The global conglomerate is selling a number of its consumer electronic and home appliance products in India. However, getting through to the company for any kind of customer service can be a daunting task
Chinese manufacturers have swamped the globe with their low-priced products. Walk down an aisle of a supermarket or mall selling electronic items in any developed country and the chances are that you will find the shelves stacked with Chinese goods.
Haier India is a Chinese company which made a mark in the Indian market because of its wide range in low-cost home appliance and consumer electronics products. A price-line below what the overall market has to offer has always been the company’s strategy to increase its customer base. Its product offering includes refrigerators, air-conditioners, washing machines, LED & LCD televisions and water-heaters. But the quality of the company’s after-sales service is a different story.
The most important part that any manufacturer has to take care of is the after-sales service. Haier might be a conglomerate with operations in many parts of the globe, but there are a number of complaints against this multinational on the deafening silence that its customer-service department seems to stoically maintain, despite numerous complaints.
Haier India is a subsidiary of the Haier Group, which started its commercial operations in Delhi in January 2004. Haier has an established dealer network of around 1,600 outlets across the country, with what it proclaims to be a “strong service and after-sales service network.” Haier products are also available at all major retail outlets in cities across the country. The company has almost 18 branch offices & 25 warehouses; six direct service centres & 135 Haier ‘customer-care’ centres with a 24-hour call centre service.
Apparently, according to a former Haier employee (who preferred anonymity), the company does not have enough service centres around the country. Furthermore, the existing service centres are not stocked with enough spare parts—and service technicians usually have to wait for days before they attend to a particular customer complaint.
The customer care number on the Haier India site is barely decipherable.
Here are just a few of the complaints against Haier:
Vaidya DV from Pune-based Ablesoft Computers had bought a fridge from Haier through its retailer Gokul Electronics on 1 September 2006. Mr Vaidya told Moneylife that the refrigerator was not operational when it was installed—it was taken away by Haier for repairs, but it continued to remain non-operational. Mr Vaidya then filed an appeal against the company, but Haier chose not to appear in court for four successive hearings. The customer was forced to run from pillar to post but is still awaiting justice.
Yogesh Sapkale, deputy editor of Moneylife had a similar experience with a Haier phone handset. “I bought the handset and as soon as I inserted a SIM card, the phone went on the blink. I have been trying to reach the Haier customer care department since last year. First I had gone to the Ghatkopar (a Mumbai suburb) service centre after speaking with the chief technician. I had to skip office twice to give the handset for repairs as Haier refused to receive calls. The handset is still lying at the Kalyan service centre. They have changed the service centre and have not bothered to even inform me about the same,” said Mr Sapkale.
Achintya Mukherjee, a consumer activist has also had a similar experience. “We had bought a Haier fridge about three years ago. We wrote to the company as the piece was defective and since they were going to replace it anyway, we asked for a bigger one. At the same time, we were constantly in touch with their main office in Faridabad. It took them nearly three to four months to replace the fridge and we had immediately deposited the cheque as payment for the replacement as well. It took them three months even to credit the amount to their account. Maybe they are not equipped to handle so many customers in India. The initial service support of the company doesn’t seem to be in place because it is not a bad product per se but a bad piece. The fridge is working fine till date.”
When Moneylife tried to contact Haier’s customer-care department, through their customer care number, it was constantly busy.
We finally got through to a Haier India spokesperson (VV Rao), but he preferred not to comment on any of the above cases.
Is this how Haier plans to service its existing customers and increase its market share in India?
In the fourth quarter, HUL spent Rs656 crore on advertising and promotions. However, its net profit (excluding a one-time gain) increased by just Rs46 crore and its sales went up only by 8%, compared to the year-ago period
Hindustan Unilever Ltd (HUL), the unit of Anglo-Dutch Unilever PLC, spent Rs656 crore on advertising and promotions, however its fourth quarter net profit increased just by Rs46 crore, excluding a one-time gain. Even after including the one-time gain of Rs143 crore, HUL’s net profit of Rs581 crore is much less than its ad-spend. In short, after spending Rs656 crore on ads, the company could manage to earn a ‘pure’ net profit of just Rs438 crore compared with Rs395 crore, reported during the same quarter last year.
For the quarter to end-March, the company said its net profit rose 47% on a one-time gain while net sales increased 8%. However, on a consolidated basis, HUL's net profit fell 14% as sales declined 13% to Rs17,764 crore.
