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CASE STUDY

The Case Of Contract Manufacturing

SYNOPSIS: Roadmaster Tyres had managed to climb to the No. 2 spot in the replacement market for truck tyres. But the company's foray into passenger-car tyres was in hot water, with an OEM contract with the country's largest car-manufacturer not being renewed. Chintan Bakshi, the CEO of the company, found himself caught in a quandary. Roadmaster Tyres could continue to focus on the truck-tyres segment and be profitable, but, essentially, be a commodity company. Or it could leverage its presence in the OEM market for passenger-car tyres, invest in brand-building, and go the retail way. Both had their merits. And demerits.Cummins India's Y.S. Joshi, modi Xerox's K. Swethanarayan, SAS Institute's Gourish Hosangady, and John Fowler (India)'s R.L. Kumar debate Roadmaster's ideal course of action. A BT Case Study.

As his new Mercedes-Benz E-Class-perhaps the only vehicle of its kind in the world that ran on Roadmaster-T5 radials-swung into the private two-lane metalled track that led to Roadmaster Tyres Limited's huge manufacturing-facility on the outskirts of Baroda, the thoughts of Chintan Bakshi, its 51-year-old Chairman and Managing Director, kept returning to something his father, Raman Bakshi, the founder of the company, had once told him. ''There's something peculiar about our business,'' Bakshi Sr had said. ''Every one of our successes, no matter how large or small, is immediately followed by failure.'' He c