Marketing Strategies to enhance the Channel Partner Performance in the Indian Automotive Tyre Industry: Adapting the 4P Model.
Lokesh Chola
Research Scholar,
GLA University, Mathura
Email: lokesh.chola_phd.mgmt22@gla.ac.in
corresponding author
Dr. Krishanveer Singh
Associate Professor,
GLA University, Mathura
Abstract
Purpose: This study investigates how the understanding of pricing, product knowledge, and awareness of policies among dealers affect their performance and decision-making in the Indian tyre industry. This research provides valuable insights into how adapting the 4P model to include policy can lead to more effective marketing strategies in the oligopolistic tyre market in India.
Design/methodology/approach: The research employs a quantitative survey methodology to gather data from dealers across various regions in India. It analyzes the correlation between the three key variables—price understanding, product knowledge, and awareness of policies—using statistical tools to assess their impact on dealer performance metrics such as sales volume and customer satisfaction.
Originality/value: This paper contributes to the existing literature by highlighting the critical role that comprehensive training and clear communication of policies play in enhancing dealer effectiveness. It emphasizes the need for tyre manufacturers to invest in dealer education regarding pricing strategies and product specifications to foster better market performance.
Keywords: Pricing, Product, Policy, Tyre and Channel Partner.
Introduction
A HISTORICAL BACKGROUND
The first rubber Tyres showed up within the mid-1800s. They were robust or pad tyres within which the rubber itself sent the heap, maintained stuns, and opposed cutting and scraped areas. the gas or full Tyre, that sent the heap and consumed stuns by the compacted air within the Tyre packaging, was protected as right time as 1845 by patent it. Robust elastic Tyres were favoured over pneumatic tyres thanks to their solidness, thus pneumatic Tyres fell into neglect. The prevalence of bicycles within the late 1800s revived the chance of the pneumatic tire, and in 1888 a capital veterinary specialist named john Boyd Dunlop got a patent for a pneumatic bicycle tyre.
The principal utilization of pneumatic Tyres for vehicles was spearheaded by the Michelin siblings, Edouard and Andre. They outfitted an auto with pneumatic Tyres and drove it in the 1895 paris-bordeaux street race. In spite of the fact that André and édouard didn't win the race, they created prominent enthusiasm for pneumatic Tyres, and Michelin and Cie turned into a main maker of Tyres in Europe. In the meantime, strong elastic Tyres vanished from the interstates, generally on account of legislation that demoralized their utilization since they were hard for the streets.
In 1898 Goodyear Tyre and Rubber company-named after George Goodyear, the pioneer of vulcanized elastic-was framed in America by Frank Seiberling, At that point firestone Tyre and rubber company was begun by Harvey firestone in 1900,other Tyre producers took after. For the following fifty years, automobile tyres were comprised of an internal tube that contained packed air and an external packaging that ensured the inward tube and gave traction. The rubber that made up the packaging was strengthened by layers or "plays" of rubber treated texture strings inserted in the rubber. The tyres made amid this period were known as Nylon Tyres in light of the fact that the ply’s kept running over the Tyre in substituting corner to corner layers at around a 55-degree point to the wheel rim. Nylon tyres keep on being made and are sold as legitimate gear for collectible and gatherer automobiles that were made amid this period.
Michelin first presented steel-belted radial Tyres in Europe in 1948. Radial tyres are so named in light of the fact that the employ strings emanate at a 90-degree edge from the wheel edge, and the packaging is reinforced by a belt of steel texture that circles the perimeter of the Tyre. In radial Tyres, the ply cords are made of nylon, rayon, or polyester. The sides of radial Tyres incorporate longer tread life, better guiding qualities, and less moving obstruction, which builds mileage. Then again, radials have a harder riding quality, and since they are mechanically more intricate than inclination complex than nylon Tyres, they are around 45 % more costly to make. In light of their development, radial tyres require an alternate suspension framework from that utilized via cars intended for inclination nylon Tyres. It is for the most part prescribed that radial tyres not be utilized on cars intended for predisposition nylon tyres.
Throughout the following 20 years, radial Tyres ended up standard on new cars outside of America. Michelin in France, Bridgestone in Japan, Pirelli in Italy, and continental in Germany turned out to be intense radial tyre producers. Car tyres wherever ended up tubeless as tyre innovation made strides,
INDIAN TYRE INDUSTRY
THE FIRST PHASE: (1936 – 1959)
The auto ancillary industry is one of the more critical segments of the rubber assembling industry as it represents just of three-quarter of the aggregate net estimation of the business. The Indian rubber industry is of relatively ongoing inception. The finish of the primary world war flagged the beginning of the business. The principal rubber plant in the nation was appointed in 1920 for the fabricate of certain mechanically less unpredictable non - Tyre items like waterproofing of textures. From that point a couple of concerns developed one after another in the Bengal administration and somewhere else. In any case, it was just in the second half of the 1930's that business creation of Tyres started in the nation.
Dunlop Rubber Company was the first to begin business creation of tyres in the nation their plant was set up at Calcutta in 1936. Dunlop was before long taken after by a US based MNC by name Firestone Tyre and Rubber Co with a plant at Bombay in 1939. Notwithstanding these, two different producers, who were likewise backups of multinational company like Goodyear and India Tyre and rubber co (ITR), additionally entered the shred. Of these, ITR was an auxiliary of Dunlop parent firm and it turned into an entirely possessed backup of Dunlop India just in 1979. Both Goodyear and ITR were getting their tyres fabricated/manufactured at Dunlop plant. Actually, this shared relationship between the organizations in an express way was a typical business response to the monetary changes of the discouragement years and could be discovered somewhere else. For example, Goodyear had courses of action with Dunlop in regard of a few markets as per which one of them made tyres and tubes for the other where it had a conspicuous position.
THE SECOND PHASE :( 1960 -1974)
The highlight of this stage is the permitting of new units, particularly the Indian organizations with outside specialized joint effort and the subsequent cooperation between the set up MNC s and the new Indian organizations. In spite of the fact that the passage of these new firms would have made the business more focused, the conniving game plans between the organizations at settling the costs and sharing the yield kept on assuming a critical part, yet this time with an imperative contrast. The initiation of this stage roughly compares to the start of the third five-year design. The objective for the arrangement time frame was settled at 3.7 million tyres. Along these lines five new units were authorized of this, Goodyear and Ceat were backups of MNCs and staying three (Madras Rubber Factory, Premier and in check) were advanced by Indian business visionaries in specialized coordinated effort with remote organizations .Among them, madras rubber had a minority value investment by its foreign collaborator.
Dunlop Tyres drove the route for firestone of the US, which built up itself in Bombay and later for Goodyear and Ceat of Italy, which were likewise Bombay based. it was just in the mid 1960's that Indian Tyre manufacturer (MRF, Incheck and premier Tyres) broke the restraining infrastructure of the foreign tyre producers. After the 1970's there was an adjustment in the approach of government and it chose not to endorse any foreign equity.
Modi Rubber took after MRF in 1975, after which Apollo Tyres turned into a genuine player. in the interim, the Karnataka state government set up Vikrant tyres in Mysore in specialized joint effort with the UK-based Avon tyres. Premier Tyres has been assumed control by Apollo tyres and Vikrant tyres by J. K. tyres in the late seventies.
The two existing organizations and Goodyear could actualize their licenses much before the new organizations could, in perspective of the previous charge over budgetary and specialized assets. Because of these generous developments and the new units going into business creation, there was an impermanent excess in the Tyre advertise amid the period 1963 through 1967. The customer inclinations were for the set up mark names and accordingly, the new units found are amazingly hard to set up.
THE MODERN PHASE: (1975 – Current)
The recognizing highlight of this stage is the substantial scale passage of units having a place with Indian business houses and the idea of vertical and flat acquisitions. Here happens the exit of MNCs essentially because of outer conditions, the unfavourable execution of their particular parent organizations because of serious recessionary conditions in the western Tyre industry, which saw the exit of the organizations from Indian market. The business experienced a progression of changes which impacted the example of intra-industry rivalry and also influencing the market intensity of specific firms. There are basically seven new participants into Tyre industry amid the period. of these, four vast tyre producers are Modi Tyre, Apollo Tyre, JK Tyre and Vikrant Tyre and three were particular makers of Non Truck tyres like scooter/motorcycle Falcon, Srichakra and KTC . Modi was the first to start business generation by 1974. inside a time of two years or something like that, i.e ., by 1977, the organization could accomplish a noteworthy offer of the truck Tyre showcase which is by a long shot the most imperative portion and develop as the third biggest producer of truck.
The Indian Tyre industry has developed as a standout amongst the most aggressive markets on the world and with the rise of new innovation, ultra-present day creation offices and accessibility of crude materials, the area is ready to become further. Major technological advancement have taken place in tyre structure design from the conventional bias or diagonal ply of the past to the current steel-belted radial tyres, tubeless tyres, tyres with low aspect ratios, puncture-resistant tyres, etc Testing standards have also evolved accordingly to ensure high performance, mileage, safety, reliability and durability of the tyres.. The Indian tyre industry has been snappy in embracing the most recent innovation drifts through remote coordinated efforts and fitting these to Indian needs. The producers are additionally putting resources into the improvement of 'green Tyres' and in limit extension for Radial Tyres. Inventive advances like self-inflation and run flat tyres (RTF) are likewise picking up popularity in the Indian market.
