EX CL USIVE ‘
Our intention is not to be a retailer’
In his first interview for Alert, BSH UK CEO, Gunjan Srivastava, gives Sean Hannam his views on the challenges of Covid, its reasons for selling direct-to-consumer, the supplier’s relationship with independent retailers, the importance of sustainability and where he sees the opportunities to grow the business.
Gunjan Srivastava took over as the CEO of BSH UK in April 2020, just as Covid restrictions came into force. It was a baptism of fire. “I started on April 1 – April Fool’s Day – and lockdown started the week before. It wasn’t the most perfect start,” he says, speaking to Alert in his office at the appliance manufacturer’s UK HQ in Milton Keynes. For the first few months in his new role, he was running the UK from Singapore due to travel restrictions – he was previously head of BSH’s Asia Pacific region and responsible for business in India, South East Asia, Australia and New Zealand.
“It took a while for me to physically come to the UK – I couldn’t get there until early September, so for five months I was in Singapore, running a second shift,” he says, adding: “It took me quite a while to get to know my team, my customers and my stakeholders face-to- face – more than six months.” Covid meant that BSH was hit by severe supply issues and stock shortages, caused by increased consumer demand, the closure of production sites and a shortage of components, including chipsets, semiconductors, and materials like steel and plastic.
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We’re not doing anything disruptive when we’re directly accessing the consumer. From a pricing or stock perspective, we’re treating our direct-to-consumer channel the same as any other retail channel
“Typically, what tends to happen is that either you
are being squeezed by demand or you have a supply problem – since 2020, as an industry, we have been hit with a bit of everything,” says Mr Srivastava. “That kind of demand surge wasn’t anticipated by
the industry. Factories and facilities were also shut down during lockdown, which resulted in us not being able to cope with the demand surge that happened, and, before that could settle down, we ran into a shortage of chipsets and semiconductors, which further amplified the backorder situation. “Some of the waiting lists were getting up to six months or more. It took time to fix it – at least six months. But now sell-in/ sell-out are more or less in tandem. It’s all calmed down – the current demand is the current sell-in.”
Sean Hannam: What’s your take on the major appliance market now? It’s quiet out there and quite tough, isn’t it? Gunjan Srivastava: It’s been like that since the beginning of the year. Post-Covid, we had a bumper 2021 because people had stayed at home and were renovating and replacing their appliances as quickly as they wanted to. Since 2022, we’ve seen a decline in the market and
that’s continued into 2023 as well. From an AMDEA perspective, we see the market down almost six percent by value year-to-date, and about 11-11.5 percent by volume. The collective estimate is that the market will remain similar for the remaining months of the year and isn’t likely to bounce back until the second half of next year.
SH: Is BSH’s business in line with your expectations? GS: We’re doing better than the market, so, from that perspective, we’re doing OK – our market share is slightly better than it was last year, however, we didn’t expect the market to decline as much as it did. What we plan to do is to hold on to our position in the market and to further consolidate.
SH: How does the UK compare with other markets you’ve been responsible for? GS: Online penetration in the UK market is quite high – more than 50 percent for our industry, which is probably one of the highest in the world I’ve seen. If I compare the UK with some of the markets in
Asia – leaving aside the North Asian markets – it’s much more advanced and it’s been like that for the last five or 10 years.
When Covid hit, it resulted in the consumer journey
getting disrupted – online moved up to 80-90 percent because offline wasn’t possible, but, after that, it stabilised again to 50 percent. What’s interesting is that the consumer journey has moved – the usage of online and social media… Whether you’re buying offline or online, a lot of your journey is online. From a channel perspective, I think the fact that
there are still thousands of independent trade partners spread across the country is unique – both in the [electrical] retail side and on the kitchen side. They do a great job in combining the relationships [they have with their customers] with great service, and they also have a good online presence – they are improving their online abilities. From our go-to market perspective, we have to
make sure that we are where the consumers are – that makes it quite interesting.
▶ ▶ Editor’s Interview: BSH 31
Editor’s Interview
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