EFY Times  
Thursday, February 11, 2016

 
GO
 
 
Retail In India Is Highly Competitive, Fragmented: Viveks Retail
 
Home >> Infotech >> Interviews
 
Retail In India Is Highly Competitive, Fragmented: Viveks Retail  
 
Taking most of the share from the market right now is key to survival as consumer electronics retailers need to survive on very thin margins.   
Rate this news:  (3 Votes)
Monday, July 09, 2012 Viveks Retail, the first organised retailer of India, got into organised retail of consumer electronics in 1995 and in the past 17 years, it has seen the consumer electronics industry grow to offer enormous options to buyers. Keeping up with the growing demand, the retailer recently repositioned itself from just a consumer durable (CD) retailer to a CDIT retailer. A Chennai-based company, it now has 14 showrooms in Chennai, nine showrooms in Bengaluru and 24 more showrooms in 16 other cities of Tamil Nadu and Karnataka. It also has six warehouses sprawling across 65,000 sq ft in cities like Chennai, Bengalauru, Madurai and Coimbatore. EFYTimes spoke to B A Kodandarama Setty, CMD, Vivek to know more about the retailer's business, the ongoing trends and major challenges in the consumer electronics retail.

consumer electronics, consumer durables, Viveks, Viveks Retail, organised retail, retailer, CDIT, Bengaluru, Chennai, Karnataka, Tamil nadu, after-sales service, marketing strategy, challanges, real estate, trained manpower, attrition, thin profit margins




You have been in the consumer electronics business for the past 47 years. When did you get into organised retail?

We have seen the market and competition since the time when there were no televisions, refrigerators or washing machines in the country. We started off in 1965 when only small consumer electronics items and kitchen appliances were available and other things came in much later. People had to get in television sets from neighbouring countries like Singapore or Dubai. Around 30 years ago, a duty of 320 per cent was levied on imported electronics goods. But today, all international brands are available just at the neighbouring retail shops. Most of the leading brands have manufacturing facilities here. Today we have more than than 100 refrigerators at our retail showroom. In those days, refrigerators were available in only two sizes - 165L and 285L. Now, there are options of 800L or even four-door refrigerators. Customers have many options available when it comes to model, size, colour, etc. Consumerism has undergone a change and we need to move along with the market and trends.

We got into organised retail in 1995. That time we felt that there was a need to change as the consumer was changing and even the market trends. Being a family business, it is difficult to expand and get funding but by April 1995, we started as a Limited company. We are the pioneers in organised retail, followed by Shoppers Stop.

You started way back in 1995 as an organised retailer for consumer electronics. Why have you been limited only to Tamil Nadu and Karnataka, even when other organised retailers like Croma, Vijay Sales and the likes came in much later but have presence across India?

Retail is detailed. Our country is called a nation of shopkeepers even today. Modern retail has not exceeded more than 7 per cent till date. Ninety three per cent business is still done by families. Retail is highly competitive and fragmented, so if you want to run a stable and profitable business in retail, you need to have size, scale and market share wherever you go. You need to see the potential and penetration. What is the point of having one or two stores in each city? We can have 47 stores in 47 cities but it is not going to work at all. When we have so much business here, we should capture here and then move step by step. That is how large retailers in the world have grown. They did not open 1,000 stores across cities in an year’s time. It took 50 to 60 years for them to spread out across places.

What is the approximate area covered in the 47 stores?

It will be over 2.5 lakh sq ft. On an average, a store area is 5,000 sq ft. We have showrooms which have area as large as 10,000 sq ft and others having an area of 3,000 sq ft.

In Chennai and Bengaluru we have stores covering 10,000, 8,000 and 7,000 sq. ft. An important thing in retail is the availability of real estate in the market. Also, the location should be suitable for retailing. The three most important things in retail are – location, location and location. If it is a wrong location, you can not survive.

What is the kind of turnover and profit margins you have?

Viveks has an annual turnover of Rs 427 crore for the year ending March 2012. Regarding profits, I can say we are profitable. We have grown nearly 20 per cent year-on-year in turnover in 2012. Also, our profits have increased nearly 25 per cent with respect to last year.

You are talking of profits in a scenario when the consumer electronics industry has not grown as per expectations?

Certainly we have had profits. So much inefficiency has been setting in retail, we need to correct it. How one stocks his inventory, takes care of the turnaround time, focus on growth and promotions. All these things are very important, so we are working on them. We are also adding new showrooms.

