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Flat tyres of India ltd

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Abhishek Nagpal
Abhishek Nagpal

Here are some suggestions for Mr. Kailash to resolve the crisis: - Call a meeting with all dealers to understand their concerns and find a mutually agreeable solution. - Consider a rotational C&F agent system where dealers get a chance to be the agent. - Appoint Samy Auto as the primary agent but give other major dealers some additional responsibilities/incentives. - Clearly communicate the selection process and criteria to assure dealers it was unbiased. - Threaten to pull business from uncooperative dealers to motivate compromise.

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This case talks about one of the leading Tyre Manufacture Company in India; Flat Tyres of India Ltd. The case emphasizes on options in regards to company increasing its distribution network either through setting up sales offices in various locations or by appointing C & F agents. Having made a choice of appointing a C&F agent, the company lands up in a situation of loosing business with four efficient dealers in the Madurai region
Established in year 1962 o Head office Mumbai o Factory Mumbai Nasik o Sales office 30 offices & 3500 dealers o Rated 3rd among the tyre manufacturers 1. MRF 2. Modi 3. Flat tyres
Increase turnover from 400cr to 600cr (by year 1990) o Increasing the distribution network. o Appoint C&F agent: City Madurai
COSTLY AFFAIR INCREASE IN MANPOWER OPENING SALES OFFICE LOGISTICS HANDLING DISTRIBUTION EMPLOYMENT APPOINTMENT OF LESS COST C&F AGENT SHALL TAKE CARE OF REDUCED LOGISTICS OF COMPANY
FLAT TYRES OF INDIA LTD ruled out opening a company owned sales office: o It was too expensive o Non feasible to open offices at many chosen locations APPOINTMENT OF C&F AGENT IN MADURAI: o Would increase its sales from 16 lakhs to 20 lakhs per month o Availability of supplies in C&F stocking point , better supplies to the dealers o Goods shall remain the property of flat tyres of India. o Company sales officer shall have control over the C&F appointed MANAGER , CLERKS TYPISTS , DELIVERY BOYS & DRIVERS.
Direct agent of the company Provide with infrastructure Proper Co-ordination with Sales Team & Head Office Timely Informing about market updates, sales etc Adequate transport facility with local cartage and destination freight services Payment Follow up & accounts reconciliation WAREHOU ACCOUNTI COMPANY SE NG C& F SALES DEALERS LOGISTICS TEAM
Owned by Mr. Rama Swamy No.1 Tyre dealer in 1980 Market share of 40% Was C&F agent for JK industries Exclusive showroom for Dunlop India limited
Very good past relationship Loyalty Support during recession 25% contribution to total turnover of Madurai
Samay Manickam SKS Auto Ratna Auto Company/Dealer Auto & Co Centre Auto Tyres Balu Tyres KSS & Co Mobile Total Apollo Tyres 42.80% NIL NIL 7.41% 28.57% 14.28% 7.41% 100.00% Bombay Tyres 35.71% 17.85% NIL 10.71% NIL 35.71% NIL 100 Flat Tyres 50% 6.25% 3.13% 12.50% 18.75% 3.25% 3.13% 100.00% Dunlop India 51% 2.13% NIL 4.25% 8.51% 34.04% NIL 100.00% Goodyear 26.66% 6.66% 6.66% 13.33% 26.66% 13.33% 6.66% 100.00% JK Industries 88.88% 3.70% NIL NIL NIL 7.40% NIL 100.00% Modi Rubber 16.90% NIL 7.04% 5.63% 45.06% 5.63% 19.07% 100.00% MRF 20% 26.66% 6.66% 20% 13.33% 6.66% 6.66% 100.00% Vikrant 50% NIL NIL 12.50% NIL 25% 12.50% 100.00% Others 83.33% NIL NIL 16.66% NIL NIL NIL 100.00% Samay Manickam SKS Auto Ratna Auto Auto & Co Centre Auto Tyres Balu Tyres KSS & Co Mobile Over all Sales 39.02% 7.13% 3.66% 9.75% 20.73% 12.19% 7.13%
HORIZONTAL CONFLICT Opposition for appointing Samy Auto as C&F agent Conflict has reached the third stage o All the distributors strongly felt unhappy for Samy being chosen as C&F agent Important for company to resolve this crisis o Before it reaches Manifest stage
What is that Mr. Kailash could have done to resolve the crisis. Was there a third option available to Flat Tyres of India Ltd for increasing the distribution network? Why were the other dealers unhappy with Samy Auto Parts being chosen as C&F agent?
Flat tyres of India ltd

