White Goods and Consumer Durables

December 6, 2019 India INC

White Goods and Consumer Durables

If consumer is the king of the market then India is, certainly, the right kingdom to sell white goods and consumer durables. The second most populous country in the world with huge middle class population, having rising income and growing aspirations, has proved that they are the best buyers. Driving the demand for white goods and consumer durables is the easy availability of consumer finance which has shoot up the sell of refrigerators, freezers, cookers, dryers, washing machines, dishwashers, room air-conditioners, microwave ovens and other home appliances. In fact, it is expected that the demand for CTVs and ACs will grow in double digits, while refrigerators and washing machines are likely to record a moderate growth of 5-10 per cent in coming years. In fact, India’s decision to reduce the import duty on consumer durables has given the sector a further boost. Likely to benefit higher capacity segments like LG, Samsung and Sony, the new policy has proved a blessings for these firms. The reduction in import duty on alloy steel, copper, zinc and polymers is also likely to have a positive on refrigerators, washing machines and the air-conditioner products. All these measures are sure to provide good incentives to the MNCs operating in India. The rapid growth of the consumer durables sector in India has been attributed to a number of factors, including the entry of multinationals and the competitive strategies adopted by them. However, a key driver of sales growth in the white goods market has been the easy access to consumer finance. The cost of consumer credit has declined significantly, with retail loans registering an average growth of 27 percent in the past 3 years. Not only this, the sales of white goods in rural markets have also been rising steadily. The rural market grew at an average rate of about 24 percent per year between 1993 and 1998. With India’s low and middle income group fast catching up with the latest products, gizmo and home appliances; the white goods market is all set to expand further in years to come.