilfield Supply & Services Sdn B
2.7.3 Type of product supplied

Decorative Entrance Doors, Vendor or Service Doors, Fire rated Doors, Swinging Traffic
Doors, Cooler and Freezer Doors and Vinyl Strip Doors.
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Decorative Entrance Doors
Swinging Traffic Doors
Fire rated Doors
Vinyl Strip Doors
Vendor or Service Doors
Cooler and Freezer Doors

Model of market structure
Monopolistic Competition
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Control over price
Certain price decisions are made according to the production cost of the products due
to their different quality, size requirement and etc.
Door from each manufacturer can be differentiated through their size, strength to
resist the compression and tension stresses, quality and texture etc.
Conditions of Entry
The firms must have sufficient technology and skilled workers to produce high quality
products.
The quality of some products must be certified by the ISO and SIRIM because the
products may for public usage and will affect the public safety.
Must have sufficient capital because those products consume a lot of production costs.
The manufacture firms must have their own sources for raw materials to make sure
their supplies to the market are continuous.
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2.8 Paint
2.8.1 Introduction
Paint market. In this market it supply and produce paint product such as water based , acrylic
based emulsion paint, wall finish , emulsion paint , Interior & Exterior Gloss Finish, Exterior
Timber Finish, Exterior Wood Varnish ,Solvent-based Protective Coating, thinner, putty wall,
paint remover, wood paint, primer and sealer.
Seamaster
OD Paints
Colourland
Sissons
Super Glo Plus (Wood Paint )

Timber Colour ( Wood Paint)
Ecolux Ecowood ( Wood Paint )
Synlac (Wood Paint )
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Model of market structure
Oligopoly
Number of firms
Although there are not too many company or firms in the market but it will also cause
competitive among them due to the homogeneous product. This will cause difficulty to
promote their own product to their customer. They will have to think out of the box in order
to attract more customers to purchase their product.
Control over price
They using the concept of influence on the price-output policies of their rivals.
Every company is so influential that his rivals cannot ignore the likely adverse effect
on them of a given change in the price-output policy of any single manufacturer. The
rival consciousness or the recognition on the part of the seller is because of the fact of
interdependence. The demand curve under oligopoly is indeterminate because any
step taken by his rivals may change the demand curve.
More elastic than under simple monopoly and not perfectly elastic as under perfect
competition. It is often noticed that there is stability in price under oligopoly. This is
because the oligopolistic avoids experimenting with price changes. They knows that if
raises the price, it will lose customers and if he lowers it will invite rivals to price war.
Degree of Product Differentiation
Differences in quality which are usually accompanied by differences in price
Differences in functional features or design
Ignorance of buyers regarding the essential characteristics and qualities of goods they
are purchasing
Sales promotion activities of sellers and, in particular, advertising
Differences in availability (e.g. timing and location).
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Conditions of Entry
Difficult to maintain their position of dominance in a market (too costly or difficult

for potential rivals to enter the market. )
Economies of large scale production. (if a market has significant economies of scale
that have already been exploited by the incumbents, new entrants are deterred)
Ownership or control of a key scarce resource. (Owning scarce resources that other
firms would like to use creates a considerable barrier to entry, such as an airline
controlling access to an airport.)
High set-up costs. (High set-up costs deter initial market entry, because they increase
break-even output, and delay the possibility of making profits. )
High Research and Development costs ( a signal to potential entrants that the firm has
large financial reserves. )
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2.9 Cement
2.9.1 Introduction
Cement is a very important material in the construction industry. It is the main component to
make produce the concrete. It can be said as the main material need in the construction even
the substructure or the superstructure.
In Malaysia that have 8 of the cement industries in Malaysia
Aalborg Portland Malaysia Sdn Bhd (APMSB)
Holcim (Malaysia) Sdn Bhd (HMSB)
Cement Industries (SABAH) Sdn Bhd (CIS)
CIMA Group of Companies
CMS Group
YTL Cement Group
Tasek Corporation Berhad (TCB)
Lafarge Malayan Cement Berhad (LMCB) Group.
Blue lion cement

