SUMMER TRAINING PROJECT

ON
HERO CYCLES LTD

PRESENTED BY:
NAGENDER SINGH SHEKHAWAT

BICYCLE
A bicycle or cycle is pedal- driven, human
powered vehicle with two wheels attached
to a frame, one behind the other.

The basic shape and configuration

not changed

Details improved-modern materials

and CAD

INDIAN BICYCLE INDUSTRY

MAJOR PLAYERS IN INDIA IN BICYCLE INDUSTRY

HERO CYCLES
ATLAS
AVON
TI

LOCAL PLAYERS OPERATING

IN PUNJAB
S.K BYKES
RAJA CYCLE
SUN CROSS
EVERBEST
TOP TRACK

HERO GROUP

Hero Group ranks amongst the Top 10 Indian

Business
Houses

Started in 1944, started business of bicycle

spare parts in Amritsar.

By 1956, began to assemble the entire cycle at

their manufacturing plant in Ludhiana.

In the early days, the plant had a capacity for

25 cycles per day and now it is about 18,000
per day.

Hero Cycles Limited

Hero Honda Motors Limited
Hero Cold Rolling Division
Hero Motors Limited
Hero Exports
Majestic Auto Limited
Rockman Cycle Industries
Highway Cycle Industries
Sunbeam Auto Limited
Munjal Auto Industries Limited
Munjal Showa Limited
Munjal Castings
Munjal Auto Components

Hero Global Design

Hero Corporate Services Limited
Hero ITES
Hero Mind mine
Hero Soft
Munjal e-systems

Easy Bill Limited.

HERO CYCLES

Type
company
Founded
Headquarters
Industry

Public Ltd
1956
Ludhiana
Bicycles

MISSION OF HERO
CYCLES
Continuously striving for
synergy between technology,
systems and human resources
to provide products and services
that meet the quality,
performance, and price
aspirations of the customers.

QUALITY POLICY
Hero cycle limited shall have to stay in Global
mainstream by continually innovating products and
services and instutionilizing its efforts for Quality and
Productivity improvement
Through
Effective leadership, Human Excellence, Technological
up gradation, Appropriate work environment and ensuring
compliance to applicable regulatory requirements
Thereby
Enhancing the Customer confidence.

SWOT ANALYSIS
STRENGTHS

Management with vision

Good corporate image
Location advantage
Strong brand image
Good customer base
Good infrastructure facilities

WEAKNESSES
Packaging material not of the required
standards
Damages during transportations
OPPORTUNITIES
Growth in auto sector
Rising economic standards in states like UP.
Growth in economic structure will put
company in driving seat(E-bikes).
Increase in demand of kids cycles.

THREATS
Local / non branded
manufacturers of cycle parts.
Chinese cycles entering in INDIA
in big way.
Motor bike industry is damaging
business.

FINANCIAL ANALYSIS
Current ratio = (Current Assets
/ Current Liabilities)
2006-2007

2007-2008

2008-2009

Current
Assets

3,514,169,012 4,078,120,805 4,500,174,202

Current
Liabilities

2,174,339,220 2,117,280,044 1,897,907,454

Current
Ratio

1.61

1.92

2.37

FINANCIAL ANALYSIS
Cash Ratio= Absolute Liquid Assets /
Current Liabilities
2006-2007
Absolute
Assets

Liquid 22,134,657

2007-2008

2008-2009

151,600,603

1,52,820,715

Current Liabilities 2,174,339,220 2,117,280,044 1,897,907,454

Cash Ratios

0.0101

0.0716

0.0805

FINANCIAL ANALYSIS
Working Capital =
Turnover Ratio
Capital
2006-2007
Net Sales
Net
Capital

Net Sales /
Net Working
2007-2008

2008-2009

13,308,705,11 12,850,038,96 14,901,978,24

6
9
7
Working 1,339,829,792 1,960,840,761 2,602,266,748

Working Capital 9.93

Turnover Ratio

6.55

5.73

FINANCIAL ANALYSIS
Average Collection Period of Debts = Days in
the year/
Debtors Turnover Ratio

