How has the journey been of Häfele in India so far?
In the last 3 years, the company has opened four flagship showrooms in Bangalore, Delhi, Mumbai, and Kolkata, apart from the well-networked franchise and dealer base that it already has in different parts of the country. By this year end, we will open two more flagship showrooms – a second one in Mumbai and a new one in Colombo, Sri Lanka. In addition to this, we aim to grow our existing franchise network (of 62 partners) with over 20 new showrooms by the end of 2015.
What is your product range available in the country and sectors currently you are catering to?
Häfele India's core business is to introduce latest global home interior trends into the Indian Markets. As a result of this, we provide 360 degree home improvement solutions right from consultancy to designing of kitchens and wardrobes to provide the best product functionality to our customers. Häfele's product functionality includes the best in door, kitchen, and furniture fittings. With the inclusion of latest technologies in premium appliances and furniture lighting and cutting-edge designs in sanitary and bathroom products in our core product offering, we hold the potential to provide holistic home interior solutions to our customers.
However, it is important to mention here that while we do consult and provide designing services to our customers, we don't create furniture units for them. Over the years, Häfele has built a substantial network of OEM and Kitchen partners and we suggest the best of these partners to our customers for the creation of cabinetry and furniture that optimally matches the Häfele quality and functionality.
How do you see the market of built-in kitchen appliances in India?
The built-in appliance market in India is still at a very nascent stage. We have not yet caught up like it is in other parts of Asia, be it Singapore or Malaysia. But we are going forward and the market is increasing at 25 to 30% in the built-in kitchen business in India. The current market size is of approximately INR 750/- crores. In the next five to 10 years, it is going to be a big business in India and that is the reason why other foreign brands have either already entered into the Indian market or are planning to do so soon.
The built-in appliances concept is a new trend on the block – and like anything new, it's catching the keen eye of the Indian customer. While the concept has reached the target customers, the decision to buy built-in appliances is on a slow yet steady upscale. The main reason for this is that the integration of built-in appliances in an existing kitchen requires some amount of back-work (especially if the kitchen is not modular). On the other hand, in case of designing new kitchens, this process is relatively square. The installation of built-in appliances is largely dependent on the modularity of a kitchen – it follows the same designing principles of modular kitchens where the cabinet heights and depths are standard while the width can vary as per customer requirements. Most of the built-in appliances available in the market are available in standard sizes as per the cabinet modules. Therefore, the growth of this segment is directly connected with the growth of the Modular Kitchen Market.
Häfele is very active in the kitchen business with almost 50% of its business coming from this segment. How are you planning to strengthen your presence in the Indian Kitchen Industry?
Apart from this, our product lines of furniture lighting, kitchen sinks and kitchen faucets are also gaining popularity among our customer base. We are the pioneers of furniture lighting in India and have the widest range of products in this segment. With these synergized product lines and constant reinvention in our core kitchen hardware range, we hope to maintain our presence in the market as a leading kitchen brand.
We are also looking at penetrating deeper in the local markets of every region in the country with smaller kitchen-shop formats. The idea is to partner with existing local players and attach our value proposition, quality and functionality to their inherent brand. This will work mutually for us and the partner – we will reach out to a wider customer base and our partner will add value to his kitchens through our functionality and quality!
Would you please brief us on the evolution of Häfele's state-of-the-art Design Centers and the popularity, the concept is gaining? After Mumbai, Delhi, Kolkata, and Bangalore, what are the destinations Häfele is looking to open its Design Centers?
Häfele's design showrooms are hubs of international home interior trends and cutting edge designs presented in a world-class environment, where customers can see our home solutions in their inherent applications. Our Design Showroom is a one-stop-shop for all your home interiors and improvement needs - from receiving in-depth technical advice to kitchen and wardrobe designing services from our team of experts stationed at the showroom.
We currently have four showrooms in Delhi (since 2013), Mumbai (since 2013), Kolkata (since 2014) and Bangalore (since Jan 2015). By the end of 2015, we will open a similar set-up in Colombo (Sri Lanka) to cater to the specific demands from in and around of the city. We will also start designing a second showroom in Mumbai towards the end of this year which is most likely to open in early 2016.
After these projects, the next destinations in the pipeline to open our design showrooms are Pune, Chennai, and Gurgaon.
How do you see the market of tier II and tier III cities for your products? What are your plans and marketing strategies to penetrate into these markets?
Häfele is already a well-established brand and preferred partner for all home interior needs among the Metropolitan markets. We want to focus now on taking this proposition, more aggressively to the Tier II and III cities. There is a lot of potential in these markets and the aspirational inclination of the customers (from these cities) is increasingly bending towards innovative and international home trends. The real estate development in smaller cities is growing at a faster rate than it is in the Metros. This automatically poses enormous opportunities for our brand. The strategy is to expand our retail network in next 5 years to local markets; to partner with existing kitchen players from these markets and to uplift their inherent brand proposition by attaching our functionality to it. We have already started our journey towards this and are actively seeking suitable partners to take our brand into all relevant markets from these cities.
Could you please tell us about your channel partners and services to customers?
The brand Häfele makes a promise to provide world leading products to our customers. We felt that those products could only be showcased properly in such an environment which delivers on this promise. Hence we made the decision to start our exclusive Hafele studios together with our franchisees. The response continues to be extremely positive. We have now 62 studios and have ambitious expansion plans with our franchise model for the future.
Architects and specifiers play a big role in selecting fittings as many options are available in the market. Could you please tell us about the promotional and educational programs Häfele is running to educate them about the quality, functionality, and most importantly cost-effectiveness in the long-run?
Our communication and selling approach is predominantly 'consultative' in nature. We believe in providing 360 degree solutions for which we engage directly with Industry experts and customers, alike, to understand their core requirements and then provide customized solutions.
To facilitate such engagements, we have deployed company-owned flagship showrooms in all major metros where industry experts like Architects, Designers, and Contractors are invited to experience our product functionalities in actual home applications. You can experience the derived benefits of our products at these showrooms amidst leading designs and state-of-the-art technologies. We hold a lot of focused group events for Architects and Designers at our flagship showrooms, giving them an opportunity to interact with our competent innovations and solution-based services.
Owing to the inherent technicality of our product range, we also deploy certification programmes for industry contractors (kitchen and cabinetry assemblers and manufacturers) who are ably trained on the installation of our key products and fittings and then recognized as certified Häfele installers. This initiative is purely educative in design to increase the overall competency and skill of the Industry contractors (and their carpenters) in India.