During the quarter, the company reported a net profit of Rs581 crore compared with Rs395 crore, in the same period last year, due to a one-time gain of Rs143 crore related to sale of property, long-term trade investments and lower provisions for retirement benefits.
“In an environment of heightened competitive intensity we have accelerated volume growth, ahead of the market. Broad-based actions have been taken to enhance competitiveness of our brands, build new segments, expand offerings in foods and improve the overall quality of our innovations and speed to market. These initiatives have started to yield positive results,” said Harish Manwani, chairman, HUL, in a release.
The company said during the quarter, domestic consumer and fast moving consumer goods (FMCG) business grew 8%, driven by strong 11% volume growth. Growth was broad-based across home and personal care (HPC) and foods and in aggregate, ahead of reported market growth. Although the company reported total revenues of Rs4,380 crore compared with Rs4,057 crore for the March quarter, on a consolidated basis, its total revenues fell 14%. On a consolidated basis, HUL's total revenues fell to Rs17,764 crore from Rs20,891 crore, a year ago.
During the quarter, HUL’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) margins declined 147 basis points on the account of 39%, 28.3% and 10.5% increase in ad-spend, purchase of finished goods and raw material consumption, respectively.
Despite spending Rs656 crore in the March quarter on advertising and promotions compared with Rs450 crore in the same quarter last year, HUL's net sales increased by just 8%, supported by personal care products, beverages and exports. Its soaps and detergents segment declined 2% to Rs1,978 crore from Rs2,016 crore from the year-ago period.
In the fourth quarter, HUL spent Rs206 crore more on advertising and promotions; however, its ‘pure’ net profit (excluding the one-time gain) increased by just Rs46 crore.
For the year to end-March, the company declared a final dividend of Rs3.5 per share, taking its total dividend to Rs6.5 per share, compared with Rs6 per share last year.
HUL shares ended Tuesday 0.6% down at Rs230 on the Bombay Stock Exchange, while the benchmark Sensex closed 2.7% down at 16,022 points.
MMRDA had set a reserve price of Rs50,000 per sq metre (for a minimum price of Rs1,980 crore) for the property. The plot, situated at Wadala in central Mumbai, has a permissible built-up area of 4,95,000 sq ft and 14 top property developers were in the fray
The MMRDA (Mumbai Metropolitan Region Development Authority) today auctioned a 25,000 sq metre commercial plot at the Wadala Truck Terminal (WTT). The Lodha Group won the bid at Rs5,723 crore. The developer will pay 10% of this amount upfront and the balance will be paid over five years at an interest rate of 10%. The plot has a permissible built-up area of 4,95,000 sq metre and the developer is allowed 19.8 FSI on the plot of land. It will be given out on a 65-year lease.
“Lodha Developers won the deal at Rs5,723 crore with interest. We are also granting 19.8 FSI to the developer,” said SVR Srinivas, additional metropolitan commissioner, MMRDA.
MMRDA had set a reserve price of Rs50,000 per sq metre and was seeking a minimum price of Rs1,980 crore for the property. It was finally sold at Rs81,818 per sq metre. There were 14 bidders in the fray: Sheth Infrastructure Ltd, Shriram Urban Infra Ltd, DB Realty, Reliance Infra, Bhakti Realty, Indiabulls, Parinee Developers, Godrej Pvt Ltd, Ackruti Ltd, Sunteck Realty, Gaurhati Estate, Lodha Crown, Raheja Universal and Acne Housing. Out of these bidders, apparently only four turned up for the auction. Sources told Moneylife that Sunteck had bid Rs70,002 per sq metre and Indiabulls had bid Rs67,222 per sq metre.
“It is too high a price that the developer has paid for this land. However, the winner has got more built-up area to construct and the location of the land is not in a crowded place and hence construction with high FSI can easily come up,” said Pankaj Kapoor, founder, Liases Foras.
Moneylife had earlier reported (http://www.moneylife.in/article/8/3991.html) on how MMRDA had failed to attract bidders for a prime commercial real-estate property deal in the Bandra-Kurla Complex (BKC) due to the high price quoted by it. There were around eight prospective bidders—including developers and banks—in the fray.
Currently, residential prices of properties in Wadala are around Rs8,000 per sq ft-Rs12,000 per sq ft.