Avalon helps Indian automotive group bolster revenues

12 September 2019 Consultancy.in 3 min. read

Through a variety of strategic intervention across different sales and supply chain domains, management consultancy Avalon Consulting has helped a leading commercial vehicle dealership in India contend with faltering revenues. The financial impact of Avalon’s intervention amounts to eight times the fee that was paid for the consulting firm’s services.

Avalon has a comprehensive approach to supporting clients, structured into key areas of the sales lifecycle. The firm’s approach is based-on analytically identifying high-impact areas before taking action, allowing for significant benefits from minimal investments. The effectiveness of this approach has been demonstrated in a recent feat.

The client in question – a major commercial vehicle dealership – has been dealing with declining revenues, despite growth in India's commercial vehicle space. As part of a sales turnaround plan, the company sought to turn this scenario around by focusing on developing its crash-repair capabilities. However, there exist a number of regulatory barriers to enhancing that particular service line, making it harder for the client to shed its reputation as a “high-cost, high lead-time service provider.”

Avalon was brought on board to help navigate these issues and grow the crash-repair segment. Following an analysis of the business, several key performance indicators were targeted for improvement. These included: an “increase in vehicle inflow into workshops”; an “increase in revenue per vehicle”; and a “reduction in services turnaround time for each vehicle, while servicing more vehicles and more value per vehicle with the same capacity.”

Impact of our interventions

Once the tasks were laid out, Avalon began collaborating with various departments in the client’s operations, including the central service team, pilot workshops, client support, as well as external stakeholders. The work involved field-visits, analysis of operations to identify high-impact areas, designing solutions to implement in these areas, and closely supervising the implementation of these solutions – and improvising where necessary – until tangible outcomes were registered.

Avalon’s overall intervention can be catergorised into five initiatives. The first was a “leads scheme” to incentivise accident reporting and increase vehicle flow. The second step was to examine the stock-planning procedures and ensure efficient stocking and the availability of parts where and when required, thereby reducing response time.

The third initiative involved putting trackers on every vehicle, which could enable better coordination at the control level. The fourth step was to standardise the pricing system across service line, with exceptions pertaining only to regional variations in insurance policies, with the primary objective of building more trust. Lastly, the Indian-origin strategy consulting firm helped the client tie up with insurance companies to enable seamless and cashless payments, to make life a lot easier for its customers.

The comprehensive plan has materialised into a significant impact, with revenues increasing by as much as 14% in the first year after Avalon’s initiatives were implemented, and 31% in just half a year after that. The growth was driven by an increase in the number of repair orders, and a simultaneous drop in delivery time.