What are your plans for this season?
With summer setting in early this year, we expect a good growth in AC and refrigerator sales this year. Stable macro economic factors coupled with our new product range in both categories will act as growth drivers for these segments. As a result, we have expanded production capacity for ACs, introduced an entirely new portfolio of star rated energy-efficient refrigerator and AC models and launched new marketing campaigns for the same. This year, we have unveiled 26 new models across split and window AC categories while in refrigerators, we have launched the frrrunch range, which will comprise of 49 frost free and 19 direct cool refrigerators.
Besides launching new products, how are you ramping up your production levels this year?
To meet the growing demand from the market, we have begun manufacturing split ACs at our Sriperumbudur facility in November 2009 and in the Noida facility in February this year. We now have a total production capacity of 1.2 million units per annum for split air conditioners in India. This capacity expansion has been possible with the investment of USD10 million. Sales volumes are also expected to double to around 1 million units this summer.
Any specific growth targets that you can reveal for now?
Yes absolutely. In ACs, we plan to double sales volumes in 2010 this year to one million units, hence garnering a market share of over 30%. In refrigerators, the market share target has been set at 26% by end of 2010. Overall we are looking at a 40% jump in sales volume of our refrigerators and ACs in the April-June quarter.
How is your pricing strategy going to work out in the current scenario?
The widening of tax slabs may have put more money in the hands of consumers, giving a fillip to demand for consumer durable products; however rising input costs have also affected prices. While most of the negative impact of the steep hike in input costs has been absorbed by us, it has necessitated a marginal increase in prices of our products. Thus we have marginally hiked prices of refrigerators by 3% and for ACs by 4-5% recently.
What innovations are you bringing in your products?
At Samsung, our endeavor is to introduce products that meet the needs of Indian consumers and we do so by developing products based on insights drawn from Indian consumers. A recent example would be the just launched Samsung S series ACs that incorporate the world’s first S-UTRTM compressor; designed to provide stable operation during voltage fluctuations or the highest temperature. With erratic and unstable electrical conditions in India that lead to constant breakdown of ACs, Samsung has enhanced the motor of the compressor to provide reliable performance in extremely low voltages or at 54 degrees Celsius without an external stabilizer. In fact, the S Series ACs are stabilizer free, thus saving space as well. So now the user can have fresh, cool air in any condition. Similarly, the 2010 Refrigerators range under the name ‘Frrrunch’ is designed to be a perfect combination of convenience and performance as well as understated elegance. Packing the world’s most advanced cooling technology and conveniences that make living a delight, the new Frrrunch refrigerators have the advantage of an advanced Moisture Control Technology that ensures that fruits and vegetables remain naturally fresh and delightfully crunchy.
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Source : IIPM Editorial, 2010.
An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).
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