INTRODUCTION One of the greatest needs of managers of business is to understand and develop marketing programs for their products and services. Business success is based on the ability to build a growing body of satisfies customers. Modern marketing programs are built around the “marketing concept” which directs managers to focus their efforts on identifying and satisfying customer needs – at a profit. In present situations of intense competition, and extreme dynamism, companies all over the world are turning their focuses on to their customers. “Sellers market” concept has been replaced and “customer is god “concept is of major prime. Earlier goods and services were in short supply and this helped the seller to call the shots. But situations changed with the advent of globalization. Today, marketers are directing the total transformation in the way the customers being perceived. Today, marketers are directing their efforts in retaining the existing customers and maintaining the customers’ base rather than acquiring new customers. The focus of marketers is on integrating three elements –people, service and marketing. Customers can “make or break” a company in today’s world because of the inherent value of his/her command in the market. So the responsibility of every organization is to ensure uniform satisfaction levels among its customers. One single dissatisfied 1
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
INTRODUCTION
One of the greatest needs of managers of business is to understand and develop marketing
programs for their products and services. Business success is based on the ability to build a
growing body of satisfies customers. Modern marketing programs are built around the
“marketing concept” which directs managers to focus their efforts on identifying and satisfying
customer needs – at a profit.
In present situations of intense competition, and extreme dynamism, companies all over
the world are turning their focuses on to their customers. “Sellers market” concept has been
replaced and “customer is god “concept is of major prime. Earlier goods and services were in
short supply and this helped the seller to call the shots. But situations changed with the advent of
globalization. Today, marketers are directing the total transformation in the way the customers
being perceived. Today, marketers are directing their efforts in retaining the existing customers
and maintaining the customers’ base rather than acquiring new customers. The focus of
marketers is on integrating three elements –people, service and marketing.
Customers can “make or break” a company in today’s world because of the inherent
value of his/her command in the market. So the responsibility of every organization is to ensure
uniform satisfaction levels among its customers. One single dissatisfied customer will pass on
the message to at least nine others sparking off a chain reaction and a spell doom for the
company. Research has shown that acquiring new customers can cost 5 times more than the cost
involved in satisfying and retaining existing customer.
Concept of taking customers for granted is no longer applicable. The idea of product
safety, quality, service and product appeal has brought over many changes. The “caveat- emptor”
attitude of manufactures has been replaced with “caveat-venditor” attitude. The Government
policies on liberalization globalization and privatization along with a series of defense
mechanisms for customers like the customers’ protection laws, regulation of the government, the
powerful hands of the organization, customers’ courts, switching to substitute or competitors that
offer at competitive prices, etc is the major reason for the changes we perceive in the market.
1
INDIAN TYRE INDUSTRY
In the present world, Tyres play an important role in the field of transportation. Tyres are
the workhorses for the mobile society in which we are currently living in. A great deal of public
attention has been provided to this very important commodity. Tyre manufacturers will be
working to bring about much greater uniformity in all aspects if performance.
The Indian tyre industry comprises of 40 companies in the organized and unorganized
sectors and is divided into two tiers:
Tier-I players[top 5 tyre companies] account for over 80% of industry turnover
containing a well diversified product mix and presence in all three major segments, i.e.
replacement market , original equipment manufacturers and exports.
Tier-II companies are small in size, concentrating chiefly on production of small tyres,
tubes and flaps and the replacement market. The industry has negligible market share in
commercial vehicles tyre category and is around 20% in the two wheeler tyre category.
The Rs.20,000 crore Indian Tyre Industry is highly raw material intensive and
predominantly a Cross Ply or Bias tyre manufacturing industry. It produces all categories of tyres
except Snow tyre and Aero Tyre for which there is no demand domestically. While the tyre
industry is mainly dominated by the organized sector, the unorganized sector holds sway in
bicycle tyres. The major players in the organized tyre segment consist of MRF, Apollo Tyres,
CEAT and JK Industries, which account for 63 per cent of the organized tyre market. The other
key players include Modi Rubber, Kesoram Industries and Goodyear India, with 11 per cent, 7
per cent and 6 per cent share respectively. Dunlop, Falcon, Tyre Corporation of India Limited
(TCIL), TVS-Srichakra, Metro Tyres and Balkrishna Tyres are some of the other players in the
industry. MRF, the largest tyre manufacturer in the country, has strong brand equity. While it
rules supreme in the industry, other players have created niche markets of their own.
Truck and bus tyres account for over 65% of tyre industry turnover in India. Hence
demand for the above two is the true indicators of performance of Indian economy in general and
also the tyre industry in India. Indian Tyre Industry provides direct and indirect employment to
nearly 1 million or more people taking in to account the dealers, retreaders, growers of natural
2
rubber, employment in raw material sector etc. The sector is raw-material intensive, with raw
material accounting for 70% of the total costs of production. Total production figures in
tonnage: 11.35 lakh MT & total production of tyres in all categories: 811 lakh (2007-08).
