In one minute, one million plastic bags are in use around the world and in Europe, plastic carrier bags are produced 3.4 million tons in a year and average European uses about 500 plastic bags per year that takes 100s of years to degrade and not only contaminates the environment but also directly impairments many living organisms. Bangladeshi scientist invented jute poly bag using jute cellulose that is bio-degradable and bio-plastic in nature, which is substitute of conventional poly bag. It will play a significant role in concern with environment, temperature, air, soil and sea pollution as well as the opportunity to retain the glory of Bangladeshi jute in international market and farmers to keep smile. In the paper, we will analyze international marketing strategy, product positioning, competitiveness and potentiality in international market through SOWT, marketing mix & porter’s five forces analysis. Our observation that newly invented jute biodegradable poly bag will gain market share in international plastic & bioplastic industry as well as the potential market for exporting all over the world and especially in Europe and North America. Bangladesh has both absolute and comparative advantages in producing jute poly bags.
Jute is a cash crop of Bangladesh and the glory & fame of golden fiber is fading gradually due to lack of jute diversified product and competiveness of market with supplementary products. Since last five decades, plastic industry has been dominating jute market by attractiveness, diversity, longevity, and user-friendly as well as cheap compared to jute made product. On the other hand, jute industry could not be able to compete with plastic industry for the lacking of government support, more concentration on plastic industry all over the world, lack of environmental awareness and research on jute diversified products, which are the main reasons of losing glory and fame of jute industry. But by the blessing of people awareness, the situation is gradually improving, which has great concern about the global warming, soil pollution, sea pollution, huge wastage management cost and threatening for animals planets. According to a New York Times article, only plastic bag is used each year 100 million to a trillion but the surprising that only small portion of these bags are recycled takes about 1000 years to go moldy.
Polyethylene bags are the most common plastic bags that are made from crude oil and natural gas. Both oil and gas are nonrenewable energy sources, meaning that they are in limited supply. On the contrary, jute is natural and renewable as much as needed ensuring fresh air and environment. There are a few alternatives of plastic poly bag that is, jute, cotton, canvas, non-woven and bamboo bags which are a safer alternative to plastic bags but all are not convenience as plastic bag in use for bringing liquids and warping wet foods. But in right time, Bangladeshi scientists are able to invent substitute of poly bag as the same strength. The happiest news that scientist had already been able to produce bio-plastic from algae has huge positive impact, rather than uses of corn to produce bio-plastic.
Bangladesh National Jute Fair (2017) [
The plastic is derived from natural materials rather that from crude oil or petroleum and it could be bio-degradable or non-bio-degradable. So, the jute poly bag is made of bio-plastic that is bio-degradable (two to three months). Through the analysis we focused on world bio-plastic industry and positioning the newly invented jute poly bag as well as finding the appropriate market and marketing strategies.
In Bangladesh, many jute factories have already been closed to overcome overhead cost but now by the invention of eco-friendly jute poly bag and by getting the opportunity to enter in highly demandable bio-plastic industry, the fame and glory of jute could be retained. As moving to new industry, the analysis will be focused on analysis of world bio-plastic demand and prospect of Bangladesh jute poly bag as well as specify the target market and find the answer of important question:
1. What are the strength and weakness of Bangladesh jute industry?
2. What are the competitive factors in international bio-plastic market?
3. What are the recommendations to get market share in bio-plastic industry?
4. What will be entry mode in international market?
5. Which market segment has potentiality for Bangladeshi jute poly bag?
The main objectives of this study:
1. To find a strategic way to introduce jute poly bags in international market.
2. To understand capacity of Bangladesh jute industry.
3. To find best entry mode in international market.
4. To recognize target segment of potential customers.
5. To assess the competitive factors Bio-plastic industry.
6. To classify the proper strategies for successful intervention in international market.
To meet above objectives, here we draw a conceptual framework that will help us to understand the variables that helps to gain market share in international potential markets.
Jute poly bag is an innovative as well as value added product that helps to gain market share. Economics of scale helps to gain market share through mass production and minimizing overhead cost to maximize profit. On the other hand, knowledge on exporting jute diversified product (JDP) in international market will help to maintain supply chain efficiency and lastly, the available raw materials in production in demand will also help to gain economic scale in product and operations and finally to gain market share.
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Figures 5-7 Bangladeshi scientist Dr. Mubarak Ahmad Khan, presently working as scientific advisor of Bangladesh Jute Mills Corporation (BJMC) and former Chief Scientific Officer of Bangladesh Atomic Energy Commission invented a biodegradable and eco-friendly bag from jute cellulose.
It seems to Poly Bag [
According to Dr. Mubarak Ahmad Khan the product could be used in garments packaging, food packaging, cover ice-cream, readymade garments, rice, sugar and even dairy milk. They have tested for a long time to test quality change and contamination but there was no contamination or quality problem. That means the bag is not harmful for human health.
