The retail boom has had its resonance in the home appliance segment of the country. Over the years, this segment has grown to include new, innovative product lines and also a couple of new players who have managed to keep consumer aspirations in mind. The growing consumerism and the rise in the disposable income of Indian consumers have further steered this growth story to new heights.
The Indian home appliance industry is characterised by the availability of skilled manufacturing and R&D engineers. Companies with availability of low cost labour are able to roll out new models in every 6-8 months. The manufacturing units are also provided with special tax incentives in major industrial cluster like Noida and Pune.
Global players outshine domestic companies
The home appliance market in India is currently dominated by foreign brands. Korean brands, followed by American brands like Whirlpool, have replaced once-popular Indian names like Onida, BPL, Voltas, Kelvinator and Godrej as brand leaders.
The problem with Indian appliances brands seems to be the perception that they have not delivered innovative products. Korean brands, in contrast, performed much better on this score while offering value-for-money products, and this has earned them the confidence of Indian consumers. For 3 consecutive years, India has ranked first out of 30 emerging retail markets in the world's most attractive investment country. This propelled the Chinese home appliance enterprises to develop markets in India and the latter soon became an important trading partner for it.
Furthermore, Indian appliance producers have failed to focus on harnessing the power of their brands by targeting smaller town markets and lower price points. Small town customers today are equally bitten by the consumerism bug and global players have successfully banked on this opportunity to drive penetration of their products into these untapped areas.
New players join the bandwagon
Sensing the immense opportunities that 5,200 crore segment is throwing up, many global players are now heading towards the Indian market with their own treat for their Indian consumers. The latest entrant to announce its entry into the domestic home appliances is the electrical equipment maker Havells. The company is expected to clock sales of Rs.500 crore from the segment in the next four years. The company is investing up to Rs.80 crore on marketing, research and development of its small appliances range over the next two to three years. “We we see a huge business opportunity in this fast growing domestic home appliance market,'' Havells India Joint Managing Director Anil Gupta said in a company statement. “We will outsource 70% of manufacturing to local vendors and the rest to our partners in China, where our design centre will be responsible for developing the products,” he further added.
The home appliance segment is at an all time high. And India being hailed as a strategic market by major home appliance brands, there is a lot of promises and future scope for this segment to grow further.