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SUMMER TRAINING REPORT
ON
“STUDY OF OEM & REPLACEMENT TYRE
SEGMENT FOR MARUTI SWIFT”
Submitted in partial fulfillment of the requirement for the Degree of
MASER OF BUSINESS ADMINISTRATION
Submitted by:
0
TABLE OF CONTENTS
Page No
ACKNOWLEDGEMENT 2
EXECUTIVE SUMMARY 3
OBJECTIVE OF THE STUDY 4
METHDOLOGY 5
MAIN REPORT/ ANALYSIS
6
RECOMMENDATIONS AND SUGGESTIONS 43
LIMITATIONS OF THE STUDY
APPENDICES 46
REFERENCE 50
1
ACKNOWLEDGEMENT
This project, as a part of my training, was a good experience
providing me great insight into the market dynamics of tyre industry,
buyer behavior and the sales & marketing of JK Tyre. This work has
helped me in understanding some of the intricacies and complexities
involved in the tyre industry in particular. All this would not have
been possible without the humble support and able guidance of my
mentors Mr. Ajoy Shah, Chief Product Manager and Mr. Amit
Surekar, Asst Product Manager.
They have taken keen interest in my work and were always available
to help me out with my problems, in spite of their busy schedule.
I am also thankful to PROF. VIJAY NAGRANI (Faculty, IMM), my internal
faculty guide who helped me as and when required with his big
reservoir of experience and knowledge.
Last but not the least I am also grateful to all the staff members of JK
tyres for their kind cooperation and help during the course of this
project.
2
EXECUTIVE SUMMARY
In order to start the project the first thing needed was the
understanding of the JK Industries as a whole. This formed a basis to
understand JK Tyre. By SWOT analysis & secondary research the
position of JK Tyres in Indian Tyre Industry was ascertained.
For the basic understanding and to get every insights of the project,
the Works Manager of all the Maruti Dealer Workshops were visited
and their feedback were taken into consideration, which was
necessary in the process of problem finding and giving adequate
recommendations and suggestions.
JK Tyre is the only Original Equipment Manufacturer (OEM) suppliers
to Maruti for Their Swift Model. So almost every consumer of the
Maruti Swift have JK tyre fitted in their cars. The consumers have not
replaced their tyre since the purchase of their Swift, but the research
shows that majority of the consumers would prefer to buy the
replacement tyre from dealers. And most of the consumers feel that
price of the tyre affect their purchase decision. So here, JK tyre
should try to provide their consumers with more economical tyres
with all features so that the consumers can get satisfied.
A detailed set of questionnaire were prepared which included
problems and other comments from the dealer cum service station
respondents and 62 respondents of the Swift owners who were after
all the end users. This was followed by a fitment survey in order to
find the market existence of all the tyre manufacturers as tyre
3
suppliers for various models of cars present in the Delhi region. This
analysis was based on a survey of about 100 cars in Connaught Place
region of Delhi, thereafter it was confirmed that JK Tyre stood second
with a market share of 20% & Bridgestone Tyre at the first position
with a market share of 42%. (Restricted to Delhi region).
This research is exploratory in nature, which involves fact-findings
including problems faced by the end consumers and the dealers cum
service stations, thus finding solutions for these problems.
Recommendations and suggestions were given for JK tyre based on
the research findings.
4
OBJECTIVE OF THE STUDY
This report is based on the Data collected through the survey of
Maruti Swift consumers and Maruti service stations.
Project Objective:
To study the market share of JK Tyre.
To study the consumer behaviour of a buyer of tyre.
To find out consumer knowledge regarding Tyre Rotation, Tyre
Alignment & Tyre pressure.
To study the reasons for Tyre change & influencing factors of
tyre purchase by consumers.
To find out the areas of improvement in a tyre from JK
Industries Ltd.
5
RESEARCH METHODOLOGY
Sample:
Authorized Dealers cum Service Stations of Maruti Swift.
End consumers ( Maruti Swift )
Across Delhi.
Sample size: 24 Dealer cum service stations
62 Swift owners
Survey of 100 cars randomly for fitment
analysis.
Data Collection:
Communication approach was followed throughout. Data was
collected by visiting the service stations for the filling of the
structured questionnaire designed for them. A separate
questionnaire was filled through the end consumers.
Data was edited to ensure consistency across respondents and
to locate omissions
Fitment survey was carried out through monitoring in order to
find out the market share of all the competitors in the OEM as
well as replacement segment of various cars prevailing in the
6
market through a fitment form. Surveyed 100 cars randomly in
different parts of Delhi.
Exploratory research through in depth interviewing and
participant observation.
Descriptive research for understanding the characteristic
associated with the subject population. Also for discovery of
associations among different variables.
The time dimension: Cross sectional study was undertaken
under the research.
7
MAIN REPORT/ ANALYSIS
Background
JK Industries, which belongs to the Laxmipat Singhania faction of
the JK group, was promoted in 1951, by group companies Straw
Products and JK Synthetics.
Mr. Raghupati Singhania, is an eminent industrial & business
leader, he is the Vice-Chairman and Managing Director of JK
Industries Ltd. He is also Chairman of Automotive Tyre Manufacturers
Association (ATMA). He has headed various Chambers of Commerce
& Industry as well as Government bodies and also contributed
significantly as a Leader of delegations to various countries across
the world.
He is a technology savvy business leader and also keeps himself
tuned with changing times. His remarkable visionary ability blended
with innovative & experimental zeal has been best demonstrated in
his pioneering effort of ushering radial technology in India way back
in 1977 when all other tyre companies in the country were grappling
with intricacies of bias technology.
In one of the exclusive interviews he mentions, “Continuous
innovation and state of the art technology backed by quality is the
mantra of success at JK Tyre and this has given us a clear
competitive edge over our competitors
8
JK Organization has been a forerunner in the economic and social
advancement of India. It always aimed at creating job opportunities
and to provide high quality products. It has striven to make India self
reliant by pioneering the production of a number of industrial and
consumer products, by adopting the latest technology as well as
developing its own know-how. It has also undertaken industrial
ventures in several other countries.
JK Organisation is an association of industrial and commercial
companies and charitable trusts. Its member companies, employing
nearly 50,000 persons are engaged in the manufacture of a variety
of products and in diverse fields of commerce.
