MEAGAL STELPLAST :STEERING A NEW PATH:

HISTORY –Started by Anil Kishore in Mahipalpur Delhi having a reputation of high quality Automobile Horn mainly for replacement market
and aspiring to be a supplier for OEM as it can give regular orders. Land is owned by the group . They have improved their products over the
year and have acquired a reliable net work of suppliers.

CUSTOMER BASE – Both wholesale and retails

PRODUCTION – Monthly production 15000, (20%) 3000 units are sold as MSL brand and around 12000 to others who sell under their brand
/ selling price 150 / Ageing is 60 days .Generally Make to Order and prefer not to produce to stock , there is no order shortage except one
year .Major sales ( 80 % ) is from two models Classic Hero Honda Dia and Mithu Ac 72 Dia . Sales is unpredictable , peak season monsoon .

PLUS POINT IN LABOUR MARKET .They generally don’t face major labour unrest and got lower attrition rate .
COMPETION -About 10 competitors , All are SMEs , but the production capability of the nearest competitor is comparatively high as they produce
28000 .A lot of new entrants in industry , one of the failure for the new entrants was their inability to hire and retain good testers and the major issue is
low quality.

Branded Horns are being sold for Rs, 200 so the loss is 50 per unit and a total of 7.50000.

INDUSTRY OVERVIEW : Mostly unorganised SME , a few registered . ACMA helps these organisation to get certifications and standards like ISO
9000 TS 16944 etc . MSL is not registered under any Act

MARKET ESTIMATION: Indian auto component industry is expected to grow at a growth rate of 16 – 18%, but replacement market will have a
slow pace due to the competition from China .MSL is expecting to have a 14% growth .

THE PRODUCT : The working mechanism is almost similar to that of electric bell. The main components are copper wire and diaphragm that lead to
the assembly of all other components to form the final product.
The Rules.
Horns are notified under 119 (1) CMV rules , also covered under the BIS 18884-1993 .When Horns are fitted ( Automotive industry standard need to
be followed , also during new supplier introduction AIS 014 is also came into picture .
THE MANUFACTURING PROCESS :There are more than 35 components . There is no formal work measurement in place .Total number of
workers is 12 out of which two are testers .6 workers are regular salaried and 6 are under piece rate system. Plant work for 26 days @ 9hrs/day , and
usually there will be an approximate overtime of 3 hours and . Monsoon time is the busy time .There is no formal work measurement pattern is
followed in MSL. The monthly paid workers are initial employees and the second step hired are the piece rate system . The Piece rate wage
employees are 8% more productive than the monthly paid ones. Assembly was done in a batch mode and a disconnected worker paced
Variety of Horns – Company produces around 8 main varieties and 32 sub varieties

TESTING – Intital testing done as soon as finishing assembly and final testing after four hours of assembly under stimulated conditions. No in
process inspection . As per the process flow there are some bottle necks in between

TYPES OF ITEMS IN MSL’S BILL OF MATERIAL- Final , Component , Assembly .

HINDRANCES IN PRODUCTION AND PLANNING PROCESS

 Make to Order – Because of erratic demand

 Inventory - there is no formal ordering method they reorder when the stock reaches 500 – The expensive items like copper wire etc are
maintained as per requirement
 Typical lead time – 4 days
 Supplier needs to be paid in a week
 Inventory and billing manual a lot of time required
 No formal production standards
 Workers unwilling to use automation devices also management suspects some pilferage
 There is no proper information system hence they are unable to establish .
 The warranty time is three years , they are expecting a 10 % return during warranty . They honour warranty
 MNREGA leads to shortage of work forces

FUTURE PLANS
 A lot of free space
 They are considering the idea to move out of Delhi due to Building and Land regulation
 They are considering to enter OEM Market – then certification and standards adherence will be essential

 Since there is no certification required for replacement market they have not yet decided that also
 They are yet to decide whether piece rate or monthly wage
Suggestions

They have to identify the typical bottle necks and arrange people in such a way to avoid same .
They have to decide whether full timers or piece rate system employees required .As both have advantage and dis advantage .
They have to understand how much idle time is there and what is the standardized time
Since space there whether to expand further is also need to analysed