MAHINDRA FIRST CHOICE SERVICES

Making Inroads in the Indian Car Service Market

Mahindra builds 3 things: Products, Services and Possibilities

• A USD 16.7 billion multinational group based in Mumbai,

India, Mahindra employs more than 180,000 people in over
100 countries.

• Featured on the Forbes Global 2000 list in 2012

• Received the Financial Times ‘Boldness in Business’ Award

2012 in the ‘Emerging Markets’ category

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Operations spanning 18 industries in 10 business sectors

AUTOMOTIVE & FARM SECTORS FINANCIAL SERVICES SECTOR

Automotive Financial Services
Farm Equipment Insurance Broking
Agri-Business Rural Housing Finance
Energy
Construction
Equipment
SYSTECH SECTOR
INFORMATION TECHNOLOGY Aerospace
SECTOR
Information Technology Components
Steel

MAHINDRA PARTNERS Consulting

Steel
Retail
Indus TWO WHEELER
trial SECTOR
Equip Two
ment Wheelers
Logistics
Leisure Boats AFTERMARKET SECTOR
Solar Energy Used Cars Purchase & Sales
Service

INFRASTRUCTURE &
REALTY SECTOR
HOSPITALITY
InfrastructureSECTOR DEFENSE SYSTEMS
Hospitality
Real Estate Defense

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Aftermarket Sector

Aftermarket Sector

Mahindra First Choice Wheels

Mahindra First Choice Services
Buying and selling of multi-brand
Multi-brand car service
pre-owned cars

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What is Mahindra First Choice Services all about?

© 2014 Mahindra First Choice Services. All Rights Reserved

 What is Mahindra First Choice Services all about?

• Services all popular • Offers all major car • Strong network of 28

car makes and brand maintenance and company outlets
• Not dependent repair services • Presence in 17
on particular • Trained skilled cities across 9
brand technicians states
100% subsidiary of
the $16.7 billion
multinational Multi-Brand Complete range Pan India
Mahindra Group
Car Servicing 1 of solution
2 Presence 3
Branded Multibrand Service - High Potential
Market
26-30k
In US and Eurpoean markets, organized
multibrand has 33% market share. In India it has
~12% CAGR
less than 2% share of INR 12,000 Cr car service
market

12-14k
For the next 5 years, used cars market sales are
expecting a strong growth of 22-25% year on
year.

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Challenges faced by workshops without the support of a network

Lack of proper spares support

• Unavailability of spare parts in the workshop due to unreliable local supplies
• Difficulty in procuring parts in stipulated time
• Lack of proper spares sales forecast resulting in some inventory moving slow and other
inventory moving fast
• High inventory days in turn leading to locked in working capital

Difficulty in acquiring and retaining customers

• No clear differentiator to attract customer
• Standard lead time given to customer irrespective of load in the workshop which leads
to
delay in car delivery and in turn impacts customer satisfaction and retention of
customers
• Lack of customer trust in case of no brand

Difficulty in acquiring right technical skills

• Lack of proper training facilities
• Lack of access to an expert network
How willand
weright
helpITinsupport
overcoming these challenges??

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Our advantages to customers

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Services offered by us- Complete peace of mind for customers

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Why are we here?

MFCS Requirements Franchisee Partner Vision

• Rapid Network Expansion • A business that is Profitable
• Scale -up Operations through more • A business that is easy to manage
workshops • A business which can be scaled in
• Add local entrepreneur flair through future
franchise partners who • Partnership with a reputed brand
understands local market trends
and customer demography

MFCS Franchisee Program -

marries needs of both the
partners

Will this resolve the challenges faced by an Independent Garage running on its own?

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 Our Offering to Franchise Partners

MFCS Business
Long term usage of Model to ensure Hassle-free and
Technical training
MFCS brand continued reliable supply of
and SAP support
customer pull spares

National cashless Marketing support- Sustained higher Exposure to other

insurance tie-up Field & digital financial returns automobile
businesses

What differentiates us from competition?

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Long term usage of MFCS brand

• Franchisee will have access to MFCS brand and all related

benefits such as:
– Marketing elements in-line with MFCS marketing strategy – both external
(signage, leaflets, promoters etc.) and internal (signage, POSM, digital etc.)
– Internal database of potential customers – purchased from various sources
– Recognition as ‘Authorized Franchisee Partner’ of MFCS in all its
communications

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MFCS Business Model to ensure continues customer pull

In order to earn sustained profits it is essential to understand the customer needs

Local Garages
Co. Authorized
Service Center

•Many time the dealers change •Though the labour charges may be
parts even if they can be repaired lower, however, not sure of
• Lead times are long & unreliable genuineness of parts
•The charges are higher than the • Lead times are long & unreliable
independent garages •There is a limitation to
competence & scope of work

The need of the customer is high quality work (as experienced in dealers) at costs
lower than the dealers, and reliable delivery in shorter lead times.

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MFCS Business Model to ensure continued customer pull

The need of the customer is high quality work (as experienced in dealers) at costs lower than the dealers, and
reliable delivery in shorter lead times.

