The Indian economy in CY2013 went through a challenging phase with high inflation and a slowing growth. This coupled with the state and national elections created a slow-down of the overall economy and ICT spending.
Despite these challenges, the copier market in India has shown resilience. According to International Data Corporation (IDC) the India Quarterly State-Level Copier Tracker shipments were 1.07million units in CY2013. This represents a 1% decline compared to previous year CY2012. One ray of hope came from the color printer segment, showing 20% year-on-year growth, with mid-segment Average Selling Value and above price-band models.
In Maharashtra, Mumbai contributed more than 50% of the state’s copier sales output. Being the financial, commercial and entertainment capital, Maharashtra contributes a good quantity of sell-through from the mid-segment in addition to the entry-level segment (which contributes the maximum in every state.)
In Delhi, the national capital and center for Government, Defense and Public Sector, technology procurement continued. Given almost all copier vendors are headquartered in and around Delhi, they can maximize their focus in these customer segments, particularly in Q1, which is the last quarter of the financial year. Most Government departments funds froze up towards the end of 2013 as the country headed towards National Elections in first half of 2014. While this slowed down the sentiments of the market somewhat, some cash-rich vendors responded with an aggressive penetration pricing strategy.
In Karnataka, Bangalore is the major contributor being the hub of Information Technology/Information Technologies & Enabled Services (IT/ITES) companies. Interestingly, IDC observed that a lot of major companies were setting up their branches in Tier II & Tier III cities of Karnataka such as Mysore, Mangalore and Hubli. The demand from these cities increased whether it is from IT/ITES, Manufacturing, Construction or Education. As one example, HCL Infosystems closed a large deal (nearly 1000 units) on behalf of Toshiba in Q4, 2013.
Rahul Kanwar, Senior Research Manager-Channel Research, IDC India said, "Tier III states such as Punjab, Haryana, Rajasthan, Uttarakhand, Himachal Pradesh, Odisha, Madhya Pradesh, Jammu & Kashmir, Bihar, Chhattisgarh and Jharkhand are growing at 12% year-on-year. Adoption of copiers as the primary printing device as opposed to MFP, Printer-based is due to increased printing demand from the SMB and Jobbers segment is the major reason behind this growth.”
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