contribution of aci motors to the agricultural development of bangladesh

“Contribution of ACI Motors to the agricultural development of

Bangladesh”

REPORT OF MBA PROGRAM, FACULTY OF BUSINESS STUDIES, UNIVERSITY OF DHAKA. 6TH OCT’16

Letter of Transmittal

6th October, 2016

To

Prof. Mojib Uddin Ahmed Ph.D.

Professor

Dept. of Tourism & Hospitality Management

University of Dhaka

Subject: Submission of the Internship Report on ACI Motors.

Dear Sir,

It is my great pleasure that we submit the internship report on “Contribution of ACI Motors

to the agricultural development of Bangladesh”

It was complicated topic to work because I didn’t have any prior knowledge about this

Agrimachineries Industry. But at the same time it was also a very interesting topic to

work. By doing internship at ACI Motors I have learned about the business strategy of an

Industry which was totally unknown to me. Working on this report also has given me a

good opportunity to apply my theoretical knowledge in the practical field.

I have tried my best to follow your guidelines and prepare this internship report in a

professional manner. But, obviously, there is also much scope of improvements. I hope that

you will consider my mistakes and lacking as a subject of learning. Your valuable feedback

will help me a lot in making this kind of report in future.

Sincerely yours,

Abdul Halim

ACKNOWLEDGEMENT:

At first I would like to thank the almighty Allah for giving me opportunity to

successfully complete my Internship Report. Then I would like to thank my Supervisor Mr.

Asif Faisal Rumy, Assistant Sales Marketing Manager, ACI Motors for teaching me all the

things that I needed to perform my work. After that my Sincere thanks goes to my

supervisor Prof. Mojib Uddin Ahmed,Ph.D. for giving me valuable feedback and proper

guideline to make a better report.

At last, I would like to thank all the executives, Managers, General Managers & Chief

Business officer of ACI Motors for providing me all kind of support during my internship

period.

DECLARATION OF SUPERVISOR:

This is to certify that the internship report on “Contribution of ACI Motors to the

agricultural development of Bangladesh” in ACI Motors ltd” submitted for the award of the

degree of Master of Business Administration from the Department of Tourism and

Hospitality Management, Faculty of Business studies, University of Dhaka, is a record of

research carried out by Md. Abdul Halim under my supervision. No part of this internship

report has been submitted for any degree, diploma, title or recognition before.

____________________

Professor Mojib Uddin Ahmed, Ph.D. Professor, Department of Tourism and Hospitality Management, Faculty of Business Studies University of Dhaka

DECLARATION OF THE STUDENT:

I do hereby declare that this internship report has been written by me during of 2016 under

the Valuable guidance of Saud Ahmed, Assistant Professor, Department of Tourism and

Hospitality Management, Faculty of Business studies, University of Dhaka, in fulfillment of

the requirements for the award of the degree of Bachelor of Business Administration (BBA).

I’m also declaring that I have not submitted this internship report for any degree, diploma,

title or recognition before.

____________________

Md Abdul Halim Roll: 26 MBA 7th Batch Department of Tourism and Hospitality Management University of Dhaka

EXECUTIVE SUMMARY:

For the completion of my MBA Program I have done my 3 month internship at ACI Motors

Ltd. ACI Motors established in 2007 as a subsidiary business of ACI Limited. ACI limited is

one of the largest and renowned congloromates in Bangladesh operating their business in

diversified sectors. ACI Motors is now marketing around all kind of agro machineries

including Tractor, power Tiller, Pump, Diesel Engine, Rice Transplanter, Combine Harvester,

Rice & wheat Reaper, infrastructure development machineries, & automobiles. In my

Internship at ACI Motors I worked in sales Department under the direct supervision of

Assistant Sales Marketing Manager, Mr. Asif Faisal Rumy. In this time I worked in developing

& implementing DMS (Dealer Management System) App & DMS Dashboard with the help of

MIS Team of ACI limited. I also maintained the Social Media site of ACI Motors, ACI Water

Pump & YAMAHA Bangladesh. Apart from this I also worked with designing, developing &

implementing DMS Web App for YAMAHA motorcycles Bangladesh. I have also developed a

sound communication with sales force team & dealers. In this report I have included the

history of Bangladesh agricultural industries & use of agricultural machineries.

BACKGROUND OF THE REPORT:

As a student of Business Administration at University of Dhaka it is

essential that we apply our theoretical knowledge in the practical work field. For this

reason we have to done an internship in a particular organization and submit a report to

prove that during the period of internship we were able to successfully implement our

knowledge in the work of our particular organization. After successfully submitting

report, we complete our Post-graduation. I have done my internship in ACI Limited at

ACI Motors division.

