Sunday 24 May 2015

Lloyd says no to e-commerce platform.

While consumer durables companies take to the e-commerce platform for better sales, BSE-listed Lloyd Electric & Engineering is swimming against the tide.

Aiming at an 11 per cent market share, it's making sure its products are not on e-commerce websites, even as Korean competitors Samsung and LG are pushing their products through e-commerce more aggressively.

Lloyd is not in favour of online sales via platforms like Flipkart or Snapdeal because it is affecting dealers' business, it says. The company has a pan-India network of a little over 7,000 dealers, with 300 service centres.

Lloyd aims to sell around 400,000 units of home air conditioners this summer, to corner about 11 per cent share in the domestic AC market. The Indian AC market is limited to 3.75 million in annual sales, a penetration rate of three per cent.

Last year, room AC sales grew 10 per cent in volume terms. The price of power-efficient five-star ACs is one consideration for low adoption.

"We are not chasing market share. Our main focus is on quality and customer delight. E-commerce players are burning cash with heavy discounts. E-commerce players have made major inroads into the country's retailing business by offering unprecedented discounts, which impacted sales of brick-and-mortar retailers, even though they are also making huge losses. We are not allowing them to offer any discount on any Lloyd products. We are in discussion with Flipkart to resolve this issue," said Nipun Singhal, director.

Lloyds has also filed a case against Snapdeal; Singhal said he wouldn't comment on this, as the matter was in court. "We do not want our dealer network to suffer due to online sales," he said.

An email to Snapdeal did not elicit a response.

However, companies that used to discourage consumers from buying online, saying installation and after-sales services would be affected, are changing their stand. "As e-commerce is dominated by the metros and tier-I towns, and is growing at a rapid rate, companies can't afford staying away from it. The festive season is a good time to start afresh," said an executive at a top consumer durables maker.

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