TI Cycles has worked out its own strategy to meet the competition - whether Chinese or domestic - head on. It has launched a scheme called Tiger to motivate its dealers into pitching for higher sales. Some 2,500 dealers and 25,000 sub-dealers have been chosen to be part of the Tiger scheme. The dealers will be ranked in terms of volume of business they have generated.

The top 300 will be put into the `Elite' bracket, which will entitle them to special privileges such as insurance cover and scholarships for their children. The top five dealers will get a car each. The next 20 dealers will get an all expenses paid, two-week holiday in Europe. The others in the Elite bracket will get white goods such as air-conditioners and refrigerators. Those falling outside the Elite bracket will get the usual gift items such as cycles, watches and clocks.

In addition, says TI Cycles president L Ramkumar, the company also plans to launch new models, open new warehouses in Lucknow, Indore and other parts of north India, and to establish 60 cyclinics all over the country. Cyclinics are service centres that cater to the requirements of cycle owners, undertaking repair jobs and providing spares.

TI Cycles manufactures around 1.8 million mountain terrain bikes (MTBs) every year, and enjoys annual sales of about Rs 280 crore. Mr Ramkumar says that in fiscal 2000-01 alone, the company introduced some 35 new models in the MTB and children's bike segments. Although Mr Ramkumar is reluctant to talk about Chinese dumping, he feels the Chinese cannot be competitive in the standard roadster bicycle segment, which accounts for some 65-70 per cent of the Indian bicycle market.

He explains why: The Chinese sell their bicycles at an average price of $25, about Rs 1,150. With a 40 per cent import duty, this goes up to Rs 1,610.

Local standard roadsters are available at around this price. That is why, says Mr Ramkumar, the Chinese will find this segment "unremunerative". But he points out that the Chinese could pose a threat in the children's bike segment, where they can supply models that cost as little as $8-12 (Rs 370-550). There is no hard evidence of dumping as yet, but Mr Ramkumar says he and the other local players are "carefully watching" the scene.

The Indian bicycle industry sells about four million bicycles a year and the market size is estimated to be around Rs 650 crore and growing at an average 15 per cent per annum. TI Cycles is part of Tube Investments of India Ltd, which is owned by the Chennai-based Rs 3,800 crore Murugappa group. Mr Ramkumar says that TI Cycles' strategic approach has made its brands, especially non-roadsters such as Hercules Top Gear, Hercules AXN and the kids' version of the BSA bike, quite popular. The company's traditional export markets include the UK, Germany and France, and fetch it revenues of about Rs 35-40 crore annually. All in all, Mr Ramkumar says he is confident that TI Cycles can look forward to sustained growth, Chinese dumping or not.