Trusts are devoted to promoting industrial, technical and medical
research, education, religious values and providing better living and
recreational facilities. With the spirit of social consciousness
uppermost in mind, J.K. Organisation is committed to the cause of
human advancement.
J.K. Industries is a mega corporate entity that is emblematic of
excellence, diversification and pioneering new technologies. A part of
JK Organization which ranks among the top private groups in India,
J.K. Industries is committed to self reliance and follows an ethic that
views customer satisfaction as an index of achievement.
Over the years, the company has expanded and diversified its
business portfolio. It has developed into a multi product, multi-
location corporate entity.
The HS Singhania group has completed a major restructuring
exercise recently. The restructuring primarily involved the
9
segregation of the tyre and non-tyre businesses of the group and is
likely to have significant implications for its flagship company, JK
Industries Limited.
The decision by the group to restructure is a strategic one and is
aimed at creating stronger business entities, which would help them
to leverage their respective core competencies a lot better. The
overall objective seems to be that of maximisation of shareholder
wealth.
Pre-restructuring, JK Industries was into three different lines of
business - tyres, sugar and agrigenetics. In order to focus on the
tyre business, the company has demerged its non-tyre businesses
into independent entities. It has simultaneously merged its tyre
subsidiary (Vikrant Tyres Ltd) with itself and has thereby emerged
as an integrated automobile tyre giant. The merger is expected to
lead to increased synergies across all functional lines of activity
within the company, resulting in improved profitability, going
forward.
JK Industries is one of the few companies which manufactures
automotive tyres for nearly all the segments including tractor, light
commercial vehicles, truck/bus and passenger cars. In fact, the
company is ranked second in the Indian tyre industry with a 21%
market share, enjoying leadership in the truck/bus segment with a
market share of 25%, which has been bolstered by the Vikrant
merger. The company also has a 24% market share in the light
commercial vehicles segment. It is the only company, which makes
radials for the entire range. JK Tyres is a company that has pioneered
the passenger car radials and the truck radials in India. At present it
10
is the only company producing truck radials in India. It has its
technical collaboration with Continental of Germany.
11
Vision
“To be amongst the most admired companies in India committed to
excellence.”
Values
1. Caring for people.
2. Integrity including intellectual honesty, openness, fairness &
trust.
3. Commitment to excellence.
Mission
1. To be the largest & most profitable tyre company in
India.
Corporate Strategies –
Become the least cost manufacturer in the Indian tyre industry
& strive to achieve the lowest cost in the comparable global
parameters.
Strive to reach a premium price position and use it as driver to
improve profitability.
Strive to increase production 5% year over year with
productivity/ efficiency improvements.
Use Outsourcing as a stable strategic partnership tool to
improve top line & bottom line growth without investments.
12
Exploit Multi locational advantage to address all price segments
& improve plant efficiencies & customer service.
Get EFQM award by the year 2003.
2. To retain No.1 position in Truck & Bus segment & to be
amongst top two in all other 4 wheeler segments.
Corporate Strategies –
Continuously improve product and develop new products
keeping in mind the customer needs and expectations.
Integrate JK & VTL management philosophy, policy, systems
and procedures in all areas of management in order to leverage
on the strengths of two brands.
Put IT to innovative use to streamline processes and for most
effective and swift decision making.
Be in the forefront of E-business related areas.
Focus on Rural Markets to get the tactical marketing edge.
3. To make Truck/ Bus Radial operations profitable & retain
leadership in the Passenger Radial Market.
Corporate Strategies –
Aggressively pursue Truck & Bus radialisation in India through
STU, large fleet owners and OE driven route.
Use service as a brand differentiation.
13
Reduce cost through weight rationalisation.
Maintain continuous focus on radial capacity to retain
leadership.
14
4. To be the largest Indian tyre exporter. Continue to be a
significant player in the World in Truck Bias segment.
Corporate Strategies –
Enhance development of low cost products as per the specific
regional needs.
Use RTAs/ FTAs to increase sales & profits.
Ensure technical support in the development & service of the
products.
5. To be customer obsessed company.
Corporate Strategies –
Manage and enhance customer service and customer
relationship.
Achieve highest internal & external customer satisfaction.
Become the best in the “Speed of response” in the Indian Tyre
Industry.
6. To enhance value to shareholders & service to all
stakeholders.
Corporate Strategies –
Follow the Code of Corporate Governance.
Become a Tyre focussed company.
Contribute to society at large.
15
Care for the environment.
16
7. To develop a highly motivated team with a sense of
Ananda.
Corporate Strategies –
Strengthen the performance management system with
opportunities for people to be recognized and rewarded.
Match organizational goals with Departmental and individual
goals.
Be a learning Organization.
Be highly responsive to people issues.
Put high emphasis on team work.
Create enterprenual spirit.
8. To excel as a values driven organisation.
Corporate Strategies –
Rededicate to our core values.
Practice transparency.
Develop a culture of continuous improvements.
9. To be the most preferred tyre brand in India.
Corporate Strategies –
Invest in Brand Building.
Take up brand building as a company wide exercise.
17
18
Quality Policy
“We the people of JK Tyre will have an organisation committed to
quality in everything we do.
We will continuously anticipate and understand customer’s
requirements, convert these into performance standards for our
products and services and meet these standards everytime.
Full customer satisfaction-both internal and external-is our motto.”
Environmental Policy
We at JK Tyre are committed to protect, conserve and restore our
natural habitat and to conduct all our activities in an environmentally
friendly manner. We will continually improve our environmental
performance by :
Complying with all legal environmental requirements.
Taking measures to protect the environment by being
proactive, innovative and in cost effective way.
Conservating natural resources and energy by optimizing
efficiency, minimizing waste and supporting environment
friendly programmes.
Enhancing effectiveness of Environmental Management
through reviewing its objectives and targets.
Increasing environment awareness amongst our employees
and sub-contractors through training and communication.
19
We commit to communicate this policy to all employees and to make
it available to the public on request.
Growing Big
JK Industries is ranked as the second best company in tyre
industry in India with 21% market share, enjoying leadership in
the truck and bus tyre segment with 25% market share. Its
strong brand ‘JK Tyre’ and wide distribution gives it an edge
over peers.
