Mobile-handset Makers Rejoice! #5 Prospects Once Apple Begins Making in India
'Local factories for components can work wonders such that companies don't need to depend on China for imports.'
Puneet Narang, the man who has played key roles in distribution, consulting and operations in the UK as well as in India for the last 19 years, believes local components infrastructure in the country could change the face of telecom brands in India.
In the wake of Apple looking to locally manufacture its products, Narang says it could be to a step in the right direction to improve local market.
A distribution veteran, Narang has played the role of Vice-President of Mobile distribution at Brightstar, the distributor for Apple devices in India.
Before Brightstar, Narang headed the national channel sales & marketing division for iPhone on behalf of Redington India. He has also held positions for sales growth for Blackberry Devices and accessories in North India and iPhone primary/secondary and tertiary sales earlier.
Speaking to Entrepreneur, the graduate from Cass Business School, said local factories for components can work wonders such that companies don’t need to depend on China for imports.
From an industry point of view, Narang lists #5 prospects that will arise if Apple manufactures in India.
Parallel import will stall
Definitely, there are import duties that push the prices higher. Overall prices will come down.
In 2011, when Apple started open distribution before that none of the tech products used to get imported. There is still a substantial portion of products that get imported via a parallel channel.
If our market starts manufacturing, that parallel import would completely stall.
The timely availability is a big issue here for direct buyers. When you order for a phone model, it taken 3-4 weeks for a product to arrive from China. If it is local manufacturing, it will be a big help for traders and retailers.
Time to market
Right now, if we try to plan a promotion on a particular model, planning has to be done before hand and things may change in the meanwhile. The time to market will definitely cut down.
If we consider smartphones in the range of Rs 20,000+, Apple is no where. By volumes, Apple would be less than 2-3 percent. But when it comes to 30,000+ category, Apple’s share can easily be counted as 80 percent in metros, nothing else sells. No one buys anything else says Narang.
In the last 10 months, the Chinese companies have taken the market by storm and have given a good competition to Apple. Indian brands such as Micromax and Lava are struggling despite being great brands.
Once Apple starts local manufacturing, a level-playing field could be created which will lead to price adjustments.
Building own channel
My personal view is Apple wants to build its own channel, it’s own stores. In order to establish their own channel, Apple will have to do a lot of clean up in the rest of the channels. That can only be good for the market.