KATHMANDU, DECEMBER 24
Godrej Appliances, the first Indian conglomerate to manufacture refrigerators, was not unaffected by the COVID-19 pandemic. Yet, it has been marching ahead in the home appliances "industry amidst the pandemic by introducing relevant technology, like the medical refrigerator to store vaccines.
Salam Sonamani Singh, associate GM and head of exports at Godrej Appliances, who was recently in Kathmandu, shared with Bijay Laxmi Duwal of The Himalayan Times the challenges and market strategies ahead, and new Godrej products.
The outbreak of COVID-19 pandemic hit all businesses the world over. To what extent has it affected Godrej's business?
There was an impact for us because of the lockdown in the first wave of the COV- ID-19 pandemic. In some parts of the world like East Africa and West Africa, our market didn't suffer much.
But in India, Nepal and developed countries like the US and the UK, there was complete lockdown and some of our companies there were shut down for a couple of months. There was an immediate negative impact because of the lockdown in March, April - the main season to manufacture appliances.
It was an unprecedented and surprising outbreak. Our companies were not prepared.
Initially there was a big challenge. Some raw materials used to be imported from foreign countries, but because of restrictions, the supply chain was broken.
There was a negative impact on the cost of the imported items. With that, the price of commodities like copper, resin also increased.
What is your observation of the Nepali market of Godrej amid the pandemic?
Localisation ratio of raw materials for our manufacturing with self-reliance or 'Atmanirvar' increased during the lockdown - it's a big opportunity and advantage for Godrej manufacturing companies in India. In many categories we are independent now. The COVID-19 also brought lots of changes in lifestyle - we started working from home, children started taking classes online, young couples who don't have time to cook prefer to use a microwave oven. Although there was an immediate impact, the appliances were not much affected.
The requirement of a microwave oven has gone up, the sales of washing machines, dishwashers, and refrigerators have gone up. So, there was a spike in demand for home appliances during the pandemic.
Despite the challenges in lockdown, we have developed the e-platform for our dealers and distributors along with the professional team of CG as well as training and support from Godrej. So, Godrej has done well even during the pandemic. It had good sales growth in the pandemic of last financial year.
This year we are expecting around 10 per cent revenue growth despite the lockdown in May and June.
How has Godrej managed to sustain in Nepal amid the pandemic?
In Nepal specifically, logistic arrangement for e-commerce is a big challenge because so far we have dealers and sub-dealers only. We didn't have a logistic infrastructure for e-commerce in Nepal and so, changing the supply chain, delivering the goods on e-platform was the main challenge. That's why we helped develop online platform sales for our dealers in Nepal. Online you can only see pictures and some details of appliances, but customers who want to buy a refrigerator want to see and feel it. So, acceptability of e-commerce is still a big problem here. Lots of promotions were done on social media. Sales demonstration was done through video call, after sales service was also done on video call.
So, the new technology helped us in overcoming and sustaining the challenges. We have also been maintaining proper safety protocols in the showroom arranging for social distancing, and sanitising.
What are the major brand categories that have remained active since the outbreak of COVID-19 in Nepal?
Dishwashers, microwave ovens and front load washing machines are the major products launched in home appliances here. People are saying that COVID-19 is going to be here with different variants and we are hearing about vaccine booster everywhere. Vaccine requires an optimum temperature to have an effective result. Therefore, there will be a big demand for medical refrigerators or cold storage, which can keep the vaccine in that optimum temperature.
So, Godrej is coming up with medical refrigerator.
We have already started talking about our plan with the government of Nepal and non-governmental organisations.
Godrej has already launched its medical refrigerator for vaccine storage and the blood bank this year.
Tell us about the market share of Godrej Business Company in Nepal before and after the lockdown?
Before lockdown, we had about 12 per cent of market share in our main product category - refrigerator. But since the pandemic last year, with our initiatives, now our market share would be around 15 per cent.
The demand or market size of refrigerators is much bigger than the other product categories. So, our reflexive product for business and revenue growth will still be refrigerator among our main categories. There are lots of frost-free and direct cool refrigerators. With the change in lifestyle, we are trying to lead the market with new products in the home appliance category in 2022.
What are the USPs of Godrej appliances?
Every Godrej appliance has its own USPs. If I have to mention one, a medical refrigerator can maintain the optimum temperature required for the vaccine which is four to eight degrees for 11 days without any electric power supply. R290 refrigerator is the greenest product, which has zero ozone depletion potential or it also has zero global warming potential.
What plans does Godrej have to update its product portfolio in Nepal? What strategies is it deploying to penetrate the market further?
The range of new products is added in the refrigerator, washing machine, and dishwasher.
We have lined up deep freezers; we will be lining up air-coolers. We will be working on launching green air-conditioners in Nepal.
We are working for expansion of our channel, so we would like to increase our reach and distribution channel or retail channel. We are also working on a specific scheme. With experts from CG group and the kind of service network we have, we will be working on how to strengthen and how to ensure on improving our after sales service within 24 hours of customers' complaints.
What is your evaluation of the partnership between Godrej and CG EOL? What are both companies doing to further strengthen this association?
Godrej is a 125 years old company. It's a household brand name in India. I am happy to say that every one in three people in India are using some of the Godrej products. Secondly, both companies have a similar vision - for CG, it is touching life easily, and Godrej is in every house and in every office.
The vision is very clear that we both want to touch as many lives as possible with our world class products and services. So, in the ethical part, both companies believe in the right practices and ethical business practices that also help in building trust between us. So, we are very happy to have an able partner like CG group in Nepal, the first conglomerate company in the country.
A version of this article appears in the print on December 25, 2021, of The Himalayan Times.