Annapoorna Agencies is one of the leading distributors and has proven itself as a strong partner over the years, developing core strengths that have been instrumental in its growth. During an exclusive interaction with Mobility Magazine, Mr. Srinivas Nallacheru, MD of Annapoorna Agencies, explains in detail the strategy incorporated to trigger growth, the current market trends, etc.
How did you fare in the last one or two years as a distributor of Xioami mobile phones?
The last two years have been very difficult for us, and post-COVID, there have been a lot of implications for the business because of which the industry has gone down. There was a downtrend in business in the last two years, particularly in the last financial year.
However, as per the industry, demand has gone down by more than 30–40%. Keeping in mind our strategies and our abilities, Xioami has added four districts in Telangana, which has helped us maintain our growth. The penetration of more districts in Telangana, is helping us augment growth.
Please explain the changing trends in the distribution segment and consumer behaviours
The market is changing from GT(GeneralTrade) to OT(OrganisedTrade ). Resulting in the GT outlets, counter sizes coming down. Consumers are preferring the OT outlets because of their display of the range of products, sales support, and marketing efforts. Consumers are moving from the low end to the mid-range, where they are looking for minimum 6 GB of RAM and 128 GB of ROM. At the higher end of the price bracket, the market is growing by more than 50%.
We have over three decades of experience in the distribution of FMCG, telecom, electronics, home appliances, and mobile handset industries. This has helped us to understand the changing trends and tune in our expertise to give the best customer satisfaction, thereby emerging in the hierarchy of distribution of Xiaomi products.
Please explain the impact of online trading on offline trade and how you are managing this.
Over the years, the Internet has had a very bad effect on GT. Due to the aggressive pricing offered online, retailers started buying online and selling to their customers with GST bills. The GT partners were not able to match the price; hence, they are forced to buy either online or from big wholesalers to cater to their customers.
Our strategy has been the adoption of social media and special initiatives. We are managing by supporting the partners in social media marketing with special incentives based on the targets from our side. Overall, online and OT together are forcing the GT market to shrink in terms of market size and in terms of the number of dealers as well.
We request all Brands should give more focus on Offline trade to safeguard Indian traditional trade instead of fully focussing on online.
Why do you cater to just one brand – Xiaomi? Do you plan to add any other brand apart from Xiaomi to your brands list for distribution?
We at Annapoorna Agencies offer dedicated distribution solutions in Hyderabad and across the state with customised personal service and guaranteed quality. We have an exclusive agreement with Xiaomi; however, we are also looking at noncompeting products that we are exploring and are ready to take their distribution as well.
Our realm of services is not restricted to just distribution; we are also looking at opportunities in manufacturing, import, and export.
Explain the importance of the after-sales service and customer satisfaction to business. How does your service support differ from others’?
Customer satisfaction and retention are greatly influenced by after-sales services. Annapoorna has realised that Xioami is a consumer-centric brand that takes its customers’ experience seriously and has built a robust chain of after-sales service centres.
Being a technical product, after-sales service is very important for mobiles. Xiaomi has more than 33 service centres across Telangana. On the contrary, its competition has fewer than half of Xiaomi’s service centres. The faster one addresses customer issues, the more easily it can enhance customer satisfaction.
What improvements in support do you expect from Xiaomi?
We are expecting Xiaomi to balance the pricing between online and offline. The consumer pull used to be very high for the brand, but now it’s non-existent. Moreover, the brand needs to have a few hero products that can drive demand for the brand.
What is your future in increasing your sales and then your reach to new buyers and areas?
We are trying to work closely with our partners to increase our counter share (extraction) and expand to areas where there are still gaps, particularly in the upcountry areas. To increase our revenue we have also entered Retailing under the Brand name “CELLBAY”. We have over 60 outlets across Telangana ;apart from that, we are looking at expansion in Distribution and other opportunities like manufacturing, import, and export.
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