The Hindu Business Line : Videocon Group may float separate co for after-sales

Mr Eric Braganza, Chief Operating Officer, Electrolux Division, Videocon Industries, told Business Line, "We could look at the possibility of having a separate company for after-sales services. This would be relevant to all the Videocon group brands as it is important to have a dedicated unit to cater to after-sales services."

Currently, Videocon has an after-sales service network, which comprises both direct services and franchise operations.

With a host of brands such as Videocon, Sansui, Akai, Electrolux, Kelvinator and Hyundai, the consumer durable major has felt the need to spin-off its after-sales services as an independent company. As Mr Braganza stresses, "We should be looking more closely at after-sales services, which is expected to get treated as a separate company later."

Meanwhile, its acquired brand of Electrolux is expected to reap profits this year. Focussing on its product range, Mr Braganza said, "All this time the sales for the Electrolux brand was not that high because the product was not good and the high cost of manufacturing was eating into our profits."

More high-end models

Introducing more high-end models under sub-brands such as Ala carte and Deo Fresh, Electrolux would be positioned as a mass premium brand focussed at the top end of the market.

Explained Mr Braganza, "We would look at high-end models to hit at our target audience for the brand, which is expected to break-even this year. In refrigerators, the focus would be on the frost-free segment, while in air-conditioners we would be targeting the split models.''

While refrigerators contribute the bulk of the sales for Electrolux, the company expects the air-conditioner segment to add to its sales in future.

"Today, refrigerators contribute 65 per cent of the turnover but we expect the air-conditioner segment to increase its contribution from 20 per cent to 35 per cent of the company's total turnover," he said.

Retail venture

Vending its fare through high-end multi-brand outlets, Electrolux is also expecting Videocon's own retail venture - Next, to add to its sales. "We already have 250 Next stores where the brand is being sold. Besides, we are also looking at other retail formats such as Reliance Digital to expand the scope of our brands,'' Mr Braganza said. The Electrolux brand expects to register a turnover of Rs 700 crore this year.

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