The Indian TV market is known to be one of the best and most aggressive ones globally. The growth in TVs sales is fundamentally motivated by price sensitivity and the vast untapped market, creating a lot of space and opportunity for manufacturers.
However, the situations are not how they used to be before the lockdowns and global disruptions. Budget TVs like mi tv 32 inches have also started climbing up the price ladder with unpleasant hikes, product stocks are usually lower than before, and after-sales support took a significant hit as well.
Let’s take a closer look at the seven reasons why TVs are getting more expensive in India:
Initial Price Hike
Initially, manufacturers noticed that demand was not taking a significant hit with small strategic increments in TV prices. SO they have to chose to go ahead with this strategy.
Market disruption
As with all products, the prices of TVs are based upon their supply and demand. Smart TVs are becoming more and more indispensable with time and are thus slowly becoming less flexible with prices. With almost a year of no sales, there was a long backlog of demands.
Customers were interested in making the TV purchase but were unable to do so. Typically, with a sudden increase in demand and an all-time low supply due to various factors, the prices were calibrated.
Running a business with partial capacity
It’s no secret that the economic loss due to lockdown and other co-related issues hit many businesses. While the demand for TVs was high, it doesn’t fundamentally indicate high profit or great business. In fact, the inability to manufacture and sell products made matters worse.
After almost nine months of sales wiped off, TV manufacturers still needed to explore ways. So that they can achieve their pending annual targets in a shorter period.
Furthermore, most factories located in different states are also bound by restrictions laid by local authorities and are currently not allowed to operate at full capacity, which is creating a bottleneck in TV production.
Supply chain disruption
The backlog of production is not just from the TV manufacturer’s side but also due to their raw materials and various component suppliers. Easy to use but complex products such as TV have to rely on numerous sources for most of the components used in their product.
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The majority of the Indian TV factories act as an assembly hub after procuring most of the parts and components from outside the country; hence all parts need to be available at the correct time for the TV production to proceed. However, the TV component suppliers are also in the same dilemma as they are facing similar hurdles while trying to meet the TV manufacturer’s demand.
Dependency on China
India being a price-sensitive market, lots of TV experts confirm that local value addition will play a crucial role in keeping the TV prices down and driving up customer demand.
But anyway, some of the core components aren’t yet being manufactured locally in our country. It will take quite some time for India to get in a position to bring the entire supply chain from China to a few of its production-driving regions or states.
The ongoing dispute with China has also delivered a critical blow as some prime components can only be procured from there.
Economic factors
Even if the above factors eventually normalize, TV manufacturers will still be affected by various internal and external factors. The most noticeable one was the hike in GST from 12% to 18% on certain components. This had an immediate impact on the price of TVs; for India, which is a price-sensitive market, such additional cost is not always easy to pass on to the customers.
Currency Fluctuation
Other than GST charges fluctuation, there’s also the role of the depreciation of Indian currency against the US dollar. TV manufacturers need several components and raw materials as soon as possible.
These are the seven reasons why the Indian TV market has turned around over the last few months. The lockdowns and global disruptions played a significant role in pressuring the budget TVs space. But the developments mentioned above had a ripple effect on others in the TV sector’s supply chain.
But as more and more Indian companies are taking the reign of manufacturing raw materials and components locally, which is a solid and clear indication that customers won’t have to face such a sudden increase in TV prices in the future.
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