Presentation on Industrial Training at Akal Springs Ltd.

Presented by:Dinesh Grover

MBA – 2(B)

Introduction to Automobile Industry in India

• Sixth largest in the world• Over 2.3 million units production• World’s leading car and two wheeler maker

present in India• Major players - Bajaj Auto, Hindustan Motors,

Hero Honda, Mahindra, Maruti Udyog Ltd, Daewoo Motors etc.

Auto Components Industry• One of India’s sunrise industry.• As per ACMA the turnover of the auto

component industry was estimated at over US$ 19.1 billion.

• Potential compounded annual growth rate estimated at 11% for period 2008-2015.

• Exports from auto components industry for 2008-09 is US$ 3.8 billion.

• the original equipment manufacturer (OEM) segment accounting for 80 per cent of exports in 2008.

EEPC

• Established in 1955-56• Council having membership of nearly 12,000

from amongst large Corporate Houses, Small & Medium Scale Units (SME), Trading Houses, etc.

• EEPC – right from its inception has been insisting the exporting community on the quality parameter

Activities and Services of EEPC

• Publicity & Promoting the ‘Made in India’ brand• Organizing INDEE Exhibition

– Firstly took place in Singapore in 1977– Indonesia in 2009– Regularly organized since 1999

• Participates at leading Exhibitions and Trade Fairs– Spring Fair in Birmingham, National Hardware Fair in

Chicago and similar other trade fairs all over the globe

• Services to the overseas buyers

INTRODUCTION TO AKAL SPRINGS LTD.

• Established in 1979 under the guidance of Late Sh. Manjit Singh Riat now being controlled by Ms. Sandeep Riat

• The company today is an industry leader, manufacturing high quality laminated leaf spring

• Over the years the company has achieved impeccable reputation in terms of reliability, quality & delivery.

FUTURE PLANS OF AKAL

With a high capability for absorption of manufacturing technology, strong engineering infrastructure and a dedicated and devoted workforce, the company finds itself at the threshold of major growth opportunity.

Hierarchical Structure of Akal

PEOPLE AT AKAL SPRINGS

“People Our Greatest assets at Akal Spring”

Akal employs professionals in every department of manufacturing as well as administration. The team work and professional approach has provided shape and growth to the plans of the company.

Main Product

Leef Spring

Leef Spring

Exports in Akal Springs Ltd.

• Akal Springs Ltd. is having a good image in international market. Akal is engaged in exporting Leaf Springs & Spring assemblies to

• Mercedes • Toyota • Volvo• Mitsubishi • Fiat etc.

Akal also undertake manufacturing as per customer's specification/ Drawing.

Quality at Akal Springs Ltd

- Producing Quality Goods .- Adhering To Delivery Schedules .- Continuously Upgrading Our Products And Processes Through Up Gradation In Technology And Active Participation Of Employees At All Levels.

Quality

View of Material Testing Laboratory

Assembly Painting Line

Infrastructure at Akal Springs Ltd

Some more facts

• Ms. Sandeep Riat(MD) has been awarded Young & Innovative Entrepreneur of the year Award by Ludhiana Management Association.

• Akal is an ISO/TS 16949:2002 certified Co.• Akal Spring Ltd. is now an OEM to Prestigious

Mahindra& Mahindra.• With Changing Time Akal Springs Ltd. has

changed its Trade mark to ASL from GS.

Research Methodology

Title

Problems Faced by Auto–Parts Exporters in Ludhiana

Objectives

• To study the problems faced by the Auto Parts firms while execution of order.

• To study the financial problems faced by the selected auto parts firms.

Research Methodology

It is a way to systematically solve the research problem; it may be understood as a science of study how research is done scientifically.

Need For Study

As it is known that there are a large number of problems that are being faced by the exporters in executing an export order and in the local market. So an idea was generated to do a research on the topic: Problems Faced by Exporters of Auto parts in Ludhiana.

Research Methodology

Research Design: This study will be descriptive. This study is mainly concerned about an existing problem and its basic nature cause and effect. It is concerned with discovering and testing certain variables with respect to their services.

Sample Plan: Sampling is an effective step in the collection of primary data and has a great influence on the quality of results.

