Yet another case of a multinational which would rather spend on advertising and sales promotion rather than respond promptly to a customer complaint
Whirlpool started manufacturing motorised washers in 1911. Since then, it has grown rapidly to become one of the world's largest manufacturers of home appliances. It has a strong presence in India now.
But after-sales support-or just a simple response to a customer query-requires the personal intervention of the managing director of the company. That brings us to ask a simple question-is it possible for each and every Whirlpool customer who might have a problem with any of its products to personally try to get in touch with the head of the company for something that should be a given-good after-sales support?
Here is a case in point. Harsha Parekh, a senior citizen, bought a Whirlpool Refrigerator (a 300 L 'Proton 3' door model) from a Whirlpool retailer, Vijay Sales, at Prabhadevi in central Mumbai on 22 May 2010. The machine was not cooling-Ms Parekh repeatedly tried to call the Whirlpool customer service numbers on 25th May.
All she got was an automated response (of course, with the 'your call is important to us' thrown in) saying that all the executives were busy. Finally, she was informed that she should leave her number and the Whirlpool executive would call her back or send her an SMS. Nothing happened after that.
Finally on 26th May, Ms Parekh got through to a new contact number and was asked to contact the service centre-for which she was given another number. At last, a Whirlpool engineer knocked at her doors, examined the fridge, and proclaimed that the machine would need to be replaced because of a clogged gas pipe.
Moneylife contacted Whirlpool on 27th May on the travails that Ms Parekh was facing. We were told that only Arvind Uppal, managing director; Shantanu DasGupta, vice president-corporate affairs & strategy, Asia South and Tamal Kanti Saha, vice president-sales would be in a position to answer this simple query-when would Ms Parekh's fridge be replaced?
These top executives, we were told, were travelling and could not be reached. This boggles the imagination.
Does Whirlpool require its who's who to respond to customer complaints? Whatever happened to customer service back-up support?
We are not questioning the quality of Whirlpool's products. But is asking for a response from a human on the other end of a help number of one of the world's biggest conglomerates a tad too much? Is this how a customer, say, in Spain, would have been serviced?
Coming back to Ms Parekh's problem, it has finally been resolved. At least, Whirlpool has promised to replace the defective piece by 3.00 PM today, Friday. We'll keep you posted.
And let us add, this is just one of the numerous problems that have been voiced by customers on Whirlpool's after-sales support (or rather, the lack of it). A cursory round of surfing on various customer grievance websites throws up a litany of woes.
As we said, the quality of the manufacturer's products is really not being questioned. What happens after the sale-that crucial last-mile connectivity-is something that Whirlpool needs to take a hard, serious look at.
A third day of rally is guaranteed, but what’s next?
The market closed near the high point of the day amid a high degree of choppiness, normally seen on the futures & options (F&O) expiry day. The sluggish opening on the back of a negative close on Wall Street overnight gradually led to a jagged climb into the green in the morning session. However, a pick-up in Asian markets and a strong opening of European markets gave the domestic indices the much-needed boost and the going was northwards after that.
The upmove was supported by sectors like banking, auto, oil & gas-all of which registered gains of over 2% each. Finally, the Sensex close at 16,387.84, up by 278.56 points (1.70%) while the Nifty gained 87.50 points (1.74%), to end the day at 5,003.10.
The Reserve Bank of India (RBI) late Wednesday allowed banks to draw additional funds from it by opening a second window, to meet the expected cash crunch in the system on account of the Rs1 lakh-crore demand of corporates to meet their third generation (3G) fee payouts and advance-tax payment requirements. The central bank also allowed banks to seek waiver of the penal interest if they have less government securities when they borrow more from the RBI.
All Asian equity markets ended on Thursday after paring early losses as investors resorted to bargain hunting after the recent decline in the regional bourses. The advances were also sustained as the euro surged against other major currencies.
The Shanghai Composite rose 30.12 points (1.15%) to 2,655.92; the Hang Seng gained 234.92 points (1.22%) to 19,431.37; the Jakarta Composite was up 17.14 points (0.64%) to 2,713.92 and the KLSE Composite soared 20.22 points (1.62%) to 1,269.16.
Similarly, the Nikkei 225 surged 117.06 points or 1.23% to 9,639.72; the Straits Times advanced 43.68 points or 1.62% to 2,739.70; the Seoul Composite jumped 25.38 points (1.60%) to 1,607.50 and the Taiwan Weighted added 75.81 points (1.06%) to 7,243.16.
US markets witnessed a negative finish on Wednesday as late sell-off erased gains accrued earlier in the session. The markets ended lower as reports suggested that China was reviewing its eurozone debt holdings.
The Dow fell 69.30 points (0.69%), to 9,974.45. The S&P 500 shed 6.08 points (0.57%) to 1,067.95. The Nasdaq gave up 15.07 points (0.68%) to 2,195.88.
Back home, the Prime Minister's Office (PMO) is likely to take the final decision on the fate of the 4,000-MW ultra mega-power project (UMPP) at Sarguja in Chhattisgarh, which has been delayed due to the non-receipt of environmental clearance.
The environment and forests (E&F) ministry has declared the Hasdeo coal block in Chhattisgarh-which was allotted by the coal ministry for the Sarguja UMPP-as a 'No Go' area, where coal mining cannot be done as it will adversely impact the environment.
The gainers list on the Sensex was led by Tata Motors (up 4.74%), ONGC (up 4.64%), Sterlite Industries (up 4.26%), HDFC Bank (up 3.78%) and Reliance Communications (up 3.11%).
