Maruti Final

8/10/2019 Maruti Final

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ncrease in customer numbers, spare parts and service business is creating reliable revenues and conside

ACKNOWLEDGEMENT

MA%&#I & &(I I)*IA "IMI#+*A%+ A%#

$ A))+" MA)A +M+)#

/y-

Aman rivastava &M01234

Amiya Arnav &m01250

Anish Avinash ahu&M01256

%a7esh (umar anda&M01020

aurabh aul &M01028



A successful pro7ect can never be prepared by the singular e9orts but it alsodemand the help and guardianship of some conversant person who under pinactively or passively in the completion of a successful pro7ect. :ur pro7ect would nothave taken the present form in the absence of the invaluable guidance, inspirationand cooperation from many people.

;e take this opportunity to e<press our deep gratitude to rof. (rishna *as uptawho have given us the opportunity to present this pro7ect and continuouslymonitored us to perform well.

;e also e<press our thanks to Mr. $haran /iswal from )arayani Motors, #heauthori!ed Maruti u!uki *ealer= Mr. )aresh (umar )anda from &tkal Auto+nterprise vt. "imited= uspa Motors and >itu Motors for providing us with valuabledata which made our eld study successful.

?inally we e<press our cordial thanks to our friends for their unmatched support andguidance throughout the pro7ect preparation.



TABLE OF CONTENTS

IntroductionMaruti u!uki India "imited @M I" isone of the most successful stories in



supply chain and logisticsmanagement in the Indian automobilemarket. :ver the years it has workedto convert obstacles intoopportunities. M I" was incorporatedon ?ebruary 61, 04B0 with the nameMaruti &dyog "imited. #he companywas formed as a governmentcompany, with u!uki as a minorpartner, to make a people's car formiddle class India. :ver the years, thecompany's product range haswidened, ownership has changedhands and the customer has evolved.In :ctober 6, 04B6, the companysigned the license and 7oint ventureagreement with u!uki Motor$orporation, >apan. In the year 04BC,the company started their productionsand launched and rolled out the rstMaruti B22 on 01th *ecember, 04BC.

M I" India "imited @formerly Maruti&dyog "imited is India's largestpassenger car company, accountingfor over C4 per cent of the domesticcar market. #he company is asubsidiary of u!uki Motor $orporationof >apan. #he company is engaged inthe business of manufacturing,purchase and sale of motor vehiclesand automobile spare parts. M I" havesi< plants, three located at urgaon,

aryana and other three located atManesar Industrial #own, aryana.

Maruti u!uki manufactures and sellsa complete range of cars from theentry level Maruti B22, Alto, to thehatchback %it!, $elerio, $ia!, A- tar,

wift, ;agon %, en and sedans * ire,(i!ashi and D1, in the '$' segment+eco, :mni, Multi urpose vehicle

u!uki +rtiga and ports &tility vehiclerand Eita.

#he ultimate goal is to think that$ustomer is the (ing. It has its wide

repercussions to the promotions, salesvolume, and lastly the brand.

;hen one studies the revenue Fow forthe company, almost 81G of it issupported by its $ustomer $areservices which include the service,spares and services marketingproducts. #he industry is prone tocycles of boom and recession and asseen through almost 02 Huarters of from 6206 to 6201 car sales largelyremained sluggish. #he companieswere were Huick to reali!e thataftermarket foundations need to bereally strong. In the e9ort towards thisgoal, the channel management of spares becomes vital towardsorgani!ational success.

#he C model of any automobilecompany involves ales, ervice and

pares.

As of C0 March 6201 Maruti u!uki has4CC dealerships across 333 towns andcities in all states and union territoriesof India. It has C,232 service stations@inclusive of dealer workshops andMaruti Authorised ervice tations@ MA in 0,181 towns and citiesthroughout India.It has C2 +<press

ervice tations on C2 )ationalighways across 0,1C3 cities in India.