Energy and Gold Ltd. (2016) [
In
ethylene and a by-product of gas or oil refining, these types of bags are fully recyclable but do not biodegrade. Low Density Polyethylene (LDPE) branded bags and used as “boutique” bags at stores selling higher value goods at department stores. LDPE is manufactured from ethylene, a by-product of gas or oil refining. Like HDPE, LDPE does not biodegrade.
Bangladesh invented jute bio-degradable poly bag (Jute cellulose) are similar to bio-plastic and high & low density, that is bio-degradable as well as compostable (two-three months). So, the bio-plastic industry will be the main competitor of the product and other industry conventional [
MA Jalil, MN Mian, MK Rahman (2013) [
Rahima Akter (2015) [
According to plasticbagfreeday.org (2017) [
Daily Sun online newspaper (2017) [
CPD Occasional Paper Series (2011) [
Textile today (2017) also reported on Jute poly bag discovered by [
Thegardian (2010) reported that [
Throughout the research, we use descriptive analysis using SOWT analysis to find out strength and weakness of Bangladesh jute industry and Bio-plastic industry competitiveness analysis with Porter’s five forces model and 4p’s of marketing mix concept. All data are collected from secondary sources i.e. Organization of Plastic Bag Free World, Plastic Industry Association of Washington, Indian Jute mills associations, Smithers Pira, Bangladesh Jute Mills Corporations, European commission online website, Online magazine Packaging Strategies, Energy and Gold Ltd., Daily-Sun newspaper, the largest petrochemical market information provider―ICIS, One line newspaper Textile Today, The Guardian, Thailand Board of Investment, Biotic organization of Thailand as well as article of different journals.
Through the SWOT analysis we have observed that the strengths of Bangladesh are fertile land for jute production, experienced farmer and friendly weather for jute cultivation, low labor cost ($68) [
Research & Market (Biodegradable Plastics Market by Type, 2015) Biodegradable plastics market in the global is still youth and accounts for less than 1% of the overall plastics market. The latest market data study by European Bio plastics shows that wrapping remains the largest fields of application for bio plastics with almost 40% of the total bio plastics market in 2016. The data also confirms a significant amount of acceptance of bio plastics materials in many other sectors, including consumer goods (22%) and applications in the automotive and transport sector (14%) and the construction and building sector (13%), where technical performance polymers are being used. In bio-plastic industry there are a few well known producers for example Solegear Bioplastics (SGB.V) which has developed proprietary high-performance bio-plastics that it customizes to produce finished end user products and packaging. Another big producer, Solegear which has taken a different approach from other bioplastic companies by using an outsourced production model to lower overall costs, deliver capital efficiency and global distribution. Metabolix, Inc. (MBLX) has developed and commercializing speciality high-performance biopolymers based on a PHA platform (polyhydroxyalkanoates) that also are an environmentally sustainable alternative to petroleum-based plastics. In this industry entry barrier is moderate due to huge capital investment and government support is needed to gain market share. But exit barrier is high as huge investment in technology and in production.
Siam Commercial Bank, Thailand (2014) [
Bangladesh bio-plastic poly bag is the substitute of conventional plastic poly bag and some bio-degradable poly bags. But all over the world countries are discoursing in using, producing and distributing. Many countries have already banned plastic poly bags China, India, Somalia, Uganda, Rwanda Botswana, South Africa, Kenya & Ethiopia including Bangladesh [
The PLA (poly lactic acid) segment is the highest growing segments in the biopolymers market. PLA is one of the commonly accepted biodegradable polyesters and can be synthesized using either renewable or non-renewable routes that is water-resistant and decomposes within three weeks into the industrial composting process. That’s why PLA is used in the packaging sector and textile industry. In terms of materials, the global bio-plastics market is segmented as bio-PET, bio-PE, bio-PA, bio-degradable polyesters, PLA & PLA blends, starch blends, PHA and others. But still PLA producing is costly [
Technavio (2016) leading vendors in Bio-plastic market are BASF, Nature, WorksArkema, Novamont, Plantic. In addition to big brand owners including Danone, Coca-Cola, PepsiCo, Heinz, Tetra Pak, Unilever and L’Occitane in the packaging market, or Ford, Mercedes, VW, Toyota in the automotive market have launched or integrated bioplastic products [
Farmers are the producer of the raw jute that is purchased by some intermediaries and sales to spinners, mills, exporter of raw jutes and farmers also directly sale to jute mills. In between some government agencies monitor the price and transactional activities. So, there are very few changes of increase barging power of jute producer in a sudden. In the content of Bangladesh, supplier bargaining power is avoidable.
