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Wheels India to venture into retail distribution

Company sees more demand for wheels in the replacement market especially from the trailer segment

TE Narasimhan  |  Chennai 

TVS group company, Limited is planning to venture into by setting up warehouses in the name of Wilgo. The company is planning to set up these centres to meet its customers on daily basis. Meanwhile, the company is looking at setting up a facility in Gujarat.

Srivats Ram, managing director, Limited said that besides catering to the daily needs, the distribution will also cater to short supply for replacement market and trailer manufacturers.

He added the company sees more demand for wheels in the replacement market especially from the trailer segment, agri tractors, CVs regionally, particularly in the northern region, where the demand for wheels is growing on daily basis.

“We want to meet the customer needs on a daily basis and the warehouses will enable the company to connect to the distribution points and we want to make it shelf-based," he said.

He added by December the company will have four Willgo warehouses across four regions and based on the success, the company will expand further”. Currently the replacement business accounts for one per cent of company's overall turnover and it expect to increase it to 3-5 per cent in the next three to four years, he added.

According to Ram, this is one of the initiatives the company has taken in the last one year, during the slowdown phase. The other two major initiatives taken up by the company includes rationalision of its manufacturing facilities, which would enable to meet the end users as company's OEM customers.

On the new initiatives, he said, the company embarked upon rationalising its production facilities in Chennai, Pune, Rampur, Bawal, and Pantnagar towards optimising logistics constraints while saving huge costs.
Meanwhile, the company  has reported a 22 per cent drop during the second quarter of the current fiscal at Rs 8.60 crore as compared to Rs 10.98 crore.

Company's turnover dropped marginally to Rs 496.95 crore from Rs 499.53 crore.

Ram said,"the company was impacted by the slowdown in the Indian economy that resulted in a 18 per cent drop in the medium and heavy commercial vehicle market, a five per cent drop in the agricultural tractor market, with a marginal growth in the car and utility vehicle market".

The exports of the economy did show growth of around 40 per cent in first half vis-a-vis the same period last year. However this was not adequate to offset the slowdown in the domestic market. On the cost front, the company faced steep increase in energy costs due to power tariff and availability of power.


First Published: Mon, November 05 2012. 18:16 IST