What Customer Needs mean

for MFCS

This guides our competitive edge of which will differentiate us from the rest:
• All general repair jobs completed in 1 day
• All other jobs in shorter lead times with ‘On Time Delivery’

What will ensure we upkeep our

competitive edge?
Capability to provide Operational Excellence &
On Time Delivery
service with quality Customer Centricity

On a backbone of reliable spares network

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 MFCS warehouse (Hub)

 Franchisee needn’t stock all inventory.

Centralized
MFCS will manage this at a Cluster Procurement
Retailer
Warehouse Distributor Parts Global at Cluster Level
Factory Sourcing -bulk orders
-higher margins
 MFCS will replenish daily/twice a day
(depending on location) MFCS
Cluster Hub

 Franchisee will maintain 3 days of Hub & Spoke

stock of consumable items Distribution
 For all other jobs – Franchisee will get -Milk run for
COCO
last
material on the same day/next day Franchisee
mile delivery
 Franchisee will still get the margins at par Franchisee
COCO
Franchisee

or better than local supplies

COCO and Franchise will be treated same by warehouse
 So, the question is - Why is MFCS carrying so much inventory?
 Principle of aggregation – by keeping inventory at one place we can meet the demand with a much lower inventory
because of high variability of usage at the service center
 We can bear the cost of carrying inventory because we think that better service to the customer (sales) will compensate
to the cost of inventory

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Hassle-free and reliable supply of spares

Focus on selected range of models instead of all models: % of Total Revenue

13.24%
• Analyse the local market and shortlist limited models
using Pareto approach
86.76%

• For Chennai cluster, analysis based on number of job

cards, revenue and parts sourcing revealed 33
models which account for 86% of sales revenue and Selected 33 Models Other Models
80% plus of market share

• The shortlisted models list is not constant. Models

will be added or deleted from the list based on
performance. To add any new model, MFCS will track
all the job cards that were refused. High frequency of
such refusals will be give us an indication of models
that needs to be added to the range

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Spares and Inventory Planning by MFCS - No parts from outside
supplier

Reliable supply MFCS will ensure supply of spares through its association with its
partners trusted supplier base

Better Margins You will be guaranteed margins at par or better than industry standard

You will be assured lower inventory days which in turn means lower
Low Inventory
working capital

Quality parts MFCS warranty on spare parts in line with OEMs will ensure you
assurance don’t have to worry about quality assurance
through Warranty
Complete By being your sole suppliers we will have an exact view of your inventory
Inventory load and help you manage it better
management

Lower Spares With MFCS having the complete spares backbone in place you will not
Manpower Cost have to deploy dedicated manpower which mean lesser manpower cost

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MFCS Business Model: Operational Excellence & Customer Centricity

Robust IT System Standard Operating Procedures

for transparency and control to ensure consistency in service
- Process Manual on ‘Managing Workshop’
SAP DBM
- IT Systems support in process implementation
System
- PMS schedule Multiple Customer Touchpoints
- Standard pricing to ensure customer convenience
- Control on discounts - Email
- Parts ordering - Toll-Free
- Tracking inventory - Website/M-Site
- Facebook
Strong MIS & Reports for - Twitter
Franchise Owner - Google +
Daily Reports on Operations,
Email
Productivity, Revenues, CSI customercare@
and many more mahindrafcs.co
m
Toll-Free
1800 22 4008

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National Cashless Insurance Tie-up

Tie up with various insurance companies for hassle free working-

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What differentiates us from competition?
Marketing activities on field

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Digital marketing on various automobile sites

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 Sustained higher financial returns

Standalone Garage VS MFCS Franchisee

- Lower margins on spares - Attractive margins on spares

- Lower customer base and retention - Customer retention and loyalty
- High attrition of manpower - Higher manpower retention and productivity
- Low manpower productivity due to brand association and training
- Low bay utilization interventions.
- High inventory of Spares - High bay utilization due to
- Periodic dead stock accumulation Operational Excellence
- IT Systems enabled business management
and control to boost productivity
- Low spares inventory and negligible
dead stock of Spares

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 Exposure to other businesses- added advantage

Being a partner with MFCS allows you to get an exposure to wide automobile business.

Huge nos of 4W data will help you in settling new businesses opportunities as Tyre,
Battery, Car detailing, Spare parts etc.

© 2014 Mahindra First Choice Services. All Rights Reserved

Our Offering to Franchise Partners

What differentiates us from competition?

© 2014 Mahindra First Choice Services. All Rights Reserved

MFC Coupon
Turbo Point Scheme Helps to Earn More
Buddy Program (Insurance Agent Meet)
Financials
Monthly Fees Tier C town (Tier wise)
Signup 5 Lac + Tax
Security Deposit 2.5 Lac (Refundable)
ASBM 47200 (Including Tax)
Spare Parts (IFK) 6 Lac
Royalty Fee (Yearly) 5.10 Lac + Tax

CRM IT
System Support
 Thank You

Contact Details

• Email: [email protected]
• Visit us: www.mahindrafirstchoiceservices.com/franchise