How accurate is an aftermarket credit policy.
How accurate is an aftermarket credit policy, Why a liberal credit policy for the aftermarket and how appropriate is this aftermarket credit policy for the customers. Let’s talk about this. Sevens does not follow a credit policy for automotive aftermarket sales.
Companies use liberal credit policy to increase their sales. Which is probably becoming a disease for business today. According to me, the sales executive who created this credit policy must have been there.
- He will probably be very weak in sales.
- Perhaps he must have been too scared of his goal.
- It will have little ability to motivate the customer.
Due to such liberal credit policy many people have lost their connection with each other. How many distributors and companies have lost coordination. There are many side effects available in the market today.
A company revolving around high sales aspirations and its educational liberal loan policy offers to increase its sales. Companies with the highest sales ambitions encourage customers to have longer credit times in the aftermarket. Today this credit policy has become not just a help but a business for the customers.
Presently this credit policy is reducing the creditworthiness of the product. Today you go to any aftermarket customer and they will find two brands of the same product. That’s because if not you then someone else is right.
The credit policy in the automobile sector has been neglected as much as in no other sector. While the consequences of this are also being seen horrifying. Let’s talk about this further.
- Have you ever taken medicine on credit?
- Have you ever taken the phone on credit?
- Have you ever taken your clothes on credit?
There are so many portals of online marketing which are selling automobile products, are all those companies giving credit.
Now we will talk about who does it affect in the after market.
High sales ambition
The ambition for high sales has created so much competition among companies that everyone is fighting among themselves. This competition is not for the quality of the product, this competition is running only for high sales and only under the credit policy. Which is not good for the automobile company. Perhaps the executives of the companies are also understanding this, but still they are silent.
Then what is the use of making good quality of product. If so, you stop singing this song, we are manufacturing a good quality product. Instead you start singing the song that our products are doing well in the market because we are giving high credit.
Transfer of Liberal Credit Policy
Currently, aftermarket customers are shifting to Liberal Credit policies. Just like a business. Like a company transfers its product. Distributes products to various distributors. The distributor also transfers that credit policy to retail or small dealers. The retailer transfers it to the garage owners.
Thus this liberal credit policy has been commercialised. A chain has formed in the market. Many fatal consequences of this are coming to the fore at this time and no one has the ability to stop it. Due to liberal credit policy companies and their officers became slaves of distributors because if they do not give credit, companies will not get distributors.
Role of Sales Marketing Manager
Due to the liberal credit policy, the sales marketing manager has no function of market motivation. The marketing manager’s job is just to take orders and collect checks and send them to the company. There is nothing left for the sales executive to do in the aftermarket. Because there is already a burden behind them. of sales targets and past dues. They get ready in the morning and leave the house and go and sit at the distributor’s place. Their work is not meant to be a product inspiration.
I have come across many such executives in the aftermarket who are colluding, flattering etc. with the distributor just to sell and clear their dues. Do sales aspiring companies give this training to their executives and if yes why do they need MBA. I am not saying that all companies are doing this but most companies are doing it.
Distributor model and late payment
Due to the flexible loan policy, the customer builds his loyalty in a different way. Because companies are serving them liberal loan policy from the front. As soon as the credit is received, the business of the customers starts. From retailer to retailer to garage to distributor and it goes on continuously as a chain. Due to which there is delay in payment and then excuses come to the fore. No payment, no payment.
Today 55 to 60 percent of all check bounce FIRs in India are running only in the automobile sector. This is also happening because the burden of wanting to sell more is being passed on to the customer who is not capable. My first company Purolator India where I also deposited 3 years old dues of customers whose number will be at least 9 or 10.
Conclusion
I never believe that all companies or their executives will act this way. I also do not believe that the liberal credit policy of many other companies would be working in such a simple way. All I want to say here is that the liberal credit policy has taken a different form than the bold and helpful steps on the part of companies for their customers. Which the customer has commercialized for his own self-interest.
You all probably know better than us how accurate an aftermarket credit policy is. I may have been proved wrong on several points for which I am sorry. But the liberal credit policy needs to be made very rigid rather than encouraged by its laziness. In the next post I will talk about different types of attractive schemes and discounts in the market.