Consumer durables retailers are reporting brisk sales owing to healthy summer sales and consumer finance companies renewing their offerings. Retailers in the category are also moving ahead with private labels to improve on the margins.
“The hot summer period has helped contribute growth in categories like refrigerators, air conditioners. The biggest growth has come from air conditioners. Other white goods like LCD and LED televisions are also posting double digit growth,” Mr B.A. Kondadarama Setty, Chairman and Managing Director, Vivek's Ltd, said.
The Chennai-based durables retailer has seen its sales pendulum swing towards a positive growth. While Bajaj Finance and Shriram Finance offer consumer finance, the company by itself is also looking to attract footfalls with various schemes like extended warranty and after sales network. It may be recalled that consumer finance companies had opted out of durables financing following the economic downturn.
According to Mr Nitish Tipnis, President, eZone, the durable arm of Future Group, said, “We are not ready to accept the growth we had last year. We want more and we are working towards improving it through various modes. Energy-efficient products and consumer finance have helped boost consumption.”
He said at least 15 per cent sales is attributed to consumer finance. “Consumer finance is a huge pie. “We have our own captive Future Money on which we have capitalised,” Mr Tipnis said, adding that modern trade business will see a spike in the next couple of years.
Besides, it is also focussing on growing its own private label brand. “Our private brand Koryo is doing brisk business. Currently, our entire private brand contributes about 12-13 per cent to the total turnover. We are looking to scale it up in a big way.” eZone has 62 stores pan-India and it is looking to add 22 more stores this fiscal.
Reliance Digital President and Chief Executive, Mr Ajay Baijal, says with consumers gaining confidence in the company, it is looking to scale up its business. “We are seeing high double digit same-store growth. While air conditioners account for the largest portion of business, LCD panels too are witnessing a sales surge.”
On the company's strategy on private labels, he said, “Private label is a game of scale. It is not easy to play the game and companies face big risk as compared to manufacturers. We are examining opportunity in certain small appliances and accessories.”
Source : www,hindu.com
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