National Store consolidates with measured steps

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JK Group of Companies was founded in 1965 as a one-shop enterprise with prime focus on wholesale and retailing of consumer electronics and photographic equipment. It has steadily grown, successfully switching roles, as an importer, exporter, local distributor, retailer, manufacturer and presently represents several reputed international brands of photographic equipment and accessories, electronics and foodstuff and consumables. Salah Khoory, General Manager, National Store LLC – JK Group and Ateeq Shamsi GM Operations,  National Store LLC – JK Group discuss the company’s focus areas

Discuss the group’s focus on the distribution business?
Ateeq Shamsi (AS): JK Group was established in 1965. It was focused on Electronics and photography Business. There are three divisions, one of which is into Electronics and Photography. We are distributors for Canon Photo Video products as exclusive distributors; we also started with printers which is not an exclusive agreement but in retail we are the only distributor
We are also distributors for SanDisk. There is also a sub-division for home appliances, Beauty care products; personal care products. We have an in-house Brand distributed to retail and some wholesale under the Crownline Brand. We have recently taken up distribution of Wiko but before that we had already introduced an in-house smartphone brand ‘Kzen’- made in China and in the past one and half years we have focused on the mid-to entry level segments for very low priced phones. We have done well in retail.
Wiko expressed their interest in working with us and we have taken up distribution rights for Wiko and have started the retail distribution with the brand. We are hopeful we can meet their expectations on sales expected.

Discuss how the decades old partnership with Canon is a special one for the company? What does this mean for you as a company with other brands that are associated with you?
Salah Khoory (SK): The partnership with Canon has been built on trust and such relationships over such long periods of time are rare in the industry. It is a special relationship and is a measure of canon’s satisfaction with the work we have done. The entire team is responsible for building this relationship. We later took up distribution rights for their printers but they don’t offer exclusive distribution rights for those products.
In a different segment, we have a similar long standing relationship of nearly 25 years with the brand Moser as exclusive distributor in the UAE.

The long standing relationships that National Stores has built with several of its vendor partners and also the fact that we have excellent relations with a large dealer network plus the fact that we are quite flexible with credit terms has helped built the company’s repute with many other vendors who are keen to work with us. We are always the first to support new dealers. We have invested in our logistics making sure that products are available to our dealers without any issues. There is a lot of hard work that goes into supporting our dealers during all major events such as GITEX Shopper, Summer Surprises etc.

Discuss why you have not focused on IT distribution a lot in the past? Is that changing now?
AS: We have not focused much on IT earlier. There were too many entrants and the margins were thin and unattractive. Also there was a lot of apprehensions of the volatility in the business channel. We are now focusing on strengthening the focus in this segment. We have tied up with a company called GP Batteries. We will be focusing on consumer IT products for distribution.

SK: We have always backed our vision. We have been told that we would be burning our fingers and we are entering quite late in the smartphone segment for instance. However, we had the visionfor the product to target the lower end as well as position as a possible second mobile for users including students and will also suit for use on travel. We didn’t go after the whole market and were conservative on marketing spend in terms of building the brand. We have thereafter gone into extending into 4K Action cameras, Bluetooth speakers, headsets, smart watches etc. We have focused on a complete range at affordable prices. We are looking to cater to users including students.
Good brands are associated with us today and we have created good demand for them in the brands. The Wiko partnership is one of the recent ones and we are hopeful of creating similar success.

What is the outlook ahead?
SK: We have a vision for the next three years in terms of where we want to go as a Business. We are always looking to expand, whether within the UAE or outside. To take a decision on further investments would be based on market realities. 2016 saw some correction in the market. This may continue until end of year. We hope things will improve by beginning of next year.

How do you see online retail picking up?
SK: We are seeing our dealers shrinking in their size. Online retail is becoming popular and is impacting offline retail. The new generation is more comfortable with online shopping and the preference goes beyond price differences. Online business is becoming more secure with each passing day. Retail will continue and will always thrive because of the high number of tourists to Dubai specifically and the UAE in general. The UAE has been a tourist hub and will also revolve around interesting activities through the year that bring in tourists. Online will take away some share and this may see a 20% shrinkage of conventional retail. The vision of the government in terms of digital is happing even in Business. There will be more competition and customers will have better choices.
The concept is changing. Online is becoming very smart and allows interactive shopping. The online pages of the stores are guiding users towards more offers like salesmen. It offers a different shopping experience.

How do you see the photography business changing?
SK: Today the market has seen a shift. Amateur photography is mostly shot on mobile phones. Professional photography has upgraded and even 4k videos can be shot on a DSLR. The variety and range is much more in terms of accessories. Photography is now picking up as a hobby and the mobile phone has indeed popularized it more, leading many users to take up this as a hobby and own a DSLR camera for taking pictures with better finish. Mobile photography is for instant pictures that are shared typically on social media but in turn has popularized demand for high end DSLR cameras. So the addressable market is growing for DSLR cameras.



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