With fortunes of tyre industry linked to growth in auto sector,
we believe the tyre industry is in a growth phase. We expect
growth in auto sector and Government emphasis on early
completion of road projects with largely drive growth. We
foresee the industry growing by 10-12% for the FY- 04-05.
JK is the largest exporter of tyres from India (28% of India’s tyre
exports). While it presently exports 17% of revenues, with
global trend in outsourcing picking up, we foresee a strong
growth potential and expect exports to contribute 20% by
FY05.
With auto industry in growth phase, we foresee JK’s volume
growing by 15% outperforming the industry growth of 10-12%.
With this and realization improving by 2%, we expect revenues
to grow by 16% in the FY04. With this, benefits accruing from
economies of scale and lower interest costs, we expect
earnings to grow by 105% in FY04.
20
Given JK’s leadership in truck and bus tyres, strong presence in
4 wheelers radials and focus on increasing exports, we believe
the outlook is strong.
It has technical collaboration with Continental AG of Germany
(world’s 4th largest tyre company), which enabled it to be a tyre
technology leader in India. In our opinion, its efforts to
restructure and focus on tyre business are early signs of this
event.
JK Tyre is determined for delivering the best and the most
reliable products to its customers. For this JK Tyre has built
Hari Shankar Elastomer and Tyre Research Institute
(HASETRI) in Rajasthan.Its focus on R&D, efforts to widen
product range, increases capacities (5.7mn tyres) and offer
radials for the entire range of 4 wheelers to service a wide
customer base has further strengthened its presence in the
industry.
JK Tyre has the largest distribution network of 4000 dealer
across India.
It has a turnover of around Rs.2500 Crore.
It is world’s first tyre company, which is given ISO 9001
certification for “Multi-location operations.”
It is ranked as the 18th largest tyre company in the world.
21
It has been awarded “Superbrand”. This is the only tyre
company to receive the prestigious status.
It is known as the most consumer friendly company.
It has been rated as the best by JD Power Consumer
Satisfaction Survey. It means that the consumers who use JK
tyres are the most satisfied.
Technology:
“Sabse pahle aur sabse behtar” defines the technology of
JK Tyre. JK Tyre is the first Indian Tyre Company, which
ventured into Radial technology. JK Tyre has always been
ahead in technology to give its consumers the best products.
JK Tyre has received The Rajiv Gandhi National quality Award
for the year 2001.
JK Tyre is the world’s first tyre company to receive ‘ISO 9001’
certification for its Quality Management.
JK Tyre is the world’s first tyre company to receive Quality
Management System certification ‘QS 9000’.
JK Tyre has received certification for Environment Management
System (ISO 14001).
Product Range:
22
JK Tyre manufactures tyres for a wide range of vehicles and
offers the most comprehensive range of products to suit the
requirements of its customers. Presently JK offers tyres for:
Trucks
Light Commercial Vehicles ( LCVs)
Jeep
Car
Racing Car Tyres
Tractor
Trailer
Animal Driven Vehicles.
Plant Locations:
JK has tyre plants at Jaykaygram, Kankroli in Rajasthan, Banmore
near Gwalior in Madhya Pradesh and Mysore, Karnataka. Radial tyres
are manufactured at the Banmore plant. They also have the Vikrant
plants which are located in Bangalore and Mysore.
23
JK TYRE
Ever since its inception it has been JK Tyre's belief in the value of
technological superiority that has made it grow by leaps and bounds.
This division produces and sells tyres and tubes under the brand
name "JK Tyre" for Truck, Buses, Passenger Cars, Jeeps, Light
Commercial Vehicles, Multi Utility Vehicles and Tractors.
The company pioneered Steel Radial Technology in India in 1977 and
continues to be the industry leader in the Radial segment in India. JK
Tyre is the only Tyre Manufacturer in the country to produce high
performance 'T' & 'H' -rated steel radial tyres.
JK Tyre has consciously followed a policy of continuously modernizing
and expanding its tyre manufacutring facilities to retain its edge in
the market place.
Their customer base covers virtually the entire Original Equipment
Manufacturers (OEMs) in India together with Replacement Market
for four wheeler vehicles, Defence and State Transport Units. Besides
24
India, they have a worldwide customer base in over 45 countries
across all 6 continents.
To keep pace with the market demand as well as technological
leadership in Indian market, J.K. Industries acquired Vikrant Tyres
Limited, Mysore in 1997. J.K. Industries and Vikrant Tyres Limited
are the only tyre companies in India to have received all three ISO
9001, QS 9000 and ISO 14001 certificates and now are soon to get
the TS16949 Certification, the latest in the automotive industry
worldwide. This indeed is a true reflection of their commitment to
system oriented approach. The company has a technical
collaboration with M/s Continental AG, Germany, which is among
the top five tyre manufacturers in the world to keep pace with latest
technological developments.
To stay at the forefront of technological advancements a state of art
Research & Development Centre, HASETRI, was set up, which
remains the nerve centre for providing cutting edge technology. In a
short span of time it has emerged as the 17th largest tyre
manufacturer in the world an achievement in itself.
25
With three plants located in Rajasthan, Madhya Pradesh and
Karnataka, JK Tyre is the largest manufacturer of truck and bus tyres
in India. The truck and bus tyres produced account for nearly 74% of
the total tyre business in India, thus giving JK Tyre an undisputed
position. Additionally, JK Tyre is the only manufacturer of truck/ bus
steel radial tyres, and the second largest manufacturer of 4-wheeler
tyres in the country.
Also, JK Tyre is the largest exported tyre brand from India. It was
awarded the CAPEXIL's Highest Export Award for 1997-97 by FIEO. It
enjoys preferred premium brand status in Truck Bias market in USA
and across many markets in Africa, Middle East and South East Asia.
“We the people of JK Tyre will have an organization committed to
quality in everything we do. We will continuously anticipate and
understand our customer's requirements, convert these into
performance standards for our products and services and meet these
standards every time. Full customer satisfaction - both internal and
external” is their motto.
26
QUALITY MANAGEMENT
ISO 9001
JK Tyre world's first tyre company to receive 'ISO 9001' certification
for its entire operations in 1995 in one go. their Quality Management
System is completely integrated into all aspects of our operations.
