Are You a Battery Manufacturer?

Are you finding it difficult to sell batteries in the retail market?

IF YES, DO READ THIS TO PAUSE & INTROSPECT.

Then sit back and think.

1. What does your customer want?
2. He wants batteries or the output from batteries?

We need to understand that batteries store energy, and the user of batteries is only interested in this stored power.

1. Let us understand what the customer does not like about buying batteries. All batteries, even unbranded ones, are expensive.
2. Batteries need maintenance. AMC is cumbersome and an additional task in addition to cost.
3. Battery buying is an activity that is best avoided and is boring.
4. The offers of different battery manufacturers are confusing.
5. Dealers selling unbranded batteries keep shifting loyalties.
6. Branded batteries are costlier than unbranded batteries.

Next, understand the customer of today.

1. He or she is looking for reliable and trouble-free service.
2. He/she is ready to pay—an EMI and not a lump sum.
3. He or she does not want to be committed in many matters. Batteries are not considered an asset anymore but a necessary evil.
4. His or her job entails shifting for work from cities and even countries at times.

Observe the trend.

1. Ola and Uber are convenient and hence have succeeded as concepts.
2. I Phones and other costly smartphones sell more easily on EMI than against full payment.
3. Netflix and Amazon Prime OTT platforms are examples of subscription-based services that are popular.

What needs to be done?

Battery manufacturers need to come together and have an app developed that can onboard battery dealers. Probably inverter and solar system integrators, who sell batteries too, can be part of this network.

An app developer can make this app independently if the battery manufacturers do not want to invest in software development and maintenance of the app. App development is not the forte of battery manufacturers anyway. The marketing of this app, which is like a Zomato or Swiggy app, is then the job of the app developer.

Customers or users of batteries need to be registered on this app for the service they need. The battery sellers can then make suitable offers to the prospective battery user.

The battery dealers can, in fact, onboard prospective battery customers onto this app.

Once the credit card is swiped, payment shall be done monthly until the service is availed. Basically, the entire system should work like an electricity utility company. Or like a newspaper or magazine subscription.

The app developer benefits from the subscription fee from the battery seller, and the battery seller benefits from the battery users’ monthly payments. The app can communicate with the BMS and give periodic alerts. A GPS can be incorporated as part of the system to provide alerts in case of a battery and inverter. The app can be made with all the inputs needed.

The onboarding of users should happen with

1. One-time immediate payment for installation and commissioning in the case of automotive batteries or necessary wiring in the case of inverter/solar batteries.
2. A security deposit of the battery or battery and inverter can be collected as a reserve future payment by credit card and not as a lump sum payment.
3. Monthly payment of the EMI setting may be done. All these can happen with credit card details.
4. On receipt of the monthly payment, the security deposit must be reduced accordingly.
5. The OTP method commonly used nowadays can be used for the start and discontinuation of service.
6. Discontinuation of service terms can be equated to the cost of the system and the expected life of the battery.
7. The cost of the scrap battery, which is in good working condition, needs to be factored into the system properly—as a lump sum rebate for the next cycle or as a free service for extra months in this or the next cycle.
8. Terms for discontinuation of service in between can be decided and incorporated into the app.

Users can use this working system and the app for

• automotive batteries
• inverter batteries
• inverters and batteries
• UPS systems
• solar batteries
• lift batteries in residential complexes
• golf cart batteries,
• scrubbers
• battery rental services
• forklifts and other MHEs like pallet trucks or scissor lifts

In fact, the biggest buyers of motive power batteries as well as material handling equipment are rental companies that provide service to large industries and warehouses. The users of this service do not employ drivers for three shifts. This is the responsibility of the service provider. In fact, they do not have to worry about maintenance. They only provide space for charging the batteries and the required electric points for the charger. Even the charger and charger maintenance are in the purview of the service provider.

This model of the MHE segment is probably what inverter, solar, and other segment battery manufacturers have to follow and implement.

How do inverter battery manufacturers benefit?

Presently the competition in the market and price war amongst competitors is leading to the closure of many manufacturing companies. The quality of batteries is the first casualty.

Once this system of providing stored energy starts, every manufacturer benefits. The ones using more lead and good technology to make batteries shall earn monthly EMI payments for a longer duration from the same battery. Others using less raw materials shall have batteries working for fewer months. As far as the user is concerned the per month cost shall be uniform. This shall be a Win-Win situation for both the battery manufacturer and the battery user.

The competition amongst battery manufacturers shall now be a healthy competition to make longer-lasting batteries. With the cutthroat competition consigned to the dustbin, the industry shall surely survive according to me.

Does the above formula apply to all battery manufacturers?

No.

Manufacturers exporting batteries, selling to government agencies or supplying in bulk have no issues and are not part of the retail market. They need to compete at a different level and are in a different market altogether. Hence these battery manufacturers can continue with direct sale of batteries.

The other manufacturers catering to retail may have to rethink their strategy and adopt this or some other better idea.

What could be a better idea?

A better idea may be having an entire residential society have renewable energy or power from a UPS with metered power in each apartment. This is similar to the piped gas system.

A still better idea may be a smart hybrid system for residential complexes. Utility power has to be used only when renewable energy is not available. The utility can be on standby to top up the power requirement based on load. This facility, however, will need to be implemented at the time of the construction of the apartments.

As with any new scheme or proposal, this is an idea that needs to be worked upon and honed to perfection. Efforts from all stakeholders will surely benefit the battery manufacturers, who are struggling to sell batteries in the retail market.

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