Service is a ma7or revenue generatorof the company. Most of the servicestations are managed on franchisebasis, where Maruti u!uki trains thelocal sta9. :ther automobilecompanies have not been able tomatch this benchmark set by Maruti

u!uki. #he +<press ervice stationshelp many stranded vehicles on the



highways by sending across theirrepair man to the vehicle

:ne of the prime support to such awide network is the Maruti Sparesdivision , In a Maruti u!uki, over62,222 parts come together and work

in perfect harmony. +ach part isfactory- tted, conforming to Hualitystandards. In due course, wear andtear with conseHuent replacementsand repairs happen. #hen every singletime the car would reHuire spares toreplace the worn out parts.

ource M I" Annual report 6206-620C=Juarterly

%eport ended >une C2, 620C= Juarterly%eport ended

eptember C2, 620C.

M I" is increasing its infrastructure foroutbound vehicles and for spare partsdistribution. #he company is movingtowards Khub-and-spokeL distribution

models for vehicle and spare partsthrough regional vehicle and partsdistribution centers @E*$s and *$s .M I" Integrated the supply chain tomeet customer reHuirements and ful lldemand in the market. M I"Ls purposeof building hubs is to reduce leadtimes for spare part and vehicledeliveries from days to hours.



OBJECTI E #o understand the spare parts channelmanagement at Maruti u!uki India"imited in :disha with respect to/hubaneswar.

MET!ODOLOG" #he research is based on the eldstudy conducted to collect datathrough survey method by visitingdistributor, dealer, single brandretailer, multi brand retailer in/hubaneswar.

SIGNIFICANCE OF

T!E ST#D" Maruti u!uki India "imited has been amarket leader in the India AutomobileIndustry. #he research attempts tostudy the channel managementimplemented at *ealer, distributor and%etailer level.

SO#$CES

%& Dea'er(Nara)ani Motors*& Distri+utor(#t,a' Auto

Enterprise -vt Li.ited/& Independent $etai'er(-uspa

Motors0& Mu'ti Brand $etai'er(Jitu

Motors

-$OJECT DETAILS #he automotive aftermarket is thesecondary market of the automotiveindustry, concerned with themanufacturing, remanufacturing,distribution, retailing, and installationof all vehicle parts, chemicals,eHuipment, and accessories, after thesale of the automobile by the originaleHuipment manufacturer @:+M to theconsumer. #he parts, accessories, etc.for sale may or may not bemanufactured by the :+M.

#he aftermarket encompasses partsfor replacement, collision, appearance,and performance, including electricpropulsion. #he aftermarket provides awide variety of parts of varyingHualities and prices for nearly allvehicle makes and models.

$onsumers have the option of repairing their vehicles themselves@the do-it-yourself segment or can

take the vehicle to a professionalrepair facility @the do-it-for mesegment . #he aftermarket helps keepvehicles on the road by providingconsumers the choice of where theywant their vehicles serviced,maintained, or customi!ed.



%ight ,art %ight,lace

%ight#ime

%ight,rice

#he escalating Indian auto.o+i'eindustr) has indirectly inFuenced thee<pansion of the auto spare partssector in the country. India is steadilysurfacing as an international

outsourcing destination for producingdi9erent automotive components.?irms like Eolvo, #oyota, *aimler$hrysler, yundai, etc are sourcingtheir auto spare parts from di9erentautomotive makers of India.

India as a 1'o+a' Auto Spare -artsManu2acturin1 3u+

Indian parts After Market is nearly 8

/n N. :ver the years, Indian Autopare arts sector has witnessed a

slow yet steady growth of around00G .Its share of $ar pare artsIndustry- C1G. Around C.B Mn $ars

erviced +very Month.It has emergedas the preferred manufacturing hubfor auto components due to variousreasons. ome of them are

#he long-establishedmanufacturing industry of India

"ow-priced workforce and easyavailability of raw materialsmaking India cost competitive

• :perational units of leadingglobal auto component makerslike Meritor, Eisteon, /osch, etcin India

• /oth auto makers and autocomponents makers haveestablished their International

urchasing :Oces @I :s in thenation

• ;orld class Huality auto sparecomponents are manufacturedin the country

• %esearch and developmentactivities are conducted in Indiafor global rms like >ohnson

$ontrols, *aimler $hrysler,u!uki, eneral Motors, etc.