QS 9000
JK Tyre the world's first tyre company to receive Quality Management
System certification QS 9000', in 1998 for multi location operations.
They are using 'QS 9000' system as a tool for continuous incremental
improvement.
Environment Management System (ISO 14001)
JK Tyre recognizes the impact that our business has on the
environment and take our responsibilities for maintaining harmony
with nature. They are the first tyre company in India to receive 'ISO
14001' certification for multi location operations in 1999.
"E-mark"
JK Tyre is the only Tyre Company in India having the E-mark
certification on their products, a mandatory requirement for
exporting tyres to European Markets.
27
"DOT" (Department of Transport)
JK Tyre have the DOT certification on its products, a mandatory
requirement for exporting tyres to US Market.
"INMETRO" (Instituto Nacional De Materiologia - Brazil)
They also have the certification from INMETRO a mandatory
requirement for exporting tyres to Brazil (South America). This is a
product as well as a system certification. Also this is a proof of
superior quality of JK Tyre and our ability to meet stringent
international standards.
28
MARKETING
International:
JK Tyre is a leading exporter of tyres from India and roughly accounts
for about 26% of the total tyre exports from India (along with its
associate Vikrant Tyres Limited)
It is the first and only tyre manufacture in the world to receive the QS
9000 for multilocation operations : World's first tyre manufacture to
receive the ISO 9000 for all its operations in one go. Also J.K Tyres is
the first tyre company in India to receive ISO 14001 in recognisition
of its environmental management systems. Today, JK Tyre's products
compete with the best international players in the premium
international bias market in more than 55 countries in 6 continents .
The exports operate through a strong and dedicated distribution
network, and their distributors are fully supported by the company's
technical team in terms of continued product development to meet
specific market needs. JK Tyre had obtained international
accreditation for its products in the US , Europe , South America and
the Middle East.
J.K Tyre has been the recepient of various awards for exports for the
last many years for its commitment to offer superior performance
standards & path -breaking innovations. Recently , it was honored
with ' The Special Export Award 2000-2001' from Capexil, making it
its fourth consecutive award from India's premier industrial
association . JK Tyre has also been recently recognised by Indian
29
Trade Promotion Organisation (ITPO) for being the largest tyre
exporter to Latin America markets and is the proud recepient of first-
ever FOCUS LAC Award for the year 1999-2000. J.K Tyres constant
endeavor to deliver superior value to its customers and a sound
marketing strategy forms the foundation of this spectacularly
consistent performance on the international front.
While JK Tyre has maintained its consistency in its marketing and
distribution strategies for the export markets, it has also actively
pursued development of new superior products to adapt to specific
requirements of the different markets . The credit goes to the India's
biggest in-house R&D centre, HASETRI (Hari Shankar Singhania
Elastomer and Tyre Research Institute) . This Centre for Rubber and
Allied Technology was eatablished at Jaykaygram, ISO/IEC Guide 25 &
EN 45001. Equipped with advanced testing facilities, it pursues
excellence by evolving technologies for superior product performance
to reduce waste and pre-empt consumer needs. They are also
recipient of Rajiv Gandhi Quality Award For Excellence for the year
2002 -2003.
JK Tyre has achieved lot of milestones. However, with plans to bring
in several pioneering technologies and benchmarking customer
service standards there's lot which will roll out in future in JK Tyre's
unstinted path to winning.
Finance scheme to increase sales:
With radial tyres for commercial vehicles having failed to excite bus
and truck owners in India, JK Tyres has hit upon an unconventional
selling strategy.
30
It has come out with a money-back guarantee scheme on its radial
tyres. The company has signed up over 5,000 fleet operators and six
state transport undertakings (STUs) to fit its radials in exchange of
performance guarantee. These 5,000 fleet operators together
operate around 3,00,000 buses and trucks, out of which 20% are
expected to convert to radial tyres in the coming times.
JK is promising a fuel saving of 7-10% and upto 50% more tyre life on
its radial tyres as compared to conventional crossply tyres. The fleet
operators and STUs will be reimbursed with the cost of the tyres in
case they fail to realise the savings as promised.
The move is part of an effort to popularise radials tyres for
commercial vehicles in India, which is facing consumer resistance
because of higher initial cost. Radial tyres are usually 25% costlier
than conventional crossply tyres.
The price difference is however expected to narrow down as volumes
rise and competition emerges (Michellin Apollo tyres Ltd. A 51:49
joint venture to produce 1 mn truck radials in India from sept, 2005.).
Presently radial tyres account for only about 2% of all commercial
vehicle tyres sold in the country. During ’02-03, on an average about
7,00,000 units of commercial vehicle tyres were sold per month in
the domestic market which in the current year is hovering at around
8,50,000 units.
In ’99 JK Tyres became the first company to manufacture radial tyres
for commercial vehicles in India. The company has so far invested
close to Rs 350 crore in its radial facility in Mysore which has a total
capacity to produce about 2,25,000 units of radials for commercial
31
vehicles per month. The company is currently selling around 20,000
units of CV radials per month to all segments in India.
However the four-laning of highways under the National Highway
Development Programme, THE GOLDEN QUADILATERAL, NORTHEAST
SOUTHWEST CORRIDOR, BHARAT JODO ROAD YOGNA &
PRADHANMANTRI GRAMIN SADAK YOJNA, (initiated by the honourable
Prime Minister of India Shri. A B Vajpayee, at the approximate cost of
around Rs.2,10,000 Cr.) The trucking industry which has been in the
hands of uneducated operators since its inception is also undergoing
major reforms and rationalisation process. This is also expected to
give a boost to the radialisation of CVs in the country in the coming
years. Mr Singhania expects the share of radial tyres in the total
domestic sales of crossply tyres to increase to 10 - 15% by ’07-08.
32
JK STEEL WHEELS
At JK Tyre Customer's needs are continuosly anticipated and
understood and these are then converted into Performance standards
for the organisation.
JK Tyre has been at the forefront of product innovations and
introduction of world class products in the Indian market. JK Tyre
pioneered radial technology in India by producing radials ways back
in 1977 , revolutionising the Indian market. As radials were a new
product line in the country considerable resources were deployed in
educating consumers about radials. This has led to a strong
association of the "JK Tyre" brand with radial.