Current level of radialization includes 95% for all passenger car tyres, 12% for light commercial
vehicles and 3% for heavy vehicles (truck and bus. Restrictions were placed on import of used
/retreaded tyres since April 2006. Import of new tyres & tubes is freely allowed, except for radial
tyres in the truck/bus segment which has been placed in the restricted list since November 2008.
Total value of tyre exports from India is approximately Rs 3000 crore (2007-08) .The major
factors affecting the demand for tyres include the level of industrial activity, availability and cost
of credit, transportation volumes and network of roads, execution of vehicle loading rules,
radialization, retreading and exports.
Evolutionary Phases of Tyre manufacturing in India
Phase Period Characteristics Policy regime
Phase I 1920-35
No domestic production. Demand
met through imports. Key players
included Dunlop , Firestone and
Goodyear
Liberal imports
Phase II
1936-60
Domestic production begins by
erstwhile trading companies:
Dunlop, Firestone, Goodyear and
India Tyre & Rubber Company
Imposition of tariff & non-tariff
barriers on imports
Phase III 1961-74
Indian companies-MRF, Premier &
Incheck- enter manufacturing sector
with foreign technology; licensing of
additional production capacity
Regulation on capacity
expansion and repatriation of
profits of foreign companies;
enforcement of export obligation
on MNC; protection from
external competition
Phase IV 1975-91
Entry of large Indian business
houses like Singhania & Modi &
technical collaborations with MNCs,
De-licensing of production,
placing of imports under OGL
3
introduction of radial tyres, vertical
integration and exponential growth
in tyre production & exports
with tariff & non-tariff barriers
Phase V 1992 onwards
External trade liberalization &
reduction in import duty; re-entry of
MNCs either independently or in
collaboration with Indian capital
Progressive reduction in import
duty; liberalized imports
COMPANY PROFILE – APOLLO TYRES
Apollo Tyres straddles the Indian tyre industry much like the Greek Sun God Apollo's
four horse-drawn chariot races across the vast expanse of the sky, symbolizing the creation of
light, hence knowledge and truth. And like the Greek charioteer, Apollo Tyres has stood the test
of time on the four pillars of vision, integrity, quality and sheer determination.
The history of Apollo Tyres dates back to 1974 when it was incorporated as a company in
Cochin, Kerala through the purchase of a license from the Ruby Rubber Works. Cochin by Mr.
Mathew T. Marattukalam, Jacob Thomas and his associates. In 1976, the company was taken
over by Dr. Raunaq Singh. Apollo's first manufacturing facility (often referred to as the 'mother
plant') is in Perambra, Cochin where production commenced in 1977 with an installed capacity
of 420,000 each of tyres and tubes.
The first 20 years of the company's existence were not easy. Those were times when
licenses and quotas ruled the world of manufacturing in a market dominated by multinational
companies with access to technology and machinery and deep pockets.
Therefore, soon after its inception, due to the huge investments required, Apollo wiped
out its net worth and became a BIFR (Board of Industrial and Financial Construction) company
during the Emergency years. However, Apollo Tyres was returned to its owners during the
Janata Government.
Apollo then used to make the entire gamut of tyres required for scooters, bicycles, trucks
and cars. However, the then core team, led by Onkar Singh Kanwar, realized that to make an
impact in the market and become financially viable it had to become a dominant player in the
commercial vehicles segment. At the time, Modi Tyres had an overwhelming market share and
4
reputation. Extensive on-ground research by the team allowed it to understand the areas in which
Apollo could make an impact.
The philosophy then was 'one product fits all', where regardless of the kind of usage, the
tyres truckers fitted on their vehicles were the same. Team Apollo decided to known as the
'overload' segment and produce tyres which could withstand the extra load the vehicles were
made to carry, while providing drivers with the crucial safety net. It was a tyre called the
Hercules which was the first of its kind. Later, products like Amar, Loadstar and XT-7, XT-9 and
XT-9 Gold were introduced, products still enjoy consumer validation. In fact, XT-9 is the only
tyre in India to have sold more than one crore units, providing the superiority of the product.
In later years, there have been many such first in Apollo's cap. Apart from enjoying the
distinction of being the first tyre company to segment the market on the basis of load and
mileage requirements, it has been the first to introduce packaging for car tyres and tubes and also
the very first Indian company to introduce farm radial tyres. Among other innovative moves,
Apollo is the first tyre company to run customer loyalty and awareness programmes to enable
them to derive optimal benefits from their Apollo farm tyres, and also the first to launch
exclusive rural retail stores 'Apollo Tyre World' for truck tyres. Apollo tyres Ltd. has another
first to its credit being the first Tyre Manufacturing Company Worldwide to be certified for
B7799 given for information security of IT systems.
Another landmark has been the successful implementation of SAP across the
organization for better results and productivity.
