The company has mainly opted for this step so that it can eliminate the middlemen. This also means that Xiaomi will be selling handsets at much lesser cost since the middleman is not involved.
Xiaomi has roped in Just Buy Live and Foxconn unit InnoConn to give a solid push to the offline sales of its devices in India. New firms will be acting as distributors of Chinese smartphone maker and will help the company to expand its reach to smaller cities.
The new partners will implement Xiaomi's direct-to-retail (DTR) model - developed specially for the Indian market - where they will buy from Xiaomi and supply directly to retail stores who may place orders as per demand.
The company has mainly opted for this step so that it can eliminate the middlemen and hence can sell the devices directly to the customers. This also means that Xiaomi will be selling handsets at much lesser cost since the middleman is not involved in the trade.
While providing the details of company’s futures plans to one of the renowned daily, Manu Jain, head of India operations at Xiaomi explained that the company will have access to 5,000 stores immediately, and is planning to reach 10,000 offline stores within a few months, 10 times more than its present reach that is restricted to south India with its partnership with Redington. Xiaomi is making it comfortable for people in smaller cities, tier 2-3 towns, where internet infrastructure is not developed, to purchase its smartphones.
Xiaomi has adopted different strategy for the offline sales in India. In China, it is working on different ground and has partnered with retail chains and telecom companies to promote its offline sales. However, company generates 30 per cent of its sales in China through brick-and-mortar stores. If company can achieve the same level (of offline presence) in India (as in China), it would be a great success for Xiaomi, adds Jain.