MARKET
Sri Lanka has a population of almost 20 million people, of whom approximately 60% are below the international poverty line. On the face of it, this profile might not seem to present a viable marketing environment, and a context in which brands and corporate image would matter. But beneath these demographics is a complex and challenging social structure in which some of the world’s leading brands are thriving.
Automobiles, mobile phones, and packaged and convenience goods manufactured globally are available locally. Therefore, some 60% of the populace, approximately twelve million people (an estimated three million families), are a potential market for electrical home appliances.
Many Sri Lankans travel extensively and are aware of the changing lifestyles around the world. The media, too, has played a strong role in creating an awareness of these changes. Although Sri Lanka is steeped in tradition with regard to cuisine, family structures, religion and community life, its people have been quick to blend local values with technology and modernisation.
More and more Sri Lankans are taking up employment abroad, especially in Middle Eastern countries. They repatriate money to their families and this has resulted in uplifting the living standards of the less-affluent. This, in turn, has created an unprecedented demand for electric and electronic home appliances such as TVs, DVDs, refrigerators, washing machines and cookers in the rural sectors of Sri Lanka.
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ACHIEVEMENTS
Abans is the market leader in retailing refrigerators and air-conditioners, and it enjoys a considerable market in retailing TVs and other appliances.
Abans has also won an award for achieving the highest growth in the region in 2004, from LG Electronics. And it boasts a special award of appreciation for its outstanding contribution to strengthening economic ties between Sri Lanka and South Korea, by KOTRA – the Commercial Division of the South Korean Embassy.
Other companies in the Abans group have also won several awards.
Abans Office Automation has won recognition awards for brand building from Dialog Telekom in 2003, 2004 and 2005, and a merit award for the best concept in TVCs in 2005, by ABS Gardner Dixon Hall International (Abans’s in-house advertising agency), at the Reggie Candappa Awards.
Abans Environmental Services and Abans Electricals were awarded the ISO 9001-2000 Quality Certification.
Abans Restaurant Systems was felicitated by McDonald’s worldwide for outstanding growth of total sales, in percentage terms, for 2002-2003.
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HISTORY
In the 1970s, the government of Sri Lanka imposed a complete ban on the import of luxury items. At the time, Aban Pestonjee – an enterprising housewife – realised that there was a need for home appliances that would make a housewife’s daily chores easier. Housewives needed more time for their families and for leisure activities, she believed – and she set about to satisfy this need.
At that time, such home appliances were only available at auction rooms. This was a market of essentially second-hand appliances, created by diplomats and expatriates who sold them to auction rooms before returning to their countries. Pestonjee soon began to purchase items such as radios, fans, cookers, washing machines, floor polishers and vacuum cleaners, bringing them to her little garage workshop where they were serviced and repaired, then sold as reconditioned items with a guarantee.
This business model gave rise to the Abans Little Shop, as it was appropriately known. Located in Galle Road, Colpetty, close to where the Abans multi-storeyed complex now stands, this was the only place where someone could buy reconditioned home appliances with a guarantee. Very soon, the Abans Little Shop became famous for quality second-hand products and the demand for home appliances in Sri Lanka continued to grow.
By the 1980s, when the country started to enjoy the fruits of an open economy, Abans had already established a fully functional service and repair centre. Pestonjee’s perseverance and dynamism helped the company to secure agencies for internationally recognised brands of home appliances that were, until then, the domain of large British companies.
Today, Abans is a conglomerate comprising over 30 companies under the umbrella of the Abans Group – one which is involved in diverse activities such as trading, manufacturing, services, real estate, financial services and IT. It is, in fact, number one in retailing electric and electronic home appliances of globally recognised and nationally acclaimed brands.
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PRODUCT
Within the Abans Group, the principal entity – Abans Limited – imports and retails electric and electronic home appliances through its network of showrooms and authorised dealers around the island.
Abans is the agent in Sri Lanka for a host of reputable international brands. Its LG and JVC product ranges include TVs, DVDs, and home-theatre and audio systems. In domestic air-conditioners, Abans is the sole agent in Sri Lanka for LG, Haier and Mitsubishi brands, whilst the commercial versions come from LG, Trane and Mitsubishi. Abans also imports LG, Hoover and Electrolux washing machines and vacuum cleaners. As for refrigerators, customers visiting an Abans showroom are spoilt for choice, with a wide array of LG and Electrolux products on display. In the kitchen segment, cookers, cooker hoods, hobs and ovens from Elba; small appliances from old favourites such as Russell Hobbs and Morphy Richards; and Pyrex, Corning, Visions and Corelle cookware are on sale at Abans. And TOTO supplies Abans with its sanitary-ware products. The insatiable demand for mobile phones is also catered for at Abans – its range of brands include LG, Motorola, Sony Ericsson and Panasonic.