1975 Inception
1975 Registered as a company
1977 First plant commissioned in Perambra (Cochin, Kerala)
1991 Second plant commissioned in Limda (Baroda, Gujarat )
1995 Acquired Premier Tyres in Kalamassery (Cochin, Kerala)
1996 Exclusive tubes plant commissioned in Ranjangaon (Pune, Maharashtra)
2000 Exclusive radial capacity established in Limda
2000 Established Apollo Tyres Health Care Clinic for HIV-AIDS awareness and
prevention in Sanjay Gandhi Transport Nagar, Delhi
2003 Expansion of passenger car radial capacity to 6,600 tyres/day
5
2004 Production of India 's first H-speed rated tubeless passenger car radial tyres
2004 Support in setting up India 's first Emergency Medical Service in Baroda ,
Gujarat
2005 Apollo Tyres Health Care Clinics in Udaipur in Rajasthan and Kanpur in
Uttar Pradesh
2006 Expansion of passenger car radial capacity to 10,000 tyres/day
2006 Expansion of passenger car range to include 4x4 and all-terrain tyres
2006 Acquired Dunlop Tyres International in South Africa and Zimbabwe
2006 Opening of Apollo Tyres Health Care Clinic in Ukkadam, Tamil Nadu
2006 Launch of DuraTread, treading material and solutions
2006 Launch of India's first range of ultra-high performance V and W-speed rated
tyres
2007 Launch of Regal truck and bus radial tyres
2007 Launch of DuraTyre, retreaded tyres from Apollo
2007 Launch of the Apollo Tennis Initiative and Mission 2018
2007 Apollo diversifies into transport and logistics
2008 Awarded the Gold Certificate for its manufacturing units at India
Manufacturing excellence awards
2008, the company opened their first full-services branded commercial vehicle
tyre outlet called Apollo Trust in Salem, Tamilnadu
2008 Established a plant in Hungary
2008 First ever ultra size Off-The-Road [OTR] tyre from Limda Plant
2009 Acquisition of 100% shareholding control of Vredestein Banden B.V.,
Netherlands
2009 commisioning of Chennai green field manufacturing facility
2010 Launch of habitat apollo
VISION
“To be a significant player in the global tyre industry and a brand of choice, providing
customer delight and continuously enhancing stakeholder value.”
6
VALUES
Care for customer
Respect for associates
Excellence through teamwork
Always learning
Trust mutually
Ethical practices
“PASSION IN MOTION “ is apollo’s journey towards excellence.It revolves around 3 key
pillars of people quality and technology using th rigour of six sigma methodology across all
functions
GROWTH PROSPECTIVE IN INDIA
7
CRITICAL STRATEGIES ADOPTED BY APOLLO TYRES
Various strategies adopted by Apollo tyres include:
New Product Development Strategy
New Product development have eight steps, Idea Generation, Idea Screening ,Concept
Development and Testing, Business Analysis , Beta Testing and Market Testing , Technical
Implementation, Commercialization & New Product Pricing. Apollo is the first Indian Tyre
Company to produce H, V and W-speed rated tubeless tyres and also to introduce radial tyres
for the farm category.
Strategic Brand Management
"Strategic brand management involves the design and implementation of marketing
programs and activities to build, measure, and manage brand equity." These concepts and
techniques are to improve the long-term profitability of your brand strategies.
The four steps involved are,
Identifying and establishing brand positioning and values.
Planning and implementing brand marketing programs.
Measuring and interpreting brand performance.
Growing and sustaining brand equity.
Apollo is the first company to launched new scheme of solving the claim within 2 days.
This strategy provided Apollo a great advantage over its competitors.
GLOBAL MANUFACTURING LOCATIONS
Bulawayo, Zimbabwe
Chennai, India
Durban, South Africa
Enschede, Netherlands
Harare, Zimbabwe
8
Kalamassery, India
Kundli, India
Ladysmith, South Africa
Limda, India
Perambra, India
RAW MATERIAL PROCUREMENT
Raw materials are procured by indigenous procurement and imports. Indigenous
procurement of synthetic rubber from Gujarat, Carbon from Ambalamukal, Andhra Pradesh,
Beads from Tata Steel, etc. is done. Imports of raw materials are nylon from Taiwan, Bangkok,
China, synthetic rubber from Hongkong, Korea, Brazil, rubber and chemicals from Germany,
etc. Chemicals like retarders, accelerators, sulphur, zinc oxide. Payments of raw material are
made using letter of credit
APOLLO SALES
Apollo Tyres make their sales through their dealers. In Apollo 75% of the tyres are sold
out by way of depo sales, 20% through Orginal Equipment Manufacturers and 8 – 10% by way
of exports.
Original Equipment Manufacturers can be classified based on different types of
vehicle
1.Heavy and Light Commercial Vehicles
Tata Motors, Ashok Leyland, Eicher, Tatra Udyog, SML Isuzu, Force Motors,
Swaraj Mazda, Mahindra Navistar, Asia Motors, Kamaz-Vectra, MAN Force Trucks,