Table of Contents

1. BANGLADESH AGRICULTURE:.................................................................................................... 1

2. FARM MACHINERY INPUTS IN BANGLADESH AGRICULTURE:...................................................... 1

3. COMPANY PROFILE: ................................................................................................................. 2

3.1 ACI MOTORS LIMITED: ................................................................................................................ 2

3.2 MISSION OF ACI MOTORS: ........................................................................................................... 2

3.3 SPECIFIC OBJECTIVE OF ACI MOTORS: .............................................................................................. 2

4. PRODUCT PROFILE OF ACI MOTORS: ......................................................................................... 3

4.1 SONALIKA TRACTOR: .............................................................................................................. 4

4.1.1 HAULAGE: .......................................................................................................................................... 4

4.2 POWER TILLER: ....................................................................................................................... 5

4.2.1 COMPARATIVE ANALYSIS: .......................................................................................................... 6

4.3 DIESEL ENGINE: .......................................................................................................................... 7

4.3.1 MODEL OF DIESEL ENGINE WITH HORSE POWER: ............................................................................. 8

4.4 WATER PUMP ............................................................................................................................ 8

5. NEW MACHINERIES: ................................................................................................................. 9

5.1 REAPER: ................................................................................................................................... 9

5.1.1 COMPARISON BETWEEN MANUAL REAPING & MECHANICAL REAPING: .......................................................... 9

5.2 RICE TRANSPLANTER:................................................................................................................. 10

5.2.2 COMPARISON BETWEEN MANUAL REAPING & MECHANICAL TRANSPLANTING: .............................................10

5.3 COMBINE HARVESTER: ............................................................................................................... 11

5.3.1 COMPARISON BETWEEN MANUAL REAPING & MECHANICAL HARVESTING: ..................................................11

5.4 POWER THRESHER: ................................................................................................................... 12

5.5 CROP PRESERVATION: ........................................................................................................... 12

5.6 SERVICE & SPARES .................................................................................................................... 13

6. TARGET CUSTOMER OF ACI MOTORS PRODUCTS OR MACHINERIES: ........................................ 13

7. THE GROWTH OF AGRICULTURAL MECHANIZATION IN BANGLADESH ..................................... 14

8. RETURN OF USING AGRICULTURAL MACHINERIES: .................................................................. 16

8.1 BENEFITS OF AGRICULTURAL MECHANIZATION ................................................................................. 16

9. CONTRIBUTION OF ACI MOTORS: ........................................................................................... 17

9.1 DIRECTLY: ............................................................................................................................... 18

9.1.1 FREE SERVICE CAMP: ..........................................................................................................................18

9.1.2 CUSTOMER FEEDBACK PROGRAM:........................................................................................................18

9.1.3 PRODUCT ORIENTATION & TRAINING: ...................................................................................................19

9.2 INDIRECTLY: ............................................................................................................................ 19

9.2.1 CONTRIBUTION ON FARMER’S PRODUCTION: ..........................................................................................20

10. THE SPREAD OF AGRICULTURAL MACHINES IN BANGLADESH: ............................................... 22

11. SPREAD OF NEW AGRICULTURAL MACHINERY: ...................................................................... 23

12. SERVICE IS THE PART OF THE PRODUCT: ................................................................................ 25

13. ACTIVITIES: ........................................................................................................................... 25

13.1 MARKETING ACTIVITIES: ........................................................................................................... 26

13.2 CORPORATE SOCIAL RESPONSIBILITY: ........................................................................................... 27

14. AFTER SELL SERVICE SYSTEM OF ACI MOTORS: ...................................................................... 27

15. UNIQUENESS OF ACI MOTORS AFTER SALES SERVICE DEPARTMENT: ............... 28

15.1 PROVIDE MAXIMUM FREE SERVICE: ............................................................................................. 28

15.2 DOOR TO DOOR SERVICE: ......................................................................................................... 28

16. CONSTRAINTS AFFECTING MECHANIZATION OF ACI MOTORS: ............................................... 29

17. RECOMMENDATION: ............................................................................................................ 29

17.1 ESTABLISHED A SALES AND SPARE PARTS CENTER IN DHAKA: .............................................................. 29

17.2 STRONG MARKETING TEAM ...................................................................................................... 29

17.3 TAKE AGGRESSIVE PROMOTION ACTIVITIES: ................................................................................... 29

18. CONCLUSION: ....................................................................................................................... 29

19. REFERENCE: .......................................................................................................................... 30

Table of Figure

Figure 1- Direct Contribution .......................................................................................................................... 18

Figure 2-indirect Contribution ........................................................................................................................ 19

Figure 3-Percentage of employment in agriculture ........................................................................................ 21

Figure 4-Agricultural land in "000" acre .......................................................................................................... 22

Figure 5-The Spread of Agricultural Machines in Bangladesh ......................................................................... 22

Figure 6-New Machinery in Bangladesh ......................................................................................................... 24

Figure 7-Promotional activities ...................................................................................................................... 26

Table

Table 1-Comparative Analysis ......................................................................................................................... 6

Table 2-Diesel Engine with Horse power ......................................................................................................... 8

Table 3-Comparison between manual reaping & mechanical reaping ............................................................. 9

Table 4-Comparison between manual reaping & mechanical Transplanting .................................................. 10

Table 5-Comparison between manual reaping & mechanical Harvesting ....................................................... 11

Contribution of ACI Motors to the agricultural development of Bangladesh 1

1. Bangladesh Agriculture:

Total cultivable land 8505278 Hectare

Total irrigated land 7124895 Hectare

Cultivable fellow land 204366 Hectare

Cropping Intensity (%) 190

Agriculture contribution on GDP 16.33%

Total cereal production Rice : 33833603 M ton

Wheat : 1254778 M ton

Maize : 1547719 M ton

2. Farm Machinery Inputs in Bangladesh Agriculture:


3. Company Profile:

3.1 ACI Motors Limited:

ACI Motors start its operation from 6th November 2007 as a

subsidiary of ACI Agribusiness with an objective to market high quality farm

machineries like: Tractor , Power tiller diesel engine etc.

