Low entry barriers and low-cost technology has always attracted entrepreneurs to UPS manufacturing. The largest number of UPS manufacturers are located in Delhi, which has almost 70 players.Â
What makes these manufacturingÂ
Ashok Majumdar of Delhi-based UPS Manufacturers Association confirms this and says, “Rapid computerization coupled with erratic power supply in this region has actually fueled the growth in the number of manufacturers here.”Â
Delhi also has a geographical advantage as it is surrounded by Haryana, Uttar Pradesh, Rajasthan and Punjab markets where IT sales are fast picking up.Â
Pune stands second with around 25 manufacturers followed by Bangalore and Chennai. Pune also stands to benefit from its proximity to a seaport like Mumbai. Says Harshesh Malhotra, Senior Business Manager, Tata Liebert, “Pune, being close to a big market like Mumbai, offers skilled manpower and progressive worker unions. This has propelled the growth of the UPS manufacturing in that city.”Â
Pondicherry has emerged as a prime area attracting several manufacturers. Says Imtiyaz Ahmed, Divisional Manager (All India Channels), Numeric Power Systems, “Pondicherry has many advantages such as availability of seaport, airport, quality human resources, power and good sources of components, which favor local manufacturing.”Â
Hurdles on the way
The UPS manufacturing segment faces several hurdles today stymying its growth in the country. The government regulations, which categorize UPS as an electrical product, have discouraged prospective UPS manufacturers due to the high tax structure.Â
However, Tamil Nadu, Karnataka and Maharashtra governments have given UPS the status of an IT product. Meanwhile, the Customs and Excise General Appellate Tribunal review bench has noted that the UPS needs to be categorized as a static
“We have not been successful in our efforts to have the UPS categorized as a computer peripheral. But we continue to be hopeful that this will soon take place,” says Anand Iyer, Country General Manager,
While the debate on the status quo of the product goes on, existing players are worried about the entry of new competitors. But Harshesh of TLL strongly believes that this could be a positive development. According to him, more competition will result in a strong market development. Ranjit Mohite, Joint MD, Aar-em Electronics views this development as an ongoing process. “New players are going to enter and some are going to exit,” says he.Â
With the market flooded with several UPS brands with lucrative offers and schemes, retaining dealers has become a key issue to manufacturers. “It is very important to maintain relationship and trust with our dealers. It is also important to help them grow along with us,” points out Pradeep Pimpley, GM (Operations), DB Power Electronics.
Certain initiatives like dealer development programs, sales and service training and co-operative funding for infrastructure will create dealer loyalty to a particular brand and company.Â
“Ensuring adequate earnings through various promotional schemes and involvement of channel partners in our decision-making process will also drive dealer faithfulness,” says Balaji Brindavan, MD, Quantum Power Systems.
Who will thrive?
Apart from stiff competition and an ocean of UPS products available in the market today, it is evident that the only the fittest will thrive in this industry. Factors like service and support and aggressive marketing strategies alone can contribute in creating success stories.Â
Manufacturers have to look at customer satisfaction by providing feature-rich products and prompt after-sales support. Only a strong channel network is in a position to implement these measures .Â
Harshesh of TLL points out that they have shifted their focus from product cost to solution reliability, which has helped them fight competition locally. Because, at the end of the day, what really matters in UPS selling is total protection to the PC and its peripherals.Â
Sunila Paul in Bangalore with inputs from Saji MP, Mumbai and Mohit Chhabra, Delhi