India in Xiaomi’s Crosshairs – Chinese Firm to Launch Own E-Commerce; Set Up Manufacturing Plants and More

xiaomi_india_website_1024x506_hc5lsChina’s Apple ‘Xiaomi’ is seemingly having a lot of big plans for India. Not only it is changing its model for the first time i.e. selling its phones in brick and mortar stores in partnership with Airtel, it has announced some more strategic changes too.

Also read : Xiaomi Changes Business Model in India; Redmi Note and Redmi Note 4G to Be Available Offline

Taking Over Nokia’s Manufacturing Plant 

The company is looking to start making its devices in India. The world’s third-largest mobile phone vendor according to IDC has said that it is scouting for partners for making phones in India.

As per a TOI report, the company might use the idle plant of Nokia in Chennai, as a startup place in India.

We’ve started talking to some potential partners to see if they can assemble the phones for us in India,” said Manu Jain, head of Xiaomi’s India operations.

Since, India is the second largest market for Xiaomi devices, the company plans to concentrate and build up their platform here so as to understand and deal with the needs of the customer as closely as possible.

If the plan gets executed, then it will be the first time when a top Chinese device maker will be manufacturing products in India and hence it will boost PM Narendra Modi’s “make in India” campaign.

Bye bye Flipkart?

In a recent post, Mint reported that the Chinese Apple is planning to move away from the Flipkart’s marketplace and open up its own e-commerce website in India by the first half of 2015.

Similar Read:  Marketwire - Chinese VC Firm Shunwei Capital Partners Looks to Invest in India & More Market Updates

“We are working step by step in building our own e-commerce platform in india. Setting up own e-commerce platform is a complex task…it requires custom clearance, warehousing, payment integration, last-mile connectivity. We are talking to a number of partners… we don’t have specific launch date yet but it will happen sometime in first half of the next year,” said Hugo Barra, Vice President of Xiaomi Global.

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Shown Above: Hugo Barra, Vice President – Xiaomi Global

The company which claims to have spent USD 0 on marketing, leveraged Flipkart’s penetration and visibility in the country to grow its own reach. According to a IDC report 2014,  Xiaomi, acquired 211.3% of the market from the year 2013 to 2014, out of which India is its second biggest market after China.

The company currently imports phones in India from its suppliers in China and has been able to sell about 8 lakh devices here since the brand’s launch in July this year. And launching its own e-commerce business makes sense considering the demand it is seeing.

Xiaomi to Invest in Startups in India

In a recent news by The Hindu, Xiaomi on Monday said it will invest in technology start-ups in India with an aim to give a push to building a start-ups ecosystem in the country. The move is to engage startups to build products that could be useful for the company as well

“The start-ups ecosystem in India is very vibrant. Not many people realise that India has evolved from being the outsourcing hub for backoffice work to innovation hub,” Barra said adding the company will look at companies that build products that will add value and features to Xiaomi’s range of products.

Similar Read:  Future of App Development - Native Apps or Web App?

Xiaomi invests anything from USD 100,000 to millions of dollars on funding innovative firms.

Also read : Xiaomi to Approach Indian Authorities to Address Security Concerns Around Users’ data

With so much action Xiaomi is involved in in India, it is evident that it is looking to come out as a leader in the country. In a recent news,  IAF’s (Indian Air Force)  intelligence unit had sent out a report suspecting Xiaomi phones of sending the user’s information to Chinese servers in Beijing. The company had cleared off the concerns in a meeting with Indian Government.

The news would have come out as a hiccup in the midst of all these moves the company is making. Xiaomi’s strong focus on India might intimidate the indigenous players like Micromax, Lava, Karbonn and so on, who are having a good hold on the Indian market.

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  • Srinivas Injeti

    Makes business sense.