3.2 Mission of ACI Motors:

To provide complete farm mechanization solution to the farmers.

3.3 Specific objective of ACI Motors:

To become the market leader in the tractor industry of Bangladesh by 2016

To introduce new agricultural Machineries and related commodity for farmer

It has own sales and service center at Bogra, Comilla, Jessore,Barisal,Gazipur,Rangpur

,Sylhet and Dinajpur by which ensure highest quality after sales service, repairs and

spare parts. It also provides flexible credit facilities for farmers for better customer

satisfaction and service. ACI Motors are planning to introduce light commercial vehicles

like pickups and mini trucks to support farmers to carrying agricultural goods. Also, high

quality diesel engines and pumps for irrigation purpose will be offered in the near future.

This business shows considerable promise in contributing to the agricultural productivity

of Bangladesh.


4. Product Profile of ACI Motors: ACI Motors offers following product or agrimachineries to the farmers in order to

provide them a better solution in cultivation.

ACI Motors

Agri-Machineries

Tractor

Power Tiller

Diesel Engine

Water Pump

New Machineries

Crop Preservation

Service

Specialty Segments

Construction Equipment

CASE

ESCORTS

SCHWING STETTER

YAMAHA Motorcycle


4.1 SONALIKA TRACTOR:

Sonalika Tractor, introduced by ACI Motors in 2007 is the most reliable tractor due to its design

and superior after-sales service guarantee. Manufactured using modern technology, Sonalika

tractors are the optimum choice for cultivation and haulage in Bangladesh. Sonalika tractors

outperform other tractors of same Engine Horse Power, in all aspects; they can carry more

weight and cultivate more land. Their high quality powerful engines ensures continual

performance and do not require repairing for a long time. Our country-wide outstanding service

network provides on the spot service in only 6 hours.

4.1.1 Haulage:

Sonalika Tractors are the perfect combination of power and performance. They have more

speed, thus they can make more trips and increase income. The powerful engines enable them

to carry any heavy materials such as bricks and rods, even in rough terrains.


4.2 POWER TILLER:

ACI Power Tillers are the only ones in Bangladesh that are specifically suited for the unique soil

condition of our country. They have powerful engines with more Horse Power and larger blade

sizes that increase rate of cultivation by 20%. With 1 inch larger blades, they can penetrate

deeper into the soil, resulting in more crop production.

The customized technology, low-cost of operation, ease-of-use and durability ensures superb

performance and value for the long haul.

The Brass radiator prevents rust and keeps the engine cool, it is easy to weld

Dual- Fuel Filter ensures purity of the oil

Fitted with 4 Kg heavier Chassis and additional syn-fuel, which can endure tremendous

vibration

Iron wheels with 10 sprockets and 20 bits

R 24 has 8 mm glass wires, instead of standard 4 mm

Equipped with High-quality, durable Rotary chain, which does not malfunction or break

easily

Air Cleaner with more height, keeps away dust and mud, protecting the engine

Securely screwed seat instead of welding, which makes it stronger and long-lasting.

Powerful Hydraulic

Cultivates More Land

In Less Time

MORE CULTIVATION

BETTER FINISHING

BUMPER PRODUCTION

MORE INCOM

E

In 6 Hours, On The Spot Service Guaranteed!


4.2.1 Comparative Analysis:

Regular R 24 Kubota

Probable Price Tk. 1,20,000 1,40,000 1,80,000

Daily Cultivation ( 8hours ) 4 Acre 5 Acre 5.5 Acre

Daily Income ( Tk.750/Acre ) Tk. 3000 Tk. 3750 Tk. 4125

Daily Expenses

Fuel Tk. 612 (9 Ltr.) Tk. 612 (9 Ltr.) Tk. 476 ( 7 Ltr.)

Driver Tk. 400 Tk. 400 Tk. 400

Maintenance Tk. 50 Tk. 50 Tk. 50

Depreciation Tk. 571 Tk. 571 Tk. 321

Total Tk. 1633 Tk. 1633 Tk. 1247

Daily Net Income Tk. 1367 Tk. 2117 Tk. 2878

Annual Net Income Tk. 96,608 Tk. 1,48,160 Tk. 2,01,430

Return 80% 106% 112%

Minimum Duration 2 years 2 years 4 years

Total Net Income Tk. 1,91,320 Tk. 2,96,320 Tk. 8,06,720

Table 1-Comparative Analysis


4.3 Diesel Engine:

ACI Diesel Engines are designed to improve your performance and productivity. We have a

large range of engines that can be used for power generation activities in agriculture, brick-

fields and transportation.

Our engines are used in dredging, generators, oil machines, Nasimon, Korimon, trolley, power

thresher, hand power tiller, boats etc. and even in heavy duty activities.


4.3.1 Model of Diesel Engine with Horse power:

Models with 4 -10 Engine H.P. Models with 12 - 32 Engine H.P.