;ith rising vehicle models andvariants and increasing customere<pectations, there is a need foreOcient spare part operations forreduction in rising costs.

Maruti u!uki India rivate "imited@ M I"

Almost 82G of revenue of Maruti issupported by its $ustomer $areservices which include the service,spares and services marketingproducts. Many a stalwart were Huickto reali!e that after marketfoundations need to be really strong.In the e9ort towards this goal andtapping rural market Maruti came upwith Maruti enuine arts.

M I" believes in pare arts Mission

Pour car is one of the Eital investmentmade by you, then why go for 7ust anyother part. &se only MA$#TI



$hannelManageme

nt

Inventory

Manpower

*elivery

;arehousing

GEN#INE -A$T because 4Ever) -artis ita'4

Maruti u!uki India "td. @M I"provides replacement of parts under

the brand 4Maruti Genuine -arts ,popularly known as M . In Marutiu!uki, over 62,222 parts come

together and work in perfect harmony.+ach part is factory- tted, conformingto our Huality standards.

In due course, wear and tear withconseHuent replacements and repairshappen. Maruti enuine arts ensurethat your car remains like the original,down to the smallest part.

+ach part is checked for Huality, re-checked and then checked once more.:nly then will our engineers clear apart for sale to you. In fact, we oftenconduct Huality inspections at ourvendor units also. All to ensure thatyou get parts 7ust like the original.

Maruti enuine arts are easilyavailable through our nationwidenetwork of dealer workshops, servicestations, Maruti enuine artsdistributors and retail outlets atreasonable prices, which further addsto the 7oy of owning and driving aMaruti u!uki. Maruti enuine artsare precision engineered to the design

Q speci cations of the speci c model,hence gives best performance in yourvehicle.

Maruti enuine arts @M are the

only certi ed parts for Maruti u!ukicar. #hey bene t you in the long runand enhance your car's performancebesides saving your hardened money.

#hese parts are tested under variousconditions depending on the type Qfunction of parts.

C3anne' Mana1e.ent

M I" $hannel Management consistsof

Inventor)

#he management of inventory can

have a ma7or impact upon thepro tability of an organisation. If inventory levels are too low then thereis the risk of stockouts, i.e. theinability to meet an order. #his canresult in a loss of revenues, pro ts andcustomer goodwill. :n the other hand,if the inventory levels are too high



then the organisation can e<periencecash Fow problems since so much of its capital is tied up in stocks. ;heninventory levels are high then there isalso an increased risk of spoilage,

pilferage and obsolescence.

M I" follows the following approachesto inventory management

Auto.ated Orderin1 S)ste.+ased on consu.ption

#his system ensures availabilityof ervice arts. ;henever theinventory falls short of areHuired level, it makes sure

that there is adeHuate levelavailable. It is not humandependant and is cost eOcient.

$ea'(ti.e In2or.ation F'o5 6Dea'er Mana1e.ent S)ste.

#his system helps in givingfaster response to customersand helps in better Q Huickdecision making thereby savingtime and money and ensuringbetter customer satisfaction.

Ware3ousin1 #he functions of warehouses areto provide cost-e9ectivestorage, in suitable conditions,for the organisation's productsand materials. #he e<istence of a warehouse is 7usti ed by thee<tent to which it contributes tothe eOciency and e9ectivenessof physical distributionfunctions.M I" believes in optimisationand bringing eOciency by beingfocussed and bringingstandardisation in warehousing.

tandardisation in layout andmaterial storage and materialeHuipment would help inoptimising space utilisation and

reducing the movement of labour, eHuipment andproductsRmaterials to aminimum. It focuses on :ptimal&se of +<isting torage Area

and 022G :ne art :ne"ocation.

