HP Inc is exploring entry into the refurbished market for personal computers in India, as part of its push to make affordable products, its top executive told ET.
Refurbished products are second-hand computers repaired to be resold or products that are made by reusing and recycling different components of various computers.
“One of the big pillars we are focusing on affordability in India. We know in India we have to give the price value proposition. We are looking at is the refurbished market in India. It is a large market and it is largely unorganized,” said Sumeer Chandra, MD, HP Inc in India.
HP is making a big push towards affordability in India. Recently the company launched mini-desktops starting at a price range of Rs. 19990 for students and education institutes.
“We are looking at it and seeing if there is a way we can participate in the market, either by providing our own refurbished product or come up with an alternate product that would compete with the refurbished product,” he said.
While India has seen a surge in smartphone adoption with over 350 million users, PC adoption has still be in low. In 2017, less than a ten million PCs were sold in the country and companies are seeing double digit growth. Yet, it is still small.
Chandra feels a refurbished market will give HP an entry into a price sensitive segment of the population who is familiar with a smartphone but has never used a computer before. It will rely on its extensive network on support centers in India to repair and resell used computers.
“We do believe that if we can provide a quality solution then we can see more customers walk into that, their willingness to try will be much higher and help drive better adoption. It will help acquire new customers, bring in first time buyers and over time they will buy a new computer,” said Chandra.
HP Inc has a market share of about 32 percent in the PC segment in India as on June 30, 2018, according to IDC.
HP wants to target first-time buyers such as college students, customers from Tier 2 and 3 cities. It feels adoption of computers will accelerate in the future with broadband connectivity. “It is a sizeable market. We just started to look at it. For informal players there are decent margins. It is an important market because it is serving a market we are not able to serve – providing products at a lower cost,” he said.
He added the discussions were in initial stages and he did not have an elaborate strategy plan or business models to share at present.
Flipkart, which launched a separate site to sell refurbished electronics including computers, the market is expected to be a $20 billion market in 5-6 years.
(Theh Economic Times)
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