The market for radial tyres in the Heavy commercial vehicles section has seen fast development lately. In the medium and heavy commercial vehicle fragment, the present reception levels of radial tyres are around 15 %. In the light commercial vehicle section, it is evaluated to be 18 %. The passenger car portion changed to radial tyres before, and inside a brief timeframe, infiltration levels achieved very nearly 100 % in PCR (Passenger Car Radial). This section will doubtlessly be the concentration for Indian tyre producers as is relied upon to develop at around 15 % throughout the following couple of years to Rs 393 billion by 2015. .in 2011-12, the Indian Tyre industry recorded a turnover of Rs 300 billion, delivering 119.2 million Tyres, adding up to 1.49 million metric tons. Right now, India has 40 recorded Tyre producer organizations, of which the main Six represent more than 94 % of the nation's aggregate Tyre creation. The tyre trade showcase in India is esteemed at Rs 3.6 billion. While the tyre business is generally ruled by the sorted out part, the chaotic area overwhelms the Motor cycle tyre showcase. With the attention on giving better product and services, Indian Tyre makers are setting up very much prepared in-house Research and development centres with accentuation on creating front line innovation for new compound, new outlines for various portions and new support materials. cost streamlining for quality enhancements and introduction towards changing client prerequisites are likewise area of research.
The local tyre industry is relied upon to post volumes development of 7-8 % to 1,805 lakh Tyres amid fiscal year 2018, regardless of the feeble volumes amid the primary quarter and part of the second quarter amid GST rollout. in tonnage terms, Tyre demand is assessed to grow 7 % amid fiscal year 2018, upheld by a get in TBB replacement demand after more than two long stretches of frail development and for fiscal year 2019, the unit and tonnage development is pegged at 8-8.5 % and 6.5-7 %, individually, according to an ICRA Limited (formerly Investment Information and Credit Rating Agency of India Limited) note.
Tyre volumes over all the business fragments de-developed amid the primary half if fiscal year 2018, because of goods and service tax (GST) usage, which affected the main quarter of fiscal year 2018 request because of de-stocking by merchants. Anyway excepting this transient variation, the domestic tyre demand has stayed positive amid the year and liable to recuperate in the second half of fiscal year 2018. Further a bounce back in automotive production over the product sections is relied upon to have a falling effect on OEM Tyre demand amid the year.
INDIAN TYRE MARKET DYNAMICS
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Vehicle Sales |
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Scrapping Rate/Vehicle Lifecycle |
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Vehicle Production |
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No of Tyre per Vehicles |
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OE Tyre Demand (LV) (MHCV)
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Total Tyre Demand
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Replacement Tyre Demand (LV) (MHCV) |
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Vehicle Purchase |
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Replacement Ratio |
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Production of Tyres |
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Trade In Tyre |
Fig: 1 Driver of Tyre Demand
The OEM (Original Equipment Manufacturer) is the first maker of a vehicle's segments, thus OEM auto parts are indistinguishable to the parts utilized as a part of delivering a vehicle. Reseller’s exchange parts are created by different merchants and don't really have a predictable level of value or similarity with the vehicle.
The overwhelming venture driven tyre industry contributes 3 % of the assembling GDP when the whole automotive represents 7.1 % of the GDP and very nearly 49 % to the country's manufacturing GDP (fiscal year 2015-16). Tyre demands starts from two end-client classes - OEMs and the replacement market. Demand from the substitution portion commands the Indian tyre contributing around 56 % of the aggregate volume, while the OEMs represent the rest 44 percent. Utilization by OEMs is subject to new vehicle sales drift while the substitution fragment is connected to use examples and substitution cycles. In the general offers of tyres in unit terms, the business section contributes around 21 % while the rest of the originates from offers of individual vehicles which incorporates passenger vehicles, two and three wheelers. Under individual portion, two and three wheelers constitute around 55 % sales while the passenger autos compensated for the rest sales. TBB (Trucks & Buses) rules general business utilization section with took after by LCV fragment. Tractor front, Tractor Trailer and Tractor Rear tyre portion constitute the remaining .Top 10 organizations represent around 80 % of the piece of the overall industry. Top three organizations - MRF, Apollo Tyres and JK Tyres - have 55 % of the share of the overall industry of the Indian tyre industry and figure among the main 25 worldwide organizations as far as revenue.
India has forced hostile to dumping obligation on import of certain sort of radial tyres utilized as a part of transports and trucks to shield local makers from beneath cost shipments from China for five years. The against dumping obligation has been forced in the scope of $245.35 - 452.33 for every ton, said a notice issued by the Central Board Excise and Customs (CBEC). Nations force hostile to dumping obligations to monitor local industry from surge in underneath cost imports. India has likewise forced comparable obligations on import of a few different items including steel, textures and synthetics from various nations including China. Anti-dumping steps are taken to guarantee reasonable exchange and give a level-playing field to the domestic business. They are not a measure to confine import or cause an unjustified increment in cost of tyres.
According to reports, tyre OEM section is required to witness higher development in the following two fiscals fuelled by strong movement in automobiles industry sales. With stable vehicle sales, the tyre business is set to pick up in the OEM space. A Care Ratings report said tyre makers providing to Commercial Vehicle, Passenger Vehicle, and Tractors section are relied upon to profit the most in the close term as the viewpoint for these auto portion in the Indian Market is generally more positive. With stable vehicles sales, the tyre business is set to pick up in the OEM space. Then again, the report recommended by fiscal year 2019, about Rs 70 billion worth undertakings are to be finished including 12 million unit ability to the business.
ATMA said the tyre business being a vital piece of the auto ancillary business is probably going to achieve levels of Rs 2,074-2,423 billion by 2026. As per data from Automotive Tyre Manufacturers Association (ATMA), general capex incorporates Rs 14,734 crore which was spent on as of recently finished activities while another Rs 20,630 crore is put resources into continuous Greenfield ventures. A further Rs 15,743 crore is put resources into progressing Brownfield ventures. Of this general limit expansion, passenger and light truck radials involve the huge offer in volumes with 55, 00,000 units of which 21,18,000 units have been as of recently appointed while 20, 80,000 units will originate from continuous Greenfield ventures. Another 13, 02,000 units will roll in from progressing Brownfield ventures.
Tyre sends out are evaluated to develop by 8-10 %throughout the following three years drove by stable request and expanded acknowledgment of Indian tyres in overseas markets, both as far as quality and valuing. It was around 9 % in fiscal year 2018. In any case, with rising entrance of minimal effort Chinese tyres in abroad markets, particularly post the expulsion of against dumping obligation (ADD) by the US on the Chinese tyres in February 2017, rivalry from China (both regarding volumes and evaluating) will remain a key test, according to and ICRA note.
For fiscal year 2019, the unit and tonnage development is pegged at 8-8.5 % and 6.5-7 for each penny, separately. At present, India's commitment to the worldwide tyre exchange is USD 1.5 billion (1.72 %) out of the $80 billion market. ATMA anticipates that Import share will increment to around 5 % given that the business is exceedingly focused and there is headroom for tyre sends out. Top goals for trades incorporate US, Germany, France, UK, Italy, Spain, Turkey, Netherlands, UAE, Brazil and Australia. The US and EU nations are the best potential markets for sends out, and the driving component would be the Government consenting to exchange arrangements with these nations which can give concessional tariff to tyres.
The Annual Survey of Industry (ASI), MOSPI information uncovers that the tyre business gives guide work to in excess of 0.15 million individuals, which is around 0.12 million in the sorted out part. It likewise gives work to more than 1 million individuals, for example, Retreaders, Dealers, Distributer, Mechanics, Fitters and repairers straightforwardly and by implication related with the business.
Table 1: Tyres Plant location in India.
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APOLLO TYRES · Limda, Gujrat · Perambra ,Kerala · Kalamessery,Kerala · BIRLA TYRE · Balasore ,Orissa BRIDGESTONE · Dhar , Madhya Pradesh · Pune , Maharashtra CEAT TYRE · Mumbai ,Maharashtra · Halol ,Gujrat · Amabarnath ,Maharashtra · Nasik , Maharashtra · Nagpur , Maharashtra CONTINENTAL TYRE · Modipuram, Uttarpradesh GOODYEAR · Ballabhgarh ,Haryana · Aurangabad, Maharashtra |
JK TYRE & INDUSTRIES LTD · Kankroli , Rajasthan · Banmore , Madhaya Pradesh · Mysore (2) ,Karnataka · Sriperumbudur,Tamil Nadu · Haridwar , Uttarkhand MICHILEN · SIPCOT Thiruvallur, Tamilnadu
MRF · Chennai ,Tamilnadu · Arkon ,Tamilnadu · Trichy ,Tamilnadu · Puducherry · Medak,Telegana · Ponda ,Goa · Kottayam ,Kerala TVS TYRES · Rudrapur, Uttarakhand · Madurai ,Tamilnadu YOKHAMA · Bhadurgarh ,Haryana |
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Source: Automotive Tyre Manufacturers’ Association (ATMA) |
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Review of Literature
Indian Tire Industry is oligopolistic which mean there are few firms in a market. This firm battle to take the biggest piece of the market, firm need particular arrangement which we called strategies which utilized to support up their growth and profit. Tyre firm needs distinctive systems that outflank its rivals.