The figure shows (
and conventional plastic industry that in the bioplastic industry the plastic wastage goes to manufacturer for reusing or it is goes to green field to decompose without any environmental hazardous. In Bio-Plastic industry agriculture sector is the key input player in value chain where renewable source and eco-friendly raw materials are used to produce bio-plastic. In Bangladesh Jute will be used to produce bio-plastic poly bag that is a natural plant which helps to environment to balance CO2. Jute cultivation is dependent on the climate, season, and soil. Almost 85% of the world’s jute cultivation is concentrated in the Ganges Delta. This fertile geographic region is shared by both Bangladesh and India (mainly West Bengal). As the invented bio-plastic poly bag will be made from raw jute cellulose for that the farmer could directly supply to factory without intermediary. Then finally the target retailer and brand owner will be food packing industry that uses near about 40% of global bio-plastic production in national and international market. In the end the consumed product is recycled by the natural way without or less impact in environment.
As a Least Developed Country (LDC) [
As the green field of the bio-plastic production in Bangladesh therefore very few chances to relocate the green field plant to other countries due to availability of raw jute, low labour cost, fertile land and government support. So, the best way to get access in international market through export marketing that could be direct and indirect exporting.
Innovation is the best idea of gaining market share in international market by finding the market gap and taking cost leadership a company can gain monopolistic business opportunity. The product that Bangladesh going to offer in international market that has the quality and opportunity to attain market leader hip specially in packing and poly bag segment in both conventional and bioplastic industry. The main ingredient of the product is jute cellulose and biodegradable synthetic polymer as binder that is very similar to Poly Bag but in actuality the bag is made by jute it has same potency of polythene bag that is 100% eco-friendly, recyclable and will be merged with soil within 3 - 4 months.
By organizing and participating in international trade fair. Pay attention to international media about the new innovation and offering to environmental and health benefits. Using more in readymade garments and foods packing that is exported to international market.
Price of the product would be less than or similar the conventional poly bag but not more than bioplastic poly bag. As the poly bag will be made from jute and Bangladesh is number one exporting country of JDP. So, it will able to get the challenge of cost leader ship in international market.
From domestic market to export destinations, there are four more members― transporting agencies, shipping companies, freight forwarders, wholesaler/ distributors in export market, retails or small shop and finally customers. The best way is to use same distribution channel that is used for JDP and readymade garments to export world market.
There are a few alternatives of plastic poly bags which are as convenient as poly bags. A few companies are producing bio-degradable poly bags that are made by crude oil and natural gas non-renewable sources which are not bio-plastic. Bio-plastics are made from natural sources basically collected through cultivation in green field, though it is contradictory of gaining benefits because of crop production [
The strength of Bangladesh, one of the highest jute producing countries of the world, farmers are well experienced to produce high quality jute and the newly invented jute poly bag that is a value added product which will help to gain global market share. We also found that the main competitors are PLA producing countries but still producing PLA (Ploy lactide acid, Corn starch) is costly that’s why in the past many start-up companies were not able to sustain in long run but some organizations are producing & marketing all over the world by getting help from government and environmentalist. Through the competitive analysis, we understand that there are monopolistic markets for Jute poly bags and negligible threat of substitute as well as bargaining power of supplier and consumer that will not affect all due to world demand and supply which is still a far way to get equilibrium.
Bangladesh has sufficient knowledge in exporting jute & readymade garments all over the world for a long time especially in European Union where she gets duty free export opportunity mostly in all products and we suggest focusing EU to get cost leadership in known market at first phase. We also suggest concentrating on Asian market especially in India and China though this market will be competitive in near future due to availability of resources in corn starch production where forecasted that China will be a leader in Asian as well as world market in producing corn starch. Most of the currently [
Branding and marketing through international media and more participation in international trade fair demonstrate the benefits and usefulness.
To strengthen absolute advantage, Bangladesh should encourage and support SME’s to get more involvement in production and distribution. Product diversification, usefulness, low pricing strategy are the most important to sustain in international market. Furthermore, investment in research and technological improvement should be taken in consideration to get economics of scale in innovation, production and operations.
As the product is newly invented and still in production phase for that, the details of usefulness, customer acceptance, quality of the product and final production capacities to meet demand are still not tested. One of the big challenges is insufficient data to measure and forecast future adaptability. In future, research could be conducted on customer acceptance and environmental effectiveness of newly invested poly bags and on how to get involvement of SME’s in bioplastic industry to strengthen absolute advantage where as huge investment and research required compared to conventional plastic industry. In conventional plastic industry, many SME’s are involved in production and marketing but in bioplastic industry, SME’s involvement is still a big challenge.
Pavel, S. and Supinit, V. (2017) Bangladesh Invented Bioplastic Jute Poly Bag and International Market Potentials. Open Journal of Business and Management, 5, 624-640. https://doi.org/10.4236/ojbm.2017.54053