ACI CD HP ACI GN HP ACI DF Hand-starting, 160-220 Kg, 2200rpm Fuel Consumption < 238 – 271.2 g/Kwh

HP

R170A CD Water-cooled

4 S1100 GN Water-cooled

16 S 195 DF Water-cooled

12

Z160F CD S1100NL GN Water-cooled

16 S1100 A2 DF Water-cooled

16

Z170F CD Spring Type Air-cooled

4 S195 GN Water-cooled

12 S195 NL DF Condenser

12

ACI CF S195 L GN

Water-cooled (With Light) 12 ZS1110 DF

Water-cooled 20

R175A CF Water-cooled

6 S195 NL GN

Radiator

12 ZS1115 DF Water-cooled

25

R180 CF Water-cooled

8 ZS1100 GN Water-cooled

20 ZS1125 DF Water-cooled

28

R185 CF Water-cooled

8 ZS1115 GN Water-cooled

25 L32 Water-cooled

32

ACI EM

EM185 Water-cooled

8.5

EM185NL Water-cooled

8.5

EM190

Radiator (Light) 10

Table 2-Diesel Engine with Horse power

4.4 Water Pump

Manufactured using the latest technology, ACI water pumps ensure efficiency. Equipped with

100% copper wire coil and the appropriate engine horse power, ACI water pumps are reliable

and long-lasting. They have 100% brass impaler and high-quality bearings making them

soundless and auto thermal protector. They also have Stainless steel shaft and good quality

capacitor which can endure extreme heat.

We have Submersible Pumps ranging from 0.33 - 5.50 H.P. and 4 portfolios of Surface pumps-

ACI Jet Water Pump (ranging from 0.50 – 2.00 H.P.), ACI Centrifugal Pump (ranging from 1.50 –

3.00 H.P.), ACI irrigation Pump (ranging from 1.00 – 3.00 H.P.), Double Jet Pump (1.00 H.P.) and

Peripheral Pump (0.50 H.P.).


5. NEW MACHINERIES:

5.1 Reaper:

For harvesting rice and wheat, ACI Motors has introduced ACI Reaper, imported from Vietnam

and Taiwan. It has 5.5 – 6.5 H.P. HONDA Engines that runs on Petrol and fitted with tubeless

tires. It weighs 155 kg and can perform even in low muddy or water-filled lands. It is easy to

operate and requires no training.

ACI Reapers have a cutting width of 4 rows and can harvest 1.Acre of land in one hour,

consuming a liter of fuel only. The cutting height can be adjusted 6-35cm. ACI Motors give 1

year of Warranty with free after sales service.

5.1.1 Comparison between manual reaping & mechanical reaping:

Particulars Reaper Traditional

Labour 1 person 8 person

Time 1 hour 8 hours

Cost Tk. 255 (Labor Tk. 100 + Petrol Cost Tk. 100 + Depreciation Tk. 55)

Tk. 2000 ( Labour Cost - Tk. 250 per day)

Savings Cost : 75%, Time: 82%, Labour: 80%

Table 3-Comparison between manual reaping & mechanical reaping


5.2 Rice Transplanter:

To reduce the labor shortage problem, ACI Motors has introduced ACI Rice Transplanter, both

walking type and riding type. It has 4 rows and can transplant 1.5 Bighas of land in one hour,

consuming 500 ml of fuel only. Each tray carries 120-150 gm of seeds, 20 trays required each

bigha of land.

5.2.2 Comparison between manual reaping & mechanical Transplanting:

Rice Transplanter Traditional


Time 1 hour 8 hours

Cost Operations 100 Tk. 5400

Fuel 350

Maintenance 100

Transportation 250

Others 500

Total 1300

Savings Cost : Tk. 2970 ( 75%), Time: 81%, Labour: 88%

Table 4-Comparison between manual reaping & mechanical Transplanting


5.3 Combine harvester:

These machines can reap, thresh, harvest and package rice & wheat in one operation. It can

save crops by swift harvest during natural calamities.

5.3.1 Comparison between manual reaping & mechanical Harvesting:

Combine Harvester Traditional


Time 1 hour 8 hours

Cost Tk. 430 (Labor Tk. 200 + Petrol Cost Tk. 130 + Depreciation Tk. 100)

Tk. 3400 ( Labour Cost - Tk. 200 per day)

Savings Cost :74%, Time: 87%, Labour: 92%

Table 5-Comparison between manual reaping & mechanical Harvesting


5.4 Power Thresher:

For the threshing of rice and wheat, ACI Motors has introduced ACI Power Thresher,

manufactured using local technology. The machine comes in three designs – Head Feed Type

Open Drum, Close drum Power Thresher and Tractor Operated Thresher.

Equipped with wheels, transportation is easy. Preserves the nutritive quality of the seeds,

separation rate is 98%. Operation and maintenance is relatively low cost. Belt and other moving

components are covered, ensuring safety of the operator.

5.5 CROP PRESERVATION:

For the preservation of Rice, Wheat and other grains ACI Motors has introduced unique

technologies that can reduce economic loss and preserve dry agri-products using improved

techniques.

No harmful preservation Chemicals required to be applied.

Easy Transportation.

No separate infrastructure required.

Durability more than 10 years.

Works effectively in all types of weather.

Unique Design resistant to rat and similar animals.

Insects die due to lack of Oxygen.

USES:


Crop can be preserved in any type of bag or sack. Rice, Wheat, Pulses, Chilli, Dry Fruits

can be preserved.

GrainPro Cocoon

GrainPro Collapsible Dryer

Suncue Batch Dryer

Flat Bed Dryer.

5.6 Service & Spares We guaranty on the spot service in 6 hours only. Our highly trained manpower of 100 service engineers

and technicians are provided with motorcycles for mobility in all terrains. We have regular training

programs to make sure our technicians are adapted with the latest technologies. We also arrange

international training sessions in manufacturing plants of our products to ensure ultimate service

quality. For relationship building, free service camps, demo programs and driver trainings are regularly

arranged.