In anticipation of customer needs arising from the advent of world
class cars and MUVS in India JK Tyre has established a state of the
art nation wide franchisee chain of retail outlets in major cities
33
branded as 'STEEL WHEELS' 'The One stop Sales cum Service
Centres'. These exclusive outlets are redefining tyre retailing.
This was a clearly focussed marketing and customer care intiative
from JK Tyres At the Steel Wheels outlets the customers can choose
from wide range of JK Tyre car radial & bias tyres for passenger cars,
as well as avail of host of value added services in an ambient
atmosphere. Skilled technicians are on hand to provide these
services.
The services that can be availed are:
Wheel alignment
Wheel Balancing
Automated tyre changing
Guidance on Tyre care & maintenance
Tyre Rotation
Correct air care
The benefits of correct tyre care are longer tyre life , better vehicle
handling and ride comfort , fuel conservation. Very soon other allied
automotive products will also be available at JK Tyre Steel Wheels. JK
Tyre already has more than 100 such outlets across the country and
the chain is rapidly growing.
34
As a market leader JK Tyre has been in the forefront for providing pro
active customer care. Steel Wheels outlets have been the cutting
edge in providing service to customers.
35
DIAL-A-TYRE SERVICE
From the pioneer and leader in radials in India comes yet another
innovation India's first and only unique -"Dial-a-Tyre Service",
delivering tyres at the customer's doorstep.They have made possible
for tyre replacement which is just a phone call away. All you need to
do is just dial "23312136"* from the comfort of your home or office
and leave instructions for delivery of tyres while you are enjoying
your weekend or running through a busy work schedule.
In this service provided by them they provide trained technicians who
will deliver & fit tyres of your choice from the wide range of JK Tyre
passenger radial & bias tyres for your car at a pre appointed time.
The service provides value added services like automated wheel
changing & balancing on site and alignment at designated JK Tyre
Steel Wheels Outlets. The Dial a Tyre team and Steel Wheels outlets
would also be glad to provide tips on tyre care and usage.
36
Other Marketing Campaigns, Promotions and
schemes
COOL WHEELS - FREE TYRE CHECK CAMPS
Customer Service both pre and post sale has today become one of
the critical differentiating factors which aggregates as a complete
package deal for the customer when he purchases the product and
can be used as an effective tool for ensuring loyalty of the customers.
Keeping in mind the motto of full customer satisfaction to both
internal and external customer, a strategy was devised to effectively
counter the competition and gain visibility through below the line
promotional media.
The concept branded as 'Cool Wheels" stands for a free tyre check
camp (for all car tyre brands) conducted by them wherein they
offered the following services to the customers
Wheel Alignment at 50% discount.
Free Wheel balancing (Cost of weights is chargeable to the
customer).
Inspection of tyres by our service engineers/ service trained
personnel.
Tyre Rotation wherever necessary.
All the customers visiting the outlet are given a tyre inspection
report and a copy of this report is retained for records and
future use/customer contact.
37
The customer visiting the camps are given a small giveaway,
and they became eligible to enter into the lucky draw contest.
This is being done to create higher brand visibility and recall
and ensure higher customer interest in the activity.
The camps are conducted at the Steel Wheels Outlets and some
other major multibrand counters. Till date they have conducted Cool
Wheels service camps in the following cities- Chennai, Delhi (thrice),
Bangalore, Coachin, Mumbai, Noida(twice), Faridabad (twice),
Ludhiana and Chandigarh to name a few, wherein over 10,000
customer have availed of these services.
These camps have been promoted by using innovative and cost
effective means, which have created a lot of hype in these important
markets. Some of the activities carried out by us to promote the
camp are as follows-
Promotion at IOC Outlets - Promoters are placed at IOC petrol
pumps. These promoters interact with the customers coming in for
refuelling and brief them about the camp and the locations. A leaflet
containing corporate communication, location of outlets for the tyre
check camp and coupon for entering into the lucky draw contest is
given to the customers. The names, addresses, vehicle make of
customer who responded are noted down and in return they are
given a giveaway.
Also at these outlets you will come across air filling machines
sponsored by JK Tyres.
A team of promoters is also used to promote the camp at
38
Important marketplaces / commercial complexes
Residential areas
Office complexes
Cinema halls
Traffic intersections
Areas adjoining dealer counters.
Demand determinants
Growth of automobile industry, which will increase vehicle population
and thereby the demand for tyres in OEM as well as replacement
market.Relative importance of road transport and long distance
travel by road leading to increased need to replace tyres.
Development of export market, which will also enable higher capacity
utilisation levels. Economic scenario and credit availability which will
determine ability to purchase automobiles and in turn spur demand
for tyres.
Retreading, which saves up to 80% on original cost, will have a
negative impact on fresh demand. Radialisation, which increases the
life of tyres and thereby reduces the need for a replacement will
inhibit volume growth.
Earnings sensitivity factors
39
Raw material price fluctuations : The prices of natural rubber, an
agricultural commodity. In the last few months, prices have
recovered due to increase in international prices. Other raw materials
are mainly petrochemical based and movements are cyclical.
The government’s decision to impose 10% safeguard duty on carbon
black, hiking benchmark prices of natural rubber and hiking import
duties on natural rubber will have adverse impact on the operating
margins.
JK TYRES HR MANTRA
They start the day as fresh as any one else. But at the end of the day,
they become more fatigued than any ordinary workmen. These are
corporate executives we are talking about and this is the concern
that is at the core of JK Tyres' human resource development
initiatives.
While a number of Indian corporates are bogged down with
formulating HR plans, such as ESOPs (employees' stock option plans),
and employee incentives to stop employees from leaving them, JK
Tyres has put its HR focus on the mental and physical health aspects
of its employees and their self-development. And this has paid
dividends in that its employees are sticking with the company.
The company had organised a two-day workshop for its executives on
Transcendental Meditation to help them relieve mental stress and
fatigue. "In fact, the immense mental stress executives are subjected
to under modern working conditions pull them down when the day is
only half-way through. This fatigue is ultimately reflected in their
day's output, their efficiency and creativity, interpersonal
40
relationships, and the quality and productivity of the company on the
whole," says Dr S Mukherjee, general manager (HRD), JK Tyres.