Type I Portland cement
BLUE LION COMPOSITE CEMENT
NS COMPOSITE CEMENT NS CEMENT

Type I Portland Cement and Type II
NS Brick
NS Eco Crete LH
27

After the research I found that cement industry is in pure oligopoly market. This word comes
from the Greek oligos meaning "little or small and polein meaning to sell. When
oligos is used in the plural, it means few. As information oligopoly is a market structure
in which the number of sellers is small. Furthermore, in oligopoly can be divide to two that is
Pure oligopoly have a homogenous product. Pure because the only source of
market power is lack of competition. An example of a pure oligopoly would be the
steel industry, which has only a few producers but who produce exactly the same
product.
Impure oligopoly have a differentiated product. Impure because have both lack of
competition and product differentiation as sources of market power.
Control over price

There is only 8 cement suppliers in the Malaysia, thus the market of the cement is just
competition among 8 of it. Therefore the price of demand will be very inelastic. Due to fewer
companies they can easy to control the price in market when all the companies do the same
decision.
In degree of product differentiation, the cement product that provide by each companies is
almost the same .Thus, it is full fill the properties of oligopoly market which the products can
be standardized or differentiate.
Conditions of entry
The condition of entry of the cement market is hard. This is because the size of each company
is large make that the entrances become harder. Other than that, the new enter companies
need to have the source of raw material, large capital to having the machine for produce the
cement.
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2.10 Tiles
2.10.1 Introduction
Tiles is to organize a building to become beautiful it can be divide to wall tiles, floor tiles and
bathroom design. Besides that tiles also have a lot of the size to fix in to a building to make
sure the building more amazing and beautiful

On the other hand, in Malaysia have 1454 of firm and supplies in this industry and this is the
10 of the example firm in Malaysia.
A&I Trading & Consulting Sdn. Bhd
Link International Kl Limited
Future Deco Marketing Sdn. Bhd
Lalang Resources Sdn. Bhd
Jubin Bms (1990) Sdn. Bhd
Monacol Trading Company
Antai Resources Sdn Bhd
8X8 Mickey Milano Blue
8X8 Mickey Milano Chocolate
12X12 Puangpayom Blue 12X12 River Stone Beige
Red Link Enterprise
Liux Sdn. Bhd
Niro Ceramic Sales & Services (M) Sdn Bhd
24X24 Riverwood Oak
24X24 Adratic Beige
29
24X12 Rocky Stone
30

Tiles industry is in monopolistic competition because those have many firm including in tiles
industry. Monopolistic competition describes a common market structure in which firms have
many competitors, but each one sells a slightly different product. Monopolistic competition
as a market structure was first identified in the 1930s by American economist Edward
Chamberlin, and English economist Joan Robinson.
Control over price
There are over 1000 tiles suppliers in the Malaysia, thus the market of the tiles are full with
competition. Due to many companies they cant easy to control the price in market. This is
because it is hard to let all the companies to have the same goals.
In degree of product differentiation, the tiles product that provide by each companies is same
type but different in terms of design. Thus, it is full fill the properties of monopolistic
competition market which the products are differentiate in terms of design. Each of the
company has provide the different of the tiles just like JUBIN BMS (1990) SDN. BHD have
provide a lot of the ceramic tiles with different size and design.
Conditions of entry
The condition of entry of the tiles market is medium. This is because the size of each
company is small, it makes that the entrances become easier. However, the new enter
companies need to have the source of raw material, and the ability to have a unique design to
sustain in this market structure .
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Inidividual Assignment
Yung Kong targets RM500mil revenue on rising steel demand
Yung Kong Galvanising Industries Bhd (YKGI) targets group revenue to hit the
RM500mil mark this year on improving demand for its products as the local steel industry
recovers from its doldrums. YKGI, which has manufacturing facilities in Selangor and here,
is Malaysia's top three flat steel producers among the seven players. The group's main
products are pickled and oiled coils, cold rolled coils, galvanised iron coils and pre-painted
galvanised iron coils. They expect a 25% increase in group production to 250,000 tonnes this
year from about 200,000 tonnes last year. YKGI group sourced its imported raw material and
hot rolled coils from Nippon Steel Corp, which has a 10% equity interest in it to lower
production cost. The private placement of more than 39.1 million shares will raise gross
proceeds of RM19.55mil. They agreed to subscribe to a minimum of 10 mil placement shares
and the remaining new shares would be placed out to third party investor. The restricted issue
of 48.8 mil shares to Marubeni-Itochu Steel Inc will raise gross proceeds of RM24.4mil.
From the gross proceeds, RM1mil will be used to pay for the expenses of the corporate
exercise. On completion of the acquisition, Starshine will become YKGI's wholly-owned
subsdiary. Starshine group is principally involved in the manufacturing and trading of both
long and flat steel products.
YKGI state that increase the demand for its product can increase the total revenue. This
is because the total revenue is based on the value of sale times with the price. In order to
increase the demand of the company, the increase of the production is needed. The imported
raw material from Nippon Steel Corp which has equity interest can reduce the cost to
produce. Thus the production can be increase with the same cost. The company is doing the
process of acquisition is to increase the capacity of its company. This is because Starshine
group has the same field and manufacture the same products which are flat steel products.
Total Revenue ( TP )=Price quantity demand
BY: PAN MING CHUAN (12WTD01607)
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Rising Cost Worries Oil Palm Planters

