Flexibility and Agility drives Growth

Hong Kong-based Astrum Holdings Ltd, one of the key players in the digital accessories business operates via multiple subsidiaries across 42 countries, including India and has shown resilience in the face of the Covid-19 threat. As the pandemic graph illustrates a gradual ‘tapering off’ stage in China, Manoj Kumar Pansari, Founder, Chairman & Managing Director, Astrum Holdings Ltd. spoke to Corporate Citizen on the company’s firefighting mode in combating the current crisis with insights into his domain and a few takeaways across Astrum’s core sectors of mobility, audio, IT peripherals and smart gadgets. Manufacturers of high-end products in China, it collaborates with leading Original Design Manufacturing (ODMs) for exclusive designs and production. With the global pandemic and related ‘lockdown’ phases, electronic gizmos and accessories have become the ‘lifeline’ to work, play and for general living and Astrum looks to keep afloat despite the odds. Astrum is a recipient of the Globe Luxurie Awards (Dubai), ‘Most Promising Brand of Hong Kong’ award at GEA 2018, also recognised for the best range of quality Power Bank, and Portable speaker at the 10th Edition of DT Awards 2019

“The IoT market size in India is estimated to grow and reach $9 billion by the end of 2020. In India all upper homes and house owners aspire for smart homes and the trend is slowly growing amongst the middle-class populace for smart home solutions. …It is estimated that Smart homes (India) are growing at a rate of 30 % and the market revenue is predicted to double in the next three years”

MANOJ KUMAR PANSARI

“We strongly believe the flexibility of work is the best practice, especially during a pandemic situation. Correct planning makes it work better. Implementing a flexible work policy and infrastructure is the best way to minimise business disruption resulting from pandemic, as is the situation today,” said Manoj Kumar Pansari, Founder, Chairman & Managing Director, Astrum.

Established in 2008 with its headquarters in Hong Kong, Astrum began as a computer peripherals company but is a revamped version today offering multiple segment digital accessories and product solutions. Hailing from Rajasthan’s Ramgarh Shekhawati region, Pansari’s journey has been a long one, as he said, “There were days when I had toiled the entire day and night without any rest. The idea to establish my brand in Hong Kong was based on the high rate of technology demand out there. It is also called a smart city powered by tech-savvy people. And, that was the reason behind my drive to startup my business in Hong Kong.”

His entrepreneurial family background provided him with an ingrained “business sense”. A commerce graduate, Pansari worked with multiple startups before he founded Astrum. “It was during my days as an employee in Kaira (Mauritius) Pvt Ltd, (a regional distributor of computer parts, accessories, IT products, networking and data storage products), that I was inspired to start Astrum with perseverance and dedication. Kaira, owned by my uncle Suresh Kumar Pansari acquainted me with his vision towards the company which has also been one of the reasons that empowered me to start Astrum”, he said.

Pansari shares Astrum’s grit in facing business challenges pre and post the pandemic. An excerpt:

Business vs Pandemic

"The learning has been for the best and the takeaway is that the future of work demands flexibility and agility. This is especially true in a world in which natural disasters and other emergencies continue to wreak havoc on the global economy. As regards China, with the drastic fall in Covid-19 cases, our workforce at our headquarter and factory, have now resumed their respective work”

Astrum’s presence across 42+ countries globally has led to cautious steps being taken to keep all their international business travels on hold until further notice with domestic work-related travel ban request whenever possible. They have also encouraged employees to work from home wherever and whenever possible. While this follows general norms for most businesses, CC captures few ‘learnings’ in the face of the ‘Covid’ crisis.

How is the company coping with the onslaught of the Coronavirus?

The learning has been for the best and the takeaway is that the future of work demands flexibility and agility. This is especially true in a world in which natural disasters and other emergencies continue to wreak havoc on the global economy. As regards China, with the drastic fall in Covid-19 cases, our workforce at our headquarters and factory, have now resumed their respective work.

What are the visible business impacts of the pandemic?

The Covid-19 outbreak in China has hard-hit all our global supply chains. We are staring at production cuts and possible delays in the launch of new products due to the pandemic, also, the outbreak in China has disrupted component supplies. The scale of the impact would depend on how long the disruption continues. To lighter the impact to a possible extent, we are working closely with our supply chain associate partners to minus the losses.

What percentage of your productivity has dipped in the past month?

At Astrum, we are facing a drop in production capacities where the scope of work stands at 50% of the output from China. But our employees are working hard to fill the gap, suffered during the past one month.

What will be the impact on the company’s global turnover?

Globally, the company’s turnover is $ 130+ million and has been impacted by the pandemic. This has led the company to immediately rethink on its existing supply chain.

Kindly explain the impact of supply chain redressal viz China.

A huge portion of the world’s electronics come out of China’s factories, including parts which are also manufactured in China’s factories. The suspension of production has hit the overall supply. China is also one of our major markets for sales and profit. This has not only affected the development of unit sales but also led to significant adverse effects on our production, the procurement market and the supply chain.

Do you have alternate plans?

With respect to the supply chain, we do have some suppliers in the Wuhan area (the alleged origin of the outbreak). While the majority of our suppliers are from Wuhan, there are also alternate sources available and we are working on mitigation plans to make up for the anticipated production loss, whatsoever.

How is the company coping with the current ‘easing off’ of the outbreak in China?