Research Methodology

Population: All MSME export units related to Auto Parts Units in Ludhiana.

Sample Unit: Any MSME Auto part export unit or owners in Ludhiana.

Sample Size: Although there are large numbers of Auto Parts MSME export units in Ludhiana. But to conduct a research sample 20 respondents is to be taken.

Research Methodology

Sample Technique: Convenience Sampling. Respondents were chosen on the convenience basis.

Data Collection: Data collected from both primary and secondary sources.– Primary Sources: Data regarding the problems being

faced by MSME was collected through questionnaire (both open ended and close ended questions were asked)

– Secondary Sources: Indian Journal of Marketing, Images Retail, Previous Researches, websites

Research Methodology

Limitations – Only 20 respondents are taken as sample size.– Time was constraint.– Biased view and behavior of respondents.

Analysis & Interpretation of Primary Data

11

54

5

15

65

6

02

4

6

810

12

14

16

Responses

USA Russia Sri Lanka South

Africa

UK Australia Canada Other

Countries

Graph - 4.1 Countries where auto-parts are exported (N=20)

Graph 4.2 Proportion of exports in total sales (N=20)

3

1

8

5

3

0

2

4

6

8

10

Below 20 20-40 40-60 60-80 80-100

Proportion of exports in sales(in%)

No

of

resp

on

ses

Table 4.1 Way of ExportingN = 20

Direct Export Indirect Export Both

No of respondents 14 3 3

Table 4.2 Way of Sales Promotion in case of direct export

N = 17

No. of Responses

Advertisements 3

Direct Marketing 14

Surveys 3

Others 4

Table 4.3 Way of selling through indirect exports

N = 6No. of responses

Merchant Export 4

Buying Agent 1

Commission Agent 2

Any other 0

Graph 4.3 Best way of exportingN=20

16

3

10

2

4

6

8

10

12

14

16

No

. of re

sp

on

de

nts

Direct Eport Indirect Export Both

Ways to Export

Graph 4.4 Exporters get export order through

4

15

13

3

11

2

0

2

4

6

8

10

12

14

16

Agent Trader Participation inTrade Fairs

Visiting Abroad Advertisement PersonalContacts

Any Other

Ways of getting export order

No

of

resp

on

ses

Table 4.4 Factors Considered by the Buyers

N = 20Factors Mean Ranks

Price 3.3

Quality 4.2

Delivery Reliability 2.5

Packaging 2.65

Reputation of the firm 2.35

Table 4.4 Factors Considered by the Buyers

N = 20Factors Mean Ranks

Price 3.3

Quality 4.2

Delivery Reliability 2.5

Packaging 2.65

Reputation of the firm 2.35

Table 4.5 Problems faced by exporters in execution of export

order N = 20Problems No of responses

Inadequate infrastructure facility 4

Unstable govt. policies 10

Protectionists barriers 2

Corruption 8

Inadequate incentives 3

Fluctuating foreign exchange 9

Technical limitations 5

Rejection of consignment 4

Lack of knowledge 7

Letter of credit 2

Cargo / Shipping 3

Monopoly of big exporters 4

Any other 1

Table 4.6 Sources for arrangement of finance for exports

N = 20Sources No. of ResponsesBanks 16

Private institutions 2

Govt. bodies 0

Self financing 13

Any other 0

Table 4.7 Mode of payment to be received from customer

N = 20

Modes of payment No. of responses

Against L/C 19

Cash Advance 6

Any Other 0

Table 4.8 Modes of transport used by exporters

N = 20Modes of Transport No. of responses

By Air 11

By Sea 18

By Road 7

By Rail 7

Table 4.9 Major problems occurring while arranging the finance

N = 20Problems Mean ranks

High interest rates 3.5

Non availability of finance on short notice

3.6

Inadequate incentive by govt. 3.2

Changing govt. policies 3.6

Any other 1.1

Table 4.10 Major competitors globallyN = 20

Countries No. of responses

Pakistan 0

China 14

Japan 11

UK 1

USA 3

Others 1

Table 4.11 Major problems faced in shipping/air lifting the goods