Mukherjee says the company focusses on retaining and developing
the talents of its employees, rather than drawing up programmes for
retaining the employees themselves. It believes that if the
employees' talents are properly nurtured and they are given an
amiable environment to flourish in, they will stay with the company.
Keeping its employees healthy and mentally fresh also serves the
very core objective of the company-productivity and profitability. If its
executives can perform their tasks in a stress-relieved mind-frame,
they become more creative and efficient at their work, their output
grows and, most important, their interpersonal relationships become
more conducive to work. All these result in higher productivity as well
as better quality, which further translates into higher profits for the
company. Further, by keeping its employees physically and mentally
fit, the company also circumvents `hidden costs' such as loss of
working hours and low productivity.
Continuing with its focus on developing the physical and mental
health of the employees, JK Tyres has initiated an `Employee
Assistant Programme'. The programme is, however, limited to its
Delhi office for the present. Under this programme, JK Tyres' Delhi
employees have free access to a clinical psychologist for consultancy
on any problems pertaining to home or office, either for the
employees themselves or for any member of their families.The
company now plans to conduct a workshop on the art of living for its
employees. The main focus of this programme will again be self-
41
development through the release of stress and tension, improved
health and well-being, and greater clarity and creativity of mind.
These workshops, including the last one on Transcendental
Meditation, however, are not compulsory for JK Tyres executives;
participation is wholly voluntary. But interestingly, more than 60 per
cent of the company's executives, cutting across sections,
participated in the last meditation workshop and over 70 per cent of
those who participated in the previous workshops have kept up with
their practice.
SWOT ANALYSIS OF JK TYRE
Strengths:
Clearly articulated vision
Consumer confidence in the product
Motivated and committed team of people
Dedicated dealer network
Consistently improving efficiency levels of manufacturing
facilities
Economies of scale in purchasing
Leadership attitude, energy and aggression in the marketplace
In-depth understanding of market and customer needs
42
Research and Technological advances
Weaknesses
Low presence in the latest car models like Hyundai, Accent,
Mitsubishi Lancer,etc
Low presence in two/three wheeler segment
Opportunities
Robust economic growth, particularly in the production of
vehicles, is expected to result in healthy demand for tyres in
the future.
Excellent brand equity of Indian cross ply / bias truck tyres in
the world market can open market opportunities for export of
truck and passenger car radial tyres.
Emergence of India as a hub for production of small cars is
expected to give a thrust to auto component and tyre segment.
Newer entrants in 2-3 wheeler manufacturing companies like
Honda Motors, would boost demand for 2-3 wheeler tyres.
Improved road infrastructure - especially on the Golden
Quadrilateral and North - South East - West National Highway
project - will result in significant increase in movement of goods
43
and passenger traffic through roads with resultant growth in
demand for tyres.
Reduction in import duty of raw materials in the next Union
Budget and further Rupee Appreciation could lead to reduction
in cost of inputs.
Continued absence of a leading player
Consolidate market position in LCV & car tyre segment
Radialisation in commercial vehicle segment
44
Threats
Rising cost of raw materials, specially natural rubber in the
international as well as domestic market.
Reduction in import duties could lead to higher volume of tyre
imports.
Competition in manufacturing from multinationals setting up
new facilities in the country or region.
Concessional import tariffs for countries like China and South
Korea under Regional Trade Agreements could lead to stiff
competition on prices.
Rupee appreciation could lead to lower export realisation.
With improvements of roads, usage pattern of tyres may
change from Cross Ply to Radials, which will involve substantial
investment in plant and machinery for expanding Radial facility
Increased retreading by bus operators
Cheap imports from China and Far East
Upward trend in natural rubber prices
45
DATA ANALYSIS BASED ON CONSUMERS’ SURVEY
(Sample Size-62)
1. Which model of Swift do you use?
(a) LXI (b) VXI (c) ZXI
The responses for this question reveals that the most popular
model amongst the consumers is VXI(46%), the second most
46
popular model is LXI(39%), and the last but not the least
favourite model is ZXI(15%).
47
2. After how many kilometres you get these services done?
Kilometres Tyre Rotation Tyre
Alignment
0-5000km
5000-10,000km
10,000-15,000km
15,000-20,000km
Awareness about tyre rotation:
48
The first pie chart shows that 97% of the consumers are aware
about tyre rotation while only 3% of the consumers are not
aware about it. Out of the 97% consumers who are aware
about tyre rotation, only 52% of them are correct. Correct in
the sense, they know when this service has to be performed.
Whereas, a huge percentage i.e. 48% of the consumers have
incorrect knowledge about this service.
Awareness about tyre alignment:-
49
The first pie chart above shows that 85% of the consumers are
aware about tyre alignment while only 15% of them are not
aware about it. But out of the 85% consumers who are aware
about tyre alignment 89% of the consumers have correct
information while only 11% of them have incorrect knowledge
about this service.
50
Here we can clearly see in the pie chart that between 0-
5000kms, 84% of the consumers get their tyres rotated and
16% of the consumers get their tyres aligned.
From this pie chart we can find out that between 5000-10,000kms,
62% of the consumers get the service of tyre alignment done while
38% of the consumers get their tyres rotated.
From the survey it was also revealed that not even a single consumer
get these services of tyre rotation and tyre alignment done between
10,000-15,000km & 15,000-20,000kms.
51
3. Did you change your tyre after the purchase of your
vehicle?
(a) Yes (b) No
The answer to this question was “NO” by all the 62
respondents. As this was quite expected that consumers
wouldn’t have change their tyre because Swift is a new model
from Maruti, hardly a year long, so consumers might not have
felt the need to change it.
52
4. Which features of tyre do you give importance?
(a) Mileage (b) Durability (c) Tyre Quality
(d) Availability (e) Others_________
The graph shows that durability is more important for the consumer
from the tyre features point of few, followed by mileage which is a
little less important. Tyre quality is also one of the aspect which a
consumer looks for in the features of the tyre. And the least
important is the availability aspect of the tyre of which the consumer
is not much bothered about.
53
5. Are you aware of the recommended tyre pressure of
your vehicle?
(a) Yes (b) No
54
This pie chart shows that majority of the consumers are not
aware of the correct tyre pressure. Of the 26% that say they
are aware only 75% are actually correct. This shows a low
level of awareness regarding basic usage of tyres. This is
especially important as many of the complaints generate
from incorrect tyre pressure.
