Traders resent FMCG cos for ‘deep discounts’ in e-commerce space

at 2:11 pm

New Delhi (NVI): The Federation of All India Distributors Associations (Faida) has written to 6-7 Fast-moving consumer goods (FMCG) companies on issues like deep discounting as well as price discrimination.

The association claims that FMCG companies are offering better margins and incentives to modern trade.

This has led to unhealthy trade systems playing out, say distributors.

“The margin differential is in the range of 15-20 percent in many cases and this is unacceptable,” said an FMCG distributor who did not want to be identified.

Issues like deep discounting, price discrimination, predatory pricing and margin differentials have been a cause of concern in the online or e-commerce space as well.

This clash has now moved to the offline space and distributors are blaming FMCG companies for giving them stepmotherly treatment.

According to the sources the association, representing 4.5 lakh distributors, has written to companies such as Dabur, Britannia, ITC, Godrej Consumer and Mondelez about this deep discounting and price discrimination.

“All direct supply to malls or modern trade should be stopped immediately and should be routed through standard distributor channel as it was or as earlier and according to the agreement entered,” said Faida in the letter.