The major losers on the Sensex were ACC (down 1.64%); Bharti Airtel (down 1.29%), Cipla (down 0.64%) and Hero Honda (down 0.21%).
All sectors on the BSE closed in the positive terrain today. The top gainers were bank stocks (up 2.55%), auto (up 2.10%), oil & gas (up 2.09%), realty (up 1.70%) and consumer goods (up 1.63%).
Research firm Religare today said that the economy is expected to expand by 7.8% during the current fiscal, lower than the government's projection of 8.5%, mainly on account of a moderation in industrial growth.
"Our FY'11 (2010-11) growth estimate is 7.8%, versus the consensus of 8.2%-8.4%, on account of the higher base of FY'10, as well as a faster slowdown in industrial activity year-on-year in the second half of FY'11," Religare said in a statement.
The top performers on the Nifty were Reliance Power (up 6.70%), Tata Motors (up 5.70%), Sterlite Industries (up 4.84%), Axis Bank (up 4.59%) and Unitech (up 4.22%).
The laggards on the Nifty were Power Grid Corporation of India (down 1.16%), ACC (down 1.10%), Idea (down 1%), Bharti Airtel (down 0.93%) and Hero Honda (down 0.78%).
Foreign institutional investors (FIIs) were net sellers in equities on Wednesday, offloading stocks worth Rs166.66 crore. Domestic institutional investors (DIIs) were net buyers, purchasing equities worth Rs64.86 crore. The Indian forex market was closed for a local holiday today.
At the time of writing, key indices in Europe were trading with modest gains. UK-based FTSE 100 was up 1.82%, Germany's DAX was up 2.21% and CAC of France was up 2.01%.
The pension regulator needs to take a deeper look into what is weighing down the scheme. Here are a few issues that need to be sorted out, say experts
The pension regulator, Pension Fund Regulatory and Development Authority (PFRDA) has reportedly sought tax relief on investments in the New Pension Scheme (NPS) to put the struggling scheme on a level playing field with other long-term savings schemes. Currently, under the Exempt-Exempt-Tax (EET) system, this proposed shift to the Exempt-Exempt-Exempt (EEE) regime would remove the tax burden at the time of withdrawal. Although parity on the tax front is long overdue, NPS suffers from a host of other issues that are also preventing it from taking off.
The biggest issue facing NPS is uncertainty in the minds of the investing public. Since the scheme does not provide assured returns compared to a scheme like Public Provident Fund (PPF) or the government’s traditional pension scheme (which is subject to revisions), investors are sceptical about the actual kitty they would ultimately end up with. Although the NPS managed a healthy 12% return last year, it had more to do with the phenomenal stock market rally rather than anything else. The performance has to be seen in this context. There is no visibility as to how the NPS will perform over a longer period of time. There has to be much more publicity about this.
Awareness about the scheme and its working is also low. The regulator has sought to address this issue by embarking on a promotion campaign, but some branches of designated points of presence (PoPs) also seem to be unaware about the modalities of the NPS. Sandeep Chimanlal Vasa, a certified financial planner, pointed out to Moneylife that when some of his clients approached a large bank designated as a PoP, the officials there were not even aware about the scheme, far from advising the clients the long term investing philosophy behind NPS.
The biggest issue is the confidence about the payouts, decades from now. Mr Vasa also pointed out that his clients were uncertain as to how the payouts would be handled. “They are unclear whether they need to be after the concerned PoP to get the payment or whether it will get transferred automatically. Also, what happens if they migrate to some other place? They are worried how the account will be handled,” said Mr Vasa. While these issues can be dealt with, what doesn’t help is the inability of PoPs to explain things clearly. PFRDA is also not very forthcoming when asked about details.
A key differentiator for any investment product is the cost involved. The NPS is a class apart in this aspect. With fund management charges of 0.0009%, it is among the cheapest pension products being offered in the country. But what probably takes away its attractiveness is the high annual account maintenance and transaction charges. For an investor who hopes to put in the minimum contribution of Rs6,000 a year, the Rs350 annual charge is a huge deterrent. However, the government has announced that Rs1,000 will be paid by the government for three years to new entrants. This should take care of the costs for a few years.
This cost structure, coupled with the current EET regime is also a disadvantage for investors joining the scheme at a later stage in their life and enjoying a shorter period of accumulations. The tax incidence at the time of withdrawal will lead to negligible returns for those getting in late in the game. The finance ministry should give this aspect some consideration while deliberating upon the PFRDA’s call for putting the NPS under the EEE system, say investment advisors.
Another turn-off with the NPS is the restriction on withdrawing funds. Under the present rules, for any withdrawals prior to attaining the age of 60, investors are required to invest at least 80% of the accumulated wealth to purchase a life annuity from any IRDA-regulated life insurance company. Only 20% of the wealth may be withdrawn as a lump sum. It also leaves the investor a lot to think about while considering his options about which annuity plan should be bought from, which insurance company and what the returns would be.
There is also a restriction on the age of entry, which is currently capped at 55 years. It essentially leaves out thousands of people aged between 55-70 years of age. Also, the current vesting age, fixed at 60 years, limits the scope of people wishing to get into the scheme at the age of say, 53 or 55.
Finally, NPS also suffers from the fact that other products offer incentives to market intermediaries to sell—whether it is for insurance, mutual funds or any other product. Vivek Rege, another certified financial planner, points out, “The way such products are distributed makes a lot of difference. The distribution network has to be extremely strong. If the distribution network is weak, it will affect the chances of the product. There should be some incentive to distribute it and educate the people.”