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Maruti Suzuki To Tap Young Entrepreneurs To Run Its Dealership Network

In its bid to sell 2 million vehicles by 2021-22, the country’s largest carmaker has already firmed up plans to double its dealership network to 6,000 outlets

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In its bid to set new benchmarks in auto retail industry to hold its ace position in the country, Maruti Suzuki India Limited is chalking out robust strategies to tap young entrepreneurs to run its new chain of dealership outlets at certain strategic locations. In its bid to sell 2 million vehicles by 2021-22, the country’s largest carmaker has already firmed up plans to double its dealership network to 6,000 outlets comprising both Nexa and its own branded showrooms. Among the 3,000 new sales and service outlets that would be set up at some prime locations in the country, around one-third of them are expected to be leased out to young and budding entrepreneurs. By adopting such a novel approach, the company can even open dealer outlets in smaller cities and retain a few key sites in prime locations of metros where it may be expensive going forward to run a dealership.

According to a source, “In the next couple of years, Maruti Suzuki will be leasing out its dealership network to young auto enthusiasts. What the company will simply do is build the infrastructure and let these modern entrepreneurs run its showrooms for a certain period of time. However, its traditional approach of appointing new dealers or expanding network with existing partners will remain on track. The main difference will be on the kind of approach that will be used by these young owners who may directly deal with the customers. In the initial phase, around 1,000 such touchpoints will be offered to these youngsters as a pilot test.”

When R.S. Kalsi, Executive Director - Marketing & Sales, Maruti Suzuki India was queried on this initiative, he said, “We have our well established dealer development activities and are going in line with that. Wherever (dealership) expansion is required, people are applying for it.  We have a systematic evaluation process and appoint our dealerships wherever it is required.”

It has also been reported in the media that Maruti Suzuki has earmarked Rs. 14,000 crore for buying real estate assets to increase their reach across the country. The company is investing a huge sum to open dealerships in strategic locations to get a hold of their opponents. 

Puneet Gupta, South Asia Manager -Vehicle Sales Forecast, IHS Markit, stated, “This can be a path breaking initiative and may play a key role in Maruti achieving its 2 million sales target in the next 4-5 years in the domestic market. We strongly feel Maruti Suzuki will innovate and will change the way how dealer networks are operated in the country. Many young & experienced professionals, who aspire to run a dealership but can’t do so due to fund crunch, may be able to own this dream. These professionals with their passion may challenge the way how the dealerships are currently operated by multi-millionaire people. This will not only bring the cost down but also make customers feel the difference as these professionals will be a lot more reachable to the consumer than the owners of the dealerships.”