ABOUT THE COMPANY
Managing supply chains at scale
This Series B industrial manufacturer operates with 800+ active vendors across raw materials, components, and logistics. Revenue is ₹1,400 crore, growing 25% YoY. Their sourcing team is lean but effective,they move fast, negotiate hard, and manage relationships closely. However, they relied on manual quarterly vendor reviews and occasional CIBIL checks. Critical legal or financial changes at vendors were often missed until they affected deliveries or payment terms.
INDUSTRY CONTEXT & DEMAND
Vendor risk is growing, but monitoring is manual
Supply chain disruptions cost Indian manufacturers an estimated 8-12% of margins annually. IBC (Insolvency and Bankruptcy Code) filings have increased 40% YoY since 2021, but manual vendor reviews can't catch these in real-time. Directors, NCLT petitions, litigation, and payment defaults spread faster than quarterly reviews. Enterprises need continuous, automated vendor monitoring to avoid surprise disruptions and renegotiate terms before vendors fail.
THE CHALLENGE · BEFORE
Quarterly reviews, blind spots, surprise defaults
Vendor due diligence was done quarterly, typically a 2-week sprint before board reviews. Each vendor required manual searches of GST records, court filings, CIBIL, and media,a 4-5 hour process per vendor. Critical events (director fraud, NCLT filings, contract defaults) were discovered only when they affected operations. In the previous year, hidden defaults at 11% of the vendor base were discovered only after payment issues arose.
- Quarterly review cycle; critical events slip through between quarters
- Manual NCLT/litigation searches; average 4-5 hours per vendor
- Fraud incidents: 3 in the previous year (totaling ₹14 crore exposure)
- Hidden defaults: 11% of active vendor base had undisclosed payment defaults elsewhere
- Audit responses: 1 week turnaround on vendor risk queries
HOW AICA HELPED · THE SOLUTION
Daily monitoring across 800 vendors, six-dimensional risk scoring
AICA's Vendor Due Diligence module was deployed to monitor all 800 vendors daily. The system ran 250+ checks per vendor,director backgrounds, NCLT/litigation feeds, bureau data, GST compliance, contract defaults, and media mentions,and scored each on six dimensions: legal, financial, operational, regulatory, reputational, and structural. Continuous EWS alerts flagged any change within 4 hours. Litigation feeds connected to real-time court databases, eliminating blind spots.
- Vendor Due Diligence, 250+ checks per vendor; six-dimensional risk scoring
- Continuous EWS, Daily refresh; alerts within 4 hours of filing
- Litigation Feed, Real-time court data; NCLT/insolvency petitions flagged immediately
- Six-Dim Scoring, Legal, financial, operational, regulatory, reputational, structural risks
THE OUTCOME · AFTER
12 critical red flags in 60 days; zero fraud incidents post-deployment
In the first 60 days, AICA identified 12 critical red flags across the vendor base, including the director-level NCLT filing at the largest vendor. The company renegotiated terms, diversified suppliers, and avoided ₹27 crore in exposure. Fraud incidents dropped to zero (vs. 3 in the previous year). Vendor coverage reached 100%, eliminating blind spots. Audit response time fell from 1 week to 4 hours because all vendor data was standardized and current.
- Vendor coverage: 800/800 (100%)
- Critical red flags (60d): 12 identified; 3 NCLT/insolvency petitions caught in first week
- Fraud incidents: 3/yr → 0 post-deployment
- Fraud exposure prevented: ~₹27 Cr (prior year exposure)
- Audit response time: 1 week → 4 hours
- EWS refresh: Daily