Major global giant companies are turning towards a localisation drive for component supplies, as dependency on other countries might disrupt business in the long run. Recently, boAt, the fastest-growing D2C electronic wearable brand, has been seeking local manufacturers for major components of manufacturing audio and other devices. Let’s take an overview of the decision made by boAt for replacing manufacturers and how it impacts them.

boAt’s Initiative to Replace Components with Local Ones

With the ongoing trend of Make in India, boAt is aiming to supply major components from local manufacturers in India. Around 80% of audio devices and 95% of components of its wearables are supplied by Indian manufacturers. In the coming future, the company aims to shift towards localisation for the supply of printed circuit board assemblies (PCBA) and other components like batteries.

The main purpose is to cut the extra cost levied on the company due to import policies. Importing components from outside India scales up the pricing, so local supplies will minimise the input cost implications and add more value to the company’s financial growth.

Sameer Mehta, co-founder and product chief, boAt, shared with Financial Express, “PCB and the battery, which is the highest cost in the overall BOM (Bills of material) costs, is something that we are looking to localise, and then we go to the other tail items such as the plastics and mechanicals later on.”

boAt has already made tie-ups with local manufacturers in India, such as VVDN Technologies, Bharat FIH, Foxconn, ILJIN Electronics, and Dixon Technologies. The company has a manufacturing joint venture with all these suppliers and produces 60-65% of its overall device components.

Cost Effective Decision

boAt company hold a major part of the audio-wearable market due to a low-cost pricing model that makes it affordable for end users. Make in India gear up the business owners point of view to shift towards local manufactures, boAt pick up the initiative post covid.

Deciding on a local manufacturer for supplies can reduce input costs to a higher margin. It will accelerate boAt plans to bring up more affordable products for users. Replacing manufacturer’s amounts as the viable budget segment decision for boAt will impact customer pricing and internal overhead costs for assembling. As per the reports, boAt expects a 25% rise in revenue growth by 2024, and achieving the benchmark cost reduction will be a practical step to stabilise finances.

Financial Growth Aspect of boAt

boAt holds the largest market share in the Indian market with the best pricing models and marketing strategies. The decision to turn towards local manufacturers might positively impact brand image & credibility. boAt company has huge potential to grow financials; if you want to invest in boAt shares to gain profit, check out Stockify, the best online trading platform for unlisted shares. You can check boat share price and other financials by visiting the platform.