Years
Days
in
the year
Inv.
Turnover
Ratio
Inv.
Conversio
n Period

2007
365

2008
365

2009
365

14.92

11.96

13.65

25
days

31
days

27
days

FINANCIAL ANALYSIS
Inventory Conversion Period= Days in the
year/
Inventory Turnover
Ratio
Years

2007

2008

2009

No. of Days in 365

the Year

365

365

Debtors
6.51
Turnover Ratio

6.12

6.81

Average
56 days
Collection
Period of Debts

59 days

54 days

FINANCIAL ANALYSIS
Gross Profit Ratio=( Gross Profit/
*100
Net Sales)
Year

2007

Gross Profit

1,575,635,3 1,412,590,7 2,036,019,5

49
33
69

Net Sales

13,308,705, 12,850,038, 14,901,978,

116
969
247

Gross
Ratio

Profit 11.83

2008

10.99

2009

13.66

FINANCIAL ANALYSIS
Net Profit Ratio= (Net Profit After Tax /
Net Sales )*100
Years

2007

2008

2009

Net Profit

1,006,668,276

675,309,685

576,997,711

Net Sales

13,308,705,116

12,850,038,969 14,901,978,247

Net Profit Ratio

7.56

5.25

3.87

TITLE OF RESEARCH

A study on dealers perception

on cycle industry in Punjab

NEED OF STUDY
Dealers-

drivers of business
To know the dealers satisfaction
towards Hero Cycles Ltd.
The study would give ideas in terms
of the expectations of dealers and
their suggestions for better business.
The study would also suffice a
comparative study of major cycle
brands.

OBJECTIVES
To

know cycle brands dealt with by dealers

along with the market share of major
brands.

To

find the factors of satisfaction and

dissatisfaction regarding major players in
cycle industry

To

find the market leader of cycle industry .

To

identity the dealers suggestions and

expectations with respect to the cycle
industry
.

RESEARCH METHODOLOGY
DESIGN-

Descriptive
POPULATION- Bicycle dealers in Punjab
SAMLPING UNIT- Each dealer who has filled
the questionnaire is the sampling unit.
SAMPLING TECHNIQUE -Non probability
convenient sampling
DATA COLLECTION
PRIMARY DATA
SECODARY DATA