De'iver)It uses more than C2222 Active

#ouch oints serviced regularlyusing branded delivery Eans Q 6;heelers. *elivery is done bytrucksR trainsR air transportbased on the time period androute followed.

E7c'usive $etai' Out'etIt o9ers uniHue buyinge<perience to its customers byfair Q transparent transactions



and bringing peace of mind andproviding customer education.

It provides e<clusive brandingfor all %etail :utlets. :n anaverage More than 02,222$ustomer are being served dailythru these :utlets.

Manpo5er

M I" focusses on giving itsemployees proper developmenttraining for auto spare parts.?ocus is on ;arehouse QInventory Management, arts:perations, oft kills 8

Manpo5er S,i'' Eva'uation isdone with ob7ectives of understanding training needsand skill upgradation and%ecognition of $hannel #alent.

C#STOME$ED#CATION

#here is nothingcalled a pare

artS.. +very art isEital.TMG- targeted popular medium like

#elevision, leading maga!ines andnewspapers and made popular %adio

>ingles to promote it and educatecustomers about the use of genuinespare parts.

.

opular #elevision Ads



rint Media

%adio >ingles

Also M has made investment incertain speci c areas to promote thebrand. :ne can clearly see the Mlogo in almost all the retail outletsbesides the Maruti u!uki logo

ome of the other promotionalactivities which are dedicated towardsbrand building e<ercise are #- hirts of M for people at the front end of thesales, M stickers on vehicles comingat garages, attractive spares manual.

:nline channels such as the oOcialM websitehttp://www.marutisuzuki.com/maruti-genuine-part.aspx and online resellingportals such as :"D.com,spareshub.com and carba!aar.cometc. are also present.

B#SINESS C!ANNEL NETWO$K

Maruti u!uki pares business channelpartners comprises of dealers and thedistributors. #he gure elaborates thecomplete channel structure for sparesdistribution. #he distribution networkis based upon franchisee model withM I" taking the role of a advisor andhelps in training and development of resources.

:+M i.e. Maruti u!uki rivate "imitedcaters to both retail as well as thedealer service network. #he retailnetwork starts with the *istributorwho is responsible for the sparedistribution to rest of the channelnetwork. M I" assigns on an averagearound C distributors to the speci cterritories in a state depending uponthe volumes. #hese distributors arethen the responsible for the MarutiAuthori!ed ervice $enters @MA ,Independent %etailers and Multi /rand%etailers.

http://www.marutisuzuki.com/maruti-genuine-part.aspx






M I"

*I #%I/&#:%

+%EI$+$+)#%+

I)*+,+)*+)#%+#AI"+%

M&"#I /%A)*%+#AI"+%

*I #%I/&#:%:;)+*

%+#AI"+%

*+A"+%

Maruti has better penetration in spareparts market than others while it o9erslower margin compare to othercompanies. M parts are testedRveri ed by maruti before coming tomarket, so they en7oy moreauthenticity. ;ith competition now

coming from )on-M products=channel distribution will hold moresigni cance in future.

M I" has now tied up also withgarages directly. ;ith the motive toincrease penetration of markets, thismove is the desired ones. arages forlong have been the most reliable

centers and making sure that theyprovide genuine Maruti spares iscrucial. #hese garages are tied up withthe help of distributors who areassigned point of contact for them.

DEALE$

Nara)ani Motors is one of the threeMaruti u!uki Authori!ed *ealersoperating in /hubaneswar. #he keyrole of pare parts is to be asupporting function for the *ealer

ervice division. #he dealersL are Cfacilities which mean they have ales,

ervice and pares facilities at theiroutlets.

ervice forms an integral part of theafter sale market and an importantsource of revenue. Increasingly thedealers have come to reali!e thatgood service can give immensepromotion to sales through word of mouth and e<perience.

