JioMart Is Sabotaging Entire Industry By Deep Discounts; FMCG Distributors Are Concerned, Complaint Lodged
Jio Mart has been accused of deep discounting by the All India Consumer Products Distributors Federation.
The complaint has been lodged with Marico, an Indian multinational consumer goods company providing consumer products and services in the areas of health, beauty, and wellness.
AICPDF Complaints Against Deep Discounting By JioMart
JioMart is only a couple of years old in the industry but has gained a huge market share in the Indian e-grocery market.
As per Dhairyashil Patil, National President, All India Consumer Products Distributors Federation, Jio Mart is offering huge discounts, sometimes of which are even more than the landing distribution price.
He said that their margin is around 5 per cent, but Jio Mart offers a discount of at least 10-15 per cent even below the authorized distribution margin, which hurts the ecosystem.
The association has penned a letter to Marico, wherein it has stated, “In response to the complaint, we have heard back from Marico, stating that the company has stopped billing to JioMart till such time when they do not stop deep discounting. So far, we have spotted this issue in Pune. If we find this issue in other circles, we will inform the company about the same, too.”
Deep Discounts Offered Only In Maharashtra?
Said deep discounts are being offered especially in Maharashtra.
We had previously reported that the scale and speed at JioMart Partner is growing, has caused disruption and triggered tensions between traditional distributors and Reliance that have boiled over into physical confrontation in some cases.
On the other hand, the sources in JioMart haven stated that Marico had stopped billing the Reliance Retail-owned grocery giant. This is reportedly “a pressure-building tactic. It is natural for different scales of companies to be able to negotiate a better distribution pricing. JioMart has not offered any discounts beyond the stipulated band by the FMCG company.”
The Confederation of All India Traders (CAIT) has also sided with the AICPDF.
There are more than 8 crore traders in India, and 4.5 lakh of these are distributors and more than 90 lakh are retailers. This means that there are about 1 crore people in the FMCG distribution business, as confirmed by National Secretary General Praveen Khandelwal.