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Services Opportunities In Laptop Business
 
Partners feel that vendors should invest in extensive service infrastructure for post-sales support. But vendors argue that India currently does not have a critical buyer mass to justify heavy investment and also have to consider RoI.
 

 
Monday, May 03, 2004

 

Vendors should invest in service infrastructure...
Vendors are not investing enough into a complete service solution infrastructure. This in the end is disastrous for them as well as partners. In the west, buyers seek replacements instead of repair. But in India, where labor is cheap, vendors should invest in an expansive service infrastructure. This should include component-level servicing. Only then will buyers be assured of good support and go for the vendor’s brand of laptops.

"Vendors should appoint specific knowledge
partners, who can do value additions, for selling
laptops"
Ashok Kaul MD
Vast Notebook Serve

Partners should focus on service...
Partners selling laptops should rethink their selling strategy. Just selling it without commitment is not desirable. Partners should take the onus of service, if partially, on themselves. The consumer-buying behavior is changing and it is becoming more demanding. With the breaking of price barriers, individual and SOHO segments are doing most of the buying. This segment is particularly demanding, not only price performance but also in terms of after-sales service.

Specialized laptop partners needed...
There is too much hard-selling or soft-selling of laptops by partners. This is due lack of knowledge or over-commitment of sales targets to vendors. A balance has to be established. This is all the more necessary because industry analysts talk of laptop unit sales exceeding 1.2 lakh this year. Vendors should not concentrate on pushing laptops through the regular partners. Instead knowledge partners, who can do value additions, should be specifically appointed.

High incidence of obsolescence...
With high cost of replacements and no clear charter about warranty policies, customers are skeptical about after-sales support. This in turn affects our business. Vendors should realize that providing good support is the key to gain customer mindshare and not merely dropping prices or giving freebies.

Educating partners about service opportunities...
There is no reason why laptop services should only be rendered by vendors and their specified service partners. Especially because service is a more lucrative revenue stream for partners. Earlier margins on laptops sales used to be about eight times over PCs. But now they are equivalent. So vendors should educate and train them on how to make service a profit model for the laptops.

"There is no need to create a new set of channel for laptops as
no special
expertise is required"
R Manikandan
DGM, IT Products
LG
Electronics

Let vendors handle the servicing end...
To build in an extensive support infrastructure, a vendor needs to look at the investment and also its RoI. At the moment, India does not have such a critical buyer mass, which will make component-level servicing a viable proposition. Besides that, one must also bear in mind that component-level failures are far less in number to other laptop-related problems.

Expertise needed to handle support...
Laptops are not as delicate as one might think. Therefore there are not many service-related issues. Besides laptops also require expert handling in case of servicing. This is possible only by technically qualified personnel. That is why we have already appointed select service outlets for after-sales support. We expect these centers to provide the first-level servicing and take care of escalated queries as it will need a certain set of expertise. Often, partners themselves might not be willing to invest in technical manpower for providing support.

No need for new channel network for laptops...
I don’t see any need to create a completely new set of channels for laptops. It is a product that is to be sold to the end-customers and no special expertise is required by the partner. Invariably, there are two prominent customer segments: desktop users who will buy a laptop as a one-time purchase and corporates whose purchase is on a recurring basis. However, we will add more partners to sell products, since this is a growing market.

Newer technologies are emerging...
Most consumer are outgrowing the perception that an IT product is meant for life. They are well aware that the product life-cycles are very short now. This is because newer technologies are always emerging. And every buyer would like to have the latest technology at their fingertips. One can’t term this as technology obsolescence. Rather it is the constant evolution of the market.  

Partners aware of service opportunities...
Partners today are a well-informed lot and know which business streams are the most profitable. As a vendor, we do educate them on how they can position their business best at various seminars and meets. But ultimately, the decision to upscale themselves lies entirely with partners.

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