After a tepid growth in 2018, Panasonic India is betting on its B2B business to boost India revenues.
In FY19, Panasonic India revenues grew to Rs 10,300 crore from Rs 10,200 crore in the previous year. Over 75 percent of these revenues came from consumer-oriented businesses such as Smart TVs, washing machines, air conditioners, refrigerators etc. all of which saw extremely slow growth given high competition from Chinese brands such as Xiaomi.
For the next fiscal, the company has set an ambitious target to clock a revenue of Rs 12,000 crore. For this, Panasonic is consolidating its units in India to ensure it can better counter the Chinese aggression both in B2B as well as B2C sales.
“We are extremely committed to provide end to end solutions across our products and technology solutions, and this is a key strategic change the company has made. In the next 5 years, we expect to drive 25 percent of our revenue from the solutions business in the B2B offerings,” Manish Sharma, President & CEO, Panasonic India and South Asia, told BusinessLine.
B2B services is the most profitable business unit within Panasonic in India and it expects to grow at a CAGR of 25 percent over the next five years.
The diversified technology company is investing steadily across supply chain solutions in manufacturing, retail and logistics to boost this further.
Panasonic recently ramped up its energy solutions business, and is now present across stationery and mobility solutions focused on smart EV charging service.
“Currently we approach customers in isolation through different verticals. Now, consolidating all hardware solutions under one vertical and offer software solutions on top of that,” Sharma acknowledged.
As part of this push towards providing end to end solutions, Panasonic India recently merged two of its businesses – welding business and SMT (Surface Mount Technology) equipment business- to consolidate its software and hardware capabilities aimed at offering end-to-end integrated Smart Manufacturing Solutions.
“All of Panasonic India’s products and solutions will be built around smart, connected and energy efficient,” Sharma said.
From a consumer category perspective, Panasonic is looking at increased focus on its appliance business and also promises to penetrate deeper into Tier III and IV towns and increase its multi-brand outlets to 12,000 from 9,000 presently.
With this, the company hopes it will not only be able to counter Chinese brands but would also be able to improve its margins through integrated services such as Smart Home solutions that will put the Smart TV at the center of the home, allowing it to act as the screen to control every switch and appliance in the house.―The Hindu Business Line