Product details

By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them.
You can change your cookie settings at any time but parts of our site will not function correctly without them.
Published by: Institute for Management Development (IMD)
Originally published in: 2017
Version: 16.09.2017
Revision date: 13-Mar-2018

Abstract

The case focuses on the challenges of achieving scale and profitability for an entrepreneurial business operating as a subsidiary of a large multinational company. Mahindra and Mahindra Ltd is the leading utility vehicle manufacturer in India and the largest-selling tractor brand by volume in the world. The company launched its aftermarket business in 1999 and the fledgling business was rebranded as Mahindra First Choice in 2008. Mahindra First Choice Wheels (MFCW) was in the business of selling and purchasing multibrand pre-owned vehicles, and Mahindra First Choice Services (MFCS) operated an automobile service chain. The case traces the growth challenges of the two companies as they shifted from a company owned and operated model to a franchise model to scale up aggressively, becoming India's largest multi-brand certified used car player and a leading service chain for out-of-warranty vehicles. Displaying an entrepreneurial spirit they continually innovated to launch first-of-their-kind cloud-based services, such as online auctions, pricing guides, service estimates, etc, which were well received by the market. However, profits were elusive. At the same time, the competition was escalating as a new breed of online players entered the used car market. Going forward, the CEOs of MFCW and MFCS had to chart the strategy for achieving sustainable growth and profitability: How should they demonstrate a proven business model for aggressive expansion? Should they sell stakes to foreign private equity investors to strengthen their growth objectives? Was it time to expand overseas?
Locations:
Other setting(s):
2008–2017

About

Abstract

The case focuses on the challenges of achieving scale and profitability for an entrepreneurial business operating as a subsidiary of a large multinational company. Mahindra and Mahindra Ltd is the leading utility vehicle manufacturer in India and the largest-selling tractor brand by volume in the world. The company launched its aftermarket business in 1999 and the fledgling business was rebranded as Mahindra First Choice in 2008. Mahindra First Choice Wheels (MFCW) was in the business of selling and purchasing multibrand pre-owned vehicles, and Mahindra First Choice Services (MFCS) operated an automobile service chain. The case traces the growth challenges of the two companies as they shifted from a company owned and operated model to a franchise model to scale up aggressively, becoming India's largest multi-brand certified used car player and a leading service chain for out-of-warranty vehicles. Displaying an entrepreneurial spirit they continually innovated to launch first-of-their-kind cloud-based services, such as online auctions, pricing guides, service estimates, etc, which were well received by the market. However, profits were elusive. At the same time, the competition was escalating as a new breed of online players entered the used car market. Going forward, the CEOs of MFCW and MFCS had to chart the strategy for achieving sustainable growth and profitability: How should they demonstrate a proven business model for aggressive expansion? Should they sell stakes to foreign private equity investors to strengthen their growth objectives? Was it time to expand overseas?

Settings

Locations:
Other setting(s):
2008–2017

Related