Sunil Mani (1985), In spite of the fact that modern fixation at the firm and business house levels has been examined, no endeavour has so far been made, in the important writing, to relate impacts of rising focus to showcase direct factors like the pricing behaviour of firms. The motivation behind the paper is to follow the rising fixation in the tyre business and its resultant impacts on the pricing behaviour of firms. The business which was ruled by MNCs has now come to be overwhelmed by Indian business houses and the ongoing even and vertical incorporations by a portion of the organizations have added another measurement to the fixation.
Author centre mainly around the level and to a specific degree the determinants of fixation at tyre industry as per standard economic theory monopoly capitalism is criticized on that ground that increasing industrial concentration leads to unduly low outputs and excessive high prices and profits ,but this is not true in case as tyres industry are oligopolistic by natures where price behaviour not relates to the concentration of in Indian Tyres market but based on the cost based and competition based pricing as no firm want to lose their market share by abruptly increase prices .fixation of pricing at industry level is not possible as product are identical but each firm has own brand value which associated with product therefore pricing based on their commercial policy . as author conclude that government tried to deconcentrate the industry by licensing more but for that huge investment and technological advancement needed which is not possible in this dynamic technological world this cause government sold the Vikrant plant to JK Tyres & Industries LTD .In Indian Automotive tyre Industry entry and exit in domain are barriers relates to land, investment, technology and manpower.
Brett Boyle, et.al. (1992) the term influences strategies allude to the structure and substance of correspondences by limit faculty in a sourcing firm that is expected to change practices in a channel accomplice named the objective firm. Research around there is essential for three foremost reasons Planning and negotiating for part and rewards alteration are basic aspects of versatile channel framework.
Channel Condition may compel the idea of Communication between individuals
Channel member attitudes, confidence, and system performances are determined.
The authors grow new measures of influence strategies in marketing channels (i.e., the methods by which a company's work force speak with its accomplices to influence their conduct) keeping in mind the end goal to inspect relationship with the quality of purchaser vender connections and alternative governance structures (market, administered, franchise, and corporate). Study 1 was a field trial of the new multi-thing measure of influence strategies in a legally binding channel framework. The outcomes affirm the anticipated negative relationship amongst renationalise and the accompanying influence strategies: threats, legalistic supplications, and solicitations. Study 2 reproduced trial of the psychometric nature of the scales in each of the four types of governance structures (market, administered, franchise, and corporate).The outcomes demonstrate that (1) the recurrence of recommendations, promises and data trade is related decidedly with a worldwide measure of Relationalism (relationalism is any theoretical position that gives importance to the relational nature of things ) and (2) the recurrence of all supplier correspondences vary over the four administration structures. In this research author find out the methods by which a company's work force speak with its accomplices to influence their conduct ,during his study they found negative influence strategies which are threats, legalistic pleas, and requests and positives influences strategies are recommendations, promises, and information exchange but as today’s scenario in Indian Automotive Tyre Industry influences strategies are policy ,pricing and product because without this no sale personnel influence the dealer or distributer to maintain and grow relationalism. Policy bind the dealer towards rule and regulation or framework for business process where product demands and pricing influences him as consumer demands for that so their inclination towards particular company which has aggressive product and responsive pricing.
Robert A, et.al. (1995) Developing markets for a purchaser and industrial products and ventures in India are especially alluring to Western firms. India has in excess of 150 million middle-class customers who have a place with knowledgeable families with extensive obtaining power. In fact, India's market potential surpasses that of a few nations in Western Europe. Firms entering developing nations, for example, India must enlist and prepare local distributor. Essentially, the framework required for productive and successful exchange is deficient. Foreign suppliers normally should make substantial ventures to select and prepare wholesalers/ Distributer. According to NCAER, India's middle class population would be 267 million in 2016. Further ahead, by 2025-26 the number of middle class households in India is likely to more than double from the 2015-16 levels to 113.8 million households or 547 million individuals which shown that India has consumer economy which has immense potential therefore to reach all this robust distribution system needed which requires channel network of dealer and Distributer ,In context of Indian Automotive tyre Industry foreign company which interesting to enter in Indian market need a distribution system of dealer and Distributer to reach consumer .Author research working with dealer In India give significant idea but in today world as already many foreign suppliers enter into market therefore concrete strategy to outperform competitor.
Christopher S. Calhoun, et.al. (1997).The utility of a survey method which consolidates a few diverse interview techniques to inspire information in unique situations is illustrated. Adaptive survey is a blend of concept mapping, semi-organized interviews, topical questionnaires and discussions utilized for the elicitation of information from topic specialists. Innate in adaptive survey interview techniques is the adaptability to adjust to time requirements, schedule and interviewee changes and the level of data got. Each meeting techniques is intended to apply to any client in the survey and to deliver yield which can be utilized to tweak alternate techniques. Therefore, the adaptive survey can be customized to the one of a kind needs and requirements of the interviewees and nature. In field tests, idea mapping turned out to be an especially important meeting strategy, since it was interactive, informative and flexible, Adaptive Survey Method theory insights to find out the Fitment Survey Method tools for Automotive Tyres by gathering all data through specialists ,sales manager and services engineers all which conclude on essentials components of fitment survey to conduct survey.
Rigby, D. (2001). Management tools can mean several factors, but usually involves a collection of ideas ,process ,exercise and analytical frameworks like strategic coming up with, benchmarking, pay-for-performance, outsourcing, customer segmentation, reengineering, balanced record book, and total quality management garner vital thought within the acknowledge management literature. Organizations throughout the globe pay countless bucks every year implementing a dozen roughly of those tools. there's no equivalent of the patron reports for management to use in evaluating the tools accessible to them .the study aim to provide mangers with associate objective ,fact driven assessment of management tools and techniques based on feedback from the particular user of tools. It identifies tools that are systematically used over time additionally as those who appear to own been passing fads, in this context fitment Survey Method Tools used in this study
Faas, T, et.al. (2004). the article compare about the results of three survey that were led in methodologically altogether different routes in the run-up to the last German federal election. The first survey overview is a delegate test of the German population, the second one is an online survey of Internet user, the third one is a spontaneous open online survey with self-chose participants. The examination yields impressive contrasts among the three surveys concerning demographic (age, sex, education) and in addition considerable factors (voting intentions, interest in politics). It is additionally demonstrated that these distinctions keep on existing in the wake of weighting the examples by sex and age , This study insight about that every time online survey not fulfil the purpose therefore field work required for error free data which lead to source of information.
Alberto Sa Vinhas, et.al. (2010).The research writing has gained huge ground toward a superior comprehension of how firms can adequately outline and deal with their channels of dissemination. Be that as it may, the many-sided quality of the present channel frameworks raises extra issues that stay unaddressed. The reason for this article by author was to recommend promising exploration bearings in this space. Author recommended a few conceivable roads to relate numerous channel outline and administration to channel-framework, channel-relationship, and client level results. Specifically, author seen an awesome chance to incorporate multichannel client administration and conventional channel configuration examine. Author contends that future research should represent cross-level impacts and join factors at in excess of one relationship level. All this factors as per Indian automotive tyre industry channel design, coordination, and performance are key factors but this is based on some variables which requires understanding the need for effectively design, coordinating and performing the channel management.
Bolton, et.al. (2010).Pricing strategy is that the policy a firm adopts to work out what it'll charge for its product and services. Strategic approaches fall broadly speaking into the three classes of cost-based pricing, competition-based pricing, and value-based pricing. Pricing strategy could be a key variable in financial modelling that determines the revenues achieved, the profits attained, and therefore the amounts reinvested within the firm's growth for its long-run survival. variety of rating strategy choices area unit obtainable, together with mark-up pricing, target come back on investment pricing, perceived worth pricing, competition-based pricing, penetration pricing, and skimming pricing. The selection of pricing ways adopted by the firm can depend upon the general company strategy, purchaser expectations and behaviour, rival strategy, trade changes, and regulative boundaries.
Different factors touching the character of pricing ways area unit company image, geography, value discrimination, and price sensitivity. Future trends in pricing policies area unit probably to specialise in information-based improvement through price reduction of inefficiencies within the provide chain, the reduction of trade allowances, a rise in responsiveness to changes in market conditions, larger pricing flexibility, and a discount of pricing inequality across completely different channels.
