Refrigerator retailers brace for dismal sales this Eid too
Refrigerator manufacturers and retailers could witness poor customer turnout this Eid-ul-Azha, a major Islamic festival that typically accounts for nearly half of the industry's yearly sales, due to the ongoing coronavirus pandemic, according to market players.
"Sales are completely dull compared to previous years. The situation might be as bad as last year," said Manzurul Karim, general manager of Esquire Electronics, the distributor of Japanese brands General and Sharp in Bangladesh.
Last year the industry failed to see the usual pre-Eid rush of customers following a dengue outbreak across the country and floods in the northern regions.
As an Islamic tradition, livestock are sacrificed during the three-day festival and people purchase refrigerators to preserve the meat, leading to a 40 to 50 per cent bump in sales around this period. Besides, the surge in sales around Eid is also propelled by various purchase offers such as discounts, cashback and prizes, industry insiders said.
However, with the pandemic having brought about great economic uncertainty worldwide, most private sector companies are paying their employees reduced wages and Eid bonuses in a bid to survive the coronavirus fallout.
It is for this reason that this year's sales will probably be insignificant, they added.
Both manufacturers and retailers have accepted the situation but are hopeful that with roughly two weeks to go before the festival begins, sales could reach the same value as last year's.
Market insiders also believe that since Covid-19 has led to a loss of income for many, people could be surviving the pandemic by using funds they kept aside to purchase the quintessential home appliance.
About 14 lakh refrigerators were sold in 2014, but the number ran into 20 lakh in 2017 and 22 lakh in 2018 while sales were around the same in 2019.
This shows that the industry saw an average annual growth rate of 11.42 per cent for the past six years, the industry insiders said.
According to Esquire Electronics' general manager, the industry's sales target for the festive period can no longer be attained while the yearly tally would be 22 lakh units at best, just like last year.
On the other hand, Karim was optimistic that sales of his company's chest freezer line will increase by at most 5 per cent.
"We are not focused on achieving the revenue target this year but instead are just trying to keep the business alive amid the pandemic by offering different benefits to customers," he said.
Since retail outlets across the country are unable to operate at full capacity or at all in some cases due to the ongoing crisis, overall sales have been dull, said Rashedul Islam, product manager of Transcom Digital, the retailer for Whirlpool, Hitachi, Transtec and Samsung products.
"Among other offers, we are providing significant discount exchange offers and a maximum Tk 25,000 cashback on fridges to attract customers," Islam added.
The other offers include a 20 per cent discount on fridges, televisions and air conditioners when purchased with credit cards from select banks as well as a Tk 2 lakh health insurance package.
Meanwhile, Shamim Ahsan Khan, product manager for consumer electronics at Samsung Bangladesh, said that his company's sales are rather adequate as they have already achieved 50 per cent of their target ahead of Eid.
Considering the current trend, sales of chest freezers around the Eid festival could reach 30,000 units. Samsung now assembles almost all of their refrigeration products at the Narsingdi plant, Khan added.
He also said that the price of various home appliances would decrease in future as locally made components that are almost identical in quality to their imported counterparts are being adopted by the industry.
According to Khan, the demand for certain high-end appliances, sans air conditioners, did not decline amid the Covid-19 outbreak. However, sales of low-end products have dwindled as people with lower incomes bore the full brunt of the coronavirus impact, he added.
Vision Electronics, a sister concern of Pran-RFL Group that has 100 refrigerator models on offer, witnessed a 20 per cent increase in demand ahead of Eid while it was 50 per cent during the same period last year.
Kamruzzman Kamal, director for marketing at Pran-RFL Group, said they manufacture 1,000 units daily at their Ghorashal factory in Narsingdi.
Vision Electronics retails its products through Best Buy showrooms and its own Vision emporiums alongside over 2,000 listed dealers.
The company's 50- to 556-litre capacity refrigerators are priced between Tk 12,200 and Tk 106,000 while 50- to 350-litre capacity chest freezers go for around Tk 22,400 to Tk 37,300, Kamal said, adding that glass door refrigerators are high in demand.
Vision Electronics recently introduced the 'Vision Warranty Plus' service, under which any client could get up to Tk 1 lakh cashback upon purchase from any outlet or dealer.
However, clients will have to register for the service through text message beforehand.
Besides, the company also provides equated monthly instalment payment facility for credit cards of 19 banks.
To address the social concern of infection amid the pandemic, sales operations are being run in line with health guidelines, he said.
Similarly, Augustin Sujan Barai, deputy director of the creative and publications department at Walton Group, said that the Eid season is peak time to sell refrigerators but due to the Covid-19 situation, sales have slowed.
During the May-June period, sales were dull but the situation has improved slightly this month, he added.
At present, Walton has over 150 models of frost, non-frost, and chest freezers alongside beverage coolers in the market.
The company offers fridges priced between Tk 10,990 and Tk 69,900, with the option to make purchases on instalments.
The products of other international brands such as Panasonic, Haier, Kelvinator, Mitsubishi, Toshiba, Jamuna, Marcel and Electra are also available in the market.
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