Oil palms have been the basic need of consumers in Malaysia; this would cause
government and oil palm planters to face huge stress if there is a rise and fall in the oil palm
economy. Therefore what worries the oil palm planter the most is that the rise in their worker
wedges and the fall in consumer demands. Not only that, based on Mapa (Malayan
Agricultural Producers Association) exclusive director Mohamud Audong, the rise of oil palm
price is due to the costlier fertilizer, more expensive foreign worker recruitment fees, higher
transportation cost and various taxes imposed by the federal and state governments.
Moreover, if oil palm price drops below RM2000 per tonne, small holder or oil palm planter
would incur losses. Additionally, if the losses continue, the planters will hire fewer workers
and the harvest would reduce. Based on this factor, the amount of oil palm supply will fall
and price of oil palm will rise, but due to oil palm is a consumer necessity, the surplus of oil
palm will eventually become a shortage for consumers.
BY: SEE WEN PIN JONATHAN (12WTD01497)
33
How RBM building technology works

Foam concrete is used instead of concrete mix
Foam concrete or lightweight concrete is made in 3-in-1 patented mixer, the RBM-1000.
Once set, this building material is as strong as normal concrete, weighs much less, is easier to
transport, so that can reduce the cost of transportation fees. The maintenance fees also will be
reducing duo to concrete has better insulation and fire rating properties.
Easy to operate
The RBM-1000 functions like a mini continuous batching plant. It is mobile and can be
located at the construction site itself. It is easy to operate and has a pump that can deliver the
foam concrete to locations as high as 125m above ground (35 storeys) or 250m away. The
apparatus is very effective so that construction firm can spend less money on worker.
Formwork is made from steel panels, not timber planks
The foam concrete is poured into formwork made from RBM steel scaffolding panels. The
panels are modular in design and the position of electrical sockets, for example, are fixed
before the foam is poured in. Once the foam has set and the scaffolding removed, a finished
wall with a smooth surface is obtained. Plastering is unnecessary. Construction firm reduce
the construction cost of the building by construct this method.
Low operating cost
The RBM system is less costly to operate. It uses less manpower, produces less waste,
delivers a product of consistent quality, and has a faster turnaround time. RBM claims the
system can improve site productivity by more than three times, and reduce construction cost
by as much as 20%. The total cost will decrease duo to a lot of expense had been reduce.
Better return on investment
RBM technology is also less capital intensive. The company claims that two units of RBM1000 costing RM800, 000 can deliver an output equivalent to that of a conventional system
that can cost RM8mil-RM10mil. Such a system would consist of a concrete batching plant,
trucks to transport the concrete to the construction site, and heavy duty pumps to transport the
mix to the upper floors of a building. RBM technology is very functional because that can
replace a lot of apparatus.
BY: SHE ZHEN RUI (12WTD 07423)
34
House Price Hike Likely