Shubhangi Rajput Sharma (2011).She centres around four primary focuses Determination of market attributes, Measurements of market potential/request projection, Market share estimation and Sales technique and arrangements .she announced that channel appropriation, Technology, assessing complete potential and region potential, a tire organization has to know the real business deals happen in the market, these methods distinguishing and evaluating their deals. In the tire business item/product quality and Services, are particularly related. An amazing item requires fewer services and low-quality services item/product requires more services. The four variables which she considers are theoretical in sense which requires some concretes variables to increase sales which are implementation by nature.
Dhruv Bhardwaj, et.al.(2012).To Build Predictive Price‐Volume Model Quantitative Research & Analytics (with an example of Indian Tyre Industry)’ Metamorphosis. Pricing is usually appeared to be a double edge weapon within the hands of marketers. Whereas competitive pricing strategy might fuel demand within the short term, it should ultimately erode brand equity, precipitate price battle resulting in commoditization of category. However, pricing choices taken once due objective thought of brand equity and relative market positions viz., leader, challenger or follower brand position may very well identifying brands build dominant positions within the market distinguishing the correct worth connected to its worth proposition will for certain facilitate brands build sustainable differentiation within the long haul. This paper based on short term benefits but not consider long term benefits as alone pricing is not leads to sustainable development.
As per author the organization charging segment would charge the tire to the nearest merchant, who might book it to the Customer site. Credit farthest point of the merchant is considered while charging if no restriction check would be stored by the time. In the event that the client is positioned in the place of the Dealer, after he/she choosing the Tire they would gather the Tire from the organization premises to evade delay in Time. This could be the solution for saving time and money to the Customer. This is one of good suggestion by authors but it not increase the sales as except than few segment based on dealer customer relationship and credit facilities. Therefore author suggest an option but not a strategies to increases market share or gain momentum.
Dr. Praveen Srivastava , et.al (2015). Turnaround system is a corporate practice composed and intended to ensure a misfortune, making organization and change it into a benefit making one. On the off chance that we center around any assembling organization which is experiencing misfortunes because of abundance sit without moving time taken by the works to finish their employment or because of extreme lazy offering group or exceptionally terrible strategies related with the after deals benefit or the mind boggling arrangements of landing cost of the item, the organization will take after turnaround system to lessen work latency by introducing current machines or by enrolling another offering group or give great preparing to old group. In the event of terrible arrangements for a benefit, the organization needs to turnaround by presenting intemperate new approaches which ought to be more positive for existing clients. Further, in the event of the insufficient landing cost of the item, the organization should pivot in the manner in which that costs of the item are most reasonable and gainful for the merchants. Modi Rubber Ltd was a major concern and because of a few reasons, it confronted overwhelming misfortunes in 2001 and from that point forward it is relatively out of the vehicle to advertise. Modi Rubber is, notwithstanding, taking a gander at recapturing ownership of the organization's Modinagar industrial facility, to reappear the market for the cruiser, tractor and light business vehicle (LCV) tires. This paper centers the merchant's recognition towards turnaround systems of Modi Rubber Ltd, that this organization can support in the current showcase situation and it can get its past administration with in excess of 20% offer in the Indian Tire Market. During this study it has been observed by authors very closely that the dealers are still interested to sale the product of Modi Rubber Ltd, if they maintain their quality. Further, it is seen that the sole dealers are more anxious to sale the product of MRL as compare to multi product dealer, this study limited to a particular domain where dealer interested to sell Modi Rubber Ltd tyres but not conclude how this happen as dealer profit is not sole criteria to gain market share by Modi Rubber Ltd. This study domain limited to agra region and no concrete turnaround strategy suggested by authors.
Bakhare and Bisen's (2019) study on customer satisfaction with Apollo Tyres in Nagpur City highlights the critical role of customer satisfaction in influencing brand loyalty, repeat purchases, and positive word-of-mouth. Their research examines factors such as product quality, pricing, brand reputation, and after-sales service, which align with broader studies in the tyre industry emphasizing these as key determinants of consumer preferences. Apollo Tyres has consistently ranked high in customer satisfaction surveys, such as the JD Power 2018 India TCSI study, which recognized the brand's leadership in the small car segment due to its focus on quality and innovation. Furthermore, comparative studies reveal that Apollo Tyres performs competitively against other brands like MRF and Ceat, particularly in aspects like durability, comfort, and overall performance. These findings underscore the importance of maintaining high standards in product quality and customer service to sustain market competitiveness.
Vanaja and Anandakrishnan (2021) conducted a study focusing on customer satisfaction with Michelin tyres in Coimbatore City, emphasizing the importance of evaluating customer attitudes, preferences, and satisfaction levels. The research highlighted Michelin's reputation for quality, safety, and performance across various road conditions, which has led to high customer satisfaction and loyalty. The study revealed that Michelin tyres are perceived as a reliable choice for diverse vehicle types, offering stability and comfort. It concluded that satisfied customers are likely to continue preferring Michelin tyres in the future due to their positive experiences with the brand.
The study by Gong, Liao, and Sattabut (2022) explores the interplay between consumer psychology and marketing strategies in online retail, emphasizing how psychological principles can enhance customer engagement and conversion rates. Drawing on concepts like the stimulus-organism-response (SOR) theory, it highlights how stimuli such as product promotions and immersive shopping experiences influence consumer behavior, including impulsive purchases. The research underscores the role of tailored marketing strategies, such as leveraging emotional triggers and personalization, to align with consumer preferences and decision-making processes. Additionally, it aligns with findings from related studies that emphasize the impact of factors like online reviews, brand loyalty, and demographic characteristics on purchasing decisions. This work contributes to a deeper understanding of how psychological insights can be strategically applied to optimize online retail performance.
The study by Dr. G. Sathiyamoorthy and Raja R. (2024) in the Business and Finance Journal explores customer satisfaction with MRF Tyres in Tirupur city, focusing on factors such as price, grip, comfort, quality, and durability. Using a survey of 120 respondents and employing tools like one-way ANOVA and percentage analysis, the research highlights that most customers are influenced by word-of-mouth recommendations and are generally satisfied with MRF's product features. The study underscores the importance of media outlets in shaping consumer decisions and suggests that MRF Tyres is perceived as a brand offering comfort and reasonable pricing. It also identifies significant correlations between customer demographics (e.g., age) and satisfaction levels with specific tyre attributes. Previous studies in Coimbatore and Karumathampatti corroborate these findings, emphasizing MRF's strong brand preference due to its quality, affordability, and durability, while also suggesting improvements in showroom services to enhance customer experience.
All above research are based on different strategies and working on dealer but the new era of marketing need concrete strategies to handle the channel network as the competition increase between MNC and Domestic brands, Domestic brands need to Competitive, Retention and Maintain their identity in Market. Marketing Strategies are should be based on below considerations.
Above variable creates need of marketing strategies for Channel Partner especially in contrast of HCV dealer.
Research Methodology
Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. In it we study the various steps that are generally adopted by a researcher in studying his research problem along with the logic behind them. It is necessary for the researcher to know not only the research methods/techniques but also the methodology.
Objectives of the Study
Scope of the Study
Hypothesis
Hypothesis on which study are based as follows
Hypothesis 1
H0. Channel Partner Dealer not bound by any business policy (commercial and discount) or not wants to adhere any policy.
H1. Channel Partner bound to business Policy (commercial and discount) and Adhere by maximum no of dealers or channel partner.
Hypothesis 2
H0. Depth product knowledge and assortment not requirement to channel partner or dealer.
H1. In-depth Product knowledge and assortment is essential to Channel partner or customer.
Hypothesis 3
H0. There is no difference in between MOP (Market operating Price) and MRP (maximum retail price).
H1. There is significant difference in between MOP (Market operating Price) and MRP (maximum retail price).
Universe/Population
Research Design
Descriptive Design used in this study to describe the research problem.
(Descriptive Design which provide the data about the population or universe being studied here but it can only describe the who, what, when, where and how of the situation.)
Sampling Type
Sample Size
Sample Location
Uttar Pradesh and Uttarakhand region at a specific location, which is, based on location of Sale Depot of Birla tyres and Channel Partner or Dealer which compromise of UP West & Uttrakhand as region.
Haldwani
Muzzafarnagar
Dehradun
Hapur
Merrut
Bareilly
Ghaziabad
Moradabad
Data Type
Questionnaire
Fitment Survey Method (Heavy Commercial Vehicles) is a Survey Method, which is used, for gathering current fitment data, which stored and retrieves for study, where recording of feedback unable though questionnaire and schedule.
Data Analysis and Interpretation
Fitment Survey Method.
Fitment survey is a statistical tool for analyzing and abstract information regarding
To know about the application of different Patterns of tyre respective to vehicles.
To find out customer perspective or Interest towards different Brands of the tyre by seeing their vehicles fitment.
