Professional Documents
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Around 1,400rural outlets have been created in towns with populations of 25,000 and below.
The current dealer network of Bajaj is servicing all these outlets. Bajaj is convinced that the real impetus of future twowheeler growth will come from upcountry rural India.
Fifty two such stores have been opened across the India.
Catering to demand in this sector requires a strong and effective distribution network as consumers are more demanding and expect delivery on time.
Materials
Frames Tires Locks and Ignition Systems Headlamps and Lights Brakes ,clutch and Cast vehicles Digital Meter and Plastic parts Ignition system and switches Wires and cables Brake shoes, Brake lining and Clutch Centre
Process of ordering:
Bajaj follows a systematic process in selecting suppliers and deal with them. Production manager of the company study the application received by the suppliers and select proper suppliers as per their requirement. The selected suppliers invite for general meeting with the production manager and purchase manager of the company. In this meeting they decide conditions and time period of supplying raw materials to the company.
Process of ordering:
Once the contract is signed by both the parties routine work continues. Whenever the company required raw material they send e-mail or call the suppliers just three days before requirement in advance. Within two days company gets raw materials. The payment done after getting the raw materials on the basis of the cash or cheque. If the suppliers are unable to provide raw materials then Bajaj immediately inform them and getting solution.
The suppliers gets up-to date information on purchase order, contracts and material schedule
Inventory policy Bajaj auto maintains seven days inventory . Demand Estimations are based on Panel Regression, which takes into account both time series and cross section variation in data .
All the Mediators are connected with each other through IT linkage to know exact status of delivery of goods
Manufacturing:
With operations spanning to such vast geographies, managing a value chain globally becomes more and more complex. In countries where Bajaj perceives a strong market potential, they establish a tie up with one major industrial establishment eager to invest in the project.
This investment may include setting up strategic manufacturing or assembly units, apart from a well-established nation-wide network for marketing , distribution and after sales services.
These investors who form alliances with Bajaj Auto are termed as Business Partners. Bajaj Auto offers a number of services to its business partners
Manufacturing:
They include:
Training in sales, service and spare parts management based on the Bajaj distribution system Active support for setting up manufacturing facilities overseas including transfer of technical know-how
Assistance in setting up an assembly plant for assembly of vehicles from complete knocked down (CKD) kits
Manufacturing:
Selecting of machinery and equipment and training of technical personnel, all in a phased manner as required by the regulations in the recipient country Active support in setting nation-wide dealer network, also involving identification and recommending suitable partner who would assist the distributor in Business growth
Manufacturing:
Manufacturing locations: Akurdi, Pune, 411035
This is one of the oldest plants of bajaj auto ltd with production capacity of 0.6 million vehicles/ year. The plant has been closed in order to equip for four wheeler production Bajaj Nagar, Waluj Aurangabad 431136 This is second plant with production capacity of 0.86 million/ year. Products manufactured here are Kristal, XCD and platina and commerial GC series.
Manufacturing:
Chakan Industrial Area, Chakan , Pune 411501 This is the biggest plant of bajaj auto Production Capacity of 1.2 million/ year , Product manufactured here are pulsar and avenger and commercial Ge series
Pantnagar , Uttarakhand
The most advanced plant of bajaj auto .It has Capacity of 0.9 million vehicles per year. Product manufactured here are platina and XCD
Manufacturing:
Distribution Channel:
Various players involved in the channel design are: Manufacturing Plants Depots Carrying & Forward Agent Dealers Sub Dealers
Distribution Channel:
Logistics Channel Design is dependent on the segmentation that Bajaj have done in the geographicand product category segments.
Infrastructure facilities:
Bajaj Auto Ltd. has well designed infrastructure facilities. They highly care of clarity and arrangement.
The whole plant has divisional area like, offices, operation house, godown, and packing department.
Bajaj Auto Ltd. l has modern technological machines; from this it can produce products. This machinery arranged in operation department systematically. The production process is step by step so as per the machinery arranges Bajaj provide all the best facilities to their employees, like parking, canteen, rest room, and also proper working conditions. They greatly care of their employees. They pay on monthly basis and also give bonus on special occasions.
Infrastructure facilities:
For distribution bajaj auto uses mix of depots and C&f agents. This is completely dependent on the distance of manufacturing location from dealer point .
For example due to extensive distance from manufacturing plant from west Bengal to north-east India, there exist a depot in Khadakpur with capacity of housing 800vehicles.
There are similar depots in Punjab, Rajasthan and southern India.
Depots:
Setting up depots is a geographical strategy adopted by Bajaj Auto. But this does not mean that the company has gone all out to open a large number of depots. It has chosen strategic locations. The key role played by depots is that they are meant to cater to any sudden rise in demand of vehicles, and to cover the existing geographic span of India. When we spoke to the management, they explained to us the reasons behind having a depot in Kharagpur. There are two reasons for which Kharagpur was chosen to hold a depot for Bajaj Auto.
Depots:
They are as follows:
Catering to a sudden shooting up of demand- In Bengal itself, it is common knowledge that during the festive season which spans from September to November, there is a huge demand as people spend more on festival extravaganza and it is considered an auspicious time to buy household gadgetry. There is a conspicuous rise in the sales of white goods, motor vehicles and jewellery.