Business Mode'



The business model as e<plained to uswas

#he dealer when in reHuirement of spare part places the order to Maruti

u!uki ead oOce in urgaon. "et usassume this to be *ay 2. :n *ay 0,the goods are allocated by the the

ead :Oce. *ay 6- icking andInvoicing is done at head oOce level.:n day C, goods are dispatched by%oad transport from urgaon back todealer. #he dealer with proof of delivery releases the good to

warehouse and issue Material receiptnumber. #he warehouse collects thegoods and sends it to nal customers.

)arayani Auto places order weeklybasis on every thurday in a month.

Turnover and Mar1in

#he dai') turnover of )arayni Auto isnearly %s B8222 per day. Mar1ins aregiven only from company. ro tmargins for dealers allowed are %%98

Inventor) Mana1e.ent

Dea'er

-OD-roo2 o2

Maruti !eadO:ce

Frida)A''ocation

M$NMateria'

$eceiptSat

-ic,in1; Invoicin1

Bin Location<Ware3ouse&

Custo.e

T3ursda)Order -'aced

Sunda)Dispatc3 +)Transport



pare ,arts Manager

$ollects 3 monthsLconsumption data in e<cel

?ilters /ig- mallconsumption Huantity=

$alculates total Huantityconsumed

58G U ?ast62 G U Medium

8G U low

*ealers have been provided with a*M @*ealer Management latformwhich acts as the interface for all thetransactions. It calculates andestimates the demand based on

consumption data being uploaded inthe system by dealers all over. :rderis generated automatically from thisestimation call Auto :rder ystem@A: . Around 1222 part line itemswere available with the dealer. #hepart line items are managed under?ast moving, low Moving and AverageMoving categories. Around 52G itemare the fast moving items, with 62Gand 02G belonging to medium andslow moving parts respectively. #heMaruti Automatic %eplenishment

ystem @MA% is designed in such away that automatic replenishment ispossible as soon as the inventory leveldrops below the speci ed levels. In thesystem these items are tagged as :ldItems. Increasingly M I" has beenputting pressure to have as manyitems as possible under :ld partcategory so that the o9take fromdealer is high. MA% is a state of theart techniHue developed rst by Marutiin Indian market.

:n an average 18 days storageinventory is maintained. #he per dayinventory level maintained is %s.12lacs.

$ompanyLs sa'es person acts asmediators between customers anddealers. ales guys are the :$s for

customers and often any problem orneed of customer is conveyed to thesales person who in turns passes onthe message to the dealers.

#he strategy to rope in local garages,increase in the M retailers doesnLtprovide Huick %:I for the dealermanagement. Although the dealer isstill able to work at enough capacity.

Transit Da.a1e

#he damaged goods are identi ed andpictures of the goods are sent to theMaruti head oOce in urgaon alongwith speci c information like cartonnumber, %, invoice and part detailsetc.



0 V * a m a g e d . o o d s I d e n t i e d = , h o t o s o f

s a m e s e n t b y m a i l

6 V $ a r t o n n u m b e r V . % n u m b e r @ t r a n s p o r t

n u m b e r V I n v o i c e n u m b e r V , a r t n u m b e r

C V M a r u t i * e a l e r R - e a d : O c e . u r g a o n

-ro.otions &sually spares arepromoted in ervice campaigns andthere are no speci c promotional toolsused. At the workshop end, postersand standees have been put up. /utthe concern from the spares point of view is the numbers of thesepromotional items. :ne has to searchfor them. #he discount section is alsoa plain vanilla stu9. Absolutely nodiscount is entertained either for asingle customer or for bulk purchase.

