- Manish Chauhan started working in the consumer electronics space in 2004
- Today he owns three Sony brand shops and one multi-brand outlet in premium malls
Manish Chauhan, owner, Sony Brand Shops, in an exclusive conversation with EFY Group’s Rajeev Kumar, shed light on his journey of how he grew to be an owner of three Sony brand shops from being a consumer electronics retail manager. He also spoke about the consumer electronics industry in India.
“I would say that the consumer electronics market has just started spreading its wings in India. The times ahead, are exciting, challenging, and of course rewarding!,” shared Manish.
He added, “Margins getting hits because of digital payments is not a challenge for the business. If we do business in cash payments then we need to go to the bank and deposit the money. That also costs us three days. Now it is up to a retailer to choose petty margins or save time!”
Here are some interesting excerpts from this conversation.
ACE- When did you start this business? What prompted you to start this business?
Manish – We started this business in 2009 with one Sony brand shop. Now we operate three Sony centers and one multi-brand gadget showroom. Out of these four, two Sony centers are located in Faridabad, one in Gurugram and the multi-brand showroom is also in Ambience Mall Gurugram.
I choose this business because of a lot of reasons. When I started as a retail manager in 2004, consumer electronics retail was largely dependent on traditional trade channels. There was no competition from large format stores. Online sales were negligible as well.
I was determined to own-brand shops and I took the risk. Today I am proud to operate three Sony brand shops and one multi-brand shop. Two out of these are located in Ambience Mall in Gurugram and I am proud of that.
ACE- What’s your vision for your business and India’s ACE industry?
Manish- The vision of Deepika Enterprises is to develop premium customer services. Actually that is why we choose to deal with Sony Exclusive showrooms. The company is known for its premium quality products and services.
I think service is critical for competition and survival in the market. Premium service is the biggest weapon to compete against online sales channels. Also, I always try to connect with consumers directly. If any of our customers face a challenge related to delivery or installation, I personally look after that!
The scope of the consumer electronics industry is huge in India. The majority of India’s population is young and this young generation is keen to use new products and technology. Whether it is smart TVs, smartphones, Playstations or any other product range, the young generation wants to give it a try.
ACE – How do you see India’s ACE (Appliances and Consumer Electronics) industry growing from here?
Manish – India’s ACE industry is growing at a fast pace. Consumers who used to generally invest in CRT TVs, single door refrigerators and semi-automatic washing machines are now investing in LED TVs, automatic washing machines and technologically superior products.
I would say that the consumer electronics market has just started spreading its wings in India. The times ahead, are exciting, challenging, and of course rewarding!
ACE – What are your expansion plans in the near future?
Manish – My core business is consumer electronics. One thing is very clear, I will continue to work with Sony India. Yes, there’s a trend of smart gadgets. In fact, many of our existing consumers used to call us and asked where they should buy gadgets from. So, we decided to expand into smart gadgets showroom. Now, we operate in the entire range of Sony’s consumer electronics and gadgets from other brands.
ACE – There were around seven brand shops in Ambience mall Gurugram in 2011-12 and they were closing business. How have you survived against large format retailers? Any strategy behind that?
Manish – Ambience Mall is one of the most prime locations for sure. The consumer expects premium service from the retailers located in this mall. I think the ones who shut shop here were bad managers. It is simple, you have to be on your toes when it comes to service. This is where we excelled. Additionally, I have developed a habit of keeping in touch with existing clients.
The only strategy that worked for me is the service quality we offer. We do not compromise on that and we will never ever compromise in the future as well!
ACE- Why multi-brand showroom and not one more brand shop?
Manish – Almost 90 percent of my consumer electronics business is based on the exclusive brand shop business model. This is doing absolutely fine. We forayed into gadgets business as it is the need of the hour. It also keeps me informed about the recent developments in the consumer electronics industry.
ACE – How’s your business doing in this FY? There’s a lot of news of growth from the ACE sector—are you witnessing it too, in your business?
