Khind to tie Mistral link to the Middle East

Malaysian electronics and household appliance manufacturer Khind Industries counts the Middle East as its biggest export market. The company aims to consolidate its presence in the region as it rolls out a raft of new products over the next six months.

  • E-Mail
By  Aaron Greenwood Published  June 5, 2006

|~|Khind03200.gif|~|Khind regional sales manager Adil Jimmy Mistry says the company is committed to expanding its presence in the Middle East.|~|Malaysian electronics and household appliance manufacturer Khind Industries counts the Middle East as its biggest export market. The company aims to consolidate its presence in the region as it rolls out a raft of new products over the next six months. Aaron Greenwood reports. From humble beginnings in the 1960s as a service operation for electrical appliances, Khind Industries has emerged as one of Malaysia’s biggest consumer electronics and household appliance manufacturers. With a booming domestic business, the company is increasingly targeting export markets for future growth, with the Middle East ranking as the major market for the realisation of these aspirations. Already, the Middle East accounts for 80% of Khind’s export shipments and around 50% of the company’s annual turnover, which nudged US$46 million in 2005. The company’s growth in the region has been remarkable, given that the one-time OEM manufacturer only began exporting Khind-branded products to the Middle East in 1988. The deal, which was valued at US$4,700, marked Khind’s first foray outside the Malaysian market. Khind now exports goods to 50 countries worldwide, and leveraging a strategic partnership with Australian consumer electronics and household appliance manufacturer Mistral, the company plans to embark on a significant product roll-out in a bid to consolidate its presence in key markets across the Middle East. The Mistral deal ultimately provides Khind with access to the Australian company’s diverse range of products, which includes electric fans, refrigerators, and plasma and LCD TVs, and Mistral-branded naming rights for use in the Asia Pacific, Malaysia, the Middle East and Africa. It also calls for the companies to collaborate on future product development and to share manufacturing resources. Khind Middle East regional sales manager Adil Jimmy Mistry says the company expects the launch of these Mistral-branded products, in addition to the introduction of new Khind-branded goods, will serve its continued growth in the Middle East. “We are pitching Mistral as a premium lifestyle brand, and in terms of products our main focus will be plasma and LCD TVs,” he says. “We will also expand our range of household appliances under the Khind brand. “We are planning to roll-out these new products initially in the GCC in the third quarter of this year, before targeting other markets across the region.” Mistry cites Saudi Arabia, the UAE and Kuwait as the company’s biggest markets in the Middle East. He says that the region’s increasing affluence coupled with increased demand for premium consumer electronics products such as flat-screen TVs should ensure the company achieves “double-digit growth over the next three to four years”. “The Middle East is currently our main export market worldwide and we believe there is still huge untapped potential here,” he says. “There is a burgeoning mid- to high-income consumer demographic which we plan to pitch our products to. “Our aim is to become a world-class brand. At the moment we are a ‘world brand from Malaysia’, but we want to become a world-class brand and to become a leader in the consumer electronics and household appliance sector.”||**|||~|Khind05.gif|~|Khind’s vacuum cleaner range has achieved impressive sales in the GCC region.|~|Mistry says that Malaysia is renowned as a base for manufacturing consumer electronics products. “Major consumer electronics vendors such as Sony and Panasonic have established manufacturing facilities in Malaysia, and Malaysian products are considered quality products in this region,” he says. “This fact coupled with our long-term presence in the Middle East means the time is right for us to shift our emphasis to promoting our house brand and leveraging our heritage as a Malaysian-based manufacturer.” Mistry says Khind has established fruitful relationships with key channel distribution partners in every country in the Middle East, apart from the “challenging” markets of Syria and Iraq. The company is also currently negotiating a deal with an unnamed domestic distributor that will see the wholesale roll-out of its product portfolio in Iran before the end of 2006. Mistry claims that fostering successful channel relationships has proven a key element in propelling the company’s growth in the Middle East. “We have based our strategy on establishing solid relationships with distributors servicing individual countries across the region,” he says. “We work with these partners to promote our brand by conducting roadshows and seminars for retailers and end-users. “Our policy is to work with channel distributors that specialise in quality products. We are not interested in working with distributors that specialise in low-end goods. Once we appoint a distributor we work to foster a long-term relationship with them. We appointed our first distributor in Dubai in 1988, in Yemen in 1991, and Kuwait in 1993, and we still work with each of them. We expect these distributors to play a key role in creating a market presence for our new product range in their respective markets. We are not looking for multiple distributors in each country.” Mistry says Khind is currently studying the UAE market “to develop our strategy for targeting growth in the retail sector, whether that means finding the right agent or distributor. In terms of other countries we have already appointed our distributors”. “Our key retail partners in Dubai for example mainly specialise in household electrical products. There isn’t a huge market for our consumer electronics or home appliances in Dubai just yet, and we don’t sell directly to hypermarkets in the UAE at present,” he concedes. “It is very difficult to break into developed markets such as the UAE with new products, but with the support of our distributors and an aggressive pricing and marketing strategy, we are confident that we will make some inroads.” Mistry says Khind is committed to ensuring “better margins on our products compared to our competitors”. “Our low-cost manufacturing base in Malaysia and strategic OEM relationships enable us to achieve this,” he says. In a bid to better service its channel partners across the Middle East, Khind established an office in Dubai’s Jebel Ali Free Zone last year, which also serves as the company’s wholesale distribution base. Mistry says that the company’s rapid growth meant it was essential it provided quality localised customer service to its partners in the region. “We have about eight staff in our Jebel Ali office and warehousing facilities, which feeds stock for urgent requirements across the Middle East,” he explains. “However, for bulk orders, goods are shipped directly from our manufacturing base in Malaysia to clients irrespective of their location in the region. “Dubai also acts as a re-export base for our goods regionally, however we do not encourage grey market distribution. We do have certain strategies in place to monitor this market, to ensure that our major regional distributors are not affected. If anything, we prefer the product lands in Africa, so as not to impact our official distribution channels in the Middle East. “However, for some emerging markets, particularly those in Africa, grey imports can prove beneficial in terms of helping to create a presence for our brand, before we officially launch into those countries.” Mistry says the fact that the bulk of Khind’s goods are exported to the Middle East makes it essential for the company to ensure a certain level of product customisation in order to satisfy consumer demand. “Middle East consumers expect certain features in household appliances,” he explains. “We customise our electric fans and air conditioners to meet local needs. We specialise in split-cycle air conditioners, which have proven very popular in Kuwait, Qatar and Yemen. These products are distributed by the same companies that distribute our household appliances.” Mistry says these initiatives are an indication of the company’s serious intent to become a major player in the global consumer electronics sector. “Our long-term vision is that we become a leading consumer electronics and household appliance brand not just in Malaysia, but worldwide,” he says. “We are not concentrating on providing OEM manufacturing facilities to other brands, but are instead focused on increasing the profile of the Khind and Mistral brands in key markets such as the Middle East.” ||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code