Electronic sales to reach precrisis level in two years
Electronic sales to reach precrisis level in two years
JAKARTA (JP): Sales of electronics goods, especially audio
video products, have shown significant growth in recent months
but it will take two years to bring them back to precrisis
levels, according to market research and consultant firm AMI
Business Consulting.
The entrance of new players with lower priced merchandises
into the domestic electronics market, however, will bring fiercer
competition, the company said in a report on the results from a
recent market survey it made.
The survey was conducted on local sales of different brands of
color televisions, video compact disc (VCD) players, digital
video disc (DVD) players, projection televisions and multimedia
set-top boxes.
The survey found that business in the audio video sector
started to rebound last year in line with the gradual recovery of
consumer confidence, a revival of consumer financing companies
and more stable exchange rates.
"Looking at these indications, people in these particular
electronic goods businesses believe that their sales will return
to precrisis levels by 2002," the company said.
The electronic audio video business reached rock bottom in
1998, when sales of color televisions fell to only 500,000 units,
projection televisions 445 units, VCD players 200,000 units and
DVD players 4,000 units.
The company projected that in 2002 sales of color televisions
would exceed 2.24 million units, projection televisions around
1,400 units, VCD players over 300,000 units and DVD players
nearly 18,500 units.
AMI Business Consulting, which is a member of the Asia-based
market survey and consultant firm Asia Market Intelligence,
attributed its optimistic outlook on VCD player sales to an
expected sharp increase in the supply of the product in the
coming years.
The future supply of VCD players will lead to a decrease in
their price, making the products more affordable for customers,
the company said.
As for the multimedia set-top box, the company said retailers
of such products would enjoy very rapid growth over the next few
years thanks to the expected robust development in the country's
Internet and multimedia sectors.
Set-top boxes have just been introduced here to a particular
marker segment who want to use their television sets instead of
personal computers to access the Internet. The products -- a
decoder and a converter -- allow a television to function like a
computer.
The company projected sales of the decoder unit to grow by 200
percent per year until 2002 and the converter by 90 percent per
year. Overall, sales of set-top boxes are expected to reach
75,000 units in 2002, as against 8,000 units in 1998.
The company said intense competition would mostly take place
in the color television and VCD player markets.
It said Japanese and Korean color television sets, which
currently dominate the Indonesian market, would face tough
competition from newly introduced Chinese products.
Chinese color televisions are seen as serious threat because
they are sold much cheaper than Japanese and Korean products.
"The problem is that some of the market segments have changed
their buying behavior as an impact of the country's financial
crisis and switched to the less expensive televisions,
disregarding the brands," the company said.
The competition in the VCD player market is expected to
escalate in line with the entrance of new, cheaper brands and
models. Currently, there are over 24 brands of VCD players
competing in the local market.
As well as the tough competition from new comers, established
electronics producers and retailers will also face problems
derived from the entrance of cheap smuggled goods to the market.
The company said the smuggling of electronic goods was
difficult to handle, partly due to Indonesia's size, but the
government must try to curb it because it distorts the local
market.(cst)