With its retail operations gaining momentum, Tata Steel has begun lining up products which will enable it to penetrate the home-segment with branded offerings. The items include steel doors, windows and customised-wardrobes. Some products have been launched on a pilot-basis.
Tata Steel, which stepped into organised steel retailing in 2006 with a store (stocking downstream products of national and international makes) has now identified retail, brands and solutions, as a major vertical which will have an increasing share in its product-basket.
“Till the late 1990s, Tata Steel used to be a B2B company,” said Peeyush Gupta, vice president, steel (marketing & sales), Tata Steel. “In the early 2000s, we thought of approaching the end-consumer.” This endeavour saw the gradual expansion of Tata Steel’s branded product portfolio. From a 5% share in the sales turnover in 1999-2000, the proportion has grown to 45% in 2016-17.
Higher margins
Branded products also mean higher margins, even as it provides a cushion against market volatility. “It does not undergo the cycles experienced in the B2B play,” Mr. Gupta said.
To consolidate gains from the retail thrust, Tata Steel is also offering solutions and services which provide spin-off benefits, open future revenue-streams and keep retail sales from hitting a plateau, at a time when the company’s production and sales are increasing with the commencement of newer capacities as in Kalinganagar.
“A wood-finished steel door is one such ready-solution that we are offering to people who are building houses. The product is innovative — with a wood-like look and the sound of wood, and comes complete with latches and locks. The installation charge is included in the price, as is the steel-frame. The product is fire-safe.” said Mr. Gupta.
Branded as Pravesh Doors, the product is available in the eastern and northern parts of the country and will be seen in the south by July, followed by the west, he said.
To a question on areas where Tata Steel would like to mark its retail presence in the home-segment, Mr. Gupta said : “We would look only at items which can be converted to steel ... we will get into the furniture space.. our point of entry is wardrobes, which will replace wooden ones”.
Tata Steel has test marketed this in north India . “It will come in a big way, under the Cyan brand,” Mr. Gupta said.
Steel toilets
The company also counts among its innovations the Nest-In range of products which includes the easy-to-erect steel-body toilets, currently being used in the Swacch Bharat movement and also in cyclones and earthquake-hit areas.
“This is a complete construction solution and we have many more such in the pipeline,” Mr. Gupta said.
While the home-segment products are sold through distributors, Nest-in is sold directly.
Tata Steel closed FY17 with sales of 10.9 million tonnes, with B2C sales of 1.6 million tonnes. It recorded a and a double-digit growth in the services and solutions business.