6. Are you satisfied with the performance of your tyre?
(a) Yes (b) No
The answer to this question was very beneficial from the
company’s point of view. All the respondents said that they
are satisfied with the performance of their tyre, not even a
single consumer said that he is not satisfied.
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7. From where do you buy the replacement tyre?
(a) Dealer (b) Retailer (c) OE
Franchisee________
Although most of the consumers have not replaced their tyre
even for a single time since purchase of their car but they
were ready to answer this question also. This is because, if in
future they feel the need to replace tyre 81% will purchase
the tyre from the dealers while only 19% will buy it from the
retailer.
56
57
8. Does the price of the tyre affect your purchase decision?
(a) Yes (b) No
From the observations it was found that 82% of the
consumers purchase decision is affected by the price of the
tyre. While only 18% of the consumers are not affected by the
price of the tyre when it comes to buying a tyre.
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9. What all influence your purchase decision?
(a) Brand Advertisement (b) Promotional Offers
(c) Service Station Supervisor (d) Others(specify)____________
The graph gives a clear picture of what all influence the
purchase decision and brand comes out to be the deciding
factor that the customers look into while buying a tyre. So it
becomes more important for the company to create high
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brand value for its products by extensive marketing
exercises.
Data Analysis Based On Maruti Service
Stations
(Sample Size- 24)
Q1. How many Swifts you get in a day for servicing?
(a) 0-15 (b) 15-30 (c) 30 & above
All the respondents tell that they get 0-15 Swifts in a day for
servicing and none of them gets more than 15 swifts in a day
for servicing.
Q2. Please write the break up of the model you get per day?
(a) LXI(165/80 R14)__ (b) VXI(165/80 R14)__ (c) ZXI(185/70 R14)__
60
From this pie chart we can make out that maximum number
of VXI were found in the service station followed by LXI which
is less by only 4% and then the least number of ZXI were
seen which comprises of 24%. This implies that the market
for tyre size(165/80 R14) is very promising.
Q3. What types of tyre services do the customers avail?
(a) Wheel Alignment (b) Tyre Pressure (c) Wheel
Balancing
(d) Uneven Wearing (e) Premature Failure (f) Tyre Rotation
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The pie chart shows that the services, wheel alignment and
tyre rotation are both equally availed by the customers (26 %
each), followed by 24% of the customers who avail the
service of wheel balancing, which is followed by a little 18%
of customers who get the tyre pressure service. Whereas
only 4% customers avail the service for uneven wearing and
2% the service for premature failure. That means the
durability and tyre quality is absolutely fine.
Q4. What kind of feedback do you get from the customers? Do you
get any kind of tyre complaints? If yes, please specify.
62
-- Although most of the Works Manager said that they get
satisfactory feedback. But still there were few complaints which
they receive from the customers. Some of the complaints are as
follows:-
Humming sound at the speed of 25km/hr to 55km/hr in
VXI and ZXI
Noise from the tyres especially from Esteem and abnormal
wearing in Zen.
Rear tyre wearing in ZXI.
Earlier, there were few complaints of left side pulling and
front tyre wearing.
There were some problems related to Alloy wheel, rim, bolt,
FOC, and suspension in some vehicles (Swift).
There were some tyre wear problem along with bearing
noise.
Q5. From where do you fulfill the requirements of your tyres?
(a) Company _________ (b) Retailers __________
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(c) Dealers _________ (d)Others(Specify)__________
We can clearly see in the graph that 19 Works Manager of
different Maruti Service Stations fulfill their requirements of
tyres from dealers while only 4 out of the 24 Works Manager
fulfill it from the company. And only one, fulfill it from his
own arrangement. But not even a single workshop get their
needs of tyre fulfilled from retailers.
Q6. After how many kilometres you perform these services?
Kilometres Tyre Rotation Tyre Alignment Wheel
Balancing
64
0-5000km
5000-10,000km
10,000-
15,000km
15,000-
20,000km
As the graph shows that most of the service stations (22)
perform tyre rotation between 0-5000kms. And out of the 24
service stations, 18 of them perform tyre alignment between
5000-10,000kms, 3 of them perform between 10,000-
15,000kms while 2 of them between 0-5000kms. Whereas,
65
observing the graph for wheel balancing we can see that it
was an equal ratio (i.e.12 each) of the service stations which
performs this service between 0-5000kms and 5000-
10,000kms.
Q7. Do you provide any kind of free tyre servicing to the customer?
(a) Yes (Specify)________ (b) No
The answer to this question was not surprising and that is
“No” by all the service stations Works Manager. Not even a
single service station provides any kind of free tyre servicing
to the customer.
Q8. Do you get any type of promotional offers from any of the brand?
(a) Yes (Specify)________ (b) No
It was found that not even a single Maruti Service Station
gets any kind of promotional offers from any of the brand.
And the answer of every Works Manager was “No”. And our
company can grab this opportunity by providing some kind of
promotional offers and schemes to the service stations, if
needed.
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Fitment Survey Analysis
What is fitment survey?
A fitment survey is used to find out the market existence of all the
tyre manufacturers in a particular region. A collective analysis of
this survey would help to ascertain the actual percentage of market
share of all the players in the region.
A fitment analysis is done by surveying all the tyres fitted on to the
front as well as on the rear wheels, individually, of a vehicle.
Area Covered :- Delhi Region – Connaught Place
Analysis Report :-
67
From the fitment survey it is analysed that Bridgestone has the
highest market existence with 42% of the market share, with JK Tyre
following at 20% market existence. And this is followed by MRF which
is 3% less than JK Tyre and holds 17% of the market share. Whereas
Good Year has 14 % market share and last but not the least is Apollo
tyres with 7% of the market share..
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Recommendations and Suggestions
Basic Understanding
There are some very basic understandings in this industry, tyre
industry, that I have always kept in mind throughout my
recommendations and which I feel is utmost essential to keep in mind
before formulating any kind of strategies by the company. These
understandings are:
A tyre for the passenger car segment is more or less a high valued
product as the end consumers are from the high end income groups.
The following are some of the factors which influence a customer to
purchase a particular brand of tyre:
Mileage
Originally equipped manufacturer
Price
Tyre Quality.