How has the overall retail business gotten affected owing to the recent rupee depreciation and market conditions?

The market conditions are totally different right now but new markets are also available. How much market share you are taking from the market is very important. How many new markets you are going to is also equally important. Some segments like LCD, LED, cellphones, laptops and computers are growing in double digits. Customers are upgrading their products and thus large-sized refrigerators and washing machines are being sold now.

Which category is the prime contributor to your business?

Refrigerators and washing machines contribute the most to our turnover. LCDs and Plasmas are next in line.

As for air conditioners, that is seasonal business for us. In three to four months' time, we get 80 per cent of our turnover from the AC segment. We see sales throughout the year, but the main contribution comes during Diwali and New Year.

How are you different from other organised retailers?

Our differentiating factor is that we have a very good service network like no one else in the country. We have our back-end operations and we provide entire range of solutions to our customers. We have nearly 400 people working in the service centre. We even offer an extended warranty to our customer beyond the guarantee period. We also give an Annual Maintenance Contract (AMC) to our customers as part of our after-sales service.

We provide one-stop solution to our customers as we are also the authorised service centres for the brands that we deal with.

What are the major challenges in consumer electronics retail?

Real estate affordability is one of the biggest challenges for organised retail. There is also a lack of trained manpower in the retail segment and another issue is retaining the employees. As there is a shortage of manpower, the attrition rate is also high in this industry. It is also a very highly competitive business. We need to survive in very thin margins.

Upasana Rajpal, EFYTIMES News Network


Print Email Post Comment 
(Total Views: 5249)
 
Share

 
 
Infotech News
   
Plasma Announces Strategic IoT Cloud Partnership With Texas Instruments
Gartner Positions Tableau As A Leader In Magic Quadrant For BI And Analytics Platforms
NIIT Technologies Launches Intelligent Automation For Business Operations
ASUS Creates Integrated Marketing Structure For India
5 Controversial Logo Changes Of Top Tech Startups
 
 
 
     
     
     
     
     
     
Most popular
 

Daily

Weekly

Indian Startups Shine At Asia Leaders’ Summit 2016
Team IIIT – B Wins Swiss Re 'My Personal Risk Advisor' Hackathon
EMC Announces New Innovation In Software Defined Storage With ECS2.2
Future Of Smart Manufacturing: 2016 Patent Analysis And Vendors' Deployment - Research And Markets
The Qprize – Make in India Contest by Qualcomm & DIPP
5 Brands That Created Buzz On Twitter In Past Week
5 Hidden Features In Truecaller
7 Things You Didn't Know You Could Do With iPhone
GE to Stop Making CFL Bulbs
Microsoft Acquires SwiftKey for Keyboard Apps
Payoye takes Mobile Payment to a New Level
Payoye Files Patent For QR Code Based Mobile Payment Technology
The 2015 Technovation Award Winners
Lenovo to Locally Manufacture Half of its Devices
Wipro enters into 7-year deal with RSA
Govt. plans $1.25 billion renewable energy fund
 
   

Overall

Features
5 Controversial Logo Changes Of Top Tech Startups
Follow this check-list while buying a second hand smartphone....
8 Fun Facts About Facebook
The social networking giant has just turned 12....
5 Hidden Features In Truecaller
The next generation digital phonebook app is full of hidden tricks and features....
5 Brands That Created Buzz On Twitter In Past Week
Weekly Twitter Advertiser Index lists the brands that generate most engagement with audience using the platform....
7 Things You Didn't Know You Could Do With iPhone
Here are 7 hidden feature of iPhone. ...
10 Interesting Interview Questions Asked In Top Tech Startups
Are you eying for the dream job in USA? Here are some interesting interview questions that you might get asked....
5 Biggest Smartphone Myths Busted
Did you know that overcharging of the device does not damage the battery?...
Top 5 Hidden Tricks For Your Android Smartphone
You can customize everything on your Android smartphone. ...
5 Key Qualities Of Facebook's Best Managers
The best managers help employees to progress and grow their skills. ...
7 Things Startup CEOs Are Better At Than Everyone Else
The great entrepreneurs are the best marketeer, salesman and leader. ...
6 Tips & Tricks That Every YouTube User Should Know
The popular video streaming site has tons of hidden features....
5 Hot Upcoming Smartphone Launches Of 2016
Here are top 5 smartphones that will be launched in coming months....
Top 5 Smartphones With Great Battery Life Under Rs 12000
Here are some budget smartphones that last for day long heavy usage!...
5 Things You Should Buy To Keep Your Gadgets Clean
Here are 5 things under Rs 800 that should be part of your gadget cleaning kit....
6 Hot Tech Careers For 2016
Tech jobs are amazing. They provide you flexibility and lots of opportunities. ...
 
