Effective planning reduces project delays, and government initiatives like Make in India are essential from both availability and cost point of view, says, Anand Sundaresan, Vice Chairman and Managing Director, Schwing Stetter India and Chairman, Infrastructure Equipment Skill Council.

The concrete construction equipment manufacturer has dedicated manufacturing bases for its concrete batching plant, concrete pump and transit mixer respectively and is planning new launches in sync with the trends in construction industry, Sundaresan says in an interaction with Karan Rawat of B2B Purchase.

How have the priorities in project procurement changed over the years with special focus on E-tendering?
As far as we are concerned, B2B is only limited to whatever we are purchasing i.e. component and other things. As far as sales are concerned, they are all B2C i.e., we are selling it directly to the end consumer. We don’t have any dealer or distributor. When you go for B2B purchases, we have adopted many new concepts like vendor-managed inventory for some of the components that we are buying which means they will supply it on a predetermined frequency and the inventory will be controlled by them. As we consume it, they will be invoiced by the vendor. Similarly, for C-class items also, we have combined around 136 vendors under one particular supplier to reduce the number of vendors to manage.

Based on consumption, we make payment to this single vendor. These are some of the new processes we have put in place. When it comes to selling, only scrap sales we are doing through Internet. Based on the accumulated level of scrap, we invite tenders pre-registered buyers to submit their bids in our portal. The highest bidder on level playing field on other terms will be permitted to take the scrap. We don’t use E-tendering route for our purchases.

How important is value over cost for your offerings?
Our company is a German company, so we attach high priority for the quality of the component getting into our equipment and also the life and performance of the equipment. If you compare our equipment with our competitor’s, even though we may be slightly higher by around 10 per cent, the value that the customer derives out of our equipment will be much more than the 10 per cent additional premium paid by them.

Discuss your latest technology or offering, USPs and applications.
Whatever product the company is supplying or offering, we always try to look at the operating cost of the equipment. If there are some wear parts, we always keep trying to improve on the life of the wear parts. Additionally, we also work on fuel economy.

Recently, we have launched Super Six concrete mixer that will help save almost 30 per cent on fuel consumption resulting in recovering at least 40 per cent of the cost of the equipment in five years only on account of fuel saving.

We are the first company in concreting industry to offer IoT solution in almost all our equipment. This will enable the customer to do proactive maintenance with availability of many statistical data on the equipment. Besides that, we keep on developing new products to improve the capacity and performance of our existing products. Construction equipment (CE) are service oriented and requires optimum network of service centres for uninterrupted operation of the equipment.

Operator training is one of the most important things, so along with the Infrastructure Equipment Skill Council (IESC), we are providing training to the operators as well as the mechanic. After-sales service and availability of spare parts is another key factor essential for our industry. We have training centres in four different locations, service centres in nine different locations, branch offices in 26 locations and spare-part go-downs 30 different locations in the country. Besides, we have also placed our service engineers in the project site itself to reduce the shut down time.

We keep on introducing some new products depending on the latest trends in construction segment. We have introduced some new products like concrete paving to cater to the huge road projects by tying up with an American company. We have introduced self-loading mixers and have also started selling the whole line of earthmoving equipment from our partner company XCMG.

How will it make procurement effective?
Since we go for the latest offerings on hydraulics, electronics etc., our lead time in procurement and availability reduces, as we don’t have to deal with obsolete items. With wide network of parts-depot, we are able to optimise stocking of expensive parts yet being able to cater to the customer requirement at short notice. Due to high usage of digital information and IT, we get information on life and performance of our equipment which helps us in optimising our procurement and inventory.

How initiatives like ‘Make in India’ are fuelling advancement in value-driven project procurement?
Undoubtedly, ‘Make in India’ is very important because most of these equipment at one point of time, were imported. However, in the last 10-15 years, most of these equipment are being manufactured in India. The market for construction equipment has increased substantially in the last 10 to 15 years. Therefore, it is essential to produce these in India to keep the cost low.

Hence, ‘Make in India’ is essential not only from the availability point of view but also from the cost point of view. In construction equipment industry, most of the people are driving only ‘Make in India’ project. Now predominantly, 80-90 per cent of the equipment required for infrastructure development are produced in India. More and more new companies with popular international brand names are coming into play with focus on producing some of these equipment in India. It’s a great initiative.

Most people are driving only ‘Make in India’ project in CE market as 80-90 per cent of the equipment are produced in India.
Anand Sundaresan,Vice Chairman and Managing Director, Schwing Stetter India