Handset sales down 40pc since January

Sales of mobile handsets have dropped more than 40 per cent in April compared to the January level after consumers tightened their belt as they see no immediate end to the coronavirus pandemic.

And amidst the second wave of Covid-19 infections, sales have fallen further as the government introduced movement restrictions and lockdowns.

The sales were great during the first six months of the current fiscal as the pandemic led to soaring digitalisation. Many people had to purchase digital devices to cope with the new normal, including remote offices and virtual meetings.

The country’s top mobile phone manufacturers and assemblers said that they had started trying to sell the devices online after the new surge of the virus.

However, it was not enough as people were more inclined towards purchasing gadget items from the physical stores.

“The mobile phone market generally remains down in January. But we thought sales would increase from February but did not,” Mohammad Mesbah Uddin, chief marketing officer of Fair Electronics, Samsung’s local assembly partner, told The Daily Star.

“For the second wave in March and the lockdown in April, our sales dropped 50 per cent to 60 per cent,” he said.

Fair Electronics, which started assembling Samsung handsets in June 2018, churned out 6 lakh units of smartphones that year, 13 lakh in 2019 and 17 lakh last year.

More than 99 per cent of Samsung-branded smartphones and tabs are manufactured locally, said Uddin.

According to him, despite the pandemic, the mobile phone industry grew by 15 per cent last year.

“Smartphone sales dropped to 20 per cent in March, April and May last year because of a strict lockdown and fear of the virus. From June, it rebounded strongly, and sales skyrocketed and post-lockdown two months covered that three-month’s business,” he said.

He is not optimistic about sales being strong like last year, even after the opening of physical stores.

According to Bangladesh Telecommunication Regulatory Commission (BTRC) data, local manufacturers and assemblers got permission to market around 1.86 crore handsets in the first six months of the current fiscal.

The total market size of handsets stands at around Tk 11,000 crore, and the annual demand for mobile phone stands at 3.20 crore. Of it, smartphones account for only 28 per cent, or 90 lakh, industry people said.

Zakaria Shahid, managing director of Edison Group, the parent company of Symphony, said the growth of the mobile phone market had stalled this year.

He was not optimistic about the business in the coming months.

“Another challenge the local brands are facing is a shortage of components of mobile phones. Starting from China, the price of the components has gone up everywhere in the world. The overall supply chain disruption has increased the price of components,” he said.

Local brands have been more affected, but international bands not so much. However, there are supply limitations for every brand, he added.

“Before Covid-19, we had no problems with the supply chain. We had to stock up materials before the pandemic because of the Chinese New Year holidays. And this year, we have been facing a component shortage since March,” he said.

A salesman in Mobile Network, a cell phone store in Bashundhara City Shopping Mall, said the market was sluggish from January, and since March, there was almost no customer coming into the store.

“We have already opened the store, but the presence of customers is very thin,” he said on Sunday.

However, local brand Walton is flying high thanks to its strong presence in the feature phone and cheap smartphone segments.

In the first three months of 2021, Walton sold 1.8 lakh units of smartphones and 11 lakh feature phones worth Tk 200 crore, according to Asifur Rahman, head of sales of Walton Mobile.

“The business in Bangladesh is not good like in other countries of the world due to the pandemic. Despite the new surge of the virus in the country, the sales of Walton-branded mobile are quite well this year,” he said.

He said a significant number of mobiles were being exported to the European market in the current second quarter. “We are launching several new models of smartphones on the occasion of Eid. I hope this year will be good for the mobile phone market,” Asif added.

Last year, Walton produced 50 lakh units of phones and sold devices worth Tk 600 crore.

About business in the first quarter of the year, Oppo said the world was going through a tough time due to the coronavirus pandemic, and Bangladesh was no exception.

Like other brands, Oppo also increased its presence in online channels to sell devices.

“Considering the customers’ interest, Oppo started an online free home delivery service, which is continuing,” it said in a statement to The Daily Star.

“Our call centres promised to serve its customers 24/7. Customers can reach it anywhere, anytime,” it said.

As the government allowed malls to open from April 25, Oppo hopes it can resume physical sales by maintaining safety measures.

Realme, a Chinese smartphone manufacturer that started operations in Bangladesh over a year ago, has implemented a home delivery system for some selected smartphone models.

“Realme is keeping up with the growth of the e-commerce sector in Bangladesh. A considerable percentage of Realme phone sales comes from e-commerce,” it said in a statement.

Ziauddin Chowdhury, country general manager of Xiaomi Bangladesh, said the brand had maintained sales amidst the lockdown through its e-commerce partners.

According to the BTRC, the number of locally manufactured and imported mobile phones in Bangladesh stood at 2.94 crore units in the fiscal year of 2019-20. There were 1.49 crore units locally manufactured, overtaking the number of imported ones.

In that fiscal, the number of manufactured 2G phone (bar phone) was 94.05 lakh, 3G smartphone 9.77 lakh and 4G smartphone 45.99 lakh. Bangladesh imported 1.32 crore bar phones, 4.74 lakh 3G smartphones, and 7.65 lakh 4G smartphones.

It means Bangladesh-made devices can meet more than 80 per cent of the local smartphone demand.

Among the handset users in the last fiscal year, 77 per cent uses 2G phone (bar phone), 18 per cent 4G phones, and 5 per cent 3G phones, according to the BTRC.