Why Is Offline Market Opposing Essential Tag For Mobile Phones

Even though ICEA and handset makers want smartphones under the list of essential items, offline retailers have a different opinion. Offline retailers have also asked the finance minister to consider their request as such a move might damage the attempt of controlling the COVID-19 cases.

The retailers said that e-commerce companies and handset makers want to reduce loss as mobile phones contribute 60 percent to their revenues. This comes after leading smartphone brands Oppo, Xiaomi, Vivo, Apple, and more asked all State Governments to consider smartphones under the essential list.

Notably, India Cellular and Electronics Association, which represents all mobile and laptop makers is also looking for the essential items for all products. However, this move is expected to bring 1.5 million workers back on the work and that's why All India Mobile Retailers Association said that this might damage all efforts.

"We are facing a crisis when cases are skyrocketing and the healthcare system is collapsing. We are putting the nation ahead of our personal business interest, unlike these foreign e-commerce companies, and requesting the government to continue treating devices as non-essentials," the national president of All India Mobile Retailers Association, ArvinderKhurana was quoted by ET.

The firm said that regional lockdown might not affect the sale of smartphones. Besides, the firm added that these companies want to make a profit and they are not bothered about the safety of Indians.

ICEA And Analysts Views On Lockdown

On the other hand, Pankaj Mahindroo, chairman of ICEA said manufacturing facilities in Karnataka, Andhra Pradesh, and UP are working, but there are some challenges in Delhi. However, industry experts believe that smartphone makers might face inventory issues.

"Chances are there will be inventory issues due to dip in demand, especially in May. Offline retailers are very cautious, especially when there is the uncertainty of business operations amidst rising cases and the possibility of partial lockdowns," Tarun Pathak, associate director at Counterpoint Research said.

Similarly, Upasana Joshi, associate director at IDC said that the companies purchased components to meet the growing demand, but the lockdown and economic slowdown are affecting the purchasing power of consumers.