16
14
12
10
D2
D
D3
6
4
2
0
A
This demand graph show the increase price will base on the labour, transport and another
material increase. For the article the selling price of properties in Penang will soon
increase by 5%-10%. A 50kg bag of cement is now priced at RM17.50, compared to
RM16.50 before the hike. 60% to 80% of the materials used for a building comprised
cement and cement-related materials. That why increase in cement prices will influence
property prices.
Due to cement firm is under oligopoly market model, if they want to make the profit
maximization, they will raise prices together. And they give signals already. Only Sarawak
has confirmed it would keep the prices in current level. Sand and aggregate increased also.
Due to this phenomenon, house prices on the island will rise by at least 10%, in Seberang
Prai, housing prices are expected rise by 5%, because of the additional transportation
charges
to
ferry
the
raw
materials
to
the
island.
Besides that, construction cost will go up by between 15% and 20%. Due to the cost of
labour and transportation charge has also increase in this year. The cost of labour had
increase to RM 45 per day this year compared to RM 35 a year ago. Transportation
charges for sand have increased to RM 450 per truck load this year from RM400 a year
ago.
The price also impacted by labour shortage, as many Indonesian workers have gone back
to Indonesia. This is booming currently.
The cement price hike would have less than a 1% impact on construction cost. But other
35
raw material such as brick, sand, aggregate, rebar and tiles were to increase drastically, the
price of housing have to review and adjust property selling price accordingly.
Price increased are by themselves not anti-competitive in nature. However, if there is
evidence of collusion among the competition to increase prices, this would be of concern
of MyCC and may merit an investigation.
BY: NG YI MING (12WTD05752)
36
Construction forecast to grow by 13 percent

The construction sector is expected to fare better in 2013 compared with 2012 on the
back of numerous projects in the pipeline. Due to impending 13th general election, there is the
buzzword political risk, which seems to be casting a shadow over the industry. The
president of Master Builders Association Malaysia (MBAM), Matthew Tee says that the
construction industry has fared well in 2012 on a year-on-year basis, with a growth in excess
of 20% and in budget 2013, we are looking at 13% growth this year. MBAM expected the
construction sector to grow to RM92bil from RM85bil in 2011. In note to investors, CIMB
Research analyst Sharizan Rosely says the delay in the signing of the RM7.1bil West Coast
Expressway, the award of the RM3bil-RM4bil Kinrara-Damansara Expressway and the
slowdown in the rollout of the Rubber Research Institute tenders had led to the slight
deceleration in the momentum of awards in the second half of 2012. In 2012, the ultimate
challenge the industry faced was the shortage of skilled workforce, it problem continuing
when entering 2013. Besides, the material costs, political factor and managing margins are
some of the reason to cause the construction forecast to grow up.
In my opinion, nations generally measure their economic performance base on the
market value of GDP in their annual income. National income is the aggregated earning of all
enterprises and individuals within the society. Since income is earned by producing and
selling goods, we can equally well use output or expenditure to measure the economy. In
order to overcome the price of the construction to raise the government should spend the
nation money wisely when they need to invest or purchase any goods and to ensure it bring
benefit to the people in our country and will return the profit to our country. Governments
also can encourage the nation people to work in construction firm and promise will return in
good income. Besides, the government also can produce the construction material in our own
country rather than import from other country. This is because it can reduce the import fees
and other taxes from other country and it will be more efficient to solve the material costs
problem.
BY: PRAVEEN NAIR A/L KRISHNA MURTHI (12WTD07165)
37
References
Cockeril,F, 1984, The economic management of firms, Oxford, Allan Philip.

Colander, David C, Microeconomics 7th ed. Page 288 McGraw-Hill 2008.
Danny Myers, 2008, Construction Economics, Great Britain by Cromwell Press,
Trowbridge, Wiltshire.(pg.122)
Hashem,E. 2002. Economic : Model Structure of Economic. Oxford University

Press.
Negbennebor, A, 2011, Microeconomics, The Freedom to Choose, page 291

Pindyck, R & Rubinfeld, Microeconomics 5th ed.Prentice-Hall 2001.D: (page
424,425,427)
Robert H. Haven, 1981, The Market System, John Wiley & Sons, United States (pg
207,220,221).
Alibaba, Reinforcement Steel, View on 18 June 2013
<http://www.alibaba.com/countrysearch/MY/reinforcement-steel.html>
Door, Door supply in Construction, viewed on 24th June 2013
<http://www.stardoor.com.my/about-us>
Economics online , Available from
<http://www.economicsonline.co.uk/Business_economics/Monopolistic_competition.
html> [Accessed: 18 JUNE 2013]

