Financial Daily from THE HINDU group of publications
Tuesday, Mar 08, 2005
Marketing - Channels and Franchises
TI Cycles bets on exclusive franchisee route for growth
Chennai , March 7
TI Cycles of India, a Murugappa group company, is opting for exclusive franchisee route to sell more cycles. All variants of its 80 models of cycles, accessories, fitness equipment, after-sales service and easy purchase options in one place - at the TI Cycle World - is what the company is offering buyers.
Addressing reporters at the inauguration of the second TI Cycle World here on Monday, Mr Mohit Khattar, Vice-President, TI Cycles, said that a TI Cycle World would thus meet the needs of the company's entire market segment.
They could expect to see the entire range at company assured prices and guarantees. Facilities would also be available for the prospective buyer to test-ride cycles and get it delivered at his doorstep, exchange old cycle for new, use a credit card to buy, or opt for hire purchase, he said.
The point of the exercise in this franchisee model is to offer the customer something more than what the neighbourhood multi-brand cycle dealer would offer.
A satisfied customer talking of a happy experience is a sure route to attracting more. For instance, at the first TI Cycle World opened nearly a year ago, cycle sales have doubled compared with sales when the franchisee was just another dealer, according to Mr Khattar.
To the company, the value is not in just increasing sales but also building its brands. In the utility segment, brand awareness is high. Over 80 per cent of the customers know what make they want.
In most other segments only about 50-60 per cent look for a particular brand. An exclusive outlet showcasing what the company has on offer will strengthen the brand, he said.
TI Cycles is hoping to first set up over 25 such franchises in the top six-seven cities, including the metropolises. In Tamil Nadu, they would come up in Coimbatore and Madurai soon. In Chennai alone it hopes to set up four, with the third expected in April.
TI Cycles has been experimenting with novel marketing options. Earlier it was the `Cyclinic,' where a customer could get specialised after-sales service at a dealer. A TI Cycle World goes beyond that concept, Mr Khattar said.
TI Cycles makes and markets cycles in three brands BSA, Hercules and Philips and has a 30 per cent share in a market where industry estimates peg cycle sales at about 10 lakh a year.
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