The Ratanpur Group – better known for its flagship company RSRM (Ratanpur Steel Re-Rolling Mills Ltd) — is now a second generation family business.
Two brothers, Maksudur Rahman and Md Younus Bhuiyan, started RSRM in 1986. In 1965, the two began their business by selling scrap iron.
Having studied abroad, Maksud's two sons, Md Mizanur Rahman and Marzanur Rahman returned home and joined the family business. They now manage RSRM — a leading steel manufacturing company in Bangladesh that directly employs over 800 people and has an annual turnover of more than Tk700 crore.
The company had to halt production for a year because of Covid-19, but it now plans to resume operations by September of this year.
The Business Standard spoke with RSRM Director Marzanur Rahman, who is also the public relations director for the Bangladesh Steel Manufacturers' Association, about the company's operations, the resumption of production, and future plans.
How has RSRM grown?
My father began with trading in scrap iron, the main raw material for steel. In his long business career, he gained experience about sourcing raw materials and we made spare parts.
Soon my father, a freedom fighter who fought in sector-2, thought it would be a good idea moving forward, to industrialise.
After independence, he thought he would work for the betterment of society, employ people, and bring real improvements to the economy with industrialisation.
He started the steel business in 1986 by the name of Ratanpur, the name of our ancestral village in Feni. We started billet-making in 2006 and our factories can now produce 700 tons a day.
What is the current condition of RSRM's business?
We have been in production for a very long time, but have recently been experiencing power sub-station problems since August 2020.
There were two issues: BPDB [Bangladesh Power Development Board] overbilling, and a separate technical issue. Unfortunately, we had to stop production, despite the fact that we had been doing well with quality production.
Steel is one of our specialties, and we provide steel for nearly all major government infrastructure projects. Our current focus is on how we can resume production with better management now that the problems have been resolved.
We have set up a system to forecast such production hiccups in the future. We've learned three things from this crisis: what needs to be done, what shouldn't be done, and how financial management should be done properly. Businesses experience ups and downs, which serve as learning opportunities. Our new management is working hard to regain the trust of our customers.
How did RSRM turn around?
In this field, we have 40 years of experience. We know how to recover from a crisis. We've seen many ups and downs in the last four decades, and we know what to do in a crisis.
How is RSRM dealing with the pandemic?
We coped with two crises at a time. One in the company due to a production cut-off and the other was Covid-19.
We have recovered from the power problems and our human resources have been restructured to cope with the Covid-induced crises.
To better manage our human capital, we have slimmed down manpower, having learnt how to develop relationships with customers digitally in the course of the pandemic.
What are the main products of RSRM now?
TMT 500W, TMT Bar, 60 grade, 40 grade, and all dimensions of steel from 8mm to 40mm — these are our products in the market. We have backward linkage industries like shipbreaking yards. From salvaged raw materials at the yards, we make billets, turning that into finished steel products.
Which segment is RSRM planning to expand in the future?
We want to expand production of our steel product lines in the future. The production range will be expanded to include angles, channels, and customised items.
We have already planned to expand our product range that will help save time and money in the construction industry. We will be implementing our plans very soon.
What are the prospects in Bangladesh for the steel industry?
Steel plays a direct role in almost all industries. Steel use and consumption are linked to a country's development, increasing GDP, increasing people's purchasing power, and decentralisation.
Since the government has taken up many projects, the consumption capacity of citizens has also increased. The steel market in Bangladesh will grow over the next 20-30 years as consumption is increasing. Bangladesh also has tremendous potential to export steel products to other countries, particularly in Africa.
Bangladesh's export market will be ready within the next decade, as many developed countries, such as China, are likely to cease steel production. Africa has huge steel prospects riding on increasing infrastructure development and we will have the opportunity to export.
The government here has also taken up several mega-projects including the Payra port and Matarbari port. Once complete, these ports will boost the country's exports and imports.
People, regardless of their national identities, need to build homes too. Buildings in the future will be multi-storied that require steel.
Do you have plans to export?
Yes, our ambition is to export our products as well. Going forward we will keep an eye on what type of steel demand goes up.
However, we recognise that we must also prioritise energy efficiency, green steel, and carbon emissions reduction. These factors will play a major role in increasing our presence in foreign markets. Keeping this in mind, we will expand or bring out new products to capture the export market.
Are RSRM products rust and salt tolerant?
Yes, our products are long-lasting and can cope with salinity. We have already addressed that issue in our product lines.
What is your academic background?
I graduated in mechanical engineering from Queen Mary University in the UK in 2009, and did my Masters (MSc) in Engineering Business Management at University of Warwick, also in the UK, in 2011. I have also done two internships — one at Jaguar Land Rover of Toyota in the United Kingdom and the second one at a steel mill in Aberdeen, UK. I returned home in 2012 and joined our RSRM factory as a mechanical engineer, moving on to working as director of operations and business development.
The company was run manually earlier, but I have changed it to a digital one. Standard Operating Systems (SOP) are being applied to all accounts. It took three years to restructure the company.
Why did you get involved in business?
Joining a business can be a passion, a way to make money, or a way to expand the family business. But my motives were different. I joined the family business in order to be successful in a sustainable eco-friendly company.
I want to develop a business that will no longer have to depend on its owners to run. RSRM should not be dependent on our children for the next 100 years.
As a business, it should be self-sufficient and run on its own for years to come. The family business stereotype needs to be broken. I want the formula family business to be a public limited company run by qualified people.
The goal I have for RSRM is to transform my family business into a multinational corporation.
What would you do if you were not in the family business?
If I did not join my family business, I would be a professional engineer. I would have been an expert in recycling. I believe a day will come when all resources will come from recycling and will have to be recycled.
In your spare time, what do you like to do?
I like to read the news: not only local news, but international news. I like to read in depth about companies, and I like to read biographies. I also like to read newspaper editorials that give me insight into different perspectives