This homegrown television brand is leveraging affordability and high-quality factors to compete with brands like Sony, Samsung
While his father had been running a 35-year-old successful business, as a young and second-generation entrepreneur Arjun Bajaj had to dig deeper and work harder to identify the gaps in the system.
This led to the birth of a Made in India television brand — Shinco India — an affordable, wide-screen LED TV manufacturing brand, which was launched in 2018 under the parent company Videotex International, a leading ODM television company started by his father Vinay Bajaj.
These televisions, which are manufactured in the range of 24 inches and 65 inches and priced between Rs 5,400 and Rs 48,000, are manufactured in the company’s facility in Greater Noida, which has a commission capacity of a million units. However, it is currently processing 50 percent of the output.
At present, the company’s turnover is Rs 250 crore, but Arjun declined to reveal the turnover of the subsidiary.
SMBStory spoke to Arjun, the Founder of Shinco India, about his journey, and how he sees the coming times to pan out for the Indian television manufacturing industry.
Edited excerpts from the interview:
SMBStory (SMBS): What made you join your father’s business?
Arjun Bajaj (AB): I graduated from the University of Essex, post which I interned with Samsung in the marketing department. After having experienced a host of things, I recognised there was a lot of opportunity in my father’s business, and that’s when I decided to come back to India and be a part of the family business. Even though we had a complete setup for manufacturing televisions, I realised that we were only feeding the B2B sector. That is when I thought of entering into the B2C space, as we had the potential to do so.
This was also a time when the ecommerce platform, as well as online sales, were becoming popular in India. That is when I launched Daiwa, a brand selling television online. We started with ShopClues and then started selling on Amazon, Paytm, and Flipkart as well.
Selling online was a wise territory to venture into, but we realised that 80 percent of the television market was still offline. So, we took Daiwa offline completely, and launched Shinco India in 2018 to dominate the online space. Shinco India was launched on Amazon. We also launched the Shinco app which is available on the Google Play Store. This move has ensured that we are present on both the online, as well as offline space.
SMBS: What were the challenges you faced while setting up the business, and how did you solve them?
AB: Initially, there were a lot of challenges in terms of pricing. When we launched Daiwa offline, there were differences in the discounts which were being offered online and offline, so we decided to separate the two brands.
While setting up Shinco India’s business, there were trust issues that we had to combat. People were hesitant about paying online, as they were uncertain about the quality of the product that is going to land up at their doorstep.
But, these were minor challenges that we overcame by talking to the customers and sorting out their queries at every step of the way. Additionally, online sale has become extremely popular over the years, with more youth preferring to buying online. Factors such as ease in the financing and low-cost equated monthly installments (EMIs) have made everything easier.
SMBS: A lot of international television brands like SONY, Samsung, MI, and Micromax continue to dominate the Indian television market. What do the domestic manufacturers need to do along with the government to combat competition in this space?
AB: Off-lately, there has been a lot of competition from the international brands that entered the Indian market and have occupied a large market share. But what Indian manufacturers need to do now is (with the help of the government), invest in improving the infrastructure and making it better, so that we don't rely heavily on countries like China, which is a major exporter of a lot of components.
For instance, the TV screen which is called an open-cell, accounts for 65 percent of the total cost of the television. In India, we don’t have a single factory for this which requires an investment of almost Rs 60,000 crore. The government must encourage international giants to set up industries in India because right now, we are incurring more than 60 percent extra cost for importing these open-cells.
If things improve on this strata, then we will be in a better position to compete with international brands. We can source raw materials locally, not spend much on duty cost, and even look at exporting raw materials.
SMBS: How are you coping with the impact of coronavirus on the business?
AB: We are in touch with our vendors and customers on a daily basis. There is a lot of uncertainty right now.
We are not even sure if the economy will open up after May 3 when the lockdown ends. But, we are focussing on understanding and planning what steps we will have to take once the economy reopens. Right now, the biggest challenge is paying salaries.
A company like ours can still manage for two or three months, but what happens after that? Moreover, small businesses are in even dire situations for whom paying salaries right now is very difficult.
SMBS: How are the Chinese entrepreneurs dealing with the COVID-19 impact, and what steps have they taken to revive the economy?
AB: We are speaking to people in China to understand how they are reviving themselves from the consequences of the pandemic. It is very surprising to see how quickly the Chinese have managed to shift to the manufacturing of essential goods like masks, hand sanitisers, ventilators, medical supplies, and equipment. But this step will definitely help them revive their manufacturing sector.
Edited by Suman Singh