The Indian market for smartphones is steadily growing as the country’s 1.3 billion strong appetites for smartphones increases. Last year, India Becoming the second-largest smartphone market in the world, leaving behind only China, in terms of the number of devices. But the unprecedented COVID-19 epidemic – as analysts predict – is expected to have a huge impact on smartphone sales in 2020.
According to a report by Counterpoint Research, India’s smartphone market grew by just 4% in the first quarter of 2020, which includes the months of January, February, and March. This is a concern because only the lockdown started in late March.
The government-imposed lockdown restrictions prevented any non-essential movement, which meant offline stores were inaccessible. He and the ban on e-commerce activities ensured that smartphones were not accessible to those who wanted to buy one. Not only shopping, but restrictions left people to fix their faulty smartphones in a bizarre way.
Associate Director of Counterpoint Research, Tarun Pathak said, “We see zero activity on smartphone shipments in April and now entering a lockdown amid uncertainty, Q2 2020 is going to be really challenging for smartphone manufacturers in the country.” ”
Given how important smartphones are for education and business in these recent times, many people believed that the sale of some other electronic devices such as laptops such as smartphones should be allowed during the lockdown.
Not only sales and shipments, but also the lockdown completely shut down manufacturing units in India and saw an impact on the supply chain. Smartphone companies manufacturing in India including Samsung, Xiaomi, and Realme to name a few, manufacturing units completely shut down with the introduction of lockdown.
Now that manufacturing has begun for some of these manufacturers, they are not yet operating at optimal capacity. In a conversation with Mashable India, Madhav Sheth, CEO of Realme India shared how the lockdown affected their manufacturing operations.
“Compared to the demand we are seeing, we are facing a big shortfall. The 60-day lockdown has eliminated supply chain disruptions. Even now, when the factories have opened up, we are facing a problem regarding manpower, as most of them have moved into their homes. Madhava said that we expect our production to normalize from mid to late July.
Smartphone companies have made rapid strides, but what is lost… .Lost
While there was little that could be done regarding phone sales or manufacturing during the lockdown period, smartphone companies were quick to come up with solutions suited to the situation at hand. We saw smartphone companies adopt the O2O model (from online to offline), which allows users to order products from offline retailers located near their homes.
See: How Smartphone Companies Ensured Access During COVID-19
But the status of COVID-19 is not as simple as restoring the supply-demand balance. However ensuring that smartphones are still accessible – especially when waiting customers will eventually be looking to make their pending purchases – is another problem for smartphone companies: after lockdown.
The lockdown has led to uncertainties and with no final word on when things will return to “normal” (that if it ever does), consumer demand is not expected to spring up quickly. This uncertainty has prompted companies across the country to resort to paying cuts, unpaid leaves, and layoffs to ensure they can survive this difficult period.
If this effect is widespread enough, consumers will have to limit discretionary spending that may impact on the smartphone industry.
“Consumer demand will have a major impact on smartphone sales, as people will focus on savings and therefore limit discretionary purchases. As soon as entry-level smartphone consumers are most affected by the lockdown, entry-level smartphone demand will decline in the near term. We believe that demand will shift to the second half of the year. Even if the situation stabilizes by mid-year, people can stop buying till the festive season, ”says Praveer Singh, senior research analyst at Counterpoint Research.
As a result, Counterpoint has also reorganized its estimates of overall smartphone shipments and now estimates it to be reduced by 10% in 2020. Gurugram-based market insights company TechARC has also reduced its projected sales by 20% due to the impact. Epidemic on supply chain and consumer demand.
If these assumptions are to be believed, this will be the first time