Handset retailers are expanding their product lines to include consumer electronics items such as baby monitors, portable handheld washing machines and portable parking monitors among others as part of a strategy to derisk their business against supply chain concerns as smartphones continue to suffer from component shortages.
“Handset retailers are diversifying beyond phones and are selling IoT (Internet of Things) products including smartbulbs and coffee machines. They have to run shops and pay salaries and mobile phones,” said Arvinder Khurana, president of All India Mobile Retailers Association (AIMRA).
Some of these smaller retailers are buying products from online channels and then selling them in their stores.
Neil Shah, research analyst and partner at Counterpoint Research, says this diversification is “demand driven” and gives handset retailers a chance to diversify their business when there is a component shortage issue for their main product – smartphones.
The global semiconductor shortage has hurt electronics, smartphones and auto industry and, according to experts, could continue until 2022, leading to increase in prices and supply chain shortages.
While overall handset supplies are set to take a hit, industry insiders expect offline stores to be hit harder than their online rivals as brands are seen pushing a bulk of whatever stocks they have online.
Products now getting sold in what was earlier a mobile only store include car kettle, robo vacuum cleaners, car dash cameras, baby monitors etc.
Sangeetha Mobiles’s director Chandu Reddy said his retail chain is looking at ways in which they start selling portable washing machines. “We are looking at new areas which include the popular car kettles. They became popular during the pandemic and another product we want to stock up on is portable washing machines,” said Reddy.
Another south based large retail chain that exclusively sold handsets is selling personal care products and laptops. “It is not about supply shortages but we were planning to move consumer durables and decided to venture into it six months ago,” said its CEO who did not want to be named.
Analysts are not surprised at this move and say this will work out in the long term for them.
“There is a potential market for consumer electronics and bringing consumer smart devices under one roof is a good move. New product lines and diversified portfolio will help this set of retailers to hedge their risks and reduce dependency on few brands,” said Navkendar Singh, research director, IDC. Business Journal