Inalsa sets sights on South

The Rs 80-crore Inalsa brand of small home appliances is expanding to South India, setting its sights on Chennai first.

Speaking to Business Line , Mr Sunil Kumar, Chief Operating Officer, Inalsa, said the company had begun to make its products available and was negotiating with other established traditional and modern retail stores such as Ratna and Vivek's to stock them.

It is also looking at the Bangalore and Hyderabad markets.

Known for its food processors, it is well entrenched in the North and recently entered the West.

The North accounts for 50 per cent of its sales.

Inalsa's product range includes food processors, mixer grinders, MW ovens, vacuum cleaners, cooktops, chimneys, hobs, geysers and fans.

It is eyeing a growth of 30-35 per cent in 2011.

The company wants to increase the number of distributors from 120 to 200 and the number of retail outlets it is present in from 3,000 to 5,000 by June 2012.

Usually, the company spends 6 per cent of its topline on marketing but this year it will spend more. The projected turnover for 2011 (January–December) is Rs 110 crore.

Price and position

Inalsa's targets are the middle and upper middle-class. Its prices will be similar to products of Bajaj Electricals, Mr Kumar said, adding they were not yet prepared to take on the “big brothers” in the market.

They will be priced between Rs 400 for an electric iron and Rs 40,000 for a decorative cooker hood. The food processors will be priced between Rs 4,595 and Rs 5,295.

According to him, the kitchen appliances market is estimated at Rs 2,000 crore including national and regional players such as Bajaj, Black & Decker, Morphy Richards, Maharaja, Philips, Usha and Butterfly.

Inalsa has been around since 1985 but went through a series of ownership changes, having at various phases belonged to the Usha Shriram group and Turner Morrison, and about six years ago, was acquired by the Spain-based Taurus group which operates in 95 countries. Sixty-five per cent of the Inalsa range is made in India, some of it in an exclusive factory in Himachal Pradesh, and the rest is imported from China and Spain.

Problems associated with the ownership changes and business strategy resulted in Inalsa not being able to expand its business.

An executive at a South India-based retail chain said Inalsa had not been able to create consumer pull or dealer push in the South.

In some cases, they had also had trouble honouring service guarantees, he said, taking care to add, however, that his firm had dealt with the brand 6-7 years ago.

Another shot at the market

Inalsa had launched its food processors in the South many years ago but the region's culinary habits were well served by mixers and wet grinders (for coconut chutney, idli, dosa ) and the price did not make sense either, says Mr Kumar.

However, now, there is a “more cosmopolitan culture”, hence the expectation that the brand will do well, Mr Kumar said.

Quality has been improved and the motors in the food processors are more powerful at 600-650W as against the earlier 450W, he said.

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