Indian retailers threaten supply disruptions in protest of Reliance By Reuters

By Aditya Kalra and Abhirup Roy

NEW DELHI (Reuters) – Indian home goods sellers have threatened to disrupt the supply of mother and pop stores if consumer companies offer products at lower prices to Reliance Industries, according to a letter seen by Reuters.

Indian retailers representing companies such as Reckitt Benckiser, Unilever (NYSE 🙂 and Colgate-Palmolive (NYSE 🙂 last month told Reuters that their sales had fallen by 20-25% in the past year as more and more mom and pop stores were collaborating. . Trust of Mukesh Ambani of India.

Ambani’s high-discount offerings were pushing more stores to order digitally from its JioMart Partner app, and they served all corners of the nation over the decades as an existential threat to more than 450,000 business vendors to take orders from store to store.

Citing the Reuters story, the All India Consumer Products Distributors Federation – which has 400,000 members – has written to consumer companies asking for the same, saying that they should get the products at the same prices as other large distribution companies.

If the demand for price parity is not met, the group said in its letter that its sellers will stop distributing products to mom-and-pop stores and also will not supply newly marketed consumer goods if those partnerships continue from January 1.

“We have gained a reputation and goodwill among our merchants for many years by providing good service …” We have decided to call it a “cooperative” movement, “the letter said.

Dhairyashil Patil Group chairman said the letter was sent to Reckitt, Hindustan Unilever, Colgate and 20 other consumer goods companies.

All three consumer companies, including Reliance, did not respond to requests.

Mom-and-pop stores, or “kirans,” account for 80 percent of India’s $ 900 billion retail market. About 300,000 stores in 150 cities are asking Merchandise for merchandise, with the company aiming to have 10 million store partners by 2024.

Traditional distributors have told Reuters that they have been forced to cut their vehicle fleet and staff because they are suffering from their business because they cannot match the prices of Reliance.

Jefferies (NYSE 🙂 estimated in March that the kirana would “continuously increase the hiring fee” from Reliance “at the cost of traditional distributors.” These Reliance sales could be $ 10.4 trillion by 2025 to $ 200 million by 2021-22, Jefferies estimates.