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Eveready to sell home appliances; will take e-commerce route to gain market share

"Considering that 30% of country's appliances now get sold through the e-commerce platform, the thrust would be on it with disproportionate spending on channels like Flipkart and all," Amritanshu Khaitan, managing director, Eveready Industries said.

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Battery maker Eveready Industries has announced plans of entering into the kitchen appliances space.

The company, to make good of its late entry into the already overcrowded home appliance sector, will focus mainly on the e-commerce platform which will also help it save on costly distribution costs.

"Considering that 30% of country's appliances now get sold through the e-commerce platform, the thrust would be on it with disproportionate spending on channels like Flipkart and all," Amritanshu Khaitan, managing director, Eveready Industries said.

Some models out of its 60-odd appliance product range starting from mixer grinders to rice cookers would be developed exclusively for the specific e-commerce platforms.

"Not all big brands in the brown-goods space are on the e-commerce platform partly due to channel conflict. But we plan to be there in a big way," he said.

Offline, Eveready plans to start with 76 service centres across India and the number would be raised to 150 by September.

Despite being a late entrant into the fragmented and overcrowded space, Eveready hopes to garner a market share of 5% within the next three years.

"The home appliances market, valued at Rs 15,000 crore, is growing at a healthy rate of 10% even at a time when some segments of the market are not growing at a high rate due to economic conditions. So, there's enough opportunity for us," Amritanshu said.

While there is pressure to sell cheap on e-commerce channels, an operating margin of 10-12% in the appliance category would ensure profitability.

"Even after considering discounts being offered on online sales, savings in terms of lower distribution cost take care of that."

The venture is asset light with the products being entirely outsourced, of which 65% would come from Chinese suppliers.

"We would go national with the product range with a media campaign by around Diwali."

Amritanshu, who heads Eveready, as well as Aditya, his uncle, who heads McLeod Russel, denied reports that Eveready's branded tea business might be transferred to McLeod, world's largest tea plantation company.

"As a group, we are going to change our thought process, coming up with various ideas about how to connect with consumers. Packet tea being a consumer business, has a great future. It needs proper investment and focus, and we would like to be a major player in the packet tea business," Aditya Khaitan, managing director, McLeod Russel, said.

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