Lenovo Adds New Distribution Layer

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In an attempt to increase its focus on the consumer market, Lenovo India has realigned its go-to-market strategy. The vendor has added a regional distribution layer to its existing distribution model.

On the sidelines of the introduction of seven new products in New Delhi, Yathindra Nath, Director (Consumer Sales and Distribution), Lenovo India, said, “In an attempt to tap the PC penetration in the upcountry markets, we have adopted regional distribution model. However, our large chunk of consumer business comes from metros and A-class cities. Now as per the new business strategy, we will be penetrating into tier-II, III and tier IV cities with our regional distribution model. Internally, we have categorized the consumer business into four verticals: Lenovo exclusive stores, multi- branded showroom, regional distribution model and large format retailers (LFRs). Besides operating from four regions, we have identified three new regions: Central (MP, Chattisgarh, UP and Uttranchal), Mumbai and North.

These new regional distributors will Lenovo tap the emerging town and smaller cities effectively. The vendor has already selected its regional distributors, and is in the process of execution. “Looking at the strength of each region, we have appointed 2-5 regional distributors (RDs). Presently, we have 53 regional distributors operating in 35 cities. This year, we intend to achieve 30 percent of revenues/sales from Lenovo retail showroom, 20 percent from regional distributors, 11 percent from LFRs, and remaining from national distributors,” said Nath.

The vendor has also given a special status to Delhi-based Park Computers for getting direct billing, where in others RDs will buy the products from the national distributors.

According to Amar Babu, MD, Lenovo India, “Owing to the slowdown, we will be aggressively taking actions to control our expenses. We would start investing on marketing activities from next quarter, and see good growth in consumer market.”

Commenting on the new regional model, Delhi-based Vipul Jain, CEO, Unique Infoways, Lenovo Retail Partner, said, “We appreciate this regional model. This will allow customers to buy products from multiple partners in smaller cities.”

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