The group has diversified through its string of companies and is now involved in manufacturing, financial services, tours and tourism, telecommunications, hospitality, environmental conservation and importing vehicles. It also holds the franchise for the highly popular McDonald’s food chain.
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RECENT DEVELOPMENT
Abans Financial Services was established in 2005, mainly to offer customers competitive leasing opportunities and easy-payment facilities when purchasing products from Abans.
Within a very short period, the company – which was formed with the intention of being an Abans in-house leasing arm – has expanded its activities to offering leasing facilities for non-Abans products as well.
Abans Auto was established in the same year, to handle the import of a range of vehicles from Force Motors, India, for which the company secured agency rights: it is the sole agent for a range of commercial vehicles and is backed by a number of technical collaborations and business alliances with world leaders in the automobile industry such as MAN, Daimler-Chrysler and ZF.
With the rising cost of fuel, Abans decided to provide cheaper transport options for Sri Lankans by importing motorcycles and marketing them at affordable prices. In 2005, Abans Trandex Ventures was established to handle the import and distribution of Hero motorcycles from India, and Jiapeng and Toyostar from China.
Diversification, therefore, has reaped rich rewards for the group and been immensely beneficial to the local population.
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PROMOTION
Abans constantly engages in extensive advertising campaigns in the print media, TV and radio. In fact, it is among the biggest spenders on advertising in Sri Lanka. In addition, Abans promotes its products through outdoor advertising using hoardings at prominent locations, bus shelters, roundabouts, and street banners, and posters and danglers at point-of-sale outlets.
The group also sponsors various events such as international cricket and rugby football. Its involvement with music has seen it sponsor musical shows featuring international groups such as the Vengaboys, Shaggy, Kool & The Gang and Colonial Cousins. Abans also organises seasonal events for Christmas, Sinhala and Tamil New Year, and Ramazan. It also conducts regular cookery demonstrations and children’s programmes at its showrooms. And it pursues various social and charitable programmes.
One of Abans’s social programmes is to arrange special trips to different parts of the country for the kids of APE LAMAI Orphanage in Ambepussa.
Abans also supports World Children’s Day – every year, during the month of November (which is McDonald’s World Children’s Day), the restaurant undertakes a meaningful project at the Lamagramaya Children’s Orphanage in Hanwella. Apart from treating the children to refreshments and gifts during Christmas, McDonald’s has donated a dual-purpose vehicle for transporting children to school. McDonald’s has also completely refurbished two dormitories for the children at the orphanage.
In addition, Abans has sponsored a ward at the cancer hospital in Maharagama – and it has undertaken to maintain it on a regular basis. Abans has also met its pledge to contribute towards the construction of houses and the relocation of tsunami victims. Several houses have been constructed in Katukurunda – they are fully equipped and have been handed over to deserving families. Helping the disabled is another aspect of community service practised by Abans. Wheel chairs and medical supplies have been donated to the Victoria Home for the disabled.
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BRAND VALUES
Abans is synonymous with quality, value for money and speedy after-sales-service. It is the complete one-stop-shop for home appliances.
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THINGS YOU DONT KNOW ABOUT ABANS
♥ Founder Aban Pestonjee – a housewife at the time – ventured into business by setting up a garage workshop for reconditioned items.
♥ Abans has over 150 showrooms islandwide, with a network of more than 400 dealers, distributors and authorised service agents.
♥ Abans now imports motorcycles and three-wheelers for commercial passenger transport. Abans Auto was established in 2005, to import and sell motor vehicles. The company is the sole agent for a range of vehicles from Force Motors of India, and it has business alliances with MAN, Daimler-Chrysler and ZF. The vehicles imported by Abans range from three-wheelers to commercial passenger transport and cargo carriers.
♥ Abans introduced the fast-food chain McDonald’s to Sri Lanka.
♥ Abans is the market leader in Sri Lanka for refrigerators and air-conditioners.
♥ In 2005, its sales of LG products was the highest in the region in terms of growth.
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www.abansgroup.com
