Aiming to assist local handset makers pick up lost ground, the government has taken various actins in the recent times, such as easing rules for domestic production and increasing customs tax on mobile handsets. The efforts, on the other hand, have brought a bit of cheer for the stressed local makers, as Chinese companies (now a leading force) have started assembling/manufacturing almost 100% of their goods being traded in the nation.
The collective share of the market for China-located companies particularly Vivo, Xiaomi, OPPO, Lenovo, and Huawei (Honor) in India pegs at 53% in 2017, claimed IDC (International Data Corporation). As per Counterpoint Research, the mutual share of the market for 4 top Indian companies Lava, Micromax, Karbonn, and Intex was a just 12.5% in 2017. Local companies do take cognizance of the efforts by the government, but realize the power of the Chinese companies when it comes to offering excellent user-experience at reasonable prices, mass-scale indigenous production, and robust distribution networks.
“China-located companies are making smartphones that give improved experience to the Indian users that is not being offered by the local makers. Most of the Chinese merchants are now locally sourcing and manufacturing parts so they are not impacted by alterations in the policy,” Senior Market Analyst at IDC India, Jaipal Singh, claimed to the media in an interview.
Chinese companies are very violent when it comes to expansion of the market. Supported by leading innovation, they know the market when it comes to distribution network, product line-up, and presence in both offline and online sections. Associate Director at Counterpoint, Tarun Pathak, thinks that the problems which domestic companies are encountering have more to do with their target users than anything else.
“While Chinese companies are capable of attracting new consumers all over different price ranges, the Indian companies have hugely been limited to the sub-Rs 6,000 cost segment. Above all this, they are deeply outspent by Chinese companies in terms of advertising and marketing,” Pathak claimed to the media. Almost 4-5 years ago, when handset companies such as HTC, Sony, and Samsung were dominating the roost, distributors of the local mobile accessories recognized the immense chance and rolled out reasonably priced handsets.
In the period from 2013 to 2014, the domestic companies quickly got grip and took pleasure of 40–45% share of the market till the time Chinese companies made an entry in the Indian market and the rest is the history.
Morgan has been in the position of the business analyst for almost a decade and with such expertise, he is one of the best expert hands with us. His profound understanding of the trade, commerce, and business trends makes him a reliable contributor to blamfluie.com.