Manish- We are doing better in LED TV and Play Station product categories. Smart TVs are in trend as consumers are able to get more features than in these when compared to normal TVs. They prefer smart feature like smart sharing, built-in social media platforms in TVs and built-in video streaming platforms like Youtube, Amazon, Netflix, and SONY Liv.
Playstation is one of the major attraction points for Indian youth. As a matter of fact, this is a very strong and focussed product category in our line of business. We are able to do better because being an exclusive showroom, we have multiple product displays and Play Stations put up on demo.
ACE – Any new strategy implemented by your team in this FY that’s resulting in growth?
Manish- We are dealing with one of the top brands in the industry. Whatever we follow here is exceptional. I say so because we never miss on wishing our customers on special occasions. I guess that is one strategy that is working for us quite well.
Occasional calling, festival wishes, offers communication helps us in increasing footfall at our stores. This footfall includes our existing consumers and the once that are referred by them!
ACE – Any product segments or brands that are affecting your business positively or negatively?
Manish – Yes, I think Chinese players are denting some of our business. Their pricing is very aggressive when it comes to comparison with established brands. However, a lot of consumers have started understanding that a lot of Chinese players can compete with established brands when it comes to service. I think there is still a lot of time left for bigger brands to consider their strategies. In the long run, it is service plus price that matters.
ACE – What’s your strategy for developing your team to guide and sell the right product to your customers?
Manish- This is a crucial part of any business. How a business uses its teams decides the outcome. While a lot of retail professionals tend to sell consumer electronics as per their incentive plans, we pitch products according to a consumer’s need. This has been the strategy that has helped us stay afloat.
Regular product training by Sony India is of great help too. Instructions for people working at these three brands shops include understanding a consumer’s needs, pitching the right products, showing live demos and assuring premium service!
ACE – What’s your strategy for products that get discontinued or obsolete? Why so much focus on affordable consumer electronics brands?
Manish- I think technology is the biggest parameter when it comes to the growth of the consumer electronics segment. Product ranges get refreshed every now and then. However, It has not happened once that we got stuck with an inventory.
Moreover, we have the assurance from Sony India that if something like that happens, the company will drive offers to help us out. You need to plan carefully, that’s all it needs.
ACE – Do you indulge in B2B (institutional) sales also? If yes, how much of that is it, a percentage of your overall revenue?
Manish- Yes, We are doing B2B business and its contribution to our business is around 10 to 15 per cent. Clients are reaching out to us through online and Just dial for it.
ACE – How are you handling the challenges created by Online portals like Amazon and Flipkart?
Manish- Yes, there are challenges from online sales channel but after Govt’s policy changes, these challenges these got reduced. Actually, we now, at a lot of times, are able to offer products cheaper than the online channel.
Small product categories like smartphones and headphones sell more from online sales channels. We are able to tackle this with our wide range of product display that helps consumers in touching and feeling (Experience) the products.
ACE – Are you accepting digital payments from customers through Debit Cards, Credit Cards, PayTM, etc? Are you seeing an increase in the same?
Manish- Yes We are accepting almost all types of digital payments and these are increasing. Earlier these were around 65 to 70 per cent but now it is around 95 per cent. Now digital payments are also getting support from govt and banks in the form of cashback and instant discounts through digital payment.
EMI options are the biggest support that digital payments have facilitated. These help upscale consumer budgets and help us sell the product in the higher ticket size categories. Though we also have options for paper finance like Bajaj Finserv and HDB finance but we are still doing around 50 to 60 per cent digital finance.
ACE- What’s your take on the erosion of margins because of commissions on cards, payment gateways, etc on digital payments? How do you manage this challenge?
Manish- I think that is not a challenge for the business. If we do business in cash payments then we need to go to the bank and deposit the money. That also costs us three days. Now it is up to a retailer to choose petty margins or save time!