LIMITATIONS IN RESEARCH
AREA RESTRICTION
SAMPLE

SIZE

MINDSET OF DEALERS WHILE

SHARING INFORMATION
SHOP INCHARGE

OWNER

MAY NOT BE THE

EXPERIENCE IN DEALERSHIP
120
P
E
R 100
C
E
N
80
T
A
G
60
E

O
F

D
E
A
L
E
R
S

100

40

20

YEARS

No

fresh entrants
in form of
dealers

AUTHORIZED DEALERSHIP OF
VARIOUS COMPANIES
120

100

P
e
r
c
e
n
t
a
g
e

100

80

60

40

o
f

20

d
e
a
l
e
r
s

59.52

66.67
40.48
19.05

Hero

cycles tops
the no of
authorized
delaers
Others are the
least in this line

DEALING OF CYCLES OF VARIOUS COMPANIES BY DEALERS

120
p
e 100
r
c
e
n 80
t
a
g 60
e

o
f

d
e
a
l
e
r
s

40

20

100

65.12

90.7

72.09
48.84

All

dealers sell
Hero cycles
Local brands are
highly sold after
Hero brand

TOTAL PERCENTAGE
SALES(MONTHLY) BREAKAGE FOR
VARIOUS CYCLE BRANDS

14.79

Hero
8.52

52.92
15.28
OTHERS
8.49

Atlas

Avon

TI

CYCLE BRAND RECOMMENDED TO CUSTOMER BY DEALERS

120

97.67

100

80

P
e
r
c
e
n
t
a
g
e
o
f
d
e
a
l
e
r
s

60

40

20
2.33
0

CYCLE BRAND HAVING

MAXIMUM COMPLAINTS
P
e
r
c
e
n
t
a
g
e

50
44.19

45
40

37.21
34.88

35
30

30.23
25.58

25.58

25
20
15

o
f

10

d
e
a
l
e
r
s

Hero

Atlas

Avon

TI

Others

NONE

COMPLAINT HANDLING
ABILITY
OF VARIOUS CYCLE
COMPANIES
A
1.47
1.6

V
E
R
A
G
E

2=HIGHLY
SATISFIED

1.4
1.2
1

1=SATISFIED

0.8
0.6

0.42

0.4

R
A
T
I
N
G

0.2
0

0.24 0.27
0.03

0=AVERAGE
-1=DISSATISFIED
-2=HIGHLY
DISSATISFIED

PROMPTNESS OF CYCLE COMPANIES TO RESPOND TO

REQUESTS/ENQUIRIES OF DEALERS

1.4

1.2

A
V
E
R
A
G
E
R
A
T
I
N
G

2=HIGHLY SATISFIED

1.19

1=SATISFIED

0.8

0.54

0.6

0.43
0.4

0.2

0=AVERAGE

0.38 0.41

-1=DISSATISFIED
-2=HIGHLY
DISSATISFIED

PRICE JUSTIFIABILITY OF CYCLE COMPANIES ACCORDING TO DEALERS

0.89

0.9

A
V
E
R
A
G
E
R
A
T
I
N
G

2=HIGHLY
SATISFIED

0.8

1=SATISFIED

0.7
0.6

0.58

0=AVERAGE

0.5
0.4
0.3

0.34

0.36

-1=DISSATISFIED

0.28

0.2

-2=HIGHLY
DISSATISFIED

0.1
0

Hero Atlas

Avon

TI

Others

REQUIREMENT OF TRAINING TO HANDLE

HIGH-END CYCLES PROBLEMS

OPTIONS
YES
NO

Few

NO OF
RESPONSES
40
3

PERCENTAGE
93
7

dealers say that training should be given frequently

Few say that once given, it can be spread to other
mechanics
But all agree that they require training.

FACTORS CONSIDERED TO BECOME DEALER OF A CYCLE COMPANY

P
e
r
c
e
n
t
a
g
e
o
f
d
e
a
l
e
r
s

120

100

100

80

78.57

64.29
60
50

40

20

Quality

Schemes Company Policy Margin

Others

COMPANIES DOING PROMOTIONAL

ACTIVITIES ACCORDING TO DEALERS
P
e
r
c
e
n
t
a
g
e
o
f

50

46.51

45

39.53

40
35
30
25
20

20.93
16.28

15

11.63

13.95

10
5
0

d
e
a
l
e
r
s

Avon

Atlas

Hero

TI

Others

None

COMPANIES EXPECTED TO GET ADDITIONAL

MARKET SHARE IN FUTURE ACC. TO DEALERS

80
74.42
70

60
P
E
R
C
E
N
T
A
G
E

50

40

30

25.58

20

16.28

10
2.33
0
Hero

0
Atlas

Avon

TI

Others

FINDINGS AND RESULTS

No

fresh entries in form of dealers in the

cycle industry

Dealers

also deal with other companies

apart from Hero cycles

Many

dealers feel that there is need of

more promotion

Most

of the dealers are satisfied the most

from Hero as compared to other brands

FINDINGS AND RESULTS

Other

brands are growing rapidly even

though their authorized dealership is very
less

Avon

is performing better than Atlas in

terms of sales even with less no of dealers

Dealers

are mostly not satisfied by the

margin and bonuses which they get

The

high end cycles need specially trained

mechanics to solve the problems

SUGGESTIONS
Need

of better promotional activities

and margin

Complaint

handling ability should be

maintained

Company

should not lose its quality

standards at any cost

Promotional

kinds.

activities of different

Contd..
Proper

training
Feedback from dealers
Inspection
Different advertisement like T
shirts
Take care while packing ,loading
and unloading
Attractive color schemes