Before the reader starts getting a sense of déjà vu (the last article was about ‘Cycle’ Brand Agarbatti), let me clarify that this article is really about cycles! More particularly, it is about the world’s largest producer of cycles — Hero Cycles.
It was predicted that the cycle would go the way of the Dodo in the 21st century: that with the easy availability of better, motorised and more efficient transport options, it would become irrelevant and obsolete. That prophecy couldn’t have been more wrong. Cycles are more popular than ever the world over, both as a means of transport and as a way to stay fit,
In India, a cycle is not just a means of conveyance. It has been proven to increase employability of both men and women; naturally, the household income also goes up. It is also said that ownership of a cycle increases self-confidence among girls and women because of the independence that mobility brings.
Add to this the fact that cycling is an affordable, pollution-free, healthy mode of transport and it becomes obvious why, even globally, more people than ever before are using cycles today.
Oldest in India
And the company making the most of this market — both Indian and global — is Hero Cycles, the oldest company in the Hero Group.
As is so often the case, Hero Cycles too had humble beginnings – in a garage, to be exact — in 1944. The founders were the four Munjal brothers — Dayanand, Satyanand, Brijmohan and Om Prakash — who hailed from a small town called Kamalia (now in Pakistan). They noticed that though there were many cycles on the roads, the means to repair them were few, and decided to start a business supplying cycle spare parts in Amritsar. It showed good growth but the problems following India’s struggle for Independence and the subsequent Partition forced the brothers to shift their operations to Ludhiana, Punjab.
The business really took off from here. From manufacturing spare parts for cycles to assembling entire cycles was a logical step, and the company soon had a capacity of 25 cycles a day. As its reputation spread, it attracted the best talent among engineers and skilled workers, and the capacity increased to more than 600 cycles per day.
The company was incorporated as Hero Cycles Limited in 1966. By 1968, it had moved to new premises; a rim-making division was started in 1971; production doubled and by 1975, Hero Cycles had become India’s largest manufacturer of cycles. Today, its main business activities cover manufacturing of cycles, CR (cold rolled) strips and auto components. Cycles contribute to the lion’s share of the revenues.
(Interestingly, the place where the first manufacturing plant (still operational) of Hero Cycles came up is known as Hero Nagar, and Ludhiana is known as the cycle hub of India.)
World’s largest cycle-maker
The next step followed naturally; in 1986, Hero Cycles was acclaimed as the largest cycle manufacturer in the world by no less an authority than the Guinness Book of World Records. Today, it continues to hold that position. An over 2,000-strong dealer network, nurtured right from the beginning, supports the sales operations. In fact, vendors, dealers and other associates share in the company’s prosperity. According to the World Bank, Hero Cycles is a role model in vendor development.
Hero Cycles also has the reputation of being an excellent employer — there is no organised labour union, most employees have worked there their entire lives, till retirement, and job opportunities in the company are extended to family members of employees. Its management style has won international acclaim. The late CEO, Om Prakash Munjal (known as the Cycle King of India) is said to have known almost all his employees and dealers by name. His son, Pankaj Munjal, is the present MD of Hero Cycles.
According to published data, by 2012, the company was manufacturing 13 crore cycles every year. Today, Hero Cycles is said to hold about a 48 per cent share of the Indian cycle market. It has manufacturing plants at Ludhiana, Ghaziabad, Patna and Colombo (Sri Lanka), with each factory dedicated to the production of a specific range of cycles. An interesting feature is that the company has no warehouses, preferring to load all finished/ assembled products on to trucks by day-end for delivery.
Maximising productivity
The Japanese ‘Just in time’ concept of inventory management has been adopted by the management to minimise wastage and loss, maximise productivity and speed up delivery time. This means that everything from raw material procurement to manufacture and assemblage is done to targets set on a day-to-day basis.
Hero Cycles is said to have been the first company to come up with the electric bike, the mountain terrain bike, the city bike and the racer bike in the Indian market. From the traditional black cycle to the electric one, the range of cycles manufactured by it include all the above as well as special bikes for women and children.
Across these categories, Hero Cycles serves different customer profiles by offering cycles at prices that appeal to every economic group. (The cycles are priced between ₹3,000 to ₹4 lakh.) The company’s latest product is the Lectro, an Electric Pedal Assisted Cycle (EPAC). This eco-friendly transport mode is available in three models (priced between ₹40,000 and ₹85,000) and has Bluetooth synchronisation facility and GPS.
Certifications
Having their own machinery fabrication unit has helped Hero Cycles innovate and customise to meet the specific needs of consumers, such as introducing new frame designs and features, using light metal for its super-light bikes and adding shock absorbers and speedometers. The company has a ‘zero-defect’ policy and holds the ISO 9001, ISO 9002, BVQI (Bureau Veritas) and ISO 14001 (environmental compliance) certifications.
Exclusive retail outlets for each category of bike — named ‘Hero Zones’ — coupled with easy finance options, help draw in and retain customers. Recently, to make its cycles available online, the company tied up with Sports356.
Recognised globally
The brand is recognised in more than 80 countries worldwide. Hero Cycles has gone for a number of acquisitions abroad to make its presence felt in the international market: it bought Firefox Bikes Ltd and holds a majority stake in UK’s Avocet Sports and Sri Lanka’s BSH Ventures. There are plans to set up a high-tech Global Design Centre at Manchester, UK.
Hero Cycles’ CSR activities include setting up of camps for heart and eye check-ups, blood donation and family planning drives, rehabilitation of villagers, and so on. The company also administers a hospital and runs six schools and a college.
Over the years, Hero Cycles has garnered several awards and recognitions, foremost among them being the Engineering Exports Promotion Council’s ‘Best Exporter Award’ — for the last 28 years in succession!