To know about the SOM (Share of Market) and SOC (Share of Customer) in a specific location. Components or Entities used in Survey Method -Fitment Survey, tools are essential component to carry out the survey of Heavy Commercial Vehicles by study all aspects relates with survey. These are based on 12 components which mention below.
|
Table 2 :- For 6X2 or 6X4 Vehicle Tyre Positions |
|
|
FL |
Front Left |
|
FR |
Front Right |
|
RRO |
Rear Right Outer |
|
RRI |
Rear Right Inner |
|
RLO |
Rear Left Outer |
|
RLI |
Rear Left Inner |
|
DUM-RLO |
Dummy Rear Left Outer |
|
DUM-RLI |
Dummy Rear Left Inner |
|
DUM-RRO |
Dummy Rear Right Outer |
|
DUM-RRI |
Dummy Rear Right Inner |
As per the fitment survey which in had done on 1915 no’s HCV Vehicles mean 10137 tyre Sample at Eight different location of UP West & Uttrakhand was gathered.
Fitment Survey is Survey Method which was used for recorded the response of object which response where Questionnaire and Schedule unable to do it help both in the finding and learning all related prospects of Market Shares. It helps in recorded data to further analysis as per need.
|
Table 03: Result of Market Share from Fitment Survey Data. |
||||||||
|
UP West & Uttrakhand |
BIRLA |
MRF |
ATL |
JKI |
CEAT |
CONTI |
OTHERS |
Total |
|
OCT' 17 |
743 |
1098 |
472 |
234 |
200 |
284 |
89 |
3120 |
|
Percentage |
23.80% |
35.20% |
15.20% |
7.50% |
6.40% |
9.10% |
2.80% |
|
|
JAN'18 |
927 |
1081 |
645 |
230 |
216 |
252 |
85 |
3436 |
|
Percentage |
26.98% |
31.46% |
18.77% |
6.69% |
6.29% |
7.33% |
2.47% |
|
|
Apiril'18 |
867 |
1022 |
911 |
245 |
258 |
248 |
30 |
3581 |
|
Percentage |
24.21% |
28.54% |
25.44% |
6.84% |
7.20% |
6.93% |
0.84% |
|
|
Combined |
2537 |
3201 |
2028 |
709 |
674 |
784 |
204 |
10137 |
|
Average Percentage |
25.03% |
31.58% |
20.01% |
6.99% |
6.65% |
7.73% |
2.01% |
|
|
*Primary data based on fitment survey method. |
||||||||
From the above table we find out the market share of each tyres manufacturer, this data shown the fitment survey result of different three months of three quarter from the year 2017-18, as per this highest market share was enjoy by MRF which is followed by Birla Tyres in HCV TBB Segment as both have above 50% cumulative market share which shown market is highly concentrated towards two brands in UP West & Uttrakhand. As per concentration, there is a chance of oligopolistic competition.
Determining Whether an Oligopoly Exists
An oligopoly is defined, not by the size of the firms, but by their relative market shares. Essentially, if relatively few firms control most of the market sales, then an oligopoly exists. One commonly used measure of market concentration is the Herfindahl-Hirschman Index (HHI), which is defined as:
HHI =
Where :
Si denotes the percent of the market controlled by the ith firm
N denotes the number of firms in the market.
As per the Fitment Survey Method data
|
Table 04: Market Share of Indian Automotive Tyres Manufactures. |
|||
|
Tyre |
Market Share (%) |
HHI |
|
|
BIRLA |
25.03 |
627 |
|
|
MRF |
31.58 |
997 |
|
|
APOLLO |
20.01 |
400 |
|
|
JKI |
6.99 |
049 |
|
|
CEAT |
6.65 |
044 |
|
|
CONTINENTAL |
7.73 |
060 |
|
|
OTHERS |
2.01 |
004 |
|
|
Total |
100% |
2182 |
|
|
*Calculation based on primary data of fitment survey method |
|||
According to the DOJ-FTC 2010 Horizontal Merger Guidelines, the agencies will regard a market in which the post-merger HHI is below 1500 as "unconcentrated" between 1500 and 2500 as "moderately concentrated," and above 2500 as "highly concentrated.
Hence market is moderately concentrated HHI <2500, It mean the market is oligopolistic and strategies adopted to conquer or outperform competitor is based on oligopoly theory.
Secondary Data
This is data which is collected through the Marketing Department, Dealer and field Sales Personnel of Birla Tyre to analysis the behaviour of the market towards the perspective of the dealer because the dealer is medium between company and consumer. The dealer influences the customer as their relationship is maintained with the customer since long time and dealer also provide credit facilities to that customer.
This data is secondary and related to the policy of Birla Tyre and there adherence by dealers with respect to policy during 2017 - 2018, Product sales of highly selling tyres of HCV TBB eg 10.00-20 (16 PR) ZETA with respect to UP West & Uttrakhand sale average. These products categorize by their load capacity which are Heavy Load, Standard Load and Moderate Load, the pricing structure as per commercial and trade policies declared by a company of selected tyres, through this we analysis this variable behaviour in a different region of UP West & Uttrakhand for abstracting the desired information.
Policy
A set of policies are principles, rules, and guidelines formulated or adopted by an organization to reach its long-term goals. Here policies related to the commercial policies and trade policies through the company for their trade partner or channel partner.
In this table data shown of seventy dealers all across the UP West & Uttrakhand and their adherence percentage of policies of Birla Tyre, as per company policies, dealer get maximum benefits of all core commercial policies when he rotates their CPA (Commitment Plan Advance). Which mean first a dealer committed a minimum amount of business with company per month as per company policies eg if dealer wants all categories of tyres from Birla Tyre his minimum commitment will be Three lacs .it mean to get all discount of core policy must do their rotation than comes the trade policy which is boost sales through short-term discount by offering some gifts and incentive. The table showed the data of two trade policies by Birla Tyre during 2017 -18 and their adherence by dealers.
|
Table 5: Policy Adherence data of Heavy Commercial Vehicles Tyres Dealers in UP West & Uttrakhand . |
|||||||||
|
|
CPA Rotation 2017-18 |
GOLD COIN 2017-18 |
GOLD VOUCHER 2017-18 |
||||||
|
Territory |
Total Dealer |
Followed |
% |
Total Dealer |
Followed |
% |
Total Dealer |
Followed |
% |
|
GHAZIABAD |
7 |
2 |
28.57% |
7 |
4 |
57.14% |
7 |
3 |
42.86% |
|
BAREILLY |
8 |
4 |
50.00% |
8 |
4 |
50.00% |
8 |
5 |
62.50% |
|
DEHRADUN |
8 |
4 |
50.00% |
8 |
5 |
62.50% |
8 |
4 |
50.00% |
|
HALDWANI |
15 |
9 |
60.00% |
15 |
5 |
33.33% |
15 |
8 |
53.33% |
|
HAPUR |
7 |
6 |
85.71% |
7 |
7 |
100.00% |
7 |
7 |
100.00% |
|
MORADABAD |
10 |
5 |
50.00% |
10 |
5 |
50.00% |
10 |
5 |
50.00% |
|
MUZAFFAR NAGAR |
6 |
6 |
100.00% |
6 |
5 |
83.33% |
6 |
6 |
100.00% |
|
MEERUT |
9 |
6 |
66.67% |
9 |
6 |
66.67% |
9 |
7 |
77.78% |
|
TOTAL |
70 |
42 |
60.00% |
70 |
41 |
58.57% |
70 |
46 |
65.71% |
|
*Secondary data based on internal marketing report of Birla tyres. |
|||||||||
Chi Square Test (χ2)
From table 06, the below data taken to test the hypothesis regarding the policy adherence by dealer or channel partner.
|
Territory |
P1 Followed |
P2 Followed |
P3 Followed |
Total |
|
GHAZIABAD |
29 |
57 |
43 |
129 |
|
BAREILLY |
50 |
50 |
63 |
163 |
|
DEHRADUN |
50 |
63 |
50 |
163 |
|
HALDWANI |
60 |
33 |
53 |
147 |
|
HAPUR |
86 |
100 |
100 |
286 |
|
MORADABAD |
50 |
50 |
50 |
150 |
|
MUZAFFAR NAGAR |
100 |
83 |
100 |
283 |
|
MEERUT |
67 |
67 |
78 |
211 |
|
TOTAL |
491 |
503 |
536 |
1530 |
Hypothesis
H0. Channel Partner Dealer not bound by any business policy (commercial and discount) or not wants to adhere any policy.
H1 Channel Partner bound to business Policy (commercial and discount) and Adhere by maximum no of dealers or channel partner.
Where P1 :- CPA Rotation 2017-18.
P2:- Gold Coin 2017-18.
P3:- Gold Voucher 2017-18.
The Contingency table 07, of expected frequencies is as follows
|
Territory |
P1 Followed |
P2 Followed |
P3 Followed |
Total |
|
GHAZIABAD |
41 |
42 |
45 |
129 |
|
BAREILLY |
52 |
53 |
57 |
163 |
|
DEHRADUN |
52 |
53 |
57 |
163 |
|
HALDWANI |
47 |
48 |
51 |
147 |
|
HAPUR |
92 |
94 |
100 |
286 |
|
MORADABAD |
48 |
49 |
53 |
150 |
|
MUZAFFARNAGAR |
91 |
93 |
99 |
283 |
|
MEERUT |
68 |
69 |
74 |
211 |
|
TOTAL |
491 |
503 |
536 |
1530 |
|
Chi-square Value χ2 : |
24.33 |
|
Degrees of Freedom : |
14 |
|
P Value : |
0.38552 |
The critical value of χ2 = 23.7 (α = 5% and df = 14)
Since the calculated value of χ2 =24.33 which is greater than critical values, hence the null hypothesis H0 is rejected. This concludes that channel Partner bound to business Policy (commercial and discount) and Adhere by maximum no of dealers or channel partner.