While the company’s turnover has taken a hit, our offices and headquarters in China have currently resumed work and production schedules. As regards payment of our workers and employees, nothing much has changed with the March payroll, as for April, we are yet to take a call. Luckily, all our staff and workers are safe and have been in quarantine since mid-March. Our HR department has embarked on a daily recce whereby they make sure that discipline is followed with regular attendance and tasks that needs to be completed by the team.

The India Interface

"While the majority of our suppliers are from Wuhan, there are also alternate sources available and we are working on mitigation plans to make up for the anticipated production loss, whatsoever”

Manoj Kumar Pansari receiving the innovative techformer award at World Business Conclave, 2016

Do you have any plans for global assistance in breaking the pandemic cycle?

We are looking forward to helping India and other countries to fight against this pandemic by distributing mask and other products.

Astrum forayed into the Indian market in 2017 as a ‘new technology brand’ that primarily focused on four verticals of mobility, audio, IT peripherals and smart gadgets and by 2019 it had launched its ‘Made in India’ products in the audio category. It operates via its authorised service centres across 1500+ locations in India. Its India Innovation Center was envisaged to create an end-to-end solution. It is currently in the process of establishing its first India-based manufacturing facility at Tirupati, Andhra Pradesh (AP) at an estimated investment of Rs 100 crore. To be spread across 16,000sqm, Astrum proposes to up its benchmark via ‘state of the art’ technology and quality machinery at this facility.

What are your Pan India expansion plans?

Astrum strongly believes in expanding its reach at the Pan India level by growing with its channel partners who are our allies for sustaining our brand image. Currently, we garner 90% revenue from our offline business which comprises 70% from Tier-II and Tier-III cities. We are very optimistic about our product line of ‘big speakers’ in the ‘speakers’ category to cater to Tier-I cities. We will soon be visible across all major outlets such as Reliance, Croma, Vijay Sales and others for a distribution growth target of 10,000+ units. The facility will cater to its global markets and follow stringent quality standards. Our target is to achieve 400% growth in India in the next two years and measure our sales achievements.

What was the idea behind the AP facility and related R&D centres?

Encouraged by our success in the global markets for almost a decade as one of the leading mobile and IT accessories player, we propose to leverage our strengths and experiences by replicating the same in India. The vision is to think smart and challenge traditional norms by creating highquality innovative products for enhancing the way people live and enable consumers to ‘Experience the Difference’. Our teams are collaborating with new partners every day which affirms Astrum’s popularity in India too. We also understand that aligning with more partners and parallel growth and profitability is not an easy task – it’s a two-way process. While our team works very closely with our partners to understand the gaps and explore growth opportunities through regular interactions, we also try to understand their expectations and suggestions on our brand from time to time.

What is the scope of IoT (internet of things)-based smart devices for India in comparison to the world market?

The IoT market size in India is estimated to grow and reach $9 billion by the end of 2020. In India all upper homes and house owners aspire for smart homes and the trend is slowly growing amongst the middle-class populace for Smart home solutions. It has been observed that two features - security and lightning control were popular among the Indian market. Thereby, the popularity of other features is currently quite low, and India lacks maximum utilisation of Smart home technology solutions. The security and automatic control features in urban areas seem to have attracted many households. It is estimated that smart homes are growing at a rate of 30% and the market revenue is predicted to double in the next three years.

Which countries show maximum sale or has more potential for IoT devices?

Astrum’s performance in the Indian market has been robust, we have been consistently registering growth month on month both in terms of revenue as well as market share. Bangladesh, South Africa and Hungary have shown parallel growth in almost all our product categories.

How challenging is it to sustain the Astrum brands amongst other premium brands across product categories?

Price is one key element that we have leveraged in India. We provide superior quality products at an affordable price. Our widening product portfolio has seen a positive response amongst consumers and acceptance in the Indian markets. We are quite optimistic about our ventures and are expecting steady growth for our products. Astrum finds recognition amongst leading brands for digital accessories in India.

Marketplace

What is Astrum’s USP?

Our strongest USP is our array of products that cater to a diverse sector and our adherence to the EPQ ‘mantra’ (Excellence, Price and Quality) which has helped to establish a strong foothold in the Indian markets. We are grateful to our competition for keeping us on our toes which has been motivating enough to provide the desired customer-centric results from our products.

Which is your most lucrative product category?

Whether it is for mobile accessories, audio devices, IT or LED lights, we have put all our efforts to break the trade-off between innovation, quality and cost. However, Astrum’s audio range is currently offering us the best result. In the current year, we have seen a high demand for our barrel speaker, trolley speaker and portable Bluetooth speaker.

Who are your direct consumers?

We are currently working with regional distributors in developing distribution channel networks nationwide. We operate with our Northern and Eastern regional distributors in India who in turn coordinate with area distributors. Plans are to tie in with distributors across the Western and Southern regional zones across India in the current year. We recognise this pathway as a long-term association for the brand and are closely working towards developing several channel-friendly schemes and policies.

Who are your prime competitors?

We compete with multiple brands in the market for different products in India. The only thing we don’t compromise is on the quality of our product that keeps us ahead of our competitor brands.

Name the most trendsetting smart technology devices.

Fitness and wellness devices account for the highest revenue generated segment globally, which includes smart watches, smart glasses (VR & AR) and others. Wristwear is estimated to reach $41,000+ million by 2022. This has become highly popular among youths as well as adults and elderly.