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Flat tyres of India ltd

  • 2. This case talks about one of the leading Tyre Manufacture Company in India; Flat Tyres of India Ltd. The case emphasizes on options in regards to company increasing its distribution network either through setting up sales offices in various locations or by appointing C & F agents. Having made a choice of appointing a C&F agent, the company lands up in a situation of loosing business with four efficient dealers in the Madurai region
  • 3. Established in year 1962 o Head office Mumbai o Factory Mumbai Nasik o Sales office 30 offices & 3500 dealers o Rated 3rd among the tyre manufacturers 1. MRF 2. Modi 3. Flat tyres
  • 4. Increase turnover from 400cr to 600cr (by year 1990) o Increasing the distribution network. o Appoint C&F agent: City Madurai
  • 5. COSTLY AFFAIR INCREASE IN MANPOWER OPENING SALES OFFICE LOGISTICS HANDLING DISTRIBUTION EMPLOYMENT APPOINTMENT OF LESS COST C&F AGENT SHALL TAKE CARE OF REDUCED LOGISTICS OF COMPANY
  • 6. FLAT TYRES OF INDIA LTD ruled out opening a company owned sales office: o It was too expensive o Non feasible to open offices at many chosen locations APPOINTMENT OF C&F AGENT IN MADURAI: o Would increase its sales from 16 lakhs to 20 lakhs per month o Availability of supplies in C&F stocking point , better supplies to the dealers o Goods shall remain the property of flat tyres of India. o Company sales officer shall have control over the C&F appointed MANAGER , CLERKS TYPISTS , DELIVERY BOYS & DRIVERS.
  • 7. Direct agent of the company Provide with infrastructure Proper Co-ordination with Sales Team & Head Office Timely Informing about market updates, sales etc Adequate transport facility with local cartage and destination freight services Payment Follow up & accounts reconciliation WAREHOU ACCOUNTI COMPANY SE NG C& F SALES DEALERS LOGISTICS TEAM
  • 8. Owned by Mr. Rama Swamy No.1 Tyre dealer in 1980 Market share of 40% Was C&F agent for JK industries Exclusive showroom for Dunlop India limited
  • 9. Very good past relationship Loyalty Support during recession 25% contribution to total turnover of Madurai
  • 10. Samay Manickam SKS Auto Ratna Auto Company/Dealer Auto & Co Centre Auto Tyres Balu Tyres KSS & Co Mobile Total Apollo Tyres 42.80% NIL NIL 7.41% 28.57% 14.28% 7.41% 100.00% Bombay Tyres 35.71% 17.85% NIL 10.71% NIL 35.71% NIL 100 Flat Tyres 50% 6.25% 3.13% 12.50% 18.75% 3.25% 3.13% 100.00% Dunlop India 51% 2.13% NIL 4.25% 8.51% 34.04% NIL 100.00% Goodyear 26.66% 6.66% 6.66% 13.33% 26.66% 13.33% 6.66% 100.00% JK Industries 88.88% 3.70% NIL NIL NIL 7.40% NIL 100.00% Modi Rubber 16.90% NIL 7.04% 5.63% 45.06% 5.63% 19.07% 100.00% MRF 20% 26.66% 6.66% 20% 13.33% 6.66% 6.66% 100.00% Vikrant 50% NIL NIL 12.50% NIL 25% 12.50% 100.00% Others 83.33% NIL NIL 16.66% NIL NIL NIL 100.00% Samay Manickam SKS Auto Ratna Auto Auto & Co Centre Auto Tyres Balu Tyres KSS & Co Mobile Over all Sales 39.02% 7.13% 3.66% 9.75% 20.73% 12.19% 7.13%
  • 11. HORIZONTAL CONFLICT Opposition for appointing Samy Auto as C&F agent Conflict has reached the third stage o All the distributors strongly felt unhappy for Samy being chosen as C&F agent Important for company to resolve this crisis o Before it reaches Manifest stage
  • 12. What is that Mr. Kailash could have done to resolve the crisis. Was there a third option available to Flat Tyres of India Ltd for increasing the distribution network? Why were the other dealers unhappy with Samy Auto Parts being chosen as C&F agent?