We have developed online service tools to monitor and evaluate our service programs. We have a

customer hotline to solve any queries and receive service requests.

We have eight own & four authorized 3S (Sales, Service and Spares) centers. We have 55 authorized

parts center to make certain spare parts availability throughout the country. For the power tiller

portfolio, ACI branded spare parts are available

6. Target customer of ACI Motors Products or Machineries:

An ACI motor has targeted different class or group pf people for their different product or

machineries. Science the price of tractor, power tiller combine harvester and Rice

transplanter is quite and it is quite hard for an individual farmer to buy. For this reason ACI

motors have targeted specific group of people. Like:--


Solvent farmers in a specific village who has quite a good amount land or under

which lots of small farmers works.

Businessman who want to invest money in new sector.

People who return from different foreign country and want to do a profitable

business.

Different NGO’S who work with farmers like: Asha, Dipsikha BRAC etc.

Dealers of ACI Seed, Fertilizer (especially for Power tiller, Rice cutter, Diesel engine

and sprayer)

However, price of Rice cutter, Diesel engine and sprayer is affordable to individual farmer.

So, for selling these products individual farmers are also targeted by ACI Motors.

.

7. The Growth of Agricultural Mechanization in Bangladesh

Bangladesh has the globe’s highest per-capita level of rice consumption at 172.6 kg person

year (FAOSTAT, 2015). The government of Bangladesh (GoB) has tended to encourage

mechanization as an avenue to increase rice production and move towards rice self-sufficiency.

To facilitate this process, the GoB voluntarily reduced import restrictions and tariffs on select

machineries, while also supplying subsidy to help purchasers offset fixed costs (GoB, 1999). The

GoB first introduced irrigation pumps and tractors in the 1960s (Ahmed, 2001). Four wheel

tractors were initially promoted, which are arguably scale-inappropriate in Bangladesh given

the small average farm size at around 0.53 hectares, which is often divided into multiple fields,

making demand aggregation for tillage services among farmers, and between-field and -farm

transport of tractor equipment problematic. The GoB also first introduced centralized

irrigation facilities by establishing deep tube wells (DTWs) and supplying low-lift irrigation

pumps (LLPs) to farmers on a rental basis from the Bangladesh Agricultural Development

Corporation (BADC). The GoB also supplied fuel at 75% subsidized rate to pump owners

through BADC until the 1970s. By 1978, BADC had rented out and managed a total of 9,000

DTWs and 35,000 LLPs (IDE, 2012).


Irrigation and land preparation management under nearly complete government control

however presented large logistical and financial burdens. Eight years after independence,

Bangladesh undertook liberalization policies, and as a result, the government gradually opted

out of state-led support of mechanization and began the privatization of irrigation, with

additional efforts to open markets for land preparation equipment (Gisselquist et al., 2002).

BADC initiated sales to liquidate DTWs and LLPs to farmers’ cooperatives and also to individual

farmers, many of whom became service providers. Privatization, however, only gained full

momentum when a number of tariff and non-tariff barriers on the import of irrigation and

diesel engines and tractors were eliminated, actions that were linked to disaster response

management by the Bangladeshi government.

On November 29, 1988, a cyclone with wind speed of more than 150 kilometers impacted

Bangladesh (UNDRO, 1988), taking a major toll on human lives, while also reducing the

draught oxen and buffalo population used for land preparation, with the deficiency estimated

at approximately 5.8 million animals, equivalent to approximately 132,000 tractors (GoB, 1989).

During this period, the GoB’s Standardized Committee was responsible for controlling the

quality of imported machinery, including agricultural equipment. They did so by advising the

import of high-cost Japanese tractors, pumps, and engines, while discouraging more affordable

Chinese made machinery thought to be of comparatively lower quality (Justice and Biggs,

2013). the urgency resulting from the cyclone and consequent threat to food insecurity

however prompted the GoB to reconsider such policies. In 1988, President Hussain

Muhammad Ershad voluntarily eliminated most of the major import tariffs on standardized

diesel engines and two-wheeled tractors, in order to facilitate the broader availability of two

wheel tractors and the associated 8-16 HP Chinese engines that drove them. In the next step,

President Ershad disbanded the Standards Committee, to facilitate the rapid import of

comparatively inexpensive diesel engines and two-wheeled tractors from China (Justice and

Biggs, 2013). Six years later, the import of two- wheeled tractors was made completely duty

free (IDE, 2012).

These actions resulted in a drastic increase in imports of small diesel engines for mechanized

irrigation and land preparation. The number of shallow tube wells (STWs) used for irrigation

increased from 93,000 in 1982 to 260,000 in 1990 (IDE, 2012). Currently, more than 550,000

two-wheeled tractors, the vast majority of which are made in China, are used to prepare 80%

of Bangladesh’s cropland (IDE, 2012; Ahmmed, 2014). A total of 1.63 million of STWs, DTWs

and LLPs are also used to irrigate (BADC, 2013) nearly 55% of all cropland (BBS, 2011). The

impact of these actions, in combination with other measures, appears to have had a dramatic


impact on increasing Bangladesh’s cropping intensity, or the number of crops grown per unit of

land per year. This is acknowledged to have been partly attributable to the spread of irrigation

(Hossain 2009), and which can be observed in national statistics (Figure 5) that indicate that

cropping intensity appeared to be stagnating until the late 1980s, and then began to gradually

but steadily increase as result of these actions.

