Nehru Place and IT Retailers Across India Reopen to a Price Squeeze

IT Retailers Reopen Shops with Mixed Results After Relaxed Lockdown and show that there is confusion in controlling small shopkeepers

23 May 2020 00:00 IST

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Nehru Place and IT Retailers Across India Reopen to a Price Squeeze

IT retailers have been anxious about their sales almost dead because of the problems of Corona Virus pandemonium. This was complicated by the fact that many of the large IT markets are located in the metropolitan cities, most of which were in the Red zone and hence, were to remain shut even if supply chain began in the other parts of the country.

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When in the 4th phase of lockdown shops were allowed to reopen in the Red Zone, while maintaining social distancing, this came as a ray of hope for the IT channel community., especially the IT retailers. However, the unfolding of the reopening process has shown mixed results for the IT retailers.

While sales have quickly ascended to a high figure after the reopening of the IT retail shops, there have been some bottlenecks.

Alok Gupta, President, PCAIT, a channel association with a large presence in Delhi and especially Nehru Place, the largest computer market in Asia talked to DQ Channels about the preparation of the IT channels for the reopening and some of the problems they are facing.

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"We had already planned for the following -
1. Even/ odd
2. Social distancing
3 how to sanitise visitor
4 how to restrict not more than prescribed persons inside showrooms
5. Sanitisation at every store while entering
We feel that there will be rush for the next 10 days as work from home and online education is at its peak due to lockdown
The partners have ample stocks, so fulfulling demand will not be a problem from the stocks perspective.
Nehru Place is opened just 2 days back. We need to control small shop keepers and IT retailers; and the coordination process with administration and police is too cumbersome."
--Alok Gupta, President, PCAIT

In the rush to increase sales and make up for the business lost during lockdown, it seems the smaller IT retailers are eager to race ahead. This brings the challenge of having to keep them within the guidelines from the government about the social distancing, sanitisation etc.

While in Delhi and in other metro cities, the problem is of organising a proper reopening in line with the government's guidelines, the problems in other parts of India seem to be more complex in nature.

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It seems that the products have become more expensive because of lockdown at source, so that the IT retailers have to pay more for purchasing them and they have to sell them at higher prices than usual. This will not compete in the market, especially with the online prices.

"After lockdown our distributors/super stockists from where we are buying the products are now billing us 15%-20% extra from basic price in which we were purchasing earlier due to rise in purchasing cost and lower margin in our line. This is making our products less competitive in the market, especially against online prices.
We are going to our office according to the time our government is allowing us and are ready to face all the new challenges. I have been for last 30 years in business and I have faced bigger loses than this in business, so we all are in this together and we hope that we'll be able to come out of it together.
I think our country has sufficient amount of stock in godowns . I can say distributors have enough to supply, but they are creating panic because of increase in the profits and prices."
--Rajiv Khanna, Spokesperson for Jalandhar Computer Dealers Association (JCDA)

There is also another voice in places away from the metro cities, which has welcomed the reopening of IT retailers establishments, even if the prices are higher than usual. The small and medium-range IT retailers away from the big cities are grateful just to be able to get into business again.

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“Small IT retailers of smaller towns are happy & excited with the permission of reopening their shops & offices. Now they can easily provide better services to their nearby customers having smaller as well as medium range requirements - from toner refill to webcam, wireless mouse, USB HDD, power adapter, Router to PC/Laptop etc., as well as repairing of their Laptop/IT equipment.
Since courier services are still not properly aligned from larger cities, partners are fulfilling their requirements from the stock of other local resellers of city/nearby town, and this practice is improving harmony between them. Yes, stock holding partners have risen the prices marginally, at the same time customer is also ready today to pay premium for timely fulfillment of his requirements.
We should not forget that many more businesses are still not in customer demand & are not able to even survive today. Keeping safety precautions placed, if we are able to promptly understand & manage customer requirements, there are bright chances of our survival with long term profits in this IT business.”
--Basant Mehta, Proprietor, BlueBell Computers
Founder President, Jodhpur Computer Dealers Association ( JCDA)

The problems faced by the IT retailers shows that it's high time the IT vendor companies help them to open parallel online stores and allow them to sell at competitive prices at par with the E-commerce platforms. This is the only way the channel business can survive.