The government of Pakistan recently announced increased levies for the import of completely knocked down (CKD) kits for mobile phones. Previously, the government policies that were in effect promoted the import of CKD kits by granting relief from import taxation to smartphone businesses. This resulted in an influx of smartphone / technology brands setting up local manufacturing plants in the country including realme, the popular Chinese technology brand which opened its assembly plant earlier this year. All of this increased market activity was instrumental in increasing the overall market share of the smartphone market from USD 240 million to USD 250 million and creating a plethora of jobs for the local population.
With the current political and economic uncertainty in Pakistan and inflation on the rise, the government is taking drastic measures to try and remedy the situation. The levies being set are dependent on the phones price bracket with the levy increasing with every bump up in the price range. In addition to this, the sales tax on mobile phones has gone up drastically from PKR 10/- per handset to 10% of the handset’s price. realme Pakistan has had a great year so far with the launch of its realme 9 series, the realme 9i and 9 Pro+, as well as the latest budget C series handset, the realme C35.
realme Pakistan‘s Country Director, Syed Mashood Hassan shed light on the recent changes happening in the smartphone industry and discussed how the import ban and increased levies will affect the state of the smartphone market. According to Syed Mashood, the increased levies on smartphone imports will disproportionately affect the premium segment more than the mid to low price segments. Unfortunately, the end users will have to bear the brunt of this policy change. However, realme fans need not worry as most of realme’s product offerings lie in the mid to low price segment so the effect on realme’s prices will be minimal when compared to high-end smartphone brands.
Users that are on the fringes of the premium segment will start to abandon the segment and trickle down into the mid-range and budget smartphone segments due to the increased burden of costs. This is an opportunity that can prove to be beneficial for realme as users who had been fixated on more premium brands will start to look towards brands like realme that offer high value for money products as a substitute which can boost realme’s standing in the country.
Due to the economic uncertainty in the country, the value of the dollar is frequently appreciating in comparison to the rupee. This has had a devastating effect on the buying power of consumers in Pakistan as goods and services are becoming more expensive without an adjustment in income to balance it out. realme is doing its best to maintain the buying power of consumers by offering alternative channels to purchase its products.
The tech democratizer has collaborated with Bank Alfalah in order to offer its customers the Buy Now, Pay Later (BNPL) facility which allows customers to purchase a smartphone with delayed payment. Alternatively, realme is offering increased support to its partners that offer the facility to purchase their products on an installment basis. realme’s goal is to keep the buying power of Pakistani consumers unaffected and allow them to purchase their products at a markup of 0%.
realme’s progress in the last quarter has been on the rise, increasing 45% with respect to sales and garnering a great response from customers especially after the launch of the realme C35 and they plan to continue to go strong in the latter half of 2022. The brand’s focus will be on releasing three to four new smartphones with 4GB / 128GB and 6GB / 128GB specifications for its Gen-Z audience. In August this year, the incredibly exciting realme Fan Fest 2022 will be taking place. Syed Mashood hopes that it will be a fun-filled event for loving realme fans and give the skeptics who have not had an experience with the realme brand a chance to experience their products and fall in love with realme as well. Recently across the border, realme India has opened the world’s first realme Global Flagship Store. With realme’s trajectory of growth so far, realme Pakistan is eager to follow in their footsteps so realme fans can enjoy the ultimate realme experience.
Pakistan is going through a very uncertain and unstable time right now because of the political conflict, scarcity of resources, and economic fluctuation in the country. Players in the smartphone market should brace themselves and prepare for a rocky period of activity until these overarching issues get mitigated. realme Pakistan will strive to continue its commitment to provide value to its consumers and do what it can to lift the burden off the buyers in the market.