MKT3811: Construct an appropriate Integrated Marketing Communications (IMC) strategy for UMW Holdings to stay attractive to the business-to-business: Marketing Analysis & Decision Making Assignment, Malaysia


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MKT3811: Marketing Analysis & Decision Making

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Case Study

UMW Equipment Eyeing Growth Changing Trends in Business Creating Opportunities

An evolving economic landscape due to the Covid-19 pandemic has necessitated a rethink on how UMW Holdings Bhd’s unit UMW Equipment Sdn Bhd does business. Despite the challenges, UMW Equipment’s president Megat Shahrul Azmir said the group was optimistic of its growth prospects amid the ongoing changes in the business environment.

He told StarBiz: “Growth hinges on the various initiatives undertaken to expand the business, build resilience and increase productivity. We are further supported by our market leadership positions in various industry segments, strong product line-up, good support from principals and wide distribution networks.”

Megat Shahrul said market uncertainties stemming from the pandemic had compelled the company to focus on cost management strategies, as well as havingnconstant engagement with its customers to better understand their challenges and needs, and offer them viable solutions. “With the movement restrictions implemented across the region because of the rising Covid-19 infections, we have seen delays in projects that require the use of equipment.

Furthermore, the tightening credit conditions have made it even more challenging for customers to obtain financing,” he said. UMW Equipment’s president Megat Shahrul Azmir said the group was optimistic of its growth prospects amid the ongoing changes in the business environment.

“From a business development perspective, we have shifted our focus to areas of the economy that were less impacted by the pandemic, and we have been targeting the essential services sector,” he added.

He also said there have been new opportunities brought about by the continuing pandemic and UMW Equipment is working on capturing more of these. “Due to the shift in business processes and operations, some of our customers are now willing to invest in new technologies to automate in improving productivity and reducing their dependence on human labour,” Megat Shahrul said. He said the company’s products catered to these changes in this landscape. In the agriculture sector, for example,

Megat Shahrul highlighted that there was a shortage of foreign labour at the moment. “Hence, there is a need to speed up the mechanisation for plantation players. To support the acceleration of this process, we have a full range of products to cater to the customers’ requirements for both heavy and industrial equipment in the full value chain in the agriculture sector,” he said. Megat Shahrul said that in this respect, UMW Equipment would like to become a total solutions provider for the agriculture industry in terms of heavy and industrial equipment needs.

On a related matter, Megat Shahrul said the company was also presently experiencing an increase in demand in the equipment rental business. “It allows us to manage the customers’ material handling requirements with an
optimum fleet size, models and specifications. The customers are then able to focus on their core business,” he said. The option for its customers to rent equipment also lets them manage their short-term costs.

“Most of our customers are in the manufacturing, food and beverage, logistics and warehousing sectors,” Megat Shahrul said. He noted the company’s heavy equipment division would also be driven by the infrastructure projects that had been announced in Budget 2021. “The funds were allocated for projects such as the Mass Rail Transit 3, Pan Borneo Highway, Rapid Transit System Johor-Singapore, the Klang Valley Double Track and Gemas-Johor double tracking.

For Sabah and Sarawak, we are focusing on supplying government projects in infrastructure development such as water supply, electricity, roads, healthcare facilities and education,” he said. “Although the current challenging environment as a result of Covid-19 may delay the kick-off of these  projects, we believe it would drive demand for equipment once they start,” he added. Over the longer term, Megat Shahrul said UMW Equipment remained fully focusedbon becoming a total solutions provider in its industry, with the aim of becoming the market leader in the region.

According to UMW Holdings’ exchange filing, the equipment segment’s revenue rose15% to RM332.5mil for the first quarter ended March 31, 2021, mainly due to higher demand for products and services for both the local and overseas operations. The segment accounted for about 11.3% of the group’s revenue for the period in review.

In the same statement, UMW Holdings said the performance of the industrial
equipment sub-segment was expected to be sustainable as it focuses on growth sectors as well as extending various recovery packages to its customers to remain

competitive in the emerging post-pandemic economy. With the rising e-commerce adoption spurred by the Covid-19 pandemic, the sub-segment could benefit from the improving demand for warehouse equipment, it added.

1. Construct an appropriate Integrated Marketing Communications (IMC) strategy for UMW Holdings to stay attractive to the business-to-business segment as the company moves forward and plans to be the leader in the industry during the Covid-19 pandemic.

2. Construct an appropriate growth strategy for UMW Holdings equipment segment post-pandemic.

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