Product
A product could likewise be laid out as a gathering of tangible, immaterial and relate qualities fit for being traded for a value with the adaptability to fulfil consumer and business needs. It is something, which will be offered to a market to fulfil the requirements or needs of the consumer, a few creators layout the term 'Product' inside the accompanying way.
Tyres are not just black round objects made of rubber but are a product of high engineering designed to keep you safe on the roads, being the only point of contact with the roads, the significance of tyres in road safety. Tyres have comes in many sizes as per the specification of vehicles which is based on Indian Tyre Technical Advisory Committee (ITTAC), we can divide into different categories as per vehicles requirement like LCV, SCV, TBB, TBR, MC, TF, TT and RT.
Two basic types of tyres, radial tyres are far superior to bias tyres in terms of economy, safety and performance. All passenger vehicles and most commercial vehicles now use radial tyres but in case of commercial segment ratio of radial and Nylon (Bias) is 40:60. Here’s a brief comparison of the construction and characteristics between radial and bias tyres, as per the construction of two types of tyre.
|
Table 8 : Difference Between Radial and Biased Tyre |
|
|
Radial |
Bias |
|
Ply cords run at a right angle to the circumference of a tyre and steel belts are placed at a various angle to angles to the ply cords. Ply cords and steel belts consist of many rigid triangular truss structures. |
Both ply cords and belt cord run diagonally and consist of unstable pantograph like rhombic structure. |
|
Very rigid overall structure |
Unstable overall structure |
|
Very little Distortion and material friction. |
More Distortion and material friction. |
|
Efficient heat dissipation through steel belt. |
Heat retention by multiple textile belts. |
|
Stable and even contact with the road surface, leading to longer tyre life. |
Uneven road contact and more friction lead to shortened tyre life. |
The two-year sales 2016-17 and 2017-18 analysis of UP West & Uttrakhand Product sale of some selected high selling product of Birla Tyres in TBB HCV segment tyres according to specified load category. It helps to know the buying perception of Dealer of UP West & Uttrakhand towards specified load category. Nine Product selected in three specified categories and two-year sales data result infer the average selling of the particular product.
10.00-20 is the sizes for the HCV vehicles, PR acronyms of ply rating which indicates the strength of tyres cords. In heavy load, category two tyres in which 10.00-20 (18PR) XPL LG last two-year average sale was 3.2% and 10.00-20 (18 PR) ROAD MILER average sale was 1.6% which mean the sale of heavy load category tyres is very less and there average total two-year sale contribution was 4.8%.
In Standard load category five products sale analysis of 10.00-20 (16PR) BT 339 last two year average sale was 9.4%, 10.00-20 (16 PR) BT 112 last two year average sale was 9.6%,10.00-20(16 PR) BT 112 PLATINUM last two years average sale was 13.7%, 10.00-20 (16 PR) ZETA + DLX last two year average sale was 26.1% and 10.00-20 (16 PR) TISON DLX last two year average sale was 7.3% .the total contribution to sale of this category of last two year average was 66.1% which was maximum contribution among all category.
In moderate load category two product sale analysis of 10.00-20 ULTRA-DRIVE PLATINA last two-year average sale was 4.4%, 10.00-20 ULTRA MILER last two year average sale was 11.8% and total contribution by this category as per last two year average sales data was 16.2%.
|
Table 09: UP West & Uttrakhand region sale data as per different load categories of TBB Tyres. |
||||
|
Load Category |
Product |
Sale 2016-17 |
Sale 2017-18 |
Average of Sale |
|
Heavy Load |
10.00-20 (18PR) XPL LG |
4.90% |
1.30% |
3.20% |
|
10.00-20 (18 PR) ROAD MILER |
2.50% |
0.60% |
1.60%
|
|
|
Standard Load |
10.00-20 (16PR) BT 339 |
9.20% |
9.70% |
9.40% |
|
10.00-20 (16 PR) BT 112 |
9.80% |
9.50% |
9.60% |
|
|
10.00-20(16 PR) BT 112 PLATINUM |
15.50% |
11.80% |
13.70% |
|
|
10.00-20 (16 PR) ZETA + DLX |
23.90% |
28.60% |
26.10% |
|
|
10.00-20 (16 PR) TISON DLX |
4.90% |
9.90% |
7.30% |
|
|
Moderate Load |
10.00-20 ULTRA DRIVE PLATINA |
3.90% |
4.90% |
4.40% |
|
10.00-20 ULTRA MILER |
9.50% |
14.40% |
11.80% |
|
|
|
OTHER TYRES |
16.00% |
9.50% |
12.90% |
|
*Secondary data based on internal marketing report of Birla tyres. |
||||
All of data from each region of specified territory the individual region analysis with UP West & Uttrakhand region to analysis the sales pattern or dealer buying behaviour which give insight about consumer demand and their choice which further observed through ANOVA Test.
|
Table 10: Load Categories Comparison w..r.t to UP West & Uttrakhand Region |
||||
|
Load / Region |
Heavy Load |
Standard Load |
Moderate Load |
Other Tyres |
|
Meerut |
1.50% |
59.00% |
24.00% |
15.50% |
|
Muzaffarnagar |
4.10% |
71.10% |
13.70% |
11.10% |
|
Ghaziabad |
2.00% |
69.40% |
20.80% |
7.80% |
|
Hapur |
2.30% |
75.80% |
15.10% |
6.80% |
|
Haldwani |
12.70% |
53.60% |
10.70% |
23.00% |
|
Dehradun |
8.80% |
33.90% |
32.40% |
24.90% |
|
Moradabad |
3.20% |
58.40% |
20.30% |
18.10% |
|
Bareilly |
1.10% |
83.30% |
11.50% |
4.10% |
|
UP West & Uttrakhand |
4.80% |
66.10% |
16.20% |
12.90% |
One-Way Analysis of Variance (ANOVA Test)
H0. Depth product knowledge and assortment not requirement to channel partner or dealer.
Ha. In-depth Product knowledge and assortment is essential to Channel partner or customer. .
|
Load / Region |
Heavy Load |
Standard Load |
Moderate Load |
Other Tyres |
|
Meerut |
1.50 |
59.00 |
24.00 |
15.50 |
|
Muzaffarnagar |
4.10 |
71.10 |
13.70 |
11.10 |
|
Ghaziabad |
2.00 |
69.40 |
20.80 |
7.80 |
|
Hapur |
2.30 |
75.80 |
15.10 |
6.80 |
|
Haldwani |
12.70 |
53.60 |
10.70 |
23.00 |
|
Dehradun |
8.80 |
33.90 |
32.40 |
24.90 |
|
Moradabad |
3.20 |
58.40 |
20.30 |
18.10 |
|
Bareilly |
1.10 |
83.30 |
11.50 |
4.10 |
|
Data Summary |
||||
|
Groups |
N |
Mean |
Std. Dev. |
Std. Error |
|
Heavy Load |
8 |
4.4625 |
4.1269 |
1.4591 |
|
Standard Load |
8 |
63.0625 |
15.3753 |
5.436 |
|
Moderate Load |
8 |
18.5625 |
7.3329 |
2.5926 |
|
Other Tyres |
8 |
13.9125 |
7.7044 |
2.7239 |
|
|
|
|
|
|
|
ANOVA Summary |
|||||
|
Source of Variation |
Degrees of Freedom |
Sum of Squares |
Mean Square |
F-Stat |
FCritical Value at 5% F(3,28) |
|
DF |
SS |
MS |
|||
|
Between Groups |
3 |
16279.34 |
5426.45 |
59.2148 |
2.9467 |
|
Within Groups |
28 |
2565.923 |
91.6401 |
|
|
|
Total: |
31 |
18845.26 |
|
|
|
Since the Calculated value of F is 59.2148, which is greater than its Critical value of 2.9467 at α = 5% with d.f. at df1 =v1=3 and df2 =v2=28, Hence the Hypothesis H0 rejected. This concludes that depth product knowledge is required by dealer or Channel Partner.
