The South Indian Organised Retailers Association (ORA) is gearing up to take action against POCO, a sub-brand of Xiaomi, alleging unethical business practices that harm legitimate sales channels and government revenue.
The association claims that POCO’s strategy of avoiding mainstream channels in favor of online and “illegitimate” avenues is detrimental to consumer experience and employment generation in India.
Challenging POCO’s Business Approach
According to the ORA, POCO’s approach to distributing its phones circumvents traditional sales channels, favoring online platforms and “illegitimate” channels. This tactic, the association argues, is aimed at minimizing spending but comes at the expense of consumer experience and employment opportunities in the country. Unlike other major smartphone brands, POCO allegedly operates with just three distributors and lacks sales promoters, further exacerbating concerns about its impact on the Indian market.
Implications for the Industry and Economy
The ORA contends that POCO’s business practices not only harm legitimate sales channels but also result in financial losses for the government. By sidestepping traditional distribution channels, POCO allegedly avoids paying taxes and other fees that contribute to the government exchequer. These actions, the association asserts, have far-reaching implications for the industry and the economy as a whole.
Call for Action
Expressing serious concerns over POCO’s operations in India, the ORA is calling for swift action to address the issue. The association plans to approach the central government to seek intervention and ensure ethical business conduct in the country. ORA emphasizes the need for accountability and transparency in the smartphone market and is prepared to escalate the matter to the Ministry and relevant departments.
Seeking Resolution
Despite multiple attempts to engage with POCO’s leadership team, the ORA claims to have received no response, prompting the association to take further steps. After the Lok Sabha elections, ORA intends to escalate the matter to demand the cancellation of POCO’s trade license. Additionally, the association is prepared to file a case with the Competition Commission of India (CCI) to address concerns of unfair competition and market practices.
