INDIA Motor Parts & Accessories Ltd (Impal), the automobile parts distribution company belonging to the TVS group, is in the process of networking all its branches that will help it maintain a better control over inventory.

Covansys has developed the software package and is implementing it for Impal, according to Mr N. Krishnan, Managing Director, Impal.

He told presspersons here on Thursday that about 35 of the 53 branches have been connected and the remaining will be linked soon.

Once the package  Covansys Retail Transaction System  is installed in all the branches, Impal will be in a position to maintain a better control over inventory, thus reduce holding costs and be more competitive in the market. Also, the package will prevent duplication of stocks, especially of the slow moving parts.

The Windows NT-based package, according to the company, supports both offline and online transactions and is operational both on the Internet and Intranet. It can be migrated to provide a B2B solution.

Without disclosing the cost of the package, Mr Krishnan said that Impal had not bought the proprietary source code and hence Covansys could sell it for other auto parts distributors also. Both Mr Krishnan and Mr S. Narayanan, Chairman, Impal, emphasised that maintaining a strict control over inventory was one of the ways to remain competitive, especially when original equipment manufacturers (OEMs) were themselves entering the spare parts business.

Although this affected the company's business, they were confident that given Impal's strengths - a low-cost, spare parts distributor with a nation-wide network; long-term relationships with both the component manufacturers and its own customers; and efficiency of operations - would help the company.

In its 50th year, Impal was confident that there was space in the aftermarket for independent companies like itself, even when OEMs were getting aggressive with extended warranties and when parts quality were improving.

Impal, Mr Krishnan said, was also looking at new opportunities to grow. One of this was a tie-up with Pricol for distributing its vehicle security alarm systems. Impal had also signed up with Fenner, and expected good business from this.

To questions, Mr Krishnan said that the decline in engine overhauls had affected the company's engine component business.

This was one of the reasons for Impal's topline taking a hit in the last five years, he said, and added that this had levelled off now.

However, the company was able to compensate the decline in business from the engine component segment with growth in other segments. There was also a slight revival in the engine component business.

Besides, the switch-over to air brakes in vehicles from hydraulic brakes would also affect the company and it hoped to tackle this by pushing more business in friction material and air brake parts, he said.