Maruti starts vendor audit to consolidate leadership position
NEW DELHI: Maruti Suzuki India Ltd has started its maiden performance audit of vendors and also introduced a so-called ‘purple band’ for the most efficient suppliers as it seeks to ensure its goal of retaining the leadership of the domestic market by producing up to five million vehicles by 2030, said three people directly aware of the development.
The company expects the exercise spanning its entire vendor base including Tier 2 and Tier 3 suppliers to help improve product quality and sustainability of its vendors, said the people, who did not wish to be named.
The initiative has been taken to boost the synergy between the vendors and the company as the management feels the vendors are crucial partners and will act as a catalyst to growth in the future, according to the people mentioned above. “Maruti already has an established mechanism for judging its vendors and this purple band was introduced as it wants to encourage its vendors to invest more in line with the company’s expectations,” said one of the three persons mentioned above.
“There are almost 11 parameters and companies that are able to meet 85% to 90% of the parameters will be put in the purple band,” the person said.
The exercise is also being undertaken to urge vendors especially Tier 1 to invest more in research & development, which will enable Maruti to develop and design more vehicles in India, they said.