TVS Motors Company Overview

TVS Motor Company with revenue of US $2.9 billion is the 3 rd largest two-wheeler company in
India. The company has recorded an annual sale of around 3 million automobile units and has an
annual production capacity of more than 4.95 million vehicles. TVS Motor Company is the 2 nd
biggest exporter in India, exporting to more than 60 countries in the world. A member of the
TVS Group, it is the largest company of the group in terms of size and turnover. TVS Motor
Company has manufacturing facilities across the globe, including geographical regions like
Africa, SE Asia, Middle East, Latin & Central America and the Indian subcontinent.

Manufacturing Locations

TVS Motor Company has mainly 4 manufacturing facilities, one manufacturing facility at
Karawang Indonesia and the remaining 3 located in India

i. Hosur in Tamil Nadu

ii. Mysore in Karnataka
iii. Nalagarh in Himachal Pradesh

TVS Motor Distribution Network

The company followed hub and spoke distribution network having 8 company owned and
managed warehouses at strategic location covering maximum geography of the country. The
network comprised of two key collaborators first being the Area Main Dealers (AMDs) and other
being the Area Dealers (AD). The AMDs catered to a larger geographical region and supported
the Ads within their region to supply TVS motor to different parts of the region. Each AMD
would typically handle 3-4 ADs depending upon the potential and the size of the region
Flow of Goods from Producer to End-Consumer

TVS Factory TVS Ware Houses Area Main Dealers Area Dealer
End Consumer
(Total 3 Factories) (Total 8 Warehouses) (Around 1030 AMDs) (Around 3500 ADs)

The flow of goods starts form the factories premises and they stocked up at different warehouses
of the company. The stocking done at each warehouse is dependent upon the sales forecast for
each region and the lead time of transporting material to the warehouse location. Goods are then
transported to the AMDs warehouses, and the AMDs distribute it to the respective ADs of their
region. While both AMDs and ADs and directly sell to the customers, the ADs cannot place
direct order to the company’s factories or warehouses.

Key Elements of TVS Distribution Network

Customer Service: As soon as the customers enter a TVS showroom a sales executive is
assigned to him/her. The customer is then briefed about the choices available along with the
price, availability and financing option. The feedback of the customer is collected at the end of
visit on the NPS (Net Promoter Score) and PSF (Post Sales Feedback) system to provide them
better services in the next visit. Before the customer leaves with their vehicles a Pre Delivery
Inspection is done and they are informed about vehicle servicing and post sales services

Order Processing: ADs place their order to the respective AMDs. While the AMDs place their
orders to region warehouses and warehouses to the regional company warehouses. AD can place
order directly at the company warehouse only under very special circumstances. The order
details and all the customer interactions data from enquiry to final invoice is feed in the DMS
(Dealer Management Software) application. The DMS data is linked with the company servers
and gets incorporated into company’s SAP systems. Thus company is able to track all the
activities happening at the dealer location
Warehousing and Inventory Control: The company warehouses keep the stock depending
upon the regional demand forecast and the lead transit time between the factories to the
warehouse. For the fast moving SKUs, usually a stock of 30 days is kept for each such SKU. The
categorization of the SKUs into fast moving or slow moving category depends form region to
region. For TVS Mopeds and Scooters are fast moving SKUs in the eastern region while the
Motor Cycles are the fast moving SKUs in the eastern states of the country

Transportation Mode and Materials Handling: Vehicles are transported through dedicated
trucks in normal scenario but during peak period railways are also used as means of
transportation. The trucks trollies are designed to avoid maximum transportation damage and
ensure maximum space utilization. Depending upon the order quantities and the travel distance,
trucks come with minimum capacity of 30 vehicles to maximum capacity of 130 vehicles.