Pricing
|
TABLE 11: TBB products Net Dealer Pricing of Birla Tyres |
||||||||||||
|
MATERIAL DESCRIPTION |
TYRE |
TUBE |
FLAP |
PD |
NET |
GST 28% TYRE FLAP |
1 TYRE FLAP |
PD 2% TUBE |
NET NDP TUBE |
GST 18% TUBE |
1 TUBE |
1 TTF TYRE |
|
10.00-20 (16PR) BT 339 |
9421 |
1080 |
296 |
194 |
9523 |
2666 |
12189 |
22 |
1058 |
191 |
1249 |
13438 |
|
10.00-20(16 PR) BT339 + |
9540 |
1168 |
323 |
197 |
9666 |
2706 |
12372 |
23 |
1145 |
206 |
1351 |
13723 |
|
10.00-20 ULTRA MILER (16PR) |
9911 |
1168 |
323 |
205 |
10029 |
2808 |
12838 |
23 |
1145 |
206 |
1351 |
14188 |
|
10.00-20 (18 PR) ROAD MILER |
10044 |
1168 |
323 |
207 |
10160 |
2845 |
13004 |
23 |
1145 |
206 |
1351 |
14355 |
|
10.00-20(16 PR) TISON DLX. |
9686 |
1080 |
323 |
200 |
9809 |
2746 |
12555 |
22 |
1058 |
191 |
1249 |
13804 |
|
10.00-20(16 PR) Tarzan. |
10386 |
1080 |
323 |
214 |
10495 |
2939 |
13433 |
22 |
1058 |
191 |
1249 |
14682 |
|
10.00-20(16 PR) BT 112 |
9904 |
1080 |
323 |
205 |
10022 |
2806 |
12829 |
22 |
1058 |
191 |
1249 |
14078 |
|
10.00-20(16 PR) ZETA + |
10036 |
1168 |
323 |
207 |
10152 |
2843 |
12994 |
23 |
1145 |
206 |
1351 |
14345 |
|
10.00-20(16 PR) BT 112 PLATINUM |
10349 |
1168 |
323 |
213 |
10459 |
2928 |
13387 |
23 |
1145 |
206 |
1351 |
14738 |
|
10.00-20(16 PR) BT ULTRA+ |
10768 |
1168 |
323 |
222 |
10869 |
3043 |
13913 |
23 |
1145 |
206 |
1351 |
15263 |
|
10.00-20 ULTRA DRIVE (16PR) |
10894 |
1168 |
323 |
224 |
10993 |
3078 |
14071 |
23 |
1145 |
206 |
1351 |
15421 |
|
10.00-20 (18PR) XPL LG (DOM) |
11118 |
1168 |
323 |
229 |
11212 |
3139 |
14352 |
23 |
1145 |
206 |
1351 |
15702 |
|
10.00-20 (18 PR) KALAPATTHAR |
12155 |
1080 |
323 |
250 |
12228 |
3424 |
15652 |
22 |
1058 |
191 |
1249 |
16901 |
|
*Secondary data based on internal marketing report of Birla tyres. |
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Pricing encompasses a vast impact on profitableness. Pricing methods vary significantly across industries, countries and customers. However, researchers typically concur that pricing ways will be classified into Two groups:
The pricing is cost-based with consideration of competitor based pricing, in tyre manufacturing in which all cost related components calculated on a timely basis to compute the real-time cost, therefore, this also called dynamics pricing. Pricing is computing on the basis of raw material (carbon black, crude oil and rubber prices), operating cost and labour cost etc. Table shown the pricing structure of Truck and Bias Tyres (TBB) of Birla tyre in which material description indicates the Stock Keeping Unit (SKU) mean individual tyres description as Ply rating, Sizes and product names, each tyre has come from factory in a set of Tyre, Tube and Flap so 1TTF mean one set which price is mentioned in above table with respect to each product.
Company provide the NDP (Net Dealer Price) of tyres, tube and flap on which as per commercial policies upfront 2% product discount given after that the GST (Goods and Service Tax) charge as per current policy it is 28 % on Tyre and Flap, 18 % on Tube therefore after minus product discount from NDP (Net Dealer Price) and adding GST (Goods and Service Tax) respectively pricing of product to dealer calculates.
The commercial policy defines the net landing pricing (realisation of all discount structure) of a particular product to the dealer which has many components with the specified condition to follow to reach that discount level slabs. For instances One TTF (Tyre, Tube and Flap) NDP of 10.00-20 BT 339 is Rs13438/- if dealer get bills tyre before 21st of every month so discount of 0.50% was credit on invoice through system automatically which in case of 10.00-20 BT 339 is Rs 67/- , Rotation Schemes relates to the CPA (Commitment Plan Advances) monthly rotation which is amount deposited in company for security deposited which interest also given by company in way of discount, therefore, Rs 108/- of Rotation Schemes and Rs 100/- of Interest discount get by dealer if follow the terms and condition.
PPD acronym of Prompt Payment Discount it mean if dealer pay the amount of invoice within 28 days so he qualifies for 1% discount which was Rs 134/- in case of 10.00-20 BT 339 after deduction of all this discount so Net Value of one TTF (Tyre, Tube and Flap) 10.00-20 BT 339 was calculates as Rs 13029/-. As per Trade Policy which is specially for TBB (Truck & Bus Bias) discount on all Tyres except Ultra Miller and Ultra Drive Rs 50/ - per tyre discount and on Ultra Miller and Ultra Drive Rs 125/- per tyres only if dealer rotates their CPA (Commitment Plan Advances) as per term and condition of company policy therefore by all Commercial and Trade policy discount the Net landing cost for dealer 10.00-20 BT 339 was Rs 12979/-. Below table was calculation of 10.00-20 Sizes Birla TBB product Net landing cost for the dealer.
|
Table 12: Net Landing of Birla Tyres in TBB Segments. |
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|
MATERIAL DESCRIPTION |
1 TTF TYRE |
EARLY BIRD (0.50%) |
INVOICE TILL 21ST 1TTF |
Rotation Scheme (1% ) |
INTEREST (0.75%) |
28 Days PPD (1%) |
NET Value 1TTF |
TBB SCHEMES |
1TTF Net Landing |
|
|
10.00-20 (16PR) BT 339 |
13438 |
67 |
13371 |
108 |
100 |
134 |
13029 |
50 |
12979 |
|
|
10.00-20 ( 16 PR) BT339 + |
13723 |
69 |
13654 |
110 |
102 |
137 |
13305 |
50 |
13255 |
|
|
10.00-20 ULTRA MILER |
14188 |
71 |
14117 |
114 |
106 |
141 |
13756 |
125 |
13631
|
|
|
10.00-20 (18 PR) ROAD MILER |
14355 |
72 |
14283 |
115 |
107 |
143 |
13918 |
50 |
13868 |
|
|
10.00-20(16 PR) TISON DLX. |
13804 |
69 |
13735 |
111 |
103 |
137 |
13384 |
50 |
13334
|
|
|
10.00-20(16 PR) Tarzan DLX. |
14682 |
73 |
14609 |
116 |
110 |
146 |
14237 |
50 |
14187 |
|
|
10.00-20(16 PR) BT 112 |
14078 |
70 |
14007 |
113 |
105 |
140 |
13649 |
50 |
13599 |
|
|
10.00-20(16 PR) ZETA + DLX |
14345 |
72 |
14273 |
115 |
107 |
143 |
13908 |
50 |
13858 |
|
|
10.00-20(16 PR) BT 112 PLATINUM |
14738 |
74 |
14664 |
118 |
110 |
147 |
14289 |
50 |
14239 |
|
|
10.00-20(16 PR) BT ULTRA+ |
15263 |
76 |
15187 |
123 |
114 |
152 |
14799 |
50 |
14749 |
|
|
10.00-20 ULTRA DRIVE PLATINA |
15421 |
77 |
15344 |
124 |
115 |
153 |
14952 |
125 |
14827 |
|
|
10.00-20 (18PR) XPL LG |
15702 |
79 |
15624 |
126 |
117 |
156 |
15224 |
50 |
15174 |
|
|
10.00-20 (18 PR) KALAPATTHAR |
16901 |
85 |
16817 |
136 |
126 |
168 |
16387 |
50 |
16337 |
|
|
26/06/2016 TTF:- TYRE ,TUBE AND FLAP SET *Secondary data based on internal marketing report of Birla tyres. |
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Conclusions
Indian Tyre Industry is oligopolistic which was finding through the HHI index which means few firms like MRF, Apollo JK, CEAT, BIRLA and Continental has fulfilled most of market demand. These major tyre player fight to take the largest part of the Market, the characterises of oligopolistic market works on following assumptions
There are many firms in the Oligopolistic Industry.
Each produces a product which is a close substitute for that of the other firm.
Product qualities and advertising expenditure are constant.
Each Oligopolistic believes that if he lowers the price of his product, his rival will also lower the prices of their products and that if he rises they will maintain the price at the existing levels. So if the firm rises its price it will lose some but not all of its customers for the same reason if the firm lowers its prices it will not succeed in luring away the entire customer.
It means in oligopolistic market product identical so qualities and advertising expenditure are taken constant therefore we need to find out other aspects or variable to analysis and conclude on strategies which outperform the competitors. Business relates with profit but its whole meaning not concise only to profit as sustainable development need all other aspects of business which core does not mean only profit therefore to grow and sustain the business need sustainable marketing strategies which lead to grow with business on long way. Jerome E. McCarthy came up with the 4 P's of Marketing Mix by condensing the elements in the Marketing Mix model elaborated by Neil H. Borden into four main categories.