Credit -o'ic) and Mar,etin1Strate1)

)arayani Motors follows a +%: creditpolicy as the same is followed by M I"towards the dealers. ItLs a cash andcarry business. #he dealer needs tomaintain certain <ed balance againstwhich the billings are done. ;ithMaruti the preferred institutional

supplier, the dealer is focusing onpare clauses in their end to end

maintenance contracts. #his assuressustained vehicle inFow and alsospares usage. ince there is no head

to head competition for the division inthe open market, the strategy is to getaligned to the bigger service strategy.

#hough the management sees thebiggest competitors being the

purious suppliers @duplicate parts inthe market which are available both inHuantity as well as low price.$ustomer education and awarenessprograms have been designed whichare being communicated duringservice schedules.

Banners outside the Dealer’s shop

Team member at the touch point

Distri+utor

In India three companies @Mahindra, #ata and Maruti give after alesservice. ;hen it comes to spare part



distribution business, distributor playsa ma7or role. &nder Maruti enuine

pare arts, there are B6 distributersin India. )ormally, in a stateLsdistribution territory is divided

between one or two distributors. In:disha, there are two distributors and&tkal Auto +nterpriser vt. "td is thema7or distributor doing business in 60districts .All the distributors areappointed by Maruti. &tkal Auto+nterpriser vt. "td has started itsbusiness in 6200. It procures all thespare parts from Maruti. It maintainsorder cycle of 5 days. It has anautomatic order system . +very weekregularly-used@$ategory-W:ldX spareparts are ordered automatically whichforms 4CG of inventory. /ut someparts are also ordered manually basedon temporary demand. ometimes itprocures spare parts from dealers onemergency. It has two warehouses=one in ambalpur and another in/hubaneswar. It has also C retailoutlets in /hubaneswar, /arhmpur and%ourkela. owever, it provides sparesparts to Maruti Authori!ed ervicecenters, independent garages,independent retailers and directcustomers .It sends spare parts toMA , independent garages,independent retailers by truck and itbears the transportation cost. It doesa daily business of 6.8 lacs. It has Csales e<ecutives, 6 operational

managers and one chief operationalmanager. Maruti has 60 car models,around 062 variants and 31222-52222spare part lines. ence, Inventorymanagement is the key challengefaced by distributors. &tkal Autoenterpriser keeps around 5222 partlines. Another key challenge is to

spread awareness about M @Marutienuine arts since M has not

been penetrated in market to a largee<tend. *ue to customer unawarenessMaruti pare parts market consist of

12G M and 32G non-M , whichare spurious parts sold as M inmarket. #he ales of &tkal Autoenterpriser grew by 6BG last year.

#his year it has target to grow its salesby C6G and a sales growth of 6BG isalready achieved. It maintainsinventory for 12 days while companystandard is 18 days. It was able tobreak even in 620C-6201.

Credit -o'ic)=

$redit olicy to the customers isbasically dependent on their pastrecords and their loyalty to thecompany. #he two types of creditstructure which the company followsare *AP structure and *+/# structure.

#his credit policy is available to networth customers.

0 ?i<ed *AP structure provides B Gdiscount to the customers. In thispolicy weekly payment has to be doneby the customer on a particular day of the week. #he upper limit of the creditgiven to any customer is decided onthe basis of past track record. upposewe have to devise a credit policy for



ne<t si< months for a customer, so thiswould be based upon past si< monthrecord of that customer in case of payments. "et us assume if thecustomer has purchased goods of total

amount 06 lakhs in last si< months sofor future weekly credit allowed isbased upon this formula

> .ont3s 6 1 weeks each month

#otal of 3 Y1 U *0 and purchasedamount of last si< months Z %* 'a,3s

o upper credit limit of each weekfor ne<t si< months would be U 06lakhs R 61 U $s8?@@@@

*& ?i<ed date tructure provides a 3G discount to the customers and it is 6G less because customer has to payonly twice a month, once in 08 days.In this policy twice a month paymenthas to be done by the customer on08 th and C2 th of each month. #he upperlimit of the credit given to any

customer is decided on the basis of past track record. uppose we have todevise a credit policy for ne<t si<months for a customer, so this wouldbe based upon past si< month recordof that customer ."et us assume if thecustomer has purchased goods of totalamount 06 lakhs in last si< months sofor future monthly@ twice a monthpayments is based upon this formula

3 months Z #wice payment each month

#otal of 3 YC2U 0B2 days andpurchased amount of last si< months Z06 lakhs

o upper credit limit of each monthlypayment for ne<t si< months would be@0622222R0B2 Y08 U 022222.

