The overall slowdown in the Indian economy and serious competition from Chinese brands such as Xiaomi and OnePlus has forced Sony India to review its India strategy. According to an Economic Times report, one of the outcomes of such a review is the decision to reduce its workforce by 120. Some expect this number to even reach 200. The company has a strength of 900 employees in the Indian arm as per its website.
Sony had already made changes to the Indian business and cut down on many product lines, which were unviable. Its televisions were still popular and the company‚Äôs products in this segment commanded a premium in terms of pricing. Market observers feel the company failed to read the pulse of the purchasers of televisions among the younger generation of the population and this has resulted in their losing sales volumes over the past few years.
Like in many fields of activity, perception becomes important and the general opinion among the Indian youth was that Sony televisions ranked fourth or fifth among the top brands, behind, Xiaomi, OnePlus and Samsung or even TCL. This has resulted in further hastening the downward spiral in its sales figures.
Sony India‚Äôs overall revenue dropped from Rs 11,010 crore in FY2015 to Rs 6,417 crore in FY19, almost half the turnover in a matter of four years. Televisions accounted for almost 60% of the sales turnover in the Indian market for Sony India.
However, it has to kept in view that the market for television sets itself has been seeing a decline in growth. The market expended by 22% in 2015 over the previous year, whereas by 2017, this rate had come down to just 3%. In a falling market, the ones to be hit hard are the brands that are priced more compared to competition.
Sony India has not denied that they are downsizing the workforce, but claims that it is an internal issue and they are approaching it with complete sensitivity that it deserves.