Aizawl: The Retail Push
The retail segment contributes to about ` 120 crore annually, making the state the 2nd highest revenue earner from a single segment in the entire north-east region
Sharing its domestic borders with Tripura, Assam, Manipur and international ones with Bangladesh and Burma, Mizoram became the 23rd Indian state on February 20, 1987. Adorned with lush vegetation and picturesque valleys and hills, the state features a prominent and developed tier of channel partners concentrated in and around Aizawl, catering retail services to an odd potential consumer base of 11 lakh people.
The population is drawn and spread on similar lines to that of Arunchal Pradesh; a fully developed retail segment comprising 80% of the available channel business in the state is a distinct advantage. Further, the state benefits from a more educated populace (Mizoram has the second highest literacy rate of 91.58% as on 2011) who are in a better position in regard to technical know-how and price factor.
"We have 37 partners in the state, out of which 25 are based out of Aizawl. Having said that, the channel ecosystem is evenly spread in the state but limited to retail only," informs John Chetri of The Computer Store.
The retail segment contributes to about ` 120 crore annually, making the state the 2nd highest revenue earner from a single segment in the entire north-east region. Besides, channel partners in the state had a healthy growth rate (although limited only to retail) at 16% with key emphasis placed on the bottomline.
"Major brands in the mainstream IT segment have performed well over the past 2 years with the consumer trend titling towards mobility devices. Besides, we have a good product mix in the market," Chetri added.
The second largest segment after retail is the state government that floats tenders alike Manipur. Tenders are often in the range of ` 5-8 lakh catering to small upgrades or computerization projects in the local administrative level, but at times goes up to ` 4.5 crore, like the recent tender of NCERT. The good part in the state is that for all the tenders, whether big or small, the channel partners are able to compete, although at times, with their principals. This factor has, however, led to suppliers in the government through principal agencies rather than evolving the channels as system integrators.
However, the lack of both distributors as well as sub-distributors is one of the most deterring factors leading to stagnancy in channel mobility. Distributors operate from Guwahati, and logistics takes over a week's time to reach the destination. Although the condition of roads in the area is still better than Andhra Pradesh or Nagaland, Mizoram is still categorized as a remote area despite its large market size. "Roads to Shillong have a four-lane layout and are wide enough, which makes logistics in Meghalaya smoother. Here, the road condition is not so good and is quite narrow at points," Chetri said.
However, in the business aspect, the largest deterring factor is the lack of proper service centers in the state which partners have termed as ‘just for namesake'. Service quality and turnaround time remains the primary concern for the channel partners who complained that in some cases it takes over a month to replace parts or get a new one shipped across.