India is the fastest-growing economy in the world. It is rising income, thru a boost in infrastructure, expanding middle-class population, that has helped in the growth of the Indian economy.
The Indian Auto-Component Industry is currently 2.6% of the GDP, and providing direct employment to 13 mln people is likely to further grow to 5-7% of the Indian GDP by the year 2026. this industry will become 200 bln US$ out of which 30 bln will be exported the world over.
The Indian Auto-component industry is likely to be the third largest in the world within the next 5 years as it has the following Indian advantages –
- Robust Demand
- Export Opportunities
- Govt Policy Support
- Competitive Advantage
The auto-Component Aftermarket segment assumes great importance because it is considered recession free due to the following
- Recession free as potential will keep growing with an increase in vehicle population.
- Steady increasing personal mobility.
- Healthy Freight movements
- Manifold growth in the resale segment due to cost escalation of new vehicles.
With the above background in view, it becomes important to deploy the strategy to achieve short-term and long-term goals. strategy inputs are required to be put into action for effective execution.
It’s important to first define the Strategy- In simple words, it is a plan in order to achieve something.
Professionally Strategy can be explained as a path to achieve a defined vision (corporate goals) by setting short terms and long term goals with time targets or milestones. This article makes sincere efforts to identify the pillars on which strategy can be evolved for business success and growth.
Pillars are based on the important learnings during the last 2-3 years pandemic period including pre and post-Covid phases:-
> VUCA is an essential part of any economy.
> Cash is king.
> Change is the only constant and is always better.
> There are always sweat spots even in diverse situations and need to be explored.
> Always maintain focus on product development and upskilling of employees.
Following are the identified important pillars on the basis of which successful strategies can be finalised for business growth. It can also be used as a ready reference for preparing the relevant strategies.
- Define the business segment clearly, for example, it’s important to understand whether the product is a critical component or a commodity product. The aim is to enter the aftermarket or OE market or export market. alternately all three segments. This will help in finalising the focused market, channel, customers, and influencers.
- Conduct the SWOT analysis. This will help in targeting competitors’ weaknesses, highlighting own strengths, exploring future opportunities, and preparing to fight the threats.
- Set Short-term and Long Term goals This is primarily setting the milestones with time targets to ensure steady growth, achieve goals with effective micro and macro management.
- Finalise the alliance and partnership strategic channels are prepared on the basis of ABC analysis to reach every potential customer to maintain an edge on existing or future competition.
- Plan and ensure customer delight for both B2B customers in the form of ROI and B2C in the form of value for money.
- Target to improve the frequency of purchase: Plan and strategising improvement in repeat customers for building value per customer.
- Focus on increasing market share: Business growth is ensured with an increase of market share even during the stagnant market situation therefore, plan should envisage increasing market share by creating an edge over the competition This also improves visibility, and acceptability in addition to expanding the volunteer influencers base as most of the people wish to be on the side of leaders.
- Finalise the measurable Targets: There is a need to work on Smart (specific, measurable, achievable, relevant, time-bound) targets which help in setting the milestones for effective monitoring.
- Finalise plans for geographic expansion: This helps in an all out wider spread/expansion base to enable reach the remotest last customer to become the most preferred available brand.
- Identify and expand the Influencer base: In the current market situation people rely on good references while making purchases, which is more prevalent within the auto component industry. The influencers can be retail dealers, mechanics, workshop owners, purchase officials in govt depts/bulk buyers, etc. More influencers are recommended for sales growth. References are considered reliable for business growth.
- Create a clear marketing message/content: The clarity of marketing content and/or message reflecting transparency and honesty clears the doubt in the mind of customers/clients and helps to make purchase decisions in favour of such brands.
- Change the product selling to a service/solution providers concept: Once any product brand becomes the preferred choice it transforms into a solution provider. This helps in achieving sales beyond targets because it becomes the need and not the choice eg if a particular brand of piston rings is considered best to control the compression loss of an engine it becomes the solution provider and then sales are beyond the target lines.
- Introduce new variants of an existing product in a situation when the existing product seems to be reaching the peak sales level it starts attracting the attention of competitors (both organised and unorganised) it is the right time to introduce new modified variants with unique differential and USPs to maintain an edge over the competition and to stay ahead.
- Write articles/initiate sponsored news in business magazines: Visibility and acceptability go hand in hand. Media coverage both in print and digital mediums attracts professionally inclined forward-looking clients and this adds to brand power and respect for both company and brand. Articles can be on products, technology, new features, and even on the promoter’s history.
- Create a powerful brand: Brands and logos are like any other valuable assets for corporations. There have been instances of popular and famous brands being sold at enormous prices. It keeps growing with time. brand power and value are enhanced by quality, service, technology, and promoters.
Above is the list of important pillars on which strategies can be built for the success of business growth, especially for those companies having a clear vision and long-term goals.
This article is an effort to provide a ready reference for the basis on which relevant strategies can be built as per the need of time at various stages of business expansion/growth.
Mentor,Advisor,Speaker & Writer with Rich Marketing Experience
As Country Head in Leading Indian and Multinational Corporation
in the Automotive/Tractor Industry