The four categories elaborated by Jerome E. McCarthy were labelled Product, Price, Place and Promotion. This study shown that for effective Channel Management to sustain and grow needed competitive strategy in the context of Marketing Mix were Policy, Product and Price, as promotion is here relates with policy and place its self represent by sealer or channel partner.
Policy :- It is a code of conduct of business and a promotion aspects which mean how to promote ,grow ,sustain and process the business for organization also their aspects which deliver the system to organization as these are norm ,rule and regulation which made discipline the dealer towards organization .In other words it called a business legislation. This study shown that three policies of Birla tyre and their overall adherences as in Rotation 2017-18 Policy was 60%, Gold Coin 2017-18 was 58.57% and in case of Gold Voucher it was 65.71%, all these shown that the response towards the policy was good from UP West & Uttrakhand region dealers because policy holds the dealers .Good policy doesn’t mean that all the dealers follow him but major dealers follow it because there was no 100% follow-up in any policy. Policy defines the credit terms, turnover, Schemes and discounts etc. It give insight that company need good policy to their dealer because there no business without rule and regulation.
Product: - Product as per customer need give maximum utility to consumer in term of their Application and Capacity. Product as per their uses of load, price index and design attracts the consumers. In this Study product categorization as per their load categories which are Heavy, Standard and Moderates with their sales patterns in eight location of UP West & Uttrakhand region for analysing the customer preferences and choices in particular location.
Price: - Different parameter of pricing to calculates the selling cost of product. In this study different components of pricing of a particular product calculated to analysis each cost components which also relates to the Commercial and trade policies.
Policies
Three Types of policies are Commercial, Trade and other is Claim/Warranty Policy. In other term we say Quarterly and Monthly Sales policy with After Sale Policies. Company have different policies for OEM and Replacement market. Original equipment manufacturer need supply of tyres as per policies with special requirements of testing and benchmarking. In case of replacement market where medium to reach end user through dealer and distributer policies made as per competitor and current market scenario.
Commercial Policies:-It is the core part of policies which was static by nature from whole financial year but amended when necessary it consists core business rule for transaction between dealer and company like Payment Term, Business Module and Yearly Business commitments with specific annually discounts Structure.
Trade/Promotion Policies: -This consists of short term policies like Half Yearly, Quarterly and Monthly. This is short term momentum gain policies as per competitor move and current circumstances demand like Tractor Rear Schemes on farming season where farmer purchase tyres as that time sold their agriculture product in market and they have cash flow in hand.
Claim/Warranty or After Sales Policies: - This is after sale support policies to consumer as any defects relates to manufacturing faults comes and in many case non-manufacturing defects also consider through un-conditional warranty. This give assurance the consumer that product is free from any defects but in case any problem came we take care him under rule and regulation of Claim/Warranty or After Sales Policies.
Product
Variety of product is Breadth or number of categories typically carried by the outlet. Product Mix and Knowledge of all segments are needed to dealer as multi product counter are demand of consumers. Different Categories classified as per their application of are as follow.
Dealer or Channel partner has must knowledge of current trend of load carrying by vehicles by transporter because mainly if government not restricted in particular region than most of carrying overload as prescribed by transport and right application which mean carrying stone, general goods and iron etc , to provides the product which give maximum utility to consumers ,instead of that assortment is also important factor
Assortment – Depth or number of items within a category which we called SKU (Stock Keeping Unit). Assortment system could be a focal however complicated issue for retailers. Retail item arrangements have experienced radical changes in the previous decade from unparalleled expansive arrangements in the mid-1990s to the present accentuation on streamlined, proficient arrangements.
The assortment is customarily characterized as the quantity of SKUs offered inside a solitary item classification. In any case, purchaser recognitions regularly vary from target reality. In a fundamental paper, Broniarczyk, Hoyer, and McAlister (1998) announced that variety observations were impacted by three elements: (1) the quantity of one of a kind SKUs offered, (2) the heuristic of the aggregate space dedicated to the class, and (3) the accessibility of a consumer's most loved SKU.
Retailers and makers need to comprehend that customer arrangement recognitions are not just a component of the number of things offered in the product category. A key rule is that buyer impression of arrangement is likewise a element of the equivalence of the items within the assortment, the measure of the rack shown, and also the accessibility of their most favourite things.
Not exclusively do retailers and makers need to decide the span of their combinations; it is likewise basic to assess painstakingly how these varieties are composed. As recognizes various key standards:
(1) Side-by-side presentations encourage mark examinations, while isolate shows are better for expensive brands.
(2) Organizing by mark urges buyers to purchase by mark while sorting out by show invigorates the utilization of different properties, for example, cost.
(3) Evaluations have an inclination to be a lot of positive once brands are in most perceptibly unhealthy to-best request.
(4) Organized showcases are better for extensive groupings, yet for little arrangements, they settle on the absence of decision more clear.
(5) Asymmetrical varieties make it less demanding for customers to see the assortment in a variety.
(6) It is imperative to adjust groupings to consumers' inside information structures if customers know about the item class.
Large assortments have a few negative consequences for item decision.
(1) Large combinations increment decision trouble, increment negative effect, increment lament, and decline item buy.
(2) These negative results have been appeared to be more probable in buyers without very much characterized inclinations.
(3) These negative results area lot of probable for non-alignable than for alignable collections.
Above lines, if consumers don't have all around characterized inclinations they will probably make a buy from a little show offering alienable contrasts between alternatives. On the off chance that buyers have very much characterized item inclinations they lean toward a substantial collection, as it builds their capacity to locate their optimal. In any case, notwithstanding for these consumers, a huge grouping of non-alignable qualities may build assumptions about the perfect item to a level that is just unattainable prompting buy deferral.
Assortment perceptions and choices don't work in confinement; rather, the impact of arrangements on consumer data preparing and basic leadership may connect with other key showcasing blend factors, for example, value, store condition, locale, and aggressive contemplations.
Pricing
Pricing by tyre manufacturer is Dynamic pricing, Dynamic Pricing is when prices are adjusted continually to meet the characteristics and needs of the situations which is based on Competition pricing and Cost based pricing. Pricing calculated by the company whether it is trade and Commercial Policies with reference to Channel partner.
The implementation of customized pricing is based on the following steps:
(1) Understanding key drivers of Dealer pricing.
(2) Segmenting market by Dealer or channel network.
(3) Tailoring prices by market, category, customer, competitor, and brand.
The pricing procedure incorporates all parts of the assurance of the last transaction price. It begins with the technique, which involves targets identified with profit, volume, market share, positioning, general price level so forth. The revamping of pricing forms requires watchful and basic examination of current practices and comprehension of the current pricing structures, price differentiation, the competition, and the interior capabilities.
The pricing procedure tends to the assurance of prices what rules are connected, what data is utilized, and how value levels, value structures, rebates, or package costs are resolved. These standards are trailed by the organizational aspects of responsibilities, incentives, and information technology. To wrap things up, a ceaseless procedure at observing and controlling costs and edges must be set up. Therefore, clearly understanding all aspects of pricing is most crucial and important factors for channel partner.
Managerial Implication
Indian Automotive Tyres Industry is more concentrated where Promotion factor is constant in context of Indian Automotive Industry Market. The Price, Product and Policy (Commercial and Trade Policy) are key strategies for Indian Automotive Tyres Industry in the context of Channel Partner or Dealer. As no MRP (maximum retails prices) written or mention on product in case of Heavy Commercial Tyres as its not comes under any packaging which is currently not in practiced rather it is based on MOP (Marketing Operating Prices) therefore to understand the pricing structures as it is dynamics in natures. Heavy Commercial Tyres is technical product, which requires specific technical knowledge so outperform other competitor knowledge essential to Channel partner to take care all technical aspects Query by the Customers.eg load application. Policy gives insights to the Channel partner about the calculative approach towards objectives. As per the data, literature reviews and conclusions of the study some managerial implication which are which leads to Marketing Strategies to outperform the competitors.
Limitations and Future Scope of the Study
The limitation of the study is to find out the variables and there correlations with the Channel Partner or Dealer Network which gives course action for Marketing Strategies. Heavy Commercial Vehicles Tyres comes in different sizes here choose the most widely fitted segment 10.00-20 sizes and tyres are two tyres as based on constructions whether Radial or Nylon. Indian Automotive tyres market total potential Commercial Vehicle Segment nearly 10 lakh per month with major contribution of TBB Tyres so here choose TBB segments for study therefore this study limited to TBB segments. Fitment Survey Method which was used in this study was difficult to conduct at different locations of UP West and Uttrakhand which was managed with time frame and gathered data stored and retrieve with precisions.
The collection of information was confined to solely on 10 location of UP West and Uttrakahnd and since constraints was long-faced throughout data collection for large geographical area. The replication of the study at completely different regions of India would give higher generalize or robustness of the findings in the study.
The sample for the current study comprised of 10137 Tyre (TBB & TBR Tyres) and 70 no’s Channel Partner /Dealer this sample is just a really little proportion of the whole population of Dealer or Channel Partner and Tyres on roads within the country. Therefore, analysis studies with a lot of larger sample size would be needed to make sure applicable generalization of the findings of the study.
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