  View All
Dialogue
 
Cisco Chairman keen on Manufacturing in India
EFY Times brings you some exclusive excerpts of an interview that was recently held with US-based, Cisco, executive chairman, John Chambers. ...
Chat-based bot developed by engineering graduates
Niki, developed by a group of four engineering graduates from Bangalore, now has 5,000 users, Niki - niki.ai/app - an Android (mobile) app is chat bas...
Meet Pranjal Saxena, India's 21 Year Old Electronics Wizard
Milan Ondhia of EFYTimes was in a forthright conversation with the 21 year old Pranjal Saxena from New Delhi; an aspirant at the WorldSkills meet, in ...
“We Offer Managed Document Solutions To CIO And IT Decision Makers”: Canon
Manufacturing within the country will surely reduce the cost of our devices, but manufacturing can begin only if there is the desired eco-system and w...
“One Day The End User Can Open Up A Used Battery, And Use What’s Inside As Barbecue Sauce”
Of course that is not something currently possible, but what B&B Batteries does have are some secret recipes for their very specialised battery design...
   
  View All
Videos
 
First Look: LG Optimus G
The phone sports a high-end display and comes powered by a powerful processor. ...
Create QR-Codes For Free
TEC-IT releases the freeware QR-Code Studio to provide a quick and convenient way of QR code creation for every application scenario....
DoT Secretary Shares Plans For Growth Of Telecom Sector
M.F. Farooqui has recently taken charge as secretary, Department of Telecom....
Hands-On: Sony Xperia Z
Xperia Z is Sony's first entrant model in the big-screen smartphone category. ...
Hands On: Videocon A30 Smartphone
Videocon, the consumer electronics company which is known for its refrigerators, washing machine and air-conditioner has unveiled its Android-based sm...
   
View All
   
 
IFA 2014
 
IFA 2014: LG Launches 34-Inches Curved Monitor
The company is yet to confirm price and availability of the device....
IFA 2014: Intel Launches First Core M Range Of Processors
This range of processors is tailor-made for 2-in-1 devices which include a tablet and a laptop....
MWC 2014: Tablet Lets People Feel Textures On Its Screen
Now feel what you see on your tablet, by way of ultrasonic waves....
MWC 2014: 4K Android Tablet Games To Kill Consoles, iPad
Tablet makers like Samsung want to beat the iPad by making 4K tabs. ...
MWC 2014: This Vodafone Backpack Helps Get Network In Disaster Situations
Two engineers of Vodafone New Zealand displayed the "mini" mobile network by Vodafone substructure in a backpack. ...
MWC 2014: Wilocity Chipset To Bring 'Lightening' Speed To Mobile Phones
Wilocity has developed a WiGig chipset for mobile phones that will bring lightning-fast wireless capability ...
MWC 2014: Samsung Introduces Octacore, Hexacore Chipsets
The Korean giant, Samsung unveiled two new octacore and hexacore chipsets at MWC 2014, in Barcelona. The company previously used Exynos 5 Octa 5410 ch...
   
View All
   
 
Events
 
19th Consumer Electronic Imaging Fair To Be Held On ...

View All
   
   
 
 

home archives contact us advertise with us
           
Magazines Portals Directories Events News Verticals Educational Institute  
Electronics for You
Open Source for You
Electronics Bazaar
electronicsforu.com
efytimes.com
opensourceforu.com
electronicsb2b.com
Electronics Annual Guide
EFY EXPO INDIA
EFY EXPO WEST
ELECTRONICS ROCKS
EFY Awards
OSIDAYS Expo
Electronics
Infotech
Linux & Open Source
Consumer Electronics
Science & Technology
BPO
EFY Techcenter

Educational Kits
Kitsnspares.com  
 
 
© Copyright 2016 EFY Enterprises Pvt. Ltd.
All rights reserved. Reproduction in whole or in part in any form or medium without written permission is prohibited.
Usage of the content from the web site is subject to Terms and Conditions