Interview – Raj Kumar Saraf

By : |June 24, 1999 0

Raj Kumar Saraf, Chairman and Managing Director of Zenith
Computers Ltd., created news recently when an Indian Market Research Bureau
(IMRB) survey
revealed that Zenith was the No.1 brand in the home segment. Being No.1 is not something
new for Raj, who was the first to introduce notebooks in the Indian marketplace. He also
pioneered local area networks in the country. And all along, he has carried the channels
on this success trip with him. CI met Raj to find out the role the channel has played in
putting the Zenith brand on the top of the minds of homebuyers.

A recent survey by IMRB showed that Zenith is the
No.1 brand in the home segment. What role has the channel played in catapulting Zenith to
this position?

So you are accepting the fact that Zenith is No.1?

Yes, as per the IMRB survey, you are No.1 in the
home segment.
You are accepting this.

                                 

___________________________________________________________________________________________________________

Yes.

I am keen on your acceptance because one of your magazines (of the Cyber Media family) had
raised the issue of whether we are No.1 or not. We have spoken to the magazine concerned
and have clarified that it was IMRB that had come out with an independent survey. The
result of this survey showed that we are but No.1 as far as the home market is concerned.
So there is no issue on that.

But HCL did raise some objections…

Yes. But then anybody can raise objections on any survey. Why only HCL? Even Wipro and
Compaq can raise objections. But what is the purpose of raising objections? I can also
raise objections on whether HCL is doing a particular thing right or wrong. Is it not a
fact that HCL forced a Cyrix product without any upgrading facility, on the consumers?
What is the fate of those customers who went for this product? But we looked after the
consumer’s interest and we did not opt for that product. We too could have indulged in
this gimmick. But we have not done that.

The reason the IMRB survey found us No.1 in the home
segment was because at the time when IMRB was conducting this particular survey, we were
in the media in a big way with our home PC ads. The national media is a witness to that.

Besides ads, how have the channels been
instrumental in placing your company at the top bracket?

Zenith has been always a channel-friendly company. Channels believe that we deliver what
we promise. We have achieved this No.1 position obviously, because we were better tuned to
the needs of the consumer. Be it in terms of better product, better delivery, better
support, or better price…everything better.

What is that one critical factor that has ensured
your success?

I would say, the prime factor is price. Home market being very price-sensitive; we have
won this market by offering attractive prices.

How have you managed to lower your prices?

By cutting costs at every level, not cutting down on quality, but cutting our costs of
distribution, costs of marketing, costs of retail.

But in the home segment, overall, the assemblers
are still the leaders. Why can’t even Zenith beat the assemblers?

We can’t beat assemblers because Zenith is only one, while there are over 2,000
assemblers. Their reach is wide. They are offering lower prices than we are. They enjoy
the flexibility of lower overheads.

How big is your distribution network?

We have close to 375 active dealers today, from Bhutan on one side to
Tuticorin, on the
other and from Assam on the eastern side to Saurashtra on the western. We have one of the
biggest distribution networks in the country today.

How did you manage to develop this network?

We worked on the confidence of our dealers. Today, our dealers have complete faith in us.
Hence, they don’t hesitate to pay us in advance, which is not the case with other vendors.

How has this confidence come about?

Mostly through word of mouth. You can’t just give a big talk to a dealer to do business
with you. You have to show by your action that your business practices are above board.
You have to build confidence in your dealer, which is exactly what we have done.

What activities do you conduct for your channel
partners?

We have meetings, conferences and roadshows practically every month. These are rotated
region-wise so as to keep our channel partners constantly informed about our products.

Are you looking for channel partners currently?

Sure.

What are the terms and conditions to become a
Zenith channel partner?

No conditions. We are very very flexible.

But I am sure you must be having at least some
criteria…
Some minimum amount of business.

How much?

At least Rs 2 lakh of business every month.

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