#he limit on credit amount isautomatically set by business monitortools.

Transportation

Maruti sends material through trucks

from urgaon. ometimes through airin case of emergency if the Huantity isless. *istributor pays against bankguaranty. Maruti pays for thetransportation. Maruti provides acredit of C4 days for spare parts.

To esti.ate t3e si e o2 order thereare more than 31222 part lines in M .82-32G part lines are only availablewith distributor. *ue to customer backorder it loses C-1 lacs sales everymonth. #hat is why it puts additionalorder in every week based on last 3-4months data in order decrease thisloss.



#here are 1 groups of spare parts

a O'd old continuously in lastC-1 months, standard deviationis less, contains 4CG of

inventoryb A+nor.a' = *emand Fuctuates, high standard deviation

c Seasona'd S'o5 .ovin1=

ystem @/usiness monitor toolprovided by Maruti suggestsorder for old tagged items inevery week.?or the rest, order is givenmanually by considering many

factors like turnaround time,lead time, average consumptionetc.

$e(orderin1 is done normally 1 timesin a month @;eekly . #here is anoption of emergency order which wasnot used by &tkal Auto enterpriser inlast 3 months. In case of emergency,sometimes it procures spare partsfrom local dealers.

Discounts and Mar1ins

+<tra discounts is given only to keycustomers on meeting annual target U.8G

Margin is based on types of part lines.

a low moving @ ighest marginb Medium Moving@medium

marginc ?ast moving@least margin

#he transit insurance is done by thedistributor.

-ro.otion

romotion ometimes $ompanyshares costs

a leaFets are distributed to publicb $aps with logo@Merchandises

are distributed to arage boysc ifts are calendars to customers

and retailersd ?ree un shades with logo are

given to customerse $ustomer education programs

through hoardings and "$*screens

f Maruti Authori!ed ervice$enter Meets- Pearly :nce

g "ocal garage Meetsh romotion in retailer shop--

*isplay of M and spuriousparts together with completeknock down view of the partwith detailed descriptiondanglers by Maruti.



$etai'ersMaruti retail outlets are the mostconvenient places for customers toprocure maruti spare parts since theseare strategically located inside city.

#here are C types of retailers

A. *istributer owned outlets/. Independent retailer - single

brand$. Independent retailer - Multi

brand

Distri+utor O5ned Out'ets=

#hese retail outlets are owned bydistributers. #he one we visited isowned by &tkal Autoenterpriser vt"td. located on $uttuck road near?alcon house.

It maintains 6222-6822 part lines and

orders daily based on paste<periences and customer order.*istributer use to deliver spare partsdaily according to order. *aily theentire sales amount @%s 02222-08222is deposited to distributer. *aily orderis delivered by #ata Ace or Maruti:mni . #his retail outlet started withan investment of %s 682222 before C.8years. 42G of its inventory is

consisted of fast moving part lines. In620C it used to sale %s 622222 permonth. In 6201 , the sales revenuehas increased to %s 122222 permonth. It used to place all its caraccessories items in front rack so thatcustomer can spot them easily. 02-08garages and 02 retailers use to takespare parts from it regularly. It has 6sales persons. It does not have creditsystem and it only gives C-8Gdiscount to key customers. 6-Cgarages are tied up with it .

romotion

a. /y giving gift , key ring andwatch to customers on purchaseof %s 02,222-08222.

http://www.cars4indians.com/research/car_research.asp?rid=8






b. If a spare part is not availablewhile customer demands , itgives e<tra 6G discount if customer waits for 61 hours,with in which it gets the partdelivered.

