Low-cost gadgets ‘gain from bigger brands’ poor resale value’

By Ramesh Mathew/Staff  ReporterThe growing sales of low-cost electronic goods in Qatar can be attributed to not only the large-scale influx of low-income workers, but also to the perception among a section of people that products made by major brands often have “poor” resale value, according to industry insiders and consumers.Last month, Gulf Times had carried a report on how the presence of a sizeable low-income workforce helped create a huge market for low-priced electronic goods and home appliances across the GCC states.Over the years, the region has witnessed the growth of several brands that are developed by original equipment manufacturers in other countries, including China, and sold in large numbers to expatriate workers in the GCC region. Speaking on the issue of resale value, the head of an expatriate family said he disposed of a low-priced washing machine, which he had bought five years ago for QR350, at almost half its original rate about a month ago.“On the other hand, a branded automatic washing machine bought by my elder brother for about QR1,000 about four years ago fetched only QR200 when he sold it to a person at Souq Haraj around the same time,” he said.Further, the expatriate said he never expected his old washing machine to last even two years when he made the purchase and that he did not have to spend a single riyal on the gadget as repairing cost even once during the five years.A trader who buys second-hand electronic goods echoed his views, saying many people find it more sensible to buy a low-cost product as the rate of depreciation is not that high. According to the insiders, another reason behind the proliferation of low-cost electronic goods is their owners’ familiarity with market conditions in the region.“Many of them have worked in the retail market at different levels before establishing their own electronic brands. On the other hand, many of those representing established brands are either newcomers or are very formal in their business approach,” said a senior official of a distribution firm in Doha.Well aware of the nature of the regional market, the manufacturers offer attractive commissions to sellers and this seems to be one of the factors that prompt retailers to stock their goods in large numbers.Regular buyers of low-priced gadgets and appliances also said the cost of maintaining and repairing these products is less than that of the big brands. Enquiries made by this newspaper over the past week showed that low-priced electronic goods and home appliances have made their way into outlets and locations where established brands have a negligible presence. “This can happen only on account of their owners’ familiarity with the market,” said a senior manager of an established brand. “For instance, in locations such as the Industrial Area, it is mostly such goods that have entered the market.”However, it has been noticed of late that major electronics retailers are also keeping stocks of low-priced gadgets at their stores, which many workers have generally been reluctant to visit until now. “We have taken utmost care to attract such customers to our shops through specially-trained marketing personnel,” said a senior official of a major electronic goods distributor, adding that even outlets like his nowadays stock a number of low-priced brands to cater to the needs of such workers.Interestingly, retailers also point out that while the low-income groups are the major patrons of cheaper brands, the demand for these gadgets is quite high among middle-income sections of the population as well.