Indian tyre maker CEAT Ltd., which started selling tyres at Kirana and grocery stores, has touched nearly 50,000 touchpoints in rural India.
The Mumbai-headquartered company plans to grow its touchpoints after stabilising the current ones.
“We are proud of the distribution network of tyres for two-wheelers as it is a differentiated model. We are selling in smaller towns through retail chains and puncture shops that have made a difference. People do not want to travel long distances to buy tyres for their vehicles; that is how we further penetrated,” said Anant Goenka, Managing Director, CEAT Ltd., to businessline.
The company has penetrated 615 districts and 10,000 towns in India and has collaborated with shops selling fast-moving consumer goods (FMCG) and essential products in the hinterland.
“We are constantly expanding our reach by looking at densely populated habitats and all kinds of outlets, including kiranas, within those habitats. It’s a continuous process at CEAT,” said Arnab Banerjee, Chief Operating Officer, CEAT
No price hike
The company will not be implementing any major price hikes owing to the dip in raw material pricing. The cost of crude oil derivatives and rubber has decreased since its peak.
“Crude peaked at 110 dollars per barrel six months ago, and now it is about 80 dollars per barrel, while natural rubber went up to ₹180 per kg and is now ₹145 per kg. There is a correction in the raw material prices; however, for us, there is a three- to four-month lag . This is due to derivatives and inventory in the chain. From the fourth quarter, we will see a reduction in raw material prices. Further, price hikes will be difficult, and there will be no hikes across the board at this point,” added Anant Goenka.
CEAT was awarded the “Lighthouse Certification” by the World Economic Forum. The certification is given to manufacturers that use fourth industrial revolution technologies to transform factories, value chains, and business models for sustainability, empowering the workforce and increasing productivity.