‘Daiwa’ means ‘Big Platform’ in Japanese and is a very common business name in Japan. The term perfectly describes our company, which connects the larger platform to the consumers. It also refers to an important aspect of Japanese culture.
March 2023: In this exclusive interaction with Niranjan Mudholkar, Editorial Director, Pro MFG Media, Arjun Bajaaj, CEO and Founder, Daiwa India, talking about his entrepreneurial journey says that ‘it has been extremely difficult but exciting given the current state of the Indian Consumer Durables market’.
What motivated you to undertake this entrepreneurial journey as the founder of Daiwa when your father was already running a well-established business with Videotex India?
To begin with, I had always wanted to join my family business, but I didn't want to be just another addition; instead, I wanted to add value to my father’s empire. While studying Business Management at the University of Essex in the United Kingdom and pondering my next steps, I noticed rapid changes in the Indian retail market, where Flipkart and Amazon had gained a toehold and were making rapid strides in the Indian TV industry. While studying and comprehending, I saw a problem where others saw a solution. Most brands selling electronics on these channels sourced the final product from China, and none could control the quality because they only assembled and did not go any further. Bridging this gap resulted in creating my first Brand, ‘Daiwa’, in 2016. Daiwa established its presence through word of mouth over the years and has seen tremendous success in the offline markets.
What is the meaning of the name Daiwa? How did you come up with it?
‘Daiwa’ means ‘Big Platform’ in Japanese and is a very common business name in Japan. The term perfectly describes our company, which connects the larger platform to the consumers. It also refers to an important aspect of Japanese culture.
What are some of the challenges that you have faced as an entrepreneur and how did you overcome the same?
Initially, I was in control of everything, from cataloguing to designs to order processing to dispatches and after-sales service. Like every entrepreneur’s journey, it was a one-man army show. However, with time and consistent progress, Daiwa today has a solid team of over 100+ people governing the functioning of the Brand. In terms of challenges, we initially encountered a lot of market resistance; it was difficult to move sales because it was much unknown to the end users. This made forming alliances with online partners difficult. It was also difficult to compete with growing competition from overseas as well as Indian brands, especially when prices became very competitive. Another significant challenge is that we operate in a highly competitive industry in which you must constantly keep yourself and your product portfolio up to date with rapidly changing technology and global trends. It is difficult to provide the best technology at comparable prices. However, our products have generated positive word of mouth over time, and Daiwa as a brand became well-known and gained acceptance in Indian markets. Daiwa now sells its products in all major retail outlets as well as online. Daiwa now sells its products in all major retail stores and also through its website. The journey has been extremely difficult but exciting given the current state of the Indian Consumer Durables market.
Manufacturing is not an obvious option when it comes to entrepreneurship in India. You are one of the successful exceptions following the footsteps of your father. What advice would you share for budding entrepreneurs?
I make every effort to live a disciplined, goal-oriented life. I am extremely punctual and live by the motto ‘No shortcuts, work for it!’ I always agree that there will be difficulties along the way, but one should persevere until one succeeds. Last but not least, I have always considered myself to be a leader rather than a ‘boss’. To properly run a manufacturing plant, building a strong team and processes is critical. The ‘Sab Chalta Hai’ mentality will not get you far in life.
Where does Daiwa manufacture its products at present?
Daiwa televisions are manufactured at Videotex International’s high-end facility in Greater Noida. Our parent company, Videotex, is one of the leading OEM/ODM players for smart TV, bringing the best to India for over four decades. In Greater Noida, Videotex currently has a capacity to produce 1.4 million TVs per year, and plans to add another manufacturing facility and invest Rs.100 crore to produce 1.8 million TVs. As a result, the total annual production capacity will rise to 3.2 million televisions. We aim to provide unprecedented, ground-breaking technology at unrivalled prices, and we have so far kept our word.
You operate in a very competitive industry and also operate in a market where customers are both demanding as well as price sensitive. How are you managing costs at the manufacturing level while also ensuring good quality at competitive prices?
Yes, the Indian television manufacturing industry is still very competitive. Indian customers require the best of both worlds: low prices and cutting-edge technology. To accomplish this, Videotex (the parent company) has placed a strong emphasis on R&D and has manufacturing units in India to provide our customers with the most up-to-date technology. Daiwa's several first-timer technologies launched in India are a strong testament to this. In terms of manufacturing, we focus a lot on backward integration, have strong relationships with our suppliers, and because we buy raw materials in bulk, it creates a win-win situation. As a manufacturer, we prioritize controlling operating costs and inventory management. Many ups and downs from the supply side have also provided us with valuable lessons in inventory management over the last few months.
What is your current turnover and what kind of growth targets have you set for the next two years?
Daiwa has traditionally been an offline brand in India. We have been steadily growing and strong, despite the discount online players. We have carved out a niche for ourselves and have grown by 20-30 percent year on year.
The Indian television market – which is pegged at Rs 75,000 crore currently as per EY – is flooded with many big and well-established names. What is your strategy to survive and succeed in this highly competitive environment?
Since our inception, our strategy has been to combine quality with affordability. Daiwa has consistently focused on developing the most advanced technology at competitive prices, particularly for the Indian market. In terms of products, we have introduced several cutting-edge technologies to India, such as Wide Colour Gamut for Picture, Customized Box Speakers for India, Unique Remote with Direct App Keys and Keyboard with Easy Surf on Smart TVs, Balancing Voltage Fluctuations for TV as per Indian Power Conditions, and Voice Assistance, among others. We are also the first Indian Brand to launch 4K webOS TVs in India. Our goal has always been to go above and beyond for our customers.
Are you considering diversification into other product segments beyond television?
We will also branch out into new categories and have a strategy in the works.
Urbanization is creating a new breed of customer who is economically evolving and very aspirational. Do you plan to innovate to address the needs of this customer?
As I previously stated, our emphasis on R&D supported by Videotex International lineage has given us the ability to serve the latest in technology products at the most affordable price points. We want to dispel the myth that the best products are only available at the best prices. If you look at our product portfolio, Daiwa offers a wide range of premium products ranging from 32 inches to 65 inches that are priced half as much as the bigger brand names. Along with the product focus, we have expanded our after-sales service network to include over 100 cities across India.
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