8. Return of Using Agricultural Machineries:

Agricultural Mechanization, agricultural areas to develop all kinds of agricultural produce and

agricultural products evaluation process to fulfill objectives used with all kinds of energy

sources, mechanical tools and equipment design, construction development, distribution,

marketing, publishing, education, operation and use-related issues is included.

Agricultural mechanization is a production technology. In some countries, different levels of

mechanization and application development are. This difference can be monitored, especially in

the agricultural business. In other words, mechanization, agricultural business in each business,

depending on the technical and economic structure is being implemented at different levels.

8.1 Benefits of Agricultural Mechanization

1. To enable the new technology in production applications.

2. Production is dependent on natural conditions as possible to recover and to get more

qualified products.

3. Manufacturing operations in the most appropriate time to complete, without delay to avoid

losses resulting product.

4. Working conditions in rural areas more comfortable, attractive and safe to bring a case and

agricultural workers to improve work efficiency.

5. On the one hand, increase in agricultural products, on the other hand, developments in

agricultural tools industry with the opening of new jobs to the area to allow.


6. Human and animal agricultural operations cannot be achieved with power to machine

power, and new areas for agriculture and managed to make up.

Agricultural mechanization is the number of these benefits, if the conditions are inappropriate

and unplanned walk into an application that mechanization is some disadvantages. Unwanted

as the mind can sort.

1. All agricultural inputs for the largest share of mechanization have entered the car. Scale

mechanization is an important application, business plan creates installed costs.

2. Excessive mechanization result, unemployment in rural areas may increase.

3. Unplanned result of mechanization, the balance between agriculture and industry sectors in

the agricultural sector against damageable.

4. Usually based on vehicle fuel energy Mechanization works. Negatively impact the country's

overall energy balance plan for mechanization.

9. Contribution of ACI Motors:

From the establishment of ACI Motors it has been contributing our agricultural development in two

ways.


9.1 Directly:

First; because Bangladeshi farmers are not enough rich to buy agro machineries, so it’s tough to buy the

machineries for them. In this scenario, ACI Motors provides credit facilities to its dealers & installment

facilities to farmers. Besides this ACI Motors also provides training on appropriate using of machineries

so that farmers can get best return from the machineries. Company also provides some unique service

to its farmers.

Figure 1- Direct Contribution

9.1.1 Free service Camp:

ACI Motors offers “Free service Camp” in all over district gradually & provides

1. Discount on booking product

2. Discount on purchasing spare parts

3. Free health check up

4. Free servicing for all machineries

5. Product Presentation

9.1.2 Customer Feedback Program:

ACI Motors often organizes program for Customer engagement & they take farmers feedback after using

their product & services. Most of the time, Management takes all the feedbacks, complaints &

suggestions for developing the product discussing with the manufactures. Besides this they also arrange

different religious get together along with customer to celebrate. They recently launched a Hotline for

getting customer feedback 24/7. Hotline number 16509.

Free service camp

Customer feedback program

New Product &

training


9.1.3 Product orientation & Training:

Company often launches new product along with a gala program. They provide free training on how to

use machineries more effectively for more profitability. Company provides all kinds of spare parts to its

customer with reasonable price. Training helps farmers to use the machine accurately so that they can

have more return from it.

ACI motors launch new products in the agricultural sectors in Bangladesh like Reaper, Combine

harvester, Mini combine harvester etc. they creates new market for this machineries for the farmers

very first time in Bangladesh.

9.2 Indirectly:

Agricultural industry are grooming day by day in Bangladesh. ACI Motors introduces various kinds of

products in Bangladeshi farmers like Reaper & combine harvester. Beside this, company has also

ensured subsidies for the farmers on specific product like Reaper. Company also works as a

representative of farmers to the government & other NGO like TMSS. Company offers facilities to

different NGO so that they can help to farmers in rural area.

Figure 2-indirect Contribution

ACI motors

Farmers

Government


9.2.1 Contribution on farmer’s production:

Before using the reaper, rice harvesting per 1 ha took whole day with 8 people working on it.

Now with reaper, it just takes one hour with one person. It significantly reduced his labor cost

with more capacity to work. If we see few articles on the newspapers we can see that the main

problem is labor cost that is increasing day by day. The high labor cost is the main problem for

the farmers to bear expenses to make profit. With the current market scenario they cannot

afford high cost for the cultivation or sowing etc.

However, the actual farming was kept unchanged with traditional labor-intensive method.

Cultivating rice paddy with hoe, rice planting, removing weeds, harvesting, threshing, and rice

husking, all these farm work are done by hand. And these were the works of daily laborers and

poor women. It requires an enormous labor force to work on three cycles in a year.

But, this labor intensive-farm work is becoming difficult to keep. This is mainly caused by shift

of Bangladesh industrial structure. 37% of country’s GDP was from Agriculture in 1975, but it

declined to 20% in 2010 (jica.go), 16.33% in 2014 (bdnews24.com). This is the result of dramatic

shift of key industry from agriculture to secondary industry; especially to garment sector.

People in the village have moved to urban cities to seek better job.


Figure 3-Percentage of employment in agriculture

(Source) Decent Work country profile Bangladesh by International Labor office

This ratio express that the portion of workforce in the agriculture industry is declining & it will

be a burning issue for the agricultural industry in next few decades if we don’t progress with

the agricultural machinery support.