JUBIN BMS (1990) SDN. BHD ,Tiles Supplies, Available from
<http://www.jubinbms.com.my/company-profile/> [Accessed: 18 JUNE 2013]
Oxford University Press, 2013, Oxford Dictionaries, View on 18 June 2013
<http://oxforddictionaries.com/definition/english/reinforcement>
Persatuan Pemborong Binaan Malaysia Master Builders Association Malaysia
(MBAM), 2008, Master Builders Association Malaysia (MBAM) Supports
Proposal To Remove Price Control Mechanism, View on 26 June 2013
<http://www.mbam.org.my/mbam/index.php?
option=com_content&task=view&id=1031>
TABS Cricket Club and Collingham JFC, Oligopoly , Available from
<http://www.tutor2u.net/economics/content/topics/monopoly/oligopoly_notes.htm>
[Accessed: 18 JUNE 2013]

The Best Air Conditioner Brands, view 12 June 2013
<http://www.ranker.com/list/best-air-conditioner-brands/werner-brandes>
Toilet bowls, view 12 June 2013 <http://www.my.all.biz/toilet-bowls-bgg1004470>
Cement Industries of Malaysia Berhad 2011,Cement Supplies, Available from
<http://www.cima.com.my/cima/start.htm> [Accessed: 18 JUNE 2013]
38

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2.7.3 Type of product supplied.........................................................................................22

2.0 Type of Market

Tet Tafa Hardware Sdn Bhd

RM Wire Industries Sdn Bhd

Perkasa Trading Sdn Bhd

Yontai Hardware Sdn Bhd

Kamen Steel Industries Sdn.Bhd.

Asia Wire Steel Mesh Manufacturers Sdn Bhd

2.1.3 Type of products supplied

High Yield Steel Bar

Steel Flat Bars

BRC Wire Mesh

Steel Mild Round Reinforcement Bars

2.1.4 Market and justification

Control over price

2.2.2 List of companies

Philips Malaysia Sdn Bhd

Philips Malaysia Sdn Bhd

Khind Electrical (Malaysia) Sdn Bhd

Panasonic Malaysia Sdn Bhd

Hibikii Global Sdn Bhd

2.2.3 Type of products supplied

Led light bulb

2.2.4 Market and justification

2.3 Roller shutter

2.3.2 List of companies

BC ROLLER SHUTTER SERVICES SDN BHD

2.3.3 Type of products supplied

Transparent polycarbonate roller shutter

Light and heavy duty shutters

2.3.4 Market and justification

Degree of product differentiation

rules and condition by the government to enrolled in to the business.

2.4.2 List of companies

Asia Flora & Landscape Sdn. Bhd.

2.4.3 Type of products supplied

Plants and flowers

2.4.4 Market and justification

2.5 HVAC (air conditioner)

2.5.2 List of companies

Samsung Malaysia Electronics (SME) Sdn Bhd

2.5.3Types of product supplied

SamsungMalaysia Electronics (SME)Sdn Bhd York(Malaysia) Sales & ServiceSdnBhd

Mitsubishi Electric (Malaysia) Sdn. Bhd.

Acson Malaysia Sales & Service Sdn. Bhd.

Hitachi electronic products (m) sdnbhd

MOVEO Portable air conditioner

2.5.4 Market and justification

Degree of product differentiation

2.6 Sanitary fitting (WC)

2.6.2 List of companies

Claytan group c/o. Clay industries sdnbhd

Johnson Suisse (Malaysia) Sdn. Bhd

Saniton Ceramic (M) Sdn. Bhd

Potex Industries Sdn Bhd

2.6.3 Type of products supplied

2.6.4 Market and justification

Degree of product differentiation

2.7.2 List of companies

Gaya Murni Sdn Bhd

New Century Security Door Enterprise Sdn Bhd

Artilux Sdn Bhd

Big Bath (Kepong) Sdn Bhd

10 Market's Economic in Malaysia

10 Market's Economic in Malaysia