"Direct and indirect sales in 40:60 ratio will retain market share"

Structured cabling major Tyco Electronics is optimistic about the growing structured cabling market that is now valued at Rs 350
crore. With a leading market share, the company´s Country Manager, KK Shetty is charting out an all-out strategy to retain the position and is unwiring any possible chances for its competitors to overtake the market share. For this, he believes in a mix and match strategy of dealing directly and through channels. 

What is Tyco´s certification program all about?

Tyco´s certification program will help employees of the channel network to get accustomed to the installation of networks in an appropriate way. It is a week-long program with an intake of 15 to 20 students for every batch. It will basically help students design the network, install and certify the fiber optic termination. People without such hands-on experience may tend to design a complex network instead of a simple one. 

The course at Tyco will cover various aspects of installing a network and would offer the trainees a hands-on approach as they will be provided with necessary tool kits. Besides, the state-of-the-art lab facility available in Bangalore will expose them to real-time environments. This certification program is a first-of-its-kind in the country and we have been getting good response from the channel network. 

But with the sole lab facility being in Bangalore, we felt the need for such facilities in the northern region too and hence we opened two facilities in Delhi and
Mumbai, early this year. 

What other initiatives have you taken to create awareness about your products?

Effective product selling techniques are essential for marketing one´s products. Hence, we conduct a day-long program for pre-sales personnel every month giving some quality suggestions about product selling, what features should be highlighted and the USP of the product. And in every quarter, we conduct channel partner meet to keep the communication going. 

We do have an Indian channel partner meet where in we take 120 to 140 channel members to tour outside India. Besides, we do have some sort of technology up gradation programs for our end-customers on a periodic basis. Since technology is changing at a fast rate they need to be provided with the up coming technology. We undertake such programs in all the nine major cities in the country. 

Which market segment do you operate in?

Tyco has got a wide range of products and as far as structured cabling market is concerned, we have classified our market into three­high-end customers serviced through large partners like
Wipro, IBM and others. Mid-segment serviced through regional or local system integrators and finally the lower-end segment serviced through stockists and resellers. 

The market for structured cabling in India alone is around Rs 350 crore and is growing 20% to 25% year-on-year. Tyco has a market share of 46%, while our closest competitor Systimax has a share of 32% and the rest being shared by other players like
Krone. We are expanding and strengthening our presence across geographies. We expect to open our sales and marketing offices in Chennai and Kolkata in the next couple of months and later opt for other regions.

How do you intend to further strengthen your market presence?

Though we have a strong regional distribution model with a fairly good channel network base to service all segments of customers, having our own sales office personnel will further help us in interacting with the channel network and our end-customer base. Hence, we are setting up sales offices in Chennai and Kolkata besides the existing offices in
Bangalore, Hyderabad, Delhi and Mumbai.

With this approach to expand and train the channel network, we foresee an increase in direct sales. Presently, the company makes 70% of the sales through distribution, while 30% is through direct sales. We expect this to be in the 40:60 ratio over a period of time.

Tyco is more than a decade-old company now. How did the transformation from being an unrecognized company to the present position in the structured cabling space happen? 

We entered India through AMP in 1994 and introduced structured cabling in 1996. That was the time when AT&T was a reputed brand and channels were not willing to take up our products. Tyco International acquired AMP in 1999 and ever since, it was renamed Tyco Electronics. 

The exercise of directly educating the customers was the key strategy that was followed by AMP, which was later inherited by Tyco. We started approaching customers individually and slowly started building our network directly to where we are now. With time, AT&T was renamed Lucent, then
Avaya, and now known as Systimax. 

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