In recent years, smartphone brands such as Xiaomi, Realme, Oppo and Vivo have been under pressure from offline retailers to offer steep discounts on their products online. The All India Mobile Retailers Association (AIMRA), an association of offline retailers, has also filed a complaint with the government in this regard. (AIMRA) represents 1.5 million mobile phone retailers in the country.
Smartphone brands like Xiaomi and Realme are reportedly cracking down on retailers trying to make a quick buck by selling their devices cheaply on online platforms. According to a report in Economic Times, this happened as these companies relied heavily on offline channels to drive growth.
Following complaints from retailer associations, brands including Xiaomi and Realme are expected to buy back sold inventory at lower prices to penalize retailers and distributors. According to the report, these brands are now allowing retailers to issue warnings and ban them from selling their products outside authorized channels to avoid further liquidation damage and loss of business. The agreement is said to have been signed.
There are several cases where retailers from states like Jammu, West Bengal, Haryana and Tamil Nadu have reportedly signed such agreements.
AIMRA complaint letter to Xiaomi and Realme
The Mobile Offline Retailers Association has seen more than a dozen products from brands like Xiaomi, Realme and Samsung being sold in online channels at prices around Rs 1,000 to Rs 2,000 less than the minimum operating price (MOP).
A brand once admitted that an e-commerce platform allows retailers (mainly wholesalers) to register online and sell their products just to gain market share, but that is actually a hard sell. Was. “A loss of ground and credibility for a major retailer that has worked hard to sell products to consumers in the best possible way,” the retailers association said March 26. This was said in a letter to Realme.
“Strong action to address the root causes of concern is within the brand’s own control and must be taken to achieve the best possible, continued positive outcome for the brand in the long term,” the letter said.
A similar letter was also sent to Xiaomi, a copy of which has been seen by ET. In response, a Xiaomi representative said: “These stocks will be uploaded online by our retail scalper partners after all programs have been discontinued. We will find the cause and solve the problem by imposing heavy fines. “Solve it.”
The share of sales in retail is higher than the share of sales on online platforms
This comes at a time when retail stores generate more sales than online platforms. IDC India estimates that online platforms (Amazon and Flipkart) currently account for 48% of total sales in January-February and 49% in 2023, while shipments to online channels fell by 6% in 2023.
Bhupendra Singh Chundawat is a seasoned technology journalist with over 22 years of experience in the media industry. He specializes in covering the global technology landscape, with a deep focus on manufacturing trends and the geopolitical impact on tech companies. Currently serving as the Editor at Udaipur Kiran, his insights are shaped by decades of hands-on reporting and editorial leadership in the fast-evolving world of technology.