Development of supplier to ensure smooth and reliable supply of cylinder liners

Abstract

Mahindra and Mahindra are market leaders in Indian tractor market for last sixteen years. M and M have set a target of becoming world's number one tractor manufacturer by 2005.M and M offers wide range of tractors to cater to needs of each market segment from small horsepower to high horse power tractors. The company is facing increasing competition from the domestic players and it is expected to grow further and turn fierce with entry of the global players in Indian tractor industry in the near future. In this changed scenario of increasing competition, customer is not prepared to wait as he has variety of choice of tractors available to him. Loss of customer is loss of market share to M and M. Hence M and M is working on strategy of timely availability of tractors to the customer. M and M's dependence on the bought out components is major, constituting 62% of manufacturing cost of a tractor. Therefore the success of this strategy greatly depends on the capability of the suppliers to meet M and M's quantity and delivery requirements. If the component is procured from a single source, his capability has a greater impact on implementing this strategy. Cylinder liner is one such component which M and M procures from single source, M/s Western Auto Spares, Ahemdabad. The study involves critically examining the existing procurement process, asses capability of M/s Western Auto Spares for meeting M and M's quantity and delivery requirements. It attempts to identify the gaps in the entire procurement process and capability of M/s Western Auto Spares. The study further suggests the improvements to bridge these gaps and evolves a system for M/s Western Auto Spares to meet M and M's requirement. At the end, the report concludes with limitations of the study, with probable solutions to overcome those.