As a result, labor force in villages has declined significantly. A research conducted by

International Labor Organization (ILO) shows the population engaged in Agriculture in

Bangladesh has declined by 20 Percent in a decade during 2001 to 2016. This lead to increase of

labor cost in agriculture and nowadays it is difficult to find enough labor force. We even heard

that labor cost has increased fourfold in past five years. Agriculture in Bangladesh is suffering

from a serious shortage of workers.

Hundreds of years of traditional farm work have now reached to a major turning point.

Machinery usage in agriculture has begun. This movement has just started in a small scale, but

the wave of mechanization may change the whole land scape of farming in Bangladesh.

67

60 55

47.5 41

2001 2003 2006 2010 2016


Figure 4-Agricultural land in "000" acre

(Sources) survey by ACI Motors Planning Team

On the other hand the land of agriculture is declining year to year. In this situation ACI Motors

provides machinery to increase the agricultural growth of production.

10. The Spread of Agricultural Machines in Bangladesh: Usage of agricultural machinery has just begun in Bangladesh. According to JICA’s research,

among 40 million farmers through our country, only 1 % holds agricultural machinery. However,

it seems that momentum is stronger, beyond what we see in the statistics.

Figure 5-The Spread of Agricultural Machines in Bangladesh

(Sources) Internal SDMS Software

92800 92660

92530 92460 92410

91280 91200

91080

90000

90500

91000

91500

92000

92500

93000

2006 2007 2008 2009 2010 2011 2012 2013

0

2000

4000

6000

8000

10000

12000

2010 2011 2012 2013 2014 2015

Power Tiller Tractor Diesel Enggine


The company was established in 2007 with local investment. Since the inception, the company’s

sales volume has increased steadily every year. Now, is has more than 20 million dollars of

annual turnover.

The company sells agriculture machineries to local farmers. The products include tillers;

harvesters, tractor and rice reaper and these are all imported from abroad.

Tillers from China, Harvesters from Korea, Tractor from Indian And rice reaper from Philippine.

The company has eight sales offices nationwide with nice showroom each office.

According to the company, potential market size of agriculture machinery is around USD 600

million. The Company’s major product is power tiller which it sold 40,000 since the

beginning. They have also sold 120,000 diesel engine and 8,000 tractors. Combine which is

imported from Korea costs BDT 120,000 (around USD 17,000) and the Company sold 70 of them

already.

Throughout the country almost 40% of agricultural machineries are from ACI Motors. The

contribution of ACI Motors to the agricultural industry of Bangladesh is around 20%.

11. Spread of New Agricultural Machinery:

For the first time in agricultural industry Company has launched new machinery in the

agricultural sector of Bangladesh like Reaper, Harvester, Combine harvester, Mini Harvester,

Trans-planter etc. Company arranges subsidies for the farmers from the government on this

product.

A report presented during 3rd TAC Meeting of Asia Pacific center of agricultural Engineering &

Machinery held on Dec 2004 in Hanoi, Vietnam. Where they highlighted the demand of new

machinery in Bangladesh was


Machines for Harvesting Rice & wheat.

Machine for Transplanting Rice seeding.

Equipment for corn shelling.

Low cost & effective drying system for gains.

Because of high price in Bangladesh of these agricultural machineries farmers cannot afford this

& for this reason our farmers are losing their profit every year on high labor cost sometimes

shortage of labor. When there were around half of population were farmers in last decades but

now it has declined to 35-40% because of having loses in farming. With this scenario company

has launched these machineries in the agricultural sector of Bangladesh for the first time with

subsidies from government.

They are:

1. Reaper 2. Trans-planter

3. Harvester 4. Combine harvester

Figure 6-New Machinery in Bangladesh

(Sources) ACI Motors Internal Database

2011 2012 2013 2014 2015

Combine Harvester 2

Harvester 5

Transplanter 15 0 1 2 50

Reaper 4 8 39 92 587

4

8 39 92 587

15

0 1 2 50


The rice reaper costs Tk.12, 000 thousands (USD 1,700). In the case of rice reaper, Bangladesh

Governments gives subsidies of 30% of its sales price. Farmer will pay 50% upfront and rest of

the money will be paid in 6 month installment.

The buyers are not only rich farmers. The so called Local Service Provider who provides farming

services to the farmers as a business is the major buyers. With substantial reduction in labor

cost and improved productivity, local service providers can now make better profit. This gives

capacity to buy such agricultural machineries and payoff in short term. Company provides

credit facilities to these service providers.

12. Service is the Part of the product:

This company also put emphasis on after-sales services. They provide training for the buyers on

how to use the machine with operating manual, and they even provide free medical checkup

service for them. The company is trying to achieve loyalty from the customers as they are likely

to buy other products from the Company. In tractors they committed to provide service within

6 hours to the farmers around the whole Bangladesh. They have an organized service team

throughout the country that provides service 24/7. Even they provide one year replacement

guaranty for any kind of problem in the machines that cannot be solved. All the service

engineers are trained from importer country.

13. ACTIVITIES:

ACI Motors has a lot marketing activities throughout the year including social activities.

Company arranges a lot of program for the farmers in rural area like “Prity Football Match” at

Mohadevpur. In 2013 they arranged an Agricultural fair at Bangladesh agricultural University to


create awareness & inspiration among farmers & young generation. In 2008 they arranged

Agriculture fair at ACI Centre. In these all program & fair they always invited all popular

agricultural specialists & local Farmers.

