KOLKATA: Consumer electronic giants such as Samsung, LG, Sony and Panasonic plan to focus heavily on the business-to-business space to insulate their growth from economic slowdown and poor consumer spending.
While Samsung and Panasonic are setting up separate divisions for the B2B business, Sony is lining up major plans for the business. These companies plan to foray into several newer businesses like healthcare, professional display, automotive technology, education, security and energy solutions. "The professional business can become a saving grace in the current economic situation in India," says Sony India managing director Kenichiro Hibi. "While the B2B business too tends to slow down during a tough economic scenario like now, but the market is huge and hence we can expect faster growth rate than in consumer business," he said.
Hibi said Sony India has recently merged the B2B business, which used to work independently in India, with itself to give strategic focus. At present, Sony is present in a small way in segments like medical monitors, printers and projectors, but Hibi said he intends to grow it significantly.
The Rs 40,000 crore TV and home appliances industry is facing a tough time due to repetitive price hike led by an increase in commodity cost and weakening rupee, and consumers cutting down on aspirational spend. Last week, the companies increased prices by up to 10 per cent for the third time this year. While growth in the home appliances segment comprising washing machine, refrigerators, microwave oven and air conditioners is flat, the television segment is growing at around 8-10 per cent.
Panasonic India managing director Manish Sharma said the B2B business will help the company to expand margins and lead to better profitability. "The costs are lower as there are no advertisement budgets and distribution expense in this segment," Sharma said. Panasonic plans to foray into product segments like automotive technology, energy solutions, security and surveillance, and IT solutions based on cloud computing.
The country's largest consumer technology firm, Samsung, has integrated the B2B team across its various verticals. "The addressable market for the various product categories in B2B are expected to grow by 17-59 per cent CAGR for the next 4 years, making it an important growth segment for us," Samsung India senior VP (enterprise business) Sameer Garde said.