Hirji Patel’s first job was developing mathematical algorithms for guided missiles, at the guidance weapons division of GEC Avionics in Rochester, UK. Then he went on to work with the weapons division of British Aerospace. Two years later, he quit to become one of UK’s highest paid software consultants. However, he decided to go into business by forming Allied Computer Industries (ACi) UK PLC in 1992, as a specialized notebook company. In 1994, he set up Total Computer Cover (TCC), to sell computer insurance policies. With the help of TCC, ACi became the first company in the industry to bundle a comprehensive insurance policy with every notebook supplied. Hirji tells CI what differentiates ACi from other notebook manufacturers:
What makes ACi different from other companies?
When ACi India was formed in 1992, the volumes of sales were low. We understood the fact that servicing notebooks calls for special skills. In Europe we were one of the few companies to have notebook service centers. So we set up a dedicated notebook service center in India too.
Could you elaborate?
Well if something goes wrong with a desktop PC, you can change the motherboard. You can buy spares in the market. But with notebooks, that is simply not possible. That is why the notebook market is fundamentally different from the desktop PC market. Usually, OEMs tend to outsource manufacturing from the Far East. There is no way they can keep an inventory of spares. This is because of the frequent changes in models.
Now it so happens that all the parts of a notebook model, are made specifically for that particular model. So once a model is discontinued, there is no way any OEM can supply spare parts. It is just not feasible. That is because the entire production line is scrapped.
So how does ACi solve the problem?
At ACi, all our engineers know notebooks inside-out. We can diagnose faults in notebooks right up to the component level and repair them. Components, unlike spares, are freely available in the market. So we are in a position to repair any brand of notebook. At the moment, our failure rate is less than two percent.
Does this apply to ACi’s notebooks?
Yes. At ACi, we manufacture up to 10 percent of spares. We never run out of spares. We also replace the motherboard with another motherboard if we have to. We are the only notebook vendor who can repair even an eight-year old model.
Can you compare your service with that of other notebook manufacturers?
I do not want to take names. But I can tell you that all other manufacturers usually ask their customers to leave their notebooks behind. The turnaround time is very high. Sometimes customers have to wait for periods as long as six months. Besides, they inflate the prices of components and motherboards to such an extent that it becomes cheaper for the customer to buy a brand new notebook.
That never happens with ACi. Firstly, we service all notebooks whichever brand they may be. In the UK, we are working towards a turn-around period guarantee of 48 hours. In fact, 80 per cent of our customers there already get a 48-hour turnover. At least half of them get their notebooks back on the spot.
Is it the case with ACi India too?
We are aiming at providing the same kind of service here. Already we are the only company in India to supply customized notebooks, no matter what the configuration. Also, our prices are atleast 20 per cent lower. We always tend to come to the market with the latest technology at the lowest price possible. Our lowest priced machine is less than Rs 80,000. We expect our competitors to follow us, not lead us.
But do you think that there is enough demand in India for notebooks?
Last year, the notebook market in India grew by 95 percent. This year it will be over 200 per cent. Prices are still high. But this is bound to change very soon, as more players enter the market. ACi plans to keep setting the trends. By October, ACi will be the only notebook vendor to have an ISO 9002 certification.
So how does ACi plan to cash in on this demand?
We are planning to set up a manufacturing plant in Gujurat. This plant will manufacture one lakh units per annum. This will be an export oriented unit, which will manufacture for OEMs. Initially, the plant will do only the assembling of components. Manufacturing will take place only after we float an IPO. We plan to go public within two years.
But does ACi have a channel strategy in place?
Yes, very much. We intend to capture the all-India market. Our entire channel strategy is geared towards growth through sustained service. During the next four months we plan to set up offices in Bangalore, Chennai, Hyderabad, Ahmedabad, Calcutta and Delhi. We will have full-fledged service centers. We also plan to appoint distributors very soon.
We will be supporting the distributors wherever we set up regional offices. We also plan to introduce leasing and finance schemes. We plan to introduce leasing facilities to corporates in a big way soon.
How many units do you plan to sell?
By the end of this financial year, we plan to sell around 2,500 pieces. By 2001, we expect to do 5,000 units.
What will be your strategy to achieve this?
Our strategy is service. We also have plans to come up with good schemes. We are planning to give lifetime technical support as well as a lifetime ‘labor only’ warranty.
Do you plan to introduce any new models?
We are launching a P-III with a CD-RW very soon. It will have e-mail reception as well as voice-mail reception capability. It will also have programmable keys. We will have different models at every level. The entry-level model will be priced at Rs 90,000 while the high-end version will be priced at Rs 1.3 lakh. We have already launched our touch-screen model in the UK three months ago.
How many notebooks have you sold so far?
So far we have sold 1,500 notebooks in Mumbai.
– Bobby Anthony