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Mercedes-Benz India officially kick-started its new 'direct to customer' sales model called Retail of the Future (ROTF) in the country. The German luxury auto giant first announced its plan to shift to the new sales program in June this year and it aims to bring more transparency between the company and the customer, along with the automaker's franchise partners. Under ROTF, the brand will directly sell its cars to customers, while its dealerships will deliver the cars while also ensuring servicing and other deliverables, who will be called franchise partners.
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With ROTF, Mercedes-Benz will directly sell its cars to customers, while its dealerships will take care of delivery, servicing and other deliverables
Under ROTF, Mercedes-Benz will own the complete stock of its cars and will sell them directly to the customer either online or through its showrooms. The automaker's dealerships remain intact and so do their service centres. Up until now, the company's dealerships purchased cars in bulk from the manufacturer, which would be then retailed to the customer. That component from the equation has been eliminated. With this transition, Mercedes-Benz India not only promises to offer better prices to all customers but also reduces the burden of inventory cost and warehousing of the stockpile on dealers.
Martin Schwenk, Managing Director and CEO, Mercedes-Benz India said, "With ROTF, we have created a completely unified customer journey experience with many industry-first initiatives to its credit. For the first time in India, there are no incidental or extra charges for the customers. Customers now have a direct access to Mercedes-Benz India's national stock with a wide variety of inventory choices. ROTF is a step in the right direction in getting closer to our customers, and a result of listening to their wishes and evolving requirements. As the most trusted luxury brand in the country, we have set a new standard in customer centricity, a new benchmark in Franchise Partners' profitability and introduced a new culture of competing only for the best customer experience."
While vehicle pricing, offers, invoicing and payment will be taken care of Mercedes-Benz India, insurance, registration and other formalities will be handled by the franchise partners
For the customer, the purchase experience will nearly be the same. But they will now be buying the car directly from Mercedes-Benz India. So the invoice raised won't be of a dealer but that of the company itself. This does remove the little room for negotiation in terms of prices that the dealer could offer from their end. However, they will now have access to Mercedes-Benz's entire carpark in India, and will be able choose their designed model, variant, and colour without any hassle. For the seamless working on this new retail programme, Mercedes-Benz India has registered with RTOs in 35 locations across India, and GST registrations in 22 states. Mercedes-Benz will also offer customised offers for special working professionals, existing Mercedes customers, corporate discounts among others, which can be selected at time of quotation generation.
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Customers will now get uniform and transparent pricing, larger stock availability for choosing, and better customers service as that will become the major focus areas for dealerships
However, the dealer will have access to a larger pool of cars from Mercedes-Benz India's stock. The dealer will also facilitate the delivery of the vehicle to the customer for added convenience. Given that the dealerships need not buy stocks in bulk, they do not block a lot of money for purchasing vehicles, which can be used elsewhere in terms of business growth.
The dealer or franchise partner will also be responsible for establishment, maintenance and growth of customers, and simplifying the delivery process. They will also continue with the marketing and engagement activities as well as servicing the vehicle. The pre-owned cars and accessories business will also remain with the dealer.
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