The home is a person’s sanctuary during a lockdown. So, how has the home fittings industry been affected by the lockdown?
With most people staying indoors as a result of the lockdown, companies that make home accessories are more relevant than ever. During a conversation with afaqs!, Sunil Narula, vice president, marketing, Panasonic Life Solutions, joked that an unexpected side effect of working from home is there’s no demarcation in terms of when work begins and when the day ends. For a traditional company like Panasonic Life Solutions (that manufactures components like wires, switchboards, etc.), technology adoption is slow and might not have taken place this way, under normal circumstances, says Narula. “The organisation at large has got used to the fact that we have to use Zoom for these calls, have large meetings on Microsoft Teams, and so on. All these things that people previously found difficult, and thought were not the best ways to communicate, have become the new normal for us.”
Here are edited excerpts from the conversation about life during lockdown, and the priorities post-lockdown.
Can you tell us how your brand has been affected by the lockdown so far?
March is a very critical month for us because that’s when we have our annual sales closing. We were badly impacted, both in terms of top line and bottom line figures. In the last 10 days, we’ve lost almost Rs 260 crore worth of sales. That’s how the seasonality of it is, and how businesses like ours are structured. A lot of our sales depends on the demand in the last 10 days of the month. Our sales in April were zero, because of the lockdown. All physical stores, markets, everything was shut, and there was no economic activity. However, around April 28/29, when lockdown restrictions were slightly relaxed, we started seeing a bit of movement in the market.
Slowly, we’re seeing things limping back to normalcy. Our brand is deep-rooted in Tier II and IV markets. These smaller markets have been impacted, but not as much as the metros and Tier I markets. Business activities are continuing in smaller markets. This has resulted in the business undergoing some level of resurrection. We’re seeing sales and market movement in places like Bihar, UP, Chhattisgarh, Rajasthan, and so on.
People who began their house renovation pre-lockdown have to find ways to finish the work, because it’s very difficult to live in a half-finished house, with wires hanging out or without fans installed. With the relaxation in lockdown norms, the core work has resumed, and it’s reflected in the fact that shopkeepers and dealers have started selling their stock again. In upcountry markets like UP and Bihar, some bit of government and construction work has started, and that has also resulted in the supply figures going up.
The other important thing that has happened is the resumption of fan sales, since it’s the summer season right now. Unlike an air conditioner or a cooler, a fan is actually a necessity right now. Shops selling fans were allowed to open up their doors and that has helped get our sales in place.
How is your business affected by negative consumer sentiment?
Consumer sentiments are down and will continue to be down for a while, even after the lockdown is lifted. There will be impact in terms of the money available, and consumers will defer purchase of luxury items. For example, if a person’s house already has an AC, then he will defer upgrading it till the lockdown eases, or the economy improves. Right now, the consumers will try to conserve cash and spend money only where it’s absolutely necessary.
How do you think consumer behaviour will change after the lockdown is lifted?
There will be a lot of caution after things begin to normalise. Social distancing will persist, people will avoid going to markets, or anywhere out in the open. There will be a conversion to online sales, and people will prefer it to going to offline stores. If I relate things to our business – you need to understand that we can’t make sales online. In this category, sales still largely happen in the offline world.
People might be more dependent on the electrician to choose switches and electrical fittings for their house, since they might not want to go out and buy things themselves. People might also no longer want to go to a crowded market to buy goods. They might prefer to shop at a local market, even if the prices are slightly higher. Footfalls are going to go down and electricians are going to play a larger role in decision-making.
Even offline stores might start going online. There’s an awareness that fewer consumers will go to stores to make purchases (unless it’s critical). So, some of these stores might get into the practice of taking orders in the same way that a restaurant takes orders from customers on the phone, to make deliveries. We might even see models that combine elements of offline sales and online shopping to create a completely new model altogether.
What will be your top 3 priorities once the lockdown ends?
The safety of my employees and their relatives would be my biggest priority. Even when work from home ends, we will observe precautions before opening up our offices, including sanitisation of work spaces, maintaining social distancing and wearing masks. For some of our offices, we might continue to work from home even after the lockdown is over, and only ask them (the employees) to come in when it’s necessary.
It’s also necessary to take care of our channels of distribution. We have a strong network of nearly 3,600 dealers and distributors across the country, and they are an essential part of our business. We will do our best to support them, though supplies and logistics is a big issue right now.
We want to ensure that all our channel partners are adequately taken care of in terms of cash flow and supply of goods. We have made sure that the suppliers have got their payments despite the lockdown, and we have arranged for soft copies of documents required to facilitate international shipping. We have also got additional permissions to ensure that our warehouses can stay open.
How have you been communicating with your consumer once the lockdown began?
We’ve been using our social channels to communicate with our consumers, though the focus has been communicating with our electrician community and channel partners – who double up as influencers for us. We’ve conducted 35-40 training sessions about our various products to ensure that our stakeholders, namely electricians, distributors and dealers, are adequately trained and their skills are upgraded, at a time when they don’t have too much to do in the market.
We haven’t used mass media (television or print media) to communicate since the lockdown began, but we’re active on social media. Apart from our trade business, a big share of our business comes from construction and renovation. Consultants, architects and others have been engaging with us over mails and LinkedIn, too.