13.1 Marketing activities:

Company provides various inspirational offers to the farmers as well as distributors. They

provide financial privilege to the poor farmers in local area. Best quality service & loyalty is their

main brand to promote with the machines. They often sit together with farmers & suppliers to

have feedback to change the product as the requirement of the farmers.

To promote the market they use word of mouth promotion from the customers. But with the

traditional trend they use

Facebook

TVC

Leaflet

Festoon

Figure 7-Promotional activities

Facebook 2%

TVC 8%

Leaflet 60%

Festoon 30%


13.2 Corporate Social Responsibility:

ACI Motors always beside the farmers all the time in any natural disaster or financial problem.

Company managed free cultivation or harvesting for the farmers with their modern equipment.

Company also provides EID gift to many farmers with packaging EID clothes & ACI Consumer

products. There is a helpline for the famers to inform about their problems & feedback about

the products & service.

14. after Sell Service System of ACI Motors:

In this Agriculture Machineries sector after sale service plays a vital role for building a

company’s reputation. Because of our country knowledge level of farmers or users about

using agriculture machineries is very low. For this reason ACI motors has built up a strong

after sales services and spare parts department headed with the service Manager, Service

Engineer, Service Coordination Executive, Senior and junior Mechanics. The main

objective of this department is to retain customer satisfaction. The total permanent

manpower of ACI Motor after sales service and spare parts department is 45. Apart from

these, ACI Motors also have some contractual mechanics. This department also gives

their Service Engineers and mechanics to participate in different training program organized

by Bangladesh Agriculture Research Institution where they learn how to operate and

manufacture different types of new and light agricultural machineries.

Apart from these Service and spare parts department of ACI Motor organized training

program for their service engineers and mechanics to increase their product knowledge and

efficiency. Training is given by the expert Indian Service engineer of sonalika tractor.

After selling of agrimachineries to customers Service engineer or mechanics of this

department provide practical training to the customers about how to drive tractor, power


tiller, how to maintain it properly, what should do and what should not to do etc. A

written Bengali manual is also given at that time.

For Tractor Service department of ACI Motors provide 1 year free servicing or free servicing

for using up to 1500 hours which one appears first. Customers receive free tractor

serving according to the following.

Slot:

1st service: after 50 hour

2nd service: after 250 hour

3rd service: 500 hour

4 t h service: 750 hour

5th service: 1000 hour



15. Uniqueness of ACI Motors after Sales service department:

15.1 Provide maximum free service: Free servicing facilities of Sonalika

Tractor start after 50 hours where other companies start this facility after 300

hour.

15.2 Door to Door Service: It is a unique service providing system of ACI Motor

after sell service department. In this system customers of ACI Motor give a call to the


service engineer or service Coordination Executive of his region and told his problem.

After that, Mechanic of that region will go to his house or mentioned place

according to the promised schedule. Here, the customer does not have to take his

machine or drive his machine to the showroom of his region.

16. Constraints Affecting Mechanization of ACI Motors:

Lack of Knowledge & Skill for efficient Use, Proper Maintenance and repair of machinery at all

levels of users.

Absence of any Public sector agricultural extension activity for demonstration involving farm

machinery, mechanization and post-harvest activities.

Poor quality of fuel, lubricants oil available in the village area.

Low tariff on imported machines and high tariff on spare parts and materials of fabrication.

Lack of knowledge of benefits of using machine in the agriculture.

17. Recommendation:

17.1 Established a Sales and spare parts center in Dhaka: Competitors of ACI Motors like TAFEE and Mahindra has a sales and spare parts center in Dhaka but ACI

motors don’t have any sales and spare parts center in Dhaka. For this reason customers who live

around Dhaka like: Norsingdi, Dhamrai etc face problem because for buying spare parts they have to go

comilla showroom.

17.2 Strong Marketing Team At present in ACI Motors are managing their sales in all over Bangladesh through only 9 territory

managers in whole Bangladesh. This 9 territory mangers have to cover 64 district of Bangladesh. Under

1 territory manger there are too many districts. For example: The territory managers of Jessore have to

cover 12 district which is very difficult for him mange and make proper concentration on each district.

17.3 Take aggressive promotion activities: As a new company ACI Motors is not attempting enough promotion activities as should be. They are not

giving any advertisement in TV and Radio but their competitors especially TAFEE is giving TV

advertisement of their tractor. ACI Motors should also increase their billboard advertisement in different

district.

18. Conclusion: To conclude I want to say that the boom of the company up to now is quite impressive. Now they are the 2nd market leader in Bangladesh within these 9 years become the Most Diversified Mechanization Company with Vast Product Varieties. ACI Motors is Pioneer in introducing Combine Harvester & Rice Transplanter in Bangladesh.


19. Reference: ACI Motors website: www.acimotors-bd.com

ACI website: www.aci-bd.com

ACI agribusiness website: www.aciagribusinesses.com

Ministry of agriculture: www.moa.gov.bd

Dept. of agriculture: www.dae.gov.bd

www.small-farm-permaculture-and-sustainable-living.com

http://www.acimotors-bd.com/

http://www.aci-bd.com/

http://www.aciagribusinesses.com/

http://www.moa.gov.bd/

http://www.dae.gov.bd/

http://www.small-farm-permaculture-and-sustainable-living.com/

contribution of aci motors to the agricultural development of bangladesh

Education