#wo key challenges

a ome garages prefer using nonmgp parts as they get moremargin by using non- mgpparts.

b A local independent retailerwhich takes parts from thesame distributers forces it not

to give discounts. It is aconstraint since those localindependent retailers are thecustomers who buy regularly inbulk.

)ame of the person Nares3 Ku.arNanda

Independent $etai'er=

#hese are retailers set up their ownbusiness but sell only maruti spareparts. #he one we visited, i.e, uspaMotor sells only M . It is located on$uttuck road in front of "a<misagarsHuare. It buys spare parts from &tkalAutoenterpriser daily . :rder si!edepends on past e<periences.*istributer pays for transport. It doesnot have any credit policy. It buys the

material from distributer on datecredit system and gets 3G discount.;hile selling it makes a pro t marginof CG. It does not get anyguarantyRwarranty on spare parts. Itmaintains around 8222 part lines. Itdoes not promote at all. It maintainssales growth of around 5-BG P:P .

#wo key challenges

a. *istributer is selling directly inthe market.

b. "ess old cars nowadays sincepeople nowadays e<change

their old cars and buy newones.

Mu'ti Brand $etai'er=

#hese retailers sell spare parts of multiple brands. #he one we visited,i.e., >itu Motors located on $uttuckroad near />/ )agar. It sells spareparts of Maruti and yundai. It buysmarutiLs spare parts regularly from

&tkal Autoenterpriser on need basis.:rder si!e depends on paste<periences. It pays instantly and gets3-BG discount form distributer of maruti. It also buys non ZM marutispare parts from di9erent vendors,where it gets more margin,replacement warranty and credit of 18 days . owever, it does not getreplacement warranty from authori!edmaruti distributer. It has very few partlines of yundai since yundai doesnot have distributer in :disha. Itmaintains maruti spare parts and

yundai spare parts in ratio B 6. Itgives 6-CG discount to its customers



and achieves sales growth of 02G P:P.

Maruti has better penetration in spareparts market than yundai whilemaruti o9ers lower margin compare toother companies. It has around 1222

part lines of maruti which areconsisted of fast moving items.According to owner of >itu motors,there are not much di9erence betweenM and )on-M parts of maruti interms of Huality although M partsare testedRveri ed by maruti beforecoming to market , so en7oys moreauthenticity.

(ey $hallenge

a. #here are few part lines whereM en7oy monopoly and hencerate of these parts Fuctuatessigni cantly.

Conc'usion

#he eld study has helped in gainingvaluable insight into channelmanagement. #he channel structurefollowed is one which is similar to theindustry standard, the practices at thedealer level too is more or less similaracross the other brands too. /ut thekey di9erentiators for M I" in theirspares /usiness is there MA% supportwhich is one of its rst kinds. /eingthe rst mover in the I# enablement ,M I" has successfully createdconvenience and con dence among itsstakeholders.

#he marketing strategy followed in theregion has not been innovative as awhole but in bits and pieces. #here isfocus as well as e9ort but sincevolumes have been Huite high theneed for creativity hasnLt come in. /utin order to remain competitive in themarket with cut throat competitionM I" needs to set benchmarks in

pare parts too like one followed in%Q* and sales.

%ivals like #ata Motors and yundaihave already seen mobile platform asthe potential game changer and apotent tool towards brand building andcustomer education. *edicated pares



application have been developed sothat customer has the details in a fewtouches. $ustomer retention is beingdone through *elight cards on whichcustomers earn points on everypurchase of spares or lubes and whichcan be redeemed.

;ith growth forecast stated for Indiaand the car segment penetrationbeing still low among many developedand developing countries, spares

business can e<pect hugeopportunities in future. /ut it isaltogether important for M I" to takespares along with the sales growth tohave an added impact and e<cellentword of mouth.

Maruti Final

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Transcript of Maruti Final