At the 'Zenith' of success

Asim Raina and Nancy Sudheer

MUMBAI: Zenith Computers Ltd, led by its Chairman and MD, Raj Saraf, has been in the PC business for close to 20 years now and is second to none in terms of its knowledge base in this area. In fact, it would not be an exaggeration to say that this is one company, which knows the finances of the PC business better than anybody else. All these years, not only has the company always priced its products at a notch below the other major vendors, but at the same time, has been consistently making good profits.

Essentially, Zenith for the last couple of years has been following a very simple policy: "MNC quality at Indian prices". By giving quality machines at prices better than the GIDs, the company has been able to build large volumes. Asim Raina and Nancy Sudheer met up with Saraf for a chat on how to survive and prosper in the cut-throat PC business.





How has the year 2003 been for Zenith in terms of increasing consumer market share and sales till now?


In the JFM quarter, the consumer market was down because of school and college exams. In addition, government spending has also reduced compared to earlier. The period after March and June, sales increased, but again festival buying is region specific, during Dussehra not all regions will have high sales, like for example Calcutta sales is slow even during puja time. But one this is for sure and that is we are definitely out of the recession. The market is picking up and it should gather speed in the coming months.





Today most of the PC vendors are introducing desktop solutions with a Linux platform. Does Zenith plan to introduce a similar kind of solution?


The Linux solution is complete eyewash especially in the lower end segment. The consumer today is not comfortable with a PC based on Linux. It's easy talking about Linux but finally implementation and making it a success is a different issue.





In terms of product innovation, Zenith recently introduced a notebook especially for students. What prompted you to launch such a product and how has it fared in the market?


There are a lot of Indian students traveling and staying far away from their homes for higher studies. The families of these students are ready to spend a higher amount on a product like the notebook mainly because it is portable and so easy to keep in touch. In fact, we also introduced a specialized finance scheme for students in association with ICICI. The notebooks have been accepted very well in the market and the most surprising part is that a majority of the sales have happened in the smaller cities across the country.





All vendors are talking about venturing into retail in a big way. What are your plans on this front?


Retail will definitely boom. In fact, Zenith has been present in retail with its own stores for a long time now. In Mumbai there are seven outlets, and this will increase gradually. Manufacturers like Videocon are venturing into retail with its concept of Emart, therefore there is a large retail potential to be tapped in India.





Despite being one of the leading and oldest players in the Indian hardware industry, Zenith has refrained from entering the BPO sector. Any particular reason why you haven't ventured into this booming industry?


Our expertise is in computer hardware, therefore, to get into a new business like BPO, domain knowledge is required. But we would be open to new business ideas, which give good margins and are basically lucrative.





Now that your daughter Devita Saraf has actively joined the hardware business, how much are you involved in the day-to-day operations?


I am basically involved in the decision making of procuring four components--hard disk drives, CPUs, monitors and motherboards. Marketing and hands-on business activities are taken care of by Devita and her team.

(CNS)