Depots:
Reaching the states of the North-East- As per the people at Bajaj, We take 15 days to reach the North-East if we go via the carrying and forwarding agent concept. Generally bikes reach West Bengal in 7-8 days. The bottleneck is the Darjeeling route. Hence, came in the concept of a depot whereby we can reach the North-East in the same time, instead of experiencing a lag of almost a week.
Dealers:
Like mentioned above, the company has a network of 498 dealers and over 1,500authorised service centers and 162 exclusive threewheeler dealers spread across the country. Around 1,400 rural outlets have been created in towns with population of 25,000 and below. The current dealer network is servicing these outlets. Dealers can be classified under 3 heads.
Dealers:
COCO
These are Company Owned & Company Operated showrooms. These concepts exists only for Pro-Biking showrooms. Bajaj Auto has tried showcasing their muscle power in high end biking segment. The concept has evolved very fast and now there are 52 Pro-Biking showrooms in the country. The company itself does not take any order from the customer in these showrooms. The giant dealer of the region who is acting as a logistics partner for the probiking concept takes the order on behalf of the company and fulfils the customer requirement.
Dealers:
CODO Codo
These are Company Owned & Dealer Operated showrooms.
In case of this concept ,showrooms are owned by the company but the operations in the showroom are managed by the dealer. This is generally the case where Bajaj wants to provide the dealer financial benefits considering the high working capital requirement of the company.
Dealers:
DODO
These are Dealer Owned & Dealer Operated.
These dealers are fewer in number because they are generally the giant dealers who are the financial muscle for the company. In our talks, the management indicated that the top management wants to do away with this concept. The reason behind this is that the bargaining power increases in the hands of the dealer, which puts the company in a knotty situation.
Sumit Transport
In year 2000 Project 110 percent was launched to spear head Bajajs growth in the future.
Bajaj auto has linked 386 dealers out of 498 and 165 suppliers out of 198 Business information is available to company external community in real time.
Order Tracking:
Taking a daily account of the order received from various dealers and Regional Offices (RO). Orders from dealers are punched in by dealer themselves. Orders are followed up in the system only if the credit limit is not crossed. This credit limit is preset into the system depending upon the dealer and his/her track record.
Packaging:
Packaging in factory is outsourced to third party vendor. These vendors are generally from the Transport & Logistics partners
Dispatching Goods:
Goods need to be dispatched via third party vendor TCI. State corporations and other private players are also part of the vendor list
CUSTOMER DETAILS
Types of Customers: Bajaj Auto ltd. produces goods by considering the different types of customers. They distribute products in small towns of the country and all over the world. The bikes lights produce as per the current trend of the customers.
CUSTOMER DETAILS
Customer relation management: Bajaj Auto ltd. believes in customer satisfaction. They try to earn consumers trust by providing good quality products and after sales services. Every two months Bajaj Auto ltd. researches the market and tries to implement the problems. They also believe in innovation and produce different variety of products with minimum price.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
For decades, Bajaj Auto was riding high. The company was enjoying a huge market share and the only way it knew was: by building basic, durable scooters on the platform of value for money.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
But when the market place changed, Bajaj was late to respond. It became clear that the company could no longer derive big market shares from limited brands and products. Then started the re-structuring of products, channels and the performance management system
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
Along with that, the company realised that it had to redesign its IT structure. Bajaj Auto announced the successful Go Live of their External Portal Initiative for their sales and service employees, dealers and suppliers.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
SAPs my SAP Enterprise Portal was implemented simultaneously with the current SAPR/3 ERP implementation.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
. Business information is now available to the companys external community in real time. This assists in improved decision-making, whether it is to meet customer requirements or to maintain efficiency in supply chain management.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
The companys field sales teams get full visibility on all dealer activities while the dealers get real-time access to relevant information on operational activities.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
The dealers and sales employees get information relevant to their respective region and territory by aggregation from the underlying SAP R/3 ERP database. Bajaj has linked 380 out of its 483 dealers through this system. Also connected are 165 out of a total of 200 suppliers.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
The dealer portal, in addition to operating information, provides access to unstructured information like news items, new product releases, new product introduction, dealer discussion groups and internal marketplace.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
The supplier gets up-to-date information on purchase orders and contracts, material schedules, and payment details. Bajaj Auto, in turn, gets invoicing information from suppliers for its automated material receipt system.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
This helps in streamlining the supply chain, optimizing inventories and reducing non-value-adding activities at both ends. Every PC has a hardware lock so that the correct terminal is established and does not travel out of the dealers premises
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
Bajaj is also planning to extend the IT systems even as it plans to launch a major marketing initiative in rural areas. As this project gets implemented, we have to see how IT can support it. There is an issue of Internet connectivity.
Strategic Implementation of I.T in Bajaj Auto to Maintain Its competitive Edge Over Others:
But the infrastructure is changing with telecom majors expanding their network as company is focussing in connecting all its network with each other through WLL.
Infrastructure Facilities
Human Resources
Technicalities Procurement
Margin
Margin
Inbound Logistics (Pay order cycle, reordering etc) Operations (processing , machines etc) Outbound Logistics (Polyurethane, Brakes , steel etc) Marketing and Sales (COCO, CODO etc) Services (Training for dealers, IT implications etc)