Brand Advertisement
Aesthetics
Although not many of the customers accept the above as being their
motivational factors for purchasing a particular brand of tyres. These
69
are some of the conceived purchasing forces driving a customer’s
choice for a tyre. I confirmed this statement only after talking to a
number of service stations and in particular and after having a long
casual conservation with many of the Swift owners.
Promotions:
There is an urgent need of aggressive brand promotion for the range
of JK Tyre for Maruti Swift at the consumer’s as well as at the service
stations end. This is because, after the market research it was clear
that majority of the consumers get influenced by brand promotion
when it comes to their purchase decision. So it is required by the
company to do the brand promotion of their products and make a
longlasting impact on the consumers mind and persuade them to buy
company’s product. In these promotional activities the mechanics
and the tyre fitters should also be targeted since they are one of
the biggest influencing forces for the end users as far as word of
mouth awareness among the consumers is concerned. These are the
people who generally advice the users for using a particular brand of
tyres. It’s not at all tough to build an image with such people all they
need is a little attention and some tangible incentives.
Better after sales service :
Many service managers were not satisfied with the response that
their clients get from the tyre companies. For instance they cited
many instances in which the tyre company refused to replace the
tyres putting the blame back on the customers. This creates a bad
image for the company. This results in loosing not only that particular
customer but also many others which the customer may influence.
70
The company should take extreme caution while evaluating such
complaints. It is also recommended to reduce the time taken for
handling
such complaints. The company should build up its image by regularly
holding company & end customer meets.
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Use of Information Technology:
It is true that most of the end consumers of the Swift are advanced in
terms of technology, education, internet, etc. Internet not only
reduces the chain of distribution thus cutting costs for the company
but also reduces time lag between order placement and delivery. It is
also known that none of the tyre manufacturers are using this kind of
technology in the tyre industry at present. Therefore, it is
recommended that JKI’s IT department could keep this kind of
business, e- commerce, as their pipeline future marketing strategies.
Further, information technologies can be used for managing
databases & filing up sales information.
Mileage and quality :
Mileage and quality of the tyre was rated as the most important
factors, so JK
must give priority to improve upon them.
Sales Team
The company need to motivate the front line salesperson to be able
to get important information about the market, because they are the
people who are
in direct touch with the market, they should be advised to give a
weekly report to the regional office as to the latest updates on the
market development taking place in the market and also the
emerging needs of the consumers. This would help the company to
72
be in touch with the latest happenings in the market and also will be
able to take necessary actions at the appropriate time.
Limitations of the survey
There were some limitations which appeared while accomplishing the
project.
Some of the limitations are as follows :-
Sampling Error
Study limited to Delhi only.
Situational Factors.
Time Constraint
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APPENDICES
74
CONSUMERS’ SURVEY QUESTIONNAIRE
NAME :_______________________________________________________
VEHICLE NO :_______________________________________________________
ADDRESS :_______________________________________________________
CONTACT NO :_______________________________________________________
1. Which model of Swift do you use?
(a) LXI (b) VXI (c) ZXI
2. After how many kilometres you get these services done?
Kilometres Tyre Rotation Tyre Alignment
0-5000km
5000-10,000km
10,000-15,000km
15,000-20,000km
3. Did you change your tyre after the purchase of your vehicle?
75
(a) Yes (b) No
4. If your answer to the above question is yes, then please specify
why do you feel the need for changing the tyre and with which tyre
brand and size you did so?
______________________________________________________________________
________________________________________________________
5. Which features of tyre do you give importance?
(a) Mileage (b) Durability (c) Tyre Quality
(d) Availability (e) Others_________
6. Are you aware of the recommended tyre pressure of your vehicle?
Yes No
If yes, Please fill the Rear Tyre Pressure____________
& the Front Tyre Pressure_______________
7. Are you satisfied with the performance of your tyre?
76
(a) Yes (b) No
8. If your answer to the above question is no, please specify the
problems faced by you with the performance of your tyre?
_______________________________________________________________
9. From where do you buy the replacement tyre?
(a) Dealer (b) Retailer (c) OE
Franchisee________
10. Does the price of the tyre affect your purchase decision?
(a) Yes (b) No
11. What all influence your purchase decision?
(a) Brand Advertisement (b) Promotional Offers
77
(c) Service Station Supervisor (d) Others (specify)____________
( Thank You )
QUESTIONNNAIRE FOR MARUTI SERVICE STATIONS
NAME :_________________________________________________
DESIGNATION :_________________________________________________
ADDRESS :_________________________________________________
CONTACT NUMBER:________________________________________________
1. How many Swifts you get in a day for servicing?
(a) 0-15 (b) 15-30 (c) 30 & above
2. Please write the break up of the model you get per day?
(a) LXI(165/80 R14)__ (b) VXI(165/80 R14)__ (c) ZXI(185/70 R14)__
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3. What types of tyre services do the customers avail?
(a) Wheel Alignment (b) Tyre Pressure (c) Wheel
Balancing
(d) Uneven Wearing (e) Premature Failure (f) Tyre Rotation
4. What kind of feedback do you get from the customers? Do you get
any kind of tyre complaints? If yes, please specify.
______________________________________________________________________
________________________________________________________
5. From where do you fulfill the requirements of your tyres?
(a) Company _________ (b) Retailers __________
(c) Dealers _________ (d)Others(Specify)__________
6. After how many kilometres you perform these services?
Kilometres Tyre Rotation Tyre Alignment Wheel Balancing
0-5000km
5000-10,000km
79
10,000-15,000km
15,000-20,000km
7. Do you provide any kind of free tyre servicing to the customer?
(a) Yes (Specify)________ (b) No
8. Do you get any type of promotional offers from any of the brand?
(a) Yes (Specify)________ (b) No
( Thank You )
REFERENCE:
BOOKS:
1. Philip Kotler, “Marketing Management” 11 ed
2. Harper W. Boyd, Jr. Ralph Westfall, Stanley F. Stasch
“Marketing Research” 7 ed
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3. Leon G. Schiffman, Leslie Lazar Kanuk, “Consumer Behavior”
8ed
WEBSITES:
1. www.jktyre.com
2. www.ft.com
3. www.jkorg.in
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