N = 20

Problems Mean ranks

Harassment by custom authority 3.55

Time consuming procedure 3.65

Non-availability of shipping / air 3.1

High transportation cost 3.4

Others 1.3

Table 4.12 Satisfaction level for the following

N=20H.satisfied

(2)Satisfied

(1)Neutral

(0)Dissatisfied

(-1)H.dissatisfied (-

2)Total Mean

score

Tax benefits 4*(2) 8*(1) 7*0 1*(-1) 0*(-2) 15 0.75

Warehousing 2*(2) 11*(1) 7*0 0*(-1) 0*(-2) 15 0.75

Help fromAutomobile

Association

5*(2) 5*(1) 8*0 1*(-1) 1*(-2) 12

0.60

Facilities by Shipping line

4*(2) 7*(1) 8*0 1*(-1) 0*(-2) 14

0.70

Facilities by General Insurance Co.

3*(2) 9*(1) 8*0 0*(-1) 0*(-2) 15

0.75

Government Policies

4*(2) 2*(1) 13*0 0*(-1) 1*(-2) 80.40

Findings and Suggestions

Findings1. The unstable government policies, corruption &

fluctuating are some of the main problems that are being faced by the exporters.

2. That most of the exporters are highly Dissatisfied with the government policies regarding exports.

3. The exporters are facing the financial problem like high rate of interest, non-availability of finance on short notice and inadequate incentives by govt.

4. There are low level facilities by shipping lines.5. Tax benefits provided by Govt. to exporters are also not

satisfactory.6. Major competitors are China and Japan in automobile .

Suggestions

• Government should prepare best policies for the exporters for this they can take help of the exporters too.

• Warehousing Facilities should be made to the exporters.

• Extra Tax benefits should be given to the exporters.• Govt. and RBI should take care of interest rates.• Facility of finance on short notice should be made

available by banks.

Bibliography• Mahajan Harleen & Sharma Sandhir, ‘ Challenges for the

Indian Entrepreneurs with Global Perspective’, International Conference on Fostering Entrepreneurship in Global context’, March 2009, pg 5

• Makkar Urvanshi Kumar Satish & Gupta Meenakshi, ‘ Marketing Support System will it be able to withstand the impact of Globalization?’, Indian Journal Of Marketing, vol-xxxiv No.2, February 2004, pg 20-23

• Mallya MP, ‘ Empowering Indian SMEs for Global Competitiveness A Bank of Baroda approach’, conomic Times, March 24, 2009, pg13

• Moutary Chad, ‘ Looking Ahead: Opportunities & Challenges for entrepreneurship and small business owners, October 2008

Bibliography• Murugan S., Ghanadhar Dr & Pillai Dr. W. Thallai ‘Marketing

Support System: will it be able to withstand the impact of globalization?”, Indian Journal of Marketing vol-xxxiv, no.4 may 2004, pg 21-27.

• Murugan S., Ghanadhar Dr. M. Edwin & Pillai Dr. W. Thallai ‘ Small Scale Industrial maladies- do they be caused by marketing sickness?’, Indian Journal of Marketing vol-xxxiv, no.5 may 2004, pg 15-18.

• Sastry LV, A Stitch in time saves nine, Economic Times, March 24,2009, pg 13

• Suresh Vidya & Shashidhar P., ‘ Competitiveness of Small Scale Industries of India’, 2007, http://dspari.iimk.ac.in/bitstream/2259/501/1/439.453.pdf

Bibliography• Singh B.K. & Singh V.S. ‘ Indian Entrepreneurs in

global setting identifying threats’, Gitam Journal of Management, vol-6, no.2, April-June 2008, pg 106-129.

• http://msme.gov.in/msme_aboutus.htm dt: 15.07.10 about MSME

• http://www.siamindia.com/scripts/industrystatistics.aspx dt.15.07.10 about Indian Auto Industry

• http://www.infodriveindia.com/ dt 20.07.10• http://www.indiatradecenter.in/itc/

view_section.php?lang=1&id=0,22 dt 20.07.10

Bibliography

• http://www.eepcindia.org/brief-profile.asp dt 29.07.10 About EEPC (Engineering Export Promotion Council)

• http://www.eepcindia.org/organizing-exhibition.asp#organizingexhibition dt 29.07.10 data related to the exhibitions being organized by EEPC.

Thank You!!!!!