EFY Times  
Saturday, April 25, 2015

 
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: 4208)
 
Share

 
 
Infotech News
   
Translation Cloud Now Provides Video Captioning And Subtitling Services
Storage Switzerland Test Drive Demonstrates Transporter’s Private Cloud Storage Efficiency Over Public Cloud Solutions Such As Dropbox
Shipment Of The Much-Awaited Apple Watch begins
The Meeco Group Completes Installation Of 20KW Solar Project In Gurgaon
ACME Signs PPA For 30MW Solar Project With Uttar Pradesh
 
 
 
     
     
     
     
     
     
Most popular
 

Daily

Call For Entries Opens For Best Of CES Asia Awards Program Presented By ZOL
Linksys Launches The WRT1200AC - Best In Class Wireless AC1200 Router
Samsung Expands Mobile Virtual Reality Category With Gear VR Innovator Edition For Galaxy S 6 In The U.S.
AEG Power Solutions Launches MoniUPS Remote Monitoring For Power Systems
AT&T Access More Card From Citi Featuring A New Exclusive Smartphone Offer Now Available
AEG Power Solutions Chosen By Emmeti For UPS And Remote Monitoring
Universal Stylus Initiative Launched To Create A Specification For An Active Stylus
3M Announces First-Quarter Results; Company Posts Sales Of $7.6 Billion And Earnings Of $1.85 Per Share
Infor Invests In Enhancing Learning Management Tools
Pulsic’s Animate Adopted By Ricoh Electronic Devices For Power Management IC Layout
 
   

Weekly

Updated Panasonic Toughpad 4K Tablet Now Available
Updated Panasonic Toughpad 4K Tablet Now Available
3 Successes And 3 Failures Of Microsoft
Panasonic Enhances Toughpad 4K Tablet For Improved Productivity In Creative, Technical Fields
Canon Targets Young Talent; Takes Photography To School Kids
NxtGen Outperforms Amazon Web Services And Rackspace On price-Performance Metrics For Cloud Services
WhatsApp Undergoes Facelift With Material Design And Better Layout
Electronics Policy 2014-2019; Gujrat To Become A Leading ESDM Destination
Top 7 Smartphones With Long-Lasting Battery
5 Most Infamous Hackers Of All Time
India Ranked Second In Cyber Crimes Through Social Media
8 Best Alternatives To Bootstrap
Top 10 Frequently Asked SQL Query Interview Questions
Wipro Sees Govt Of India’s Policy On Open Source Software Opening Up Major Opportunities
Whatsapp To Become Largest Communication Service; Crosses 800 Million Users
Top 6 Octa-Core Android Phones Under Rs 10,000/-
10 Must Have Google Chrome Apps
 
   

Overall

Features
7 Things To Do After Buying New iPhone
Bought a new iPhone? Here are 7 things you need to do right away...
8 Gadgets To Make Your Smartphone Even Smarter!
Check out these 8 cool gadgets that will make your smartphone smarter...
10 Must Have Google Chrome Apps
Install these Chrome extension apps to boost your work productivity...
Top 6 Octa-Core Android Phones Under Rs 10,000/-
Here is the list of best 6 super-fast Android phones you can buy under Rs 10,000/-...
6 Qualities That Can Help You Achieve Happiness
Here are 6 qualities that you can incorporate in life to find the greater happiness....
Top 10 Frequently Asked SQL Query Interview Questions
Here are 10 frequently asked SQL interview questions and answers that can help you crack the interview....
8 Best Alternatives To Bootstrap
Boostrap is used by many web developers out there. If you are looking for some innovative alternative to Bootstrap. Here is the list of 8 best options...
8 Tech Companies You Didn't Know You Use Everyday!
You may not have heard the names of following tech companies but, you use their product and services in daily life through your favorite app....
Top 8 PHP Libraries For Developers
Here is the list of best PHP libraries for web developers and programmers...
3 Successes And 3 Failures Of Microsoft
Microsoft has seen many triumphs and failures. Here are top 3 successes and 3 failures in company's 40 year journey....
Top 8 Most Expensive Smartphones In India
Ever wondered about the most expensive smartphones available in India? Here is the list of luxury smartphones...
5 Most Infamous Hackers Of All Time
Here are 5 most well-known hackers and what they've become infamous for in the hacker community...
Top 7 Smartphones With Long-Lasting Battery
Here is the list of 7 best smartphones under Rs 20,000/- which come with minimum 3000 mAh battery...
7 Mistakes That Can Kill Your Startup
Here are 7 startup mistakes that needs to be avoided to survive past the initial roadblocks....
5 Undiscovered Features Of Google Drive
Google Drive offers a number of tools to help you be more productive. Try these five for the biggest boost. ...
 
  View All
Dialogue
 
“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...
We Wish To Procure All The LED Components Within India: Avni Energy
G. Gururaja, director, Avni Energy Solutions Pvt Ltd, shares his views about the expanding LED industry in the Indian market and the company's plans i...
We Have Registered 50 Per Cent Growth In The Last Two Years: Arihant Lighting
Apart from LEDs, Arihant is associated with the promotion of renewable energy in India and therefore, manufactures various energy saving products....
“Elcom Plans To Build A New State Of The Art R&D And Manufacturing Unit In Maharashtra", Reveals MD Girish V Vaze
Starting out as a small business to cater to the industry’s need for import substitutes, Elcom International has grown to be a leader in the field of ...
Delta Magnets Ltd To Enter Into JV With Chinese Company!
The company had partnered with TDK Japan for technology transfer to manufacture magnets in India....
   
  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 2015 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